SENATE COMMITTEE ON GENERAL GOVERNMENT

 

 

March 12, 2003                                                                                                       Hearing Room B

3:00 p.m.                                                                                                                         Tapes 21-22

 

MEMBERS PRESENT:         Sen. Tony Corcoran, Chair

Sen. John Minnis, Vice-Chair

Sen. Bruce Starr

Sen. Vicki Walker

 

STAFF PRESENT:                 Mark Ellsworth, Committee Administrator

Heather Gravelle, Committee Assistant

 

MEASURE/ISSUES HEARD:           HB 2004A – Public Hearing

 

These minutes are in compliance with Senate and House Rules.  Only text enclosed in quotation marks reports a speaker’s exact words.  For complete contents, please refer to the tapes.

 

TAPE/#

Speaker

Comments

TAPE 21, A

005

Chair Corcoran

Calls meeting to order at 3:00 p.m. Opens public hearing on HB 2004A.

HB 2004A – PUBLIC HEARING

008

Mark Ellsworth

Committee Administrator. Provides overview of HB 2004A.

010

Rep. Tim Knopp

District 54. Testifies in support of HB 2004A. Explains history and states the outcome isn’t quite as it was understood to be.

070

Rep. Knopp

Adds the amendments don’t reflect a substantial difference. Clarifies the new section will expedite the process.

075

Rep. Greg Macpherson

District 38. Testifies in support of HB 2004A. Urges adoption of the -13 amendments. Explains position and how the bill was designed. States the goal is to update the mortality tables to establish an account balance.

100

Rep. Macpherson

Clarifies the amendments are appropriate; the effect of the look back would be an assurance which would be extended to all the optional forms of benefits. Adds the proposed fiscal analysis was based on the understanding it would apply to all optional forms of benefits.

120

Chair Corcoran

Asks if Rep. Macpherson concurs with Rep Knopp’s assumption that the amendments would expedite the review process.

125

Rep. Macpherson

Comments it would be the right direction.

150

Dave Hendricks

Legislative Counsel. Explains HB 2004A. Provides an overview and history.

180

Hendricks

States what changes are in the amendments. Adds when the mortality tables will go into effect. Explains all aspects which may affect the Individual benefits.

250

Hendricks

Explains how the calculations are figured and the determination of benefits. States the look back applies for people who retire in the next two years.

315

Chair Corcoran

Asks for clarification on benefits and access to look back.

320

Hendricks

Answers and clarifies the look back process again.

335

Sen. Minnis

Mentions current mortality tables, and assumptions. States he would like to see graphs or other visual aids as examples.

385

Jim Voytko

Executive Director, PERS. Responds and clarifies he could produce graphs and other visual aids to have available at the next meeting.

440

Chair Corcoran

Asks for recommendation of who would do the fiscal estimate of the look back.

470

Voytko

Responds and offers recommendation.

TAPE 22, A

005

Sen. Minnis

Asks if there have been any fiscal assumptions.

010

Voytko

Responds and states they can produce the fiscal assumption developed in the House side.

030

Sen. Minnis

Inquires how many people are estimated to retire.

035

Voytko

Responds 5,100 people will retire by the end of 2003.

055

Pat West

President of Oregon Fire Fighters Council, PERS Coalition. Provides written testimony (EXHIBIT A). Testifies in opposition to HB 2004A. Explains position and comments he would like to change the implementation dates.

080

West

Clarifies further why he is opposed to HB 2004A. Mentions problems with HB 2004A as it is currently written. Specifies key problem is the old actuary tables would not be used. States assumed intention and what the consequences of passing HB 2004A would be. Mentions survivor benefits.

125

Beth Anne Darby

PERS Coalition. Testifies against HB 2004A. Explains position. Advises the accrued benefits theory has not been tested. Adds HB 2004A supports a theory rejected by the PERS board. Mentions what should be included and provides examples.

180

Darby

Points out specific issues. Further explains the language needs to be amended, and states what it should be changed to.

190

Bill Gary

Attorney. Testifies in support of HB 2004A. Explains position and provides examples. States the Board currently utilizes outdated mortality tables. Describes on average, people are living four years longer, and benefits are higher if the correct mortality tables were being utilized. States the consequences if HB 2004A should not be implemented.

TAPE 21, B

025

Chair Corcoran

Emphasizes he expects a joint amendment.

030

Gary

Answers they will identify where there is agreement and disagreement and will attempt to develop a resolution.

035

Chair Corcoran

Explains why he is asking, and mentions time pressures.

085

Chair Corcoran

Asks if Gary understands the impact of the amendments as explained by LC and as reviewed by Rep. Knopp and PERS representatives.

090

Gary

States he does understand.

145

Tricia Smith

Oregon School Employees Association. Testifies in opposition of HB 2004A. Provides written testimony (EXHIBIT B).Explains position. States which is the correct method, adds it will save money in the future. Remains willing to utilize the look back approach. Feels HB 2004 violates members contracts explains how and gives specific examples

205

Chair Corcoran

Asks for clarification on the violations of contracts.

210

Smith

Clarifies issue.

215

Smith

States it’s not a good idea to have the issue resolved at the supreme court level. Feels it must be settled by the legislature.

235

Sen. Minnis

Cites ORS current law, and asks what part is unclear.

240

Smith

Mentions experience in PERS arena, states fear of diminishing benefits of members.

250

Sen. Minnis

Clarifies original question.

255

Smith

Refer to the memo.

260

Sen. Minnis

Clarifies again, explains position. Mentions Lipscomb decision, adds the board disregarded the statute. Declares the law is the contract.

285

Sen. Starr

Agrees with Sen. Minnis.

325

Chair Corcoran

Expresses they have not seen the Attorney Generals opinion yet.

365

Brian Delashmutt

Oregon Correctional Employees Association. Mentions public safety officers historically have been receiving fewer benefits than others. States he will be providing a study on the issue.

TAPE 22, B

010

Sen. Minnis

Inquires if the majority is retiring younger.

020

Brian Delashmutt

Responds and gives examples. Describes the calculations utilized and the money match system.

035

Ed Johnston

Member of the Public. Comments the state retirement system is not fair, adds 60% on average would be fair.

045

Chair Corcoran

Closes public hearing on HB 2004A. Adjourns meeting at 4:55 p.m.

The following prepared testimony is submitted for the record without public testimony for HB 2004A.

                      Michelle Deister            Submits written testimony (EXHIBIT C).

 

 

 

EXHIBIT SUMMARY

 

A – HB 2004A, written testimony, Pat West, 21 pp

B – HB 2004A, written testimony, Tricia Smith, 2 pp

C – HB 2004A, written testimony, Michelle Deister, 1 p