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

A sign warning of a June 28, 2021, bear attack is placed at the head of the Kenai River Trail on Skilak Loop Road in the Kenai National Wildlife Refuge on June 30, 2021. (Photo by Erin Thompson/Peninsula Clarion)
Federal wildlife officers seek information about early-May black bear poaching

Officials think the poaching happened near the east entrance of Skilak Loop roughly 2 miles from Jims’ Landing

Alaska State Troopers logo.
Ninilchik woman dead after Tuesday collision

The woman was attempting to cross the Sterling Highway from Oil Well Road when she was struck by a pickup truck

Graduates listen to Connections Homeschool Principal Doug Hayman speak during the school’s commencement ceremony on Thursday in Soldotna. (Ashlyn O’Hara/Peninsula Clarion)
Graduates listen to Connections Homeschool Principal Doug Hayman speak during the school’s commencement ceremony on Thursday, May 16, 2024 in Soldotna, Alaska. (Ashlyn O’Hara/Peninsula Clarion)
‘Expect a lot from yourself and from others’

Connections Homeschool students accept diplomas at commencement ceremony

Graduates of Seward High School leave the gym at the end of their graduation ceremony on Wednesday.
‘Give people something to talk about’

Seward High School graduates 30

Kenai Police Chief David Ross speaks to Kenai City Council members about an ordinance that would repeal sections of city code that prohibit public sleeping and loitering and the city’s curfew on Wednesday, May 15, 2024, in Kenai, Alaska. (Ashlyn O’Hara/Peninsula Clarion)
Kenai OKs repeal of loitering laws, curfew for minors

The policies, first enacted in 1978, are difficult to enforce and potentially violate citizens’ rights, according to the Kenai Police Department

Nikiski Middle/High School graduates throw their caps into the air at the conclusion of a graduation ceremony in the school’s gym in Nikiski, Alaska, on Wednesday, May 15, 2024. (Jake Dye/Peninsula Clarion)
Nikiski graduates ‘will always be a part of each other’s stories’

The graduates celebrated their time together and took a moment to anticipate the bright futures that lie ahead

A seal pup rescued from near Kenai beach is treated by the Alaska SeaLife Center’s Wildlife Response Program on May 9, 2024. (Photo courtesy Kaiti Grant/Alaska SeaLife Center)
SeaLife Center admits abandoned harbor seal pups

Both seals were found abandoned and malnourished, and both were born prematurely

Caitlin Babcock, left, and other graduates enter Soldotna High School’s commencement ceremony on Tuesday, May 14, 2024, in Soldotna, Alaska. (Ashlyn O’Hara/Peninsula Clarion)
Soldotna sends off more than 140 graduates at Tuesday commencement

More than 140 students stepped off the Soldotna High School graduation stage… Continue reading

Most Read