Posted December 7, 2011
Alert distributed to members from Rich Nagel
The Joint Committee on Public Retirement and Social Security Programs of the Arkansas General Assembly has been conducting a series of informational meetings across the state. The next meetings will be held in your area on December 12 and 13 as follows:
December 12, 2011, 4:30 – 6:30 p.m., Jonesboro, AR
ASU Fowler Center
Riceland Hall
201 Olympic Drive
December 13, 2011, 9:30 – 11:30 a.m., Jonesboro, AR
Hilton Garden Inn
2707 Fair Park Blvd.
The first day's meeting will be held in the afternoon and will consist of informational presentations by each retirement system director, along with a Q & A session. On the following day, the Committee will conduct its regular business meeting.
The Arkansas Education Association (AEA) and the Arkansas Teacher Retirement System (ATRS) members are encouraged to attend one of these meetings, which will be a great opportunity to meet various legislators and allow members to hear directly from them. Your input is important to the development of this legislation. Don't miss this opportunity to let your voice be heard.
State Legislative Retirement Committee members have stated that the four retirement issues listed below will not be presented in the upcoming fiscal legislative session, but will likely be introduced and discussed in the 2013 legislative session.
1. Elimination of Teacher-Deferred Retirement Option Plan (T-DROP): ATRS has had a T-DROP for a number of years. Many members have used it successfully to prepare for retirement and to enhance their monthly retirement benefits. T-DROP has been used by ATRS to promote the retention of experienced teachers and educators. The data compiled by ATRS establishes that T-DROP has been effective in achieving the goal of retaining experience in delivering educational services to Arkansas citizens. At this time, T-DROP does not add cost liability to ATRS, and based upon studies, it may actually save the ATRS money.
2. Retirees' Benefits and Active Members' Retirement Account Information - Published and Available for any Citizen to View: ATRS members’ individual account information and retirement benefits are exempt from public disclosure. Based upon recent statements in the media, legislation may be introduced that would mandate that ATRS release each member’s retirement account information upon the request of any citizen. Elimination of this exemption will allow anyone to obtain, view, publish and use each ATRS member’s data for any purpose once it is released. Depending upon how the potential proposal is written, the information that could be obtained on any member could be extensive. The information could include the member’s retirement option choices, the member’s monthly benefit, the member’s participation in T-DROP and other programs, the member’s T-DROP balance, the member’s final average salary calculation, the member’s beneficiary elections, and other similar information.
3. Prohibiting Retirees from Returning to Work and Eliminating Monthly Retirement Benefits during Reemployment: ATRS staff has been notified that either or both of these proposals will be introduced at the first available opportunity. Currently, there are over 4,000 retirees who have returned to work at an ATRS employer. The retirees are performing work that includes full and part-time work. The work includes substitute bus driving, substitute teaching, administration, full-time teaching, especially in the critical shortage licensure areas and other support staff work. Often, in certain parts of the state, finding a qualified teacher to finish a school year is difficult, if not impossible, without the use of retirees.
In the 74-year history of ATRS, retirees have always been allowed to return to work to ensure that experienced, qualified and capable educators have been able to provide the delivery of educational opportunities to Arkansas citizens. In many instances, the re-employment of retirees ensures educational continuity for students.
Since 2009, ATRS has actually benefitted from retirees being rehired. Now that an ATRS employer must pay a 14% contribution on a rehired retiree, ATRS can apply the entire contribution to reduce the liabilities of the retirement system.
4. Reduction in the ATRS 3% Annual Simple Cost of Living Adjustment (COLA): A shell bill (a bill containing just a title and no additional language) to amend the 3% COLA was introduced in 2011 legislative session, and it was not considered by lawmakers. ATRS and AEA anticipate a proposal to reduce the COLA to a lesser amount. It is important to note that the ATRS retiree COLA is a simple adjustment and not a compounded one. This means that the annual 3% COLA is based upon the retiree’s annuity amount at the time of his or her retirement, and it is not based on the retiree’s current annuity
ATRS tracks the relative spending ability of ATRS retirees over time. The 3% simple COLA has allowed ATRS retirees to maintain relatively stable spending ability overtime. The ATRS has seen its COLA as another means of retaining quality educators to remain in the public schools. One of the goals of ATRS remains to reward career educators with a quality retirement benefit.
ATRS staff members and AEA leaders and staff members will be at all of the regional meetings. If you attend a regional meeting, please introduce yourself to the ATRS and the AEA staff in attendance. We look forward to meeting with you there.
Posted October, 2011
Letter distributed to members.
Memorandum
To: AEA Members
From: Donna Morey, AEA President
Rich Nagel, AEA Executive Director
Re: Four potential proposals that significantly alter your retirement
Date: October 4, 2011
George Hopkins, the Executive Director of the Arkansas Teachers Retirement System (ATRS), recently sent a written update on, “potential legislative proposals that could materially affect the benefits and retirement laws for ATRS members.” Hopkins noted that, “these proposals are not proposals of the ATRS Board.” Hopkins went on to write that, while it is very early to consider legislative proposals, the recent focus on public employee retirement benefits and laws has given rise to serious consideration of four proposals by members of the Arkansas General Assembly.
