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ASEA/AFSCME Local 52 Legislative Report
May 4, 2007

The first session of the 25^th Alaska Legislature will adjourn on Tuesday, May 16. There are approximately 2 weeks left in the session.

24-Hour Hearing Notice in Effect: The House (on Apr. 23) and Senate (on Apr. 27) appointed conference committees for HB 95, a bill to fund the operating budget. When conference committees are convened to reconcile differences between the House and Senate versions of the operating budget, the Legislature adopts a 24-hour notice policy for all committee hearings. Bills will begin to move quickly though the legislative process after the 24-hour rule is applied. As of Apr. 27, all bills can be heard if given notice the day before.

Bills on the move:

The following bills are getting hearings and await committee action:

HB 13-Issue Bonds to Control Unfunded PERS/TRS Liability --> Senate Finance
HB 48-PPT Credits to Offset Unfunded PERS/TRS Liability --> Senate Finance
HB 95-Operating Budget --> Conference Committee
HB 125-Long-Range Fiscal Plan --> Senate Finance
HB 179-Revisions to Defined Benefit Retirement Plan --> House Finance
HB 209-Regulatory Commission of Alaska --> House Judiciary
SB 28-Limit Mandatory OT for Registered Nurses --> Senate Labor & Commerce
SB 153-Military Time toward 20-year Retirement --> Senate Labor & Commerce

The following bills wait for floor action:

HB 164-Modify Ocean Ranger Program --> House Floor
SB 125-State Bailout of PERS/TRS Unfunded Liability --> Senate floor

The following bills wait for the governor's signature:

SB 123-Revisions to Defined Benefit Retirement Plan --> Passed both chambers

Legislation: HB 13 (Issue Bonds to Control Unfunded PERS/TRS Liability)
Status: Pending
Sponsor: Rep. Mike Hawker (R)-Anchorage
ASEA Position: SUPPORT       
PAC Recommendation: SUPPORT

Bill Status: HB 13 was introduced by Rep. Mike Hawker as a pre-filed bill in January 2007. The bill gained eight co-sponsors during its House committee referrals. A committee substitute for HB 13 passed the House and was transmitted to the Senate on April 26. CSHB13 (FIN) was referred to Senate Finance the following day.

Bill Summary: HB 13 creates a mechanism for the issuance of bonds to stabilize the unfunded liability of the state's defined contribution retirement systems. The first of two fiscal notes attached to the bill reads, "The premis (sic) of undertaking this type of transaction is borrowing at rates that are at least 1.5% lower than the actuarial assumed rate of return on the pension funds (8.25%)."

The resulting capitalization by one or more municipalities through the bonding process would require accounting practices that are not currently understood. From the second fiscal note, "The division [Retirement & Benefits] will work with the Department of Law to develop regulations to govern the accounting for such accounts."

Action Needed: Contact members of the Senate Finance committee to encourage support of this legislation.

Legislation: HB 48 (PPT Credits to Offset Unfunded PERS/TRS Liability)
Status: Pending
Sponsor: Reps. Paul Seaton (R)-Homer and Mike Kelly (R)-Fairbanks
ASEA Position: MONITOR
PAC Recommendation: MONITOR

Bill Status: HB 48 is currently in Senate Finance after passing the House without opposition.

Bill Summary: This bill would authorize the Alaska Retirement Management Board (ARM) to purchase transferable tax credit certificates for 92 percent of the face value of the certificates. The ARM board would then sell the certificates to the Department of Revenue for the full face value of the certificates. The proceeds of these sales would be used by the ARM board to defray the unfunded liability of the state's defined contribution retirement systems.

Action Needed: No action is currently recommended.

Legislation: HB 95 (Operating Budget)
Status: Pending
Sponsor: Request of the Governor
ASEA Position: MONITOR
PAC Recommendation: MONITOR
Companion Bill(s): SB 50

Bill Status: On April 24, the House appointed three members (Representatives Chenault, Meyer and Joule) to a Conference Committee. The need for a CC was confirmed on April 27 by the Senate, which appointed Senators Hoffman, Stedman and Dyson. The CC for the operating budget invokes the 24-hour rule for committee hearings (see above).

Bill Summary: This bill does not currently contain appropriations for a GGU collective bargaining agreement or an appropriation for increased employer health care contributions for GGU members. Once negotiations between ASEA and the state are complete, these monetary terms could be inserted into HB 95 or some other appropriations bill.

Action Needed: No action is currently recommended.

Legislation: HB 125 (Long-Range Fiscal Plan)
Status: Pending
Sponsor: Ways & Means
ASEA Position: SUPPORT
PAC Recommendation: SUPPORT

Bill Status: The House Ways & Means Committee, chaired by Rep. Mike Hawker, introduced HB 125 in February 2007. It passed the House in the form of CSHB 125(FIN) without opposition. The Senate Finance committee is its first (and currently only) committee of referral.

Bill Summary: The bill would require the governor to balance the state budget and to submit a long-range fiscal plan supported by analysis of fiscal data for the succeeding 10 years. The bill would effectively prevent the state from allowing operating shortfalls cause the interruption of state services.

Action Needed: Contact members of the Senate Finance committee to encourage support of this legislation.

