Legislature(2001 - 2002)
03/07/2002 08:05 AM House STA
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* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
HB 248-PERS BENEFITS FOR JUV INSTIT EMPLOYEES Number 0409 CHAIR COGHILL announced the final order of business, HOUSE BILL NO. 248, "An Act relating to retirement contributions and benefits under the public employees' retirement system of certain juvenile detention employees and juvenile correctional institution employees." CHAIR COGHILL referred to an actuarial overview presented by Guy Bell of the Department of Administration [on March 5, 2002] with regard to the idea of "the 20-year and out" [retirement] and the method by which the department figures the cost for that. He mentioned contributions by members of the juvenile detention system and the issue that "there could be some absorption within the department," which he said was a policy call to be made in the House Finance Committee. CHAIR COGHILL told the committee he'd allowed HB 248 to come forward because it continues a ten-year debate on the equity between juvenile corrections officers and adult corrections officers. He said, in his view, the "juvenile people" have a bigger issue than "many of the others who have "20-year and out." He mentioned a significant change in the way the state does business. Chair Coghill said he isn't a big fan of the "20-year and out," but has been persuaded this is a worthy discussion. He indicated he was seeking recommendations from members. Number 0552 CHAIR COGHILL mentioned the following legislation: HB 170, regarding peace officer status for Alaska Department of Fish & Game employees; HB 202, regarding park rangers' getting "that same status; HB 445, regarding [Division of] Fish & Wildlife enforcement officers, which is "slightly different"; and [HB 481], regarding the forest technicians who are "asking for the same thing." Chair Coghill said he was willing to hear [HB 248] because of his belief that the juvenile [corrections] employees have the most compelling case. Conversely, he wasn't willing to hear the aforementioned bills because Alaska's present economic situation doesn't allow that. CHAIR COGHILL brought attention to work retention. He said the juvenile detention employees have been able to persuade him that they are losing officers to the corrections officers [system] because of the pay equity issue and the retirement issue. He noted that he has held [HB 248] for a long time in order to figure out the best way to proceed. He explained that his purpose in having the actuarial described was to show the committee "the methodology," but he acknowledged that he didn't know if it had helped with the policy question. Number 0720 REPRESENTATIVE JAMES told members that her evaluation of the present statewide employment situation is grave. She mentioned that some things being done in state agencies are constitutionally mandated, and therefore must be paid for. However, she said she isn't convinced that making the "20-year and out" available will solve the problems of retention and recruitment of employees. She said she suspected that in the next few years a different payment structure would have to be formulated to retain state employees who might leave for better jobs outside of the state [system]. REPRESENTATIVE JAMES recounted her first experience of working for the State of Oregon, in 1956: after a few months, she'd decided she didn't want to be a government employee; however, the benefits then were job security and the medical and retirement benefits, and she said people would take less salary in order to have those benefits. Now times have changed: the federal government has pulled ahead in its benefits, and the state has problems competing. Furthermore, she said, "We can't do these constitutionally mandated jobs if we don't have anybody to do it." Number 0919 REPRESENTATIVE JAMES suggested perhaps wages would also need to be increased, for example. She opined that the 20-year retirement option is "the cheapest thing we can do," explaining that [employees] would have to buy in and put money of their own into it; therefore, if this would satisfy [those employees], she said she thinks "this is the right step to go." CHAIR COGHILL noted that it would cost approximately $7.2 million "over this whole spread of employees." In response to Representative James, he said the fiscal note isn't for one year. REPRESENTATIVE JAMES added that if this wasn't enough to retain [the employees in question], then another problem would exist that would cost [the state] "a lot more." Number 1000 REPRESENTATIVE FATE asked if the 20-year [retirement option] would encourage people to stay [in the juvenile corrections system] because, to his belief, those employees could still transfer to the other system. He concurred with [Representative James's] comments regarding the basic wage structure, which he said is another area of discussion. REPRESENTATIVE CRAWFORD agreed with Representative James as well. Number 1096 CHAIR COGHILL conveyed concern that allowing HB 248 to come before the committee would allow "the compelling case of the others [to] be done outside of the context of the whole workforce issue." He said that was the entire reason for his reluctance in bringing [HB 248] forward. REPRESENTATIVE JAMES agreed with Chair Coghill. Number 1156 CHAIR COGHILL remarked that this is like sending soldiers one at a time to take a beachhead, which would kill each one of them. He suggested keeping this bill in context, because "they would all move forward