The General Assembly officially reconvened on Wednesday, May 12 to begin what is commonly called a “short session”. These sessions traditionally are limited to matters affecting the budget and to final disposition of bills that had been approved by either the Senate or the House during the preceding long session.
Legislators will be focused on revisions to the state’s biennial budget since the slow pace of the economic recovery has caused further shortfalls in state revenue collections. The General Assembly may trim as much as $800 million from the previously approved expenditures for 2010-11 and shift funds to cover mandated expenditures as well as high priority needs. The Senate is expected to move rapidly. Senate leaders have said that work will be finished on the budget revisions by the end of next week and then send this proposal to the House.
The N.C. Retired Governmental Employees’ Association has one, and only one, legislative priority in this short session. We are asking the General Assembly to fully fund the Annual Required Contribution (ARC) to the Teachers’ and State Employees’ Retirement System. This responsibility rests with the General Assembly that has never before failed to fund the required contribution in the 69-year history of the state pension system. The 2010 General Assembly now must continue this honorable tradition.
Full funding will require an additional $181 million, a large sum in any year. We need your help to convince legislators to approve this appropriation. It is easy for a highly complex and abstract issue to get lost in the crush of activity to bring the budget back into balance. Legislators need to understand that failure to fund the Annual Required Contribution will have serious consequences down the road for state retirees who live in their legislative districts.
A retirement system that is not fully funded likely will not generate undistributed investment gains in future years that could be used to pay for Cost-Of-Living Adjustments. Also, a delay in funding this obligation will mean that even larger amounts will have to be appropriated in future years. The Retirement Systems Division estimates that an additional $645 million would be needed to fully fund the Teachers’ and State Employees’ Retirement System if the General Assembly defers action until 2011-12.
Please call your legislators and ask that they support full funding of the required contribution to the state retirement system. We ask especially that you call members of the state House of Representatives because there are indications that the House is more sympathetic to our position on this issue. We believe that a polite contact from constituents, whether by phone call, e-mail, or letter, will greatly help our efforts here in Raleigh. Thanks for your assistance.
GENERAL ASSEMBLY CONVENES FOR SHORT SESSION