What a Rollercoaster Ride!!!

This legislative session was a roller coaster ride, most especially as it pertained to our efforts to secure cost-of-living increases for employees and retirees.  It truly was a now you see it – nowyou don’t – now you see it – type scenario.  However, both groups will receive increases again this year.  The standard health insurance program will again experience no adverse changes and the mileage reimbursement rate will be increased to the current IRS level.  Once again the Association stood as a buffer to proposed legislative changes that would have made employees susceptible to arbitrary and capricious treatment. 

Our efforts this year yielded the following:   

1.         A 1% cost-of-living adjustment for state employees effective July 1, 2008. 

2.     The employee health insurance program’s premiums and benefits remain at current levels for employees, retirees and their families.                 

3.     Mileage reimbursement rates for employees required to use their personal vehicles for agency purposes will be paid at the IRS level of 50.5 cents a mile.

        The state currently reimburses at the rate of 44.5 cents per mile.  The new rate will be effective July 1, 2008. 

Legislation establishing a guaranteed annual 2% COLA for retirees became law in spite of the Governor’s objection when the General Assembly overrode his veto.  However, for the law to be implemented the bill requires that the Budget & Control Board increase the Assumed Rates of Return on the Retirement Systems investments from 7.25% to 8%.  We are confident that the Board will meet this requirement because four of the five Board members voted in support of this legislation.  They are Treasurer Converse Chellis, Senate Finance Committee Chair Hugh Leatherman, House Ways and Means Committee Chair Dan Cooper and Comptroller General Richard Eckstrom.  It is anticipated the Board will address this issue at its Tuesday, June 17^th Board meeting.  Retirees are currently guaranteed a 1% Annual COLA.

The following free-standing legislation did not pass this year and will have to be reintroduced next year for further action:

A.  House Bill 3257 sponsored by Representatives Taylor, Duncan and M. A. Pitts would establish a committee to study a step increase compensation plan for state employees.   

            B.  Senate Bill 239 sponsored by Senators Ryberg, Bryant, Fair, Richardson and Verdin and House Bill 3007 sponsored by Representatives Kirsh, G. R. Smith, Witherspoon and Mahafffey would close the Teacher and Employee Retention Incentive (TERI) Program to new participants effective July 1, 2007 and repeal effective July 1, 2010 the establishment of the Program. 

            C.  Senate Bill 238 sponsored by Senators Ryberg, Bryant, Fair, Richardson and Verdin would re-establish full retirement eligibility from twenty-eight (28) years to thirty (30) years service. 

            D.  Senate Bill 307 sponsored by Senator Grooms would provide that retired members of PORS who are reemployed under the SCRS not be required to make employee contributions to the System. 

            E.  House Bill 3010 sponsored by Representative Talley would increase the amount of unused sick leave as service time at retirement from 90 days to 120 days.  

            F.  Senate Bill 197 sponsored by Senators Ritchie, Richardson and Knotts would not only make employees at-will (no grievance rights), down to the third level, but would also include employees with an annual salary of $50,000 and above. 

            G.  Senate Bill 514 sponsored by Senator Reese would require the Budget and Control Board to devise and implement an annual longevity pay increase for classified state employees.  

H.   Senate Bill 515 sponsored by Senator Reese would provide a State Employee Pay Career Incentive Plan (STEP).   

June 14, 2008