Pension Threat Level Map

Alabama:
The 2010 Legislative session began on Tuesday, January 12, 2010, and ended on April 22nd.

Alaska:
The legislative session began on January 19 and ended on April 18, 2010 without passage of legislation to return to the DB system.

On March 29, 2010, the Alaska Public Pension Coalition participated in a public meeting in Juneau to discuss the status of HB 30 and SB 23, Return to the Defined Benefit Pension System. The bill sponsors and co-sponsors of HB 30 and SB23 were invited to attend and participate by sharing their perspectives on the importance of passing this legislation. Senate Finance Committee co-chair, Bert Stedman, and House Labor and Commerce Committee co-chair, Kurt Olson, continued to resist moving these bills out of committee throughout the legislative session.

Public employees in this state have received support from the National Public Pension Coalition.

Arizona:
HB 2389 affects new hires after July 1, 2011. The law modifies the average monthly compensation used to calculate benefits from the 3 highest consecutive years to the highest consecutive 60 months in the last 120 months. It changes normal retirement eligibility to a Rule of 85 age plus years of service, up from 80. Early retirement also has a 3% decrease in benefits for each point or fraction of a point less than 85, but equal to or greater than 82. The Governor signed the bill on April 14th.

The 2010 Legislative session began on January 11, 2010, and ended on April 29th.

The two largest public pension systems in Arizona will require higher contributions from employees and employers. State and local government workers who belong to the Arizona State Retirement System will see their contribution rates increase from 9.4 percent to 9.6 percent on July 1, 2010. The director of the Arizona State Retirement System, Paul Matson, predicts that employees will not see any permanent benefit increases for another five years. Contribution rates are determined using actuarial data through June 30, 2009. It is expected that contribution rates for the 2011-12 fiscal year, which begins July 1, 2011, will increase by an amount similar to the increase effective July 1, 2010.

Arkansas:
The 2010 fiscal session began on February 8, 2010, and ended on March 4, 2010.

California:
May: CalPERS on May 18th was preparing to approve a plan to require $700 million more from the state and local school districts in the form of higher contribution rates. However, on May 19th, CalPERS backed down from the proposal, delaying a vote on it until June.

The regular legislative session convened on January 12, 2010 and adjourns on August 31, 2010.

The Governor and mayor of Los Angeles both made public statements on April 21st supporting a plan to give newly hired state employees less generous retirement packages. The Governor is supporting legislation introduced by Senate Republican Leader Dennis Hollingsworth to increase the retirement age of new employees while also decreasing their benefits. The age for most public employees would be raised to 65 years old from current 62 years old. Public safety public employees would be raised to 57 years old from 50 years old. Public Safety pensions would receive 2.7 percent of their single highest year, as opposed to the current 3 percent. The legislation is SB 919.

Meg Whitman, Republican candidate for Governor, wrote a letter to the editor, which was published in the Orange County Register in which she supported moving new state employees into a Defined Contribution system, “new state workers should receive a 401(k)-style defined contribution plan.” Democratic candidate Jerry Brown for Governor has said that he would consider public employee pension reform, but that he opposes any move to a Defined Contribution system.

Assemblyman Hernandez has introduced legislation, AB 1987, which would limit a worker’s final compensation to the average increase of other employees in the same or related work group. The legislation is intended to combat spiking practices. The bill would require retirees to wait at least six months before working for any other public entity.

Governor Schwarzenegger has proposed ending furloughs for state workers at the end of June, and replacing these with permanent pay cuts and higher employee pension contributions. These two measures would add up to a 10 percent cut in gross pay. The proposal is included in the Governor’s budget.

Colorado:
The legislative session began on January 13, 2010 and ended on May 12, 2010.

Governor Ritter signed SB 1 into law on February 23rd. SB 1 increases employer and employee contributions to PERA by 2 percent as well as reduces cost-of-living increases for current retirees and caps them at 2 percent, down from 3%. SB 1 also increases the retirement age to 60 from 55.

