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Governor Proposes Underfunding VRS to Save Money for FY2011

posted Feb 27, 2010, 5:53 AM by Alexander Romero
Source:  FCPS Bottom Line Newsletter

The governor, house, and senate also proposed reducing the contribution that localities (such as Fairfax County Public Schools) pay into the Virginia Retirement System (VRS). The VRS is the major retirement system for FCPS employees, but it is controlled by the state, which defines the benefit levels for employees and the required contribution for local school systems. Any reduction in the rate would need to be made up for in future years, meaning larger increases in the contribution that FCPS must make in outgoing years. If the state adopts the reduced rates as proposed, this would reduce expenditures in FCPS' budget for next school year. However, this short-term fix has long-term consequences.