Legislature(2019 - 2020)ADAMS ROOM 519
04/18/2019 01:30 PM House FINANCE
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| Audio | Topic |
|---|---|
| Start | |
| HB79 |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| + | HB 79 | TELECONFERENCED | |
| + | TELECONFERENCED |
HOUSE FINANCE COMMITTEE
April 18, 2019
1:30 p.m.
1:30:57 PM
CALL TO ORDER
Co-Chair Wilson called the House Finance Committee meeting
to order at 1:30 p.m.
MEMBERS PRESENT
Representative Neal Foster, Co-Chair
Representative Tammie Wilson, Co-Chair
Representative Jennifer Johnston, Vice-Chair
Representative Ben Carpenter
Representative Andy Josephson
Representative Bart LeBon
Representative Kelly Merrick
Representative Cathy Tilton
MEMBERS ABSENT
Representative Gary Knopp
Representative Dan Ortiz, Vice-Chair
Representative Colleen Sullivan-Leonard
ALSO PRESENT
Representative Chuck Kopp, Bill Sponsor; Tom Wescott,
Anchorage Police Department, Anchorage; Paul Miranda,
Alaska Professional Firefighters, Anchorage; Jeremy
Conklin, Anchorage Police Department Employee Association,
Anchorage; Tyler Greensfeder, Anchorage Police Department
Employee Association, Palmer; Nathen Ellis, Alaska
Professional Firefighters, Anchorage; Angie Fraize,
Anchorage Police Department Employees Association, Chugiak;
Kevin Johnson, Alaska Professional Firefighters, Fairbanks;
Ken Truitt, Staff, Representative Chuck Kopp.
PRESENT VIA TELECONFERENCE
William Fornia, Actuary, Fellow of the Society of
Actuaries; Kathy Lee, chief Pension Officer, Division of
Retirement and Benefits, Department of Administration;
Justin Doll, Chief Police Anchorage, Anchorage; Justin
Mack, Anchorage Firefighter, Anchorage; Doug Schrage,
Alaska Fire Chiefs Association, Fairbanks; Casey Luecker,
Kenai Fire Department, Kenai; Cody Carver, Bellingham Fire
Department, Bellingham, Washington; Steve Nelson, LEOFF
Plan 2, Olympia Washington; Paul Seaton, Self (Former
Legislator), Homer; Jacob Wilson, Alaska Correctional
Officers Association, Anchorage; Michael Oden, Self, Kenai.
SUMMARY
HB 79 PEACE OFFICER/FIREFIGHTER RETIRE BENEFITS
HB 79 was HEARD and HELD in committee for further
consideration.
Co-Chair Wilson reviewed the agenda for the meeting.
HOUSE BILL NO. 79
"An Act relating to participation of certain peace
officers and firefighters in the defined benefit and
defined contribution plans of the Public Employees'
Retirement System of Alaska; relating to eligibility
of peace officers and firefighters for medical,
disability, and death benefits; relating to liability
of the Public Employees' Retirement System of Alaska;
and providing for an effective date."
1:31:37 PM
REPRESENTATIVE CHUCK KOPP, BILL SPONSOR, introduced
himself. He thanked members for hearing the bill. He read
from a prepared statement:
"Thank you Co-Chairs Wilson and Foster and committee
members for hearing this bill today which I believe
powerfully addresses both themes of our Legislature,
the public safety challenges across our state, at the
heart of which is our recruitment and retention
crisis, and the budget, keeping our fiscal house in
order.
I want to the thank the many municipal and borough
leaders across our state who have so strongly
supported this effort, the Alaska Professional
Firefighters Association, PSEA, Anchorage Firefighter
Local 1264 and the APDEA who have worked for more than
a dozen years to bring forward a retirement plan that
would keep our best and brightest public safety
employees here at home, and God forbid if they perish,
provide their loved ones with a measure of security
into the future. Seated with me is Tom Wescott of the
Anchorage Fire Department.
I served 23 years as a police officer, all here in
Alaska. It was a great honor to serve communities from
Kenai, to Anchorage, to Bristol Bay in the profession.
The best and toughest experiences of my life came with
the job. It was hard on my wife and kids, and hard on
my police family. But I would do it all again.
The job is different, it begins with an oath -As a law
enforcement officer, my fundamental duty is to serve
mankind, to safeguard lives and property; to protect
the innocent against deception, the weak against
oppression or intimidation, and the peaceful against
violence or disorder; and to respect the
Constitutional rights of all to liberty, equality and
justice.
In this work You save people's lives; solve terrible
crimes; walk with people through unbelievable grief
and loss; help people put their lives back together,
and if you're lucky, you help keep lives from falling
apart by being ready and willing to do what is
necessary at the moment it is needed. But it comes at
a cost to our men and women in these professions.
Nobody does this for the money, frankly, you can't pay
people enough to do this job. Run towards gunfire.
Fight violently with bad guys. Confront evil almost
every day. Get hurt. Risk your life. And sometimes
die.
Police and firefighters do all this together. We can
bicker like siblings, but like brothers and sisters,
we are close as hands and feet. On December 25, 2003 I
was working for the Kenai police department when
Senior Patrol Officer John Watson was shot and killed
in the line of duty, we could not recover his body
because the shooter had a clear view of a large area
where he was gunned down with nowhere for approaching
officers to be concealed. It wasn't police officers
that helped us, it was the Kenai Fire Department that
drove an Engine right up to the shooters residence and
turned the truck sidewise blocking his line of fire.
This was not practical, it was not planned, and it was
not safe. But it was necessary. And they did it.
The job is harder now. Less political, public, and
media support for the policing profession, greatly
increased liability for officers personally and for
their municipal and state employers. The small reward
I had for hanging in there through the tough times, a
predictable retirement benefit, has gone away. And now
we have the greatest recruitment and retention
challenge in the public safety professions that our
state has ever seen. You will hear from police and
fire agencies from the North slope to Ketchikan, from
the Bristol Bay to the Kenai Peninsula that they are
losing millions of dollars in training on a regular
basis when new officers and firefighters leave after
getting trained and certified to agencies that officer
a defined benefit retirement.
HB 79 takes the lessons we learned from Tier 3
(unfunded liability due to unaffordable benefits) and
Tier 4 (losing our employees) and brings forward
something brand new that avoids the pitfalls of
earlier plans and provides a sure foundation for
employee retirement planning and employer cost
stability into the future.
Thank you, Mr. Chairman. If I may, I would like to now
turn it over to Tom Wescott of the Alaska Professional
Firefighters Association for some remarks."
1:36:21 PM
TOM WESCOTT, CAPTAIN, ANCHORAGE FIRE DEPARTMENT, read from
a prepared statement.
