Legislature(1999 - 2000)
03/21/2000 01:37 PM Senate L&C
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* first hearing in first committee of referral
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+ teleconferenced
= bill was previously heard/scheduled
HB 230-PERS BENEFITS FOR POLICE/FIRE DISPATCHERS
Number 1053
MR. PATRICK HARMAN, staff for Representative Pete Kott, explained
the proposed amendment for HB 230. The amendment will calculate
the retirement of dispatchers as peace officers and not in another
category. On page 1, line 1, following "dispatchers," the phrase
"and certain emergency medical personnel" would be inserted. On
page 1, line 7, following "dispatcher," the words "or as an
emergency medical service officer or an emergency medical
technician" would be inserted.
SENATOR LEMAN moved amendment number 1. Without objection, the
motion carried.
SENATOR LEMAN moved to adopt SCSCSHB 230 (1-LS0958\I) as the
working version of the Labor & Commerce committee. Without
objection, the motion carried.
MR. HARMAN stated SCS CSHB 230(L&C) recognizes the stress and burn-
out the dispatchers experience from the job. SCS CSHB 230 (L&C)
allows dispatchers to convert the normal 30 year retirement plan to
a 20 year retirement plan. Because the legislation will only
impact the dispatchers, no fiscal note is required.
CHAIRMAN MACKIE asked if Mr. Harman had received the letter from
David Hull in Ketchikan asking to include Emergency Medical
Technicians (EMT's) in the amendment.
MR. HARMAN stated the purpose of the amendment is not for other
people to use this as a Christmas tree vehicle. It would not harm
dispatchers if EMT's were expanded in the legislation.
CHAIRMAN MACKIE stated support for HB 230 and for expanding it to
cover EMT's.
SENATOR HOFFMAN asked how the change in statute would affect a
person just entering the profession as a dispatcher, and whether
the new people have to pay the difference also.
MR. HARMAN stated the people just starting would pay at the same
rate as a 30 year retirement plan. The 20 year option is only
available at retirement.
SENATOR HOFFMAN asked how these people were going to pay a
difference of $100,000 at the end of 20 years.
MR. HARMAN stated they could consider a mutual fund, annuity plan,
or bank loan.
SENATOR KELLY asked if those people could have the money taken out
of retirement proceeds as they are received, to pay for the lump
sum difference.
CHAIRMAN MACKIE stated including EMT's would take a title
amendment. At this time the committee did not offer that
amendment.
SENATOR LEMAN stated there would be no impact on the PERS system
because there is no impact to the general fund.
MR. HARMAN stated that was correct.
SENATOR LEMAN stated people that leave before the 30 year
retirement still receive a retirement. It might benefit people to
have a separate retirement account available. The State should
research a defining contribution system. It would be an investment
system and at retirement people can draw from investments they have
made.
MR. HARMAN stated there is a more mobile workforce now, and people
generally don't stay in a position for 30 years.
Number 1732
MR. AL TAMAGNI JR., Dispatcher for the Anchorage Fire Department,
stated support for SCS CSHB 230 (L&C). A dispatcher's job is to
direct and coordinate a constant streak of activity, while
remaining seated at a radio console. Dispatchers are a life saving
link between the community and the public safety responders.
Overwhelming stress falls on dispatchers, as well as officers and
firemen.
Dispatchers must serve an additional 10 years past their peers
before being eligible to retire, and surpass their peers in
turnover rate. Critical decision making requires dispatchers to be
in control of their emotions. SCS CSHB 230 (L&C) will shorten the
unrealistic time period required for public safety dispatchers to
serve prior to being eligible for retirement.
MS. TONYA KURTZ, Dispatcher for the Juneau Police Department,
stated the Juneau Police Department has ongoing problems keeping
dispatchers and it is currently understaffed. 22 people have been
hired in the past five years. Only five of the 22 are still
employed as dispatchers. The demands are high and very few people
can meet those demands; a 30 year retirement is unrealistic. Ms.
Kurtz stated support for SCS CSHB 230(L&C), but is concerned about
the financial burden on the dispatcher at the end of 20 years.
SENATOR LEMAN stated he would like to see what the financial burden
will be at the end of 20 years. Maybe an investment portfolio can
be started so the terms aren't unrealistic. Dispatchers never make
the 30 year requirement for retirement, but maybe those people
could ask for a lateral move and go to another position under the
PERS system.
MS. KURTZ stated the lump sum is a concern. Something should be in
place to make the contributions ongoing so it is not such a burden
at the end of the 20 years.
CHAIRMAN MACKIE asked what the requirements were for early
retirement.
MR. BILL CHURCH, Retirement Supervisor for the Division of
Retirement & Benefits, stated normal retirement can be achieved by
age or service. If you were hired before July 1, 1986 the normal
retirement age is 55. If you were hired after July 1, 1986 the
normal retirement age is 60. At any age, someone who is in the all
other system and works 30 years can begin receiving a retirement
benefit.
SENATOR KELLY asked, if a person serves as a peace officer for 20
years and starts at age 20, at what age they start receiving
benefits.
MR. CHURCH replied at age 40 if they started before July 1, 1986.
Those benefits also include free major medical and health coverage.
SENATOR KELLY asked, if SCS CSHB 230(L&C) passes, whether there is
a way to increase deductions for retirement for people already in
the system.
MR. CHURCH answered no. There is no mechanism for a person to have
extra money taken out for retirement. Maybe they could be advised
to set money aside and have it invested.
