Provides for a five-year final average compensation period. (1/1/11) (EG -$86,700,000 APV)
Impact
This legislation proposes a significant shift in calculating retirement benefits by allowing more comprehensive and longer-term averages of earnings to be considered. The adjusted calculation approach is anticipated to enhance benefits for longtime employees who have accumulated more earnings over their careers. Furthermore, it introduces a transitional phase for members affected by these changes, stipulating conditions for those nearing retirement during the adjustment period. The fiscal implication of this bill has been estimated at $86.7 million in anticipated annual payments, a substantial consideration for the state budget.
Summary
Senate Bill 100 aims to amend the Parochial Employees Retirement System by defining 'final compensation' based on the highest average earnings over a period of 60 consecutive months, as opposed to the previous 36 months. The bill is designed to impact how retirement benefits are calculated for employees upon their retirement, providing a potentially higher benefit for those with longer tenures. By adjusting the parameters for compensable earnings, the bill seeks to provide additional clarity and equity in the calculation of retirement benefits.
Sentiment
General sentiment surrounding SB100 appears to be supportive among those who advocate for enhanced retirement security for employees within the Parochial Employees' Retirement System. Supporters argue that the bill is a fair measure toward ensuring that long-term employees receive benefits reflective of their service and total earnings. Conversely, there are concerns regarding the potential strain on the state's budget from increased pension obligations, which has led to some debate around fiscal responsibility and long-term viability of such changes.
Contention
Notable contention regarding the bill arises from its potential impact on state pension funds and the sustainability of benefits provided. While proponents emphasize that it will provide necessary benefits for dedicated employees, opponents raise worry over the financial burden it may impose on the state’s budget and whether such increases in retirement payouts can be responsibly managed without negatively affecting other public services.
Provides a sixty-month final average compensation period for members of state and statewide retirement systems. (7/1/13) (OR -$107,000,000 FC GF LF EX)
Relative to the Clerks' of Court Retirement and Relief Fund, changes the definition of average final compensation for calculation of benefits of active members (EN -$25,000,000 APV)