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Wednesday, March 12, 2003

Committee OKs Higher Benefits

By Loie Fecteau
Journal Politics Writer
    SANTA FE A Senate-passed plan to beef up the retirement benefits of current and former legislators breezed through its first House committee with no opposition Tuesday.
    "This is the choir here," Rep. Mimi Stewart, D-Albuquerque, who chairs the House Government and Urban Affairs Committee, told Senate Minority Leader Stuart Ingle, R-Portales, the sponsor of the measure (SB 620).
    "I think this has been very well thought out," Stewart said of the retirement plan for legislators, which was sent on to the House Appropriations and Finance Committee for consideration.
    "If we pass it though, I want wide bipartisan support," Stewart said.
    Meanwhile, Gov. Bill Richardson said he is skeptical about the plan to significantly boost legislative retirement benefits by tapping uncollected taxes on out-of-state residents who receive royalties from oil and gas interests in New Mexico.
    "I want to be sure that taxpayers are protected and that we understand the full financial impact of this," Richardson said.
    Stewart and other committee members said the public often doesn't realize how hard New Mexico's part-time, unsalaried "citizen" Legislature works and that the increased benefits are justified.
    "Folks don't understand what legislators do," said Rep. W.C. "Dub" Williams, R-Glencoe.
    Rep. Fred Luna, D-Los Lunas, who has served in the House since 1971, said a number of legislators "have lost their families just by being here."
    Under the plan, a new formula would increase the annual retirement benefit of current legislators to $1,044, times the number of years of service. So, a legislator who served 20 years could receive $20,880 a year in retirement benefits. A legislator would have to contribute $500 a year for each year of service, up from $100 a year, to participate.
    Former legislators, who had retired after 20 years, could receive $10,000 a year under a separate formula. They would have to retroactively pay an additional $100 for each year of service to receive the increased benefit.
    Presently, legislators who have served 20 years are eligible to receive $5,000 a year in retirement benefits if they contribute $100 a year for each year of service.
    Ingle estimated the legislative retirement plan would cost between $2 million and $3 million a year. It would be paid for, under a companion bill (committee substitute SB 621), by requiring companies that pay oil and gas royalties to out-of-state residents to withhold tax charges of 6.75 percent, much of which goes uncollected now, Ingle said.
    "This will save the General Fund between $600,000 and $700,000, which is what the General Fund is paying now into our retirement system," Ingle said.