Legislature(2023 - 2024)SENATE FINANCE 532

05/10/2023 01:30 PM Senate FINANCE

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Audio Topic
02:05:33 PM Start
02:05:53 PM SB88
02:50:02 PM Adjourn
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
Heard & Held
-- Invited & Public Testimony --
-- <Time Limit May Be Set> --
+ Bills Previously Heard/Scheduled TELECONFERENCED
SENATE BILL NO. 88                                                                                                            
     "An Act  relating to  the Public  Employees' Retirement                                                                    
     System of  Alaska and the teachers'  retirement system;                                                                    
     providing  certain employees  an opportunity  to choose                                                                    
     between  the defined  benefit and  defined contribution                                                                    
     plans  of the  Public Employees'  Retirement System  of                                                                    
     Alaska  and   the  teachers'  retirement   system;  and                                                                    
     providing for an effective date."                                                                                          
2:05:53 PM                                                                                                                    
Co-Chair  Olson relayed  that the  bill  had been  initially                                                                    
heard on  May 2, 2023.   He explained that  public testimony                                                                    
would be taken as technology allowed.                                                                                           
2:06:16 PM                                                                                                                    
SENATOR CATHY GIESSEL, SPONSOR,  explained that the bill was                                                                    
a  shared risk  defined benefit  program that  would provide                                                                    
secure retirement for  state employees in Alaska  as well as                                                                    
teachers and public municipality employees.                                                                                     
2:06:53 PM                                                                                                                    
MARK    SPRINGER,    MAYOR    OF   BETHEL,    BETHEL    (via                                                                    
teleconference),  spoke in  support of  the bill.  He stated                                                                    
that the  bill would help  attract new workers to  the state                                                                    
and would encourage people to stay in Alaska.                                                                                   
Mr. Springer  relayed that  the previous Tier  1 and  Tier 2                                                                    
retirement plans  had helped to  attract and  retain workers                                                                    
in  Alaska. He  believed that  a new  defined benefit  would                                                                    
attract  future  employees. He  said  that  Bethel had  many                                                                    
tenured  employees in  Tier 1  and  Tier 2  plans. He  spoke                                                                    
about the cost  of living in rural Alaska  and believed that                                                                    
incentives were  needed to secure employees.  He argued that                                                                    
lack  of  a  defined  benefit limited  Alaskas   ability  to                                                                    
compete on  the national  stage. He urged  committee support                                                                    
for the legislation.                                                                                                            
2:10:50 PM                                                                                                                    
RORIE WATT, CITY MANAGER, CITY  AND BOROUGH OF JUNEAU, spoke                                                                    
in  support  of   the  bill.  He  cited   that  the  current                                                                    
retirement  system  did not  work  and  was a  challenge  to                                                                    
securing    employees    across    all    departments    and                                                                    
organizations. He  stated that the city  was expending local                                                                    
resources to  provide additional  human resources  staff and                                                                    
had  implemented  hiring  bonuses and  other  incentives  to                                                                    
attract  employees.  He  offered  a  glimpse  into  how  the                                                                    
current  Tier  4  plan appeared  unattractive  to  potential                                                                    
employees. He shared that when  he began his career the most                                                                    
important  thing to  him was  his wage  but as  he had  aged                                                                    
insurance and  retirement had become the  priority. He noted                                                                    
that the  private sector  could offer  additional incentives                                                                    
that the state should consider.                                                                                                 
2:15:54 PM                                                                                                                    
SCOTT  MACMANUS,   SUPERINTENDENT,  ALASKA   GATEWAY  SCHOOL                                                                    
DISTRICT, TOK (via teleconference),  spoke in support of the                                                                    
bill. He  thought the bill was  a good start to  repairing a                                                                    
system that had been damaged  over the previous two decades.                                                                    
He  said  that  there  were 46  teaching  positions  in  his                                                                    
district, with  a half dozen that  had yet to be  filled. He                                                                    
felt  that the  current  retirement  offerings for  teachers                                                                    
were  not  competitive when  compared  to  the rest  of  the                                                                    
nation.  He  said  that   Alaska  teachers  stayed  in-state                                                                    
because  they loved  Alaska, but  without  incentives and  a                                                                    
long-tern   retirement  solution   the   state  was   losing                                                                    
teachers.  He  spoke  of  the emotional  cost  of  losing  a                                                                    
teacher  in  a  community.   He  testified  to  the  various                                                                    
retention programs  in his district  but lamented  that they                                                                    
were not a long-term solution.  He hoped that passage of the                                                                    
legislation would  attract the best and  brightest educators                                                                    