"I would like to start by thanking the committee for
the willingness to work on this important issue. This
is an issue that is important to the men and women
serving Alaska in public safety jobs. It is also
important to the state as it wrestles with serious
budget issues and a desire to tackle important public
safety problems facing the state. Having experienced
and fully staffed departments is critical when taking
on crime, handling the prison population, or
delivering emergency medical care. Dollars are
crucial, and they are being siphoned off as we are
forced to deal with separations and an already
difficult recruiting process made worse by our benefit
package. That is why labor, and management are united
in our effort to pass HB 79.
That brings me to Tier 4. I will spare the history and
instead just stick to the facts. On the pension side,
Tier 4 provides a 5 percent 401A match - less than a
Social Security contribution. It does not mandate
Social Security or SBS and it makes no distinctions
for public safety careers. You cannot find a plan like
it anywhere in the country. I am aware of 3 different
sets of modeling on how Tier 4 would perform over a
career, and all paint a dismal picture. Our Actuary
William Fornia looked at it and predicted a 31 percent
income replacement after a 25-year career.
The Division of Retirement and Benefits within the
Department of Administration also did some modeling,
and they predicted 38 percent after a 25-year career.
The model had a finite retirement period vs that being
unknown. If you outlived their period, you were out of
money.
Bob Mitchell, the CIO for the state, ran scenarios. He
did not do a model for a 25-year police officer
without SBS or Social Security, but he did a 30-year
teacher without SBS and Social Security and determined
a high likely hood they would run out of money in a
30-year retirement. Two notes - if the average PS
employee where to get 30 years they would be 61 at the
end of their career. That is not always feasible. A
Teacher receive a higher contribution, so our likely
hood would be even worse dues to the lower employer
contribution.
We provided the legislature with a table of PS plans
from every state. You cannot find one like Tier 4 and
no amount of education or salesmanship will change the
reality that the referenced modeling has exposed, this
is not an adequate plan
The described inadequacy leads us to our next set of
problems the recruitment and retention of in demand PS
professionals. Alaska is at a clear disadvantage in
this process. Police officers and paramedics are in
high demand across our nation. we must compete in the
recruitment arena and right now we are doing so with
one hand tied behind our backs.
Once Alaska agencies find an employee and invest time
and money into then there is a need to keep them in
order to get a ROI. The troopers have listed 190,000
as the cost for training a new trooper. Over the last
several years you have heard from DPS as they have
described losing non-retirement eligible employees.
Last year they testified they had lost 67 in the last
3 years alone. That is nearly 13 million dollars
walking out the door. Correction this year testified
to large numbers of separation and talked about the
hollowing out of their agency. I am not here to say
pension is the only factor, but it is no doubt a large
one.
If we look out into the future, we can theorize about
future problems. What PS agencies will look like when
they are staffed by an older workforce that lacks the
financial security to retire. Tier 4 is too new to see
the results, but we are likely to see things like
increased workers comp costs. According to a rand
study in Cal older employees in physical jobs are
going to get hurt more frequently and take
significantly longer to recover. I am fast approaching
50 and I can tell you my body feels a whole lot
different after a fire now than I did when I was 34.
We also may see a struggle to fill upper management as
we see some of our best and brightest leave when they
should be moving up the ranks and becoming sergeants,
captains, and chiefs.
With these problems in mind we set out to find a
solution. A solution that took into consideration the
legitimate concerns of the state and also the real
need for improvement. We started by looking at why
certain plans got into trouble and also why other plan
avoided trouble. How did the most successful plans
manage to stay that way. It was not about reinventing
the wheel but rather copying the best ideas and
avoiding the bad ones. You heard from R&B on Monday
that the state holds all the risk in a DB plan. That
is not HB 79.
HB 79 does 3 things:
• It greatly reduces benefits from Tier 3 levels
• It is built of more conservative assumptions
• It contains mechanisms to share risk and deal
with adverse experience.
Benefits reductions:
There are no paid Pre-Medicare health premiums under
HB 79. Health care accounts for somewhere in the
neighborhood of 36 percent of the PERS liability.
Again, Pre-Medicare premiums are off the table and 100
percent on the participant. Our plan has identical
medical benefits to Tier 4 - health reimbursement
account, post Medicare secondary coverage with 25
years of service. You must be 55 with 20 years of
service to begin collecting a benefit. The COLA
benefit is removed (10 percent for remaining in
Alaska). The final benefit is based on 5 years as
opposed to 3 years. This is a larger smoothing period.
The plan was built on a more conservative 7 percent
expected rate of return. The plan requires steady
consistent funding from both the employee and
employer.
Triggers:
We allow for employee's rates to adjust upward to 10
percent but never below 8 percent. The post retirement
pension adjustment can be withheld from retirees if
the funding falls below 90 percent. When you couple
all the benefit reductions with the best practices and
triggers, you get a reasonable plan with reasonable
risk - A plan that greatly reduces the risk through
benefit reductions and more conservative estimates and
then has built in mechanisms to share risk among
employees, retirees and employers. This is unlike any
plan Alaska has seen.
Alaska faces a real problem related to recruitment and
retention. It should not be shocking that employees
are speaking with their feet. We are not exempt from
the laws of economics. If you offer the most frugal
plan in the nation, we should not be shocked that
individuals with better options elect to act on them.
Sunk cost is a real cost. When individuals are in a
defined benefit plan, they have the sunk cost of time.
That is why we do not see Tier 3 members leaving at
the pace of Tier 4.
Let me close by saying it is totally appropriate for
this committee to consider risk and cost. I only ask
that both sides are measured. We have heard the
testimony on risk and cost and seen the documents.
What is the risk in maintaining the status quo? House
Bill 79 has risk, greatly reduced and shared but still
risk. We don't live in a riskless world. You can't
walk across the street with absolute certainty. A
police officer walking into a domestic disturbance
faces risk, a corrections officer handling a violent
criminal faces risk, a fire fighter entering a burning
structure faces risk. We measure it and then deal with
it appropriately, and that is what we ask of the
legislature.
The problems are real. Management and Labor are
speaking with one voice on this issue. House Bill 79
is the result of years of work. It is a well thought
out, well-constructed plan that is built to address
the problems Alaska faces. I look forward to
addressing the committee's questions and concerns, and
again I thank you for taking the time to work on this
important issue."
1:46:19 PM
WILLIAM FORNIA, ACTUARY, FELLOW OF THE SOCIETY OF ACTUARIES
(via teleconference), introduced himself and the PowerPoint
presentation: "Alaska Public Safety Pension Fix: HB 79."
