Legislature(1997 - 1998)
02/11/1998 03:18 PM House L&C
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* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
HB 323 - PERS CREDIT FOR NONCERTIFICATED EMPLOYEES Number 1303 CHAIRMAN ROKEBERG announced the committee would take up HB 323, "An Act relating to the calculation of credited service in the public employees' retirement system for noncertificated employees of school districts, regional educational attendance areas, and state boarding schools; and providing for an effective date." He noted the bill sponsor, Representative Brice, would present the bill to the committee. Number 1321 REPRESENTATIVE TOM BRICE stated he is looking to achieve a certain amount of equity amongst the people who work in our schools. He noted certified employees receive a year of service for the nine months they work during the school year, and he would like to see noncertified staff - the janitors, the receptionists, the office staff - receive that level of retirement benefit as well. Representative Brice stated for most of these people, these are their full-time jobs, and it takes 40 years of work for them to receive a 30-year retirement, and he thinks that is a little overbearing for many of the people who work in the school districts. Representative Brice stated he was not necessarily tied to the current language of HB 323; he is trying to ensure those noncertified employees can receive a 30-year retirement at 30 years. He noted he is also looking to ensure that these employees can vest within the regular length of time, rather than the 25 percent extra they currently must work to receive the same credit. Additionally, Representative Brice stated they wish to ensure actuarial soundness. It is his understanding that the people who represent these employees are more than willing to pay their share to ensure that their retirement system remains actuarially sound and they are not considered a burden to anyone else. Sponsor Statement for HB 323: Alaska has many noncertified employees in our schools who work nine, ten or eleven months out of the year along with their certificated counterparts. These noncertificated employees however are not allowed to receive the full year toward retirement as their counterparts. This bill addresses the inequity in State law and PERS system by placing noncertificated school district employees who work a comparable amount of days in the same category of certificated employees. This bill will allow those noncertificated school district employees to receive the same amount of credit toward retirement as those certificated employees who work the same amount of time and receive a full year of credit toward retirement. Number 1490 CHAIRMAN ROKEBERG noted the presence of someone from the Division of Retirements and Benefits to answer technical questions. Number 1500 REPRESENTATIVE COWDERY asked if this was intended to be retroactive. Number 1508 REPRESENTATIVE BRICE answered in the negative, giving the scenario of a ten-year employee currently receiving nine months of credit per year. He stated, at the effective date, the employee would begin accruing a year of service for the nine months worked, versus the nine months of service previously received. Number 1557 REPRESENTATIVE COWDERY asked what union organization would be most affected by HB 323. Number 1565 REPRESENTATIVE BRICE answered it would be the Education Support Staff Association, a subsection of NEA-Alaska. REPRESENTATIVE COWDERY noted, "In Anchorage, there's, I think, labor ..." REPRESENTATIVE BRICE responded, "It would expand to those ...." Number 1601 REPRESENTATIVE COWDERY clarified the ones he knew of, the janitors and such, were mostly out of the laborers' union, and he wondered if that was the dominant organization which would be affected. Number 1623 REPRESENTATIVE BRICE clarified that the laborers' union would not be the dominant organization affected statewide. He noted in his district it would be the Educational Support Staff Association. Number 1628 CHAIRMAN ROKEBERG asked if Municipality of Anchorage's school district employees would be covered by HB 323 in terms of their involvement in PERS (Public Employees' Retirement System). Number 1641 REPRESENTATIVE RYAN directed a question to Bill Church with the Division of Retirements and Benefits. Representative Ryan said it was his understanding, under the PERS system, that there was a fixed benefit and a fixed contribution by the employee, and the employer's contribution was variable. Number 1675 BILL CHURCH, Retirement Supervisor, Division of Retirement and Benefits, Department of Administration, stated Representative Ryan was correct. Number 1689 REPRESENTATIVE RYAN commented that the employee contribution would have to be calculated here, plus the corresponding employer's contribution, in this case the local school districts, and they would have to make a contribution which would be sizable enough to offset the three months of lost credit. He asked if any figures were available. Number 1716 MR. CHURCH replied that there has been enough time to look at it overall, and to look at the consolidated rate - how it would affect all employers, not just school districts, but municipalities, cities, et cetera. In general, it would increase the consolidated rate 5.58 percent, noting the Division of Retirement and Benefits has outlined this on the second