05/15/2003 08:39 AM House FIN

SENATE BILL NO. 177                                                                                                           
                                                                                                                                
     An Act  relating to cost-of-living benefits  for retired                                                                   
     members in  the public employees' retirement  system and                                                                   
     the  teachers'  retirement  system  who  are  called  to                                                                   
     active  military duty;  and providing  for an  effective                                                                   
     date.                                                                                                                      
                                                                                                                                
DEBORAH GRUNDMAN, STAFF, SENATOR  BEN STEVENS, stated that an                                                                   
Alaska Cost-of-Living Allowance  (COLA) is payable to benefit                                                                   
recipients  of the  public  employees'  (PERS) and  teachers'                                                                   
retirement  system  (TERS)  who remain  domiciled  in  Alaska                                                                   
after  retirement.   The allowance  amounts to  10% of  their                                                                   
base pay.  A  person receiving a COLA is not  entitled to the                                                                   
allowance if absent from the State  for a period in excess of                                                                   
90 days,  except that a person  may be absent from  State for                                                                   
not more  than six  months if  the absence  is the  result of                                                                   
illness and required by order of a licensed physician.                                                                          
                                                                                                                                
Ms.  Grundman  added  that  upon  return  to  the  State  and                                                                   
notification to the Department  of Administration, the person                                                                   
would  be  entitled to  receive  the  monthly  cost-of-living                                                                   
allowance,   commencing  with   the  first  monthly   benefit                                                                   
payment.  Retired  public employees currently  receiving COLA                                                                   
in  the State  and  who  are called  to  active  duty in  the                                                                   
military would  not be  eligible for  the COLA payment  while                                                                   
serving  under  existing  statute.    SB  177  rectifies  the                                                                   
situation and allows the retired  employees to be eligible to                                                                   
continue receiving their COLA  while on active military duty.                                                                   
She  noted  that  the  legislation  would  affect  about  ten                                                                   
people.                                                                                                                         
                                                                                                                                
Co-Chair Harris asked  why this issue had not  been discussed                                                                   
before.  Ms.  Grundman replied that a situation  had not come                                                                   
up before in which  there is a PERS or TERS  member called up                                                                   
for active duty.                                                                                                                
                                                                                                                                
Representative  Foster   MOVED  to  report  SB   177  out  of                                                                   
Committee  with  individual  recommendations   and  with  the                                                                   
accompanying fiscal  note.  There being NO  OBJECTION, it was                                                                   
so ordered.                                                                                                                     
                                                                                                                                
SB  177  was reported  out  of  Committee  with a  "do  pass"                                                                   
recommendation  and with zero  note #1  by the Department  of                                                                   
Administration.