Moving thousands of KPERS’ members from tier 3 to tier 2 may cost state $220M
BY: TIM CARPENTER
Kansas Reflector
TOPEKA — Blue Valley school district superintendent Tonya Merrigan could simply look to a group of classroom teachers for reasons the Kansas Legislature should transfer thousands of public school educators to a more financially advantageous retirement plan.
A proposal examined by a House committee would shift certified teachers — but not all school employees — from the modest tier 3 plan in the Kansas Public Employee Retirement System to the more robust tier 2 plan in KPERS.
The difference in terms of retiree benefits would be significant because a tier 3 member leaving the profession at age 60 with 30 years of teaching experience could receive $26,000 to $36,000 annually from KPERS. A teacher enrolled in KPERS’ tier 2 with the same combination of age and service would earn $45,000 per year in retirement.
Merrigan said reassigning teachers to the better retirement plan as envisioned in House Bill 2129 would have a positive influence on teacher retention and recruiting.
“As our local economy continues to grow, Blue Valley often finds itself competing with not only other local school districts for employees, but with districts in Missouri as well as the private sector,” she said. “If we want to remain competitive, we must continue to offer robust retirement plans as part of our compensation package.”
The House Financial Institutions and Pensions Committee didn’t attract opponents to the bill at Wednesday’s hearing. Direct endorsements came from superintendents of the Olathe, Topeka, Gardner Edgerton and Blue Valley districts as well as the Kansas Association of School Boards and Kansas PTA.
Conditional support was offered by the Kansas State Board of Education and Kansas-National Education Association, both of which urged lawmakers to relocate other district employees — rather than just certified teachers — from tier 3 to tier 2.
KPERS’ tier 3 was established with a bill signed in 2012 by then-Gov. Sam Brownback. Individuals hired after January 2015 could enroll in tier 3, which was designed to reduce monetary obligations of Kansas taxpayers by raising the mandatory employee contribution and offering newcomers a benefit more akin to a 401(k)-style account.
The resulting benefit gap within KPERS has proven such an irritation that state employees, including House and Senate members, have denounced tier 3 as deeply flawed.
Alan Conroy, executive director of KPERS, said the one-time cost for the state to absorb the unfunded liability of transitioning teachers from tier 3 to tier 2 would be about $220 million. If the state decided to cover that liability over a 20-year period, the cost would be $18 million annually.
Shannon Kimball, who lobbies for the Kansas Association of School Boards, said improving KPERS benefits was important to the future of the teaching profession in Kansas. Local school boards were eager for teachers to make the leap from tier 3 to tier 2, she said.
“An improved retirement benefit would not only attract young people to the profession, but also encourage experienced teachers to remain in the classroom,” she said.
In October 2024, the Kansas State Board of Education reported public school teaching vacancies in the state had risen from 1,600 in the fall of 2022 to 1,950 in fall 2024. The National Center for Education Statistics found Kansas ranked second in the nation in terms of teachers exiting the profession. And, in the past decade, the number of students entering teacher preparation programs nationwide has declined by as much as 45%.
State Board of Education member Cathy Hopkins said the board endorsed HB 2129. However, she requested the measure be amended to include all personnel “essential to the operation of our schools.”
Tim Graham, lobbyist with the state’s chapter of the NEA, said there was widespread agreement the state’s teacher shortage was significant and tier 3 of KPERS was an inadequate retirement option for public employees.
He concurred that school counselors, librarians, nurses, paraprofessionals and other staff ought to be included in the sweeping move away from tier 3.
“There is widespread agreement that something needs to be done, but this issue keeps getting pushed to the bottom,” Graham said.