page of the fiscal note. Mr. Church said if they were to look at the bill and say school districts were going to be affected by HB 323, that would increase substantially, and he noted the division has not had enough time to take an in-depth look. Number 1760 REPRESENTATIVE RYAN stated his reason for asking was because, if he was correct, this is all predicated upon actuarial assumptions (indisc.) soundness of the fund. He noted those change from time to time, and he recalled the first time he got into this, in 1992, when there was supposed to be a steady increase in state employment for 20 years and they were going to get 14.5 percent on their money. He stated there has a been a (indisc.) check since then and the assumptions have changed, and asked what they were operating on nowadays, as far as assumptions for the PERS fund. Number 1805 GUY BELL, Director, Division of Retirement and Benefits, Department of Administration, stated he believed the investment return assumption is 8.5 percent per year, noting that is the primary assumption which has been somewhat variable over time. He said the actuaries look at three different employee growth scenarios in the entire system: 1, 2 and 3 percent and they look at the consolidated rate as based on some extrapolations from those (indisc.) that the retirement board (indisc.). Number 1841 REPRESENTATIVE RYAN mentioned the soundness of the fund, noting it should be funded to 120 percent, or a factor over 100 percent, to insure that the employees who were receiving benefits did not draw the fund down low, and he asked if Mr. Bell could explain that point. Number 1871 MR. BELL said he would try to answer Representative Ryan's question and Mr. Church could correct him if necessary. He stated the way the actuaries try to develop their projections, they try to come up with an approximately 98 percent funding ratio. He said that is the ideal; over time there will be changes, and because past liability is paid off over a period of time they are never actually theoretically going to reach 100 percent. Mr. Bell stated they are basically at that point right now in the PERS system, and slightly above, by the actuaries' last calculation. Number 1912 CHAIRMAN ROKEBERG invited Mr. Bell to give his testimony, with questions following. Number 1925 MR. BELL stated much of his testimony had already been covered in the previous question and answer section. He stated, as HB 323 is currently written, the cost of the legislation would basically affect all employers in the PERS system. The employee rate is fixed in statute at 6.75 percent, and the variable rate, the adjustment to the rate, is the rate paid by the employer, whether it is the state of Alaska, a municipality, or a school district. Mr. Bell commented their actuaries have indicated that the consolidated rate, looking prospectively at the cost change associated with this legislation to employers would be .58 percent. He noted that is a small percentage but it translates to about $7.5 million per year for this group of this employees. He stated they have submitted a fiscal note which briefly documents how they reached that number. There has been some discussion of alternate ways to approach this, but he said, as the bill is currently written, it would affect every employer, not just school districts. Number 2045 REPRESENTATIVE HUDSON commented Mr. Bell had said, as currently written, this $7 million dollars would essentially fall on political subdivisions and the state of Alaska as an employer, or, he questioned, would it all be political subdivisions? MR. BELL replied in the affirmative. Number 2060 REPRESENTATIVE HUDSON stated, then, in order to attribute a portion of these costs to employees as a new benefit, noting normally benefit improvements are combination of both the employees' contributions and the employer's contribution, they would have to go back into the statutes and modify the fixed rate of employee contributions to accommodate that. Number 2098 MR. BELL stated that was correct and he would go one additional step to indicate the fixed rate for a certain group of employees, because only a certain group of employees would be affected. Number 2126 REPRESENTATIVE COWDERY asked if HB 323 was passed with its effective date of July 1998 where the necessary funding would come from. He asked if it was in the Governor's proposed budget. Number 2147 MR. BELL responded the money would need to be appropriated. Number 2159 CHAIRMAN ROKEBERG commented, "The new legislation line item ...." Number 2174 REPRESENTATIVE HUDSON asked if the Administration has taken a position on HB 323. Number 2185 MR. BELL responded that the Administration has not. Number 2190 REPRESENTATIVE BRICE addressed Representative Cowdery's point, noting, first of all, they are in the process of looking at language to ensure they are not talking about the whole PERS system, making sure that those who are going to receive the benefit bear the cost. He commented that his original intent was that any increase in cost to the PERS system was going to be paid by those participating in the PERS system. Number 2257 CHAIRMAN ROKEBERG commented, "Employees rather than employers (indisc.) ...." Number 2259 REPRESENTATIVE BRICE responded that maybe it would even be some mixture. He noted no state employees would be participating, and said, regarding the $7.5 million fiscal note, "I assume