Legislature(2005 - 2006)
05/07/2005 07:32 PM Joint 141
| Audio | Topic |
|---|---|
| Start | |
| SB141 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
SB 141-PUBLIC EMPLOYEE/TEACHER RETIREMENT/BOARDS
CHAIR LYDA GREEN called the Conference Committee on SB 141
meeting to order at 7:32:12 PM. All members were present.
SB 141-PUBLIC EMPLOYEE/TEACHER RETIREMENT/BOARDS
CHAIR GREEN said she hoped to get through the points of
agreement and disagreement and report back to the House and
CHAIR LYDA GREEN called the Conference Committee on SB 141
Senate.
meeting to order at 7:32:12 PM. All members were present.
CHAIR GREEN said she hoped to get through the points of
SENATOR SEEKINS moved that the Senate request the House
agreement and disagreement and report back to the House and
recede from its amendments to CSSB 141(FIN).
Senate.
An unidentified member objected.
SENATOR SEEKINS moved that the Senate request the House
recede from its amendments to CSSB 141(FIN).
A roll call vote was taken. Representatives Seaton,
Crawford, and Weyhrauch and Senator Olson were opposed and
An unidentified member objected.
Senators Green and Seekins were in favor, therefore the
motion failed.
A roll call vote was taken. Representatives Seaton,
Crawford, and Weyhrauch and Senator Olson were opposed and
REPRESENTATIVE WEYHRAUCH moved that the Senate concur with
Senators Green and Seekins were in favor, therefore the
the changes contained in HCS CSSB 141(FIN)am H.
motion failed.
CHAIR GREEN objected.
REPRESENTATIVE WEYHRAUCH moved that the Senate concur with
the changes contained in HCS CSSB 141(FIN)am H.
A roll call vote was taken. Senator Olson and
Representatives Weyhrauch, Crawford and Seaton were in
CHAIR GREEN objected.
favor and Senators Seekins and Green were opposed.
A roll call vote was taken. Senator Olson and
CHAIR GREEN announced the motion failed, requiring two
Representatives Weyhrauch, Crawford and Seaton were in
affirmative votes from each house. She then informed
favor and Senators Seekins and Green were opposed.
members that several bill comparisons had been distributed;
the comparison done by her staff is the most recent and
CHAIR GREEN announced the motion failed, requiring two
contains the provisions of the bill with no substantial
affirmative votes from each house. She then informed
differences. Senate members are willing to accept the House
members that several bill comparisons had been distributed;
language on those provisions at this time.
the comparison done by her staff is the most recent and
contains the provisions of the bill with no substantial
7:34:17 PM
differences. Senate members are willing to accept the House
language on those provisions at this time.
REPRESENTATIVE SEATON clarified that in the rush to get
things done, in the House comparison the Senate and House
7:34:17 PM
provisions are reversed so that the provisions under the
Senate column are the House provisions and vice versa.
REPRESENTATIVE SEATON clarified that in the rush to get
things done, in the House comparison the Senate and House
REPRESENTATIVE WEYHRAUCH noted Senate Finance Committee
provisions are reversed so that the provisions under the
staff prepared the document referred to by Chair Green;
Senate column are the House provisions and vice versa.
Representative Seaton provided a comparison; and the third
double-sided document explains all elements of the bill.
REPRESENTATIVE WEYHRAUCH noted Senate Finance Committee
staff prepared the document referred to by Chair Green;
CHAIR GREEN affirmed that members would work from the
Representative Seaton provided a comparison; and the third
Senate Finance Committee document, which has numbered
double-sided document explains all elements of the bill.
columns.
CHAIR GREEN affirmed that members would work from the
7:37:31 PM
Senate Finance Committee document, which has numbered
columns.
CHAIR GREEN began reviewing the comparison and directed
members to line 7, employee contribution rates, and said
7:37:31 PM
the Senate is agreeable to the House plan.
CHAIR GREEN began reviewing the comparison and directed
REPRESENTATIVE WEYHRAUCH asked if column d contains the
members to line 7, employee contribution rates, and said
provisions in the House bill while column b contains the
the Senate is agreeable to the House plan.
provisions in the Senate bill as received by the House.
REPRESENTATIVE WEYHRAUCH asked if column d contains the
CHAIR GREEN clarified that column b contains the provisions
provisions in the House bill while column b contains the
in the bill passed by the Senate while column d contains
provisions in the Senate bill as received by the House.
the provisions of the bill passed by the House. She
repeated that in column d, line 7, the employee
CHAIR GREEN clarified that column b contains the provisions
contribution will remain unchanged.
in the bill passed by the Senate while column d contains
the provisions of the bill passed by the House. She
7:41:26 PM
repeated that in column d, line 7, the employee
contribution will remain unchanged.
SENATOR SEEKINS asked if the Senate plan was a floating
plan while the House plan was a fixed plan.
7:41:26 PM
REPRESENTATIVE SEATON explained the Senate plan contains an
SENATOR SEEKINS asked if the Senate plan was a floating
escalator for the employee, which increases the
plan while the House plan was a fixed plan.
contribution by .5 percent per year until the amount equals
the employer contribution. He noted that questions of the
REPRESENTATIVE SEATON explained the Senate plan contains an
legality of that method were raised.
escalator for the employee, which increases the
contribution by .5 percent per year until the amount equals
CHAIR GREEN referred to line 9, column d, and said the 5
the employer contribution. He noted that questions of the
percent to the DC account as listed in the House plan is
legality of that method were raised.
acceptable to the Senate.
CHAIR GREEN referred to line 9, column d, and said the 5
CHAIR GREEN directed members to page 2, line 24, and said
percent to the DC account as listed in the House plan is
the House gave the board the additional duty of assisting
acceptable to the Senate.
the retirement system administrator in prescribing policies
for the operation of the retirement system. The Senate is
CHAIR GREEN directed members to page 2, line 24, and said
agreeable to that directive.
the House gave the board the additional duty of assisting
the retirement system administrator in prescribing policies
CHAIR GREEN moved to the language on line 25, which speaks
for the operation of the retirement system. The Senate is
to the $400 honorarium plus per diem, and said the Senate
agreeable to that directive.
finds that to be acceptable.
CHAIR GREEN moved to the language on line 25, which speaks
SENATOR SEEKINS commented that the intent of that provision
to the $400 honorarium plus per diem, and said the Senate
is to mirror the per diem paid to the Alaska Permanent Fund
finds that to be acceptable.
Corporation board of trustees.
SENATOR SEEKINS commented that the intent of that provision
REPRESENTATIVE SEATON said that is correct, as well as the
is to mirror the per diem paid to the Alaska Permanent Fund
directors of the board of the Alaska Housing Finance
Corporation board of trustees.
Corporation.
REPRESENTATIVE SEATON said that is correct, as well as the
7:41:52 PM
directors of the board of the Alaska Housing Finance
Corporation.
CHAIR GREEN said the Senate is agreeable to the provision
on page 3, line 27, to change the fund ratio to 105
7:41:52 PM
percent.
CHAIR GREEN said the Senate is agreeable to the provision
CHAIR GREEN referred to the provision on page 3, line 29,
on page 3, line 27, to change the fund ratio to 105
which closes a loophole, and said the Senate is agreeable.
percent.
SENATOR SEEKINS asked if it applies to minor dependents
CHAIR GREEN referred to the provision on page 3, line 29,
only.
which closes a loophole, and said the Senate is agreeable.
