Legislature(1995 - 1996)

1995-05-02 Senate Journal

Full Journal pdf

1995-05-02                     Senate Journal                      Page 1422
SB 148                                                                       
SENATE BILL NO. 148 "An Act relating to a defined contribution                 
retirement plan for state employees" which had been placed at the              
bottom of the calendar (page 1408) was read the second time.                   
                                                                               
Fiscal notes published today from Department of Administration (2).            
                                                                               
Senator Duncan rose to a point of order regarding AS 24.08.036.                
                                                                               
President Pearce ruled that Senator Duncan's point was not well                
taken.                                                                         
                                                                               
Senator Duncan appealed the ruling of the Chair.                               
                                                                               
The question being: "Shall the ruling of the Chair be upheld?"  The            
roll was taken with the following result:                                      
                                                                               
                                                                               

1995-05-02                     Senate Journal                      Page 1423
SB 148                                                                       
                                                                               
SB 148                                                                         
Uphold ruling of the Chair                                                     
                                                                               
YEAS:  12   NAYS:  8   EXCUSED:  0   ABSENT:  0                              
                                                                               
Yeas:  Frank, Green, Halford, Kelly, Leman, Miller, Pearce,                    
R.Phillips, Rieger, Sharp, Taylor, Torgerson                                   
                                                                               
Nays:  Adams, Donley, Duncan, Ellis, Hoffman, Lincoln, Salo,                   
Zharoff                                                                        
                                                                               
and so, the ruling of the chair was upheld.                                    
                                                                               
Senator Duncan moved that the bill be returned to the Finance                  
Committee.  Objections were heard.                                             
                                                                               
Senator Halford rose to a point of order.  President Pearce cautioned          
members to confine debate to the motion.                                       
                                                                               
The question being: "Shall the bill be returned to the Finance                 
Committee?"  The roll was taken with the following result:                     
                                                                               
SB 148                                                                         
Return to Senate Finance Committee                                             
                                                                               
YEAS:  8   NAYS:  12   EXCUSED:  0   ABSENT:  0                              
                                                                               
Yeas:  Adams, Donley, Duncan, Ellis, Hoffman, Lincoln, Salo,                   
Zharoff                                                                        
                                                                               
Nays:  Frank, Green, Halford, Kelly, Leman, Miller, Pearce,                    
R.Phillips, Rieger, Sharp, Taylor, Torgerson                                   
                                                                               
and so, the bill was not returned to the Finance Committee.                    
                                                                               
Senator Miller moved and asked unanimous consent for the adoption              
of the Rules Committee Substitute offered on page 1407.  Senator               
Duncan objected.                                                               
                                                                               
                                                                               

1995-05-02                     Senate Journal                      Page 1424
SB 148                                                                       
The question being: "Shall the Rules Committee Substitute be                   
adopted?"  The roll was taken with the following result:                       
                                                                               
SB 148                                                                         
Second Reading                                                                 
Adopt Rules Committee Substitute?                                              
                                                                               
YEAS:  12   NAYS:  8   EXCUSED:  0   ABSENT:  0                              
                                                                               
Yeas:  Frank, Green, Halford, Kelly, Leman, Miller, Pearce,                    
R.Phillips, Rieger, Sharp, Taylor, Torgerson                                   
                                                                               
Nays:  Adams, Donley, Duncan, Ellis, Hoffman, Lincoln, Salo,                   
Zharoff                                                                        
                                                                               
and so, CS FOR SENATE BILL NO. 148(RLS) "An Act relating to                    
contributions and benefits in the teachers' retirement system and in           
the public employees' retirement system; relating to retirement                
incentive programs for the public employees' retirement system, the            
judicial retirement system, and the teachers' retirement system;               
relating to separation incentives for certain state employees; repealing       
a provision permitting the National Education Association to                   
participate in the teachers' retirement system; and providing for an           
effective date" was adopted and read the second time.                          
                                                                               
Senator Duncan offered Amendment No. 1:                                        
                                                                               
Page 1, line 1, through page 27, line 28:                                      
	Delete all material and insert:                                               
""An Act relating to retirement incentive programs for the public           
employees' retirement system, the judicial retirement system, and              
the teachers' retirement system; relating to separation incentives             
for certain state employees; and providing for an effective date."             
                                                                               
BE IT ENACTED BY THE LEGISLATURE OF THE STATE                                  
OF ALASKA:                                                                    
   * Section 1.  FINDINGS AND PURPOSE.  The State of Alaska                  
and many local governments and school districts are facing the need            
to restructure their operations and their work forces in order to              
reduce  expenditures and balance budgets.  Retirement and separation           
                                                                               
                                                                               

1995-05-02                     Senate Journal                      Page 1425
SB 148                                                                       
incentives are management tools that have been used extensively by             
the private sector, the federal government, and other state and local          
governments across the country.  The purpose of this Act is to make            
these management tools temporarily available to the state and to the           
municipalities and school districts of the state.  This Act will enable        
these entities to be more efficient and cost-effective by eliminating          
certain nonessential positions, and producing a net reduction in               
personnel costs.                                                               
   * Sec. 2.  RETIREMENT INCENTIVE PROGRAM.  (a)  An                         
employer may adopt a retirement incentive plan under secs.3 - 6 of             
this Act, as appropriate, and designate categories of employees                
eligible to participate in that plan.  An employer need not extend the         
incentive plan to all employees who would otherwise be eligible, but           
may choose to extend the plan only to employees                                
		(1)  in specific budget or administrative components                         
of the employer;                                                               
		(2)  in specific job classifications;                                        
		(3)  in specific geographic locations; or                                    
		(4)  on the basis of any combination of factors                              
under (1) - (3) of this subsection.                                            
(b)  An employee is eligible to participate in a retirement                    
incentive plan under this Act only if the                                      
		(1)  employee is a vested member of the public                               
employees' retirement system or the teachers' retirement system;               
		(2)  employee will be qualified to retire under                              
AS14.25.110 or AS39.35.370 after receipt of the credit described               
in (f) of this section;                                                        
		(3)  savings to the employer in personal services                            
costs for the employee's position will exceed the costs to the                 
employer for that position within three years after the employee is            
appointed to retirement.                                                       
(c)  An employer shall file its proposed retirement incentive                  
plan with the commissioner of administration.  The commissioner                
shall approve the plan if the plan meets the requirements of this Act,         
except that the commissioner may approve a state agency's                      
retirement incentive plan only if the office of management and                 
budget approves the calculation of savings under (b)(3) of this                
section.  A proposed plan filed under this section must                        
(1)  identify job classifications of employees, and                            
specific budget or administrative components, eligible to participate          
in the plan;                                                                   

1995-05-02                     Senate Journal                      Page 1426
SB 148                                                                       
(2)  include a reimbursement agreement that                                    
(A)  requires the employer, for each                                          
employee who retires under the plan, to reimburse the                          
appropriate retirement system, within three years after the                    
end of the fiscal year in which the employee is appointed to                   
retirement, in an amount equal to                                              
(i)  the actuarial equivalent of the                                         
difference between the benefits the participant                                
receives after the addition of the credit under (f) of                         
this section and the amount the participant would                              
have received without the credit, less the amount the                          
participant has paid on the indebtedness determined                            
under (d) or (e) of this section; and                                          
(ii)  an appropriate share of the                                            
administrative costs of the program; and                                       
(B)  provides that contributions from the                                     
employer under this section take priority over other                           
obligations of the employer to the maximum extent                              
permitted by law.                                                              
(d)  A member of the teachers' retirement system who                           
participates in an approved retirement incentive plan under this Act           
is indebted to that system for an amount calculated under this                 
subsection.  The indebtedness is 25.95 percent of the member's                 
actual compensation for the school year in which the member                    
terminates employment, or the calculated school year compensation              
for a member who works less than the entire school year.  An                   
outstanding indebtedness at the time a member is appointed to                  
retirement under an approved retirement incentive plan requires an             
actuarial adjustment to the benefits payable to that member.                   
(e)  A member of the public employees' retirement system                       
who participates in an approved retirement incentive plan under this           
Act is indebted to that system for an amount calculated under this             
subsection.  The indebtedness is 22-1/2 percent for a peace officer            
or fire fighter, and 20-1/4 percent for other members, of the                  
member's actual annual compensation for the year in which the                  
member terminates employment, or the calculated annual                         
compensation for a member who works fewer than 12 months.  An                  
outstanding indebtedness at the time a member is appointed to                  
retirement under an approved retirement incentive plan requires  an            
actuarial adjustment to the benefits payable to that member.                   
                                                                               