The Arkansas Education Association (AEA) shares the ATRS Director’s concerns about the proposals that appear headed for serious consideration by the Arkansas General Assembly. ATRS staff and the AEA want to ensure that retirement system members and ATRS employers are aware of these proposals in the early stages to allow members and employers to provide input while the shape and scope of the proposals are being considered.
Exactly what is introduced in the General Assembly will be significantly shaped by input from ATRS members and the general public before the session. Your opinion and input are important to members of the General Assembly. The Public Retirement Committee is holding regional meetings across Arkansas to make it easier for ATRS members and the public to attend legislative meetings on retirement issues. The Public Retirement Committee wants to obtain input from citizens throughout Arkansas.
The first two regional meeting for ATRS members and ATRS employers to express their views on the four possible proposals were held on September 20 and 21. Over 120 AEA members attended the open meeting and voiced their opposition to the possible proposals.
The next two meetings will be held in Arkadelphia. Scheduled for Monday, October 17 at 4:30 to 6:30 p.m. at the DeGray Lodge in the Caddo Room and Tuesday, October 18 at 10:00 a.m. at Henderson State University in the Garrison Center - Ross Room. The last publicized meeting dates are scheduled for Jonesboro, Arkansas on December 12 and 13. As soon as the times and places for these meetings are determined, AEA will send the information to area members.
The four potential proposals addressed in Director Hopkin’s update include:
1. Elimination of Teacher-Deferred Retirement Option Plan (T-DROP): ATRS has had a T-DROP for a number of years. Many members have used it successfully to prepare for retirement and to enhance their monthly retirement benefits. T-DROP has been used by ATRS to promote the retention of
experienced teachers and educators. The data compiled by ATRS establishes that T-DROP has been effective in achieving the goal of retaining experience in delivering educational services to Arkansas citizens. At this time, T-DROP does not add cost liability to ATRS, and based upon studies, it may actually save the ATRS money.
2. Retirees' Benefits and Active Members' Retirement Account Information - Published and Available for any Citizen to View: ATRS members’ individual account information and retirement benefits are exempt from public disclosure. Based upon recent statements in the media, legislation may be introduced that would mandate that ATRS release each member’s retirement account information upon the request of any citizen. Elimination of this exemption will allow anyone to obtain, view, publish and use each ATRS member’s data for any purpose once it is released. Depending upon how the potential proposal is written, the information that could be obtained on any member could be extensive. The information could include the member’s retirement option choices, the member’s monthly benefit, the member’s participation in T-DROP and other programs, the member’s T-DROP balance, the member’s final average salary calculation, the member’s beneficiary elections, and other similar information.
3. Prohibiting Retirees from Returning to Work and Eliminating Monthly Retirement Benefits during Reemployment: ATRS staff has been notified that either or both of these proposals will be introduced at the first available opportunity. Currently, there are over 4,000 retirees who have returned to work at an ATRS employer. The retirees are performing work that includes full and part-time work. The work includes substitute bus driving, substitute teaching, administration, full-time teaching especially in the critical shortage licensure areas and other support staff work. Often, in certain parts of the state, finding a qualified teacher to finish a school year is difficult, if not impossible, without the use of retirees.
In the 74 year history of ATRS, retirees have always been allowed to return to work to ensure that experienced, qualified and capable educators have been able to provide the delivery of educational opportunities to Arkansas citizens. In many instances, the re-employment of retirees ensures educational continuity for students.
Since 2009, ATRS has actually benefitted from retirees being rehired. Now that an ATRS employer must pay a 14% contribution on a rehired retiree, ATRS can apply the entire contribution to reduce the liabilities of the retirement system.
4. Reduction in the ATRS 3% Annual Simple Cost of Living Adjustment (COLA): A shell bill (a bill containing just a title and no additional language) to amend the 3% COLA was introduced in 2011 legislative session, and it was not considered by lawmakers. ATRS and AEA anticipate a proposal to reduce the COLA to a lesser amount. It is important to note that the ATRS retiree COLA is a simple adjustment and not a compounded one. This means that the annual 3% COLA is based upon the retiree’s annuity amount at the time of his or her retirement, and it is not based on the retiree’s current annuity.
ATRS tracks the relative spending ability of ATRS retirees over time. The 3% simple COLA has allowed ATRS retirees to maintain relatively stable spending ability overtime. The ATRS has seen its COLA as another means of retaining quality educators to remain in the public schools. One of the goals of ATRS remains to reward career educators with a quality retirement benefit.
ATRS staff members and AEA leaders and staff members will be at all of the regional meetings. If you attend a regional meeting, please introduce yourself to the ATRS and the AEA staff in attendance. We look forward to meeting with you there.