REPRESENTATIVE SEATON explained that it applies to
SENATOR SEEKINS asked if it applies to minor dependents
dependents with no relationship to the retiree before he or
only.
she died.
REPRESENTATIVE SEATON explained that it applies to
SENATOR SEEKINS asked if any age limits apply to dependents
dependents with no relationship to the retiree before he or
or if the benefit is dependent on IRS status.
she died.
REPRESENTATIVE SEATON believed the definition of
SENATOR SEEKINS asked if any age limits apply to dependents
"dependent" is from the existing retirement system so no
or if the benefit is dependent on IRS status.
changes would occur.
REPRESENTATIVE SEATON believed the definition of
CHAIR GREEN stated, "They're already dependent adults that
"dependent" is from the existing retirement system so no
might be covered, as well as certainly your children that
changes would occur.
you would have custody of."
CHAIR GREEN stated, "They're already dependent adults that
REPRESENTATIVE SEATON said his understanding is that if the
might be covered, as well as certainly your children that
retiree dies and the spouse later adopts or has a
you would have custody of."
dependent, the new dependent would not be covered.
REPRESENTATIVE SEATON said his understanding is that if the
7:44:09 PM
retiree dies and the spouse later adopts or has a
dependent, the new dependent would not be covered.
CHAIR GREEN moved to line 32 and said the House removed
language regarding forfeiting all rights under this
7:44:09 PM
chapter, which the Senate is agreeable to. She noted that
language is in existing law so nothing will change.
CHAIR GREEN moved to line 32 and said the House removed
language regarding forfeiting all rights under this
CHAIR GREEN explained that the language on page 4, line 36,
chapter, which the Senate is agreeable to. She noted that
pertains to conditional retroactivity, which the Senate
language is in existing law so nothing will change.
finds acceptable.
CHAIR GREEN explained that the language on page 4, line 36,
7:44:48 PM
pertains to conditional retroactivity, which the Senate
finds acceptable.
REPRESENTATIVE WEYHRAUCH asked about line 3 above line 36.
7:44:48 PM
CHAIR GREEN said the number 3 was erroneously implanted on
every page and asked members to ignore it.
REPRESENTATIVE WEYHRAUCH asked about line 3 above line 36.
7:46:13 PM
CHAIR GREEN said the number 3 was erroneously implanted on
every page and asked members to ignore it.
CHAIR GREEN announced a 10-minute break.
7:46:13 PM
8:03:47 PM
CHAIR GREEN announced a 10-minute break.
REPRESENTATIVE SEATON informed members the House would
accept the Senate schedule on page 1, line 13, but in
8:03:47 PM
several places in the Senate version, such as on page 93,
lines 4 and 5, the bill refers to age 65 instead of
REPRESENTATIVE SEATON informed members the House would
Medicare eligible. House members are agreeable as long as
accept the Senate schedule on page 1, line 13, but in
the understanding is that the correct term is "Medicare
several places in the Senate version, such as on page 93,
eligible" and that term is used.
lines 4 and 5, the bill refers to age 65 instead of
Medicare eligible. House members are agreeable as long as
CHAIR GREEN stated that "Medicare eligible" would be used
the understanding is that the correct term is "Medicare
throughout the bill.
eligible" and that term is used.
SENATOR SEEKINS pointed out the conference committee cannot
CHAIR GREEN stated that "Medicare eligible" would be used
amend the bill.
throughout the bill.
8:04:33 PM
SENATOR SEEKINS pointed out the conference committee cannot
amend the bill.
CHAIR GREEN announced an at-ease.
8:04:33 PM
8:05:44 PM
CHAIR GREEN announced an at-ease.
CHAIR GREEN informed members [the conference committee can
request] that a technical correction be made to the bill by
8:05:44 PM
the legal drafter to make that language consistent.
CHAIR GREEN informed members [the conference committee can
REPRESENTATIVE SEATON referred to the language on line 28
request] that a technical correction be made to the bill by
and said the problem is the retroactivity to 1987. He said
the legal drafter to make that language consistent.
the House has no problem making that change prospectively
but it cannot agree to diminish accrued benefits.
REPRESENTATIVE SEATON referred to the language on line 28
and said the problem is the retroactivity to 1987. He said
CHAIR GREEN said that provision would be left open for
the House has no problem making that change prospectively
further discussion at a later date.
but it cannot agree to diminish accrued benefits.
8:07:26 PM
CHAIR GREEN said that provision would be left open for
further discussion at a later date.
CHAIR GREEN informed members that by accepting the language
on page 1, line 9, the reference on line 5 would also be
8:07:26 PM
accepted.
CHAIR GREEN informed members that by accepting the language
REPRESENTATIVE SEATON said that is correct.
on page 1, line 9, the reference on line 5 would also be
accepted.
CHAIR GREEN explained that one is 5 percent; the other is 8
percent so the total would be 13 percent. She then said the
REPRESENTATIVE SEATON said that is correct.
Senate would also agree to accept line 5.
CHAIR GREEN explained that one is 5 percent; the other is 8
8:09:03 PM
percent so the total would be 13 percent. She then said the
Senate would also agree to accept line 5.
SENATOR SEEKINS commented that in looking at the totals in
section 13, line 9, the numbers on line 5 include the 5
8:09:03 PM
percent number to equal the 13 percent. He said his
understanding of line 9 is that the 4.5 and 2.0 differ from
SENATOR SEEKINS commented that in looking at the totals in
the House version, which establishes a 2.5-fixed rate. He
section 13, line 9, the numbers on line 5 include the 5
asked if the 1.75 in the Senate version is a calculated
percent number to equal the 13 percent. He said his
number rather than a fixed number.
understanding of line 9 is that the 4.5 and 2.0 differ from
the House version, which establishes a 2.5-fixed rate. He
REPRESENTATIVE SEATON pointed out the $250 on the House
asked if the 1.75 in the Senate version is a calculated
side is also a calculated number.
number rather than a fixed number.
SENATOR SEEKINS asked if that number stays the same forever
REPRESENTATIVE SEATON pointed out the $250 on the House
in the House version or whether it is actuarially
side is also a calculated number.
calculated for a date certain.
SENATOR SEEKINS asked if that number stays the same forever
REPRESENTATIVE SEATON replied $250 is the current actuarial
in the House version or whether it is actuarially
calculation but the House version requires that medical
calculated for a date certain.
benefits be enough to satisfy the medical cost. Therefore,
the $250 would be actuarially calculated each year to
REPRESENTATIVE SEATON replied $250 is the current actuarial
prevent building up an unfunded liability.
calculation but the House version requires that medical
benefits be enough to satisfy the medical cost. Therefore,
SENATOR SEEKINS asked if the number is fixed in statute.
the $250 would be actuarially calculated each year to
prevent building up an unfunded liability.
REPRESENTATIVE SEATON referred members to line 29 on page
86 of HCS CSSB 141(FIN)am H, subsection (d).
SENATOR SEEKINS asked if the number is fixed in statute.
8:11:56 PM
REPRESENTATIVE SEATON referred members to line 29 on page
86 of HCS CSSB 141(FIN)am H, subsection (d).
CHAIR GREEN said her understanding is that in the Senate
version, the 1.75 percent is from the Mercer calculation.
8:11:56 PM
She assumed it to be a calculable rate each year.