1995-05-02                     Senate Journal                      Page 1427
SB 148                                                                       
(f)  An employee who participates in an approved retirement                    
incentive plan under this Act receives a credit of three years.  The           
three years must be applied in the following order until exhausted:            
(1)  to meet the age or service required for                                   
eligibility for normal retirement under AS14.25.110 or                         
AS39.35.370, as appropriate;                                                   
(2)  to meet the age required for early retirement                             
under AS14.25.110 or AS39.35.370, as appropriate;                              
(3)  to reduce the actuarial adjustment required for                           
early retirement under AS14.25.110 or AS39.35.370, as appropriate;             
(4)  as years of credited service for calculating                              
retirement benefits.                                                           
	(g)  In this section,                                                         
		(1)  "department" means                                                      
		(A)  a principal department of the executive                                
branch of state government; an independent state entity that                   
is attached to a principal department of the executive branch                  
for administrative purposes but that is not a public                           
organization as defined in AS39.35.680 is part of that                         
department for purposes of this paragraph; and                                 
		(B)  the Office of the Governor;                                            
		(2)  "employer" has the meaning given in                                     
AS14.25.220 and AS39.35.680 and includes a department.                         
   * Sec. 3.  AUTHORIZATION FOR STATE EMPLOYEE                               
RETIREMENT INCENTIVE.  (a)  A state agency may adopt, and                      
file with the commissioner of administration for approval, a proposed          
retirement incentive plan for its employees.                                   
	(b)  Upon the request of a state agency, the commissioner                     
of administration shall establish one or more periods during which             
the employees of that state agency who are eligible under sec.2(b)             
of this Act to participate in a retirement incentive plan may apply            
to the commissioner of administration to participate in the state              
agency's approved plan.  The periods shall begin no earlier than               
June 30, 1995, and end no later than June 30, 1998.  The periods               
shall be no less than 30 days and no more than 60 days in duration,            
and may not begin less than 30 days after their establishment.  A              
state agency is not required to request an application period, and             
may request more than one application period.                                  
                                                                               
                                                                               

1995-05-02                     Senate Journal                      Page 1428
SB 148                                                                       
	(c)  A proposed retirement incentive plan adopted under this                  
section may not permit an employee who is the governor, the                    
lieutenant governor, or a commissioner, deputy commissioner, or                
assistant commissioner of a principal department of the executive              
branch to participate in the plan.                                             
(d)  A proposed retirement incentive plan adopted under this                   
section may permit participation only by an employee who is eligible           
to participate under sec.2(b) of this Act and who                              
(1)  has been continuously employed by the state for                           
at least one year before the employee applies to participate in the            
state agency's approved plan;                                                  
(2)  is a permanent seasonal employee who has been                             
continuously employed by the state in a permanent seasonal position            
during all of the time in the one year before the employee's                   
application to participate in which the position normally is filled;           
(3)  has a job sharing agreement with a state agency                           
in which two or more employees share a single position identified              
by a single position control number and in which the employee who              
applies to participate in the plan was continuously employed by the            
agency during the portion of the one year before the employee's                
application in which the employee normally worked under the job                
sharing agreement; or                                                          
(4)  meets a combination of the requirements of this                           
subsection.                                                                    
(e)  The commissioner of administration may not accept the                     
application of an employee to participate in an approved retirement            
incentive plan adopted under this section unless the employee will             
be appointed to retirement not later than the first day of the month           
that is six months after the last day of the application period                
established by the commissioner under (b) of this section.  A state            
agency, in a plan adopted under this section, may set an earlier date          
by which an employee must be appointed to retirement in order to               
participate in the plan.                                                       
   * Sec. 4.  AUTHORIZATION FOR RETIREMENT INCENTIVE                         
FOR EMPLOYEES OF THE UNIVERSITY OF ALASKA.  (a)  The                           
Board of Regents of the University of Alaska may adopt, and file               
with the commissioner of administration for approval, a proposed               
retirement incentive plan for university employees.                            
                                                                               
                                                                               

1995-05-02                     Senate Journal                      Page 1429
SB 148                                                                       
	(b)  Upon the request of the Board of Regents, the                            
commissioner of administration shall establish one or more periods             
during which the employees of the university who are eligible under            
sec.2(b) of this Act to participate in a retirement incentive plan may         
apply to the commissioner of administration to participate in the              
university's approved plan.  The periods shall begin no earlier than           
June 30, 1995, and end no later than June30, 1998.  The periods                
shall be no less than 30 days and no more than 60 days in duration,            
and may not begin less than 30 days after their establishment.  The            
Board of Regents is not required to request an application period,             
and may request more than one application period.                              
(c)  The commissioner of administration may not accept the                     
application of an employee to participate in an approved retirement            
incentive plan adopted under this section unless the employee will             
be appointed to retirement not later than the first day of the month           
that is six months after the last day of the application period                
established by the commissioner under (b) of this section.  The                
Board of Regents, in a plan adopted under this section, may set an             
earlier date by which an employee of the University of Alaska must             
be appointed to retirement in order to participate in the plan.                
	(d)  A participant in the optional university retirement                      
program under AS14.40.661 - 14.40.799 who is vested in the public              
employees' retirement system or the teachers' retirement system may            
participate in a retirement incentive plan for that system if the              
participant meets the other qualifications of this Act.  If a provision        
of this subsection is inconsistent with another provision of law, the          
provision of this subsection governs.                                          
   * Sec. 5.  AUTHORIZATION FOR RETIREMENT INCENTIVE                         
FOR OTHER EMPLOYEES IN THE PUBLIC EMPLOYEES'                                   
RETIREMENT SYSTEM.  (a)  The governing body of a political                     
subdivision of the state or public organization that has elected to            
participate in the public employees' retirement system under AS39.-            
35.550 - 39.35.650 may adopt, and file with the commissioner of                
administration for approval, a proposed retirement incentive plan for          
its employees.  Upon the request of the governing body, the                    
commissioner of administration shall establish one or more periods             
during which the employees of a political subdivision or public                
organization  who are eligible to participate in a retirement incentive        
                                                                               
                                                                               

1995-05-02                     Senate Journal                      Page 1430
SB 148                                                                       
plan may apply to the commissioner of administration to participate            
in the approved plan. The periods shall begin no earlier than October          
31, 1995, and end no later than October 31, 1998.  The periods shall           
be no less than 30 days and no more than 60 days in duration, and              
may not begin less than 60 days after their establishment.  The                
governing body is not required to request an application period, and           
may request more than one application period.                                  
(b)  The commissioner of administration may not accept the                     
application of an employee to participate in an approved retirement            
incentive plan adopted under this section unless the employee will             
be appointed to retirement not later than the first day of the month           
that is six months after the last day of the application period                
established by the commissioner under (a) of this section.  The                
governing body of the political subdivision or public organization, in         
a plan adopted under this section, may set an earlier date by which            
an employee must be appointed to retirement in order to participate            
in the plan.                                                                   
   * Sec. 6.  AUTHORIZATION FOR RETIREMENT INCENTIVE                         
FOR OTHER EMPLOYEES IN THE TEACHERS' RETIREMENT                                
SYSTEM.  (a)  An employer under the teachers' retirement system                
who is not otherwise covered by secs.3 or 4 of this Act may adopt,             
and file with the commissioner of administration for approval, a               
proposed retirement incentive plan for its employees.  A plan                  
adopted under this section must provide that the application period            
for participation in the retirement incentive plan is June30, 1995,            
through December31, 1995.                                                      
(b)  The commissioner of administration may not accept the                     
application of an employee to participate in an approved retirement            
incentive plan adopted under this section unless the employee will             
be appointed to retirement on or before August1, 1996.  The                    
employer, in a plan adopted under this section, may set an earlier             
date by which an employee must be appointed to retirement in order             
to participate in the plan.                                                    
   * Sec. 7.  POLITICAL SUBDIVISION OR PUBLIC                                
ORGANIZATION EMPLOYMENT.  For purposes of determining                          
the years of service requirements for retirement under AS14.25.110             
or AS39.35.370, as appropriate, a vested member who is a state                 
employee and who applies to participate in a retirement incentive              
plan approved under this Act may receive credit for employment                 
with a political subdivision or public organization before the political       
                                                                               

1995-05-02                     Senate Journal                      Page 1431
SB 148                                                                       
subdivision or organization became an employer under the public                
employees' retirement system.  The member may not receive credit               
for those years under this subsection for purposes of determining              
benefits.  If a provision of this section is inconsistent with any other       
provision of law, the provision of this section governs.                       
   * Sec. 8.  RECOVERY OF EMPLOYER DELINQUENCIES.  To                        
recover a delinquency owed by an employer other than the state                 
under an agreement entered into under sec. 2(c)(2) of this Act, the            
Department of Administration may                                               
(1)  direct that the amount of the delinquency or a                            
lesser amount be withheld from any money payable to the employer               
by a state department or agency and that the amount withheld be                
credited to the delinquency; and                                               
		(2)  bring an action against the employer.                                   
   * Sec. 9.  PROVISION AND AUTHORIZATION FOR                                
ADMINISTRATIVE DIRECTOR OF COURT.  (a)  The chief justice                      
of the state supreme court may adopt a retirement incentive plan for           
an administrative director of the Alaska Court System who is a                 
member of the judicial retirement system under AS22.25.012 if                  
participation in the plan will result in savings to the court system in        
personal services costs within three years after the commencement              
of the plan.  The administrative director may participate only if the          
administrative director is vested in the judicial retirement system and        
will be qualified to retire under AS22.25.010 after receipt of the             
retirement incentive.  To participate, the administrative director shall       
apply to the commissioner of administration to participate in the              
approved court system plan.                                                    
	(b)  The court system shall include in the retirement                         
incentive plan a reimbursement agreement that requires the court               
system, for each administrative director of the Alaska Court System            
who is retired under the plan, to reimburse the judicial retirement            
system within three years after the end of the fiscal year in which            
the administrative director is appointed to retirement in an amount            
equal to                                                                       
		(1)  the actuarial equivalent of the difference                              
between the benefits the administrative director receives after the            
addition of the credit under (e) of this section and the amount the            
participant would have received without the credit, less the total of          
the amount the participant has paid on the indebtedness determined             
under (d) of this section; and                                                 
                                                                               