Public employees in Colorado have received support from the National Public Pension Coalition, including grant support.

Connecticut:
The legislative session ended on May 5th.

Governor Rell announced on April 20th plans for another early retirement program. The Governor and state employee unions failed to reach an agreement on an early retirement plan.
Lt. Gov. Michael Fedele, who is seeking the Republican nomination for Governor, has proposed capping pension benefits for current state workers, and eliminating bonus pay from calculating pension benefits. He also called for new hires to be put in a Defined Contribution system. Republican Governor Candidate Griebel has said he plans to investigate whether the state can transfer new state workers from the Defined Benefit to a Defined Contribution plan.

Governor Rell created a Post-Employment Benefits Commission, which will recommend short and long-term strategies for addressing the states pension and OPEB liabilities. The Commission is expected to issue a report on, or before July 1, 2010 that: identifies the amount and extent of unfunded liabilities for pensions and other post-employment benefits; compares and evaluates the advantages and disadvantages of various approaches for addressing unfunded pension liabilities and post-employment benefits; and proposes a short and long term plan or plans for addressing unfunded pension liabilities and post-employment benefits.
28 of the state’s 169 municipalities have some version of a Defined Contribution plan. As more localities move toward Defined Contribution plans, pressure is growing for state government to do the same.

Delaware:
May: The regular legislative session will end on June 30th.

There is discussion in the Delaware legislature to increase state employee contributions to pension funds.

HB 101 would allow for an alternative method of calculating a retiree’s final average compensation that does not result in a loss of pension benefits from salary and wage reductions.

Florida:
The regular legislative session ended on April 30th.

A budget framework was worked out on April 26th that spared public employees from an increase in employee contribution rates to the retirement system. The budget language did cut the interest earned on accumulated DROP benefits from 6.5 to 3 percent.

Several proposals were offered during the legislative session that would make significant changes to the retirement system, including efforts to move new city employees to DC accounts, to increase current employee contribution rates, limit compensation used to calculate benefits and calculate benefits based on career averaging rather than a set number of years.

Georgia:
May: The Governor signed HB 1055 into law on May 12th. This bill eliminates taxes on retirement income for state residents over the age of 65. The taxes will be phased out over five years starting in 2012. The tax cut will cost the state $150 million annually.

HB 916 establishes that if an employee retires before reaching normal age for retirement, and then tries to return to work, they no longer are allowed to receive pension benefits. The bill was sent to the Governor on May 3rd. HB 969 would establish that retired teachers who have reached normal retirement age and return to work have two options. They can either contribute to the pension system, ceasing benefits, but gaining more creditable service; or they can choose to not contribute to the system, and they can continue receiving benefits, but they cannot accrue extra creditable service. This bill was also sent to the Governor on May 3rd.

The legislative session ended on April 29, 2010.

The Lt. Governor Casey Cagle’s budget task force released its recommendations for the state to save money, including recommended increases of teacher contributions to the retirement system and shifting new teachers to a Defined Contribution system.

Hawaii:
The legislative session ended on April 30th.

During the session Governor Lingle called on the legislature to find ways to curb pension spending. During the session the legislature failed to act on HB 1715, 2009 carried over legislation, which would have increased years of service requirements and imposed higher minimum retirement age for new hires.

Idaho:
The legislative session ended March 29th.

During the session the legislature considered adjusting the COLA. The House voted against giving Idaho employees a COLA increase, but the Senate failed to make a move on the issue. Thus, Idaho public employees received a 1 percent COLA increase in March.

Illinois:
May: The legislative session ended on May 7th, but not before the Senate passed budget allowed the state to delay paying its actuarially recommended $3.7 billion state contribution (due on June 30) until January 2011.