Mr. Fornia reviewed his credentials on slide 2 titled
"William B. Fornia, FSA Credentials":
Highest Actuarial Credentials Fellow of the
Society of Actuaries (1986)
Enrolled Actuary under ERISA (1984)
Member of the American Academy of Actuaries (1983)
Active in national actuarial organizations
(elected to SOA board)
Author and Frequent Speaker "Still A Better Bang
for the Buck" (with National Institute on Retirement
Security), 2014
"Are California Teachers Better off with a Pension
or 401(k)" University of California Berkeley Labor
Center and Journal of Retirement, 2016
Frequent Testimony to Legislatures and City Councils
Regular Expert Witness (Detroit, Stockton, Puerto
Rico)
Mr. Fornia discussed a sample of his work history listed on
slide 3 titled "Sample Work History":
Corporate actuary for Boeing 1980-1984 Alaska
related experience ARMB first ongoing review actuary
2005-2006
Audited Alaska PERS/TRS actuarial valuations 2009
Former leader of Buck Consultants' Denver retirement
practice
Advisors to labor groups since 2011, including
testimony
Consulting services for 22 statewide retirement
systems in Alaska, Colorado, Missouri, North Dakota,
Oklahoma, Puerto Rico, Utah, Texas, Wyoming and
others. Served as system actuary for most of these
(including CO, MO, ND, OK,WY)
Ongoing consultant to Ohio Retirement Study Council,
including reform
Expert testimony and consulting for pension systems,
governments, and labor groups
Other clients have included the US Department of
State, Cities of Baltimore, New York and Philadelphia,
IBM, US WEST and Ford
1:50:13 PM
Vice-Chair Johnston asked what kind of expert witness Mr.
Fornia had been. [Mr. Fornia's phone connection was lost.]
1:51:28 PM
AT EASE
1:52:24 PM
RECONVENED
Vice-Chair Johnston repeated her question about Mr.
Fornia's expert witness testimony. Mr. Fornia answered that
in Detroit he had been hired by an overseas banker about
the pension obligation bonds that they purchased from the
city regarding the city's declaration of bankruptcy. He
testified in federal bankruptcy court on their behalf. He
explained that the City of Stockton had declared bankruptcy
and he was hired by the municipal bond insurers. He had
also worked for the pension fund for Puerto Rico.
1:55:27 PM
Mr. Fornia continued to slide 4: "Alaska Public Safety
Pension Fix."
Why is change necessary?
? Proposed structure of Public Safety Pension Fix
(PSF)
? Illustration of Financial Projections
Mr. Fornia examined slide 5: "Why is change necessary? Tier
3 provided adequate benefits; Tier 4 does not."
Typical Average Pension Illustration for Police & Fire
Hire Age 31
Retirement Age 56
Years of Service 25
DB Benefit as Percent of Final Average
Compensation (based on Tier 3 provisions) 57%
DCR Benefit as Percent of Final Average Compensation
(calculated based on reduced return and uncertain
longevity) 31%
Reduction of Benefit % due to DCR program 26%
Mr. Fornia indicated that the Defined Contribution
Retirement (DCR) would only return 31 percent of pay in
retirement compared to 57 percent based on Tier 3 Defined
Benefit (DB) provisions. He emphasized that it would be
difficult to retire on the DCR amount. He continued to
slide 6: "Illustration of hypothetical police/fire
benefits: $80,000 Final Average Salary." He pointed to the
chart that showed a 25 year employee would receive
approximately $46 thousand in retirement under Tier 3, $25
thousand under Tier 4 and $21 thousand under Social
Security. He highlighted that Tier 4 was only slightly
better than Social Security benefits, which were not
eligible under the state plans.
Mr. Fornia discussed slide 7 titled "Key Considerations
with PSF":
? DB Plans are more cost effective at providing
retirement benefits
DB pension plans pool "longevity risks"
DB pension plans can maintain a better diversified
portfolio because, unlike individuals, they do not
age
DB pension plans achieve better investment returns
because of professional asset management and lower
fees
? DC Plans are more consistent with individual
responsibility
Benefit is a clearly defined contribution from the
employer and employee to a trust
Benefit is more under the control and full ownership
of the individual
Benefit is much more portable
No risk of unfunded liabilities to employer
Mr. Fornia pointed out that the chart showed the pros and
cons per plan. He explained that DC plans pay large
bequests for employees who die shortly after they retire,
and DB plans do not due to pooling longevity risks. He
reported that the advantages to the DC plan was the absence
of risk to the employer of assuming an underfunded
liability, but poor returns merely shifted the underfunded
liability risk to the employee.
2:01:01 PM
Co-Chair Wilson asked what other states offered the plan
Mr. Fornia was suggesting. Mr. Fornia responded that every
state had differently structured plans. He offered that
South Dakota and Wisconsin had similar plans but not
identical to the proposed plan. Co-Chair Wilson asked if
any other states had similar plans currently in use. Mr.
Fornia responded that South Dakota, Wisconsin, and Colorado
all had similar plans already in place. Co-Chair Wilson
asked if Wisconsin currently had an unfunded liability. Mr.
Fornia could not recall but he thought the plan was at
least 95 percent funded. He knew that the contributions
were stable. He added that any plan could go above or below
its liability. He relayed that any plan would have risk
over a long period of time, but the solution was to act in
the bad years and avoid complacency in the good years.
2:05:44 PM
Mr. Fornia reviewed slide 8 titled "How HB 79 struck a
compromise?":
? Start with 12% fixed employer contribution and
manage plan within that target as possible
? Design current target benefit levels
Consider benefits provided by DCR and latest Mr.
Boyle
? Build in benefit and/or employee contribution
adjustment mechanisms
? Utilize lower discount rate to provide cushion
against adverse experience
Mr. Fornia addressed the last bullet point. He explained
that actuaries used an assumed rate of investment return
when measuring the unfunded liability and typically
actuaries had been too optimistic. He built the current
plan based on a 7 percent rate of return. He thought it was
important to estimate returns conservatively.
Co-Chair Wilson asked if he knew what the fixed employer
contribution was for the State of Alaska. Mr. Fornia
answered that the current employer contribution was 22
percent.
2:07:57 PM
AT EASE
2:10:56 PM
RECONVENED
Co-Chair Wilson interjected that the state had several
tiers of pension plans and was currently on Tier 4. She
wanted to have a comparison between the employer
contribution in Tier 4 versus the plan in HB 79.
Mr. Wescott indicated that the Tier 4 employer contribution
was roughly 8.5 percent. The difference between Tier 4
versus the proposed plan in HB 79 was about 3.5 percent.
Co-Chair Wilson asked whether the employees under the
proposed plan would contribute the same percentage of pay
as employees currently under the Tier 4 plan.