CHAIR GREEN said her understanding is that in the Senate
SENATOR SEEKINS thought it was a fixed rate and said he
version, the 1.75 percent is from the Mercer calculation.
couldn't see where it becomes calculable in the future. He
She assumed it to be a calculable rate each year.
affirmed he was speaking to the 2.5 percent amount for the
medical [rate].
SENATOR SEEKINS thought it was a fixed rate and said he
couldn't see where it becomes calculable in the future. He
REPRESENTATIVE WEYHRAUCH said it is 2 percent by
affirmed he was speaking to the 2.5 percent amount for the
legislative fiat.
medical [rate].
SENATOR SEEKINS agreed the number will remain the same
REPRESENTATIVE WEYHRAUCH said it is 2 percent by
until changed by the legislature.
legislative fiat.
REPRESENTATIVE WEYHRAUCH thought that was the purpose of
SENATOR SEEKINS agreed the number will remain the same
requiring advice and consent and reports to the legislature
until changed by the legislature.
in other portions of the bill.
REPRESENTATIVE WEYHRAUCH thought that was the purpose of
CHAIR GREEN recalled a conversation about reaching a
requiring advice and consent and reports to the legislature
balance between the contribution rates for employees and
in other portions of the bill.
retirement health benefits. She pointed out the 1.75 is in
statute as well.
CHAIR GREEN recalled a conversation about reaching a
balance between the contribution rates for employees and
8:14:22 PM
retirement health benefits. She pointed out the 1.75 is in
statute as well.
SENATOR SEEKINS asked if the language beginning on page 51,
lines 7-14, of the House bill add a requirement for AMRB to
8:14:22 PM
annually evaluate the employer rate for medical insurance
sufficient to cover projected costs.
SENATOR SEEKINS asked if the language beginning on page 51,
lines 7-14, of the House bill add a requirement for AMRB to
REPRESENTATIVE SEATON said that was the intent.
annually evaluate the employer rate for medical insurance
sufficient to cover projected costs.
SENATOR SEEKINS said he would object to just setting a
number in statute.
REPRESENTATIVE SEATON said that was the intent.
REPRESENTATIVE SEATON said House members would too.
SENATOR SEEKINS said he would object to just setting a
number in statute.
CHAIR GREEN suggested leaving that question for the next
conference committee to address.
REPRESENTATIVE SEATON said House members would too.
REPRESENTATIVE SEATON added there are a couple of errors in
CHAIR GREEN suggested leaving that question for the next
both accounts. Although those errors were discussed on the
conference committee to address.
House floor, they were not changed because a death and
disability part was added on the House side, which adds up
REPRESENTATIVE SEATON added there are a couple of errors in
to 3/10 of a percent and the actuarial calculation was
both accounts. Although those errors were discussed on the
supposed to be there. He said Mercer calculated the 1.75
House floor, they were not changed because a death and
rate based on requiring people to retire directly from the
disability part was added on the House side, which adds up
system as it was on the House side and made a mistake
to 3/10 of a percent and the actuarial calculation was
because not retiring from the system increases the cost
supposed to be there. He said Mercer calculated the 1.75
quite a bit.
rate based on requiring people to retire directly from the
system as it was on the House side and made a mistake
SENATOR SEEKINS agreed that 175 basis points increase the
because not retiring from the system increases the cost
cost quite a bit and he is not willing to fix that [number]
quite a bit.
in statute.
SENATOR SEEKINS agreed that 175 basis points increase the
CHAIR GREEN said she would leave that open for the free
cost quite a bit and he is not willing to fix that [number]
conference committee.
in statute.
8:16:46 PM
CHAIR GREEN said she would leave that open for the free
conference committee.
REPRESENTATIVE WEYHRAUCH said the health reimbursement
provision should also be left open because the differences
8:16:46 PM
need to be determined.
REPRESENTATIVE WEYHRAUCH said the health reimbursement
CHAIR GREEN said someone had asked if a person resigned
provision should also be left open because the differences
rather than retired, that person would have access to the
need to be determined.
health reimbursement account.
CHAIR GREEN said someone had asked if a person resigned
8:20:42 PM
rather than retired, that person would have access to the
health reimbursement account.
CHAIR GREEN announced an at-ease.
8:20:42 PM
8:23:02 PM
CHAIR GREEN announced an at-ease.
CHAIR GREEN announced she would leave the last question
open for the next conference committee to address.
8:23:02 PM
SENATOR SEEKINS proposed highlighting the specific points
CHAIR GREEN announced she would leave the last question
the committee does not agree on by page number and
open for the next conference committee to address.
paragraph using the matrix.
SENATOR SEEKINS proposed highlighting the specific points
CHAIR GREEN expressed skepticism about making it through
the committee does not agree on by page number and
100 pages.
paragraph using the matrix.
SENATOR SEEKINS said he wanted to look at each referenced
CHAIR GREEN expressed skepticism about making it through
page.
100 pages.
REPRESENTATIVE SEATON referred to line 8 on the matrix.
SENATOR SEEKINS said he wanted to look at each referenced
page.
SENATOR SEEKINS clarified that would be pages 73-74,
sections 7-8 of the House version and pages 71-72, sections
REPRESENTATIVE SEATON referred to line 8 on the matrix.
95 and 96 in the Senate version.
SENATOR SEEKINS clarified that would be pages 73-74,
REPRESENTATIVE SEATON explained line 8 sets a floor for
sections 7-8 of the House version and pages 71-72, sections
PERS and TRS contributions to prevent another shortfall
95 and 96 in the Senate version.
from occurring, like the one that occurred after the PERS
contribution was lowered to 6.75 percent. It will smooth
REPRESENTATIVE SEATON explained line 8 sets a floor for
out the long-range contributions to the system so the state
PERS and TRS contributions to prevent another shortfall
does not generate past service costs. TRS did keep a floor
from occurring, like the one that occurred after the PERS
at 11 percent so the contribution never went down but PERS
contribution was lowered to 6.75 percent. It will smooth
brought its normal cost rates down to 6.75 a couple of
out the long-range contributions to the system so the state
years ago. He thought that earlier, the committee accepted
does not generate past service costs. TRS did keep a floor
the elimination of the employee contribution - the 50
at 11 percent so the contribution never went down but PERS
percent match with the .5 percent escalator on line 7,
brought its normal cost rates down to 6.75 a couple of
which corresponds to line 8 in the Senate bill. He said the
years ago. He thought that earlier, the committee accepted
Senate version says 50 percent of the normal cost rate.
the elimination of the employee contribution - the 50
Line 7 said the employee rate would increase .5 percent
percent match with the .5 percent escalator on line 7,
each year until the two matched. Since the Senate agreed to
which corresponds to line 8 in the Senate bill. He said the
eliminate that language, it also eliminated the employer 50
Senate version says 50 percent of the normal cost rate.
percent match. He questioned whether the Senate would
Line 7 said the employee rate would increase .5 percent
accept the floor on employer contributions in the House
each year until the two matched. Since the Senate agreed to
version.
eliminate that language, it also eliminated the employer 50
percent match. He questioned whether the Senate would
8:26:53 PM
accept the floor on employer contributions in the House
version.
CHAIR GREEN said she thought the [Senate] was trying to
craft the language to assure there would be participation
8:26:53 PM
at the normal service rate. She suggested leaving that
provision open for future discussion.
