Legislative Report

Report 08-10
July 11, 2008

Budget Adopted, Awaits Governor’s Signature

The House and Senate gave final approval to the conference committee report on the revised budget for 2008-09 on Tuesday, July 8. The ratified budget bill (HB 2436) was sent to the Governor for his signature. As of this morning, Governor Easley had not yet signed the budget.

There were no changes in the final budget that affected retirement benefits that had been approved in earlier versions by the Senate and the House. A 2.2% Cost-Of-Living Adjustment was included for retired teachers, state employees, members of the state judicial system, and legislators. The COLA required a supplemental appropriation of $41 million to the Teachers and State Employees Retirement System.

Local government retirees will receive a 2.17% COLA previously approved by the Retirement Systems Board of Trustees. This COLA did not require approval by the General Assembly since no additional funding was required of local government employers.

The ratified budget also includes an increase in the monthly payment to retired members of the Firemen’s and Rescue Squad Workers’ Pension Fund. The monthly pension payment was increased from $167 to $170 effective July 1, 2008.

Payment of COLAs

All of the COLAs mentioned above became effective on July 1. The COLA for retired local government employees will be included in the July 25 pension payments. However, the COLAs for the state retiree groups may be delayed until August if the budget is not signed by the Governor before Monday, July 14. If the COLAs are delayed until August, the August payments will include a retroactive payment for the delayed July COLA.

State Health Plan: House Bill 2443

The Senate approved HB 2443 this week with one amendment. The bill generally is a technical rewrite of the state statutes governing the State Health Plan. The revisions reflect the transition from a single indemnity heath plan to the three PPOs that now are available to all Plan members.

The bill also authorizes the Executive Administrator of the Plan to develop and offer a Medicare Advantage option to eligible Plan members. The Administrator must consult with the legislative Committee on Employee Hospital and Medical Benefits prior to implementing this option.

The Senate amendment modified the procedures for hiring and firing of the State Health Plan Executive Administrator. The Senate amendment establishes a 3-member State Health Plan Administrative Commission. Two members would be appointed by the House and one by the Senate. None of the members may be members of the General Assembly.

The bill has been sent to the House. A vote on concurrence is scheduled on Monday.