2:13:38 PM
KATHY LEE, CHIEF PENSION OFFICER, DIVISION OF RETIREMENT
AND BENEFITS, DEPARTMENT OF ADMINISTRATION (via
teleconference), clarified that the Tier 4 members do not
pay anything towards the unfunded liability of the other
tiers. The employer contributed 5 percent and additional
contributions for the retiree medical plan, the
occupational death and disability plan totaling 6.70
percent, and the health reimbursement arrangement plan,
which was a flat dollar amount totaling approximately 8
percent. She furthered that employers were required to
contribute 22 percent and anything over the amount required
under the DCR plan was used towards the unfunded liability.
The proposed plan in HB 79 excluded employer contributions
toward the unfunded liability.
Vice-Chair Johnston clarified that the pilot program in HB
79 would not pay toward the unfunded liability. Ms. Lee
responded that her statement was accurate, and the employer
contribution was 12 percent. Vice-Chair Johnston looked at
the fiscal note and asked whether the Department of
Administration (DOA) addressed the issue in the fiscal
note. Ms. Lee responded that DOA had not currently
submitted an actuarial fiscal note. The fiscal note she was
referring to was for administrative costs and she had
recently learned that the actuarial fiscal note would be
available in the following two weeks.
2:16:20 PM
Representative Kopp drew attention to section 16 of the
bill on lines 20-21 that stated the increased contribution
rates were included to cover the accrued actuarial
liability. The contribution rate was set at up to 12
percent by the Alaska Retirement Management (ARM) Board and
any remainder would be directed to the unfunded liability.
Mr. Wescott corrected that the "intention of the bill" was
to continue collecting 22 percent with 12 percent going to
the Public Safety Fix (PSF) plan and the remainder would go
towards the unfunded liability.
Vice-Chair Johnston summarized that the employee rate would
be discounted, and the employer's amount would not change.
Mr. Wescott maintained that Vice-Chair Johnston was
correct.
Co-Chair Wilson requested a side by side analysis of the
plans from the division.
2:18:56 PM
Representative Josephson asked about the new "Tier 5" and
whether Tier 4 employees would be allowed to buy into the
new plan. Representative Kopp relayed that Tier 4 employees
would have an opportunity to buy into the plan. He thought
that only a "subset of eligible employees" would
participate in the plan, because it would be more
attractive to new hires. Mr. Fornia interjected that slide
12 showed how it would work.
Co-Chair Wilson asked Ms. Lee on how the plan will "play
out" 15 years in the future. Ms. Lee indicated that the
actuary report would predict the following 5 fiscal years.
Co-Chair Wilson asked why the actuary could not forecast
farther than 5 years. Ms. Lee indicated they could possibly
extend out to 10 years, but no further. Co-Chair Wilson
requested the 10 year actuarial outlook.
2:21:11 PM
Representative Carpenter suggested that since the plan
would cover new hires no one would retire within the first
10 years. He deduced that the period to analyze was beyond
10 years.
Co-Chair Wilson did not understand why the actuary was only
looking at a 10 year period if it wasn't enough time to
provide answers regarding any unfunded liability. Ms. Lee
relayed that the actuary was not comfortable going beyond
10 years. She could request that the actuary offer an
opinion concerning how the "levers" in the plan would
address an unfunded liability. Co-Chair Wilson wondered
whether Representative Carpenter's deduction was correct
and if there was a way to get such an analysis. Ms. Lee
answered in the negative since the data did not exist. She
could ask the actuaries if they could look at how the
proposed plan would address ongoing liability past the 10
year period. The bill included "some levers" to adjust
contribution rates and cost of living rates if the funding
was impaired.
Mr. Fornia responded that the unfunded liability was the
projection of future benefits and much information would be
available in 10 years regardless of whether anyone retired.
He delineated that the actuaries measured all future
anticipated events. While there would be a projection of
the fiscal impact in the following 5 years, he believed
that it would be beneficial to extend the analysis out into
the future. Over the years if the fund was significantly
underfunded, the state would be able to react. The state
would likely manage the plan proactively within a 15-year
timeframe. He encouraged the actuarial firm to review his
projections as well as the plan projections well into the
future.
Co-Chair Wilson commented that the state was already
carrying a $300 million unfunded liability and wanted to
tread very carefully.
Representative Kopp commented that Co-Chair Wilson's
caution was well taken. He highlighted that the current
liability applied to all state employees. The pilot program
was much smaller than the total pool.
2:26:55 PM
Mr. Fornia turned to slide 9: "Plan Comparison." The chart
showed a comparison of plans between Tier 3 Public Safety,
Tier 4 and PSF. He delineated that the employer
contribution with the PSF plan was 22 percent with no less
than 12 percent going to PSF. The largest change was the
retirement age of 55 with 20 years or 60 without. The
benefit multipliers were the same as Tier 3 Public Safety
and Tier 4. The final average pay that was based on the
highest 3 years under Tier 3 was based on the highest 5
years under PSF. The COLA was eliminated under the PSF
plan.
2:28:09 PM
Mr. Fornia continued to review the plan comparison on
slide 10. The Post-Retirement Pension Adjustment (PRPA) was
Automatic for disabled, over 60 and 5 years retired but for
PSF the benefits were the same as Tier 3 but could be
withheld if plan funding is below 90 percent. The medical
coverage and disability would remain the same as Tier 4.
2:28:50 PM
Mr. Fornia reviewed slide 11 titled "The Changes from the
Old Data Base System":
? Removal of full medical coverage
? Funding level built on more conservative 7% rate of
return vs current 7.38% ARM board uses
? Employee contribution can adjust upward from 8% to
10% ? COLA benefit is eliminated
? PPRA is not automatic and can be withheld if funding
level is below 90%
? Minimum age of 55 year old
? Final average salary is based on high 5 year instead
of high 3 years
Co-Chair Wilson referred to slide 10 and asked about
disability. She reminded Mr. Fornia that he stated coverage
would remain the same as Tier 4 and the slide showed Tier
3. She wondered what was correct. Mr. Fornia clarified that
Tier 3 and Tier 4 coverage was very similar.
Mr. Wescott interjected that Tier 4 provided an option for
the employee to opt back to Tier 3 for 40 percent of the
gross monthly compensation and the employer paid the
contribution. He furthered that when the employee reached
retirement age at 25 years of service the person would have
the option to continue with the 40 percent or take the
amount accumulated under their Tier 4 account.
2:31:26 PM
Mr. Fornia advanced to slide 12 titled "Current Tier 4
members transferring into plan":
? ARM board will create an actuarially equivalent
formula for purchasing time.