CHAIR GREEN said she thought the [Senate] was trying to
craft the language to assure there would be participation
REPRESENTATIVE SEATON said that is fine. He said when
at the normal service rate. She suggested leaving that
looked at carefully, one can see that lines 7 and 8 are
provision open for future discussion.
tied together. He explained that because the Senate agreed
to remove the escalator from the employee rate up to 50
REPRESENTATIVE SEATON said that is fine. He said when
percent, the reference to the employer paying up to 50
looked at carefully, one can see that lines 7 and 8 are
percent does not make sense.
tied together. He explained that because the Senate agreed
to remove the escalator from the employee rate up to 50
CHAIR GREEN repeated she would leave that open.
percent, the reference to the employer paying up to 50
percent does not make sense.
SENATOR SEEKINS asked if the House and Senate are not in
agreement on line 5.
CHAIR GREEN repeated she would leave that open.
CHAIR GREEN said they are.
SENATOR SEEKINS asked if the House and Senate are not in
agreement on line 5.
SENATOR SEEKINS said the House and Senate agree on line 7
but they are not in agreement on lines 8 and 9. He asked,
CHAIR GREEN said they are.
regarding line 11, why the House views its version to be
more advantageous.
SENATOR SEEKINS said the House and Senate agree on line 7
but they are not in agreement on lines 8 and 9. He asked,
REPRESENTATIVE SEATON explained the requirement for medical
regarding line 11, why the House views its version to be
benefits is 10 years of service. If employees are not
more advantageous.
required to retire directly from the system with 30 years
of service at any age or at age 60 with at least 10 years,
REPRESENTATIVE SEATON explained the requirement for medical
a person could work from age 22 to 32, leave the state, and
benefits is 10 years of service. If employees are not
have medical benefits provided by the state at age 60. When
required to retire directly from the system with 30 years
Mercer calculated the Senate's number, it assumed the
of service at any age or at age 60 with at least 10 years,
employee would retire directly from the system.
a person could work from age 22 to 32, leave the state, and
have medical benefits provided by the state at age 60. When
8:30:44 PM
Mercer calculated the Senate's number, it assumed the
employee would retire directly from the system.
CHAIR GREEN asked if a person who worked 30 years and
resigned would be required to come back and work to retire.
8:30:44 PM
REPRESENTATIVE SEATON said absolutely not. He said retiring
CHAIR GREEN asked if a person who worked 30 years and
directly from the system is defined as 30 years of service
resigned would be required to come back and work to retire.
or more than 10 years and reaching age 60.
REPRESENTATIVE SEATON said absolutely not. He said retiring
CHAIR GREEN said she would leave that provision open.
directly from the system is defined as 30 years of service
or more than 10 years and reaching age 60.
SENATOR SEEKINS asked for an explanation of the items on
line 12.
CHAIR GREEN said she would leave that provision open.
REPRESENTATIVE SEATON explained the House version has a
SENATOR SEEKINS asked for an explanation of the items on
pre-Medicare eligible medical coverage provision built in
line 12.
so if a person is within 5 years of being pre-Medicare
eligible, s/he can get a subsidy on medical premiums so
REPRESENTATIVE SEATON explained the House version has a
that s/he could retire at age 60. The premium subsidy would
pre-Medicare eligible medical coverage provision built in
be based on the number of years served beginning at 30
so if a person is within 5 years of being pre-Medicare
percent for 10 years of service with an increase of 3
eligible, s/he can get a subsidy on medical premiums so
percent per year up to 30 years, at which point the subsidy
that s/he could retire at age 60. The premium subsidy would
would be 90 percent. The subsidy of the premium has some
be based on the number of years served beginning at 30
cost containment built in. The start year - this year - is
percent for 10 years of service with an increase of 3
$7,900; the maximum escalation is 5 percent per year.
percent per year up to 30 years, at which point the subsidy
Therefore, if health care costs increase 12 percent per
would be 90 percent. The subsidy of the premium has some
year, 7 percent would be excluded from the calculation.
cost containment built in. The start year - this year - is
This benefit was built in because employees said medical
$7,900; the maximum escalation is 5 percent per year.
benefits are highly prized.
Therefore, if health care costs increase 12 percent per
year, 7 percent would be excluded from the calculation.
8:34:32 PM
This benefit was built in because employees said medical
benefits are highly prized.
CHAIR GREEN asked about the increased cost to the employer.
8:34:32 PM
REPRESENTATIVE SEATON said it would increase costs by 1
percent for each pre-Medicare eligible employee.
CHAIR GREEN asked about the increased cost to the employer.
CHAIR GREEN said she would leave that provision open for
REPRESENTATIVE SEATON said it would increase costs by 1
later discussion.
percent for each pre-Medicare eligible employee.
SENATOR SEEKINS said the House and Senate are not in
CHAIR GREEN said she would leave that provision open for
agreement on line 13. He then asked, regarding line 14,
later discussion.
what the normal retirement age is.
SENATOR SEEKINS said the House and Senate are not in
REPRESENTATIVE SEATON said normal retirement age is 60
agreement on line 13. He then asked, regarding line 14,
months pre-Medicare, meaning 60 years old.
what the normal retirement age is.
SENATOR SEEKINS asked if, in the House version, retirement
REPRESENTATIVE SEATON said normal retirement age is 60
begins 5 years earlier than the Senate version.
months pre-Medicare, meaning 60 years old.
REPRESENTATIVE SEATON said that is correct. He explained
SENATOR SEEKINS asked if, in the House version, retirement
that a person with 30 years of service who is not 60 would
begins 5 years earlier than the Senate version.
have to pay the full premium.
REPRESENTATIVE SEATON said that is correct. He explained
CHAIR GREEN asked if that provision merely provides access.
that a person with 30 years of service who is not 60 would
have to pay the full premium.
REPRESENTATIVE SEATON said that is correct.
CHAIR GREEN asked if that provision merely provides access.
REPRESENTATIVE SEATON said that is the same as the Senate
version. The difference between the two is the House
REPRESENTATIVE SEATON said that is correct.
version has a 60 months pre-Medicare eligible component
whereas the Senate version has no medical benefits before
REPRESENTATIVE SEATON said that is the same as the Senate
Medicare eligible age or 65.
version. The difference between the two is the House
version has a 60 months pre-Medicare eligible component
CHAIR GREEN asked for an explanation of the age range in
whereas the Senate version has no medical benefits before
the House version.
Medicare eligible age or 65.
REPRESENTATIVE SEATON said the service range in the two
CHAIR GREEN asked for an explanation of the age range in
versions is identical - 30 years or 10 years and reaching
the House version.
the age of 60. He then said, "...It's actually 10 years and
60 months pre-Medicare eligible. The reason that pre-
REPRESENTATIVE SEATON said the service range in the two
Medicare eligible is so important is because the federal
versions is identical - 30 years or 10 years and reaching
government might come around in a few years and change
the age of 60. He then said, "...It's actually 10 years and
Medicare eligible to 67 and we at the state don't want to
60 months pre-Medicare eligible. The reason that pre-
be stuck with paying 100 percent of medical costs between
Medicare eligible is so important is because the federal
65 and 67 if they raise the age limit by two years."
government might come around in a few years and change
Medicare eligible to 67 and we at the state don't want to
SENATOR SEEKINS asked if this would establish a floating
be stuck with paying 100 percent of medical costs between
rate that duplicates exactly what the Senate version would
65 and 67 if they raise the age limit by two years."
do in terms of age and eligibility now.
