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MEA-MFT/R News:
Governor signs GABA!
MEA-MFT has accomplished a number of retirement victories in the 2001 session. First and foremost is House Bill 294, the 2001 guaranteed annual benefit adjustment (GABA) legislation. After nearly unanimous votes in both the House and Senate, HB 294 has been signed by Governor Martz.
MEA-MFT has worked tirelessly and constantly on this issue for many years. It is hugely important to all our members, K-12 teachers and
classifieds; state and county; Head Start; and higher education faculty and staff. Savor the victory!
Sponsored by Dave Lewis (R-Helena), HB 294 immediately increases GABA to 3 percent per year for pensions administered by the Public Employee Retirement System (PERS). The bill further authorizes the Teachers Retirement System (TRS) board to incrementally increase the TRS GABA to 3 percent over time as TRS assets permit.
In February, HB 294 passed the House 97 to 3. On March 13, it passed the Senate on voice vote approval. As we go to press, we anticipate it will easily pass Senate third reading.
Zero cost: HB 294 is entirely funded by assets of the various PERS and TRS pension funds. HB 294 has "zero cost" for taxpayers and the state general fund. And HB 294 does not increase public employer or employee contributions to the pension programs either today or in the future.
An existing PERS pension asset surplus fully pays for HB 294's immediate PERS 3 percent GABA. The TRS fund will be leveraged over time to fund HB 294's incremental TRS GABA.
Like a badly needed home improvement loan, HB 294 allows current TRS assets to extend the amortization period of the TRS fund to a period of slightly less than 25 years (more than actuarially sound). It can pay for an immediate .44 percent incremental increase (from 1.5 percent to 1.94 percent) in the TRS GABA. HB 294 then authorizes the TRS board to apply future TRS assets (as determined by the ordinary TRS biennial financial evaluations) to raise the TRS GABA to 3 percent over time.
HB 294 also establishes a partial inflation-protected "floor benefit" for pension programs administered by PERS and PERD. It raises the TRS minimum benefit for TRS retirees (or beneficiaries) from $500 to $600 per month so long as the retiree retired with 25-plus years of credited TRS service.
MEA-MFT 10th Annual Retirement Forum:
October 19: Belgrade, 8:00 a.m. to noon. Held in conjunction with MEA-MFT Educators' Conference. Check this site and MEA-MFT Today for details.
All workshops take place 4:15 p.m. to 8:00 p.m. Check with your local MEA-MFT President for location and details. Or contact Tom Bilodeau, MEA-MFT retirement coordinator at 1-800-398-0826, .
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