what we're talking about with that is that it applies to all state employees ... because ... what we're talking about is - is ... expanding throughout the system, or maybe I'm - I misunderstood what you were saying." Number 2322 MR. BELL referred to page 2 of the fiscal note, stating they had broken the fiscal note down between what the state costs would be, the state costs including the University of Alaska, and the political subdivision costs. He said it was strictly pro rata, based on the salary payments of, as written, the distribution between the state, university and political subdivisions, and he noted the salary information came straight out of their payroll information system. CHAIRMAN ROKEBERG asked if there were further questions, noting there were a number of people who wished to testify. Number 2377 REPRESENTATIVE COWDERY added that this would impact all less than 12-month per year employees. MR. CHURCH state he believed the term would be seasonal. Number 2395 MR. BELL added, "Only for school districts." REPRESENTATIVE COWDERY replied, "Yeah, I understand, I know, it wouldn't (indisc.) the temporary staff or anything like that." Number 2411 REPRESENTATIVE RYAN noted, on the front page of the fiscal note, $215,000 was included to hire a contractor to update the system. He asked for some insights, noting it seemed like adding an extra line item or column, and he could not understand why it would take $215,000 to update a database. TAPE 98-13, SIDE A Number 0009 REPRESENTATIVE SANDERS questioned whether HB 323 would have to go to the House Finance Standing Committee, commenting it had a fiscal note. Number 0023 CHAIRMAN ROKEBERG confirmed that if HB 323 moved forward it would, without question, be going to Finance. Number 0052 MR. CHURCH stated, in reply to Representative Ryan's previous question, that the division currently has two automated systems: an existing computer system, and it is in the process of developing a combined retirement system. He said both of these systems would have to be updated because of when the new system is anticipated to be on line. Mr. Church stated they asked their programming staff to come up with an estimate of the time needed to create the mechanisms necessary to calculate and take care of the service credit, mentioning granting credit, calculating future service, and noting they have a projection system (indisc.--coughing) need to be changed (indisc.--coughing) many different components to their computer systems that would have to be upgraded, then multiplied by two because of the double systems. Number 0140 REPRESENTATIVE SANDERS asked if these employees would receive credit for 1.25 years if they worked longer than 9 months or took another job for the other 3 months. Number 0180 MR. CHURCH answered it was only possible to accrue one year of service in any given year, whether school year or calendar year. Number 0197 REPRESENTATIVE BRICE noted, "We sort of alluded to it to a certain extent earlier about, or in earlier discussions, about moving these employees out ... out of the PERS system and into the TRS (Teachers' Retirement System) system. Say you were to put these noncertified employees within the TRS system, what kind of impact is that gonna have -- ... without any discrepancy amongst retirement benefits? Number 0261 MR. CHURCH answered that the potential of creating a school employee retirement system had been discussed, noting some states have their systems structured that way. Whether an individual is certificated or noncertificated, they are under one retirement system, and benefits are structured under that. He said in order to be able to answer the financial questions - where that would go, what benefits would be structured under it - the division would have to have some guidelines on anticipated benefit structure, if they anticipated changing the benefit formula. Mr. Church stated currently in TRS, the division basically has a set rate of 12 percent across the board to all employers, and he noted that would probably change, given the nature of what would be going on. He asked if they were going to be interested in affording the same types of benefits to this new group under this retirement program. Mr. Church said he thought there were a lot of questions to be answered before it would be possible to ask the division's actuaries for estimates of costs, contribution rates, and impacts on employees and employers. Number 0388 REPRESENTATIVE BRICE responded that they would contact Mr. Church later and begin working on it. Number 0395 CHAIRMAN ROKEBERG stated he would like to have all the testimony at this meeting, and he requested witnesses testifying via teleconference to limit their testimony to three minutes. Number 0444 THEODORE SIMMONS, President, Lower Kuskokwim Educational Support Personnel Association, NEA-Alaska, testified via teleconference from Bethel. He stated HB 323 would affect the association's approximately over 350 permanent seasonal employees, who work less than 12 months but over 180 days. He said the majority of these employees are not covered under the employer's health benefits, but, in fairness, the association is looking to bring it into alignment with the administrators, the teachers, and the board members who all currently receive a year's credit in the PERS retirement system for the school year's service. Mr. Simmons encouraged the committee's