SENATOR SEEKINS asked if this would establish a floating
REPRESENTATIVE SEATON said the House version provides for a
rate that duplicates exactly what the Senate version would
60 months pre-Medicare eligible subsidy for insurance
do in terms of age and eligibility now.
premiums while the Senate version does not provide anything
pre-Medicare eligible.
REPRESENTATIVE SEATON said the House version provides for a
60 months pre-Medicare eligible subsidy for insurance
CHAIR GREEN noted the House version provides an extra five
premiums while the Senate version does not provide anything
years of assistance.
pre-Medicare eligible.
REPRESENTATIVE SEATON said that is correct.
CHAIR GREEN noted the House version provides an extra five
years of assistance.
CHAIR GREEN said she would leave that provision open, as
well as lines 15 and 16 as she is waiting for more figures
REPRESENTATIVE SEATON said that is correct.
on that provision.
CHAIR GREEN said she would leave that provision open, as
SENATOR SEEKINS said the difference between the House and
well as lines 15 and 16 as she is waiting for more figures
Senate versions in the health reimbursement arrangement
on that provision.
[line 17] is the 50 basis points in the House version. The
House wants to give retirees more money than the Senate
SENATOR SEEKINS said the difference between the House and
does.
Senate versions in the health reimbursement arrangement
[line 17] is the 50 basis points in the House version. The
REPRESENTATIVE SEATON said that is correct.
House wants to give retirees more money than the Senate
does.
CHAIR GREEN said some concern was expressed that the House
provision was "too rich" so she would leave that open.
REPRESENTATIVE SEATON said that is correct.
REPRESENTATIVE WEYHRAUCH asked if line 17 relates to line 9
CHAIR GREEN said some concern was expressed that the House
on page 1.
provision was "too rich" so she would leave that open.
CHAIR GREEN said it does and that a deeper discussion on
REPRESENTATIVE WEYHRAUCH asked if line 17 relates to line 9
the balance between all of those contributions needs to
on page 1.
occur because one causes one to go down and another to go
up. The right balance needs to be found so that the
CHAIR GREEN said it does and that a deeper discussion on
employer is not over contributing and she believes there is
the balance between all of those contributions needs to
room for change. She repeated she would leave that open for
occur because one causes one to go down and another to go
the free conference committee.
up. The right balance needs to be found so that the
employer is not over contributing and she believes there is
CHAIR GREEN then said she and Senator Seekins are very
room for change. She repeated she would leave that open for
concerned with line 19.
the free conference committee.
SENATOR SEEKINS said his concern is that someone could
CHAIR GREEN then said she and Senator Seekins are very
leave voluntarily and come back and get full benefits plus
concerned with line 19.
interest.
SENATOR SEEKINS said his concern is that someone could
CHAIR GREEN said that literally means someone could be kept
leave voluntarily and come back and get full benefits plus
on the books for infinity and she believes the benefit is
interest.
designed to prepare employees, not to keep them on the
books for 60 years. She said she would leave that open for
CHAIR GREEN said that literally means someone could be kept
future discussion.
on the books for infinity and she believes the benefit is
designed to prepare employees, not to keep them on the
REPRESENTATIVE SEATON said the whole design of this plan is
books for 60 years. She said she would leave that open for
a defined contribution. He continued, "And we have two
future discussion.
components of defined contribution here. One is to the
retirement plan where we're doing a percentage into there
REPRESENTATIVE SEATON said the whole design of this plan is
and the other defined contribution portion is the HRA where
a defined contribution. He continued, "And we have two
we take a certain amount of money and put it in your
components of defined contribution here. One is to the
individual account that you have and you have to own and it
retirement plan where we're doing a percentage into there
becomes portable, it becomes usable. So this is a defined
and the other defined contribution portion is the HRA where
contribution section of the medical plan."
we take a certain amount of money and put it in your
individual account that you have and you have to own and it
CHAIR GREEN said the HRA is not portable, as she
becomes portable, it becomes usable. So this is a defined
understands it.
contribution section of the medical plan."
REPRESENTATIVE SEATON said it is portable in the sense that
CHAIR GREEN said the HRA is not portable, as she
it is the employee's specific account that the employee is
understands it.
free to use for any medical expenses. It is a defined
contribution, not a defined benefit. If it were a defined
REPRESENTATIVE SEATON said it is portable in the sense that
benefit, it would say the employer would pay so much of the
it is the employee's specific account that the employee is
medical costs. This says the state will contribute 2.5
free to use for any medical expenses. It is a defined
percent of the average wage of every PERS/TRS employee for
contribution, not a defined benefit. If it were a defined
individual use. He pointed out the employee would not own
benefit, it would say the employer would pay so much of the
it until s/he met the 10 year vesting requirement.
medical costs. This says the state will contribute 2.5
percent of the average wage of every PERS/TRS employee for
8:43:30 PM
individual use. He pointed out the employee would not own
it until s/he met the 10 year vesting requirement.
SENATOR SEEKINS asked if he is sure ownership is attached
or whether the account is there for the employee's benefit
8:43:30 PM
if he continues to be an employee and retires normally.
SENATOR SEEKINS asked if he is sure ownership is attached
8:44:27 PM
or whether the account is there for the employee's benefit
if he continues to be an employee and retires normally.
REPRESENTATIVE SEATON replied, "You can look at it however
you want but if the idea of a DC plan is to make a
8:44:27 PM
contribution into an account that is accounted for - you,
individually - not for the group but you individually have
REPRESENTATIVE SEATON replied, "You can look at it however
this benefit - that's what the DC plan is and that's what
you want but if the idea of a DC plan is to make a
this is. Now it takes 10 years to vest in it just like you
contribution into an account that is accounted for - you,
have 5 years to vest in the other account."
individually - not for the group but you individually have
this benefit - that's what the DC plan is and that's what
SENATOR SEEKINS said he can see no reason why, if someone
this is. Now it takes 10 years to vest in it just like you
voluntarily separates, the state should maintain that
have 5 years to vest in the other account."
contribution and let it accrue interest in case that person
decides to come back 20 years later. He questioned why the
SENATOR SEEKINS said he can see no reason why, if someone
state should do that if "it doesn't exist in the real
voluntarily separates, the state should maintain that
world?"
contribution and let it accrue interest in case that person
decides to come back 20 years later. He questioned why the
REPRESENTATIVE WEYHRAUCH said it does exist in the real
state should do that if "it doesn't exist in the real
world because, "When your employer contributes something to
world?"
you for your benefit, it becomes a property interest."
REPRESENTATIVE WEYHRAUCH said it does exist in the real
SENATOR OLSON asked if the employee contributes to a DC
world because, "When your employer contributes something to
plan.
you for your benefit, it becomes a property interest."
CHAIR GREEN clarified the employee does not contribute to
SENATOR OLSON asked if the employee contributes to a DC
the HRA portion.
plan.
REPRESENTATIVE SEATON agreed but said the employer
CHAIR GREEN clarified the employee does not contribute to
contributes to an account for each specific employee. The
the HRA portion.
employee must submit medical invoices for reimbursement
from that account. He said the purpose of a DC plan is to
REPRESENTATIVE SEATON agreed but said the employer
attract employees.
contributes to an account for each specific employee. The
employee must submit medical invoices for reimbursement
SENATOR SEEKINS asked to leave this provision open for
from that account. He said the purpose of a DC plan is to
further negotiation because he believes the only way this
attract employees.
money will become the employee's money is if the employee
returns to state employment.
