Assemblywoman Addie J. Russell (Theresa) announced that the Assembly passed Tier VI pension legislation that will reduce local government and district pension costs in the long run. The passage of the bill (A.9558) protects current public employees from layoffs and protects the solvency of the system. The legislation reflects some significant differences than what was in the Governor’s original pension reform proposal.
Changes from Tier V that will affect new public employees include:
· raising the retirement age to 63, which is lower than the Governor’s proposal of age 65;
· exempting workers making less than $45,000 annually from having to contribute more than the current 3 percent rate to their retirement, and adjust other employee contributions as follows:
o those earning $45,000-$55,000 at a rate of 3.5 percent;
o those earning $55,000-$75,000 at a rate of 4.5 percent;
o those earning $75,000-$100,000 at a rate of 5.75 percent; and
o those earning $100,000 or more at a rate of 6 percent.
· limiting the type of employee that can opt into the SUNY TIAA CREF plan to those who are classified as ‘exempt’ and earning over $75,000
· increases from 3 to 5 years the period of time used to calculate final pension benefits
“This plan requires public employees not already in the system to pay more toward their pensions based on a sliding scale," Russell said. "I believe this plan strikes a better balance than the original proposal when you compare the cost savings achieved versus compensation levels needed to continue to attract quality employees into public service," she continued. "However, should it become apparent that the balance is negatively impacting recruitment and retention of needed personnel, I will support revisiting these changes," she concluded.
-30-