Note: During the Rogers meeting, Members of the Joint Committee stated that during upcoming Fiscal Session none of the issues would be addressed, however the meetings around the state remain scheduled.
September 23, 2011
Arkansas Teacher Retirement and AEA share concerns about potential legislative action against the system.
George Hopkins, the Executive Director of the Arkansas Teachers Retirement System (ATRS), recently sent a written update on, “potential legislative proposals that could materially affect the benefits and retirement laws for ATRS members.” Hopkins noted that, “these proposals are not proposals of the ATRS Board.” Hopkins went on to write that, while it is very early to consider legislative proposals, the recent focus on public employee retirement benefits and laws has given rise to serious consideration of four proposals by members of the Arkansas General Assembly. The Arkansas Education Association (AEA) shares the ATRS Director’s concerns about the proposals that appear headed for serious consideration by the Arkansas General Assembly. ATRS staff and the AEA want to ensure that retirement system members and ATRS employers are aware of these proposals in the early stages to allow both to provide input while the shape and scope of the proposals that are being considered.
Issues presented to the General Assembly will be significantly shaped by input from ATRS members and the general public . Your opinion and input are important to members of the General Assembly. The Public Retirement Committee is holding regional meetings across Arkansas to make it easier for ATRS members and the public to attend legislative meetings on retirement issues.
The Public Retirement Committee wants to obtain input from citizens throughout Arkansas. The first two regional meeting for ATRS members and ATRS employers to express their views on the four proposals are scheduled for Monday, October 17 from 4:30 p.m. to 7:00 p.m.; the second meeting is scheduled for Tuesday, October 18 at 10 a.m. Both meetings will be held at Degray Lodge, near Arkadelphia and Highway 7. Director Hopkin’s update includes the four potential proposals :
1. Elimination of Teacher-Deferred Retirement Option Plan (T-DROP): ATRS has offered T-DROP for a number of years. Many members have successfully used T-DROP to prepare for retirement and to enhance their monthly retirement benefits. ATRS has used T-DROP to promote the retention of experienced teachers and educators.
The data compiled by ATRS establishes that T-DROP has been effective in achieving the goal of retaining experience in delivering educational services to Arkansas citizens. At this time, T-DROP does not add cost liability to ATRS, and based upon studies, it may actually save the ATRS money.
2. Retirees' Benefits and Active Members' Retirement Account Information - may be published and available for any citizen to view or print: ATRS members’ individual account information and retirement benefits are exempt from public disclosure. Based upon recent statements in the media, legislation may be introduced that would mandate that ATRS release each member’s retirement account information upon the request of any citizen. Elimination of this exemption will allow anyone to obtain, view, publish and use each ATRS member’s data for any purpose once it is released. Depending upon how the potential proposal is written, the information that could be obtained on any member could be extensive. The information could include the member’s retirement option choices, the member’s monthly benefit, the member’s participation in T-DROP and other programs, the member’s T-DROP balance, the member’s final average salary calculation, the member’s beneficiary elections, and other similar information.
3. Prohibiting Retirees from Returning to Work and Eliminating Monthly Retirement Benefits during Reemployment: ATRS staff has been notified that either or both of these proposals will be introduced at the first available opportunity. Currently, there are over 4,000 retirees who have returned to work at an ATRS employer. The retirees are performing work that includes full and part-time work. The work includes substitute bus driving, substitute teaching, administration, full-time teaching especially in the critical shortage licensure areas and other support staff work. Often, in certain parts of the state, finding a qualified teacher to finish a school year is difficult, if not impossible, without the use of retirees.In the 74 year history of ATRS, retirees have always been allowed to return to work to ensure that experienced, qualified and capable educators have been able to provide the delivery of educational opportunities to Arkansas citizens. In many instances, the re-employment of retirees ensures educational continuity for students.Since 2009, ATRS has actually benefitted from retirees being rehired. Now that an ATRS employer must pay a 14% contribution on a rehired retiree, ATRS can apply the entire contribution to reduce the liabilities of the retirement system.
4. Reduction in the ATRS 3% Annual Simple Cost of Living Adjustment (COLA): A shell bill (a bill containing just a title and no additional language) to amend the 3% COLA was introduced in 2011 legislative session, and it was not considered by lawmakers. ATRS and AEA anticipate a proposal to reduce the COLA to a lesser amount. It is important to note that the ATRS retiree COLA is a simple adjustment and not a compounded one. This means that the annual 3% COLA is based upon the retiree’s annuity amount at the time of his or her retirement, and it is not based on the retiree’s current annuity.
ATRS tracks the relative spending ability of ATRS retirees over time. The 3% simple COLA has allowed ATRS retirees to maintain relatively stable spending ability overtime. The ATRS has seen its COLA as another means of retaining quality educators to remain in the public schools. One of the goals of ATRS remains to reward career educators with a quality retirement benefit.
ATRS and AEA members, leaders and staff will be at all of the regional meetings. If you attend a regional meeting, please introduce yourself to the ATRS and the AEA staff in attendance. We look forward to meeting with you there.
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