1995-05-02                     Senate Journal                      Page 1432
SB 148                                                                       
		(2)  an appropriate share of the administrative costs                        
of the program.                                                                
	(c)  A retirement incentive plan adopted under this section                   
must provide that contributions from the court system under (b) of             
this section take priority over other obligations of the court system          
to the maximum extent permitted by law.                                        
	(d)  An administrative director of the Alaska Court System                    
who participates in an approved retirement incentive plan is indebted          
to the system.  The amount of indebtedness is equal to 21 percent              
of the director's actual annual compensation for the year in which             
the director terminates employment to participate in the program, or           
the calculated annual compensation for an administrative director              
who works fewer than 12 months.  An outstanding indebtedness at                
the time the administrative director is appointed to retirement under          
an approved retirement incentive plan will require an actuarial                
adjustment to the benefits payable to the director.                            
	(e)  An administrative director of the Alaska Court System                    
who participates in an approved retirement incentive plan receives a           
credit of three years that may only be used to meet the age                    
requirements for normal or early retirement under AS22.25.010(d).              
	(f)  The chief justice of the Alaska Court System may adopt,                  
and file with the commissioner of administration for approval, a               
proposed retirement incentive plan for the administrative director of          
the court system who is a member of the judicial retirement system.            
Upon the request of the chief justice, the commissioner of                     
administration shall establish a period during which an administrative         
director eligible to participate in the retirement incentive plan of the       
court system may apply to the commissioner of administration to                
participate in the court system's approved plan.  The period shall             
begin no earlier than July1, 1995, and end no later than June30,               
1998.  The period shall be no less than 30 days and no more than               
60 days in duration and may not begin less than 30 days after                  
establishment.  The chief justice is not required to request an                
application period.                                                            
(g)  The commissioner of administration may not accept the                     
application of an administrative director of the court system to               
participate in an approved retirement incentive plan adopted under             
this section unless the administrative director will be appointed to           
retirement not later than the first day of the month that is six months        
                                                                               
                                                                               

1995-05-02                     Senate Journal                      Page 1433
SB 148                                                                       
after the last day of the application period established by the                
commissioner under (f) of this section.  The chief justice, in a plan          
adopted under this section, may set an earlier date by which an                
administrative director must be appointed to retirement in order to            
participate in the plan.                                                       
   * Sec. 10.  REEMPLOYMENT INDEBTEDNESS; PROHIBITION                        
ON REEMPLOYMENT.  (a)  If an individual is reemployed as a                     
member of the public employees' retirement system under AS39.35,               
the teachers' retirement system under AS14.25, the judicial                    
retirement system under AS22.25, or the optional university                    
retirement program under AS14.40.661- 14.40.799 after appoint-                 
ment to retirement under this Act, that individual forfeits the                
incentive credit received under sec.2(f) or sec. 9(e) of this Act and          
is indebted to the system under which the individual took retirement.          
The indebtedness is 110 percent of the amount the individual                   
received as a result of participation in a retirement incentive plan           
under this Act and to which the individual would not otherwise have            
been entitled, including the cost of health insurance.  The amount             
that the individual has paid under sec. 2(d) or (e) or sec. 9(d) of this       
Act will be applied as a credit toward the reemployment                        
indebtedness.  Interest on the reemployment indebtedness accrues               
from the date of reemployment until the date that the individual               
either is appointed to retirement and accepts an actuarial adjustment          
to the individual's future benefits or repays the indebtedness in full.        
The rate of interest is that established by regulation for the public          
employees' retirement system by the public employees' retirement               
board and for the teachers' retirement system by the teachers'                 
retirement board.                                                              
	(b)  An individual who was appointed to retirement under                      
this Act may not be employed by, or enter into a contract for                  
personal services with, a state agency or the University of Alaska             
within the three years after the date of appointment to retirement,            
except that                                                                    
		(1)  the University of Alaska may enter into a                               
personal services contract with the individual for teaching or                 
research; and                                                                  
		(2)  the individual may accept employment with the                           
legislature during a legislative session if the employment is on an            
hourly basis and does not entitle the individual to receive retirement,        
health, or leave benefits.                                                     
                                                                               

1995-05-02                     Senate Journal                      Page 1434
SB 148                                                                       
	(c)  Notwithstanding the prohibition in (b) of this section, a                
state agency or the University of Alaska may enter into a personal             
services contract with an individual who was  appointed to                     
retirement under this Act if the Board of Regents, for the University          
of Alaska, or the commissioner of administration, for a state agency,          
determines that there is a compelling reason to do so because of the           
individual's specialized or extensive experience that relates to a             
particular program or project of the state agency or university.               
However, a state agency may not enter into a contract with an                  
individual under this subsection if the individual was employed by             
that state agency at the time of the individual's appointment to               
retirement.                                                                    
   * Sec. 11.  SEPARATION INCENTIVE PROGRAM.  (a)  A                         
state agency may, with the approval of the director of the office of           
management and budget, establish a separation incentive program for            
its employees.  The program may be offered in combination with an              
approved retirement incentive plan adopted under sec. 3 of this Act,           
or may be offered separately from such a plan.  A state agency need            
not extend an incentive program under this section to all employees            
who would otherwise be eligible to participate, but may choose to              
extend the program only to employees                                           
		(1)  in specific budget or administrative components                         
of the state agency;                                                           
		(2)  in specific job classifications;                                        
		(3)  on the basis of any combination of factors                              
under (1) and (2) of this subsection.                                          
	(b)  A separation incentive payment under this section shall                  
be paid in a lump sum after the employee's separation from state               
service, and shall be equal to the lesser of an amount equaling six            
months of the employee's base salary, or $25,000.  However, a state            
agency or the office of management and budget may set a lower                  
separation incentive payment in the state agency's separation                  
incentive program.                                                             
	(c)  Upon the request of a state agency, the commissioner                     
of administration shall establish one or more periods during which             
the employees of that state agency may apply to the commissioner               
of administration to participate in the state agency's approved                
separation incentive program.  The periods shall begin no earlier              
than July 1, 1995, and end no later than June 30, 1998.  The periods           
                                                                               
                                                                               

1995-05-02                     Senate Journal                      Page 1435
SB 148                                                                       
shall be no less than 30 days and no more than 60 days in duration,            
and may not begin less than 30 days after their establishment.  A              
state agency is not required to request an application period, and             
may request more than one application period.  If the commissioner             
of administration has established one or more application periods for          
a state agency under sec.3(b) of this Act, the application period or           
periods established under this subsection must coincide with the               
period or periods established under sec.3(b) of this Act.                      
	(d)  A separation incentive program established under this                    
section must provide that a separation incentive payment to an                 
employee may be made only if                                                   
		(1) the employee is a permanent full-time or                                 
permanent full-time seasonal employee with at least five years of              
service with the state; and                                                    
		(2) the savings to the state agency in personal                              
services costs for the position occupied by that employee would                
exceed, in the three years after the employee separates, the amount            
of the separation incentive payment.                                           
	(e)  If an individual who received a separation incentive                     
payment under this section subsequently is reemployed by a state               
agency or the University of Alaska within the three years after the            
date that the individual received the separation incentive payment,            
the individual is liable to the state in an amount equal to 110                
percent of the amount of the separation incentive payment, plus                
interest at the rate prescribed by AS45.45.010, commencing on the              
date that the individual received the separation incentive payment.            
	(f)  If an employee is eligible to participate in an approved                 
retirement incentive plan adopted under sec. 3 of this Act,                    
		(1)  a separation incentive payment to that employee                         
may not exceed the amount that the state agency would be obligated             
to pay to the appropriate retirement system, notwithstanding (b) of            
this section; and                                                              
		(2)  the employee may participate in either the                              
separation incentive program under this section or the retirement              
incentive plan adopted under sec.3 of this Act, but not both.                  
	(g)  In this section, "base salary" means the monthly salary                  
paid to an employee under the applicable collective bargaining                 
agreement, AS39.27.011, or another applicable pay schedule, and                
includes geographic differential; if an employee is paid on an hourly          
                                                                               
                                                                               

1995-05-02                     Senate Journal                      Page 1436
SB 148                                                                       
basis, the employee's base salary is the employee's hourly rate,               
including geographic differential, multiplied by the number of hours           
in the employee's regular work week, multiplied by 4.35.                       
   * Sec. 12.  OFFICE OF MANAGEMENT AND BUDGET.  (a)                         
When designating an employee category for participation in a                   
retirement incentive plan or a separation incentive program under this         
Act, the executive head of the relevant state agency shall describe            
in detail the expected effect of the plan or program on the agency's           
personal services cost and operation.  This financial report must be           
approved by the director of the office of management and budget                
before the commissioner of administration may approve the proposed             
plan or program.  The state agency shall report each year to the               
office of management and budget on the cost of each employee's                 
participation and the effect on the agency's personal services cost            
and operation.                                                                 
	(b)  The office of management and budget shall submit to                      
the legislature annual reports on the retirement incentive and                 
separation incentive programs under this Act beginning January15,              
1997, and continuing through January15, 1999, and shall submit a               
final report January15, 2000.  Each report must provide the                    
information necessary for the legislature to evaluate the effectiveness        
of the programs in achieving their objectives.  The report must                
include information on the designated employee categories under the            
incentive programs, including the cost of each incentive program per           
participant, the cost to the state, the cost to the employee, the annual       
budgeted amount, by state agency, for the incentives, the number of            
positions deleted or left vacant, and the projected or actual net              
savings over the three-year period.                                            
   * Sec. 13.  PROGRAM CHANGES.  (a)  An individual employee                 
does not have a vested or contractual right to a benefit under this            
Act until an agreement is executed with the administrator that                 
specifically authorizes that employee to participate in the retirement         
incentive program under this Act or until an agreement is executed             
with the commissioner of administration to participate in the                  
separation incentive program under this Act.  The legislature reserves         
the right to change any aspect of either incentive program as it               
relates to employees for whom participation agreements have not yet            
been executed with the administrator or with the commissioner of               
administration.                                                                
                                                                               
