“The bill that the Senate originally passed actually removed any incentive for individuals to retire,” Meadows said. “We changed the nature of the bill and made it better for retirees.”

The bill passed 59-45.

The new bill, if passed by the Senate, would provide an increased pension multiplier. The multiplier helps determine monthly pensions by taking into account salary and time employed.

Currently at 1.5 percent, the Senate bill proposed raising the multiplier to 1.6 percent for teachers who retire between July 1 and Sept. 1 this year. The House revision proposes raising this multiplier further to 1.7 percent for those who retire between June 15 and July 1 this year and 1.6 percent for those who retire between July 1 and Oct. 1.

Meadows said he expects the incentives will motivate about 20,000 teachers to retire. Most of these positions would be available to new hires who cost less.

“(Graduates) have all the training that’s necessary; we just don’t have the jobs right now for young people, and this will open up a lot of opportunities for them,” Meadows said.

State Rep. Bill Rogers, R-Brighton, said the original plan would have saved the state money, but the new proposal eliminates significant savings.
“They got rid of what could have been reform and savings,” he said.

The combination of these financial changes in the bill will result in smaller savings for the state, which faces a $1.7 billion projected deficit for the next fiscal year, said Bethany Wicksall, a legislative aide at the House Fiscal Agency.

However, the savings depend on how many teachers choose to take the retirement package. If 50 percent of eligible teachers retire, savings are projected at $1.3 billion during 10 years, Wicksall said. If 75 percent of eligible teachers retire, savings are projected to be lower, at $500 million during the next 10 years. In general, the more employees that choose to retire, the lower the savings for the government.

To participate in the retirement program, teachers have to be at least 55 years old with 30 years of service. Under the House’s version of the bill, eligible teachers will be expanded to include those whose combined age and years of service total 80, for those who retire between June 15 and Oct. 1.

The original Senate bill included a hybrid retirement pension and 401K plan for new employees hired after July 1. The revised House proposal eliminates this portion of the bill all together.

Conferees from both the Senate and the House were appointed Tuesday and are expected to resolve the conflicts in the proposed legislature.
Rogers expects action on the bill soon, so public schools can plan how many teachers to rehire for the next school year.

“It is important to actually produce something that is going to be law,” Rogers said, “so we don’t keep putting all these (school employees) in limbo.”