The school system’s unfunded liability is the difference between the actuarial rate of 36.77 percent it previously paid to the Fund and the 11 percent rate that was remitted to the agency pursuant to Public Law 16-2.
The accrued liability includes interest incurred for the system’s local and federally funded employees.
PSS has over a thousand employees including nearly 300 funded by federal programs.
For its local hires, PSS incurred a $4.6 million accrued liability and $1.2 million in interest.
For federally funded personnel, PSS recorded $1.8 million total accrued liability plus interest.
This $7.6 million total liability was not funded in the school system’s budget.
Due to the big shortfall projected by the Retirement Fund, its trustees have decided to stop processing the retirement papers of employees whose employer’s contribution is delinquent.
There were two PSS employees affected by the Fund’s decision: former Commissioner of Education David M. Borja and classroom teacher Cecilia Labausa who retired this fiscal year.
But PSS paid deficiencies totaling $32,000 for both.
PSS said it has been faithful in paying its contributions to the Fund, which amount to $130,000 for each pay period.
PSS has a budget of $35 million but needs $64 million for FY 2009, which begins on Oct. 1.