                                                                               

1995-05-02                     Senate Journal                      Page 1437
SB 148                                                                       
	(b)  In this section, "administrator" means the administrator                 
of the public employees' retirement system for employees who are               
members of that system, and the administrator of the teachers'                 
retirement system for employees who are members of that system.                
   *Sec. 14.  REGULATIONS.  The commissioner of the                          
Department of Administration may adopt regulations under AS44.62               
(Administrative Procedure Act) to implement and interpret this Act.            
   * Sec. 15.  DEFINITIONS.  (a)  Unless provided otherwise in               
this Act, the definitions set out in AS14.25.220 apply to provisions           
in secs. 2- 10 of this Act that relate to the teachers' retirement             
system and members of the teachers' retirement system.                         
	(b)  Unless provided otherwise in this Act, the definitions set               
out in AS39.35.680 apply to provisions in secs. 2- 10 of this Act              
that relate to the public employees' retirement system and members             
of the public employees' retirement system.                                    
	(c)  Unless provided otherwise in this Act, the definition set                
out in AS22.25.900  applies to provisions in sec.9 of this Act that            
relate to the judicial retirement system and members of the judicial           
retirement system.                                                             
	(d)  In this Act,                                                             
		(1)  "judicial retirement system" means the                                  
retirement system established for judges and justices in AS22.25;              
		(2)  "office of management and budget" means the                             
office of management and budget in the Office of the Governor;                 
		(3)  "public employees' retirement system" means                             
the Public Employees' Retirement System of Alaska (AS39.35);                   
		(4)  "state agency"                                                          
		(A)  means                                                                  
		(i)  the legislative branch of state                                       
government;                                                                    
		(ii)  the judicial branch of state                                         
government;                                                                    
		(iii)  a principal department of the                                       
executive branch of state government; an                                       
independent state entity that is attached to a                                 
principal department of the executive branch for                               
administrative purposes but that is not a public                               
organization as defined in AS39.35.680 is part of                              
that department for purposes of this clause; and                               
                                                                               
                                                                               

1995-05-02                     Senate Journal                      Page 1438
SB 148                                                                       
		(iv)  the Office of the Governor;                                          
			(B)  does not include                                                       
		(i)  the University of Alaska;                                             
		(ii)  a political subdivision of the                                       
state; or                                                                      
		(iii)  a public organization as                                            
defined in AS39.35.680;                                                        
		(5)  "teachers' retirement system" means the                                 
Teachers' Retirement System of Alaska (AS14.25).                               
   * Sec. 16.  Sections 2, 3, and 11 of this Act are repealed July1,         
1999.                                                                          
   * Sec. 17.  Sections 4- 7 and 9 of this Act are repealed July1,           
1997.                                                                          
   * Sec. 18.  This Act takes effect immediately under                       
AS01.10.070(c)."                                                               
                                                                               
Senator Duncan moved for the adoption of Amendment No. 1.                      
Objections were heard.                                                         
                                                                               
Senator Pearce lifted the call.                                                
                                                                               
Senator Donley moved and asked unanimous consent that he be                    
excused from a call of the Senate for the remainder of May 2.                  
Without objection, Senator Donley was excused.                                 
                                                                               
Senator Pearce called the Senate.  The call was satisfied.                     
                                                                               
The question being: "Shall Amendment No. 1 be adopted?"  The roll              
was taken with the following result:                                           
                                                                               
CSSB 148(RLS)                                                                  
Second Reading                                                                 
Amendment No. 1                                                                
                                                                               
YEAS:  7   NAYS:  12   EXCUSED:  1   ABSENT:  0                              
                                                                               
Yeas:  Adams, Duncan, Ellis, Hoffman, Lincoln, Salo, Zharoff                   
                                                                               
Nays:  Frank, Green, Halford, Kelly, Leman, Miller, Pearce,                    
R.Phillips, Rieger, Sharp, Taylor, Torgerson                                   
                                                                               
Excused:  Donley                                                               
                                                                               

1995-05-02                     Senate Journal                      Page 1439
SB 148                                                                       
and so, Amendment No. 1 failed.                                                
                                                                               
Senator Leman offered Amendment No. 2:                                         
                                                                               
Throughout bill:                                                               
	Delete	"March 31, 1996"                                                       
	Insert	"July 1, 1995"                                                         
                                                                               
Senator Leman moved for the adoption of Amendment No. 2.                       
Objections were heard.                                                         
                                                                               
The question being: "Shall Amendment No. 2 be adopted?"  The roll              
was taken with the following result:                                           
                                                                               
CSSB 148(RLS)                                                                  
Second Reading                                                                 
Amendment No. 2                                                                
                                                                               
YEAS:  8   NAYS:  11   EXCUSED:  1   ABSENT:  0                              
                                                                               
Yeas:  Frank, Green, Kelly, Leman, Miller, Sharp, Taylor, Torgerson            
                                                                               
Nays:  Adams, Duncan, Ellis, Halford, Hoffman, Lincoln, Pearce,                
R.Phillips, Rieger, Salo, Zharoff                                              
                                                                               
Excused:  Donley                                                               
                                                                               
and so, Amendment No. 2 failed.                                                
                                                                               
Senator Duncan offered Amendment No. 3:                                        
                                                                               
Page 1, line 1, through page 27, line 28:                                      
	Delete all material and insert:                                               
""An Act relating to retirement incentive programs for the public           
employees' retirement system, the judicial retirement system, and              
the teachers' retirement system; relating to separation incentives             
for certain state employees; and providing for an effective date."            
                                                                               
                                                                               

1995-05-02                     Senate Journal                      Page 1440
SB 148                                                                       
BE IT ENACTED BY THE LEGISLATURE OF THE STATE                                 
OF ALASKA:                                                                    
   * Section 1.  FINDINGS AND PURPOSE.  The State of Alaska                  
and many local governments are facing the need to restructure their            
operations and their work forces in order to reduce expenditures and           
balance budgets.  Retirement and separation incentives are                     
management tools that have been used extensively by the private                
sector, the federal government, and other state and local governments          
across the country.  The purpose of this Act is to make these                  
management tools temporarily available to the state and to the                 
municipalities of the state.  This Act will enable these entities to be        
more efficient and cost-effective by eliminating certain nonessential          
positions, and producing a net reduction in personnel costs.                   
   * Sec. 2.  RETIREMENT INCENTIVE PROGRAM.  (a)  An                         
employer may adopt a retirement incentive plan under secs.3 - 6 of             
this Act, as appropriate, and designate categories of employees                
eligible to participate in that plan.  An employer need not extend the         
incentive plan to all employees who would otherwise be eligible, but           
may choose to extend the plan only to employees                                
		(1)  in specific budget or administrative components                         
of the employer;                                                               
		(2)  in specific job classifications;                                        
		(3)  in specific geographic locations; or                                    
		(4)  on the basis of any combination of factors                              
under (1) - (3) of this subsection.                                            
(b)  An employee is eligible to participate in a retirement                    
incentive plan under this Act only if the                                      
		(1)  employee is a vested member of the public                               
employees' retirement system or the teachers' retirement system;               
		(2)  employee will be qualified to retire under                              
AS14.25.110 or AS39.35.370 after receipt of the credit described               
in (f) of this section;                                                        
		(3)  savings to the employer in personal services                            
costs for the employee's position will exceed the costs to the                 
employer for that position within three years after the employee is            
appointed to retirement.                                                       
                                                                               
                                                                               

1995-05-02                     Senate Journal                      Page 1441
SB 148                                                                       
(c)  An employer shall file its proposed retirement incentive                  
plan with the commissioner of administration.  The commissioner                
shall approve the plan if the plan meets the requirements of this Act,         
except that the commissioner may approve a state agency's                      
retirement incentive plan only if the office of management and                 
budget approves the calculation of savings under (b)(3) of this                
section.  A proposed plan filed under this section must                        
(1)  identify job classifications of employees, and                            
specific budget or administrative components, eligible to participate          
in the plan;                                                                   
(2)  include a reimbursement agreement that                                    
(A)  requires the employer, for each                                          
employee who retires under the plan, to reimburse the                          
appropriate retirement system, within three years after the                    
end of the fiscal year in which the employee is appointed to                   
retirement, in an amount equal to                                              
(i)  the actuarial equivalent of the                                         
difference between the benefits the participant                                
receives after the addition of the credit under (f) of                         
this section and the amount the participant would                              
have received without the credit, less the amount the                          
participant has paid on the indebtedness determined                            
under (d) or (e) of this section; and                                          
(ii)  an appropriate share of the                                            
administrative costs of the program; and                                       
(B)  provides that contributions from the                                     
employer under this section take priority over other                           
obligations of the employer to the maximum extent                              
permitted by law.                                                              
(d)  A member of the teachers' retirement system who                           
participates in an approved retirement incentive plan under this Act           
is indebted to that system for an amount calculated under this                 
subsection.  The indebtedness is 25.95 percent of the member's                 
actual compensation for the school year in which the member                    
terminates employment, or the calculated school year compensation              
for a member who works less than the entire school year.  An                   
outstanding indebtedness at the time a member is appointed to                  
retirement under an approved retirement incentive plan requires an             
actuarial adjustment to the benefits payable to that member.                   
                                                                               
