DE Governor Signs Pension Reform

May 5, 2011 ( – Delaware Governor Jack Markell has signed legislation designed to reign in state retiree pension and health care costs.

The Newark (Delaware) Post reports that the legislation requires future state employees to pay 5% instead of 3% of their salary towards their pension after the first $6000 earned and increases the time required to be vested in the state pension system.   

For new employees, the plan also eliminates the “double state share” health care benefit for future employees and will not count overtime towards future employee pension calculations, the news report said. Existing state employees will pay slightly more each month for their health care (see Pension and Health Benefit Changes Approved in DE House).  

It is projected that the annual cost increases for health and pension will be reduced by over 53% per year in the first five years and by nearly 70% by year 15, saving taxpayers over $130 million in the next five years and over $480 million in the next 15 years.