Monthly update

I just wanted to give all of you a brief update regarding what has been happening with employee issues. Also, August is employee appreciation month. I want to invite all of you to our employee appreciation days that will be held at 3 locations:
1. 8/13, Salt Lake Government Center 11:30-1:30;
2. 8/20, Salt Lake County Public Works, 6:00 am -8 am;
3: 8/27, Salt Lake County Jail, 1:00-3:00.

Retirement
The national financial crisis has caused pension systems and 401(k) plans to lose money. The Utah Retirement System (URS) was no exception. The Utah public employee pension lost approximately $4 billion last year. During the next legislative session, URS may ask to increase the contribution rates by 3 to 4% ($80 - $100 million). However, lawmakers will decide between various options that affect public employee retirement benefits.

In April 2009, UPEA created a task force to monitor potential changes to the system, since legislators began examining a defined contribution system for employees. URS presented several options for consideration during a February 5, 2009 Legislative committee meeting. URS’s legal council, Dan Anderson said, “URS isn’t making any recommendations regarding changes, they are only bringing forth information as a place to begin discussions for making adjustments to the system, if desired by the committee.” Some of the proposed adjustments are listed below. Please keep in mind that none of these proposals are final. However, as public employees, we need to be educated on each of the alternatives so we can make a difference in the process.

UPEA has been very busy this summer working on the retirement issues. The UPEA task force is discussing all options and will use the information they have gathered to educate legislators regarding public employee retirement issues. In addition, the Legislative Retirement and Independent Entities committee will be meeting to discuss retirement issues next month. At this meeting, they are scheduled to discuss the options related to retirement issues. Once this meeting takes place UPEA will send out a broadcast email relaying the information that was discussed. The options that have been talked about as possibilities include:

Suspend/Lower Post Retired (“Double Dippers”) contribution to 401(k). Utah currently has a very generous post-retirement (“double dipping”) benefit policy. There is political momentum to change the benefit for the employees that “double dip” to save money. The concern is whether or not any changes can be legally made to the current employees using the post-retirement benefits.
Extend final Average Salary Period (i.e. from 3 years to 5 years). This proposal would allow the average of the highest 5 years to be used in calculating your retirement benefit.
Make COLAs Discretionary/ Delay COLA. COLA’s on retirement disbursements could potentially be deferred until a specific anniversary date of retirement (i.e. 3 years after retiring) or until a retiree reaches a certain age (i.e. 65).
Increase the vesting period. Vesting periods for new employees could potentially increase (i.e. from 4 years to 6 years).
Put a minimum age condition on the 30 year benefit. One of the suggestions is to change the minimum age that an employee can retire without penalty (55,57,60,etc…). The question is how would this apply to current employees? Would they be grandfathered?
Partial benefit payments until certain age. This proposal would allow for an employee to receive partial retirement benefits until they reach a certain age (phased retirement). Reduce the multiplier. Reducing the retirement multiplier (number of years x 2% x average salary) from 2% to 1.9%. The question is whether current employees would be grandfathered.
Increase 20 year public safety and firefighter requirement to 25 years. Would current employees be grandfathered?
Put a minimum age condition on the 20 year public safety and firefighter benefit (48, 50 , 52, etc…). One of the suggestions is to change the minimum age that an employee can retire without penalty (48, 50, 52,etc…). Would current employees be grandfathered?Change to the contributory system. Employees are currently on the non-contributory system. Such a move would allow employees to participate in funding their retirement benefit. Such a move would shift some of the risk to the individual.
Create a hybrid contributory/non-contributory system. This would allow the system to potentially have the employee participate in funding their retirement benefit, while still having part of their benefit be made up of the non-contributory system.
Make the retirement benefit optional – employees can choose how they would like to participate at the time of hire.
Turn the defined benefit system (pension) into a defined contribution (401 (k)) system.
Basing your retirement eligibility by age + years of service. This proposal would say that you would need to follow the rule of 85 (or 90, 95, etc…). This would mean that you would need to have 30 years of service if you were to retire at the age of 55 (age + years of service = 85).

Again, let me emphasize that nothing has been made final. However, UPEA is actively lobbying to protect your retirement. (Source: The Utah Public Employee. UPEA Newsletter. August 2009)

Salt Lake County Specific Issues
Over the course of the past couple of months, one thing has really resonated regarding employee issues in the county. The budget. As noted in previous emails, UPEA met with Mayor Corroon to discuss his proposed changes to the budget for 2009 and 2010. Mayor Corroon indicated that he was going to pull the !% salary cut off of the table for 2009. We are very concerned about the 2010 budget. All indications are pointing to a possible 7.5% total budget cut in 2010, which is fairly significant. UPEA is dedicated to keeping employees in their jobs, as well as protecting benefits and compensation.

In addition, the UPEA Salt Lake Valley Local Government District is beginning to put together a list of legislative priorities for the year. If you have any suggestions of what UPEA should pursue this year, please let me know.

Upcoming Events:
I will be in the following locations as indicated. If you have any questions, or would like me to come to your office to discuss items of concern with you and your co-workers, please don’t hesitate to contact me.
8/11 - Transfer Station Q&A, 12:00-2:00
8/13 – Public Employee Appreciation Day – Salt Lake County Government Center – 11:30-1:30 (There will be hot dogs, chips, drinks, and prizes!)
8/18 – Salt Lake County Jail Q&A, 1:00-3:00
8/19 – Environmental Health, Ice Cream Social, 1:00-2:30
8/20 – Public Employee Appreciation Day – Salt Lake County Public Works – 6:00 am – 8:00 am (Breakfast and prizes!)
8/24 - Salt Lake Public Health Clinic Q&A - Room 200 - 11:30 - 1:30
8/26 – District Meeting Youth Services Administration, Main Conference Room- 12:00 - 1:00
8/27 – Public Employee Appreciation Day – Salt Lake County Jail – 1:00-3:00 (There will be hot dogs, chips, drinks, and prizes!)
Again, if you have any questions, comments, suggestions, etc…, please don’t hesitate to contact me. My door is open. In addition, if you would like me to come to your location and attend a staff meeting, hold a Q&A, please call or email me.

Thanks for all you do!