|Posted:||March 26, 2015 09:31 AM|
|From:||Representative Scott A. Petri|
|To:||All House members|
|Subject:||Municipal Pension Repayment Legislation|
|Municipal pension debt is an issue across the state and according to the Auditor General’s report from January 2015, 22 municipal pensions are classified as severely distressed under Act 205 (less than 50% funded). The Auditor General’s report estimates that there is approximately $7.7 billion dollars in unfunded liability; the 22 severely distressed pensions owe a combined total of $5.5 billion in unfunded liability. My legislation specifically targets these 22 severely distressed pension plans and requires them to begin making meaningful steps to increase the amount of funds that they put in their pension plans and helping move them towards a more fiscally stable position.
My legislation would create a new chapter in Act 205 that would require all severely distressed pensions to develop a plan which would move them from severely to moderately distressed over a maximum of 10 years. Any plan created would have to be approved by PERC and the municipality would have to show compliance. To make sure a municipality complies and makes an effort to improve their financial status, PERC would have the authority petition the court to have the Auditor General’s office take control of the distressed pension and place it in trusteeship.
This legislation would be an important first step in helping solve the unfunded liability problems across the state. I hope you will join me in sponsoring this important piece of legislation.
Introduced as HB974