Legislature(2003 - 2004)

05/05/2003 01:35 PM Senate HES

Audio Topic
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
            SB 145-REEMPLOYMENT OF RETIRED TEACHERS                                                                         
CHAIR FRED DYSON announced SB 145 to be up for consideration.                                                                   
SENATOR GARY STEVENS,  sponsor, said Alaska is  facing a shortage                                                               
of qualified teachers  and this bill would allow  the rehiring of                                                               
early retired  teachers. The  Retirement Incentive  Program (RIP)                                                               
was a  big disincentive  for people  to return  to work,  as they                                                               
would  have  to  pay  back  110  percent  of  the  benefits  they                                                               
received.  There is  no actuarial  impact to  the districts,  but                                                               
they would  be required to  certify that they are  experiencing a                                                               
shortage. This would  not guarantee tenure and  salaries would be                                                               
negotiable. It does  not require districts to  hire RIP teachers,                                                               
but gives  them that option  in times of  need. It will  not cost                                                               
the  state  money because  it  has  already  been taken  care  of                                                               
through the  retirement system and  it will help the  shortage of                                                               
teachers in our state.                                                                                                          
TAPE 03-26, SIDE B                                                                                                            
SENATOR GARY  WILKEN asked how he  envisioned certification being                                                               
SENATOR STEVENS replied certification  would be a notification to                                                               
the Department  of Education  that a  district is  experiencing a                                                               
shortage  of  teachers. Otherwise,  he  didn't  know any  of  the                                                               
specifics of the procedure.                                                                                                     
SENATOR  WILKEN asked  if certification  adds to  the bureaucracy                                                               
and what does it do to help  in the scheme of things. Does anyone                                                               
look at the certification or does it put someone on notice?                                                                     
SENATOR STEVENS  replied that  he thought  it would  just require                                                               
the district  to look at it  carefully to make sure  they weren't                                                               
using  it because  they had  a  RIP teacher  available, and  that                                                               
there  was, in  fact, a  shortage. He  would be  more comfortable                                                               
having the department comment on the specifics.                                                                                 
SENATOR WILKEN  asked if he  envisioned that the  teachers coming                                                               
back would be included or excluded from the NEA bargaining unit.                                                                
SENATOR  STEVENS  answered  that  they  would  not  be  receiving                                                               
retirement  or  benefits  from the  union  because  the  district                                                               
negotiates  the  contract and  is  separate  from the  union.  He                                                               
thought they would be outside the purview of the union.                                                                         
CHAIR  DYSON  wanted  clarification  on page  3,  section  4,  on                                                               
receiving benefits during the period  of reemployment. An earlier                                                               
page indicates they  may within 30 days of  reemployment elect to                                                               
continue receiving benefits during the  period by filing a waiver                                                               
of coverage.                                                                                                                    
MS. JANET PARKER, Division of  Retirement and Benefits, explained                                                               
that when  coming back  to work  the employee  has the  option to                                                               
continue receiving  their benefits  or to waive  their retirement                                                               
benefit and continue to receive retirement credit.                                                                              
     But  if   they  want,  and  it's   certainly  to  their                                                                    
     advantage  if you're  eligible to  retire  with a  full                                                                    
     retirement benefit of 20 years  or longer, then you can                                                                    
     actually work  and receive both your  paycheck and your                                                                    
     retirement check.                                                                                                          
She said that dozens of retirees had been brought back that way.                                                                
CHAIR DYSON  said this  is just giving  RIP'd employees  the same                                                               
options as existing retired employees have.                                                                                     
MS. PARKER said that was correct.                                                                                               
CHAIR  DYSON asked  if a  retired teacher  is hired  back at  any                                                               
level their new employer chooses.                                                                                               
SENATOR STEVENS answered that he thought that was negotiable.                                                                   
MS. PARKER said  she thought someone from the  school board could                                                               
best answer  that question. She  didn't know about  the different                                                               
contracts. It's possible that they  could collectively bargain to                                                               
reduce their salary off the normal salary schedule they have.                                                                   
CHAIR DYSON  said he was  confused and  asked again if  there was                                                               
any language in the bill that  would require the district to hire                                                               
someone in at  the level they were when they  retired or can they                                                               
hire someone  back at  any level that  is mutually  acceptable to                                                               
SENATOR STEVENS replied  that he thought the later  was the case.                                                               
The district is not forced to  hire anyone back at the level they                                                               
retired from.                                                                                                                   
CHAIR DYSON said he may have  asked the question poorly and asked                                                               
     If  they  came   back  and  chose  not   to  get  their                                                                    
     retirement  benefits while  they were  working, I  read                                                                    
     the bill  to say that they  would accumulate additional                                                                    
