Legislature(2001 - 2002)
05/01/2001 09:55 AM House RLS
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* first hearing in first committee of referral
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+ teleconferenced
= bill was previously heard/scheduled
HB 198-PUB OFFICERS RETIREM'T COLA/COMPENSATION CHAIR KOTT announced that the next order of business would be HOUSE BILL NO. 198, "An Act relating to a post-retirement pension adjustment and cost-of-living allowance for persons receiving benefits under the Elected Public Officers Retirement System; and increasing the compensation of the governor." 07.5 REPRESENTATIVE PORTER moved to adopt CSHB 198 labeled 22- LS0723\S, Cramer, 4/30/01, as the working document before the committee. There being no objection, version S was before the committee. 07.8 REPRESENTATIVE BILL HUDSON, Alaska State Legislature, testified as the sponsor of HB 198. Representative Hudson explained that the revised bill will make whole a small group of former public officers who have now retired or who are the surviving spouses of people who are a part of the Elected Public Officers Retirement System (EPORS). The EPORS legislation came about in 1976 and covered the governor, the lieutenant governor, and all of the legislators at that time. That legislation increased the salary of those folks, but a public referendum resulted in the repeal of the legislation, which essentially rolled the salaries back to their level prior to the legislation. There is a constitutional bar against lowering a benefit and thus those were the only folks able to retire under that program. Therefore, this bill attempts to pick up only those people who have received no cost of living increases since their retirement, which would include the governor and lieutenant governor at the time, and members of the legislature who went on to become the governor or lieutenant governor. REPRESENTATIVE HUDSON said he believes that only four people would be effected by this legislation. These four people have not received a salary increase in the last 15 years [and have been retired for at least 15 years]. Representative Hudson suggested that [the retirement threshold] be changed to ten years, which would include an additional spouse. He noted that he is not permitted to use the names of these people because retirement information is personal. However, he did inform the committee that the four include a governor, a lieutenant governor, a spouse of a lieutenant governor, and one more individual if [the retirement threshold] is changed to ten years. Representative Hudson pointed out that everyone else in that category has received pay emollients or benefits or cost of living increases. 10.5 REPRESENTATIVE HUDSON said, "We do some wrong things with our governor and lieutenant governor salaries in this state." The salaries of the governor and lieutenant governor are simply dealt with in the statute. He explained that other [state employees] who have retired with the post retirement pension adjustment (PRPA) that automatically increases the TERS and PERS retirees [retirement pay] by 50 percent of the annual CPI adjustment if the retiree is under the age of 65 or by 75 percent of the annual CPI adjustment if the retiree is over the age of 65. The people addressed in the bill have never received any increase in their retirement pay. After being brought to his attention, Representative Hudson felt that these people should be treated as everyone else. 12.0 REPRESENTATIVE HUDSON turned to Chair Kott's suggestion of adding a study to the legislation. Representative Hudson pointed out that there is a February 21, 1989, study, which was fairly comprehensive. This 1989 study made the following salary recommendations. For the Speaker of the House [the study] suggested a salary of $40,500 and for the legislators it suggested a salary of $40,000. The [study] suggested that the governor's salary be tied to a Range 30A, which would amount to about $100,000 in 1989. Representative Hudson pointed out that the current governor is making the same as the 1970s governor who this legislation would seek to give a cost of living increase. The governor and lieutenant governor's salaries have not been increased in all these years. Originally, HB 198 included language that would have elevated the governor's salary; however, at the request of Governor Knowles, that was taken out of the bill to be done in separate legislation. Representative Hudson offered to make copies of the 1989 study for the commission proposed in the current bill. CHAIR KOTT remarked that the 1989 study would make the job of the commission easier than what was initially anticipated. 13.8 REPRESENTATIVE BERKOWITZ turned to the new portion included in the CS. He asked if any thought had been given to using the Base Realignment and Closure (BRAC) [approach]. He explained, "In essence the decision doesn't come back to the legislative body." He noted the difficulty in the legislature voting to cut its salaries. REPRESENTATIVE HUDSON said that he didn't believe that there is anything in the legislation that would stimulate anything beyond the cost of living increase for the few EPORS members and the study. He reiterated the presence of the 1989 study. 15.0 REPRESENTATIVE PORTER related his belief that the final decision [regarding salaries] should rest with the legislative body that does appropriations. He didn't believe that such [a decision] could be delegated. CHAIR KOTT noted his agreement with Representative Porter. 15.7 REPRESENTATIVE PORTER moved to report CSHB 198 [22-LS0723\S, Cramer, 4/30/01] out of committee with individual recommendations and the accompanying fiscal notes. There being no objection, CSHB 198(RLS) was reported from the House Rules Standing Committee.
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