– Chairman of the House State Government Committee, Rep. Garth Everett (R-Lycoming/Union), announced the passage of three major public pension reform bills out of committee.
“This week, the State Government Committee approved legislation aimed at addressing the underfunded pension crisis in Pennsylvania,” said Everett. “The bills we passed, which now must be taken up the by the full House, would implement oversight measures, budget planning requirements for employers, independent auditing and stricter standards for SERS and PSERS board members,” said Everett.
The legislation includes:
• House Bill 1960
proposes to consolidate the investment offices of the State Employees’ Retirement System (SERS) and the Public School Employees’ Retirement System (PSERS) and establish an oversight mechanism composed of highly experienced and qualified investment experts.
• House Bill 1982
would give the option to any SERS employer to pre-fund. The pre-funding of accrued liability would allow employers to better control and plan for future costs.
• House Bill 1996
proposes to amend the State Employees Retirement Code and the Pubic School Employees Retirement Code to require the boards of SERS and PSERS to do the following:
o Establish independent boards and committees, including:
? An independent audit committee.
? An Asset Liability Contingency Operating Committee.
? An executive committee.
o Impose term limits on the number of terms both boards’ members may serve.
o Expands the current annual training requirements of both boards’ members.
“House Bill 1960 took recommendations from a series of testimonies from representatives of states with consolidated investment offices,” said Everett. “Our Commonwealth’s fiscal health unfortunately is ranked lower than others mostly due to our pension crisis. This legislation would go a long way in modernizing the way we fund our state pension system.”
“Another possible pension reform, House Bill 1982, would simply allow employers to refinance their debt,” Everett added. “This is a positive step towards better planning for future costs of employers that would immensely improve the health and stability of the state-wide pension system.”
“To address a lack of oversight and improve public accountability, House Bill 1996 would make the SERS and PSERS boards more democratic and subject to the citizens,” said Everett.
“I urge the House to consider the fact that we have a $75 billion debt shortfall, $65 billion of which comes from unfunded retirement benefits and future healthcare benefits for retirees,” said Everett. “When you break it down, each taxpayer is on the hook for $17,100.
That’s unacceptable and it shows why these bills are necessary. Now more than ever it is time for pension reform.”
Representative Garth D. Everett
Pennsylvania House of Representatives
Media Contact: Alison Haas