Legislative Report

Report 09-26
July 24, 2009

SPONSOR REQUESTS BILL CONSIDERATION

On Tuesday of this week, Rep. Russell Tucker requested that the House Appropriations Committee schedule consideration of his bill (House Bill 934) that would authorize a one percent (1.0%) Cost-Of-Living Adjustment for retired local government employees. Rep Tucker sent the request to Rep. Michaux who serves as Senior Chairman of the House Appropriations Committee. House Bill 934 authorizes the Board of Trustees of the Local Governmental Employees’ Retirement System to approve a COLA not to exceed 1.0%.

Act Now !

At this point, we do not know if or when the Committee will consider HB 934. However, this would be a good time to call your House members if you have not already talked to them about HB 934. Ask them to contact the co-chairs of the House Appropriations Committee to request that House Bill 934 be scheduled for consideration. Also, ask your representatives to support passage of the bill.

Passage of HB 934 does not require any state funding. The local COLA has the support of the Retirement System Board of Trustees, our Association, the League of Municipalities, and the Association of County Commissioners.

Local government retirees will receive a small increase in the July pension payment. This reflects the one-tenth of one percent increase that was approved by the Board of Trustees on July 16th in accordance with a new interpretation of the state statute governing COLAs. According to this recent informal ruling by the Attorney General’s staff, the Board cannot grant a COLA that is higher or lower than the rise in the Consumer Price Index for the most recent year. However, the General Assembly has the power to authorize a higher COLA.

BUDGET NEGOTIATIONS HIT SNAG

House and Senate conferees have been working on a state budget compromise and announced earlier this week that they had reached agreement on the revenue components of the biennial state budget. The agreement would provide an additional $980 million for the budget by raising a variety of taxes. Most of the new revenue would be generated by a temporary 1% state sales tax increase and a 2% surcharge on state income taxpayers who owe taxes at the end of the year.

However, on Thursday, Governor Perdue informed the General assembly that the revenue proposal was not acceptable. The Governor was especially concerned about the proposed 2% income tax surcharge. It is unclear as to whether the general Assembly will try to modify the current proposal or start from scratch on a completely new revenue package. In either case, the completion of the budget will delayed until August.

The House and Senate approved the final conference report on Senate Bill 658. This bill designates one of the six seats on the Supplemental Retirement Board of Trustees That are appointed by the Governor to be filled by a retired state or local government employee. The bill has been sent to the Governor for her signature.