support of HB 323. Number 0557 DAVID GIBBS, employee, Delta/Greely School District, Rural Education Attendance Area (REAA) 15, testified next via teleconference from Delta Junction. He commented he was "custodian/courier-type person" going between the three schools each day. Mr. Gibbs noted he has been working for the school district since 1981. He said they didn't get into the PERS retirement system until 1989, and had to fight for that. Mr. Gibbs said vesting takes about five years, but for them it takes much longer because they only receive nine months credit. He noted that, for the teachers and other employees of the state, the nine months they work counts for a whole year. He asked the committee to please consider this for the employees' retirement, commenting that sometimes they feel they are second-rate because they don't receive the same benefits teachers receive, although they support the teachers, the schools and the administration. He said, "Without us, they wouldn't be able to do all of their jobs. But we do support them, that's why they call us support personnel, and we support every facet of the school." Mr. Gibbs stated they are unemployed and received no pay in the summer, and are ineligible for unemployment because they are considered still employed, but they don't make the same money as teachers who are on a regular salary. Mr. Gibbs stated they are paid hourly and they work the same number of days teachers do, plus a few extra. He asked the committee to move HB 323, and thanked Representative Brice for introducing it. Number 0736 JACKI NELSON-LIZARDI, President, Delta/Greely Educational Support Personnel Association, NEA-Alaska, testified next via teleconference from Delta Junction. She read from a prepared statement: In asking for your support of HB 323, noncertificated permanent school employees are seeking a move toward equity with other education, state, and seasonal employees. You, as legislators, are afforded this benefit for a 121 day work year, as are your legislative aides and other legislative employees. City and borough elected officials receive a full year's credit in PERS unless otherwise compensated, when, by their choice, they take the option to waive out of PERS. School board members who meet an average of two to three times a month receive a full year's retirement under PERS. We work approximately 180 days plus and do not receive a full year's credit in PERS. Other seasonal employees across the state, such as those employed by the highway department, fish and game, forestry, do not receive a full year's credit under PERS, but they are otherwise compensated by being eligible for unemployment benefits when they are not working. We are not even allowed to collect unemployment. Even the most aggressive job seekers amongst us cannot find employers who pay more than minimum wage to hire us, no matter how qualified, for a two to three month period in the summer. Number 0820 Privately contracted school employees, such as bus drivers, work less hour per day, as a rule, but the exact same work year, and though not in PERS, they too are eligible for unemployment compensation, while we are not. Prior to about 1992, many more noncertificated school employees were 12-month employees, and were thereby eligible for a year-for-year's credit in PERS. With districts receiving less and less funding for education year after year, they have sought to recoup financially by slashing our hours, benefits and work years, et cetera. I began 19 years ago as a 9-month school employee and my work year has been methodically eroded to a bare 8 months for my efforts. As education continues to be inadequately funded, we see more and more districts with your support looking to the RIP to alleviated their financial stress by having more and more employees of longevity, certificated and noncertificated, retiring. These are usually the folks at the top of the salary schedule, so the savings can be tremendous. What some people don't realize is that, unlike certificated employees, it can cost the districts more to pay our three years then they save by offering us the RIP, because they have to pay PERS for a full 12-month year for each of the three years, whether we work 12 months or not, and it's usually not. Number 0907 Noncertificated employees have been penalized long enough. When there are budget crunches in school districts, we are selected as the first to be hit. We have a history of being discriminated against in the areas of benefits, unemployment compensation, job security, contracting out, the right to bargain, and this, retirement credit in PERS. We are not asking for charity, but simply a benefit afforded other education, state and seasonal employees. After working in the same school job for 19 years, I currently only have just over 7 and a 1/2 years retirement credit in PERS. I had to wait until I was permitted to bargain in 1989, before I even got into PERS. Noncertificated school employees with 20 to 30 years in their jobs can't afford to retire unless they brought PERS credit with them from a previous employer. I am almost 50 years old, and after 19 years have only 7 plus years of retirement credit. You do the math. I figure that I may not even live long enough to see retirement. I am a professional, as are my co-workers and members. We only ask that you treat us as professionals with equal rights under