2010 LEGISLATION IMPACTING ERB
Below is a summary of the 2010 legislative proposals concerning ERB. If you have any questions or need any additional information please contact us at 505-827-8030.
HB231 - Disclosure of Educational Pension Amounts, Rep. Jack E. Thomas (D60)
Status: Passed and Signed by the Governor.
Provides that the only information maintained by the Educational Retirement Board regarding a member or retired member which is open to public inspection is the name of the member, where the member was employed, dates of retirement and reported death, service credit, reported salary, amount of contributions and pension or disability amount. Other information may only be disclosed to the member, the member’s spouse or authorized representative, or persons specifically identified by them in a written consent form.
HB239 - No Educational Retirement Benefit Adjustments, Rep. Rep. Rick Miera (D11)
Status: Passed and Signed by the Governor.
Ensures there will not be a decrease in our retirees’ monthly benefits. Previously Section 22-11-31 (B) of the New Mexico Educational Retirement Act required that decreases in the Consumer Price Index will cause retiree benefits to decrease. Since the Consumer Price Index showed a decrease from 2008 to 2009 the result would have been a -0.4% reduction in a retiree’s monthly benefit. HB239 changed the language to state “Annuities shall not be decreased in the event that there is a decrease in the Consumer Price Index between the next preceding calendar year and the preceding calendar year.” While it is unfortunate that our members will not be receiving a cost of living adjustment increase this year they will not suffer a decrease this year or in the future.
HB241 - Educational Retirement Info Disclosure, Rep. Jack E. Thomas (D60)
Status: Passed in HB231
Provides that the only information maintained by the Educational Retirement Board regarding a member or retired member which is open to public inspection is the name of the member, where the member was employed, dates of retirement and reported death, service credit, reported salary, amount of contributions and pension or disability amount. Other information may only be disclosed to the member, the member’s spouse or authorized representative, or persons specifically identified by them in a written consent form.
SB18 - Changes to State Investment Bodies, Sen. Timothy M. Keller (D17)
Status: Passed and Signed by the Governor.
Modifies the composition of the State Investment Council and amends the powers and duties of the State Investment Officer. Originally the bill included changes to the composition of the Public Employees Retirement Association (PERA) and the Educational Retirement Board (ERB); these agencies were removed from the bill.
SB91 - Delay Educational Retirement Contributions, Sen. John Arthur Smith (D35)
Status: Passed and Signed by the Governor.
Delays the 0.75 percent increase scheduled for FY11 in the employer contributions to the Educational Retirement Board (ERB) by one year. The employer contribution rate for FY11 will remain at 10.90% for employees making $20,000.00 or more and 12.40 percent for employees making less than $20,000.00.
SB164 - Salaries for Educators Returning To Work, Sen. Howie C. Morales (D28)
Status: Did not pass.
Limits the salaries of Educational Retirement Board (ERB) members who return to work (RTW) for local administrative units (LAU) without suspending their pension benefits.
SB246 - Public Employee Pension Contribution Increase, Sen. Stuart Ingle (R27)
Status: Did not pass.
Temporarily increases the public employee contribution to the state retirement funds for FY11 by 1 percent and reduces the employer contribution by the same amount.
SB260 - Alternate Early State Retirement Plans, Sen. Tim Eichenberg (D15)
Status: Did not pass.
Directs multiple state agencies to develop alternative early retirement plans for state employees and higher education participants and report those plans to the Legislative Finance Committee.
SUMMARY OF 2009 LEGISLATION IMPACTING ERB
SB572 - Higher Ed Portability (Alternative Retirement Plan), Sen. Mary Jane Garcia (D36)
STATUS: Passed and Signed; Duplicates HB 525, sponsored by Rep. Chasey (D18)
Present law provides that the state post-secondary educational institution employees who become members of alternative retirement plans may not change plans. Starting July 1, 2009, this bill would allow these employees, if they have made contributions to alternative plans for seven years or more, to have a one-time chance, for 120 days, to become members of the regular retirement plan. Allows for other changes to the alternative plan. Contains emergency clause. The ERB will be drafting rules to implement this legislation and will be issuing requests for proposals for new retirement plans for the alternative retirement plan.
