What You Don’t Know About Your LEOFF 1 Pension Fund.

The decades of lobbying by the RFFOW to protect the LEOFF 1 pension fund has paid off.  A Washington State Actuary Report (the "Report"), presented to the LEOFF 1 Disability Board Educational Conference on May 12, 2022, reveals that the LEOFF 1 Pension Fund is likely the best funded pension fund in the entire United States.  At least it can be assumed to be in the top 1% of pension funds. The full report, referred to in this post, can be found by clicking on this link: Actuarial Report.

Thus, page 12 of the Report, shown below, contains a graph depicting the nationwide funding status of pension funds as documented by the National Association of State Retirement Administrators.  You will notice on the left side of the graph; Chicago Fire's pension fund is only 20% funded.  On the far right of the graph, it shows the LEOFF 2 pension fund, funded at 113%, as being in the top 2% of funding for pensions. Given that the LEOFF 1 pension fund, in 2020 figures, was funded at 148% (page 9), such funding far exceeds the 2 percent category in which the LEOFF 2 pension fund finds itself.

Moreover, if standard actuarial assumptions are applied, the LEOFF 1 pension fund will be 176% funded by 2023 (page 7).  Importantly, there is a nearly 2-billion-dollar surplus in the LEOFF 1 Pension Fund (see page 6).  The cost to the nearly 2-billion-dollar surplus for the benefit payout of SSB 5791 (the recent legislation granting a lump sum payment to LEOFF 1 retirees) is 155 million (see page 17), a very small portion indeed.

There are a few other highlights to point out:

As shown on page 4 of the Report, as of June 30, 2021, there were still 13 active LEOFF 1 members (average age 68), 2,172 service retirees (average age 77), 2,658 retirees with disabilities (average age 76), and 1,686 survivors (average age 79).  This means that as of 2021 there were 6,529 participants remaining in the LEOFF 1 system.

The average benefit for service retirees was $70,700, disability retirees was $49,300, and for survivors it was $50,100 (see page 4).

To see the entire report click here: Actuary Report.