A wide-ranging retirement bill that contains a controversial provision giving senators full benefits after 12 years of service is headed back to committee for debate.
Last week the Senate was to take testimony from the Government Employees Retirement System on the bill, which would amend the current retirement law. But the session was adjourned after the retirement provision for senators stirred heated debate.
President Vargrave Richards said Wednesday that the bill will now be reassigned to the Committee on Government Operations for "public hearing and full debate." He did not say when hearings would take place.
The 100-plus-page retirement bill, drafted by GERS, seeks to shrink the system’s $300 million unfunded liability through a myriad of changes and to give administrators more flexibility in bringing in higher investment earnings.
But the section regarding senators’ retirement benefits has caused an uproar throughout the territory. The bill would give senators their full $65,000 a year salary after serving six two-year terms, regardless of age. Currently, senators can draw their retirement pay when they are 50 years old.
Additionally, senators who have served five terms would receive 90 percent of their pay after 10 years; 80 percent after eight years; and 60 percent after six years.
Currently, senators receive 2.5 percent of their yearly pay for each year of their first six years in the Legislature; 3 percent for years seven through 12; and 4 percent for each subsequent year.
Richards likened the controversy around the Senate retirement provision to "fireburn." The entire bill shouldn’t be discarded because of the one section, he said, noting that the bill could be amended in committee hearings. Some senators are "inclined to get rid of" the provision, he added.
"We don’t think it’s wise to gut the entire bill because of this one section," Richards said. "There are other portions of this bill that have been lost in the discord."
Some of them include allowing GERS members to sue the government if it doesn’t make its contributions to an employee’s pension, authorizing GERS to invest in securities with a BBB-bond rating or better rather than the current A rating, raising the mortgage ceiling from $75,000 to $200,000 and from $30,000 to $50,000 on land loans, allowing GERS to set cost-of-living-increases, and allowing the GERS board of directors to invest in real estate and borrow money without Senate approval.
Richards noted that the entire bill, including retirement provisions for senators, has been discussed over the "last several months," including seven meetings with GERS.
"This has been no secret," he said.
Nine majority-bloc senators, including Richards, signed on as co-sponsors of the entire bill. In committee Wednesday, Sen. Adlah "Foncie" Donastorg, also a co-sponsor, ripped into his colleagues for "trying to pass the buck" on the issue. He said he was in favor of eliminating entirely retirement benefits for senators.
"I can’t wait for this issue to get on the floor," he said. "All hell will break loose."