HB573 - Stricter Retirement Provisions for New Employees, Rep. John Heaton (D55)
STATUS: Passed and Signed by the Governor.
Amends the Public Employees Retirement Act and the Educational Retirement Act to establish stricter age and service credit retirement requirements for members employed after July 1, 2010 and covered by the acts. Amends the Retiree Health Care Act to increase employer and employee contributions to the Retiree Health Care Fund for members of enhanced retirement plans, and to require PERA and ERA members who purchase service credit or return to public employment after retirement to make contributions to the fund. Provides for ERA Military Services purchases. Extends the sunset date for the ERB return to work program to 2022 and clarifies requirements for participation in the program. Creates a retirement systems solvency task force of 25 members to study the actuarial soundness of the retirement plans and submit recommendations to the interim Investments and Pension Oversight Committee, the Legislative Finance Committee and the Governor no later than October 1, 2010. HB 573, incorporates the provisions of HB 453 and SB 633 (Purchase of Military Service Credit), HB 721 and SB476 (ERB Retired Employees Return to Work), and HB 631 (Stricter Retirement Rules for new ERA members).
HB631 - Stricter Retirement Rules for New ERA Members, Rep. Rhonda King (D50)
STATUS: Passed in HB573
Adds a section to the Educational Retirement Act to provide that persons who become members on or after July 1, 2010 shall be eligible for retirement: (1) at any age with 30 years of service; (2) at age 67 with five or more years of service credit; or (3) when the sum of the member’s age and years of service credit equals at least 80. Retirement eligibility for persons who were members before July 1, 2010 remains at age 65 with five or more years of service credit, or at any time when the sum of the member’s age and service credit equals at least 75 or 25 years service regardless of age.
HB722 - Educational Retirement Information Confidentiality, Rep. Jack Thomas (D60)
STATUS: Passed and Signed by the Governor Action; Duplicates SB 490, Sen. Fischman (D37)
Provides that the only information maintained by the Educational Retirement Board regarding a member or retired member which is open to public inspection is the name of the member, where the member was employed, dates of retirement and reported death, service credit, reported salary and amount of contributions. Other information may only be disclosed to the member, the member’s spouse or authorized representative, or persons specifically identified by them in a written consent form.
SB399 - Educational Retirement Audits, Sen. Howie Morales (D28)
STATUS: Passed and Signed by the Governor; Duplicates HB 588, Rep. O’Neill (D15)
Authorizes the director of the Educational Retirement Board to audit local school districts and public post-secondary institutions ensure compliance with the Educational Retirement Act and Board rules.
HB453 - Purchase of Military Service Credit, Rep. Miguel Garcia (D14)
STATUS:Passed in HB573
Allows members with more than five years contributory service under the Educational Retirement Act to acquire up to five years additional service credit for prior service in the U. S. military or the commissioned corps of the Public Health Service by making full payment of the member’s average annual salary in the preceding five years multiplied by the sum of the current employer and member contribution rates. The member must make full payment for each year of service to be purchased within 60 days of being informed by ERA of the amount.
HB721 - ERA Retired Employees Return To Work, Rep. Jack Thomas (D60)
STATUS: Amended into HB573
Clarifies requirements for participation in the return to work program and extends the program’s sunset date to 2022.
SB476 - ERA Retired Employees Return To Work, Sen. Gay Kernan (R42)
STATUS: Amended into HB573
In order to continue retirement benefits after beginning employment at a local administrative unit, a retired member must not have rendered service to a local unit for at least 12 consecutive months after the date of retirement. Extends sunset to 2022.
SUMMARY OF 2008 LEGISLATION IMPACTING ERB
HOUSE BILLS:
HB616 - Luciano “Lucky” Varela (D) - Educational Retirement Contributions.
This bill will align the Alternative Retirement Plan (ARP) with Internal Revenue Code (IRC) 401(a) 17.
SENATE BILLS:
SB67 - John Arthur Smith (D) - Retiree Health Care Fund & Members
This bill affects RHCA and may be of interest to ERB's membership.
SUMMARY OF 2007 LEGISLATION IMPACTING ERB
These bills have been introduced. No new bills may be introduced this legislative session. Please go to the legislative web site to see what action, if any, has been taken. Remember that bills do not become law until signed by the Governor.
