PERS; require any terminated plan to pay net pension liability to board in a lump sum before termination.

2025 Regular Session Introduced by David Blount and 1 co-sponsor

Requires terminating PERS employers to pay their net pension liability to the PERS Board in a single lump sum before termination.

Died In Committee

#accountability #efficiency #transparency #rules #stateaffairs

Summary — SB 2794

Title: PERS; require any terminated plan to pay net pension liability to board in a lump sum before termination
Introduced: March 14, 2025
Status: Died In Committee (record shows 2025-03-04); legislative record also shows additional committee activity and an adopted amendment in May 2025 (see Procedural History)

Purpose / Intent

SB 2794 would require any employer or local plan that terminates participation in the Public Employees Retirement System (PERS) to pay its net pension liability to the PERS Board in a single lump-sum payment prior to termination. The bill’s intent is to ensure terminating employers fully satisfy their outstanding pension obligations so remaining PERS participants and the system are not left bearing unfunded liabilities.

Key provisions

Requires a terminating plan or employer to pay the plan’s calculated net pension liability to the PERS Board in a lump sum before termination takes effect.

(From available amendment) An adopted committee amendment removed a statutory repeal/sunset date that had previously been in the text (language repealing the provision on June 30, 2025 was deleted).

The document provided does not include full statutory text detailing the calculation methodology, timing deadlines, allowable payment sources, or exceptions; those specifics would determine implementation mechanics (actuarial valuation method, date of valuation, interest, amortization, hardship exceptions, etc.).

Who would be affected

Terminating employers or local plans that participate in PERS (e.g., municipal entities, school districts, special districts).

PERS Board and system finances (receives immediate payments instead of future amortized contributions).

Employees and retirees of terminating employers (indirectly, through potential changes in employer financial decisions).

Taxpayers and local government budgets (terminating entities may face immediate large cash outlays).

Potential impacts / considerations

Pros: Reduces risk that unpaid termination liabilities shift to remaining employers or the pension system; accelerates funding of pension liabilities.

Cons: Could impose severe short‑term cash strain on terminating employers, potentially forcing use of reserves, debt issuance, service cuts, or other fiscal actions. Fiscal impact depends on size of net pension liability and whether payment may be financed.

Implementation requires clear actuarial rules and administrative procedures; absence of that detail in the provided text leaves open practical questions.

Procedural history and current status

Bill filed March 14, 2025; referred to relevant committees (State Affairs; Accountability, Efficiency, Transparency; Criminal Justice/Criminal Jurisprudence in some entries).

Committee hearings, testimony, and multiple committee reports are recorded; Amendment No.1 (committee substitute) was adopted in May and removed a June 30, 2025 repeal clause.

The legislative log contains inconsistent entries (some indicating passage steps in May, and also a “Died In Committee” entry dated 2025-03-04). Official status listed in the provided bill header: Died In Committee. Because the procedural record appears mixed, consult the official legislative archive for the definitive final disposition and full bill text.