the law. Please don't continue this inequity. Let this legislature be known as a body of fairness and foresight, not one that chooses to continue the inequities of the past. Please do pass HB 323. Thank you for your time. Number 0994 CHAIRMAN ROKEBERG thanked Ms. Nelson-Lizardi for her testimony and noted that legislative staff members do not accrue a full year's credit for an 121-day session, they only receive credit for the period worked. Number 1015 JAN WRIGLEY testified next via teleconference from Delta Junction, noting she was a teacher's aide for a school district there. Ms. Wrigley stated, "I am asking for all of your support of HB 323. It is very frustrating to me to see others receiving a full year's credit in PERS and they are only seasonal workers. Teachers receive a full year in TRS, ... but do not work a full year. Why am I receiving less? I'm a teacher's aide and have worked for 13 years in the same position in our school district. I am just now vested in PERS. I began working here when I was 24 years old, I am now 38 and have only 5 years into a retirement system. That is not right. I am not even eligible for unemployment, and it is difficult, almost impossible, to find decent employment for the 2 1/2 summer months that school is out. I put in 180 days working per year, and sometimes more. I feel that it is only fair that I receive a full year, I'm only asking for the same, no more no less, than others. Please pass HB 323 out of committee. Thank you for your time." Number 1090 VIRGINIA BUCHER testified next via teleconference from Homer. She said she thought, after listening to the testimony from Delta Junction, that it had pretty much all been said. She noted the previous year she had been laid off in May because of budget cuts and was able to apply for unemployment. She said her unemployment checks equaled what she would have made from a summer job down there taken away from one of the high school students, noting that was about the best she could have done. Ms. Bucher also stated that retirement is usually based on the top three years. If an employee works longer than 25 years - if they have to put in 28 years instead of 25 - their salaries are higher, and their retirement will be based on a higher salary than if they had retired at 25 years. Ms. Bucher reiterated her support for the testimony from Delta Junction. Number 1154 CYNTHIA FARRENS testified next via teleconference from Homer. Ms. Farrens stated, "I take great pleasure in being a public servant. I've been a public employee in the state of Alaska since 1982. I've worked for the court system, the Department of Administration, and I consider myself a professional working within the Kenai Peninsula Borough School District. I really feel it is unfair and discriminatory not to consider the support staff under the same standard as the teaching staff within a school district. We work the same hours, sometimes longer; our hours extend before the school starts and go beyond school gets out, but we don't get the benefits that we should be entitled to. I would happily pay my share of retirement benefits to PERS to get those years' credits that I'm eligible for, and I do hope that you support this bill and pass it out of committee, so it can be heard by the House." Number 1222 DIANA PISTRO testified next via teleconference from Kodiak. She stated she works at the middle school and was representing the classified employees of Kodiak Island and villages. She stated she agreed with Ms. Nelson-Lizardi from Delta; they work nine months, only receive credit for that, and are not allowed to collect unemployment. Ms. Pistro said she understood assembly board members serving two to four days out of a month receive a full year in their PERS retirement, as do borough board members. Ms. Pistro said, "I also understand that [if] this bill goes through that there's really no cost increase, because they'll just turn around and do it the same way that they do it with the teachers and administration." Ms. Pistro commented she was definitely in favor of passing this bill and thanked Representative Brice for introducing it. Number 1276 SANDY PEVAN, President, Classified Employees' Association, Matanuska-Susitna Borough School District, NEA-Alaska, testified next via teleconference from the Matanuska-Susitna (Mat-Su) Legislative Information Office. She stated she was representing 550 noncertified educational employees, and noted statewide they were basically in the same vein. Ms. Pevan stated that classified employees feel they have been inequitably treated and would like to have some changes made. In example, Ms. Pevan noted she has worked in the Mat-Su Borough School District for 19 years and 14 years paid-up in her retirement system. She said she is 52 years old and will have to work until she is 65 to retire, noting her health is good so that is not currently a big issue. However, Ms. Pevan said the reality is that classified employees work side by side with teachers on a daily basis. She stated, "We do the same job, working with teachers, they're receiving a year's credit for the same job. There is a large inequity within this retirement system. We are willing to pay a fair share, we want to keep the system sound, but we would like this issue addressed, and passed out of your committee, with your support, into finance committee. Thank you." Number 1360 CHAIRMAN ROKEBERG, hearing