July 27, 2005
Murkowski signed Senate Bill 141, sponsored by Sen. Bert Stedman, at the 4th Avenue Anchorage Legislative Information Office. The governor was joined by lawmakers who carried the measure from its original drafting in the Senate Finance Committee through hours of hearings to final passage in a legislative special session.
"Soon after I took office, we learned that this administration had inherited a $4 billion unfunded pension liability that has since grown to $5.7 billion," Murkowski aid. "We have a constitutional duty to make sure every dollar of pension benefits are paid and so we had a responsibility to enact reform."
Melanie Millhorn, director of the Division of Retirement and Benefits in the Alaska Department of Administration, said the reform's major changes would be implemented for employees hired after July 1, 2006. This new defined contribution plan is similar to the 401(k) plans used by federal and many private sector employers.
"The defined contribution plan provides comprehensive retirement benefits and will be an effective recruiting tool for future public employees," Millhorn said. "If a young family is dreaming of new life adventures and careers in Alaska, the defined contribution offers more flexibility than the defined benefit program."
"Now we are working during
the interim with the House Special Committee on Ways and Means
and the Senate," Murkowski added. "Our priority in
the next session is to help the legislature craft a realistic
and effective solution to the unfunded pension liability we inherited."
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