HB 5873 did not pass, however the bill will come back up either when the legislature returns for a special budget session in September, or during the fall veto session. The bill would have required new police and firefighters to work till the age of 55 before they could retire an increase of 5 years of service. The bill would also allow local governments to reset their pension payment calendars allowing payments to the pension system to be pushed into the future. Also included in the bill is a provision that limits new police and firefighter pension benefits to 72 percent of the average of the highest four years of pay in the final decade of employment, COLAs would be capped at 3 percent. Finally, the bill would begin an 18-month state study of local pension systems.

Governor Quinn signed SB 1946 on April 14th. The legislation limits to $106,800 the salary that is applied to future public employee’s pension. The bill also increases the retirement age to 67 years old, with 10 years of service for future public workers. The legislation also bans public employees from getting a pension from one government employer while collecting a salary from another.

During the regular session, State Senator Bill Brady, who is running as the Republican nominee for Governor, proposed moving all new hires into a Defined Contribution system and allowing current employees the option to switch from their Defined Benefit system to a Defined Contribution system. In January the state borrowed $3.47 billion by selling municipal bonds, the proceeds of the bond were targeted to pay required pension contributions for the fiscal year ending on June 30, 2010.

Indiana:
The legislative session ended on March 14, 2010.

Bills considered during the session would have allowed certain members of the Public Employees’ Retirement Fund (PERF) and the Indiana Teachers’ Retirement Fund (TRF) to withdraw their annuity savings account if the member has separated employment and is not employed in a covered position for 30 days (a reduction of the current 90 days) and would have allowed members of PERF and TRF to petition the board of trustees of their respective fund to correct an error in a determination of either the member’s creditable service or benefit, up to six years after the determination. SB 0030, the bill to allow employees to withdraw their annuity savings account after only 30 days of being separated from their employment, was signed into law on February 23rd.

Iowa:
The legislative session ended on March 30, 2010.

On April 23rd, Governor Culver signed HF 2518 into law. The bill phases out the state’s contributions to the Municipal Fire and Police Officer Retirement System, forcing cities to pick up more of the costs. The bill also increases the IPERS vesting requirement from four years to seven years, calculates retirement benefits using a member’s high five years of salary rather than three, and increases the early retirement penalty from 3 percent to 6 percent. The provisions are effective July 1, 2012. The bill also increases IPERS total contributions to 13.45 percent in 2011.

On February 10th, Governor Culver signed into law SF 2062, which created an early retirement incentive plan for state employees who retired by May 28th, 2010. These employees will receive up to $25,000 in incentive pay, up to five years of health insurance and cash for unused vacation time.

Kansas:
Legislative session ended on April 6th.

During the session Senate President Steve Morris introduced legislation that would increase state and public employee contributions to the Kansas Public Employees Retirement System. The legislation also included a slight increase in the multiplier that determines pension benefits. The bill did not pass.

Public employees in Kansas have received support from the National Public Pension Coalition, including grant support.

Kentucky:
May: The legislative session ended on March 29th. However, the Governor has called the legislature into a special session beginning May 24th to pass a budget.

On April 26, 2010 the Governor signed HB 531, which authorizes the state to borrow up to $816 million through bonds to repay money shifted from the teachers’ pension fund to cover retirees’ health insurance costs.

Public employees in Kentucky have received support from the National Public Pension Coalition.

Louisiana:
May: HB 1337 was proposed on May 13th before a House Committee hearing. The bill would base benefits on the average compensation of the last 5 years of employment. Also being proposed on May 13th are HB 930 and 931, which would create a Defined Contribution system for new employees. The House Retirement Committee advanced HB 1337, which would require new teachers to reach the age of 60 to retire, and calculate new teacher benefits based on the last 5 years of employment.

The legislative session began on March 29, 2010 and will adjourn on June 21, 2010.

Cities’ contribution rates to the Louisiana Municipal Police Employees’ Retirement System will increase on July 1, 2010 to 25 percent, from the current 11 percent. Employee contribution rates will remain at 7.5 percent. Also on July 1, 2010 cities’ contributions to the Firefighters’ Retirement System of Louisiana is increasing from 14 percent to 21.5 percent, while again the employee contribution rate of 8 percent is not changing.