? Individual will have 90 days from implementation to
decide on joining plan
? Individual can use their Tier 4 DC account to
purchase service credit or start from 0.
? Tier 4 balance may not be enough to cover actual
time employed
? Example individual with 6 years and $100,000 balance
in Tier 4. ARM board determines the cost of
purchasing 6 years is $120,000. Individual could
elect to just purchase 5 years or pay the difference
between the two amounts and purchase the 6 years.
Mr. Fornia detailed slide 13 and slide 14 titled "Benefit
Comparison." He shared that the left portion of the slide
pertained to Tier III and the right side showed the
proposed public safety fix. He highlighted the public
safety fix attributes as follows:
Public Safety Fix:
Final average salary - final 5 high=$95,564
25 years at age 55 - 57.5%x $95,564=$54,949/12=4,579 monthly
No COLA
Same Formula and criteria, but PRPA is withheld
whenever fund falls below 90% funded.
HRA = 3% contribution and market return over career.
Defined contribution benefit.
Health care only after Medicare eligibility
Final Benefit retiree and spouse =
$54,949 pension + fixed HRA amount
Final Benefit Retiree and family = Same as above
Mr. Fornia summarized the slides. He highlighted that the
PSF benefits were not as generous as the Tier 3 benefits.
He specified the final average salary differences; Tier 3
offered a final high 3 year average salary of $98.374
thousand versus the fix plan at the 5 year average high of
$95,564. He noted the Tier 3 final benefit for the retiree
and spouse receiving a $56.565 thousand pension plus $5.6
thousand of COLA and $19.764 thousand in medical benefits
totaling $81.985 versus the final PSF pension noted above.
2:34:40 PM
Co-Chair Wilson interjected that Tier 3 was no longer
available. Mr. Fornia replied that the comparison to Tier 3
was to demonstrate that PSF would be more stable than Tier
3.
Representative Carpenter asked if the $95,000 average
salary was accurate for Alaska employees. Ms. Lee answered
that it was a reasonable high for a 3 or 5 year average
over a long career.
Mr. Fornia moved to slide 15 titled "Safeguard #1: Reduce
benefits vis--vis Tier 3":
? Minimum Age 55 eligibility
? Five year average salary
? Eliminate Alaska 10% COLA
? Suspend Post-Retirement Pension Adjustment when not
well-funded
? Increase employee and employer contributions up to
2% each if not well funded
Mr. Fornia noted that the idea was to do what was possible
to avoid an unfunded liability.
2:37:03 PM
Mr. Fornia addressed slide 16 titled "Preliminary Cost
Estimates." He reported that the chart depicted the
estimated cost of the proposed Tier 5. The baseline Tier 3
Public Safety Plan based on a return of 8 percent cost 17
.3 percent of pay based on its defined benefit features. He
directed attention to the middle column Based on 7 percent
return and 0.62 percent drop in inflation for PSF. The plan
differences from Tier 3 saved the following percentage
points for the Minimum Age 55 Retirement Eligibility, 1.3
percent; Average Earnings Period to Five Years, 0.7
percent; Eliminate COLA, 0.7 percent; Withhold PRPA if
Underfunded, up to 2 percent; and if underfunded would
Increase Employee/Employer Contributions up to 4 percent.
He reported that the Public Safety Fix Pension Cost would
be 15.7 percent and was contributing 16.9 percent after
health care cost resulting in a Contribution Margin of 1.2
percent and an Additional Margin for Adverse Experience of
6 percent. He favored margins that minimized the downside
risks.
2:39:01 PM
Mr. Fornia turned to slide 17 titled "Safeguard #2:
Actuarial Methods":
? Build in margin in actuarial assumptions
? Build reserves in good times to provide added
funding during bad times
? Compare 12% + 8% = 20% contributions with costs
Above
15.9% for pension based on 7% returns
HRA & Medicare Supplement are another 3.1%
This provides cushion of 1.0%
Additional 6.0% available through PRPA suspension
and additional 2%+2% employee and employer
Mr. Fornia advanced to slide 18 titled "Safeguard #3:
Reduced Discount Rate":
Target the pension and health care benefits to be
equal to latest tier DB
? Determine the costs based on 7% discount rate rather
than 8% or 7.38% assumed by PERS actuary
? Seek additional funding for this level, and then
commit to this fixed employer contribution rate
going forward
This is 12% employer contribution for Police and
Fire employers
This is 8% to 10% employer contribution for
employees
? Monitor experience and adjust benefits and/or
Contributions as necessary going forward
Mr. Fornia restated that he wanted to ensure that the plan
was structured conservatively. The slide showed the reduced
discount rate. Historically the return was based on an 8.25
percent rate. The actuaries had suggested an 8 percent
rate. However, he employed a 7 percent rate to be
conservative. He reminded the committee that benefits would
be adjusted downward at a 90 percent funding level.
2:40:31 PM
Mr. Fornia discussed slide 19 titled "Benefit Plan
Simulations - Baseline":
? We modelled how plan might have worked under various
returns
? If fund earns 6.6% for next ten years, as ARMB
investment consultant estimates, then 7.38%
(consistent with long-term PERS actuarial
consultants) thereafter
Plan will grow to 107% funded by 20 years
Never below 100% funded
Funded ratios based on conservative 7.00%
? Current actuary uses 7.38%
Mr. Fornia related that the following 10 slides showed plan
simulations.
Mr. Fornia reviewed slide 20 titled "Benefit Plan
Simulations - Historical":
? We modelled how plan might have worked under various
returns consistent with PERS returns
? Considering each 20 year period from 1980-2000 to
1998-2008
Median case was if 1994-2004 was replicated
? Never falls below 90%
Worst case was if 1998-2008 was replicated
? Falls below 90% for 2 of those 20 years, by end
would be 99% funded
75%ile best case was if 1985-2005 replicate
? Would be 133% funded after 20 years
Mr. Fornia noted that the slide contained an error and 2008
should read 2018.
2:42:21 PM
Mr. Fornia turned to the graph showing the benefit plan
simulations based on historical information on slide 21.
The orange line represented the average median case from
1994 to 2014. The average case depicted the plan funded at
130 percent in year six and began to fall in 2008 dropping
to the current 100 percent funded. The grey line, starting
in 1998 represented the worst-case scenario dipping twice
when the market dropped in year three and again in 2008
leaving the plan funded under 90 percent in 2014. The 90
percent triggers would have been activated that included
increasing employee contributions by one half percent,
helping the plan recover by 2018 in year 20. The yellow
line depicted the 75th percentile best case scenario that
he favored. The plan would have started in 1985 and reached
a funding level of 160 percent by year 15, falling to 125
percent funded after one market crash. He indicated that
the current slide and slides 22 through 25 attempted to
depict what happened to the plans in the real world.
