SANTA FE – Procedural wrangling over a proposal to shore up the cash-strapped New Mexico Public Employees Retirement Association prompted a Senate panel Monday to keep the bill in the legislative starting blocks.
In other words, a lot of talking and not much action – at least so far.
After members of the Senate Judiciary Committee voted to hold off on the solvency legislation so that it can be combined with related legislation, PERA Executive Director Wayne Propst noted there is still plenty of time left in the 60-day legislative session.
“I think we have some work to do to answer the questions raised by legislators and ensure there is a comfort level with the bill,” Propst told the Journal.
Pension solvency is expected to be a top issue during this year’s session, as the financial conditions of the state’s two large public retirement systems – PERA and the Educational Retirement Board – have worsened in recent years.
The PERA plan, Senate Bill 27, calls for retirement benefits to be scaled back for retirees, future employees and current government workers covered by the retirement system. It also proposes increasing the amounts of money that both employees and their government employers pay into the retirement fund and would impose stricter retirement eligibility on future workers. If enacted, the changes would affect more than 96,000 retirees and active employees.
Although the bill has largely been supported by labor unions and retiree groups, representatives of several organizations testified against it Monday.
Mike Sindelar of the San Juan County Sheriff’s Office said the solvency fix could hurt the ability of sheriff’s offices to hire and retain deputies.
Meanwhile, several lawmakers voiced concern that the measure would deal an economic blow to low-income retirees.
Sen. George Muñoz, D-Gallup, the solvency bill’s sponsor, said changes to the measure will be considered, but added, “This is not a bill where we’re trying to hurt people.”
Attempts in recent years to pass far-reaching pension solvency legislation have been largely unsuccessful, prompting some legislators to question whether the topic will have to be tackled in a special legislative session.
However, a spokesman for Gov. Susana Martinez, who has not unveiled her own pension solvency plan, said that need not occur.
“The governor remains hopeful that we can find common ground and solve the challenges related to our state pensions, and that it can be done this session,” Martinez spokesman Enrique Knell said.
Changes to the PERA solvency plan could also weaken the goal of being fully funded by 2041, Propst said. The pension fund currently has a funded ratio of about 65 percent, meaning it has 65 cents in investments for every $1 in future benefits owed.
— This article appeared on page A3 of the Albuquerque Journal