Click on the blue letters and numbers to read the entire bill
HOUSE BILLS:
HB9 – Luciano “Lucky” Varela (D) – Public Employee Salary Increases
Provides appropriations for funding public officers, and employees, public school personnel and higher education faculty and employees with a 4.25% increase in salary for public education employees and a .75% increase for the employer contribution to the ERB fund.
HB179 – Larry Larranaga (R) – Return to Work for Certain Retirees
For ERB retiree’s beginning the Return to Work program after 7-1-07 a maximum of $25,000 could be earned.
HB221 - Luciano “Lucky” Varela (D) – Payment Obligations of State Pension Systems
In a pension having benefits from both ERA and PERA each system would separately pay the retiree.
HB313 – John A. Heaton (D) – Certain Retirees Returning to Work
For Return to Work applicants between 7-1-07 and 7-1-09 the local administrative unit must adopt a resolution declaring that the employment of the retired member will fill a critical need of the local administrative unit. (same as SB 310)
HB 1091 – Mimi Stewart (D) – Increase the Retirement Benefit and Change the Calculation of the Average Annual Salary
Increases the multiplier from 2.35 to 2.4% for calendar year 2008, 2.45% for calendar year 2009, and 2.5% after 1-1-2010. Changes the final average salary from the high 5 to the highest consecutive 3 years effective as of 1-1-08.
SENATE BILLS:
SB184 – John Arthur Smith (D) – Return to Employment for Certain Retirees
The ERA Return to Work program would not be open to new applicants after June 30, 2008.
SB310 – Phil A. Griego (D) – Certain Retirees Returning to Work
For Return to Work applicants between 7-1-07 and 7-1-09 the local administrative unit must adopt a resolution declaring that the employment of the retired member will fill a critical need of the local administrative unit. (Same as HB313)
The Education Committee amended the bill on February 23 so that there is no reference to ERB’s Return to Work program.
SB1150 – Pete Campos (D) – Average 7% Salary Increase for teachers and education-related Staff
Provides for an average 7% salary increase for all teachers and education related staff throughout the state including public, public-postsecondary, teachers working in other departments, and public education transportation employees. The bill appropriates $197,213,458 from the general fund. The salary increase would increase the unfunded liability of ERB.
SB1162 – Stuart Ingle (D) – Changing the Composition and Appointing Authority fo the Educational Retirement Board
Changes one member of the board from being elected by the New Mexico members of the American Association of University Professors to a chief financial officer of a four-year institution of higher education appointed by the governor.
The Senate Education committee passed as amended. The amendment changes the bill so that the position would be elected by the members of the Council of University Presidents for a 4 year term.
SJM6 – John Arthur Smith (D) – Benefit Enhancement Bill Moratorium
Requests that no bills be introduced to enhance pension benefits for the next two years.
SUMMARY OF 2006 LEGISLATION IMPACTING ERB
The following is a list of bills and memorials that concern The Educational Retirement Board. Also included is whether or not the bill or memorial was passed. You may click on the bill number in order to access the link to the bill on the NM Legislative Website.
HOUSE BILLS
HB 3 – Education Appropriation Act - Rick Miera
Identical to the appropriation for Public Education as described in the General Appropriation Act of 2006. Increases the state equalization guarantee from the 2005 act by $158,900,600 to $2,122,727,400. Defines the performance standards to be achieved through the 2006-2007 school year. Provides for an average four and one-half percent salary increase for all teachers and instructional staff, and a $45,000 minimum annual salary for level 3-A teachers. Increases employer contribution to the educational retirement fund by three-fourths percent.
HB 78 - State Employee Salary Increases - Luciano “Lucky” Varela
Provides $35,686,504 (GF) to DFA for salary increases to state employees.
HB 100 - Restrict Public Employees Returning to Work - Larry A. Larranaga
(For the State Permanent Fund Task Force and the Legislative Finance Committee) Provides that if a PERA member retires and is subsequently reemployed by an affiliated public employer on or after July 1, 2006, that person’s pension would be suspended the first month following the point at which his reemployment earnings exceed $15,000 for a calendar year. A retired member who returns to work before July 1, 2006, would be entitled to receive full retirement benefits as well as full pay for his new job.
