ISTA-Retired Update on TRF COLA

FYI ISTA-Retired From Jerry Ervin PLEASE READ AND ACT
Subject: ISTA-Retired Update on TRF COLA

I just received this information from Roni Embry. I'm sure she will tell us more when she gives the legislative update to us at our meeting on Monday. However, I asked that she give us an update right away. Although this COLA (cost of living adjustment) will give us less money in the short term, raising the basic benefit, rather than a 13th check, will benefit retirees over the long term. Please share this with your members and contact your legislators to ask that they support the TRF/PERF COLA.

The House Ways and Means Committee passed HB 1231 - Pension Cost Of Living Adjustments. The bill passed the House Employment, Pensions and Labor Committee unanimously before it was recommitted to Ways and Means. Now it is alive in the full House and is up for 3rd reading and final passage on Monday, February 3rd.

Please contact your Representative and ask them to vote YES on providing a COLA to TRF/PERF retirees.

The bill provides a cost-of-living adjustment (COLA) to retirees in the PERF/TRF pension funds. The COLA would be provided for one year with a determination on a yearly basis afterwards.
Details of the COLA increase are:

• 1.5% COLA to a member who retired before January 1, 1983
• 1% COLA to a member who retired after December 31, 1982 and before January 1, 1995
• 0.5% COLA to a member who retired after December 31, 1994

The original bill provided a COLA increase of 3%, 2% and 1% respectively, but it was curtailed in Ways and Means.

There has been no COLA since 2008. Although a “13th check” has been provided in the years since, the amount does not compound with the base as it does with a COLA. There is also a 13th check bill, HB 1074 (Rep. Woody Burton, R-Whiteland), still moving in the House.

The state has a history of providing “catch up” funding to offset a decline in retirees’ purchasing power combined with inflation. Fiscal analysis shows that the fund is in good shape. In fact, actuarial projections also figure a 1% COLA each year, but the longer the legislature waits to provide it, the more likely it is that the percentage will decrease

Sherry Watkins

Course Change on Annuity Accounts

October 21, 2013

Dear ISTA Members,

We want you to know that today's meeting of the Pension Management and Oversight Commission (PMOC) went well. Much of what happened today is the direct response to your thoughtful communications with members of the Commission.

Today, PMOC members sent a unanimous message about the direction it supports - not to privatize this annuity work but, instead, to find a better balance between what INPRS believes it needs and the needs of its members.

Today's motion from the Commission's final report reads:

1. The Commission considered the four proposals considered by the INPRS Board regarding the issuance of annuities to retirees for their ASAs.
2. The Commission recommends that INPRS pursue an option that would keep the annuitization of ASAs in-house and to not proceed with a 3rd party contract. Instead INPRS should periodically establish an interest rate that will not create an unfunded liability in their managed funds.
3. The Commission recommends the General Assembly not set a statutory interest rate at this time.
4. The Commission recommends that the date to undertake these activities occur not earlier than October 1, 2014.

Basically, the recommendation calls for NO PRIVATIZATION and that INPRS continue to annuitize in-house in a way that will not create an imbalance between what INPRS promises and what it can earn in investments.

This is a "non-binding" recommendation, but carries weight inasmuch as PMOC oversees the work of INPRS. INPRS will meet this Friday and it is hoped that INPRS will take new action to reflect PMOC's recommendations.

The reason for the Oct. 1, 2014 implementation date is to ensure that school employees interested in retiring next summer can do so under the current retirement system.

ISTA will continue to work to make positive impacts on behalf of members. Please stay tuned. We will keep you informed.

Please take time to thank Sen. Karen Tallian for her leadership on this issue and for offering her motion. Also, take time to thank the other legislative members of PMOC for voting for it.

Chairperson: Sen. Phil Boots (R-Crawfordsville): s23@in.gov
Sen. Gregory Walker (R-Columbus); s41@in.gov
Sen. Karen Tallian (D-Portage); s4@in.gov
Sen. Lindel Hume (D-Princeton); s48@in.gov
Rep. Jeff Thompson (R-Lizton); h28@in.gov
Rep. Woody Burton (R-Whiteland); h58@in.gov
Rep. Chuck Moseley (D-Portage); h10@in.gov
Rep. David Niezgodski (D-South Bend); h7@in.gov

ISTA knows this is a high-interest topic and will continue to hold its retirement workshops around the state as originally scheduled.

News from the RA

The NEA-RA is in full swing this week. The following was posted on the NEA Web Site...

NEA-Retired Delegates’ Commitment to Education Continues
By Emma Chadband and Cindy Long

It’s estimated that almost 90 percent of NEA members leave the association when they retire, but delegates to this year’s NEA-Retired Annual Meeting are determined to bring that number down by bringing their numbers up.

“Retire from your position, not your profession,” said NEA-Retired President Tom Curran in his address to the 2012 NEA-Retired Annual Meeting in Washington, D.C.

Curran said the NEA weathered a political storm last year – budget cuts, threats to bargaining rights, and layoffs – and that the upcoming year won’t be any easier, which is why NEA retired members need to organize, advocate, and recruit. The message was well-received -- the crowd at the NEA Retired conference Wednesday seemed fired up and ready to fight for education and educators’ rights.

“Work hard in the upcoming elections. Our future depends on you,” Curran said. “We can’t outspend [other groups], but we can out work them.”

Curran thanked a few states for their hard work in protecting unions, including Ohio, for restoring collective bargaining rights, and Michigan, because the state is collecting signatures for a referendum to put collective bargaining in the state constitution.

Curran also talked about the recent controversies in Wisconsin. The governor’s race was such a spectacle, and Walker had to outspend the other side to such a degree, that politicians will probably think twice about attacking union rights again, he said. John Lehman, a former teacher and retired NEA member, was also elected to the state Senate and helped give Democrats the Senate majority.

The NEA-Retired President’s message to NEA Retired members was clear: get involved, because this is going to be a busy year for the NEA. He thanked everyone who had already written letters to the editors of their local newspapers or made phone calls for pro-union legislators, and encouraged people to stay involved in political races.

NEA President Dennis Van Roekel, who addressed the NEA-Retired delegates on Thursday, emphasized the importance of the upcoming presidential election.

“We want the world to know that our members understand the importance of this election to educators, to labor, and to social justice,” he said. “And I believe the choice for us and for America is very clear.”

It took just two years, Van Roekel said, for conservative legislators and their corporate backers to attack or dismantle payroll deduction, agency fees and collective bargaining. It would take even less time for a conservative-controlled federal government to enact a national right-to-work law.

“We’ve got to accept that we have a new reality, and choose a path forward,” he said. “We can’t just defend ourselves, we have to go on the offense, and be clear about our goal – which is great public schools. With a defense and an offense, we’ll be stronger than ever before.”