to the state.                                                                                                                   
2:20:17 PM                                                                                                                    
ERICA    KLUDT-PAINTER,   PRINCIPAL    AND   SUPERINTENDENT,                                                                    
PETERSBURG  SCHOOL DISTRICT  (via teleconference),  spoke in                                                                    
support of  the bill. She  relayed that the  current teacher                                                                    
retirement system was failing  to recruit and retain quality                                                                    
teachers in  the state.  She asserted  that lower  wages and                                                                    
high cost  of living had  led to a  loss of teachers  in the                                                                    
state.  She  lamented  that the  current  system  failed  to                                                                    
attract teachers,  which impacted  the quality  of education                                                                    
that students  received. She urged the  committee to support                                                                    
the legislation.                                                                                                                
2:23:07 PM                                                                                                                    
Co-Chair Olson OPENED public testimony.                                                                                         
2:23:20 PM                                                                                                                    
LON  GARRISON,  EXECUTIVE  DIRECTOR, ASSOCIATION  OF  ALASKA                                                                    
SCHOOLBOARDS,  JUNEAU, testified  in favor  of the  bill. He                                                                    
relayed that  the board had  long supported a return  to the                                                                    
defined benefit  program as the  preferred option  for staff                                                                    
retirement.  He  stressed  that school  districts  faced  an                                                                    
unprecedented crisis in retaining  teachers and staff, which                                                                    
directly led  to the decline  of the  states  constitutional                                                                    
mandate  to provide  a quality  education  to every  student                                                                    
every day. He said that  school boards across the state were                                                                    
facing some  of the  most significant challenges  ever faced                                                                    
in allocating  severely dilapidated resources. He  said that                                                                    
the lack of  a defined benefit system  was another challenge                                                                    
in recruiting quality educators  and staff. He believed that                                                                    
investment  in quality  staff was  an  investment the  state                                                                    
2:25:41 PM                                                                                                                    
KIMBERLY HOMME, SELF, JUNEAU, spoke  in support of the bill.                                                                    
She  relayed that  she was  a recently  retired teacher  and                                                                    
school administrator  from the Anchorage, Kenai,  and Juneau                                                                    
school districts. She thought  that schools and service jobs                                                                    
were  struggling to  find qualified  employees and  believed                                                                    
that  a true  pension  system would  attract employees.  She                                                                    
said  that educators  wanted to  contribute to  a retirement                                                                    
system that was not reliant  solely on the stock market. She                                                                    
felt that  future Alaskans would  benefit from  a retirement                                                                    
system that allowed them to  retire at a reasonable age. She                                                                    
urged the committee to advance the legislation.                                                                                 
2:28:35 PM                                                                                                                    
SANDI RYAN, FAIRBANKS  EDUCATION ASSOCIATION, FAIRBANKS (via                                                                    
teleconference),  testified in  support of  the legislation.                                                                    
She had  been a teacher  in Alaska  for 36 years.  She noted                                                                    
that Alaska was the only  state where teachers had no access                                                                    
to Social  Security. She felt  that teachers focused  on the                                                                    
details of their  retirement plan as they  advanced in their                                                                    
careers  and could  look to  employment in  other states  to                                                                    
meet  their needs.  She stressed  that Fairbanks  was losing                                                                    
educators as fast  as they could be  recruited. She implored                                                                    
the committee to support SB 88.                                                                                                 
2:30:49 PM                                                                                                                    
DENVER  PERRY,   SELF,  NORTH  POLE   (via  teleconference),                                                                    
testified in  support of the bill.  He was a Tier  I retiree                                                                    
and recipient  of the defined  benefit pension.  He detailed                                                                    
his  career  in  and  out   of  Alaska  and  said  that  his                                                                    
retirement plan had kept him  working in the state. He urged                                                                    
the committee to pass SB 88.                                                                                                    
2:31:55 PM                                                                                                                    
DAN POLTA,  SUPERINTENDENT, DENALI BOROUGH  SCHOOL DISTRICT,                                                                    
HEALY (via  teleconference), spoke  in support of  the bill.                                                                    
He   believed  the   current  system   was  critically   and                                                                    
dangerously  flawed. He  shared that  teachers did  not earn                                                                    
Social  Security  and  the  PERS  and  TRS  system  did  not                                                                    
interact  with the  Social Security  system in  a meaningful                                                                    
way. He felt the current  system did not provide appropriate                                                                    
