Legislative Session Results in Few Statutory Changes Directly Affecting Members

The 2008 Missouri Legislative Session ended Friday, May 16 with no revisions to PSRS/PEERS statutory language. Only two bills passed that may have an impact on PSRS/PEERS members:

During the December 2007 Board meeting, the Board of Trustees unanimously passed a resolution stating that any legislation proposing benefit improvements which would have a cost to the members and school districts would be opposed until the System is fully funded or until the contribution rate is stabilized. As of June 30, 2007, the System was approximately 83% pre-funded. While our combined assets exceed $31 billion, we also have an unfunded actuarial accrued liability (UAAL) of over $5 billion. As a result, our members and school districts have seen their contribution rates rise over the last few years and, due to the recent volatility in the investment market, the increases may not be over.

The PSRS/PEERS Board of Trustees and management are dedicated to providing the promised retirement benefits not only to current retirees but to future generations of retirees. As the law and fiduciary responsibility requires, it’s important for all our members that the current benefit promises are adequately funded before seeking new benefit increases.

Several bills were introduced which did have a cost to the Systems, but ultimately were not passed.

While this proposal had no actuarial cost to the Systems, it could have created an administrative burden for our school districts and our staff, and might have resulted in a legal challenge based on the fact that it does not treat similarly-situated employees in the same manner. This language did not pass.

The System introduced several provisions this session which would have allowed us to operate more effectively and efficiently. These provisions were combined into an omnibus retirement bill which was not passed.

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	Legislative Session Results in Few Statutory Changes Directly Affecting Members The 2008 Missouri Legislative Session ended Friday, May 16 with no revisions to PSRS/PEERS statutory language. Only two bills passed that may have an impact on PSRS/PEERS members: SB 1066 creates an alternative method of obtaining teacher certification from the State Board of Education. An individual may obtain teacher certification by obtaining certification from the American Board for Certification of Teacher Excellence (ABCTE) and verification of ability to work with children by completing 60 contact-hours in the classroom as described in the act. SS HB 1678 changes the laws regarding members of the military and their families. Requires the state board of education to establish a rule to allow the issuance of a provisional teacher’s certificate before the completion of a background check to the spouse of a military member who holds a teacher’s certificate in another state that requires a background check and who has relocated within the last year. During the December 2007 Board meeting, the Board of Trustees unanimously passed a resolution stating that any legislation proposing benefit improvements which would have a cost to the members and school districts would be opposed until the System is fully funded or until the contribution rate is stabilized. As of June 30, 2007, the System was approximately 83% pre-funded. While our combined assets exceed $31 billion, we also have an unfunded actuarial accrued liability (UAAL) of over $5 billion. As a result, our members and school districts have seen their contribution rates rise over the last few years and, due to the recent volatility in the investment market, the increases may not be over. The PSRS/PEERS Board of Trustees and management are dedicated to providing the promised retirement benefits not only to current retirees but to future generations of retirees. As the law and fiduciary responsibility requires, it’s important for all our members that the current benefit promises are adequately funded before seeking new benefit increases. Several bills were introduced which did have a cost to the Systems, but ultimately were not passed. The Missouri Retired Teachers Association (MRTA) worked with several members of the legislature on a bill that would have provided a temporary benefit increase only for those retirees that had reached their COLA cap and were 75 years of age or older. This temporary benefit increase had an estimated cost to the Systems of $16.9 million, which would likely have resulted in higher contribution rates for our active members. While we are sympathetic to the retirees who have reached the COLA cap, the Board of Trustees opposed this legislation due to the increased cost to our active members. This provision did not pass. Several bills contained a provision which would have impacted the final average salary calculation for PSRS members. Under the proposal, superintendents and other central office personnel would have been limited to a 10% increase in pay from one year to the next during their final average salary period. Other members of PSRS would be limited to a 20% increase. While this proposal had no actuarial cost to the Systems, it could have created an administrative burden for our school districts and our staff, and might have resulted in a legal challenge based on the fact that it does not treat similarly-situated employees in the same manner. This language did not pass. The System introduced several provisions this session which would have allowed us to operate more effectively and efficiently. These provisions were combined into an omnibus retirement bill which was not passed.