no further witnesses via teleconference, stated the committee would return to testimony from the committee chambers in Juneau. He apologized for the departure of his colleagues on the committee, noting the hour and scheduling conflicts. Number 1390 SHARON CARTNER, President, Education Support Staff Association, NEA-Alaska, representing over 600 members in Fairbanks, came forward to testify. She stated, "I thank you and the members of the committee, even though they're not here." Ms. Cartner thanked Representative Brice being patient and introducing this bill. She it has been a bill they have tried to push through, she thinks, in the eight years. She noted it is very close to her because she is one the nine-month employees for the district. Ms. Cartner stated probably half of the 600 members of the Education Support Staff Association in Fairbanks she represents are at least 9 or 10-month employees, and she said it gets very "disserting" that they put in as much time as everyone else does and yet cannot get the retirement credit. She stated she has been in the district for 17 years, and probably has less than 14 years in retirement. She noted to reach the 20 years, she would have to put in a lot more time, stating, "I really don't plan on working until I'm over 60 so that probably won't happen, unless there's a change in this law." Ms. Cartner noted that the only people in her district who are currently officially laid off are the teachers' aides (TAs), and they are not guaranteed their jobs back in the fall. She said the rest of the employees are told they are educational employees, therefore guaranteed a job, but yet they are not being paid in the summer and cannot draw unemployment. She said she really has a problem with that. Number 1472 MS. CARTNER stated, "I would like to have people explain to me, why the inequity, and come up with a good solution, because our people sit there and - and they see that they're working the same amount of hours side-by-side with certified staff, and yet they don't get the same benefits. And I really think that the state needs to look at this, I think that the members are willing to pay their part to support this, ... right now we don't have that option, we cannot pay for the months that we're not working. I think a lot of the members would be willing to pay for that, or to increase the amount of money that goes toward the PERS program. Also, I think the individual unions could probably bargain [with] the district to pick up part of that. That's all (indisc.) negotiations, I don't see why that can't be split, it's split right now so I can't see that we couldn't work on something like that so that we could bring this up to an equitable situation." Number 1512 MS. CARTNER stated, "The members of our union are very conscientious, hardworking people. They work for the school district because they love children and that's where they want to be. They usually give a lot more time than the seven and a half, or ... not anyone in our district works eight hours, it's usually seven, anything over five hours is full-time, and they work seven, seven and a half hours. They are there a lot longer than that, they do not get paid for it, we are not allowed 'comp time' and we do not get overtime. So if a child is left at the school, usually one of the staff has to stay and take care of this child until the parent shows up. That's a given. We were told last year that because they are working certain hours that, by law, they can be compensated for the extra time that they worked, but, up until this point they haven't been, and this has always been a big issue. So what I'm asking is that we adjust this situation, and that the state look at it very hard, and if they want to keep the good employees that they have and give them something to work toward, that this what they're going to need to do, because otherwise they're not going to keep the employees -- (indisc.) be looking for other jobs, and a lot of 'em are just really nice people and hard workers, and I thank you for your time." Number 1590 KAREN MAHURIN, President, Kenai Peninsula Educational Support Association, NEA-Alaska, came forward to testify. She thanked the Chairman and Representative Brice and said she was disappointed the rest of the committee was not there, noting she felt her testimony would answer many of the questions she heard Representative Ryan, Representative Sanders and Representative Cowdery bring up earlier. She stated, "I also feel that this bill is so important to us and to our members that I have spent a lot of money, as has Mrs. Cartner, to fly down here to testify in person. So I really am disappointed. And as Mrs. Cartner said, when we have children who aren't picked up at school, it doesn't matter what time it is. I have been there as late as midnight before ... I called the police to come for children, so we do go above and beyond, and - and I'm a little concerned, and I appreciate you letting me voice that." Number 1625 CHAIRMAN ROKEBERG assured Ms. Mahurin her testimony would be part of the official record, and he noted she was actually speaking to all 60 members of the legislature. Number 1640 MS. MAHURIN continued, "I am an elementary school secretary and I am president of the Kenai Peninsula Educational Support Association (KPESA), but I speak to you not only on the behalf of the members of KPESA but also on behalf