SENATOR SEEKINS asked to leave this provision open for
further negotiation because he believes the only way this
REPRESENTATIVE SEATON said that is incorrect because it
money will become the employee's money is if the employee
belongs to the employee if s/he vests in 10 years.
returns to state employment.
SENATOR SEEKINS read, "can return to participating employer
REPRESENTATIVE SEATON said that is incorrect because it
without time limitation and have account balance restored
belongs to the employee if s/he vests in 10 years.
with interest."
SENATOR SEEKINS read, "can return to participating employer
REPRESENTATIVE SEATON said that is correct and explained
without time limitation and have account balance restored
that if Senator Seekins worked for 10 years, vested, left
with interest."
state service for 5 years and returned, his account would
still be there. It is an incentive to employees to return.
REPRESENTATIVE SEATON said that is correct and explained
that if Senator Seekins worked for 10 years, vested, left
SENATOR SEEKINS said in the real world, if you leave, you
state service for 5 years and returned, his account would
leave it behind therefore he disagrees with that provision.
still be there. It is an incentive to employees to return.
CHAIR GREEN said that is one of the characteristics of the
SENATOR SEEKINS said in the real world, if you leave, you
current plan that has caused the state to be in the
leave it behind therefore he disagrees with that provision.
position it is in.
CHAIR GREEN said that is one of the characteristics of the
CHAIR GREEN moved to the next issue: board members.
current plan that has caused the state to be in the
position it is in.
8:47:17 PM
CHAIR GREEN moved to the next issue: board members.
SENATOR SEEKINS asked why only one person on the board is
not a PERS/TRS member.
8:47:17 PM
REPRESENTATIVE SEATON said the board is comprised of four
SENATOR SEEKINS asked why only one person on the board is
employer representatives and four employee representatives.
not a PERS/TRS member.
The commissioners of revenue and administration, and
finance officers of a municipality and a school district
REPRESENTATIVE SEATON said the board is comprised of four
would represent employers, while two members of the PERS
employer representatives and four employee representatives.
employee system and two members of the TRS employee system
The commissioners of revenue and administration, and
would represent employees.
finance officers of a municipality and a school district
would represent employers, while two members of the PERS
SENATOR SEEKINS asked if the commissioners and finance
employee system and two members of the TRS employee system
officers are PERS members.
would represent employees.
CHAIR GREEN said they are.
SENATOR SEEKINS asked if the commissioners and finance
officers are PERS members.
SENATOR SEEKINS noted the PERS and TRS members also
participate in the program so only one board member does
CHAIR GREEN said they are.
not. He felt that balance is out of line.
SENATOR SEEKINS noted the PERS and TRS members also
8:48:56 PM
participate in the program so only one board member does
not. He felt that balance is out of line.
REPRESENTATIVE CRAWFORD said he is a member of the
ironworkers' pension plan. That board consists of 3 members
8:48:56 PM
from the employers' group and 3 members of the employees'
group. Although they have disparate goals at times, all are
REPRESENTATIVE CRAWFORD said he is a member of the
covered by the same plan. He thought the House composition
ironworkers' pension plan. That board consists of 3 members
is much fairer than the Senate composition.
from the employers' group and 3 members of the employees'
group. Although they have disparate goals at times, all are
SENATOR SEEKINS said he sees the two commissioners and two
covered by the same plan. He thought the House composition
finance officers as employees of the state. He asked if
is much fairer than the Senate composition.
something goes wrong with the ironworkers' [retirement
plan], the general public would be asked to make up the
SENATOR SEEKINS said he sees the two commissioners and two
deficit as would happen with PERS and TRS. He said the
finance officers as employees of the state. He asked if
person who is not a beneficiary of PERS and TRS should be
something goes wrong with the ironworkers' [retirement
part of the balance of this committee.
plan], the general public would be asked to make up the
deficit as would happen with PERS and TRS. He said the
REPRESENTATIVE WEYHRAUCH asked if the ratio under the
person who is not a beneficiary of PERS and TRS should be
Senate version was 6 PERS/TRS members to 3 non-PERS/TRS
part of the balance of this committee.
members versus the 8 PERS/TRS members to 1 non-PERS/TRS
member in the House version.
REPRESENTATIVE WEYHRAUCH asked if the ratio under the
Senate version was 6 PERS/TRS members to 3 non-PERS/TRS
SENATOR SEEKINS said that is correct. He likened the House
members versus the 8 PERS/TRS members to 1 non-PERS/TRS
composition to allowing the fox to watch over the hen
member in the House version.
house. Someone who is qualified and not a beneficiary of
the PERS/TRS system should be on the board.
SENATOR SEEKINS said that is correct. He likened the House
composition to allowing the fox to watch over the hen
CHAIR GREEN told members the Senate used the Permanent Fund
house. Someone who is qualified and not a beneficiary of
board as a model. It was looking for highly trained
the PERS/TRS system should be on the board.
investors. She added the Senate sees this board as a very
hard working board and supports the honorarium for that
CHAIR GREEN told members the Senate used the Permanent Fund
reason. She said she prefers to have 3 unconnected people
board as a model. It was looking for highly trained
on the board.
investors. She added the Senate sees this board as a very
hard working board and supports the honorarium for that
SENATOR SEEKINS said he is not accusing anyone of being
reason. She said she prefers to have 3 unconnected people
less than honorable; he just feels the board should be more
on the board.
balanced.
SENATOR SEEKINS said he is not accusing anyone of being
REPRESENTATIVE SEATON replied the commissioners would not
less than honorable; he just feels the board should be more
be representing their individual membership in PERS and
balanced.
TRS, but rather the State of Alaska. He clarified that in a
House Finance version, the PERS/TRS members were to be
REPRESENTATIVE SEATON replied the commissioners would not
elected, which put them outside of the required criteria
be representing their individual membership in PERS and
for other board members. In the final House version, all
TRS, but rather the State of Alaska. He clarified that in a
members must meet the same criteria.
House Finance version, the PERS/TRS members were to be
elected, which put them outside of the required criteria
8:54:49 PM
for other board members. In the final House version, all
members must meet the same criteria.
SENATOR OLSON said in his businesses, when negotiating with
employees, he and his managers are in the same retirement
8:54:49 PM
program as his employees but his managers represent his
side. He said he tends to favor the House composition and
SENATOR OLSON said in his businesses, when negotiating with
questioned how many Permanent Fund board members are not
employees, he and his managers are in the same retirement
permanent fund dividend recipients.
program as his employees but his managers represent his
side. He said he tends to favor the House composition and
SENATOR SEEKINS said every resident receives an equal
questioned how many Permanent Fund board members are not
permanent fund dividend but not every resident gets
permanent fund dividend recipients.
retirement benefits from the state. He noted he is in the
process of creating a bright line in the ethics law that
SENATOR SEEKINS said every resident receives an equal
says if a public officer has an investment worth $10,000 or
permanent fund dividend but not every resident gets
more and that officer's action could benefit that
retirement benefits from the state. He noted he is in the
investment, the officer must put that investment in an
process of creating a bright line in the ethics law that
account that s/he has no management control over. He said
says if a public officer has an investment worth $10,000 or
because the State of Alaska has an interest in the success
more and that officer's action could benefit that
of this program, it should have more than one member who is
investment, the officer must put that investment in an
not a beneficiary of the system.
account that s/he has no management control over. He said
because the State of Alaska has an interest in the success
CHAIR GREEN announced that issue would remain open.
of this program, it should have more than one member who is
not a beneficiary of the system.