     retirement benefits  to be collected  at a  future date                                                                    
     after they retired a second time.                                                                                          
MS. PARKER said that is correct.                                                                                                
CHAIR DYSON  asked further  if they chose  the later  course, are                                                               
they  accruing their  additional retirement  benefits based  upon                                                               
their new salary  in the new job that they  have negotiated or is                                                               
it at the level it was when they retired the first time.                                                                        
MS. PARKER replied they would  receive a benefit based upon their                                                               
new segment of employment, however long and at that salary.                                                                     
SENATOR STEVENS said  the bill had two things  that could happen.                                                               
One,  you  can be  a  RIP  teacher and  decide  to  go back  into                                                               
teaching  and  pay  back  110  percent  of  everything  you  have                                                               
received  - back  into the  system as  you were  before retiring.                                                               
"All  sins  are forgiven"  -  and  you're  a tenured  teacher  at                                                               
whatever level  you were. The  second choice  is you can  say you                                                               
are going to keep your retirement.                                                                                              
CHAIR  DYSON interrupted  saying  there is  a difference  between                                                               
keeping your retirement and keeping  RIP benefits. "Those are two                                                               
different things."                                                                                                              
MS. PARKER said  that he was correct about that.  "If I decide to                                                               
come back  and I  was a  RIP retiree  and if  I don't  accept the                                                               
waiver, then I have to pay  the penalties - for teachers it's 110                                                               
percent of the benefits received, which would be pretty..."                                                                     
CHAIR DYSON asked what happened if you do accept the waiver.                                                                    
MS.  PARKER replied  if you  accept  the waiver,  you forego  the                                                               
penalty, you  don't have  to pay anything  back. You  continue to                                                               
get  your benefit  and whatever  salary agreement  you have  made                                                               
with the school district.                                                                                                       
CHAIR DYSON  asked, "So, somebody that  got a RIP and  comes back                                                               
under the waiver that would  be authorized under this bill cannot                                                               
accumulate any more retirement benefits?"                                                                                       
MS. PARKER said that was correct.                                                                                               
SENATOR STEVENS agreed with that.                                                                                               
CHAIR DYSON asked where in the bill it made that clear.                                                                         
SENATOR WILKEN asked why someone  would choose not to continue to                                                               
receive his benefits.                                                                                                           
SENATOR STEVENS  responded that he  thought it was  unlikely that                                                               
anyone would choose to pay back  110 percent. He thought they are                                                               
really dealing with the other  scenario of someone who chooses to                                                               
keep their retirement and receive some pay for the work they do.                                                                
SENATOR WILKEN  speculated if he  is getting his  retirement pay,                                                               
he might come back at half of what he made before.                                                                              
SENATOR  GREEN said  there is  a provision  currently in  statute                                                               
that  allows, if  you establish  a special  circumstance in  your                                                               
area and you have to have someone  on staff, you can get a waiver                                                               
from  PERS or  TRS  and go  through a  process  that is  somewhat                                                               
similar to this.                                                                                                                
MS. PARKER  explained that is  the section  of law that  they are                                                               
amending  with SB  145. Before,  it  applied only  to the  normal                                                               
SENATOR  GREEN said  she was  concerned that  the block  of money                                                               
that  was  paid back  went  into  the  system,  not back  to  the                                                               
SENATOR  WILKEN asked  if this  was  a slippery  slope they  were                                                               
starting down  and what other groups  would be asking to  do this                                                               
in the future if teachers get it today.                                                                                         
SENATOR STEVENS said they already  started on that slippery slope                                                               
when they approved the commissioner to do this.                                                                                 
SENATOR  WILKEN asked  if the  state grader  operators were  in a                                                               
different system.                                                                                                               
MS. PARKER replied  that this law only applies to  the TRS. There                                                               
is a provision similar  to this in the PERS and if  you are a RIP                                                               
retiree, you cannot come back without paying the penalties.                                                                     
MR. KEVIN  SWEENEY, Legislative Liaison, Department  of Education                                                               
and Early Development (DEED), said he  might be able to shed some                                                               
light on  their questions. The  way to certify  teacher shortages                                                               
is under  current statute, which  allows someone who  didn't take                                                               
the RIP to return. It's the  same process. The board has to adopt                                                               
a  policy that  shows there  is a  shortage. They  report to  the                                                               
administrator  of  their  retirement  system.  Adding  the  RIP'd                                                               
teachers wouldn't affect the department at all.                                                                                 
Regarding the  two choices  when a teacher  comes back,  they are                                                               
only  talking about  choice number  two with  this bill,  because                                                               
