Annual Financial Report 2024 2025

Virginia Tech Financial Report 2024-2025

20. Defined Contribution Plans Optional Retirement Plans

Full-time faculty and certain administrative staff may participate in optional re tirement plans as authorized by the Code of Virginia rather than the VRS retirement plan. These optional retirement plans are defined contribution plans offered through Teachers Insurance and Annuity Association of America – College Retirement Equi ties Fund (TIAA-CREF), and Fidelity Investments Tax-Exempt Services Company. There are two defined contribution plans. Plan 1 is for employees hired prior to July 1, 2010, and retirement benefits received are based upon the employer’s 10.4 percent contribution, plus net investment gains or losses. Plan 2 is for employees hired on or after July 1, 2010, and retirement benefits received are based upon the employer’s 8.5 percent contribution and the employee’s 5.0 percent contribution plus net investment gains or losses. Individual contracts issued under the plan provide for full and imme diate vesting of both the university’s and the employees’ contributions. Total pension costs under this plan were approximately $44,793,000 for the year ended June 30, 2025. Contributions to the optional retirement plan were calculated using the base salary amount of approximately $496,464,000 for this fiscal year. Deferred Compensation Plan Employees of the university are employees of the Commonwealth of Virginia. State employees may participate in the commonwealth’s deferred compensation plan. Participating employees can contribute to the plan each pay period with the com

monwealth matching up to $20 per pay period. The dollar amount match can change depending on the funding available in the commonwealth’s budget. The deferred compensation plan is a qualified defined contribution plan under Section 401(a) of the Internal Revenue Code. The university expense for matching contributions to this plan, which is an amount assessed by the commonwealth, was approximately

$2,633,000 for the fiscal year 2025. Federal Pension Plans

Certain Cooperative Extension Service (CES) professional employees are partic ipants in the Federal Employee Retirement System (FERS). The FERS is a defined benefit plan in which benefits are based upon the highest base pay over any three consecutive years and the years of creditable service. The costs under this plan were approximately $71,000 for the year ended June 30, 2025. Contributions to FERS were calculated using the base salary amount of approximately $384,000 for the fiscal year 2025. In addition, the university contributed $19,000 in employer contributions to the Thrift Savings Plan for the year ended June 30, 2025. The Thrift Savings Plan is a defined contribution plan in which the university matches employee contributions within certain limitations.

Photo by Chase Parker/Virginia Tech

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