The House Appropriations Committee and Finance Committee worked this week to present a Committee Substitute for Senate Bill 202 ( the Appropriations Act of 2009). The bill now includes both the biennial budget and a $780 million revenue package. The modified bill came to the House floor on Thursday.
Funding For the State Retirement System
The bill represents both good news and bad news for retirees. The House has included $29 million for 2009-10 and $359 million for 2010-11 to restore the appropriate level of employer funding for the Teachers’ and State Employees’ Retirement System (TSERS). The bill also provides an additional $1.3 million in each year for the Consolidated Judicial Retirement System (CJRS). These appropriations are intended to bring TSERS and CJRS back to “break even” status but will not immediately generate gains to pay COLAs.
The Senate did not include second year funding for the TSERS or CJRS in the Senate version of the Appropriations Act. This issue will be resolved by a joint conference committee that will be appointed when the House finishes work on the budget bill.
COLA For Local Retirees
The House did not incorporate a provision in the budget bill authorizing a 1.0% COLA for local government retirees as we had requested. This does not mean that there will not a COLA for local retirees. House Bill 934 which authorizes a 1.0% local COLA remains in the House Appropriations Committee and still is eligible for consideration. We will evaluate our next steps on this issue and provide an update in the next edition of this Legislative Report.
Other House Budget Provisions
The additional revenues produced by the tax package allowed the House to restore some of the budget reductions previously approved by Appropriations subcommittees. These restorations included $317,863 for the Firefighters and Rescue Squad Workers’ Pension Fund. The Appropriations Subcommittee on General Government initially had recommended that this sum be withheld from the Pension Fund.
The National Guard Pension Fund is transferred to the Department of State Treasurer. This fund currently is managed by the Department of Crime Control and Public Safety.
HOUSE BUDGET: GOOD NEWS / BAD NEWS