Retirement – Our Highest Priority Should be the Viability of Our State
by Representative David Litvack
Minority Leader in the Utah House of Representatives
The Utah Legislature is about to consider whether or not to make major changes to the Utah Public Employee Retirement System. Senator Dan Liljenquist, R—Bountiful, is proposing a set of bills that would dramatically reform retirement compensation to public employees. One of Liljenquist’s proposals would do away with the state’s defined pension system as we know it today for individuals hired after July 1, 2011.
I believe this is the wrong approach, and that making a major change such as this one is not in the best interest of Utah’s future. Advocates for Utah’s state employees have called upon the Senator to slow down, study the issue very carefully, and proceed with caution. I agree with them. There are many things at stake, and while some changes to the employee pension system may be necessary and prudent, our highest priority must be the economic viability of our state, not only for today, but also for the future.
I applaud the Senator’s recognition that we have contractual obligations to current employees, and his efforts to ensure they are not affected by this legislation. That is an important and meaningful gesture. We know that many Utah families have seen difficult times during our current economic downturn. Utah’s public employees have been no exception. As a state, we are facing huge budget deficits. Many of Utah’s teachers, police officers, firefighters, those who protect the most vulnerable, etc. have been required and will be required to take days off without pay. Some may even lose their jobs as we cut budgets and begin our recovery from this recession. We are continuing to ask public employees to do more with less and they are living up to the challenge.
What concerns me most, however, is Senator Liljenquist’s insistence that we absolutely must rush to a decision this legislative session. I believe that a change as major as this one needs greater input and a more open and collaborative process. We must consider the opinions and perspectives of legislators, stakeholders, public employees, universities, future college graduates, and the public in general. Coming to solutions together requires a much more cooperative and engaging process, much like what we have done in our state health care reform efforts. In our discussions, we need to ask one question: “What does a major change like this mean for the future of our state?”
It is my belief that Utah’s future stability relies on our ability to hire and retain the best teachers, police officers, fire fighters, etc. With the proposed changes on the table, what would Utah’s future workforce look like? Would our compensation and benefits package be enough to encourage a career in public service? Or, would state employment be considered as a launching pad to other opportunities? When public service is viewed this way, institutional knowledge can be lost and the efficiency of state agencies could be compromised.
Public employment in Utah must remain a viable career option. Therefore, I strongly encourage my colleagues in the Utah Legislature to slow down and engage all stake holders more thoroughly and responsibly, so that we can keep the Utah Retirement System strong for all public employees – now and in the future.
Thank you for this well thought out response! You have great vision. I hope that others of both parties will slow down and truly study the issue. Sincerely, Pam Bunderson
Thank you for your opposition to the proposed changes to public employee retirement benefits. It is good to see that the Democratic Party is supporting UT public employees.
I would like to emphasize that the proposed changes do not leave the original employer/employee agreements intact and could have a profound impact on employees currently in the public safety system. If the option to retire from one agency and then rehire with another agency, while continuing to collect one’s pension, is removed, this will have a significant impact on employees who have invested 10, 15 or even 20 years into the retirement system. The option to retire/rehire is typically viewed as the reward for years of substandard wages. It is not uncommon for police officers in other urban areas to attain pay rates, after serving 2-3 years (or even less), that are higher that what a 20 year veteran in the Salt Lake Valley earns. The retire/rehire option is one way to recoup some of this difference. Until the substandard pay rates are addressed, the retire/rehire option should not be altered.
Further, when an officer retires/rehires, the officer will give up the benefits he has earned over the course of his career to start back at, or near, the bottom. This means a lower base pay rate, lower rates of accrual for vacation/sick time, and likely middle of the week days off. For some officers, the financial benefits of retiring/rehiring offset these other sacrifices. However, it is likely that most officers would prefer to be earning a higher wage throughout their careers, thus making the retiring/rehiring option less palatable and hopefully rendering it unnecessary.
It is also clear that the passage of SB43 and SB63 would provide an incentive for an employee, who has reached the required years of service and wishes to remain in public service – in any capacity – whether in the same field or another, to seek employment in another State.
Thank you again for your opposition to these bills. Your service is appreciated.
John,
Thank you for your good comments and information. Utah House Democrats will stand behind Utah's public employees on this issue.
Fight the good fight!