Date: Wed, 10 Dec 2003 14:35:59 -0800
From: orp@hr.uoregon.edu
To: orp@hr.uoregon.edu
Subject: [ORP] Optional Retirement Plan Employer Contributions

This information is an update about some changing and not yet resolved
question about the Optional Retirement Plan. You may be aware that
other Oregon University System (OUS) institutions sent information
out about the decrease in the Optional Retirement Plan (ORP) employer
contribution rates.  However, after learning that the new
rates were most likely not accurate, the UO decided to hold the letters
to ORP participants until corrected rates were available.  As soon as
we receive the correct employer contribution rates, we will send them
to you.  The six percent employee contribution paid by the UO is not
changing. 
 
Let me explain why the ORP employer contribution rates changed. 
The ORP was not affected by the Public Employees' Retirement System
(PERS) reforms passed by the legislature, with two exceptions.  1) 
PERS rules affect the initial eligibility requirements for the ORP and
2) the PERS employer contributions determine what the ORP employer
contributions will be.  PERS was able to reduce their unfunded
actuarial liability (UAL) through the sale of general obligation bonds
and as a result, the PERS employer contribution rate decreased as of
November 1, 2003.  The ORP rates also decreased correspondingly.  
However, both OUS and the institutions have serious reservations
regarding the accuracy of the new ORP employer contribution rates.  
 
OUS and the institutions are working on some short-term solutions to
obtain the correct rates and also a long-term solution to determine the
ORP rates.  We are hopeful that OUS will have the correct rates in late
December or early January.
 
Unfortunately, the preliminary rates were implemented in November as
required so there was a decrease in your ORP employer contribution for
November.  If ORP adjustments are made, as we hopefully expect, we
anticipate adjustments in the contributions will be made
retroactively.  We will let you know as soon as we hear from OUS
regarding the ORP employer contribution rate.  
 
OUS is responding to inquiries regarding the ORP rates as follows:
 
"OUS announced the rates provided us by the PERS' actuary.  Although we
are required to use the rates provided, we are looking at this very
carefully to see if the assumptions used are correct."
 
I apologize that we don't have more information at this time, but want
you to know OUS and the institutions are continuing to work on this
problem and hope to resolve it soon. 

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