PERS Relief Included in Revenue Sharing Bills
March 11, 2006
"I look forward to seeing these bills signed into law. I am proud that as chair of CRA and a member of the Finance Committee, I am in a position to bring revenue sharing and retirement system underfunding relief to the forefront of the conversation. Our communities need assistance for both of these issues. The committee substitutes reflect that these are necessarily intertwined issues but also makes clear how the funds are appropriated to cover each need," said Sen. Stedman.
According to Stedman, the $29.3 million dollar appropriation is in addition to the $28 million dollar appropriation for municipal revenue sharing. It funds the projected shortfall between what the employers will pay in FY 07 versus what they should pay according to the system actuary.
The committee substitute for SB 246 appropriates $29.3 million dollars in general fund revenue to help local governments meet their growing obligation to the retirement account. The committee substitute for SB 247 dictates how the money is to be allocated by the department of administration.
This interim Sen. Stedman served on the Alaska Advisory Commission on Local Government. The Commission spent the summer working on addressing the need for essential services at the local level and determining the role of state government in the financing local services. Based on the work of the Commission, three bills were introduced by the Senate Community and Regional Affairs Committee. SB 247 creates a revenue sharing fund, SB 246 makes an appropriation to the revenue sharing fund, and SB 248 creates of administrative boroughs.
Also last session, Sen. Stedman took the lead in advocating for PERS/TRS reform. That effort culminated in the enactment of critical legislation to stem the growing $6 billion unfunded pension liability in the PERS and TRS and created the Alaska Retirement Management Board (ARMB). ARMB was tasked with analyzing and recommending short-term and long-term solutions for addressing the under funding. ARMB is still working on recommendations that it will present to the legislature.
"The $29.3 million dollars gives local governments some relief while the administration, the legislature and the Alaska Retirement Management Board continue to craft a long term solution to the problem," said Sen. Stedman.
SB 246 and SB 247 were passed out of the Community & Regional Affairs Committee Friday and now move to the Senate Finance Committee. Sen. Stedman sits on that committee as well.
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