2:45:58 PM
Representative Josephson suggested that there were two
triggers. The first trigger eliminated the COLA (Cost of
Living Allowance) and the second bumped up the employee
contribution. Mr. Fornia answered that "one trigger fired
three guns." He explained that the trigger suspended the
inflation adjustment, increased the employee contribution
by up to 2 percent, and bumped up the employer
contribution. The Alaska Retirement Management (ARM) Board
had the discretion to control the levers and activate the
triggers according to the situation. He deduced that the
plan's main cost savers beside the triggers were that the
plan did not supply health care between the ages of 55 and
65 and postponed retirement by some measure. Mr. Fornia
responded in the affirmative. He elaborated that delaying
retirement until age 55 for young hires "saved a ton of
money."
Representative Carpenter asked about the activation of
triggers and who was responsible for triggering them. Mr.
Fornia responded that the triggers would be activated by
the ARM Board. He explained that the state's actuary would
forecast the plan's performance and suggest the activation
of triggers if necessary. The ARM Board had complete
discretion on how to activate the triggers.
2:50:26 PM
Representative Carpenter suggested that the legislature
would not have chosen the previous plans had someone warned
of the unfunded liability the state currently had. Mr.
Fornia was not sure how the state made its prior decisions
regarding the state's retirement plans.
Co-Chair Wilson commented that the current legislature was
not present when the prior decisions were made which made
them wary of the predictions for the performance of the
pension fix plan.
Representative Kopp noted that he was the active manager
for the City of Kenai during the previous pension plans. He
recalled that there was "passive management of the trust"
and active audits were not performed; actuaries were sued
over their inaccurate guidance. He concluded that the state
"learned a lot of lessons" from prior management issues.
Vice-Chair Johnston reported that the problems of the past
were caused by a huge actuarial issue and by placing many
different funds "into one basket."
Representative Josephson commented that the bill responded
to the problems of the past by the postponed retirement and
healthcare benefits and triggers and adjustments. He
observed that the plan required retiree participation
through the adjustment mechanisms and felt that it was a
substantial concession by the supporters of the plan.
2:53:28 PM
Representative Kopp responded in the affirmative. He
believed the concession was significant. He relayed his own
personal experience about retiring at age 44 and the
ability to receive benefits. He presumed that the benefit
gap would be a hardship. He offered that the proposed plan
was significantly different than the prior plans.
Co-Chair Wilson halted the presentation due to time
considerations.
2:54:41 PM
Co-Chair Wilson OPENED Public Testimony.
2:55:05 PM
PAUL MIRANDA, ALASKA PROFESSIONAL FIREFIGHTERS, ANCHORAGE,
read a prepared statement:
"My name is Paul Miranda, and I am testifying today on
behalf of the Alaska Professional Firefighters
Association. I am also an 8-year Firefighter/Paramedic
with the Anchorage Fire Department and a Tier 4
member.
Thank you for the opportunity to testify before you
today.
I would like to say thank you to Representative Kopp
and his staff for their work on House Bill 79 and
thank you to the committee for hearing this bill.
In 2006 Alaska began placing all new state and
municipal employees into the new defined contribution
plan known as Tier 4.
Since the change to Tier 4, our state has experienced
many unintended consequences. Perhaps the clearest
consequence is the competitive disadvantage Alaska now
faces in recruiting and retaining public safety
employees. This problem is widespread throughout
Alaska's Fire and Police Departments. It has been
brought to our attention in many letters from Fire and
Police Chiefs from across the state as well as
extensive testimony in House Labor and Commerce.
Alaska is the only state in our country to offer a
mandatory defined contribution retirement plan to
public safety employees, and several jurisdictions
across the country have switched from a defined
contribution plan back to a defined benefit plan
specifically to address the same problems that we are
now seeing in Alaska.
Another unintended consequence from the switch to Tier
4 is the lack of retirement security that Tier 4
provides for our public safety employees, who dedicate
a career to serving Alaska in jobs that take a very
physical and mental toll. For years, our professional
actuary has told us that Tier 4 will be inadequate for
public safety in retirement, however this has now been
validated by testimony of the State Investment Officer
at a 2018 Alaska Retirement Management Board meeting,
as well as additional predictions from the Department
of Administration. There is no longer a question of
whether Tier 4 works for public safety it simply
does not. To make matters worse, most firefighters in
Alaska do not receive social security or SBS. They
only receive a 5% contribution to a 401A account.
To be clear, for Alaska's firefighters, the State of
Alaska contributes less to our Tier 4 retirement
accounts than a social security contribution would be
in the private sector. Let that sink in. This is the
value that the state has placed on our first
responders.
I have heard people say that most of the problems with
recruitment and retention are due to a lack of
information or education of employees about the
benefits of their DC plan. I am here to disagree. The
more I learn about Tier 4, the worse it looks. I AM
educated, and no amount of education will convince me
that Tier 4 is adequate for public safety, or is
competitive with what other agencies
offer their employees.
House Bill 79 aims to make Alaska competitive in the
hiring and retaining of public safety employees. It is
a conservative plan built by incorporating the best
practices of some of the most successful plans in our
country. It works to provide reasonable, competitive
benefits and at the same time protect the state from
adverse experience. It starts out by being built on a
7 percent expected rate of return. This is more
conservative that the return assumptions that the ARM
board uses. Next, it mandates a minimum retirement age
of 55, eliminates the COLA benefit provided in the old
defined benefit tiers, allows the employee
contribution to be adjusted up to 10 percent from the
8 percent minimum, calls for steady consistent
employer contributions, allows the withholding of the
PRPA if funding should fall below 90 percent, uses a
high 5 year average as opposed to high 3 for final
benefit calculation and lastly, uses the Tier 4 health
reimbursement arrangement account as opposed to
providing full pre-Medicare coverage as in previous
retirement tiers.
All of these tools and benefit modifications contained
in House Bill 79 help to build a reasonable and
conservative retirement plan for public safety
employees, reduce risk for the state, make Alaska
competitive in the recruitment and retention of public
safety employees, and provides a secure retirement for
our first responders. This is a bill that both
management and labor strongly agree on. Becoming
competitive will help Alaska's public safety agencies
retain highly skilled employees and better fulfill
their missions and responsibilities to the communities
they serve, as well as preserve important dollars
being lost when employees leave our state.
On behalf of the over 500 professional firefighters in
Alaska, the Alaska Professional Firefighters
Association strongly supports House Bill 79, and
recognizes that it is a good compromise to address the
issues that public safety faces in Alaska today. We
cannot afford to do nothing to address these issues,
the costs are too great.
