Bills propose increased local contributions to pension plans

  • By Becky Bohrer
  • Monday, March 28, 2016 9:35pm
  • News

JUNEAU, Alaska — Bills calling for increased local contributions to two state pension programs and an overhaul of a community assistance program have been proposed in the Alaska Senate as lawmakers look to further cut costs amid a bulging budget deficit.

Measures introduced Monday would increase local contributions to the public employees’ and teachers’ retirement systems.

They also would phase-out a state-sponsored scholarship program and scale back the community revenue sharing program.

The bills, from the Senate Finance Committee, are interlinked: the teachers’ retirement system and scholarship bills play off each other, as do the public employees’ retirement and community revenue sharing bills.

A major teachers’ union and a municipal group were reviewing the bills and awaiting further details, but expressed concerns with their apparent direction.

Senate Finance Committee co-chair Pete Kelly, R-Fairbanks, said money from the scholarship program would be used to ease the initial impact on districts from the proposed increase in teachers’ retirement system contributions.

There is language in the teachers’ retirement bill stating that it’s the Legislature’s intent to provide additional money to districts to mitigate the increased costs for the first five fiscal years under the bill.

Kelly said if lawmakers want to offset the impact on districts, it will have to find the money somewhere, and in this environment, they have to look at things that the state can’t do anymore. The state faces a multibillion-dollar deficit amid low oil prices.

Under the proposals, the scholarship program, which requires recipients fully use their awards within six years of graduating from high school, would end in 2022. SB 208 would allow for scholarships for students who graduate high school on or before July 15, 2016.

The program was created in 2011 as a way to better prepare students for post-secondary success.

Scholarship recipients require less remedial coursework and take more credit hours than non-recipients, according to an annual report on the program.

Ron Fuhrer, president of NEA-Alaska, a teachers’ union, said he wants to better understand what the impact on districts will be. He said he has concerns with ending the scholarship program.

Laura Cramer, an aide to Senate Finance co-chair Anna MacKinnon, said provisions in the community assistance bill would make certain property tax exemptions optional, providing a way for communities to offset the proposed increase in their contribution to the public employees’ system.

Kathie Wasserman, executive director of the Alaska Municipal League, worries that making those exemptions optional could impact the calculation for local school contributions, causing them to skyrocket.

She said she doesn’t know where lawmakers expect communities to come up with an increased share for the public employees’ system.

Communities had been bracing for changes to the revenue sharing program but they’re also feeling the pinch from a bare-bones state infrastructure budget, cuts to the ferry system and additional pension costs under a previous restructuring of payments, she said.

Then “to hand us another bill on top of things, that’s just, that’s where we have to say, Enough,” she said.

The Senate, in its version of the state operating budget, proposed using $342 million in left-over reserve funds this year toward additional payments to the two retirement systems. The House and Senate have yet to finalize a budget package.

More in News

Syverine Bentz, coastal training program coordinator for the Kachemak Bay Research Reserve, displays a board of ideas during a Local Solutions meeting focused on salmon at the Cook Inletkeeper Community Action Studio in Soldotna, Alaska, on Monday, Feb. 10, 2025. (Jake Dye/Peninsula Clarion)
In search of salmon solutions

Cook Inletkeeper hosts meeting to develop community project to help salmon.

Lisa Gabriel, left, watches as beach seine nets are pulled from the waters of Cook Inlet at a test site for the gear near Kenai, Alaska, on Tuesday, July 30, 2024. (Jake Dye/Peninsula Clarion)
CFEC to consider seines for east side setnet fishery

The change is contingent on the State Board of Fisheries approving the gear during their March meeting.

A map of 2025 construction projects scheduled for the Kenai Peninsula. (Provided by Alaska Department of Transportation and Public Facilities)
Department of Transportation announces construction plans

Most of the projects include work to various major highways.

Seward City Hall is seen under cloudy skies in Seward, Alaska, on Thursday, Nov. 7, 2024. (Jake Dye/Peninsula Clarion)
Seward adds full-time staffer for recently restarted teen rec room

Seward’s Parks and Recreation Department reclaimed responsibility for teen programming at the start of this year.

Gavin Ley stands with the “Go-Shopping Kart” he designed and built in his career and technical education courses at Nikiski Middle/High School in Nikiski, Alaska, on Tuesday, Feb. 11, 2025. (Jake Dye/Peninsula Clarion)
Nikiski students learn professional skills through technical education

Career and technical education gives students opportunity to learn skills, express themselves creatively, work cooperatively and make decisions.

Nikiski teachers, students and parents applaud Nikiski Middle/High Principal Mike Crain as he’s recognized as the Alaska Association of Secondary School Principals 2025 Region III Principal of the Year by the Kenai Peninsula Borough School District’s Board of Education during their meeting in Soldotna, Alaska, on Monday, Feb. 3, 2025. (Jake Dye/Peninsula Clarion)
Nikiski principal named Region III principal of the year

Crain has served as Nikiski’s principal for three years.

An 86 pound Kenai River king salmon is measured in Soldotna, Alaska, on June 29, 1995. (M. Scott Moon/Peninsula Clarion File)
Kenai River king salmon fishing closed entirely for 3rd year

Kenai River king salmon were designated a stock of management concern in 2023.

The Kenai Peninsula College Main Entrance on Aug. 18, 2022, in Soldotna, Alaska. (Jake Dye/Peninsula Clarion)
University of Alaska Board of Regents to meet in Soldotna

The last time the board met on the Kenai Peninsula was April 2012.

Kenai Peninsula Borough School District Board of Education member Penny Vadla and student representative Emerson Kapp speak to the joint Alaska House and Senate education committees in Juneau, Alaska, on Monday, Feb. 10, 2025. (Screenshot courtesy Gavel Alaska/KTOO)
KPBSD among dozens of districts to deliver in-person testimony to Alaska Legislature

Districts spotlighted programs already lost over years of stagnant funding that hasn’t met inflationary pressure.

Most Read