The Commission on Streamlining Government wants the Louisiana Legislature to make all new hires after July 1, 2010 go into a Defined Contribution system. However, the proposal faces resistance from the Retirement Systems themselves. On October 19th, 2009 state lawmakers began studying the possibility of changing the state's public retirement system to a Defined Contribution system. A meeting of the state House and Senate Retirement committees started looking at defined contribution plans for new state employees. The House Speaker, Jim Tucker, has put forward the proposal to the committee to move new state employees into a Defined Contribution system.

Maine:
The legislative session ended on April 12th without changes.

The Unified Retirement Task Force issued its report on March 8, 2010. The report supports continuation of defined benefit plans for public employees.

Maryland:
The legislature adjourned on April 12th.

Governor O’Malley signed a bill into law on April 14th that will take the negative cost of living that would have occurred in fiscal year 2011 and deduct it from the expected positive COLA in 2012.

The House and Senate conference committee released a compromise budget on April 8th. The conference budget leaves out a shift of teacher pension costs from the state to counties; a shift, which was in the budget passed by the Senate. The budget does set up an independent commission to study Maryland’s rising public employee pension costs. The commission would be charged with drafting a comprehensive cost-sharing plan with local governments by the end of this year.

Massachusetts:
May: The full Senate passed the bill with the pension reforms on May 13th. The Senate and House bills must now be compromised into one bill.

The Senate budget committee added pension system reforms to legislation aimed at municipal government, pension related provisions include a $125,000 cap on pensions. The bill would also eliminate termination retirement allowances for new state hires. The bill also limits the annual increases on retirement earnings to 7 percent plus inflation as an effort to fight spiking. The bill has the provisions in the House passed bill that would allow localities to wait until 2040 to fully fund their pensions and allows localities to set up early retirement programs.

The House of Representatives passed a bill that would give cities and towns until 2040 to fully fund their pension programs. The bill also allows cities and towns to set up early retirement incentive programs, as well as allowing cities and towns to increase the amount of money eligible for COLA.

Charles Baker, the Republican gubernatorial candidate, has proposed a plan to ban the practice of “double dipping”. His proposal is to calculate the average salary over the entire career of a state worker, instead of using their top three years of earnings. It would require workers to work for 10 years in a state job that boasts enhanced retirement before they could receive an enhanced pension. Finally, his proposal would cap benefits at $90,000.

The legislative session began on January 6th, and it runs throughout the year.

Michigan:
May: The legislative session will end on July 1st.

The legislature passed a retirement incentive bill on May 14th. The bill will boost monthly pension benefits for teachers and other state employees who retire between July 1st and September 1, 2010. School employees age 55 and over and at least 30 years of service can calculate their benefits with a 1.6 percent multiplier, instead of the current 1.5 percent. Those who do not retire would pay an additional 3 percent to retiree health care, as well as all school employees starting October 1st. New hires could pay up to 11.4 percent toward a hybrid DB/DC retirement system. New hires could not retire until they reach the age of 60. Finally, school retirees who are rehired could not draw on their pension benefits. The Governor signed the bills, which are SB 1227 and HB 4073, on May 19th.

A group of school administrators made a recommendation in January 2010 to legislators to move new school employees into Defined Contribution systems, which some members of the legislature supported. Additional bills before the legislature would (HB 4527) create a Defined
Contribution system for new public school employees and HR 5570 would ban the inclusion of overtime pay in calculating pension benefits.

Minnesota:
May: The Minnesota Legislature passed an omnibus pension bill on May 12th and the Governor signed the bill on May 15. The bill eliminates the 2.5 percent COLA annual increase in teacher benefits for 2011 and 2012. Teacher COLAs are capped at 2 percent a year until the system is 90 percent funded. It also contains contribution increases for the Public Employee Retirement Association (PERA).

