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Public pension overhaul clears Legislature

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Posted: Wednesday, March 13, 2013 7:00 am | Updated: 8:25 pm, Thu Mar 14, 2013.

A proposal to shore up the long-term finances of a pension system for state and local government workers in New Mexico cleared the Legislature on Wednesday and heads to Republican Gov. Susana Martinez.

The measure addresses one of the largest financial problems confronting state government. The governor plans to review the bill before deciding whether to sign or veto it, according to a spokesman.

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Welcome to the discussion.

3 comments:

  • Algernon Moncrief posted at 10:21 am on Wed, Mar 27, 2013.

    Al Moncrief Posts: 1

    COLORADO COURT OF APPEALS CONFIRMS COLORADO PERA PUBLIC PENSION COLA BENEFITS AS CONTRACTUAL.

    The Colorado Court of Appeals has reversed and remanded an initial District Court ruling that denied the contractual status of public pension COLAs in Colorado. The Court of Appeals confirmed that Colorado PERA pension COLA benefits are a contractual obligation of the pension plan Colorado PERA and its affiliated public employers. A huge victory for public sector retirees in Colorado!
    The Colorado Legislature may not breach its contracts and push taxpayer obligations onto the backs of a small group of elderly pensioners.

    The lawsuit is continuing. Support pension rights in the U.S. by contributing at saveperacola.com. Friend Save Pera Cola on Facebook!

    In 1977, the U.S. Supreme Court (in U.S. Trust Co, 431 U.S.) clarified that state attempts to impair their own contracts, ESPECIALLY FINANCIAL OBLIGATIONS, were subject to greater scrutiny and very little deference because the STATE'S SELF-INTEREST IS AT STAKE. As the court bluntly stated:

    “A governmental entity can always find a use for extra money, especially when taxes do not have to be raised. If a state could reduce its financial obligations whenever it wanted to spend the money for what it regarded as an important public purpose, the Contract Clause would provide no protection at all . . . Thus, a state cannot refuse to meet its legitimate financial obligations simply because it would prefer to spend the money to promote the public good rather than the private welfare of its creditors."

    For more resources to protect public pension benefits visit saveperacola.com.

     
  • Lou Mead posted at 7:58 pm on Sat, Mar 16, 2013.

    Lou Mead Posts: 5

    Not all who belong to the AARP share your sentiments, so you really don't speak for the masses. As a retiree of the state, I stayed in NM and worked for wages far less than what I could have made in another state. I also made contributions that were more than I would have in other places. This so we could live close to family. For my chosen occupation, our family made sacrifices. At one point, we could have qualified for public assistance. I was also only allowed to retire at 80% of salary, when, coupled with no wage increase for a number of years, made it undesirable to work beyond the maximum. In exchange, I was promised a lifelong retirement with a 3% cola raise, which would help offset some of the "low wage" syndrom we experienced. To tell me now that I need to share in a sacrifice because the pension people mismanaged the funds and didn't prepare for the future correctly is disingenous. If you go back and read previous works of the pera people, they have flipflopped and changed their tune on the numbers and the fund condition on a regular basis. I for one will be in line for the lawsuit if the pension bill is signed. It is not because I am greedy, nor is it that mometarily it will affect me a whole lot. It is principle. If they take a little now, next year they will want more. Fix the damn thing going forward like you should have done already and quit blaming and trying to punish people who have fulfilled their terms.

     
  • Bill Miller posted at 8:50 pm on Wed, Mar 13, 2013.

    Bill Miller Posts: 1

    SB 27 is a concoction of smoke and mirrors. Kane started out strong, indicating that a panel needed to be assembled to get the REAL amount of solvency. PERA solvency seems to be a moving target and with all the problems with PERA mismanaging the funds and not paying pensions correctly, who knows what the truth is? PERA consultants say the fund can pay out for over 50 years, but they had you believe in this session that the sky was falling and threatened that NM's credit rating would suffer. This is a new ploy to get the pensions changed, but they had to do something different to get this moving. In the end, when her amendments failed, Kane voted for the bill anyways. This was such a demonstration of weakness and lack of principle. What a disappointment.

     
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Key issues facing lawmakers

ECONOMICS

Backdrop: New Mexico gained only 1,700 jobs during the past year ending in November. That's a growth rate of 0.2 percent and the lowest in the region. New Mexcio's unemployment rate was 6.4 percent in November compared with 6.7 percent a year earlier.

Proposals: Gov. Susana Martinez proposed expanding programs that can help bring nurses, dentists and other medical providers to rural areas. She also wants to provide $7.5 million for an endowment fund to attract top porfessors and researchers at colleges and universities. The governor recommends broadening tax incentivies to encourage startup companies as well as research and development. Democrats are pushing to increase the stat's minimum wage, which has been $7.50 an hour since 2009. Some lawmakers want automatic cost-of-living increases in the wage rate.

BUDGET

Backdrop: The current state budget is $5.9 billion, and revenues are expected to reach nearly $6.2 billion in the fiscal year starting in July. That provides about $239 million in "new money" for lawmakers and the governor for budget increases and to offset tax cuts. The state has cash reserves of more than $500 million, but that could shrink because of accounting discrepancies stretching back more than six years.

Proposals: Martinez has recommended a 3 percent budget increase compared with about 4 percent proposed by the Legislative Finance Committee. Martinez proposes targeted increases for hard-to-fill jobs such as state police. But the legislative panel advocates across-the-board raises for all state agency workers and educators, with higher amounts for those in certain jobs, including judges, state police and social workers.

INFRASTRUCTURE

Backdrop: About $600 million in bond financing is available for capital improvement projects. Some of that goes for specific purposes, including public schools and projects on tribal lands. However, much of the financing will be divvied up for new projects. 

Proposals: Martinez proposes earmarking about $112 million in bond proceeds for water projects across the state. The governor also recommends creatinga  new fund that can provide emergency assistance to communities with drinking water problems. The Legislative Finance Committee has recommended $10 million in bond financing for highway maintenance and $6 million for a road to the state's spaceport.

EDUCATION

Backdrop: Public schools, colleges and universities get nearly $3 out of every $5 in the operating budget. The high school graduation rate was 70 percent in the last school year, and nearly half of graduates enrolling in state colleges in 2011 and 2012 required remedial courses.

Proposals: Martinez will renew a proposal to require schools to hold back third-graders who can't read proficiently. Some Democrats and a coalition of social advocacy groups want to earmark part of the yearly payout from a state permanent fund to provide more money for early-childhood education. Lawmakers also will consider ways to shore up a lottery-financed college scholarship program. Some proposals would change the program to make the aid need-based and provide a flat dollar amount for scholarships. 

The Associated Press

Session dates - 2014

• December 16, 2013 - January 17 Legislation may be prefiled

• January 21 Opening day (noon)

• February 5 Deadline for introduction

• February 20 Session ends (noon)

• March 12 Legislation not acted upon by governor is pocket vetoed

• May 21 Effective date of legislation not a general appropriation bill or a bill carrying an emergency clause or other specified date

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