Regarding line 22, board terms, SENATOR SEEKINS said his
understanding is that the structure of the board in the
CHAIR GREEN announced that issue would remain open.
Senate version is modeled after the Permanent Fund board.
As a former chair of that board, the only thing he found he
Regarding line 22, board terms, SENATOR SEEKINS said his
did not like was that every board member was a political
understanding is that the structure of the board in the
appointee who sat at the will of the governor. The
Senate version is modeled after the Permanent Fund board.
legislature changed that last year so that now members are
As a former chair of that board, the only thing he found he
appointed to staggered terms and they can only be removed
did not like was that every board member was a political
for cause. He said three-year terms provide a chance to
appointee who sat at the will of the governor. The
evaluate members' service. He sees no reason to change.
legislature changed that last year so that now members are
appointed to staggered terms and they can only be removed
REPRESENTATIVE SEATON said the House went with a 6-year
for cause. He said three-year terms provide a chance to
term because 3-year terms with a 9 member board means that
evaluate members' service. He sees no reason to change.
a single term governor would replace the entire board. The
6-year term would allow for some staggering so that doesn't
REPRESENTATIVE SEATON said the House went with a 6-year
happen.
term because 3-year terms with a 9 member board means that
a single term governor would replace the entire board. The
CHAIR GREEN said the differences between the House and
6-year term would allow for some staggering so that doesn't
Senate board terms leave a lot of room for modifications so
happen.
she would leave that open.
CHAIR GREEN said the differences between the House and
CHAIR GREEN referred to line 23, board duties, and said she
Senate board terms leave a lot of room for modifications so
would leave that open.
she would leave that open.
SENATOR SEEKINS asked for the rationale of line 23.
CHAIR GREEN referred to line 23, board duties, and said she
would leave that open.
REPRESENTATIVE SEATON said one big problem of past service
costs was not recognizing the changes to medical costs. The
SENATOR SEEKINS asked for the rationale of line 23.
House thought the medical component should be analyzed each
year to make sure the state doesn't get behind on projected
REPRESENTATIVE SEATON said one big problem of past service
medical benefits.
costs was not recognizing the changes to medical costs. The
House thought the medical component should be analyzed each
REPRESENTATIVE WEYHRAUCH indicated the medical benefits
year to make sure the state doesn't get behind on projected
have always been projected to be the largest component of
medical benefits.
the financial impact and most subject to change.
REPRESENTATIVE WEYHRAUCH indicated the medical benefits
CHAIR GREEN thought that was included as an assumption but
have always been projected to be the largest component of
she would check.
the financial impact and most subject to change.
REPRESENTATIVE SEATON said the other assumptions are made
CHAIR GREEN thought that was included as an assumption but
every four years.
she would check.
CHAIR GREEN thought another review kicks in on alternate
REPRESENTATIVE SEATON said the other assumptions are made
years as well.
every four years.
REPRESENTATIVE WEYHRAUCH indicated that everyone was in
CHAIR GREEN thought another review kicks in on alternate
agreement about line 27.
years as well.
CHAIR GREEN said the committee agreed to leave line 28 open
REPRESENTATIVE WEYHRAUCH indicated that everyone was in
and it agreed upon line 29.
agreement about line 27.
9:00:55 PM
CHAIR GREEN said the committee agreed to leave line 28 open
and it agreed upon line 29.
CHAIR GREEN said regarding line 30, the University of
Alaska (UA) requested this language. The UA prefers the
9:00:55 PM
Senate language because it was part of a complete package
it brought to the Senate. The current language provides a
CHAIR GREEN said regarding line 30, the University of
one-time option for current employees who choose to
Alaska (UA) requested this language. The UA prefers the
participate in PERS/TRS to transfer into the existing
Senate language because it was part of a complete package
optional retirement program. She said she was not sure she
it brought to the Senate. The current language provides a
wanted to revise the UA's optional retirement program.
one-time option for current employees who choose to
participate in PERS/TRS to transfer into the existing
REPRESENTATIVE SEATON explained the House did that for two
optional retirement program. She said she was not sure she
reasons. First, a lot of people move into the University
wanted to revise the UA's optional retirement program.
system and then into school districts or boroughs. This
would give UA blue-collar workers a different plan from
REPRESENTATIVE SEATON explained the House did that for two
professors that would not be transferable. He cautioned if
reasons. First, a lot of people move into the University
the UA has a separate system that is done by the Board of
system and then into school districts or boroughs. This
Regents, it would no longer conform with PERS so blue
would give UA blue-collar workers a different plan from
collar workers could not transfer from a municipality to
professors that would not be transferable. He cautioned if
the UA. For that reason, the House left the optional
the UA has a separate system that is done by the Board of
program intact but all other employees would be in the
Regents, it would no longer conform with PERS so blue
defined contribution PERS program established here.
collar workers could not transfer from a municipality to
the UA. For that reason, the House left the optional
CHAIR GREEN asked if new employees could choose a defined
program intact but all other employees would be in the
benefits program or defined contribution program.
defined contribution PERS program established here.
REPRESENTATIVE SEATON explained the employee would either
CHAIR GREEN asked if new employees could choose a defined
have the SB 141 defined contribution plan or the UA's
benefits program or defined contribution program.
optional plan, which is a defined contribution plan as
well. That would allow blue-collar workers to go from one
REPRESENTATIVE SEATON explained the employee would either
PERS job to another.
have the SB 141 defined contribution plan or the UA's
optional plan, which is a defined contribution plan as
CHAIR GREEN asked if UA talked about forecasting
well. That would allow blue-collar workers to go from one
difficulties arising from the difference.
PERS job to another.
REPRESENTATIVE WEYHRAUCH said he did not recall any such
CHAIR GREEN asked if UA talked about forecasting
testimony in the House Finance Committee. He said UA does
difficulties arising from the difference.
that now with its professorial and administrative staff
because it can offer the defined contribution plan.
REPRESENTATIVE WEYHRAUCH said he did not recall any such
testimony in the House Finance Committee. He said UA does
9:04:39 PM
that now with its professorial and administrative staff
because it can offer the defined contribution plan.
SENATOR OLSON said it was his understanding that UA wanted
a hybrid plan and asked whether Representative Seaton is
9:04:39 PM
saying that will be denied.
SENATOR OLSON said it was his understanding that UA wanted
REPRESENTATIVE SEATON replied the UA testified that it
a hybrid plan and asked whether Representative Seaton is
wanted to go to a defined contribution plan for everyone,
saying that will be denied.
although there would be different levels of it. The House
version says the defined contribution plan that applies to
REPRESENTATIVE SEATON replied the UA testified that it
most everyone will be the same as the state's defined
wanted to go to a defined contribution plan for everyone,
contribution plan and UA will have the ability to offer an
although there would be different levels of it. The House
optional plan. He affirmed there was no hybrid plan.
version says the defined contribution plan that applies to
most everyone will be the same as the state's defined
CHAIR GREEN noted both bodies have agreed on line 32.
contribution plan and UA will have the ability to offer an
optional plan. He affirmed there was no hybrid plan.
