SENATE BILL NO. 55 "An Act relating to employer contributions in the teachers' retirement system; relating to supplemental employee benefits; and providing for an effective date." 10:19:18 AM Co-Chair Hoffman relayed that SB 55 was previously heard on April 8. The committee would hear public testimony. 10:20:03 AM ROSE FOLEY, STAFF, SENATOR BERT STEDMAN, explained that SB 55 was an attempt to create a more equitable retirement system for the two retirement systems of the state, PERS and TRS. The bill would allow for those under the TRS plan to join SBS or Social Security. Co-Chair Bert Stedman, Sponsor, commented that the bill recognized that teachers were not in Social Security or SBS, which left their retirement lacking. He considered the retirement system for the teacher sonly invested 15 percent of their salary. He thought it was clearly recognized that cities that did not include Social Security or SBS left their employees short. 10:24:16 AM Co-Chair Hoffman OPENED public testimony. 10:24:33 AM NILS ANDREASSEN, EXECUTIVE DIRECTOR, ALASKA MUNICIPAL LEAGUE, testified in support of the bill. He said that PERS and TRS had been devalued over time. He noted the current defined contribution cost of 4.2 percent, which was much lower that the percentage prior to 1986. The plan prior to 1986 offered a great incentive as a valid replacement of Social Security, but this was no longer the case. He urged maximizing choice for employees. He noted that there were 100 local governments that did not participate in PERS that did not face the liability issues faced by the state. 10:29:22 AM Mr. Andreassen stressed the concern for public sector employees who were planning for retirement. He wondered whether SBS diminished the incentive to increase payroll at a higher rate. He related that ultimately, this is a compensation package selection that is up to employers, who faced with SB 55's increased contribution requirements of between $19 and $42 million would likely have to find trade - offs in what else they currently offer. This is the exact conversation that Congress had in 2021, when evaluating whether to force all state and local governments into Social Security, irrespective of their own alternatives, such as SBS. 10:31:19 AM HEATHER ARANA, DIRECTOR OF BENEFITS AND COMPENSATION, UNIVERSITY OF ALASKA FAIRBANKS (via teleconference), testified in support of the bill. 10:33:28 AM Co-Chair Stedman agreed that the University should be carved out of the bill. He added that he believed that the Universitys retirement plan was weak. He believed, given current budgetary constraints, cost of the bill would need to be phased in. He expressed concern for employees in the state without a reasonable retirement plan. 10:35:24 AM Co-Chair Hoffman CLOSED public testimony. SB 55 was HEARD and HELD in committee for further consideration.