                                                                               

1995-05-02                     Senate Journal                      Page 1442
SB 148                                                                       
(e)  A member of the public employees' retirement system                       
who participates in an approved retirement incentive plan under this           
Act is indebted to that system for an amount calculated under this             
subsection.  The indebtedness is 22-1/2 percent for a peace officer            
or fire fighter, and 20-1/4 percent for other members, of the                  
member's actual annual compensation for the year in which the                  
member terminates employment, or the calculated annual                         
compensation for a member who works fewer than 12 months.  An                  
outstanding indebtedness at the time a member is appointed to                  
retirement under an approved retirement incentive plan requires  an            
actuarial adjustment to the benefits payable to that member.                   
(f)  An employee who participates in an approved retirement                    
incentive plan under this Act receives a credit of three years.  The           
three years must be applied in the following order until exhausted:            
(1)  to meet the age or service required for                                   
eligibility for normal retirement under AS14.25.110 or                         
AS39.35.370, as appropriate;                                                   
(2)  to meet the age required for early retirement                             
under AS14.25.110 or AS39.35.370, as appropriate;                              
(3)  to reduce the actuarial adjustment required for                           
early retirement under AS14.25.110 or AS39.35.370, as appropriate;             
(4)  as years of credited service for calculating                              
retirement benefits.                                                           
	(g)  In this section,                                                         
		(1)  "department" means                                                      
		(A)  a principal department of the executive                                
branch of state government; an independent state entity that                   
is attached to a principal department of the executive branch                  
for administrative purposes but that is not a public                           
organization as defined in AS39.35.680 is part of that                         
department for purposes of this paragraph; and                                 
		(B)  the Office of the Governor;                                            
		(2)  "employer" has the meaning given in                                     
AS14.25.220 and AS39.35.680 and includes a department.                         
   * Sec. 3.  AUTHORIZATION FOR STATE EMPLOYEE                               
RETIREMENT INCENTIVE.  (a)  A state agency may adopt, and                      
file with the commissioner of administration for approval, a proposed          
retirement incentive plan for its employees.                                   
                                                                               
                                                                               

1995-05-02                     Senate Journal                      Page 1443
SB 148                                                                       
	(b)  Upon the request of a state agency, the commissioner                     
of administration shall establish one or more periods during which             
the employees of that state agency who are eligible under sec.2(b)             
of this Act to participate in a retirement incentive plan may apply            
to the commissioner of administration to participate in the state              
agency's approved plan.  The periods shall begin no earlier than               
June 30, 1995, and end no later than June 30, 1998.  The periods               
shall be no less than 30 days and no more than 60 days in duration,            
and may not begin less than 30 days after their establishment.  A              
state agency is not required to request an application period, and             
may request more than one application period.                                  
	(c)  A proposed retirement incentive plan adopted under this                  
section may not permit an employee who is the governor, the                    
lieutenant governor, or a commissioner, deputy commissioner, or                
assistant commissioner of a principal department of the executive              
branch to participate in the plan.                                             
(d)  A proposed retirement incentive plan adopted under this                   
section may permit participation only by an employee who is eligible           
to participate under sec.2(b) of this Act and who                              
(1)  has been continuously employed by the state for                           
at least one year before the employee applies to participate in the            
state agency's approved plan;                                                  
(2)  is a permanent seasonal employee who has been                             
continuously employed by the state in a permanent seasonal position            
during all of the time in the one year before the employee's                   
application to participate in which the position normally is filled;           
(3)  has a job sharing agreement with a state agency                           
in which two or more employees share a single position identified              
by a single position control number and in which the employee who              
applies to participate in the plan was continuously employed by the            
agency during the portion of the one year before the employee's                
application in which the employee normally worked under the job                
sharing agreement; or                                                          
(4)  meets a combination of the requirements of this                           
subsection.                                                                    
(e)  The commissioner of administration may not accept the                     
application of an employee to participate in an approved retirement            
incentive plan adopted under this section unless the employee will             
be  appointed  to retirement not later than the first day of the month         
                                                                               
                                                                               

1995-05-02                     Senate Journal                      Page 1444
SB 148                                                                       
that is six months after the last day of the application period                
established by the commissioner under (b) of this section.  A state            
agency, in a plan adopted under this section, may set an earlier date          
by which an employee must be appointed to retirement in order to               
participate in the plan.                                                       
   * Sec. 4.  AUTHORIZATION FOR RETIREMENT INCENTIVE                         
FOR EMPLOYEES OF THE UNIVERSITY OF ALASKA.  (a)  The                           
Board of Regents of the University of Alaska may adopt, and file               
with the commissioner of administration for approval, a proposed               
retirement incentive plan for university employees.                            
	(b)  Upon the request of the Board of Regents, the                            
commissioner of administration shall establish one or more periods             
during which the employees of the university who are eligible under            
sec.2(b) of this Act to participate in a retirement incentive plan may         
apply to the commissioner of administration to participate in the              
university's approved plan.  The periods shall begin no earlier than           
June 30, 1995, and end no later than June30, 1998.  The periods                
shall be no less than 30 days and no more than 60 days in duration,            
and may not begin less than 30 days after their establishment.  The            
Board of Regents is not required to request an application period,             
and may request more than one application period.                              
(c)  The commissioner of administration may not accept the                     
application of an employee to participate in an approved retirement            
incentive plan adopted under this section unless the employee will             
be appointed to retirement not later than the first day of the month           
that is six months after the last day of the application period                
established by the commissioner under (b) of this section.  The                
Board of Regents, in a plan adopted under this section, may set an             
earlier date by which an employee of the University of Alaska must             
be appointed to retirement in order to participate in the plan.                
	(d)  A participant in the optional university retirement                      
program under AS14.40.661 - 14.40.799 who is vested in the public              
employees' retirement system or the teachers' retirement system may            
participate in a retirement incentive plan for that system if the              
participant meets the other qualifications of this Act.  If a provision        
of this subsection is inconsistent with another provision of law, the          
provision of this subsection governs.                                          
   * Sec. 5.  AUTHORIZATION FOR RETIREMENT INCENTIVE                         
FOR OTHER EMPLOYEES IN THE PUBLIC EMPLOYEES'                                   
RETIREMENT SYSTEM.  (a)  The governing body of a political                     
subdivision  of  the  state  or public organization that has elected to        

1995-05-02                     Senate Journal                      Page 1445
SB 148                                                                       
participate in the public employees' retirement system under AS39.-            
35.550 - 39.35.650 may adopt, and file with the commissioner of                
administration for approval, a proposed retirement incentive plan for          
its employees.  Upon the request of the governing body, the                    
commissioner of administration shall establish one or more periods             
during which the employees of a political subdivision or public                
organization who are eligible to participate in a retirement incentive         
plan may apply to the commissioner of administration to participate            
in the approved plan. The periods shall begin no earlier than October          
31, 1995, and end no later than October31, 1998.  The periods shall            
be no less than 30 days and no more than 60 days in duration, and              
may not begin less than 60 days after their establishment.  The                
governing body is not required to request an application period, and           
may request more than one application period.                                  
(b)  The commissioner of administration may not accept the                     
application of an employee to participate in an approved retirement            
incentive plan adopted under this section unless the employee will             
be appointed to retirement not later than the first day of the month           
that is six months after the last day of the application period                
established by the commissioner under (a) of this section.  The                
governing body of the political subdivision or public organization, in         
a plan adopted under this section, may set an earlier date by which            
an employee must be appointed to retirement in order to participate            
in the plan.                                                                   
   * Sec. 6.  AUTHORIZATION FOR RETIREMENT INCENTIVE                         
FOR EMPLOYEES OF REGIONAL RESOURCE CENTERS IN                                  
THE TEACHERS' RETIREMENT SYSTEM.  (a)  A regional                              
resource center that has employees who are members of the teachers'            
retirement system may adopt, and file with the commissioner of                 
administration for approval, a proposed retirement incentive plan for          
its employees.  A plan adopted under this section must provide that            
the application period for participation in the retirement incentive           
plan is June30, 1995, through December31, 1995.                                
(b)  The commissioner of administration may not accept the                     
application of an employee to participate in an approved retirement            
incentive plan adopted under this section unless the employee will             
be appointed to retirement on or before August1, 1996.  The                    
regional resource center, in a plan adopted under this section, may            
set an earlier date by which an employee must be appointed to                  
retirement in order to participate in the plan.                                
                                                                               

