Legislative Report #07-23

Report 07-23
June 29, 2007

CONTINUING RESOLUTION ADOPTED

The General Assembly approved House Bill 2044 this week. The bill provides for continuing operations of state government until August 1, 2007 since the conferees on the state budget for the 2007-08 biennium have not yet reached agreement. The key points of contention appear to be the extension of temporary state taxes and Medicaid relief for county governments.

It is likely that Cost-Of-Living Adjustments for retired state employees and teachers will be delayed until the August pension payments if the conferees are unable to finalize the budget by July 15. However, the COLA increase for state retirees would be retroactive to July 1. The 2.2% COLA for retired local governmental employees should not be affected by the budget delay. The increase should be included in local retiree pension payments that will be made on July 25.

Once again, we urge retired teachers and state employees to keep in contact with members of the House and Senate. Please ask your legislators to press for a COLA higher than the 2.0% that is currently included in House and Senate budget proposals. Moving the state COLA to 3.0% would require an additional $29 million. However, state revenue collections have improved substantially since the budget process began.

COMMITTEE ACTIONS THIS WEEK

Senate committees approved several bills of interest to retirees this week. A summary of committee actions on these bills is presented below.

Senate Education Committee

The committee gave a favorable report to an amended version of House Bill 956: Retired Teachers Work. This bill extends the law allowing retired public school teachers to return to work at full salary without loss of pension benefits to June 30, 2009. However, the Senate included an amendment requiring that teachers who retire on or after July 1, 2007 must be at least age 60 and have at least 25 years of creditable service in order to return to work with no earnings restrictions. The bill is scheduled for consideration by the Senate on July 3.

Senate Committee on Pensions, Retirement and Aging

The committee approved two bills of interest on July 28. These are summarized below.

House Bill 1025: Local Government Retirement/Purchase of Service

This bill would authorize local government employers to amortize the retirement system cost of covering periods of probationary employment over a 10-year period if the employer has met the accrued liability contribution. The bill has been placed on the Senate calendar for consideration on July 3.

House Bill 676: Increase Register of Deeds’ Pension