of all the support employees in Alaska. It doesn't matter if we are NEA-Alaska, AFT (American Federation of Teachers), TOTEM (TOTEM Association of Educational Support Personnel), AFSCME (American Federation of State, County and Municipal Employees), any of us who are school support employees that are covered by PERS are the ones that this bill would be affected by. I realize that many times when someone testifies before you, they begin with emotional, heart-wrenching reasons of why you should vote for this bill. I am very hopeful that if I can tell you the facts as I see them you will weigh this carefully and make the right decision." Number 1669 MS. MAHURIN stated, "When I began work in the Kenai Peninsula Borough School District in 1981, I received unemployment benefits during the summer months I did not work, as the state considered all school support employees as seasonal workers, and thus eligible for unemployment. When President Reagan eliminated unemployment for support employees in 1984, the state of Alaska continued to pick up the unemployment bill under SIBS (AS 23.20.354, State Interim Benefits) and we received those benefits until '86-'87. In 1987, I believe, the state of Alaska made the determination that school support employees were indeed full-time, year-round permanent employees and thus stopped our eligibility for unemployment benefit. However, we are still considered part-time workers under PERS." Number 1699 MS. MAHURIN continued, "My point, sir: If the state of Alaska considers us as year-round employees, why then don't they give us a full year's credit of retirement for the school year worked. As others have said, I have worked 17 years and I have 14.5 years of retirement credit, as I am a 10-month employee. I understand there are seasonal workers who work for the state, they do receive partial year's retirement credit, but they also receive unemployment benefits. I also understand that there are less than full-time people who do receive a full year's retirement credit. These people are elected officials such as school board members, city council members, borough assembly members. I truly do not understand the logic of allowing them a full year's credit in the same retirement system I am in when they only attend two or three meetings a month and I work 160 hours a month. Under the new three-tier retirement, where employees need to qualify a formula of 85, I can't help but think that of course the state would save money, our school employees who must meet the qualifications of age plus service, given that they only give partial years service credit, will die ... on the job of old age and PERS will be able to save that money. Even though we are part of PERS, school support employees are a different type of employee group than other state workers and must be treated accordingly." Number 1757 MS. MAHURIN explained, "Here is what is happening in other states: Pennsylvania, school employees receive a full year credit for working the 9 month[s], actually 180 days; North Carolina, education support employees who work for thirty hours per week or more pay into the retirement system just like full-time teachers and administrators, 10 months equals 1 year of service. In the state of Washington, an ESP (Education Support Personnel) employee who has worked a minimum of 70 hours a month for 9 months will receive 1 full year of retirement credit. In Nevada, where we receive a - a year of credit on retirement, in other words, 9 months, 4 hours, counts as a year in PERS. Michigan, 180 days at more than 4 hours equals 1 year. New Jersey, 10 month employees are credited with 1 year of service, that's both teachers and ESP, in the retirement plan. In Vermont, the standard for school districts is employees of a school district, who work not less than 30 hours a week for the school year, and for not less than a total of 1,040 hours per year qualify for a full year's retirement credit. In Florida, 10 months equals 1 year. In Ohio, we receive a year's credit after working a 120 days." Number 1810 "In all honesty, and I know that I have somewhat chastised this 'commission,' but last spring this legislature honored me with a resolution after I was named the National Education Association Education Support Person of the Year. And I was very honored to receive your resolution, but more importantly, Mr. Chair, I - I valued your recognition of the work that I do every day in my school. I am not alone, I truly feel blessed to work with such caring, dedicated employees, employees who put kids and parents first. I urge you to look at the facts and to make this situation right. The law as it reads now penalizes quality employees for caring enough about kids to work in schools. Several different ideas have been tossed around here today. We are amenable to a - a amendment, if that is necessary. We would encourage you to look under the TRS, we ask us to look at us as a subgroup under PERS, and there again, this has been stated all day, we are not asking other PERS employees to pick up ... our costs. We seek only fairness in the law, and that means paying our fair share. Thank you for the opportunity to testify." Number 1862 CHAIRMAN ROKEBERG asked Ms. Mahurin is she would provide a copy of her statement to the committee. Number 1880 JOHN CYR, President, NEA-Alaska, came forward to testify. He noted the committee was in possession of