The Board of Supervisors approved a revised pension management policy Tuesday, which will involve sharing more information about the funded status of the County’s pension.
Starting on July 1, the County will begin posting annual reports on its website from the California Public Employees’ Retirement System (CalPERS) as well as a pension policy compliance report that will include the latest funding levels and proposed actions to mitigate pension obligations in the upcoming budget year.
The County is also exploring options to reduce its unfunded pension liability, including incrementally setting aside money each year in its pension trust or making additional discretionary payments on top of the annual pension cost.
These new options would build on steps the Board of Supervisors has taken to reduce the County’s pension liability since 2006. In recent years, that’s included pre-paying the annual unfunded liability amount—saving about a half-million dollars in potential interest—and paying the County’s full annual CalPERS costs every year. The revised policy actions are a result of an extensive review of the initial policy drafted in 2019 and in part a response to a 2023-24 Nevada County Civil Grand Jury Report which recommended that the County come up with a comprehensive plan to eliminate unfunded pension liabilities.
Nevada County’s pension plan is currently about 63% funded, meaning the County has set aside roughly two-thirds of the money needed to cover past retirement benefits for employees. As of 2023, the most recent year statistics are available, the County owed $273.9 million for employee pensions. The cost of paying that off over a 20-year period at 6.8% interest is $449.7 million.
Board of Supervisors Chair Heidi Hall said she was glad to have a discussion about pensions in public. “It’s going to be incredibly important for the public to understand we have a $450 million debt and we are going to be responsible for it for many years.”
Supervisor Sue Hoek said the new pension management policy is a positive step forward. ““I like the transparency and putting this out to the public, so they don’t feel like we’re hiding something all the time,” she said.