Legislative Report #07-24

Report 07-24
July 6, 2007

BUDGET NEGOTIATORS SETTLE ON COLAS

Efforts to finalize the state budget moved ahead this week as budget conferees announced tentative agreement on employee pay increases and retiree COLAs. Senator Kay Hagan indicated on Thursday that the budget conferees had given tentative approval to a 2.2% COLA for retired teachers and state employees. This is the same percentage as the COLA that has been approved for local government retirees. Active teachers would receive a 5% increase and active state employees would get a 4% raise under the tentative agreement.

Senator Hagan also pointed out that these figures still were subject to change. A number of important issues remain to be resolved before the budget is approved. However, we welcome the upward movement in the state retiree COLA from the original 2.0% to 2.2%.

Earlier in the week, Representative Maggie Jeffus made the first public effort to increase the retiree COLA. In an open meeting of House and Senate budget leaders, she urged an increase in the COLA given the fact that more state revenues were available than originally projected. We thank both Sen. Hagan and Rep. Jeffus for their efforts.

BILL APPROVALS THIS WEEK

The Senate passed two bills of interest this week. These bills have been covered in earlier editions of our Legislative Report and are summarized below.

House Bill 676: Increase Register of Deeds’ Pension

This bill increases the maximum monthly benefit from $1,200 to $1,500, not to exceed 75% of final annual salary plus supplements prior to retirement. Also, the bill provides that retiring registers of deeds become eligible for the monthly pension in the month immediately following the date of retirement.

The bill was approved on second and third readings. It will be returned to the House for concurrence.

House Bill 956: Retired Teachers Work

This bill extends the law allowing retired public school teachers to return to work after a 6-month separation from service at full salary without loss of retirement benefits to June 30, 2009. The Senate amended the bill to require that teachers who retire 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 without earnings restrictions. Teachers retiring after July 1, 2007 who do not meet the age and years of service thresholds may be re-employed on a part-time basis under the 50% earnings cap.

The Senate approved HB 956 on second and third readings. It will be returned to the House for concurrence in the Senate amendments.