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House Co-Sponsorship Memoranda
House of Representatives
Session of 2015 - 2016
Regular Session
MEMORANDUM
| Posted: | February 4, 2015 03:01 PM |
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| From: | Representative Peter J. Daley |
| To: | All House members |
| Subject: | Reintroducation of Early Retirement legislation |
| In the near future, I plan to reintroduce legislation that would provide incentives for early retirement for public school employees and state employees at no net cost to the State Employees Retirement System (SERS) or Public School Employees Retirement System (PSERS) pension funds or General Fund. The estimates are in the billions of dollars for our underfunded pension liabilities, and once again to start this legislative session, we will hear this issue spoken of by constituents, news media, and from one another until we can do something to make long term fixes to the problem. One realistic cost-savings solution that has been proven by private industry time and again are early retirements – funded with the net savings generated – that produce long-term cost reductions at the bottom line. This approach could create as many as 10,000 new jobs for young teachers, and up to 4,000 new entry-level state jobs. Replacing a teacher at the top of the pay scale with an entry level teacher saves $20,000 to $30,000 per year, a saving that continues for a number of years. Additionally, all benefits that are calculated on salary (Unemployment, Social Security, etc) are reduced as well. Past early retirements have left that entire net savings on the table for school districts. By recapturing 60% of those net savings – and leaving 40% on the table for school districts – we can return those savings to the pension funds to pay for the cost of an early retirement. The second bill would be the similar approach for state employees. I am aware of the current financial difficulties of our two pension funds. While this solution is not the end all fix, it places no additional burden on them, it gets new people working and contributing into the respective systems, and it saves both schools and state agencies money by not having to pay the higher commanding salaries of tenured employees. Private industry can do this, and so can we. Both bills will define eligibility as either 30 years’ service, or age plus service equal to 80. The recapture of savings lasts for five years, the time of both greatest cost and greatest cost savings. I am currently reviewing options for the limited window to be provided for in both bills. If you have any specific questions, please do not hesitate to contact my office. Last session, I received close to 1000 email and phone calls from teachers and state employees from every corner of the Commonwealth urging me to continue pushing for this legislation and throwing their support behind it. I hope I can count on yours as well. |
Document #1
Introduced as HB861
| Description: | If you wish to cosponsor the early retirement for public school teachers, please click below. | |
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Document #2
Introduced as HB862
| Description: | If you wish to cosponsor the early retirement for state employees, please click below. | |
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