Among the proposed changes:
• Longer work requirements on most governmental employees and educators before they can retire with full benefits. The change will apply to workers hired in the future, but not law enforcement and firefighters. The proposal is to take effect in July 2011, but the bill left in language stating that the changes apply to workers hired starting in July 2010.
• Restrictions on state and local government workers who retire and then return to work in a governmental job.
• Increased pension fund payments by state workers and educators during the next two years.
The change will mean a reduction in take-home pay and has drawn sharp criticism from unions representing governmental and school workers.
• Higher payments by governmental employers and workers over four years to a financially troubled program that provides health care for retirees and their dependents.
A driving force behind some of the pension legislation is concern over the long-term financial stability of the state's two large pension funds: the Public Employees Retirement Association, which covers state and local government workers, and the Educational Retirement Board's pension program. Pension funds have been hit with large investment losses recently because of the financial market meltdown.
The legislation also establishes a task force to recommend to the Legislature by October 2010 what needs to be done to ensure the long-term solvency of pension plans. It's possible that lawmakers could revisit and alter the retirement eligibility changes approved this session.
Tuesday, March 31, 2009
Public pensions take a hit from New Mexico Legislature
New Mexico state employees will see pension changes in coming years from a handful of measures recently approved by the state legislature.