9:05:56 PM
CHAIR GREEN noted both bodies have agreed on line 32.
SENATOR SEEKINS asked for an explanation of line 33.
9:05:56 PM
REPRESENTATIVE SEATON stated, "What that is, it's not only
AVTechs, it's also Department of Labor has welding
SENATOR SEEKINS asked for an explanation of line 33.
instructors out - I think it's in Bethel and you know
wherever they have instructors that they hire that are
REPRESENTATIVE SEATON stated, "What that is, it's not only
teachers that are in TRS system, this means they would
AVTechs, it's also Department of Labor has welding
continue in the TRS system instead of stopping the TRS
instructors out - I think it's in Bethel and you know
system and having to be in PERS because then if they had
wherever they have instructors that they hire that are
qualified in one they would be basically having two state
teachers that are in TRS system, this means they would
retirement programs. So this means that if they are a
continue in the TRS system instead of stopping the TRS
member of TRS when they go in as an instructor in the
system and having to be in PERS because then if they had
Department of Labor, they will stay in the TRS system
qualified in one they would be basically having two state
because there are slight differences. But if they're not,
retirement programs. So this means that if they are a
they're in the PERS system."
member of TRS when they go in as an instructor in the
Department of Labor, they will stay in the TRS system
SENATOR SEEKINS asked if Representative Seaton's
because there are slight differences. But if they're not,
understanding is that people in the AVTech programs would
they're in the PERS system."
stay there forever or that they don't want to go back to
being a blue-collar worker.
SENATOR SEEKINS asked if Representative Seaton's
understanding is that people in the AVTech programs would
9:07:02 PM
stay there forever or that they don't want to go back to
being a blue-collar worker.
REPRESENTATIVE WEYHRAUCH said he heard testimony about how
a welder who works for the city in a village might be asked
9:07:02 PM
to be a welding instructor. This would allow the welder to
do that without getting into a separate retirement system.
REPRESENTATIVE WEYHRAUCH said he heard testimony about how
It is designed to pick up on the skilled labor in those
a welder who works for the city in a village might be asked
areas.
to be a welding instructor. This would allow the welder to
do that without getting into a separate retirement system.
REPRESENTATIVE SEATON said that is not quite what this
It is designed to pick up on the skilled labor in those
does. He explained that blue-collar workers who come to the
areas.
Department of Labor to teach welding would be in PERS. This
would apply to people like high school teachers who are
REPRESENTATIVE SEATON said that is not quite what this
already in TRS who are brought to the Department of Labor
does. He explained that blue-collar workers who come to the
to teach - they would then change to PERS. Those people
Department of Labor to teach welding would be in PERS. This
would remain in TRS but anyone who is not already in TRS
would apply to people like high school teachers who are
would be in PERS.
already in TRS who are brought to the Department of Labor
to teach - they would then change to PERS. Those people
CHAIR GREEN asked how many people this would apply to.
would remain in TRS but anyone who is not already in TRS
would be in PERS.
REPRESENTATIVE SEATON said maybe 10 to 12 people in Seward
and some in Kotzebue. He provided the history of the
CHAIR GREEN asked how many people this would apply to.
problem.
REPRESENTATIVE SEATON said maybe 10 to 12 people in Seward
CHAIR GREEN asked if those employees preferred to be in TRS
and some in Kotzebue. He provided the history of the
because the benefits are better.
problem.
REPRESENTATIVE SEATON said the workers who were in TRS
CHAIR GREEN asked if those employees preferred to be in TRS
before would have to cancel out and change over to PERS. If
because the benefits are better.
they were vested in TRS, they would have that retirement
system and would be forced to pick up the new PERS.
REPRESENTATIVE SEATON said the workers who were in TRS
before would have to cancel out and change over to PERS. If
CHAIR GREEN said she would leave line 33 open.
they were vested in TRS, they would have that retirement
system and would be forced to pick up the new PERS.
CHAIR GREEN said she does not believe the contents of line
34 should be placed in statute. She said the board has
CHAIR GREEN said she would leave line 33 open.
instructions and goals already and that the cost savings
measures are an administrative function. She said line 34
CHAIR GREEN said she does not believe the contents of line
would be left open.
34 should be placed in statute. She said the board has
instructions and goals already and that the cost savings
REPRESENTATIVE SEATON mentioned the House State Affairs
measures are an administrative function. She said line 34
Committee included it as intent language but Legislative
would be left open.
Legal Services and the House Finance Committee [preferred
that it be put in the bill instead].
REPRESENTATIVE SEATON mentioned the House State Affairs
Committee included it as intent language but Legislative
REPRESENTATIVE SEATON explained that line 35 grew out of
Legal Services and the House Finance Committee [preferred
the retirement and benefits board's attempt to up generic
that it be put in the bill instead].
drug use. That use has increased from 37 to 42 percent,
saving an estimated $1 million for each 1 percent change.
REPRESENTATIVE SEATON explained that line 35 grew out of
Generic drugs are not required now so line 35 requires the
the retirement and benefits board's attempt to up generic
cost savings measures be implemented and mandatory. That
drug use. That use has increased from 37 to 42 percent,
change is estimated to save $6.5 million per year.
saving an estimated $1 million for each 1 percent change.
Generic drugs are not required now so line 35 requires the
CHAIR GREEN announced the House and Senate agree upon line
cost savings measures be implemented and mandatory. That
36 and that she would leave lines 37 and 38 open.
change is estimated to save $6.5 million per year.
CHAIR GREEN then asked members to sign the report so that
CHAIR GREEN announced the House and Senate agree upon line
it can be taken to members' respective bodies tomorrow, at
36 and that she would leave lines 37 and 38 open.
which time free conference committee members will be
appointed.
CHAIR GREEN then asked members to sign the report so that
it can be taken to members' respective bodies tomorrow, at
9:13:47 PM
which time free conference committee members will be
appointed.
SENATOR SEEKINS moved to return a letter to the Senate
President and House Speaker that states that the conference
9:13:47 PM
committee on SB 141 met on May 7, 2005 and that Senate
members failed to concur with the changes to HCS CSSB
SENATOR SEEKINS moved to return a letter to the Senate
141(FIN)am H, that the House members failed to recede from
President and House Speaker that states that the conference
their changes to CSSB 141(FIN) and that the conference
committee on SB 141 met on May 7, 2005 and that Senate
committee considered the attached sections and did not come
members failed to concur with the changes to HCS CSSB
to agreement. The conference committee respectfully
141(FIN)am H, that the House members failed to recede from
requests limited powers of free conference.
their changes to CSSB 141(FIN) and that the conference
committee considered the attached sections and did not come
CHAIR GREEN announced that with no objections, the motion
to agreement. The conference committee respectfully
carried.
requests limited powers of free conference.
REPRESENTATIVE SEATON asked if the conference committee
CHAIR GREEN announced that with no objections, the motion
should specify the areas for limited free conference.
carried.
CHAIR GREEN said the committee will sign the report when it
REPRESENTATIVE SEATON asked if the conference committee
meets at 1:45 p.m. tomorrow. She then adjourned the meeting
should specify the areas for limited free conference.
at 9:18:50 PM.
CHAIR GREEN said the committee will sign the report when it
meets at 1:45 p.m. tomorrow. She then adjourned the meeting
at 9:18:50 PM.
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