1995-05-02                     Senate Journal                      Page 1446
SB 148                                                                       
   * Sec. 7.  POLITICAL SUBDIVISION OR PUBLIC                                
ORGANIZATION EMPLOYMENT.  For purposes of determining                          
the years of service requirements for retirement under AS14.25.110             
or AS39.35.370, as appropriate, a vested member who is a state                 
employee and who applies to participate in a retirement incentive              
plan approved under this Act may receive credit for employment                 
with a political subdivision or public organization before the political       
subdivision or organization became an employer under the public                
employees' retirement system.  The member may not receive credit               
for those years under this subsection for purposes of determining              
benefits.  If a provision of this section is inconsistent with any other       
provision of law, the provision of this section governs.                       
   * Sec. 8.  RECOVERY OF EMPLOYER DELINQUENCIES.  To                        
recover a delinquency owed by an employer other than the state                 
under an agreement entered into under sec. 2(c)(2) of this Act, the            
Department of Administration may                                               
(1)  direct that the amount of the delinquency or a                            
lesser amount be withheld from any money payable to the employer               
by a state department or agency and that the amount withheld be                
credited to the delinquency; and                                               
		(2)  bring an action against the employer.                                   
   * Sec. 9.  PROVISION AND AUTHORIZATION FOR                                
ADMINISTRATIVE DIRECTOR OF COURT.  (a)  The chief justice                      
of the state supreme court may adopt a retirement incentive plan for           
an administrative director of the Alaska Court System who is a                 
member of the judicial retirement system under AS22.25.012 if                  
participation in the plan will result in savings to the court system in        
personal services costs within three years after the commencement              
of the plan.  The administrative director may participate only if the          
administrative director is vested in the judicial retirement system and        
will be qualified to retire under AS22.25.010 after receipt of the             
retirement incentive.  To participate, the administrative director shall       
apply to the commissioner of administration to participate in the              
approved court system plan.                                                    
	(b)  The court system shall include in the retirement                         
incentive plan a reimbursement agreement that requires the court               
system, for each administrative director of the Alaska Court System            
who is retired under the plan, to reimburse the judicial retirement            
system within three years after the end of the fiscal year in which            
the administrative director is appointed to retirement in an amount            
equal to                                                                       

1995-05-02                     Senate Journal                      Page 1447
SB 148                                                                       
		(1)  the actuarial equivalent of the difference                              
between the benefits the administrative director receives after the            
addition of the credit under (e) of this section and the amount the            
participant would have received without the credit, less the total of          
the amount the participant has paid on the indebtedness determined             
under (d) of this section; and                                                 
		(2)  an appropriate share of the administrative costs                        
of the program.                                                                
	(c)  A retirement incentive plan adopted under this section                   
must provide that contributions from the court system under (b) of             
this section take priority over other obligations of the court system          
to the maximum extent permitted by law.                                        
	(d)  An administrative director of the Alaska Court System                    
who participates in an approved retirement incentive plan is indebted          
to the system.  The amount of indebtedness is equal to 21 percent              
of the director's actual annual compensation for the year in which             
the director terminates employment to participate in the program, or           
the calculated annual compensation for an administrative director              
who works fewer than 12 months.  An outstanding indebtedness at                
the time the administrative director is appointed to retirement under          
an approved retirement incentive plan will require an actuarial                
adjustment to the benefits payable to the director.                            
	(e)  An administrative director of the Alaska Court System                    
who participates in an approved retirement incentive plan receives a           
credit of three years that may only be used to meet the age                    
requirements for normal or early retirement under AS22.25.010(d).              
	(f)  The chief justice of the Alaska Court System may adopt,                  
and file with the commissioner of administration for approval, a               
proposed retirement incentive plan for the administrative director of          
the court system who is a member of the judicial retirement system.            
Upon the request of the chief justice, the commissioner of                     
administration shall establish a period during which an administrative         
director eligible to participate in the retirement incentive plan of the       
court system may apply to the commissioner of administration to                
participate in the court system's approved plan.  The period shall             
begin no earlier than July1, 1995, and end no later than June30,               
1998.  The period shall be no less than 30 days and no more than               
60 days in duration and may not begin less than 30 days after                  
establishment.  The chief justice is not required to request an                
application period.                                                            
                                                                               

1995-05-02                     Senate Journal                      Page 1448
SB 148                                                                       
(g)  The commissioner of administration may not accept the                     
application of an administrative director of the court system to               
participate in an approved retirement incentive plan adopted under             
this section unless the administrative director will be appointed to           
retirement not later than the first day of the month that is six months        
after the last day of the application period established by the                
commissioner under (f) of this section.  The chief justice, in a plan          
adopted under this section, may set an earlier date by which an                
administrative director must be appointed to retirement in order to            
participate in the plan.                                                       
   * Sec. 10.  REEMPLOYMENT INDEBTEDNESS; PROHIBITION                        
ON REEMPLOYMENT.  (a)  If an individual is reemployed as a                     
member of the public employees' retirement system under AS39.35,               
the teachers' retirement system under AS14.25, the judicial                    
retirement system under AS22.25, or the optional university                    
retirement program under AS14.40.661- 14.40.799 after appoint-                 
ment to retirement under this Act, that individual forfeits the                
incentive credit received under sec.2(f) or sec. 9(e) of this Act and          
is indebted to the system under which the individual took retirement.          
The indebtedness is 110 percent of the amount the individual                   
received as a result of participation in a retirement incentive plan           
under this Act and to which the individual would not otherwise have            
been entitled, including the cost of health insurance.  The amount             
that the individual has paid under sec. 2(d) or (e) or sec. 9(d) of this       
Act will be applied as a credit toward the reemployment                        
indebtedness.  Interest on the reemployment indebtedness accrues               
from the date of reemployment until the date that the individual               
either is appointed to retirement and accepts an actuarial adjustment          
to the individual's future benefits or repays the indebtedness in full.        
The rate of interest is that established by regulation for the public          
employees' retirement system by the public employees' retirement               
board and for the teachers' retirement system by the teachers'                 
retirement board.                                                              
	(b)  An individual who was appointed to retirement under                      
this Act may not be employed by, or enter into a contract for                  
personal services with, a state agency or the University of Alaska             
within the three years after the date of appointment to retirement,            
except that                                                                    
		(1)  the University of Alaska may enter into a                               
personal services contract with the individual for teaching or                 
research; and                                                                  

1995-05-02                     Senate Journal                      Page 1449
SB 148                                                                       
		(2)  the individual may accept employment with the                           
legislature during a legislative session if the employment is on an            
hourly basis and does not entitle the individual to receive retirement,        
health, or leave benefits.                                                     
	(c)  Notwithstanding the prohibition in (b) of this section, a                
state agency or the University of Alaska may enter into a personal             
services contract with an individual who was  appointed to                     
retirement under this Act if the Board of Regents, for the University          
of Alaska, or the commissioner of administration, for a state agency,          
determines that there is a compelling reason to do so because of the           
individual's specialized or extensive experience that relates to a             
particular program or project of the state agency or university.               
However, a state agency may not enter into a contract with an                  
individual under this subsection if the individual was employed by             
that state agency at the time of the individual's appointment to               
retirement.                                                                    
   * Sec. 11.  SEPARATION INCENTIVE PROGRAM.  (a)  A                         
state agency may, with the approval of the director of the office of           
management and budget, establish a separation incentive program for            
its employees.  The program may be offered in combination with an              
approved retirement incentive plan adopted under sec. 3 of this Act,           
or may be offered separately from such a plan.  A state agency need            
not extend an incentive program under this section to all employees            
who would otherwise be eligible to participate, but may choose to              
extend the program only to employees                                           
		(1)  in specific budget or administrative components                         
of the state agency;                                                           
		(2)  in specific job classifications;                                        
		(3)  on the basis of any combination of factors                              
under (1) and (2) of this subsection.                                          
	(b)  A separation incentive payment under this section shall                  
be paid in a lump sum after the employee's separation from state               
service, and shall be equal to the lesser of an amount equaling six            
months of the employee's base salary, or $25,000.  However, a state            
agency or the office of management and budget may set a lower                  
separation incentive payment in the state agency's separation                  
incentive program.                                                             
                                                                               
                                                                               

1995-05-02                     Senate Journal                      Page 1450
SB 148                                                                       
	(c)  Upon the request of a state agency, the commissioner                     
of administration shall establish one or more periods during which             
the employees of that state agency may apply to the commissioner               
of administration to participate in the state agency's approved                
separation incentive program.  The periods shall begin no earlier              
than July 1, 1995, and end no later than June 30, 1998.  The periods           
shall be no less than 30 days and no more than 60 days in duration,            
and may not begin less than 30 days after their establishment.  A              
state agency is not required to request an application period, and             
may request more than one application period.  If the commissioner             
of administration has established one or more application periods for          
a state agency under sec.3(b) of this Act, the application period or           
periods established under this subsection must coincide with the               
period or periods established under sec.3(b) of this Act.                      
	(d)  A separation incentive program established under this                    
section must provide that a separation incentive payment to an                 
employee may be made only if                                                   
		(1) the employee is a permanent full-time or                                 
permanent full-time seasonal employee with at least five years of              
service with the state; and                                                    
		(2) the savings to the state agency in personal                              
services costs for the position occupied by that employee would                
exceed, in the three years after the employee separates, the amount            
of the separation incentive payment.                                           
	(e)  If an individual who received a separation incentive                     
payment under this section subsequently is reemployed by a state               
agency or the University of Alaska within the three years after the            
date that the individual received the separation incentive payment,            
the individual is liable to the state in an amount equal to 110                
percent of the amount of the separation incentive payment, plus                
interest at the rate prescribed by AS45.45.010, commencing on the              
date that the individual received the separation incentive payment.            
	(f)  If an employee is eligible to participate in an approved                 
retirement incentive plan adopted under sec. 3 of this Act,                    
		(1)  a separation incentive payment to that employee                         
may not exceed the amount that the state agency would be obligated             
to pay to the appropriate retirement system, notwithstanding (b) of            
this section; and                                                              
		(2)  the employee may participate in either the                              
separation incentive program under this section or the retirement              
incentive plan adopted under sec.3 of this Act, but not both.                  