The legislative session will end on June 30th.

Mississippi:
The session ended on May 3rd.

SB 3078 increases the service requirement for normal retirement in the Public Employee Retirement System from 30 to 33 years for new hires, hired after July 1, 2011. The Governor signed the bill on May 17th.

The House voted on April 22nd and the Senate passed the bill on April 23rd to increase employee contributions from current 7.25 percent to 9 percent, a 1.75 percent increase. Employee contribution rates will be reviewed during the 2012 session. The Governor has signed the legislation.

Missouri:
The legislative session ended on May 14th, with SB 714 stalled in the House. However the veto session begins on September 15th.

The Missouri Senate approved SB 714 on April 20th. The bill would affect new employees in the MSERS and Highway Patrol and Department of Transportation retirement systems hired in 2011 by requiring them to retire later and make contribution into the systems. New employees would have to pay 4 percent of their pay into the retirement system. Furthermore, the bill would require new hires to reach the age of 67 and have 10 years of service in order to receive full benefits, up from the current 62 years old and 5 years of service. New workers may also retire if their age and years of service add up to 90, but the worker would need to be at least 55 years old; this is increased from the current Rule of 80, with at least 48 years old. The bill now goes to the House.

The Senate Veterans’ Affairs, Pensions and Urban Affairs Committee voted 6-0 to send a proposal to the Senate floor (SB 896) that would move new hires (hired after January 1, 2011) covered by the Missouri State Employees’ Retirement System and the Missouri Department of Transportation and Highway Patrol Employees’ Retirement System into a Defined Contribution system.

Teachers in the Public School Retirement System of Missouri have higher contribution rates this year, 2010, to their retirement plans. Teachers will have to begin contributing 14 percent of their salaries, up from 13.5 percent. Each school district will also see their contribution rates increase from 13.5 percent to 14 percent of their payroll.

Montana:
The next Regular Session begins January 3, 2011.

There is a legislative committee looking into the state retirement systems’ unfunded liabilities. A report from the Interim Committee is expected before the start of the legislative session. The committee is studying a variety of plan design changes including: raising the retirement age and years of service requirements necessary to receive a full benefits, changing the benefit formula to calculate the highest average compensation for future employees to more than 15 consecutive years of work, instead of the current 3 highest consecutive years, altering the cost of living increase from a flat rate to a rate that fluctuates based on investment returns, increasing the state’s contribution rate, and creating a hybrid DB and DC retirement plan for teachers as recommended by the TRS.

Public employees in Montana have received support from the National Public Pension Coalition.

Nebraska:
The Regular Session began on January 6, 2010 and adjourned on April 14, 2010.

Nevada:
All three Republican candidates for Governor, current Gov. Jim Gibbons, Brian Sandoval, and Mike Montandon, have said that they support moving public employees into a Defined Contribution system.

The next Regular Session of the Nevada Legislature begins on February 7, 2011.

Public employees in Nevada have received support from the National Public Pension Coalition.

New Hampshire:
April: The next Regular Session begins on January 6, 2010 and is scheduled to adjourn on July 1, 2010.

A new law is set to go into effect on July 1, 2010 will charge local governments an upfront cost of up to $600,000 per employee whenever they pay out a large amount of benefits in the final years before retirement. A study committee has been set up to examine the surcharge.

The House Finance Committee recommended $47.1 million in general fund budget cuts. The proposed cuts include the state decreasing its contribution to the retirement system to 20 percent in 2011. Employees would then see their contribution rates increase by 2 percent.

HB 1576 would give all public employees the option of joining a public retirement system or not. The bill would also prevent state employees who retire and then return to work from continuing to receive retirement benefits. HB 1530 would limit compensation used to calculate pension benefits to the full base rate of compensation paid during a year, taking out all other spiking methods.

Public employees in New Hampshire have received support from the National Public Pension Coalition.

