Legislative Report #07-25

Report 07-25
July 13, 2007

MOVING TOWARD ADJOURNMENT?

House and Senate budget conferees continued to meet through the week with legislative leaders expressing hope that a final conference report would be ready by next Monday. This would set the stage for budget adoption by the end of next week and adjournment possibly by the end of July.

The work of the budget conference committee this week included discussion of State Health Plan changes. The conferees reached tentative agreement on a provision to replace the existing Indemnity Plan with an alternative benefit plan by July 1, 2008. Our Association has urged the General Assembly throughout this session to proceed cautiously with this transition. Specifically, we asked that the following concerns be addressed:

1. the new plan must be provided to active and retired state employees on a non-contributory basis (no premiums),
2. the benefits of the new plan must be equal to or better than the benefits provided by the current indemnity plan,
3. the network of medical providers must assure ready access by members in North Carolina and other states,
4. the transition must allow sufficient time and resources to counsel members on the benefits of the new plan.
5. There must be review and oversight by the General Assembly before the new plan is implemented.

It appears that all of these points have been addressed in the plan tentatively approved by the conferees.

THANK YOU!

The decision reached last week by the budget conferees to increase the COLA for state retirees from the original 2.0% to 2.2% is expected to be included in the final budget conference report. We thank all of our members who contacted members of the General Assembly to urge a higher COLA. Although the increase is small, the budget conferees did change the rules to raise the COLA. As a general rule, budget conferees cannot change budget items where the House and Senate are in agreement. Your communications with legislators made the difference.

We ask that you express your thanks to members of the House and Senate. They need to know that we appreciate their response to our request.

OTHER BILL ACTIVITY

Senate Bill 720: Open Enrollment/Contributory Death Benefit
The House Pensions and Retirement Committee approved a committee substitute for SB 720 on Wednesday. This bill as amended by the committee establishes a four-month open enrollment period (Feb.1 - May 31,2008) during which retired state and local government employees could enroll in the contributory death benefit plan. The monthly premiums charged to new enrollees would be based on age at the time of enrollment. The bill requires the Retirement Systems Division to send 2 notifications to all eligible retirees during the enrollment period. Senate bill has been placed on the House calendar for second and third reading on July 18.

House Bill 956: Retired Teachers Work