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Employer rate summary

2025-27 Employer Contribution Rates

This page is a summary of changes since the last rate-setting valuation. The changes explain why a change in employer contribution rates for the 2025-27 biennium is necessary.

The new employer contribution rates are effective for pay dates beginning July 1, 2025. These rates were adopted by the PERS Board on October 4, 2024. You can read additional rate details in the 2023 valuation reports posted on the Actuarial Valuations webpage.

View the PERS 2025-27 Summary of Employer Contribution Rates (PDF)

Changes since the last rate-setting valuation

  1. Cumulative 2022 and 2023 asset returns of the Oregon Public Employees Retirement Fund (OPERF) were less than assumed (6.9% annually), falling short of expectations by nearly $8 billion.

    • In 2022, the OPERF lost 2.01%; in 2023, the OPERF earned 5.98%.
    • These poor returns reduced the funding ratio and increased the unfunded actuarial liability (UAL) of the fund, which would suggest an increase to rates for the 2025-27 biennium except for the payroll growth experienced.

  2. System payroll grew more than 9% during 2022 and 10.5% during 2023.

    • The actuarial assumption is 3.4% system payroll growth annually.
    • Because valuation payroll is used to calculate the UAL rate, the UAL rate did not increase despite the increase in UAL.
    • The increase to payroll, combined with poor investment performance, caused side account offset rates to drop significantly from the last biennium.

  3. Although not new to this rate-setting valuation, the provisions of Senate Bill 1049 (2019) continue to have an impact on rates.

    • A member redirect offset will be applied to your normal cost rate.
      • 2.40% for Tier One/Tier Two payroll.
      • 0.65% for Oregon Public Service Retirement Plan (OPSRP) payroll.
        • The 0.10% difference between the actual member redirect amount (2.5% for Tier One/Tier Two, 0,75% for OPSRP) and the offset to your normal cost rate is due to some members earning less than the current monthly salary threshold for member redirect (find the member redirect salary threshold on the EPSA Overview webpage, section “Does EPSA Apply to Every PERS Member?”).
    • Employer contributions are paid on salary for rehired retirees. Salaries paid to retirees are not considered when calculating an employer’s valuation payroll.
    • Subject salary used for PERS benefit calculations and contributions is limited to the salary limit in effect for each calendar year. Find this year’s salary limit on the employers’ Salary Limit webpage.

  4. The State and Local Government Rate Pool and the School Districts Pool have a rate collar adjustment of (0.32%) and (2.21%), respectively.

    • This means that the employer contribution rates are higher than they would be in the absence of the rate collar.
    • The rate collar was modified in 2021 so that UAL rates will not decrease unless certain funded status thresholds are met.
    • This change prevents premature reduction of employer contribution rates and thus improves funding adequacy over the long term.

Considerations for valuations reports and contribution rates

When reviewing the valuations or contribution rates, please consider the following:

  • Rates in this valuation only reflect data from January 1, 2023, to December 31, 2023.
  • The 2025-27 employer contribution rates report (PDF) is arranged by actuarial pool, with Independent (non-pooled) employers listed first, followed by School Districts, ending with employers participating in the State and Local Government Rate Pool (SLGRP).
  • Rates are applied based on pay date. These rates are effective for payrolls dated on and after July 1, 2025, even if the pay is for work performed before that date.
  • Rates in this report include normal cost, unfunded actuarial liability (UAL), side accounts (if applicable), transition liabilities/surpluses (if applicable), and retiree healthcare.
  • Rates in this report do not include the 6% Individual Account Program (IAP) contribution, even if the employer is paying the contribution on their employees' behalf.
  • School districts and charter schools without a side account as of December 31, 2023, do not have an individual valuation. They will pay the rates shown under the employer name “School Districts,” employer number 3000, in the 2025-27 employer contribution rates report (PDF).
  • State agencies and some SLGRP-participating local governments pay separate Tier One/Tier Two rates for General Service and Police and Fire employees. The Tier One/Tier Two rates shown in the 2025-27 employer contribution rates report (PDF) are a blend of General Service and Police and Fire employees. Refer to your organization’s 2023 valuation report, available for download on the Actuarial Valuations webpage, for the separate rates for Tier One/Tier Two General Service and Police and Fire employees.

If you have any questions about your employer rates, please email Actuarial.Services@pers.oregon.gov.

Go to the Actuarial & Financial Information for Employers webpage.