# State Personnel and Pensions (GSP) ## Title 21. State Retirement and Pension System ### Subtitle 3. Funding #### Section 21-304 (a) (1) In this section the following words have the meanings indicated. (2) With respect to local employees, "aggregate annual earnable compensation" means the total annual earnable compensation payable by a local employer to all of its local employees, calculated as of June 30 of the second prior fiscal year before the fiscal year for which the calculation is made under this section, adjusted by any actuarial assumed salary increases that were used in the actuarial valuation prepared under Sec. 21-125(b) of this title for the immediate prior fiscal year. (3) "Local employee" means a member of the Teachers' Retirement System or the Teachers' Pension System who is an employee of a day school in the State under the authority and supervision of a county board of education or the Baltimore City Board of School Commissioners, employed as: (i) a clerk; (ii) a helping teacher; (iii) a principal; (iv) a superintendent; (v) a supervisor; or (vi) a teacher. (4) "Local employer" means a county board of education or the Baltimore City Board of School Commissioners. (5) "State member" does not include a member on whose behalf a participating governmental unit is required to make an employer contribution under Sec. 21-305 or Sec. 21-306 of this subtitle. (6) "Total employer contribution for local employees" means that portion of the employer contribution calculated under subsection (b) of this section that is attributable to all local employees. (b) (1) Subject to paragraphs (4) and (5) of this subsection, each fiscal year, on behalf of the State members of each State system, the State shall pay to the appropriate accumulation fund an amount equal to or greater than the sum of the amount, if any, required to be included in the budget bill under Sec. 3-501(c)(2)(ii) of this article and the product of multiplying: (i) the aggregate annual earnable compensation of the State members of that State system; and (ii) the sum of the normal contribution rate and the accrued liability contribution rate for State members of that State system, as determined under this section. (2) The amount determined under paragraph (1) of this subsection for each State system shall be based on an actuarial determination of the amounts that are required to preserve the integrity of the funds of the several systems using: (i) the entry-age actuarial cost method; and (ii) actuarial assumptions adopted by the Board of Trustees. (3) For the purpose of making the determinations required under this section: (i) the Employees' Retirement System, the Employees' Pension System, the Correctional Officers' Retirement System, and the Legislative Pension Plan shall be considered together as one State system; and (ii) the Teachers' Retirement System and the Teachers' Pension System shall be considered together as one State system. (4) (i) Subject to Sec. 21-309.1 of this subtitle, beginning on July 1, 2012, and each fiscal year thereafter, each local employer shall pay to the appropriate accumulation fund an amount equal to the local share of the total employer contribution for local employees as provided in this paragraph. (ii) For fiscal years 2013 through 2016, each local employer shall pay to the Board of Trustees its local share, which shall be equal to the following amounts: Local Fiscal Fiscal Fiscal Fiscal Employer Year Year Year Year 2013 2014 2015 2016 Allegany 1,487,742 1,885,754 2,412,465 2,773,677 Anne Arundel 11,493,684 14,568,567 18,637,716 21,428,297 Baltimore City 12,922,862 16,380,092 20,955,217 24,092,793 Baltimore 15,755,802 19,970,922 25,549,002 29,374,395 Calvert 2,835,938 3,594,631 4,598,648 5,287,193 Caroline 793,934 1,006,334 1,287,413 1,480,175 Carroll 4,005,782 5,077,441 6,495,621 7,468,196 Cecil 2,459,819 3,117,889 3,988,747 4,585,973 Charles 3,936,516 4,989,645 6,383,304 7,339,061 Dorchester 656,543 832,186 1,064,625 1,224,028 Frederick 5,893,461 7,470,128 9,556,610 10,987,499 Garrett 664,714 842,544 1,077,874 1,239,262 Harford 5,529,741 7,009,102 8,966,815 10,309,396 Howard 