After a tense and sometimes hostile week’s worth of negotiating, House and Senate lawmakers have cut a deal to reform the public pension system.
New Hampshire Public’s Radio’s Dan Gorenstein reports.
From the moment lawmakers entered the negotiation room in the morning, more than one person had the look of -let’s just get this whole thing done.
After the Conference Committee members signed off there was little cheer, or satisfaction.
Instead lawmakers, lobbyists and retirees shared quick hugs to mark the ordeal they had experienced.
TAPE: This is hard work.
But Senator Peter Burling- who led the Senate team- accepted the old axiom- ‘no pain no gain.’
He was so proud of the work, he called this compromise another step towards the resurrection of the retirement system.
:29 we have now avoided the devastating impact of 53% increases on municipalities. We have put in place an essential transfer of funds, we have dealt with the medical subsidy. We have created the two commissions that need to give us the next piece of work.
The compromise also includes a 1.5% cost of living increase that will be compounded for retirees.
Both House and Senate members had expected to reach an agreement late Friday afternoon.
But over the past four days the roadblock to compromise had been a small provision to limit pension checks for a very small minority of beneficiaries.
House members wanted a cap to eliminate so-called ‘golden parachutes’ that boosted certain employees final pensions.
The Senate fought the change- arguing the promise of good pensions is a necessary recruiting tool.
Ultimately, the two sides agreed that anyone hired after July 1st 2009 couldn’t get a pension that exceeds $120,000.
As expected, neither labor nor cities and towns were completely satisfied with the compromise.
Maura Carroll, who represents the Municipal Association wanted to see the conference committee adopt more long-term changes.
Provisions like eliminating employee control over the Board of Trustees and requiring police and firefighters to retire at age 50 instead of 45.
:33 those are the sorts of things that really need to be addressed. And there have been some movements forward. But there is a lot more work that needs to be done. And it’s frustrating that with this window of opportunity we couldn’t achieve more.
One reform that Carroll and others hail is the creation of an investment committee.
That committee will be made up of two board members, and three non-board members who are appointed by the Governor and Executive Council.
The new committee will be responsible for hiring and working closely with money managers and financial consultants.
Committee members must have some financial background to be appointed.
Employees like the idea of getting more expertise on the investment side of the retirement system.
At the same time, New Hampshire AFL-CIO President Mark Mackenzie is concerned under this plan, retirees lose benefits.
Cost of living increases at least theoretically won’t be as rich, and an 8% annual increase for health benefits has been eliminated.
TAPE: if there is a system that provides a certain benefit when you leave, and ten years down the road, based on the cost of living, the benefit has eroded it puts people at a disadvantage. There has to be a place where retirees can go. And have medical insurance at affordable rates. And those are two goals, if we can accomplish them, really moves us down the field.
The bill does establish two commissions to study cost of living increases and the health subsidy benefit.
House Speaker Terri Norelli says when dealing with such a substantial overall of the public pension system, it makes sense that both sides feel a little pain.
TAPE: this problem was decades in the making. And in just one Legislature, we have gone a very long way to making sure the NHRS is sound, stable....it will protect the future for our retirees, and it will protect the taxpayers from significant increases.
But before anyone is protected, the Senate and House must first vote on the deal.
Even if the plan is approved, nobody believes the end to shoring up the public pension system is close at hand.
For NHPR News, I’m DG.
