With their pension fund swimming in cash, state legislators are considering helping out some friends in need.
Under a bill pending in the Legislature, $3.6 million in scheduled government contributions to the legislative pension fund would be redirected to the pension funds for judges and magistrates.
“We’re over-funded, and they need the money,” said Senate Minority Leader Stuart Ingle, R-Portales, a co-sponsor of the bipartisan bill to shift the money over three years.
At the end of the 2013 fiscal year on June 30, the legislative pension plan had assets valued at $28.9 million but liabilities of just $25.1 million, according to an actuarial valuation. That means the plan was funded at 115 percent of liabilities.
By comparison, as of June 30, the pension plan for judges was 56 percent funded, with an unfunded liability of $63.7 million. The pension plan for magistrates was 58 percent funded, with an unfunded liability of $22.7 million.
Every year, the state pumps $2.4 million into the pension plan for legislators, with the money coming from a fund of various government fees and taxes.
Under the bill co-sponsored by Ingle, the state’s contribution to the plan would be cut in half, to $1.2 million, for each of the next three years, and the other $1.2 million would go to the pension plans for judges and magistrates.
The diversion of the $3.6 million to the pension plans for judges and magistrates is contingent upon enactment into law of broader legislation to shore up the retirement programs.
Under pending bills, judges and magistrates would contribute 3 percent more of their salaries to their pension plans. The state would kick in 3 percent more of salaries for judges and 4 percent more for magistrates.
Also, cost-of-living increases would be suspended for two years and judges would have to work longer to receive full pensions. Magistrates would also have to work longer, on average.
The legislation to redirect the $3.6 million to the pension funds for the judges and magistrates was pending before the Senate Finance Committee on Thursday, one week before the end of the legislative session.
The Legislature approved legislation last year to reform the pension plans for judges and magistrates, but it was vetoed by Gov. Susana Martinez, who said the changes weren’t serious enough and relied too heavily on increased contributions from the state.
More pension bills
Also introduced by Ingle is a bill to increase from $600 to $750 the annual contribution that each participating legislator must make to the legislative pension plan.
Ingle said the increase is warranted, given the benefits retired lawmakers receive.
“We’ll never pay in what we get out of it,” he said.
He won’t get any argument from Martinez, who repeatedly has said the contributions to the pension plan by lawmakers are “woefully inadequate” when compared with the retirement benefits they generate.
Under the pension plan, a retired legislator receives about $1,000 annually for each year served in the Legislature, meaning a legislator more than recovers his contributions to the plan in just the first year of retirement.
A minimum of five years of service in the Legislature is needed to collect a benefit. A former legislator who served 10 or more years can draw a pension at any age.
Sen. Jacob Candelaria, D-Albuquerque, has introduced a bill to set 55 as a minimum age for former legislators to collect benefits, saying the public recognizes the pension plan as “too good a deal.”
The bills introduced by Ingle and Candelaria hadn’t gotten any traction with a week to go in the legislative session. As of Thursday, neither had even gotten a committee hearing.
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