SENATOR KELLY asked what percentage peace officers pay out to
retirement.
MR. CHURCH replied 7.5 percent v. 6.75 percent for all other
positions.
SENATOR KELLY asked once SCS CSHB 230(L&C) passes, why dispatchers
can't start paying out at 7.5 percent.
MR. CHURCH stated that would still not cover the costs, but it
would lessen the lump sum at the end of 20 years.
CHAIRMAN MACKIE used Ms. Kurtz as an example, and asked if a person
who had been employed for four years started paying at the higher
rate, whether at retirement the lump sum would consist of the
original four years that person did not pay the higher rate.
TAPE 00-10, SIDE B
MR. CHURCH stated no. The system only pays 4.5 percent interest on
money held in the system. Retirement benefits are based on
contributions from the employer and employee, and investment
returns. The retirement benefits people claim are paid out in the
first three years of retirement. Money after that comes from
employer income, and investment income those funds have earned.
SENATOR KELLY asked what will happen if a person retires at 20
years but does not have the money to pay the lump sum.
MR. CHURCH replied SCS CSHB 230(L&C) would allow the employee to
take a lifetime actuarial reduction to those benefits.
SENATOR KELLY asked if that was a gamble to the system.
MR. CHURCH replied yes.
SENATOR KELLY stated the system estimates how long the person will
live, and if they die the following year the system gains that
money.
MR. CHURCH answered yes. The factors are based on interest
assumptions of the fund and mortality factors used in the insurance
industry.
SENATOR HOFFMAN asked if military time counted toward the 20 year
retirement.
MR. CHURCH replied no. The 20 years needs to be in membership
service, 20 years as a dispatcher or peace officer.
SENATOR KELLY asked if the employee is required to front a lump sum
of money at the end of 20 years, whether the employer is required
to do the same.
MR. CHURCH replied no. Mr. Church referred to an example submitted
by the system's actuary.
Number 2191
SENATOR LEMAN asked, after a person has invested 20 years, whether
it is factored into adverse selection with regards to poor health
and other possibilities.
MR. CHURCH replied he didn't recall discussing that issue with the
actuary. Normally an adverse selection would be factored into the
equation.
SENATOR LEMAN asked Mr. Church for statistics on typical employees
that work 20 years and 30 years, and how the retirement would be
calculated.
MR. CHURCH answered the calculations were made on 20 years of
service for an employee with an average salary of $50,000.
SENATOR LEMAN asked if it would change other benefits like medical,
dental, etc.
MR. CHURCH replied no. Other benefits are driven by when the
person is first employed in the retirement system.
Number 2045
MR. PABLO PAIZ, Police Officer with the Anchorage Police
Department, stated he has been employed by the Anchorage Police
Department for 10 years; four years of that time was as a police
dispatcher. The most stressful job he has encountered was
dispatching. Dispatchers monitor the lives of the people on the
phone and the police officers they send out on calls along with
firemen and EMT's. A major reason Mr. Paiz became a police officer
was because he knew he could not put in the 30 year requirement for
retirement. Mr. Paiz stated support for SCS CSHB 230(L&C).
MS. KAREN CHILDERS, Communication Supervisor for the Juneau Police
Department, stated public safety dispatching is a job like no
other. The nature of the job requires technical communications,
multi-tasking, and inter-personal skills. What separates the job
from others requiring the same skills is that a dispatcher must
have the ability to disengage their emotions in order to get the
job done.
MS. CHILDERS gave examples of horrifying 911 calls. On a daily
basis dispatchers deal with the worst of life's realities. The
possibility of a dispatcher dealing with an emergency involving
friends and family is highly probable in Alaska. 20 years of
cumulative stress is long enough, yet 20 years is short enough to
make it attractive as a career choice and rewarding to those who
have already dedicated many years of service. Ms. Childers stated
support for SCS CSHB 230(L&C).
MR. DUANE UDLAND, Chief of the Anchorage Police Department, stated
support for SCS CSHB 230(L&C). He will be encouraging people who
are hired, and are already employed to start saving toward their
retirement.
CHAIRMAN MACKIE asked if he knew of any dispatchers that had made
it to the 20 year mark or 30 year mark.
MR. UDLAND answered some make it to 20 years, not many make it past
that point, and no one has made it to 30 years.
CHAIRMAN MACKIE asked if the people that left their position could
have made the 20 year mark if the law had been in place.
MR. UDLAND replied yes.
SENATOR LEMAN stated people do have options available for
investing, and they could do better than the PERS system through
the investments they make.
MR. UDLAND agreed, and anyone could beat the PERS system if they
invested wisely.
CHAIRMAN MACKIE asked Mr. Udland if he would come up with a formula
for new hires and existing hires for them to start saving for
retirement.
MR. UDLAND stated yes, they would work on that formula.
MR. DEL SMITH, Deputy Commissioner of the Department of Public
Safety, stated support for SCS CSHB 230(L&C). No dispatcher has
ever made it to a 30 year retirement. A light at the end of the
tunnel is extremely important, dispatching is a high-stress job.
Number 1519
CHAIRMAN MACKIE spoke with Mr. David Hull, Ketchikan Fire
Department, and explained the sponsor of SCS CSHB 230(L&C) did not
want to pursue a title change at this time. Chairman Mackie
offered to work with him on another avenue to include EMT's for a
20 year retirement.
SENATOR DONLEY moved SCS CSHB 230(L&C) out of committee with do
pass recommendations. Without objection, the motion carried.
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