disability support to employees.                                                                                                
2:34:44 PM                                                                                                                    
AT EASE                                                                                                                         
2:35:08 PM                                                                                                                    
BERT  HOUGHTALING,  SELF,  BIG  LAKE  (via  teleconference),                                                                    
spoke in opposition to SB 88.  He cited that over 33 percent                                                                    
of Alaskans  were living on  welfare in one form  or another                                                                    
and believed that the bill would make the rich richer.                                                                          
2:37:07 PM                                                                                                                    
STEPHANIE  ILLICHMAN-PEARSON, FAIRBANKS  NORTH STAR  BOROUGH                                                                    
EMPLOYEE   ASSOCIATION,   FAIRBANKS  (via   teleconference),                                                                    
testified in support of the bill.  She listed a long list of                                                                    
duties  of  public   employees  including  providing  public                                                                    
transportation,  running  recreational facilities,  managing                                                                    
facilities,  providing library  services, managing  the road                                                                    
system,  solid waste  management, and  managing the  budgets                                                                    
among other duties. She  mentioned recruitment and retention                                                                    
problems in  the state. She lamented  that local governments                                                                    
were struggling with recruitment  and retention daily, which                                                                    
burned out  employees and limited services  available to the                                                                    
public. She urged the committee to pass the bill.                                                                               
2:39:07 PM                                                                                                                    
DARRELL  EVANS,   PRESIDENT,  ANCHORAGE   POLICE  DEPARTMENT                                                                    
EMPLOYEES   ASSOCIATION,  ANCHORAGE   (via  teleconference),                                                                    
spoke  in  support   of  the  bill.  He  had   been  in  law                                                                    
enforcement   for  over   28  years   and  started   in  law                                                                    
enforcement at the age of 22.  He noted that at that time he                                                                    
was not thinking  of retirement or his  financial future. He                                                                    
expressed  relief that  he had  a pension  in place  for his                                                                    
family's  future  financial  security.  He  cited  that  law                                                                    
enforcement was  facing a recruitment and  retention crisis.                                                                    
He  shared   current  vacancies  at  the   Anchorage  Police                                                                    
Department, which was  high. He believed that  the issue was                                                                    
a bipartisan  one based solely  on recruiting  and retaining                                                                    
employees in Alaska.                                                                                                            
2:42:16 PM                                                                                                                    
TRACY BALOVICH, JUNEAU EDUCATION  SUPPORT STAFF, JUNEAU (via                                                                    
teleconference), spoke  in support  of the bill.  She shared                                                                    
that she worked for the  Juneau School District and was Tier                                                                    
III.  She said  that  without a  defined  benefit plans  the                                                                    
state could not recruit and  retain employees. She said that                                                                    
not having a  solid pension in place for  employees left the                                                                    
district   understaffed   and   the   children   of   Alaska                                                                    
2:44:11 PM                                                                                                                    
COREY  AIST,  PRESIDENT,  ANCHORAGE  EDUCATION  ASSOCIATION,                                                                    
ANCHORAGE (via teleconference), testified  in support of the                                                                    
bill. He  relayed that he  was a teacher with  the Anchorage                                                                    
School  District.  He   cited  that  as  of   May  1,  2023,                                                                    
approximately 350  teachers had resigned from  the district.                                                                    
He noted that  most of those were in their  first 5 years of                                                                    
service.  He said  that there  were 3,500  educators in  the                                                                    
district in 2011, which had  dropped to below 3,000 in 3023.                                                                    
He  stressed the  importance of  attracting teachers  to the                                                                    
state and keeping them here once they arrived.                                                                                  
2:46:13 PM                                                                                                                    
Mr.  Polta  continued  his testimony  from  earlier  in  the                                                                    
public comment  period. He described the  many challenges of                                                                    
the current  system. He reiterated  the lack of  support for                                                                    
employees   living  with   a  work-related   disability.  He                                                                    
expressed concern  of the cost  to the state,  the employer,                                                                    
and the  employee. He hoped  that the state could  provide a                                                                    
program  that   provided  generously   and  was   also  cost                                                                    
2:48:55 PM                                                                                                                    
Co-Chair Olson CLOSED public testimony.                                                                                         
Co-Chair  Olson   relayed  that  amendments  would   be  due                                                                    
Thursday at 5pm.                                                                                                                
SB  88  was   HEARD  and  HELD  in   committee  for  further                                                                    

Document Name Date/Time Subjects
SB88 Testimoy Hill.pdf SFIN 5/10/2023 1:30:00 PM
SB 88