Trustees of the Arkansas Public Employees Retirement System voted last week to increase the contributions required of state and local governments for the fourth year in a row.
The rate will go to 14.88% of annual payroll from the current 14.24% on July 1, 2013. The increased rate will bring in an additional $10 million a year, according to officials.
The retirement system posted a negative 3.33% investment return in fiscal 2012.
The investment value fell to $5.9 billion as of June 30, down from $6.02 billion at the end of fiscal 2011.
Trustees asked system actuaries to determine the cost of increasing the minimum retirement age needed to receive full retirement benefits, as well as the years of service needed to qualify.
State and local employees in the plan can retire with full benefits after 28 years or service, or at 65 with at least five years of employment.
Governments are expected to contribute $250 million to the system in fiscal 2014 with the higher rate, based on a total payroll of $1.7 billion.
Contributions in fiscal 2013 will total $241 million.
The system is the second largest public retirement plan in Arkansas.
Participants in the system include 46,000 employees and 27,400 retirees.