May Legislative Report, By Ross Buie

After an almost complete rewriting of Senate Bill1985, the bill sailed through the Senate by a vote of 57-0.  The bill now sits in the House, awaiting action, not at all a sure thing, despite the over whelming approval in the Senate. As I said, last month, what generally emerges from lengthy studies and negotiations is a bill that is not entirely satisfactory to any of the parties involved, but, in this case, it apparently struck a note with the Senate membership. So, let's look at the actual language of the bill, as it emerged from the Senate.

Beginning July 1, 2009, the offset under this subsection shall no longer be applied to any widow's annuity of any person who began receiving retirement benefits, or a widow's annuity, prior to January 1, 1998.

Beginning July 1, 2009, the offset under this subsection shall no longer be applied to the widow's annuity of any person who began receiving a widow's annuity on or after January 1, 1998, and before the effective date of this amendatory act of the 95^th General Assembly.

Any person who began receiving retirement benefits after January 1, 1998, and before the effective date of this amendatory act of the 95th General Assembly may, during a one time election period establishes by the System, elect to reduce his or her retirement annuity by 1% in exchange for not having the offset under this subsection applied to his or her widow's annuity.

Any employee in service on the effective date of this amendatory Act of the 95thGeneral Assembly may, at the time of retirement, elect to reduce his or her retirement annuity by 1% in exchange for not having the offset under this subsection applied to his or her widow's annuity. The same provisions apply to survivor's benefits.

However, there is already a problem with the numbers, as revealed in an actuarial study initiated by our retirement system. This study indicates that a one percent contribution by retirees would not make this bill revenue neutral. In other words, the contribution rate will have to be raised in order to ensure that the state will not have to cough up one additional penny for our survivors. At this writing, we have no idea what that final percentage will be, or if we might reach a point where we can no longer support our own bill. Needless to say, we will be in there fighting for the best deal we can get!

For us, the perfect scenario would be for the entire House to approve the bill, as is, and send it on the governor for his action. If, however, the House decides to make changes in the bill, which, in light of the above actuarial study, is not only possible, but probable, it would then have to be sent back to the Senate, for concurrence.  And, even that depends on the House bringing the bill to a vote. Unfortunately, in our ego and power driven political climate, bills are often shelved, not because they have no merit, but simply because they came from the other chamber.

For information on your local legislators, go to http://www.ilga.gov/.

Have a question or comment? e-mail Ross Buie at RSEALEG@aol.com

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