To: Business Managers
Human Resources Facilitators
From: Dennis Press, University Controller
Date: July 19, 2010
The standard notifications regarding benefit rates will be distributed again this year, but I wanted to mention an issue regarding the Employer Contribution for State Retirement. The Employer Contribution rate will increase to 10.51% for FY 2010-11. The rate has two components:
- Regular Employer Contribution 9.15%
- Employer Contribution Reserve 1.36%
- Total Rate 10.51%
Based on information provided to the University by State-level offices, 1.36% of the 10.51% needs to be segregated and accounted for separately. The funds will be held in reserve in case there is a reduction in the employer contributions to the retirement system later in the fiscal year. If there is a reduction in the employer contributions, the State funds portion could be redirected to offset receipts shortfalls at the State level. Additional information will be provided as it becomes available.
Therefore, a new FRS expense object code 1823 has been established to account for the 1.36% portion of the Employer Contribution for State Retirement. Existing FRS expense object code 1822 will account for the 9.15% portion of the Employer Contribution for State Retirement.