Legislation: HB 164 (Modify Ocean Ranger Program)
Status: Pending
Sponsor: Transportation
ASEA Position: OPPOSE
PAC Recommendation: OPPOSE

Bill Status: HB 164 was introduced this spring by the House Transportation Committee, chaired by Rep. Kyle Johansen. It was referred to its sponsoring committee, House Judiciary and House Finance, each offering lukewarm support. The bill waits for House floor action in the form of CSHB 164(FIN).

Bill Summary: The bill would authorize the DEC Commissioner's discretion over the implementation of the Ocean Ranger program to fulfill the intent of Ballot Measure No. 2., passed by the voters in November 2007.

Action Needed: No action is currently recommended.

Legislation: HB 179 (Revisions to Defined Benefit Retirement Plan)
Status: Pending
Sponsor: Rep. Mike Kelly (R)-Fairbanks
ASEA Position: OPPOSE
PAC Recommendation: OPPOSE

Bill Status: HB 179 passed the House State Affairs Committee in early April after the provision increasing employee contributions by 5% to 11.5% of salary. This provision was removed in House State Affairs on a six to one vote. The bill waits for a hearing in House Finance.

Bill Summary: This bill revises SB 141 to specify a funding source for teachers' disability and death benefits; add annual cost of living increases to catastrophic benefits in the new defined contribution retirement plan; limits survivor entitlements while receiving disability or death benefits; clarifies changes to maintain Internal Revenue Code requirements.

Action Needed: Contact members of the House Finance Committee to discourage re-introduction of an employee retirement contribution rate increase.

Legislation: HB 209 (Regulatory Commission of Alaska)
Status: Pending
Sponsor: Labor & Commerce
ASEA Position: OPPOSE
PAC Recommendation: OPPOSE

Bill Status: House Labor & Commerce Committee (Rep. Kurt Olson, chair) introduced HB 209 this spring. The bill is currently waiting for a hearing in House Finance after being referred to its sponsoring committee and House Judiciary. So far, the bill has not enjoyed strong support in the form of committee recommendations.

Bill Summary: This bill was originally drafted with language to transfer GGU members in the Regulatory Commission of Alaska (RCA) from classified service to partially-exempt service. This provision has been removed from the legislation at the request of ASEA. The bill is expected to be reported out with a new title and amended language.

Action Needed: No action is currently recommended.

Legislation: SB 28 (Limit Mandatory OT for Registered Nurses)
Status: Pending
Sponsor: Sen. Bettye Davis
ASEA Position: SUPPORT
PAC Recommendation: SUPPORT

Bill Status: This bill has received hearings in the Senate Health, Education and Social Services Committee and Senate Labor & Commerce Committee. It waits for further hearings in Senate L&C.

Bill Summary: Restricts mandatory overtime for nurses except in circumstances of emergency, and provides for penalties and compensation.

Action Needed: Contact members of the Senate Labor & Commerce Committee to encourage support of this legislation.

Legislation: SB 123 (Revisions to Defined Benefit Retirement Plan)
Status: Passed
Sponsor: Request of the Governor
ASEA Position: OPPOSE
PAC Recommendation: OPPOSE
Companion Bill(s): HB 204

Bill Status: This bill passed the House after an amendment to offer new employees an option to choose between the defined contribution and the defined benefit retirement programs failed on a 15-21 vote. The bill was returned to the Senate for concurrence and passed without opposition. The bill waits for signing by the governor.

Bill Summary: This bill revises SB 141 to specify a funding source for teachers' disability and death benefits; add annual cost of living increases to catastrophic benefits in the new defined contribution retirement plan; limits survivor entitlements while receiving disability or death benefits; clarifies changes to maintain Internal Revenue Code requirements and adds the governor, lt. governor, legislators and elected municipal to the defined contribution retirement plan.

Legislation: SB 125 (State Bailout of PERS/TRS Unfunded Liability)
Status: Pending
Sponsor: Request of the Governor
ASEA Position: SUPPORT       
PAC Recommendation: SUPPORT
Companion Bill(s): HB 206

Bill Status: This bill has passed through the Senate Finance Committee, chaired by Sen. Bert Stedman, and waits for Senate floor action.

Notice: SB 125 passed the Senate on May 4, 2007 with a 14-3 margin. The bill will be forwarded to the House for consideration.

Bill Summary: SB 125 re-assigns responsibility for the PERS/TERS unfunded liability through a cost share program. Under the proposed legislation, employer contributions would be set at 22% (PERS) and 12.56% (TRS). The bill also includes a "hold harmless" provision for employers contributing less that 22% into PERS and substantial state appropriations to stabilize the unfunded liability.

Action Needed: Contact members of the House to encourage passage of this important legislation to stabilize the PERS/TRS unfunded liability.

Legislation: SB 153 (Military Time toward 20-year Retirement)
Status: Pending
Sponsor: Sen. Hollis French (D)-Anchorage
ASEA Position: SUPPORT
PAC Recommendation: SUPPORT

Bill Status: SB 153 was sponsored by Sen. Hollis French in April 2007 and has been co-sponsored by Sen. Lesil McGuire. The bill waits for a hearing in the Senate Labor & Commerce Committee, then Senate State Affairs and Senate Finance.

Bill Summary: This bill would allow peace officers and firefighters to use up to five years of credited military time to qualify for retirement benefits.

Action Needed: Contact members of the Senate Labor & Commerce Committee to encourage support of this legislation.