Senate Finance puts public employee retirement bill on hold

Late last month, the Senate Finance Committee introduced bills to cut back the Community Revenue Sharing grant program, and up the amount schools and municipalities pay towards employee’s pensions. But now at least one of those bills – the one dealing with PERS contributions – has been put on hold. The bills were pulled from Monday’s scheduled hearing with less than a day’s notice.

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Four bills introduced last week would dramatically increase local contributions to the Teachers and Public Employees’ Retirement System, halve the community revenue sharing program, and eliminate a college scholarship program.

The package of legislation was pulled off the Senate Finance schedule late Sunday ahead of an opportunity for public comment Monday afternoon.

School districts, like Dillingham’s, were preparing to paint a picture of the impact of increased PERS and TRS contributions.

Superintendent Danny Frazier says it would mean losing more teachers on top of the four positions the district has already cut in a tough budgeting process this spring.

“We’ve already been through the budget study where we invited the public to come and comment on the budget,” said Frazier. “And it’s pretty easy to see that 64% of our budget is in personnel. So we don’t have a lot of places to get money except for personnel. So it’s going to impact us greatly in that we could lose 3 teaching positions, and district just doesn’t have the money in reserve to pay these extra expenses.”

Even if the legislature passes an anticipated $50 increase to the Base Student Allocation, Frazier says that additional money would make up for less than a quarter of the increased PERS and TRS burden.

“I’m sure that some of the Senate members realize there’s going to be a lot of pushback on these bills,” says Kathie Wasserman, executive director of the Alaska Municipal League, “because while they are certainly opposed to raising taxes, it’s really strange that they’re not opposed to us raising taxes.”

Wasserman has been working against the bills since they were rolled out last week.

“These are not just small bills. These are not small amounts, these are huge amounts. Cities who contribute to their schools — since school districts can’t raise money — all of this is going to fall on municipalities, with the PERS and the TRS. I mean, I can’t imagine what they were thinking when they drafted these bills.”

The bill’s sponsors have said some of the new costs to districts and municipalities would be offset by money that’s currently being used for the Alaska Performance Scholarships, and by local property tax increases on veterans and senior citizens.

Hearings on the bills were cancelled for Monday and Tuesday.

In a press release late Monday afternoon, Senate Majority leaders announced they will not move forward with Senate Bill 209, the PERS increase.

The Senate will hold a hearing on S.B. 207, the TRS bill, later this week.