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