HB 212 - State Retirement System Oversight Committee - John A. Heaton
Creates the State Investment and Retirement Systems Oversight Committee as a joint interim legislative committee. Consists of five voting members from each legislative house and five nonvoting members; one each from the State Investment Office, PERA, Secretary of Finance and Administration, State Treasurer’s office and the Educational Retirement Board. Mandates the new committee to create a plan for oversight of the retirement fund activities of the organizations represented by the five nonvoting members. Provides for the continuing analysis of the financial status of those funds and development of recommendations for improved investment practices to ensure the financial soundness of those funds. Requests that all future legislation affecting state investment practices, the permanent funds or the retirement funds be presented to the committee for review and analysis prior to the session in which that legislation will be introduced. Provides an appropriation of $150,000 to the Legislative Council Service for technical and legal assistance to the committee through the end of fiscal year 2007.
HB 222 - Expand Educational Retirement Board Members - Luciano “Lucky” Varela
(For the State Permanent Fund Task Force and the Legislative Finance Committee) Increases the size of the Educational Retirement Board to 10 members from seven members.
HB 446 - Forfeiture of Retirement Benefits for Crimes - Al Park
(HEM66) If it appears to a New Mexico prosecutor that a felony defendant is a current or retired state employee and that the charge is related to the defendant’s past or present employment, the prosecutor must initiate the forfeiture of a state system pension. The requirement also applies to a felony conviction in federal or another state court.
HB 461 - Public Employees Benefits Oversight Committee - Ben Lujan
(For the Public Employee Benefits Oversight Subcommittee) Creates the joint interim Committee for the Oversight of Public Employee Benefits, Programs and Funds to function until December 1, 2008. Make up would be three House members appointed by the speaker, and three from the Senate appointed by the Committees' Committee with party representation proportionate to the membership of the two bodies.
SENATE BILLS
SB 23 - Contributions to Investors of Public Funds - Stuart Ingle
Makes it unlawful for the governor, lieutenant governor, state treasurer, state auditor, secretary of state, attorney general, land commissioner, state legislator or a candidate for those offices to solicit or accept anything of value from an investment agent doing business with the state.
SB 130 - Expand Educational Retirement Board Members - John Arthur Smith
(For the State Permanent Fund Task Force and the Legislative Finance Committee) Increases board membership from seven to 10. All new members must possess at least 10 years of investment or public finance experience. One member will be appointed by the governor. A second member with be appointed by the University Presidents’ Council and the third member will be appointed by the New Mexico Coalition of School Administrators. All new members will serve four-year terms and any unexpired term will be filled with a selection by the original appointing authority.
SB 206 - Adjust Educational Retirement Eligibility - John Arthur Smith
(For the State Permanent Fund Task Force) Retirement benefits from the Educational Retirement Act are available to a person becoming a member prior to July 1, 2006, when the sum of the member’s age and years of earned service equals 75. For a person becoming a member on or after July 1, 2006, the sum of the member’s age and years of earned service equals 80. The same formulation applies to members who terminate employment prior to retirement but do not withdraw contributions that have been made.
SB 300 - Restrict Public Employees Returning to Work - John Arthur Smith
(For the State Permanent Fund Task Force and the Legislative Finance Committee) (Identical to HB100) Same as HB100. Provides that if a PERA member retires and is subsequently reemployed by an affiliated public employer on or after July 1, 2006 that person’s pension would be suspended the first month following the point at which his reemployment earnings exceed $15,000 for a calendar year. A retired member who returns to work before July 1, 2006 would be entitled to receive full retirement benefits as well as full pay for his new job.
SB 528 - Frontier Teacher Act - Leonard Tsosie
The act adds a new measure of student achievement by requiring a student-specific assessment of grade-level attainment in mathematics, English and literacy in the first and final months of a grade-level.
SB 541 - Increase Educational Retirement Contributions - Sue Wilson Beffort
Increases member contributions to the Educational Retirement Association Fund as follows: FY 2007, from 7.75 percent to 7.8 percent; FY 2008, from 7.825 percent to 8.2 percent; on or after July 1, 2008, from 7.9 percent to 8.6 percent.
