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SANTA FE – New Mexico’s ailing public retirement systems took center stage at the state Capitol on Wednesday, with union leaders and top lawmakers calling for solvency legislation to be passed during the current 60-day legislative session.
Bills to shore up the state’s two public retirement systems – the Public Employees Retirement Association and the Educational Retirement Board – have been introduced at the Roundhouse, and House and Senate members received a primer on the proposals Wednesday.
With a House committee scheduled to hold its first hearing on a teacher pension fund solvency bill today, some lawmakers warned that the debate is just beginning.
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Pension bills in the Roundhouse HB 64 SPONSOR Rep. Mimi Stewart, D-Albuquerque SPONSOR Sen. Stuart Ingle, R-Portales SPONSOR Sen. George Muñoz, D-Gallup SPONSOR Sen. Sue Wilson Beffort, R-Sandia Park SPONSOR Sen. Clemente Sanchez, D-Grants |
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“There was a lot of optimism in the room today, but it’s a long and tedious process,” said Rep. Zach Cook, R-Ruidoso.
The financial conditions of both PERA and ERB have worsened in recent years, due to a combination of market-driven investment losses, longer life expectancy and other factors.
The two pension funds, which each use different formulas for determining retirement eligibility and benefits, have a combined unfunded liability of $12.4 billion under their most recent accounting. That figure represents the difference between future retirement benefits owed and assets on hand.
Senate President Pro Tem Mary Kay Papen, D-Las Cruces, said the two retirement systems should not be pitted against each other in the Legislature.
“We can’t play favorites,” Papen told the Journal. “Each one needs to be fixed.”
Separate solvency proposals for the pension funds, which were approved by the respective retirement systems’ boards last year, were laid out Wednesday in advance of the looming legislative debate.
The PERA plan calls for retirement benefits to be scaled back for retirees, future employees and current government workers covered by the retirement system. It also would increase the amounts of money that both employees and their government employers, via taxpayer dollars, pay into the retirement fund and impose stricter retirement eligibility on future workers.
PERA covers more than 55,000 government workers, including police officers, judges and legislators, while providing benefits to roughly 31,000 retirees.
Meanwhile, the ERB plan also calls for both employee and taxpayer-funded contributions to rise starting in July. However, changes such as a new minimum retirement age of 55 and deferred start dates for certain retirement benefits would only apply to future workers.
The ERB has more than 60,000 active members, in addition to about 37,000 retirees.
Union leaders spoke in favor of both plans Wednesday, saying public employees are willing to pay more to preserve their retirement benefit packages. public retirement systems
— This article appeared on page A6 of the Albuquerque Journal
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