9,821,066 12,448,477 15,925,463 18,309,945 Kent 366,147 464,102 593,730 682,628 Montgomery 27,227,553 34,511,689 44,151,153 50,761,802 Prince George's 19,554,579 24,785,979 31,708,954 36,456,662 Queen Anne's 1,105,527 1,401,286 1,792,679 2,061,093 St. Mary's 2,485,697 3,150,691 4,030,711 4,634,220 Somerset 480,124 608,570 778,550 895,121 Talbot 628,456 796,586 1,019,080 1,171,665 Washington 3,094,113 3,921,875 5,017,294 5,768,522 Wicomico 2,173,593 2,755,091 3,524,616 4,052,348 Worcester 1,271,561 1,611,739 2,061,914 2,370,640 (iii) Beginning in fiscal year 2017, each local employer shall pay to the Board of Trustees its local share equal to the normal contribution rate for the Teachers' Retirement System and the Teachers' Pension System multiplied by the aggregate annual earnable compensation of the local employees of that local employer. (5) Except as provided in paragraph (6) of this subsection, the difference between the total employer contribution for local employees and the local share of the total employer contribution for all local employees shall be the obligation of the State. (6) (i) Subject to Sec. 21-309.2 of this subtitle and as provided under subparagraph (ii) of this paragraph, beginning in fiscal year 2027, each county government shall pay to the Board of Trustees the following amounts: County Government Allegany 1,139,988 Anne Arundel 13,344,016 Baltimore City 12,041,167 Baltimore 15,122,563 Calvert 2,284,705 Caroline 785,750 Carroll 3,661,920 Cecil 1,963,691 Charles 3,900,924 Dorchester 794,625 Frederick 7,899,429 Garrett 428,865 Harford 5,297,751 Howard 9,696,329 Kent 255,179 Montgomery 28,754,528 Prince George's 18,675,337 Queen Anne's 973,835 St. Mary's 2,205,319 Somerset 442,575 Talbot 651,179 Washington 3,279,909 Wicomico 2,379,362 Worcester 1,049,543 (ii) (1) For fiscal year 2026, each county government shall pay to the Board of Trustees on or before January 1, 2026, the amount required under subparagraph (i) of this paragraph. (2) Beginning in fiscal year 2027, each county government shall pay to the Board of Trustees on or before each September 1 the amount required under subparagraph (i) of this paragraph. (iii) Each fiscal year, the amounts paid under subparagraph (i) of this paragraph shall reduce the obligations of the State with respect to the Teachers' Pension System and the Teachers' Retirement System by the same amounts. (c) (1) As part of each actuarial valuation, the actuary shall determine the normal contributions, net of member contributions, on account of the State members of each State system. (2) For each State system, the normal contribution rate equals the fraction that has: (i) as its numerator, the sum of the normal contributions determined under this subsection; and (ii) as its denominator, the aggregate annual earnable compensation of the State members of the State system. (d) (1) Beginning July 1, 2023, each year the Board of Trustees shall set contribution rates for each State system that shall amortize: (i) all unfunded liabilities or surpluses accrued as of June 30, 2023, over the time remaining until June 30, 2039; and (ii) any new unfunded liabilities or surpluses that have accrued from July 1 of the preceding fiscal year over closed periods of: (1) 15 years for experience gains and losses; (2) 25 years for the effect of changes in actuarial assumptions and methods; (3) at least 10 but not exceeding 15 years for the effect of any new legislation; and (4) 5 years for accrued liability resulting from legislation providing incentives for the early retirement of State employees. (2) On recommendation of the system's actuary, for the purpose of mitigating tail volatility in the annual contribution rate, the Board of Trustees may adjust the period of amortization under paragraph (1)(ii) of this subsection for liabilities or surpluses accrued in any fiscal year. (e) The Board of Trustees may not certify contribution rates under this section that would result in a contribution rate below the normal cost, as determined by the system's actuary. --- Md. Code Ann., State Pers. & Pens. (as displayed at mgaleg.maryland.gov, October 16, 2026)