2021-02-18                     House Journal                      Page 0137
HB 75                                                                                                                         
HOUSE BILL NO. 75 by the House Rules Committee by request of                                                                    
the Governor, entitled:                                                                                                         
                                                                                                                                
     "An Act relating to employer contributions to the Public                                                                   
     Employees' Retirement System of Alaska; and providing for an                                                               
     effective date."                                                                                                           
                                                                                                                                
was read the first time and referred to the Labor & Commerce and                                                                
Finance Committees.                                                                                                             
                                                                                                                                
The following fiscal note(s) apply:                                                                                             
                                                                                                                                
1.  Fiscal, Office of the Governor/Retirement Payments                                                                          
2.  Fiscal, Office of the Governor/Various Departments                                                                          
                                                                                                                                
The Governor's transmittal letter dated January 19 follows:                                                                     
                                                                                                                                
"Dear Chief Clerk:                                                                                                              
                                                                                                                                
Under the authority of Article III, Section 18 of the Alaska                                                                    
Constitution, I am transmitting a bill relating to employer                                                                     
contributions to the Public Employees' Retirement System (PERS).                                                                
                                                                                                                                
This bill requires the State of Alaska, as an employer, to pay the                                                              
actuarially determined normal cost and past service cost at the                                                                 
contribution rate annually adopted by the Alaska Retirement                                                                     
Management Board under AS 37.20.220 for all actively employed                                                                   
defined benefit PERS members. The bill requires the State of Alaska,                                                            
as an employer, to pay the actuarially determined normal cost and all                                                           
contributions required under AS 39.30.370 and AS 39.35.750 for all                                                              
actively employed defined contribution PERS members. This change                                                                
will allow the State to collect plan benefit costs across its entire                                                            
payroll base regardless of funding source. Significantly, the bill does                                                         
not change contribution rates for other PERS employers.                                                                         
                                                                                                                                
Currently, as an employer, the State of Alaska contributes 22 percent                                                           
of base salaries for all actively employed PERS members on a payroll-                                                           
by-payroll basis. In addition, under AS 39.35.280, the State is required                                                        
to make an additional contribution on behalf of its employees towards                                                           

2021-02-18                     House Journal                      Page 0138
the plan's past service liability. The bill eliminates the requirement for                                                      
the State to make these additional contributions on behalf of its                                                               
employees, as that amount will now be paid directly to the system by                                                            
applying the board adopted actuarial contribution rate.                                                                         
                                                                                                                                
This bill provides increased flexibility to the State of Alaska as an                                                           
employer, without impacting other employers and while continuing to                                                             
ensure the soundness and stability of the PERS system.                                                                          
                                                                                                                                
I urge your prompt and favorable action on this measure.                                                                        
                                                                                                                                
Sincerely,                                                                                                                      
/s/                                                                                                                             
Mike Dunleavy                                                                                                                   
Governor"