NEA Alaska's position paper, and commenting on the lateness of the hour, said he would not go into it in detail. Mr. Cyr commented that the committee has heard the rational, logical arguments about why this should happen, and he hopes that it will take testimony at a later time if they have amendments, noting he would like to spend time with the committee at that point. Mr. Cyr stated, "(Indisc.) have school employees out there are earning 120 bucks week gross, 130, 140 bucks a week and trying to raise families, and what we're doing is making it almost impossible for them to retire on the amount of time that they work. I think that this system that we have now is punishing the people who can least afford to save for their future, in the worst way. ... I have to believe that this committee and this legislature can find a better way to deal with employees who work with kids, than we have now - whether we use this bill as a vehicle or whether we rewrite it in the future - there's gotta be a better way to do this. I refuse to believe that people of goodwill can't come up with something to help the people who help kids. With that, thank you." NEA Alaska's position paper read: NEA-Alaska supports House Bill 323. NEA-Alaska seeks legislation to cause equitable treatment between teachers and school employees. After twenty years of service in an Alaska school district a teacher receives twenty years of credit for purposes of retirement. In contrast a school secretary, a janitor, or school bus driver working the same 20 years receives on 15 years of service credit. For a support employee working a nine month school term it takes 40 years to get 30 years of retirement service credit. It takes the same employee 6.8 years to vest in the retirement system instead of five. Legislative changes last year have made it harder for school support staff members to vest in order to qualify for health insurance at retirement. A newly employed school support employee working on a nine month contract must work 13.3 years instead of the 10 year requirement. It's not difficult to understand why retirement incentives have not been made available to school support employees. For a school district to RIP a nine month employee, the district must pay a twelve month retirement credit and the savings that would accrue are lost in the purchasing of the extra year. To provide a three year incentive, a school district would have to purchase four work years. Meanwhile a support employee has limited opportunities to seek summer employment in many communities in Alaska. In particular jobs that allow the employee to add to their PERS time during the summer months are non-existent. We seek a degree of equity. We realize the importance of the work provided by support staff who work shoulder to shoulder with teachers and administrators. The pressures associated with the job are similar for support staff as they are for teachers. Increasing student enrollment causes increased worked demands on support staff. They work to do more with less each year. The stress of work is as prevalent with them as with teachers. In 1997 Alaska schools hired the highest number of new teachers ever. We do not have statistics on support staff turn-over. Support staff generally represents a more stable workforce within schools and communities. But if teacher turn-over statistics are any indicator of possible support turn-over, we face a developing hiring crisis. Alaska must initiate efforts now to attract and retain teachers and support staff so that we can maintain excellent schools for children. HB 323 is the right step in establishing a degree of equity with other employees and elected officials of school districts. School board members who participate in PERS receive a year's credit for attendance and work related to their duties as members of the board. It is only fair to provide for school support employees who work more hours for the school. School employees have heard others argue that they are treated no differently than seasonal workers. School support employees are treated different in ways other than retirement and those listed above. For example, seasonal workers are entitled to unemployment benefits during non-work time. School support staff are specifically excluded from unemployment benefits during non-work time. In additions school support employees have seen benefits and hours reduced. In the public sector, they have become among the lowest paid. They too are required to make ends meet. The retirement system that school employees currently have punishes those who can least afford to save for their future. We urge the Legislature to pass House Bill 323. Number 1940 CHAIRMAN ROKEBERG asked Representative Brice what his intentions were. Number 1954 REPRESENTATIVE BRICE noted the absence of a quorum, and stated he would like to take approximately a week to work on the bill, possibly bringing it back before the committee if the calendar permitted. Number 1963 CHAIRMAN ROKEBERG commented on the very large fiscal note, "an unfunded mandate, if you will, from the legislature, and consider that." Number 1970 REPRESENTATIVE BRICE stated that was exactly what they wanted to work on, commenting he had received the fiscal note approximately three hours previously. Number 1976 CHAIRMAN ROKEBERG indicated HB 323 would be held over.
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