choice number one  is already available to them -  that is coming                                                               
back, paying back  the RIP and continuing to  get their benefits.                                                               
This bill  gives them choice two,  which is to come  back and not                                                               
pay back  the RIP, not get  any new benefits and  continue to get                                                               
the retirement benefits.                                                                                                        
MR.  SWEENEY explained  for background  information that  in 2001                                                               
when the original  bill was passed allowing  school districts and                                                               
REAAs to  hire non-RIP'd teachers,  because of an  oversight, the                                                               
DEED was  left out, despite the  fact that they operate  a couple                                                               
of schools  in the state  and have the teaching  learning support                                                               
division. For  the most  part those  are certified  employees who                                                               
require certification.                                                                                                          
     The division  has had a  serious problem  with turnover                                                                    
     and  shortages. The  turnover  averages 45-55  percent.                                                                    
     Some positions have gone unfilled  for years at a time.                                                                    
     This bill  also clarifies  that the department  is able                                                                    
     to use  the hire of  non-RIP'd teachers in  addition to                                                                    
     letting them  take advantage of  the new  RIP'd policy,                                                                    
     if that is what the Legislature decides.                                                                                   
MR. TIM STEELE,  Vice President, Anchorage School  Board, said he                                                               
supported this  legislation saying in Anchorage,  they are having                                                               
a tough time in finding  teachers for certain specialties. Alaska                                                               
does not  prepare enough teachers  to hire within the  state. The                                                               
(NCLB)  standard requires  highly qualified  instructors for  all                                                               
courses. He said  that Anchorage teachers did  not participate in                                                               
the state  RIP program and  he didn't anticipate that  they would                                                               
use  this program  very  much,  but it  is  one  more option  for                                                               
SENATOR WILKEN  asked if  it was correct  that people  hired back                                                               
under SB 145 would not be represented by a bargaining unit.                                                                     
MR. STEELE replied that is his understanding.                                                                                   
SENATOR WILKEN  asked if  he would  not expect  negotiations that                                                               
take  place between  him and  the  bargaining unit  to include  a                                                               
class of people called RIP'd rehires.                                                                                           
MR. STEELE  replied that he would  not and said again  that their                                                               
numbers would be very small.                                                                                                    
MR.  BRUCE JOHNSON,  Association  of Alaska  School Boards,  said                                                               
they supported CSSB  145, although it's not a full  answer to the                                                               
teacher   shortage  issue.   He  informed   the  committee   that                                                               
recruitment that is currently going  on outside the state is very                                                               
expensive.  Recently, a  several  state study  suggested that  it                                                               
costs about  20% of whomever  you hire for recruitment  costs. He                                                               
also submitted  that it's  another way of  keeping people  in our                                                               
state and contributing to the  economy who otherwise might leave,                                                               
because they  are fairly youthful  and want to continue  in their                                                               
pursuit  of teaching  elsewhere. "Why  not keep  that talent  and                                                               
that service here in Alaska?"                                                                                                   
SENATOR LYDA GREEN commented:                                                                                                   
     I'm sorry  Bruce, I  didn't want to  say this,  but why                                                                    
     wouldn't we  expect people who  teach to work  like the                                                                    
     rest of  people who have  a lifespan of work  that goes                                                                    
     far  beyond the  age  of  43? I  think  it's a  bizarre                                                                    
     circumstance.  We can  take the  blame for  it; we  can                                                                    
     take the credit  for it. I think it's  a strange system                                                                    
     that anyone is encouraged to retire.                                                                                       
MR. JOHNSON said  that debate would probably occur. He  is 55 and                                                               
still working.  He wished he  was one of  those 43 year  olds and                                                               
not working, but  he's not. He said that most  people are working                                                               
far beyond  their mid-40s;  it's just if  they participated  in a                                                               
RIP, which was an opportunity for  them, have chosen to leave our                                                               
state and are providing service elsewhere.                                                                                      
     Let's  keep more  of  those people  here  who may  have                                                                    
     rested  for two  or  three years  and  done some  other                                                                    
     things  and decided  teaching is  really their  calling                                                                    
     more long-term than they originally thought.                                                                               
SENATOR WILKEN asked Senator Gary Stevens if he would object to                                                                 
a five-year sunset.                                                                                                             
SENATOR GARY STEVENS replied that a 2005 sunset was already in                                                                  
there on page 4, line 28.                                                                                                       
SENATOR WILKEN moved to pass CSSB 145(STA) from committee with                                                                  
individual recommendations and zero fiscal note. There were no                                                                  
objections and it was so ordered.                                                                                               

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