1995-05-02                     Senate Journal                      Page 1451
SB 148                                                                       
	(g)  In this section, "base salary" means the monthly salary                  
paid to an employee under the applicable collective bargaining                 
agreement, AS39.27.011, or another applicable pay schedule, and                
includes geographic differential; if an employee is paid on an hourly          
basis, the employee's base salary is the employee's hourly rate,               
including geographic differential, multiplied by the number of hours           
in the employee's regular work week, multiplied by 4.35.                       
   * Sec. 12.  OFFICE OF MANAGEMENT AND BUDGET.  (a)                         
When designating an employee category for participation in a                   
retirement incentive plan or a separation incentive program under this         
Act, the executive head of the relevant state agency shall describe            
in detail the expected effect of the plan or program on the agency's           
personal services cost and operation.  This financial report must be           
approved by the director of the office of management and budget                
before the commissioner of administration may approve the proposed             
plan or program.  The state agency shall report each year to the               
office of management and budget on the cost of each employee's                 
participation and the effect on the agency's personal services cost            
and operation.                                                                 
	(b)  The office of management and budget shall submit to                      
the legislature annual reports on the retirement incentive and                 
separation incentive programs under this Act beginning January15,              
1997, and continuing through January15, 1999, and shall submit a               
final report January15, 2000.  Each report must provide the                    
information necessary for the legislature to evaluate the effectiveness        
of the programs in achieving their objectives.  The report must                
include information on the designated employee categories under the            
incentive programs, including the cost of each incentive program per           
participant, the cost to the state, the cost to the employee, the annual       
budgeted amount, by state agency, for the incentives, the number of            
positions deleted or left vacant, and the projected or actual net              
savings over the three-year period.                                            
   * Sec. 13.  PROGRAM CHANGES.  (a)  An individual employee                 
does not have a vested or contractual right to a benefit under this            
Act until an agreement is executed with the administrator that                 
specifically authorizes that employee to participate in the retirement         
incentive program under this Act or until an agreement is executed             
with the commissioner of administration to participate in the                  
separation incentive program under this Act.  The legislature reserves         
                                                                               
                                                                               

1995-05-02                     Senate Journal                      Page 1452
SB 148                                                                       
the right to change any aspect of either incentive program as it               
relates to employees for whom participation agreements have not yet            
been executed with the administrator or with the commissioner of               
administration.                                                                
	(b)  In this section, "administrator" means the administrator                 
of the public employees' retirement system for employees who are               
members of that system, and the administrator of the teachers'                 
retirement system for employees who are members of that system.                
   *Sec. 14.  REGULATIONS.  The commissioner of the                          
Department of Administration may adopt regulations under AS44.62               
(Administrative Procedure Act) to implement and interpret this Act.            
   * Sec. 15.  DEFINITIONS.  (a)  Unless provided otherwise in               
this Act, the definitions set out in AS14.25.220 apply to provisions           
in secs. 2- 10 of this Act that relate to the teachers' retirement             
system and members of the teachers' retirement system except that              
"employer" does not include a school district.                                 
	(b)  Unless provided otherwise in this Act, the definitions set               
out in AS39.35.680 apply to provisions in secs. 2- 10 of this Act              
that relate to the public employees' retirement system and members             
of the public employees' retirement system.                                    
	(c)  Unless provided otherwise in this Act, the definition set                
out in AS22.25.900  applies to provisions in sec.9 of this Act that            
relate to the judicial retirement system and members of the judicial           
retirement system.                                                             
	(d)  In this Act,                                                             
		(1)  "judicial retirement system" means the                                  
retirement system established for judges and justices in AS22.25;              
		(2)  "office of management and budget" means the                             
office of management and budget in the Office of the Governor;                 
		(3)  "public employees' retirement system" means                             
the Public Employees' Retirement System of Alaska (AS39.35);                   
		(4)  "state agency"                                                          
		(A)  means                                                                  
		(i)  the legislative branch of state                                       
government;                                                                    
		(ii)  the judicial branch of state                                         
government;                                                                    
                                                                               
                                                                               

1995-05-02                     Senate Journal                      Page 1453
SB 148                                                                       
		(iii)  a principal department of the                                       
executive branch of state government; an                                       
independent state entity that is attached to a                                 
principal department of the executive branch for                               
administrative purposes but that is not a public                               
organization as defined in AS39.35.680 is part of                              
that department for purposes of this clause; and                               
		(iv)  the Office of the Governor;                                          
			(B)  does not include                                                       
		(i)  the University of Alaska;                                             
		(ii)  a political subdivision of the                                       
state; or                                                                      
		(iii)  a public organization as                                            
defined in AS39.35.680;                                                        
		(5)  "teachers' retirement system" means the                                 
Teachers' Retirement System of Alaska (AS14.25).                               
   * Sec. 16.  Sections 2, 3, and 11 of this Act are repealed July1,         
1999.                                                                          
   * Sec. 17.  Sections 4- 7 and 9 of this Act are repealed July1,           
1997.                                                                          
   * Sec. 18.  This Act takes effect immediately under                       
AS01.10.070(c)."                                                               
                                                                               
Senator Duncan moved for the adoption of Amendment No. 3.                      
Objections were heard.                                                         
                                                                               
The question being: "Shall Amendment No. 3 be adopted?"  The roll              
was taken with the following result:                                           
                                                                               
CSSB 148(RLS)                                                                  
Second Reading                                                                 
Amendment No. 3                                                                
                                                                               
YEAS:  7   NAYS:  12   EXCUSED:  1   ABSENT:  0                              
                                                                               
Yeas:  Adams, Duncan, Ellis, Hoffman, Lincoln, Salo, Zharoff                   
                                                                               
Nays:  Frank, Green, Halford, Kelly, Leman, Miller, Pearce,                    
R.Phillips, Rieger, Sharp, Taylor, Torgerson                                   
                                                                               
Excused:  Donley                                                               
                                                                               

1995-05-02                     Senate Journal                      Page 1454
SB 148                                                                       
and so, Amendment No. 3 failed.                                                
                                                                               
Senator Duncan offered Amendment No. 4:                                        
                                                                               
Page 2, line 12:                                                               
	Delete "5.5"                                                              
	Insert "6.5"                                                              
                                                                               
Page 3, line 2, through page 4, line 5:                                        
	Delete all material.                                                          
                                                                               
Renumber the following bill sections accordingly.                              
                                                                               
Conform internal references to bill sections accordingly.                      
                                                                               
Senator Duncan moved for the adoption of Amendment No. 4.                      
Senator Miller objected.                                                       
                                                                               
The question being: "Shall Amendment No. 4 be adopted?"  The roll              
was taken with the following result:                                           
                                                                               
CSSB 148(RLS)                                                                  
Second Reading                                                                 
Amendment No. 4                                                                
                                                                               
YEAS:  7   NAYS:  12   EXCUSED:  1   ABSENT:  0                              
                                                                               
Yeas:  Adams, Duncan, Ellis, Hoffman, Lincoln, Salo, Zharoff                   
                                                                               
Nays:  Frank, Green, Halford, Kelly, Leman, Miller, Pearce,                    
R.Phillips, Rieger, Sharp, Taylor, Torgerson                                   
                                                                               
Excused:  Donley                                                               
                                                                               
and so, Amendment No. 4 failed.                                                
                                                                               
Senator Duncan offered Amendment No. 5:                                        
                                                                               
Page 7, line 31:                                                               
	Delete "six"                                                              
	Insert "seven"                                                            
                                                                               

1995-05-02                     Senate Journal                      Page 1455
SB 148                                                                       
Page 10, lines 2 - 6:                                                          
	Delete "fighter for peace officers or fire fighters first hired             
before March31, 1996, or hired on or after that date by a                      
nonparticipating employer; [, OR]                                            
		(3)  with at least 25 years of credited                                   
service as a peace officer or fire fighter for peace officers                  
and fire fighters first hired on or after March31, 1996,                       
other than employees of nonparticipating employers;"                         
	Insert "fighter; [,] or"                                                  
                                                                               
Page 10, line 7:                                                               
	Delete "(4)"                                                              
	Insert "(3)"                                                                  
                                                                               
Page 10, line 9:                                                               
	Delete "; or"                                                             
	Insert "."                                                                    
                                                                               
Page 10, lines 10 - 11:                                                        
	Delete "(5)  with a combination of age and years of                         
credited service equal to or greater than 85."                               
                                                                               
Senator Duncan moved for the adoption of Amendment No. 5.                      
Objections were heard.                                                         
                                                                               
The question being: "Shall Amendment No. 5 be adopted?"  The roll              
was taken with the following result:                                           
                                                                               
CSSB 148(RLS)                                                                  
Second Reading                                                                 
Amendment No. 5                                                                
                                                                               
YEAS:  8   NAYS:  11   EXCUSED:  1   ABSENT:  0                              
                                                                               
Yeas:  Adams, Duncan, Ellis, Hoffman, Kelly, Lincoln, Salo, Zharoff            
                                                                               
Nays:  Frank, Green, Halford, Leman, Miller, Pearce, R.Phillips,               
Rieger, Sharp, Taylor, Torgerson                                               
                                                                               
Excused:  Donley                                                               
                                                                               
and so, Amendment No. 5 failed.                                                

1995-05-02                     Senate Journal                      Page 1456
SB 148                                                                       
Senator Duncan offered Amendment No. 6:                                        
                                                                               
Page 8, line 7:                                                                
	Delete "five and one-half"                                                
	Insert "six and one-half"                                                 
                                                                               