New Jersey:
May: Governor Christie proposed on May 10, 2010 a permanent 2.5 percent cap on annual increases of employee contracts for public workers, police, firefighters, and teachers. Christie plans on directing top administration officials to review raising the retirement age from 62 to 65, increasing employer contributions, moving new employees into a new pension system potentially a Defined Contribution plan, and cutting COLAs.

The legislative session ends on June 28th. Governor Christie’s fiscal 2011 budget includes cutting public pension spending by $3 billion.

On March 22nd, Governor Christie signed pension reform bills into law. The bills did not include a provision that let full-time workers with fewer than 10 years on the job switch to a Defined Contribution plan. These bills require all current public employees to contribute at least 1.5 percent of their annual salaries toward health benefits and require that future retirees pay 1.5 percent of their base pension to their health benefits. The bills also repeal a 9 percent increase in benefits put in place in 2001 and require benefits be calculated based on the highest 5 years of salary for new employees. Part-time workers are banned from participating in the pension system. Finally, the bills cap unused sick leave that can be used to calculate a pension to $15,000 for all public employees.

New Mexico:
The legislative regular session ended on February 18th. The special session of the legislature ended on March 4th.

On March 2nd, Governor Richardson signed SB 207 into law. This new law will prevent government retirees from earning both a pension and a government paycheck. Those who retire after July 1, 2010 must have a 12 months break following retirement before returning to government work. Retirees who return to work for a public employer however, must contribute to the state’s retirement funds. The state also enacted a bill that requires the Educational Retirement Board to disclose the pension amounts for all its members. The Governor signed the bill on March 8th.

Public employees in New Mexico have received support from the National Public Pension Coalition.

New York:
May: The Legislature passed a budget bill that would allow the Governor to furlough 100,000 state employees for one day. However, a federal judge halted the furlough plan on May 13th.

On April 15th, Governor Paterson signed a bill into law that provides an incentive for teachers to retire early. The bill lowers the years of service requirement for those who are 55 years old to 25 years of service, instead of 30 years of service. The lowered years of service will begin June 1, 2010 and will remain at the lower rate for 90 days, after which it will return to the higher number of years. The Governor also said that he is considering a similar retirement incentive plan for other state employees.

North Carolina:
May: State Treasurer Janet Cowell has set up a commission to look at retirement benefits for future North Carolina public employees. The commission includes legislators, state Budget Director Charles Perusse, human resource employees, union members, and policy analysts. Some members of the commission already favor moving new employees into a Defined Contribution system.

The Regular Session will not convene until May 12, 2010. May 26th is the deadline to file a bill in the House or Senate that pertains to local or state pension systems. The session will end in mid-July.

North Dakota:
May: A few state Democrats are asking the Governor to order a state audit of the Retirement and Investment Office.

Representative Wald has proposed before the interim Employee Benefits Committee a bill, which would move new public employees, and new teachers, into a Defined Contribution system. The legislative committee is reviewing potential pension reforms and will report its findings to the full legislature in the 2011 session.

The Teachers’ Fund For Retirement (TFFR) board is considering a number of proposals to deal with the underfunded Teachers’ Retirement system. The proposals include asking legislators to for a one-time increase in funding, cutting benefits, increasing employee and employer contribution rates, and raising the teacher retirement age.

Ohio:
The Regular Session will begin on January 12, 2010. The legislative session ended on May 11th, but the legislature can return in June if needed. Pension legislation is expected during either the lame duck this fall or early in the 2011 session.

Public employees in Ohio have received support from the National Public Pension Coalition.

Oklahoma:
March: State Legislators, lead by Representative Sally Kern, are concerned with a provision which allows retired teachers or teachers who take a leave of absence to work for a union or association to continue earning service credits in the TRS. Kern had introduced HB 3108 to disallow this practice, but then withdrew her bill. She says she will introduce the bill again in the next legislative session.

The Legislative Session will end on May 28th.

