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RETIREMENT

Nebraska Retirement System BY SENATOR JEREMY NORDQUIST, District 7

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ebraska policymakers and school employees have a longstanding history of working cooperatively to retain and improve pension benefits while maintaining the strong funding status of the retirement systems for those who serve our public school systems. Over a century ago, in 1909, a defined benefit plan was created for Omaha teachers that was later expanded to include other Omaha school employees. In 1945, at the end of World War II, Senator Jeremy Nordquist, District 7 the Nebraska Legislature estabsponse to the recent severe stock market downturn in lished the state-administered School Employees Retire2009, the state rededicated its commitment by increasment System for Nebraska school employees. Omaha plan ing the .7 percent contribution to 1 percent. Since 1990 members chose not to join the statewide school system, the state has annually contributed an average of $14 and instead retained their separate retirement system. million to the State and Omaha Retirement Systems for The School and Omaha Retirement Systems currently its annual salary compensation percentage, state servserve almost 90,000 active and retired school employice annuity, and purchasing power stabilization commitees. ments. Approximately 30 percent of public pension assets are State and local policymakers have worked together generated through a combination of member, employer with school employees throughout the years to (school district), and state general fund contributions; strengthen retirement benefits while maintaining the the remaining 70 percent are generated by investment strong funding status of the plans. In 1998 the “Rule of earnings. Contribution rates have evolved throughout 85� benefit was passed which allows a member who is at the past 67 years. Initially, members were the only conleast 55 years of age to retire with an unreduced benetributors to the retirement plan. fit when the member’s age and years of total service Contributions from the school districts and the state equal 85. Other important new or improved benefits endid not begin until much later. From 1945 through 1966 acted in the past 15 years include an increase in the formembers contributed a maximum of $120 per year for mula annuity benefit multiplier from 1.73 percent to 2 retirement. Beginning in 1967 the member rate inpercent, the addition of a maximum annual 2.5 percent creased to 3.5 percent and school districts began conautomatic cost-of-living adjustment, and adoption of a tributing to the pension plans. In 1986, the 101 percent minimum floor benefit equal to 75 percent of the purschool district contribution rate match was adopted and chasing power of the member's original retirement benhas remained unchanged. efit. The Legislature made a funding commitment in 1984 Since the creation of the school pension plans, the to both the Omaha and state-administered school plans country has experienced periods of strong economic by enacting a requirement for the state to annually contribute .7 percent of the total annual salaries. In re(continued on page 4)

SPRING 2012

NCSA TODAY

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Profile for NCSA

NCSA Today Magazine, Spring 2012  

NCSA Today Magazine, Spring 2012

NCSA Today Magazine, Spring 2012  

NCSA Today Magazine, Spring 2012

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