if it was a policy call of the state." Noting that he wanted the committee to discuss whether 20-year retirement is a good policy call, Chair Coghill said he'd struggled with whether a person could come into the workforce at age 20 and retire by age [40], for example; he offered his opinion that it is a bad policy call. Number 1193 CHAIR COGHILL reiterated that the other policy call was the equity issue. He said, as he understood it, "the reason that we did it with the police ... was [that] you don't want a 55-year- old man trying to wrestle people to the ground and put them in the trooper cars, or chase them, or run and have to physically subdue people." The compelling case there, he said, was to bring in the early retirement and allow that police force to move along. He said he thinks that some of the "best and brightest" have been lost. Juvenile officers also have to handle people who are unpredictable and don't care what the consequences are, he said. Chair Coghill added that those points, combined with many of the mental health and alcohol-and- drug issues, made this an issue compelling enough to him to bring up the discussion. Number 1299 REPRESENTATIVE JAMES noted that things have changed in the workforce; people can have several different careers in a lifetime. These are stressful times, she noted; therefore, perhaps 20 years "doing this particular job" is enough, no matter how much the employee gets paid. Perhaps these employees want to be able to go back to school and pursue other options such as management, for example. She mentioned having a measurement of why this [bill] is needed. CHAIR COGHILL assured members, from having repeatedly visited halfway houses and jails in the Fairbanks area, that those who incarcerate youth have more difficulty, more hands-on time with the [offenders], and fewer bars and locks [than adult officers], and many times they have to actually sit on the youths. There is reason not to be there, he said, if an employee can do the same type of work in much better circumstances and get an "easier retirement" [in a different system]. Number 1460 REPRESENTATIVE STEVENS stated his belief that [HB 248] is a good bill that should be moved forward, although the arguments for [similar retirement] for other positions cannot be wished away. For example, many Alaska Department of Fish & Game officers put their lives in jeopardy; some have lost their lives. He said, "So that's another issue for another day." REPRESENTATIVE STEVENS pointed out that just because people are offered 20-year retirement doesn't mean they necessarily retire at 20 years. He said he knows many teachers who have 20-year retirement and have worked 25 or 30 years or more. He referred to Representative James's previous comments regarding people who come back [from retirement], and he mentioned retired teachers returning to work and people coming back to part-time jobs. He concluded that he thinks that [juvenile youth counselors] are asked to perform a difficult job, and reiterated that he is in favor of moving [HB 248] forward. Number 1530 CHAIR COGHILL again indicated he believes the other cases aren't as compelling. He noted that the retirement [in the bill] would be under PERS [Public Employees' Retirement System], and so it would be less economic to stay after that 20-year period; it would cost employees to continue to work. He surmised that that would be addressed at some point, if [this bill passes]. In response to a request for clarification, he noted that after the 20-year retirement, the employees' accrual rate changes if they continue their employment. He deferred to Mr. Bell for further clarification. Number 1635 GUY BELL, Director, Division of Retirement & Benefits, Department of Administration, explained, "The benefit multiplier is 2.5 percent for police and fire, from after ten years all the way through the total number of years a person stays on." Regarding a 20-year retirement, he said patterns change accordingly; for example, he thinks the average teacher retiring with a service retirement does so at between 22 and 23 [years]. He said he thinks that when the opportunity [to retire] is available, people will take it because the retirement benefit can be received while they take on other employment, thereby receiving two checks. He offered his belief that people either move on because of being burned out or because they can receive both a retirement check and a paycheck somewhere else. Number 1700 CHAIR COGHILL said it had been represented to him by some police officers that they couldn't afford "not to retire." He said he could understand why, if their expertise could be used in another managerial position while they drew retirement. Number 1720 REPRESENTATIVE STEVENS said he understood that; however, many people continue working long past retirement, knowing that they are accruing 2.5 percent a year; they aren't ready to retire or look for a part-time job "flipping burgers somewhere," for example. He reiterated that it seems there is an advantage for people who retire [from the state] to continue working [elsewhere]. MR. BELL agreed that a number of people do, but said there are peace officers in the system who have more than 30 years of service. He added, "The behavior is individual." Number 1743 REPRESENTATIVE JAMES moved to report HB 248 out of committee with individual recommendations and the accompanying zero fiscal note. There being no objection, HB 248 was moved out of the House State Affairs Standing Committee.
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