Oregon:
Local governments are getting worried about, and preparing for, huge contribution rate increases scheduled for July 1, 2011 to the Oregon PERS. The legislature over rode a veto of SB 897, a bill which shields State employees from math errors that otherwise could have forced them to repay retirement benefit overpayments.

There is no 2010 Regular Session, but the Interim Committees began work on January 12, 2010.
The Oregon Public Employees’ Retirement System actuaries estimate that on average employers’ contributions to their employees’ defined benefit pension plans will increase by 8.4 percent starting on July 1, 2011. Actuaries say that this increase in employer contributions is necessary whether there is an economic recovery or not.

Pennsylvania:
April: The Pennsylvania State Employees’ Retirement System approved on April 28th the composite employer contribution rate to increase to 5.64 percent for the 2010-2011 fiscal year. The PSERS also projects that employer contribution rates will reach 20 percent in two decades.

State lawmakers are debating bills aimed at dealing with the coming 2012 surge in Pennsylvania schools’ required contributions to the employee pension system. Bills being considered would create a Defined Contribution system, a hybrid DB system or lower benefits by changing the benefits formula, reducing the multiplier, increasing retirement ages and calculating final average salary on five years rather than the current three.

HB 2135 and SB 1185 would create a Defined Contribution system for new state employees.

Rhode Island:
May: HB 7561 sponsored by Representative Lally would lock in current benefits for all state employees who are vested after 10 years of service. The bill would block efforts by the General Assembly and the Governor to scale back pension benefits.

The House and Senate both approved a bill to put a temporary halt on payments to the pension fund until June 15th.

Victor Moffitt, a Republican gubernatorial candidate, has said he supports moving all public employees into a Defined Contribution system. The current General Treasurer, and Democratic gubernatorial candidate, Frank T. Caprio also supports moving public employees into a Defined Contribution System. The only gubernatorial candidate who does not support moving public employees into a Defined Contribution or hybrid system is Attorney General Patrick Lynch.

The General Assembly passed the deficit-cutting budget with both the provision to reamortize the pension fund as well as restricting COLAs. However, the Senate rejected the reamoritization, sending the legislation back to the General Assembly.

The General Assembly unveiled their deficit-cutting plan, while also getting it passed through the House Finance Committee during the night of April 8th. The budget has a provision to reamortize the state retirement system’s $4.3 billion unfunded liabilities over 25 years. There are also curbs on teacher and state worker pensions. Lawmakers chose to limit the COLA payments to the first $35,000 in retirement pay, and to retirees who have reached age 65. The bill also caps the COLA at 3 percent, and instead of it being a guaranteed yearly increase the General Assembly would have to decide each year what COLA would be given to teachers and state workers.

Cranston Mayor Allan W. Fung announced a contract agreement with the local Teamsters union to move new hires into a Defined Contribution system.

Public employees in Rhode Island have received support from the National Public Pension Coalition.

The Regular Session begins on January 5th, 2010 and is expected to adjourn in late June.

South Carolina:
The Regular Session began on January 12, 2010 and ends on June 3, 2010.

South Dakota:
Both chambers of the legislature passed the Board of Trustee recommendations pertaining to return to work and COLAs. The Governor signed the legislation on March 12th. They are really two bills, SB 18 and SB 20. The trustees want a three-month waiting period between retirement and returning to work for the state government. There would also be no COLA increases for these rehires. Rehired retirees would also receive a 15 percent reduction in their retirement payments while employed. They also recommended reducing cost of living adjustments and other payouts by an estimated $368 million over the next 30 years. The COLA is currently an annual 3.1 percent. However, with the new proposal a smaller increase would be given in the case where the System’s investments falls below 100 percent of the market values necessary for the system to remain in financial balance. In the years where the system was underfunded, the COLA would be 2.1 to 2.8 percent.

The session ended on March 12th.

Tennessee:
The State Treasurer, on January 28, proposed increasing the state contribution rate to the state pension fund from 13.11 percent to 15.01 percent. The session will end on May 20th.

