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