On a personal note, I was born and raised in Alaska. I
have thought very seriously about leaving. I realize
that the unfortunate reality of what Tier 4 provides
will not be adequate to provide for myself and my
family in retirement. What has kept me here is not
Tier 4 retirement. Maybe I'm na?ve, but I'm an
optimist. What HAS kept me here is my optimism that
the Legislature will recognize this problem and will
do the right thing to fix it.
Thank you for your time."
2:59:56 PM
JEREMY CONKLIN, ANCHORAGE POLICE DEPARTMENT EMPLOYEE
ASSOCIATION, ANCHORAGE, spoke in favor of HB 79. He spoke
to the issue of recruitment and retention. He talked about
opportunities available in other states. Consequently, the
state's lack of defined benefits had left many employees to
take advantage of the opportunities in other states. He
spoke of an employee getting a position in a small town in
Texas. Although the employee accepted a pay reduction of
$300 per month, he received defined benefits in a town with
a much lower cost of living. He urged members to pass the
bill.
3:02:58 PM
TYLER GREENSFEDER, ANCHORAGE POLICE DEPARTMENT EMPLOYEE
ASSOCIATION, PALMER, spoke in support of HB 79. He was a
product of Alaska and a firefighter. However, the lack of
defined benefits was forcing him out of Alaska to another
job out of state. He spoke to the proposed defined benefits
program and urged members to support the bill.
3:06:05 PM
NATHEN ELLIS, ALASKA PROFESSIONAL FIREFIGHTERS, ANCHORAGE,
spoke in support of HB 79. He provided his brief background
as a third generation Alaskan living in Girdwood with two
children and his native Alaskan wife from Chenega. He had
been in Anchorage for the past 12 years. He had been a
firefighter in Nevada prior to that and gave up a defined
benefit job due to his love of family and Alaska. He had a
family and had no intention of leaving the state. He was
told by an orthopedic surgeon that he would need a hip
replacement due to the rigors of the job and would not be
able to handle another training academy at the age of 46.
He desired to remain in his current job. He wanted defined
benefits and asked the state legislature to take care of
its people and to provide a little more support. He urged
support of the legislation.
3:09:19 PM
JUSTIN DOLL, CHIEF POLICE ANCHORAGE, ANCHORAGE (via
teleconference), favored the legislation. He had
operational concerns. He shared that the Anchorage Police
Department (APD) had successfully recruited officers until
more recently. He spoke to the difficulty of retaining
officers that Alaska had trained. The approximately 75 to
80 Tier 4 officers that were vested were very "portable,"
but were experienced and very valuable to APD, who invested
money into their initial and continuing training. He was
very concerned about retaining those officers. He also
spoke to the number of people eligible to retire. Anchorage
was in very good shape presently, but he was concerned that
many officers were due to retire and coupled with the
recruitment and retention issues warranted attention. He
continued to speak about the difficulty of recruiting and
retaining officers under the current tier system.
3:14:00 PM
ANGIE FRAIZE, ANCHORAGE POLICE DEPARTMENT EMPLOYEES
ASSOCIATION, CHUGIAK, spoke in support of the legislation.
She and her husband were both police officers having joined
the force together after they had returned from college.
She emphasized the benefits of being a Tier 3 employee. She
was involved in recruitment and received feedback about the
state not having "an end game" with Tier 4 benefits. She
urged members to consider HB 79. She believed the bill
provided a long-term solution.
3:17:01 PM
KEVIN JOHNSON, ALASKA PROFESSIONAL FIREFIGHTERS, FAIRBANKS,
spoke in favor of HB 79. He was a sixth generation Alaskan.
His grandfather was a member of the Butrovich family. He
was currently an employee of the Fairbanks Fire Department.
He was looking at leaving the state because of the lack of
attractive benefits. He talked about the challenge of
recruiting firefighters under the current tier system. The
department hired 8 recruits in the prior year. He reported
that 6 of the 8 employees were starting to look outside of
the state for employment. He urged support of the bill.
3:19:52 PM
JUSTIN MACK, ANCHORAGE FIREFIGHTER, ANCHORAGE (via
teleconference), spoke to the importance of passing HB 79.
He cited prior testimony by the Division of Retirements and
Benefits that reported the defined benefit plans lead to
unfunded liabilities that rested solely on the state. He
did not believe that was the experience in other parts of
the country with well-run defined benefit plans. He
addressed the pension fix attributes that kept the plan
stable and noted that the state would not offer pre-
Medicare medical benefits. However, he thought that the
plan still provided an opportunity for a "dignified
retirement". He felt that the gap in health benefits was
not ideal and characterized the plan as "modest" but
emphasized that the risk was shared between the employer
and public safety employees.
3:21:50 PM
DOUG SCHRAGE, ALASKA FIRE CHIEFS ASSOCIATION, FAIRBANKS
(via teleconference), spoke in support of HB 79. He
described the issue as a "very real management problem." He
communicated that municipal fire departments had become
"revolving doors" and "training grounds for fire
departments in other states, particularly in the Pacific
Northwest." He explained that firefighters were training in
Alaska, serving their probationary periods and were
subsequently recruited by fire departments in Washington
state that allowed "lateral hires." Lateral hires skipped
the usual training and were offered the post-probationary
pay rate, which saved the fire department training costs.
Consequently, Alaskan fire departments were "perpetually"
recruiting and training which left the state with mostly
newer inexperienced firefighters. He observed that the out
migration of firefighters significantly increased with the
implementation of Tier 4 benefits and fewer Alaskans were
applying for firefighting jobs in the state. He noted that
prior to that, it was virtually unheard of for firefighters
to leave their jobs for employment in other states. Mr.
Schrage urged support of the bill.
3:23:52 PM
CASEY LUECKER, KENAI FIRE DEPARTMENT, KENAI (via
teleconference), supported the bill. He indicated that he
was a firefighter and medic for 9 years. He had seen
several firefighters leave the state due to the ability to
obtain defined benefits in other locations. He spoke of an
experience gap due to the Tier 4 firefighters leaving the
state and the lower Tier firefighters on the verge of
retirement. He was a fifth generation Alaskan and was
considering a lateral transfer to Washington state. He was
a recent father and the experience was driving his decision
to seek defined benefits. He asked members to support the
bill.
3:26:28 PM
CODY CARVER, BELLINGHM FIRE DEPARTMENT, BELLINGHAM,
WASHINGTON (via teleconference), was currently a
firefighter in Bellingham, Washington. He shared that he
grew up in Alaska and worked in Fairbanks, Juneau, and
Anchorage as a firefighter and medic. He wanted to remain
and retire in Anchorage. However, he had to consider a
career which supplied defined benefits due to the lack of
disability benefits in Alaska. He was forced to leave
Alaska. He took a lateral hire job in Bellingham that
included good benefits. He would have never left the state
had it had defined benefits for firefighters and provided
disability benefits for those injured doing their job. He
urged support of the bill.