Texas:
The Employees Retirement System of Texas released its recommendation for benefit cuts. They recommend requiring public employees to pay higher co-pays for doctor visits and prescription drugs. Texas legislature meets in odd number years, meaning that there is not a 2010 Legislative Session.

Utah:
Session ended on March 11th.

The Governor signed SB 63 and SB 43 on March 29th. SB 63 was amended so that now new public employees have a choice between a scaled down Defined Benefit system, or a Defined Contribution system in which they can contribute 10% of their salary. Liljenquist formally withdrew SB 94 on March 1, 2010. The bill would have eliminated a 1.5% contribution to the 401(k) accounts. SB 63 requires that all employees covered under the state retirement system work 35 years to earn a full pension and 25 years for public safety workers. The bill is estimated that employer contributions to the retirement system for new hires (hired after July 1, 2011).

Vermont:
The legislative session adjourned on May 12, 2010.

State Treasurer Jeb Spaulding and Vermont NEA came to an agreement about retirement plan reform. Under the agreement teacher’s retirement age would increase to 65 or a combination of age and years of service that add up to 90. Teachers would pay 5 percent towards their pension plans, up from the current 3.4 percent. Under the new plan teacher wage replacement rates are expected to improve by 10%. Employees retiring more than five years from normal retirement age (65) will be eligible for a maximum benefit of 60 percent of their average final compensation with a higher multiplier (2% instead of 1.67%) upon completing 20 years of service. Employees retiring within five years of normal retirement age will receive a maximum 53.34 percent of final average salary (up from the current 50%) while using the same multiplier of 1.67 percent. The bill was HB 764 and was signed by the Governor on April 7th.

Public employees in Vermont have received support from the National Public Pension Coalition.

Virginia:
The legislative session ended on March 14th.

During the session Governor McDonnell proposed to strike language from the state budget that would allow localities to shift a portion of their pension contributions to employees. The approved budget delays payments to the pension fund, effectively borrowing $620 million from the fund while promising to start repaying in 2013 with 7.5 percent interest. The budget also increases the retirement age for new hires, and recalculates benefits for new hires. New hires will also have to pay a five percent contribution to the pension. However, the state will continue to pay for employee contributions for current employees. The budget bills are HB and SB 29 and 30.

HB 610, which did not become law, would have moved new employees hired after July 1, 2010 into a Defined Contribution Plan.

Washington:
The Regular Session ended on March 11th.

The state actuary, Matt Smith, gave a report to the Pension Funding Council on October 2, 2009. In the report he explained that the state needs to double its yearly payments to the pension system to keep its oldest plans solvent. The plans needing higher contributions are PERS 1 and TRS 1. The state budget director, Victor Moore, stated during the meeting that state workers and employers would see their contributions increase. Smith did say that the plans 2 and 3 are healthy.

West Virginia:
The legislative session ended on March 20th. However, an extraordinary session began on May 13th.

In January 2010, the state Consolidated Public Retirement Board voted to increase employer contributions from 11 percent to 17 percent. County commissioners asked the Legislature for help with a 64 percent increase in employer contributions, which take effect July 1, 2010.

State lawmakers in a special Senate Committee considered increasing the retirement age for new hires from 55 years old to 60 and increasing the number of necessary years to become vested from 5 to 15.

Wisconsin:
The Wisconsin Investment Board projects that state workers will see a 1 percent reduction in benefits in 2010. There is no 2010 Legislative session.

Wyoming:
The session ended on March 5th.

The Senate passed SF 72, which required state employees to pay half of the increase in their retirement contribution, making the plan contributory. The House of Representatives also passed SF 72, but only after adding an amendment, which required public employees (teachers) to also begin contributing to their pension plans. The bill now must go back to the Senate or go to a conference committee. The bill was signed by the Governor. The bill now requires that all public employees must pay 7 percent to the pension fund, up from 5.57 percent, while also increasing employer rates to 7.12 percent.