North Dakota Group Proposes Ways To Decrease Burden of Pension Costs on Schools, Teachers

North Dakota

Like in many states, North Dakota schools are finding their budgets strained by pension payments to the state’s teacher retirement system.

North Dakota’s Teachers’ Fund for Retirement is currently 62 percent funded, and contribution rates for teachers and districts have spiked in recent years to improve the system’s funding.

In a bid to reduce the burden on school districts and teachers, the North Dakota School Boards Association has made several proposals to lawmakers. From Inforum:

[Fargo School Board member Jim] Johnson and the school boards group want lawmakers to consider one or more of several options to rebuild the teachers’ retirement fund. They include:

* A series of catch-up allocations from the state’s general fund sufficient to fund TFFR at 100 percent. “It seems to me that they have a fund balance in Bismarck,” Johnson said. It “makes tremendous sense to me.”

* A separate state appropriation that gives school districts an annual amount equal to 5 percent of their certified staff payroll.

* A rollback to pre-2008 TFFR contribution levels, when the plan was funded at 70 percent of its long-term liabilities. The state would pay the post-2008 difference in contribution rates until the plan was 100 percent funded.

* An agreement to study the current funding system for TFFR and explore other solutions.

Teacher contribution rates have risen from 7.75 percent of salary (in 2008) to 11.75 percent in 2014. Meanwhile, school payments have risen from 8.75 percent of payroll (in 2008) to 12.75 percent now.


Photo credit: “Flag-map of North Dakota” by Darwinek – self-made using Image:Flag of North Dakota.svg and Image:USA North Dakota location map.svg. Licensed under CC BY-SA 3.0 via Wikimedia Commons –

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