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Schwartz: Support the Wyoming Retirement System

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One of the privileges of serving as a Wyoming state representative for the past eight years has been the chance to work with so many of the state’s public servants. I have traveled across this state dozens of times and visited every corner, and during these travels, I have been repeatedly impressed by the caliber of teachers, peace officers, firefighters and state employees that devote their careers to serving the people of Wyoming.

As it turns out, public employees are not only critically important to Wyoming during their career, but well into retirement, too. A recent report highlights how public retirees’ contributions are significant boosters to the state’s economy. The National Institute on Retirement Security recently reported that public retirees’ impact is even greater in small towns and rural communities. This support is especially relevant to Wyoming when we consider that 21 out of 23 of the state’s counties fall into those population categories. In short, retired public employees represent a critical component of the lifeblood of Wyoming communities.

In 2018, Wyoming’s public sector retiree benefits constituted between 1-3% of each county’s GDP. For rural communities that have lost population over the last decade, retiree spending keeps communities afloat.

It should not come as a surprise that Laramie County, home to the state capitol, realizes the greatest benefit of public employee retiree economic contributions making up 2.99% of its GDP. However, Big Horn, Fremont, Goshen, Johnson, Laramie, Niobrara and Sheridan counties’ retiree spending all exceeded 2% of GDP. In Hot Springs County, which lost 6.7% of its population between 2000 and 2018, retirees brought in $4.8 million in benefits, just less than 2% of the county’s GDP.

Workers who decide to pursue a job in the public sector do so knowing that, while they might make less than their counterparts in the private sector, they are contributing toward a pension that will provide a reliable, modest retirement. Unlike some stereotypes would suggest, public retirees are not living lavish lifestyles. In fact, they are living in their communities, supporting local businesses and being good neighbors.

According to the Wyoming Retirement System (WRS), about 87% of state employees surveyed in 2019 said a defined benefit pension is “mostly important” or “very important” in keeping them in their current employment. This benefit is crucial to recruiting and retaining competent and qualified state workers. There are several states that are attempting to curtail this benefit to their workers, and it is noteworthy that Wyoming has not adopted similar policies.

It is in the state’s best interest to support the WRS and continue providing this benefit to public employees. Of the $739 million the WRS paid out in retirement benefits in 2021, $558 million stayed in Wyoming. That is not an insignificant contribution to our state’s economy. We are indebted to these workers who spent their careers making sure government services were provided efficiently and effectively.

While in some states, defined benefit retirement plans have built-in mechanisms that adjust retirees’ benefits to reflect inflation and cost of living increases, Wyoming does not, believing that maintaining the fiscal integrity of the plans is the primary goal and instead leaves those mechanisms to the discretion of the Legislature.

Americans are experiencing the worst inflation in forty years. Wyoming’s annual inflation rate was 9.3% in the last quarter of 2021, more than 2% higher than the national average of 7%, according to the Wyoming Economic Analysis Division. Inflation is especially hard on fixed-income retired public employees who are living on a 2008 retirement benefit with 2022 prices.

It would be wise for the WRS Board of Directors to consider designing a formula or a series of benchmarks, based on the various funding streams, which would support the Legislature in adopting benefit payment adjustments for retirees. Even a slight increase in benefits would be valuable to our pensioners and have a multiplier effect in Wyoming communities.

The Wyoming system is focused around its people and its communities. It is important that we recognize the beneficial contributions that public servants make in our communities both during their career and in their retirement.

Andy Schwartz is a state representative in House District 23 in Teton County.

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