IPERS continues to lose money, changes could be on the way - KWWL - Eastern Iowa Breaking News, Weather, Closings

IPERS continues to lose money, changes could be on the way

by Danielle Wagner

CEDAR FALLS (KWWL) One in every ten Iowans is a member of the Iowa Public Employees' Retirement System or IPERS. Members are current or former employees or retirees of government agencies, cities, counties and public school districts.

Some longtime public employees are worried about the future of IPERS, and that future could impact the wallets of all Iowans.

During the last fiscal year, IPERS lost more than $4 billion. This is on top of an anticipated long-term actuarial shortfall of about $2.7 billion.

Toni Rewoldt is one person following IPERS more closely. She works as a housing specialist for the City of Cedar Falls. Her husband retired from John Deere in 1999 and lately she's been thinking more and more about her own retirement.

Rewoldt said several factors play a role in her decision: social security, health insurance and IPERS.

"I hear changes are coming down. I don't know what those changes are, and that'll play a part in what I do," said Rewoldt.

Nothing is decided yet, but changes could be coming because IPERS continues to lose money, billions of dollars in fiscal year 2008.

Rewoldt said she's already required to pay more into IPERS. As she gets closer to retiring, she wants to pay more attention to what's going on with her retirement system.

"I'm trying to. I haven't always done it, but yes I need to," said Rewoldt.

Rewoldt said hopefully any changes to IPERS won't affect her, but if changes happen and she needs to work longer before retiring then that's what she'll do.

"We don't know what's going to happen. Play the cards you we're dealt and do the best you can I guess," said Rewoldt.

Toni Rewoldt advises younger people to start saving, but she admits that's a lot easier said than done.

Any changes to IPERS' pension benefits would need approval from the state legislature. But IPERS officials are exploring options. One option is to make 65 the normal retirement age. Now, retirement follows the "rule of 88" meaning someone can retire once their age and years of service total 88. Another option is to base benefits on the highest five years of salary instead of the highest three years.

It's possible more money could come from Iowa taxpayers to help bail out IPERS.

IPERS' financial trouble is partially blamed on the investment of $500 million in 2007 and 2008 to Westridge Capital Management of California.

Two people with the company are charged in securities fraud. Of the $500 million dollars invested, IPERS has only recovered about $35 million.

Reporter: Danielle Wagner

Powered by Frankly