3:28:57 PM
STEVE NELSON, Executive Director, LEOFF PLAN 2, OLYMPIA
WASHINGTON (via teleconference), He offered a few comments
regarding the state's proposed plan that he was asked to
review. He indicated that the LEOFF plan he represented
began in 1977 and covered all the law enforcement officers
and firefighters in the state with 18 thousand active
member and over 4 thousand retirees. The plan had over $11
billion in assets and was funded at 109 percent. He noted
that the plan had been funded at 100 percent or more since
its inception. He listed the 5 provisions of the pension
fix plan that he supported and believed were best
practices:
• The cost sharing mechanism that allowed contributions
to rise.
• The five year final average salary period also in the
LEOFF plan that prevented salary spiking.
• The retirement age provision of 55 with a twenty year
retirement.
• Conservative actuarial assumptions.
• Medical benefits separated from the pension plan.
3:31:33 PM
PAUL SEATON, SELF (FORMER LEGISLATOR), HOMER (via
teleconference), was involved in recreating the retirement
system in 2005. He urged caution. He indicated that
actuaries across the country had a terrible track record of
making correct assumptions over time. In 2003, the state
had $15.6 billion in unfunded scheduled payments. He stated
that "the actuarial assumption had eaten the state's
lunch." He believed that treating police and firefighters
separately from other state employees was discriminatory.
He reiterated his plea for caution.
3:34:23 PM
JACOB WILSON, ALASKA CORRECTIONAL OFFICERS ASSOCIATION,
ANCHORAGE (via teleconference), spoke in support of HB 79.
He thought Alaska was in the middle of the largest
retention and recruitment crisis in the state's history due
to the loss of defined benefits. He cited a report from
2016 by Alaska's Department of Corrections (DOC) that found
several facilities operating at staffing levels
insufficient to meet basic security operational
requirements. The state lost 540 correctional officers
since 2014, which equated to over 60 percent of its
workforce and cost the state $15 million annually. He
provided some additional statistics. He reported that the
current number of 110 Tier 4 officers with 4 to 5 years of
service would drop by more than half to 45 officers with 5
to 6 years of service decreasing to 35 officers in the 6 to
7 years of range. Many move on to other states with defined
retirement and benefit systems. New officers lacked the
experience that the more experienced officers provided. He
urged support of the bill.
3:36:58 PM
MICHEAL ODEN, SELF, KENAI (via teleconference), urged
support of the bill. He had been a firefighter in Kenai for
the past 4 years. He came from a long line of firefighters.
He had received training at UAF (University of Alaska
Fairbanks). Many of his classmates had left the state
seeking positions that provided defined benefits. He spoke
of the dedication of Alaskas public safety officers and
felt that they needed to be taken care of by a defined
benefit program. He talked about the increase of Worker's
Compensation claims. He mentioned having to load and unload
patients over 300 pounds in his capacity as a medic. He
urged members to support HB 79 in order to keep trained
public safety officers in the state rather than letting
them leave Alaska. He noted the ease of transferring
training to other states. He stressed that a pension was
necessary to retain officers and keep people in the state.
3:41:37 PM
Co-Chair Wilson CLOSED Public Testimony.
Representative Josephson asked Mr. Greensfeder to hang in
there for another year. He did not want to lose him to
another state and felt that the administration would
support the bill. He wondered how the disability benefit
worked apart from Workers Compensation. Representative Kopp
replied that a disability benefit was available to the
employee immediately versus a worker's compensation claim.
He deferred to Mr. Wescott for the answer.
3:43:35 PM
Mr. Wescott replied that the bill did not solve every
problem and thought the medical coverage gap was
problematic. He relayed that in his experience he had seen
many work past the age of 55. However, he had also seen
other medical issues impair public safety officers to the
extent that they could not make it to 55 to retirement. He
offered that the pension fix plan did not provide enough to
live on considering the healthcare gap and required
personal responsibility to plan for the eventuality. In
contrast, everything was individualized and market-based
under Tier 4. He summarized that the plan fix required that
the individual plan and save for retirement while still
providing a more stable benefit.
3:45:15 PM
Representative Josephson stated that the diminution of
benefits was illegal under the state's constitution. He
asked whether the sponsors had legal concerns. Mr. Wescott
responded that due to the fact the plan clearly stated that
full benefits were predicated on the plan's funding level
staying above 90 percent, it was not considered a
diminishment.
KEN TRUITT, STAFF, REPRESENTATIVE CHUCK KOPP, indicated
that Mr. Wescott's answer was sufficient. He added that the
language built into the bill would avoid a constitutional
issue.
Co-Chair Wilson relayed that the bill would be set aside.
Co-Chair Wilson reviewed the agenda for the following
meeting on Monday, April 22, 2019.
HB 79 was HEARD and HELD in committee for further
consideration.
ADJOURNMENT
3:47:50 PM
The meeting was adjourned at 3:47 p.m.
| Document Name | Date/Time | Subjects |
|---|---|---|
| HB079 W.Fornia PSF-Presentation to House Finance 4.16.2019.pdf |
HFIN 4/18/2019 1:30:00 PM |
HB 79 |
| HB079 Additional Information DPS Recruitment-Retention Plan Overview 4.2.2019.pdf |
HFIN 4/18/2019 1:30:00 PM |
HB 79 |
| HB079 Finance Rep Kopp Introduction Presentation 4.2.2019.pdf |
HFIN 4/18/2019 1:30:00 PM |
HB 79 |
| HB079 Additional Information DPS Commissioned Employee Engagement Survey Results Overview December 2017 4.2.2019.pdf |
HFIN 4/18/2019 1:30:00 PM |
HB 79 |
| HB079 Sectional Analysis ver U 4.2.2019.pdf |
HFIN 4/18/2019 1:30:00 PM |
HB 79 |
| HB079 Sponsor Statement ver U 4.2.2019.pdf |
HFIN 4/18/2019 1:30:00 PM |
HB 79 |
| HB079 W.Fornia PSF-Presentation to House Finance 4.16.2019.pdf |
HFIN 4/18/2019 1:30:00 PM |
HB 79 |
| HB79 PERS Tier Comparisons for Bill 4.12.2019.pdf |
HFIN 4/18/2019 1:30:00 PM |
HB 79 |
| HB 79 NEW FN DOA CAS.pdf |
HFIN 4/18/2019 1:30:00 PM |
HB 79 |