Page 10, lines 7 - 11:                                                         
	Delete                                                                        
		"(4)  with at least 30 years of credited                                
service for all other employees if the employee was first                    
hired before March31, 1996, or if the employee was                             
hired on or after that date by a nonparticipating                              
employer; or                                                                   
		(5)  with a combination of age and years                                    
of credited service equal to or greater than 85."                            
	Insert                                                                        
		"(4)  with at least 30 years of credited                                
service for all other employees."                                              
                                                                               
Senator Duncan moved for the adoption of Amendment No. 6.                      
Objections were heard.                                                         
                                                                               
The question being: "Shall Amendment No. 6 be adopted?"  The roll              
was taken with the following result:                                           
                                                                               
CSSB 148(RLS)                                                                  
Second Reading                                                                 
Amendment No. 6                                                                
                                                                               
YEAS:  7   NAYS:  12   EXCUSED:  1   ABSENT:  0                              
                                                                               
Yeas:  Adams, Duncan, Ellis, Hoffman, Lincoln, Salo, Zharoff                   
                                                                               
Nays:  Frank, Green, Halford, Kelly, Leman, Miller, Pearce,                    
R.Phillips, Rieger, Sharp, Taylor, Torgerson                                   
                                                                               
Excused:  Donley                                                               
                                                                               
and so, Amendment No. 6 failed.                                                
                                                                               
Senator Duncan offered Amendment No. 7:                                        
                                                                               

1995-05-02                     Senate Journal                      Page 1457
SB 148                                                                       
Page 9, after line 27:                                                         
	Insert a new bill section to read:                                            
   "* Sec. 15.  AS39.35.345(d) is repealed and reenacted to read:            
	(d)  An employee may choose whether the credited                             
service granted under this section is used to satisfy the                      
credited service requirements for normal retirement or is                      
only used for the calculation of benefits.  An election under                  
this subsection is irrevocable and applies to all temporary                    
credited service that the employee has accrued when the                        
employee retires."                                                             
                                                                               
Renumber the following bill sections accordingly.                              
                                                                               
Conform internal references to bill sections accordingly.                      
                                                                               
Page 27, after line 25:                                                        
	Insert a new bill section to read:                                            
   "* Sec. 42.  A member of the public employees' retirement                 
system who has claimed credited service under AS39.35.345 on or                
before the effective date of sec.15 of this Act may exercise the               
election established under AS39.35.345(d), as amended by sec. 15               
of this Act, before the member is appointed to retirement."                    
                                                                               
Renumber the following bill sections accordingly.                              
                                                                               
Senator Duncan moved for the adoption of Amendment No. 7.                      
Objections were heard.                                                         
                                                                               
The question being: "Shall Amendment No. 7 be adopted?"  The roll              
was taken with the following result:                                           
                                                                               
CSSB 148(RLS)                                                                  
Second Reading                                                                 
Amendment No. 7                                                                
                                                                               
YEAS:  7   NAYS:  12   EXCUSED:  1   ABSENT:  0                              
                                                                               
Yeas:  Adams, Duncan, Ellis, Hoffman, Lincoln, Salo, Zharoff                   
                                                                               
Nays:  Frank, Green, Halford, Kelly, Leman, Miller, Pearce,                    
R.Phillips, Rieger, Sharp, Taylor, Torgerson                                   
                                                                               

1995-05-02                     Senate Journal                      Page 1458
SB 148                                                                       
Excused:  Donley                                                               
                                                                               
and so, Amendment No. 7 failed.                                                
                                                                               
Senator Duncan offered Amendment No. 8:                                        
                                                                               
Page 10, line 24, through page 11, line 12:                                    
	Delete all material.                                                          
                                                                               
Renumber the following bill sections accordingly.                              
                                                                               
Conform internal references to bill sections accordingly.                      
                                                                               
Senator Duncan moved for the adoption of Amendment No. 8.                      
Objections were heard.                                                         
                                                                               
The question being: "Shall Amendment No. 8 be adopted?"  The roll              
was taken with the following result:                                           
                                                                               
CSSB 148(RLS)                                                                  
Second Reading                                                                 
Amendment No. 8                                                                
                                                                               
YEAS:  7   NAYS:  12   EXCUSED:  1   ABSENT:  0                              
                                                                               
Yeas:  Adams, Duncan, Ellis, Hoffman, Lincoln, Salo, Zharoff                   
                                                                               
Nays:  Frank, Green, Halford, Kelly, Leman, Miller, Pearce,                    
R.Phillips, Rieger, Sharp, Taylor, Torgerson                                   
                                                                               
Excused:  Donley                                                               
                                                                               
and so, Amendment No. 8 failed.                                                
                                                                               
Senator Duncan offered Amendment No. 9:                                        
                                                                               
Page 10, line 27:                                                              
	Delete "one and one-half"                                                 
	Insert "two"                                                              
                                                                               
Senator Duncan moved for the adoption of Amendment No. 9.                      
Objections were heard.                                                         

1995-05-02                     Senate Journal                      Page 1459
SB 148                                                                       
The question being: "Shall Amendment No. 9 be adopted?"  The roll              
was taken with the following result:                                           
                                                                               
CSSB 148(RLS)                                                                  
Second Reading                                                                 
Amendment No. 9                                                                
                                                                               
YEAS:  5   NAYS:  14   EXCUSED:  1   ABSENT:  0                              
                                                                               
Yeas:  Adams, Duncan, Ellis, Lincoln, Zharoff                                  
                                                                               
Nays:  Frank, Green, Halford, Hoffman, Kelly, Leman, Miller,                   
Pearce, R.Phillips, Rieger, Salo, Sharp, Taylor, Torgerson                     
                                                                               
Excused:  Donley                                                               
                                                                               
Hoffman changed from "Yea" to "Nay".                                           
                                                                               
and so, Amendment No. 9 failed.                                                
                                                                               
Senator Duncan offered Amendment No. 10:                                       
                                                                               
Page 5, lines 13 - 28:                                                         
	Delete all material.                                                          
                                                                               
Renumber the following bill sections accordingly.                              
                                                                               
Conform internal references to bill sections accordingly.                      
                                                                               
Page 12, line 28, through page 13, line 12:                                    
	Delete all material.                                                          
                                                                               
Renumber the following bill sections accordingly.                              
                                                                               
Conform internal references to bill sections accordingly.                      
                                                                               
Senator Duncan moved for the adoption of Amendment No. 10.                     
Objections were heard.                                                         
                                                                               
The question being: "Shall Amendment No. 10 be adopted?"  The                  
roll was taken with the following result:                                      
                                                                               
                                                                               

1995-05-02                     Senate Journal                      Page 1460
SB 148                                                                       
                                                                               
CSSB 148(RLS)                                                                  
Second Reading                                                                 
Amendment No. 10                                                               
                                                                               
YEAS:  7   NAYS:  12   EXCUSED:  1   ABSENT:  0                              
                                                                               
Yeas:  Adams, Duncan, Ellis, Hoffman, Lincoln, Salo, Zharoff                   
                                                                               
Nays:  Frank, Green, Halford, Kelly, Leman, Miller, Pearce,                    
R.Phillips, Rieger, Sharp, Taylor, Torgerson                                   
                                                                               
Excused:  Donley                                                               
                                                                               
and so, Amendment No. 10 failed.                                               
                                                                               
Senator Duncan offered Amendment No. 11:                                       
                                                                               
Page 13, lines 13 - 26:                                                        
	Delete all material.                                                          
                                                                               
Renumber the following bill sections accordingly.                              
                                                                               
Conform internal references to bill sections accordingly.                      
                                                                               
Senator Duncan moved for the adoption of Amendment No. 11.                     
Objections were heard.                                                         
                                                                               
The question being: "Shall Amendment No. 11 be adopted?"  The                  
roll was taken with the following result:                                      
                                                                               
CSSB 148(RLS)                                                                  
Second Reading                                                                 
Amendment No. 11                                                               
                                                                               
YEAS:  7   NAYS:  12   EXCUSED:  1   ABSENT:  0                              
                                                                               
Yeas:  Adams, Duncan, Ellis, Hoffman, Lincoln, Salo, Zharoff                   
                                                                               
Nays:  Frank, Green, Halford, Kelly, Leman, Miller, Pearce,                    
R.Phillips, Rieger, Sharp, Taylor, Torgerson                                   
                                                                               
Excused:  Donley                                                               
                                                                               

1995-05-02                     Senate Journal                      Page 1461
SB 148                                                                       
                                                                               
and so, Amendment No. 11 failed.                                               
                                                                               
Senator Halford moved that the bill be considered engrossed,                   
advanced to third reading and placed on final passage.  Senator                
Duncan objected.                                                               
                                                                               
Senator Duncan rose to a point of order.  President Pearce ruled the           
point well taken.                                                              
                                                                               
The question being: "Shall the bill be advanced to third reading?"             
The roll was taken with the following result:                                  
                                                                               
CSSB 148(RLS)                                                                  
Advance from Second to Third Reading?                                          
                                                                               
YEAS:  12   NAYS:  7   EXCUSED:  1   ABSENT:  0                              
                                                                               
Yeas:  Frank, Green, Halford, Kelly, Leman, Miller, Pearce,                    
R.Phillips, Rieger, Sharp, Taylor, Torgerson                                   
                                                                               
Nays:  Adams, Duncan, Ellis, Hoffman, Lincoln, Salo, Zharoff                   
                                                                               
Excused:  Donley                                                               
                                                                               
and so, the bill failed to advance to third reading.                           
                                                                               
CS FOR SENATE BILL NO. 148(RLS) will appear on the May 3                       
calendar.