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JOINT LEGISLATIVE COMMITTEE ON PUBLIC
EMPLOYEE BENEFITS REFORM
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FINAL REPORT - issued November 15, 2006, revised December 1, 2006
EXECUTIVE SUMMARY
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View/Hear Meetings
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Establishment
The Joint Legislative Committee on Public Employee Benefits Reform was created
by Assembly Concurrent Resolution No. 3. It is the duty of
the committee to review and formulate proposals that address abuses
of the system of benefits provided to public employees and to control
the costs of the State and its political subdivisions for public
employee retirement, health care and other benefits. As a basis
for its deliberations, the committee will use the recommendations
of the Benefits Review Task Force contained in its December 1, 2005
report, as well as other relevant reports.
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Committee Members
Senator Nicholas P. Scutari
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Co-Chair
Assemblywoman Nellie Pou
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Co-Chair
Assemblyman Thomas P. Giblin
Assemblyman Kevin J. O'Toole
Senator Ronald L. Rice
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Committee Aides
| Pamela H. Espenshade, OLS Aide |
(609) 292-9106 |
| George J. LeBlanc, Senate Democratic Aide |
(609) 292-5215 |
| Christian Martin, Senate Democratic Aide |
(609) 292-5215 |
| Olga Betz, Senate Republican Aide |
(609) 292-5199 |
| Laurine Purola, Senate Republican Aide |
(609) 292-5199 |
| Aaron Binder, Assembly Democratic Aide |
(609) 292-7065 |
| Karina Fuentes, Assembly Democratic Aide |
(609) 292-7065 |
| John Kingston, Assembly Republican Aide |
(609) 292-5339 |
| Jerry Traino, Assembly Republican Aide |
(609) 292-5339 |
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Reports
FINAL REPORT - issued November 15, 2006, revised December 1, 2006
EXECUTIVE SUMMARY
Meeting Transcripts
Transcription of Committee Meeting
- 8/9/2006
Transcription of Committee Meeting
- 8/23/2006
Transcription of Committee Meeting
- 8/24/2006
Transcription of Committee Meeting
- 8/31/2006
Transcription of Committee Meeting
- 9/13/2006
Transcription of Committee Meeting
- 9/19/2006
Transcription of Committee Meeting
- 10/12/2006
Transcription of Committee Meeting
- 10/18/2006
Transcription of Committee Meeting
- 10/25/2006
Transcription of Committee Meeting
- 11/27/2006
Transcription of Committee Meeting
- 12/7/2006
Written Testimony Submitted to Committee
October 18, 2006
Presentation Submitted on November 13, 2006
Letters Submitted
October 12, 2006
September 19, 2006
August 9, 2006
Resources
Legal Opinion Provided for the JOINT LEGISLATIVE COMMITTEE ON PUBLIC EMPLOYEE BENEFITS REFORM
- 8/23/2006
Prepared by the Office of Legislative Services
Division of Pensions and Benefits Response to Questions Raised by the Committee at the August 31, 2006 Meeting
- 9/26/2006
Prepared by the New Jersey Division of Pensions and Benefits
Reforming the State Health Benefits Program for Local Employers
- 10/6/2006
Prepared by NJ League of Municipalities, NJ Council of County Colleges, NJ School Boards Association and the NJ Association of Counties
Suggestions for Legislative Reforms for Part Time Employees Enrolled in the Pension System
- 10/5/2006
Prepared by the NJ Institute of Local Government Attorneys
Legal Opinion Re: Limitations on the Ability of the Legislature to Reduce Retirement Benefits Provided to Public Employees Under Certain Pension Systems
- 8/24/2006
Prepared by the Office of the Attorney General
Division of Pensions and Benefits Response to Questions Raised by the Committee at the August 9, 2006 Meeting
- 8/28/2006
Prepared by the New Jersey Division of Pensions and Benefits
List of Research Resources Provided for the JOINT LEGISLATIVE COMMITTEE ON PUBLIC EMPLOYEE BENEFITS REFORM
- 8/9/2006
Compiled by the Office of Legislative Services
Division of Pensions and Benefits Response to Questions Raised by the Committee at the August 24, 2006 Meeting
- 9/15/2006
Prepared by the New Jersey Division of Pensions and Benefits
Presentations
Comparative Benefits for Public Workers: Unlocking the Truth through Indexing
- 10/18/2006
Presented by Communications Workers of America (CWA) Local 1033
New Jersey State Health Benefits Program
- 9/13/2006
Presented by Frederick J. Beaver, Director of the New Jersey Division of Pensions and Benefits
State of the State Pension Systems
- 8/24/2006
Presented by Frederick J. Beaver, Director of the New Jersey Division of Pensions and Benefits
Presentation
- 8/9/2006
Presented by Frederick J. Beaver, Director of the New Jersey Division of Pensions and Benefits
New Jersey Alternate Benefit Program: Overview
- 8/31/2006
Presented by Frederick J. Beaver, Director of the New Jersey Division of Pensions and Benefits
Defined Benefit Plans Versus Defined Contribution Plans
- 8/31/2006
Presented by William A. Reimert, Consulting Actuary, Milliman USA
New Jersey Transit: Transition from Defined Benefit Pension Plans to Defined Contribution Pension Plans
- 8/31/2006
Presented by H. Charles Wedel, Chief Financial Officer and Treasurer, New Jersey Transit
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| The following legislation relevant to the topics
being studied by this special committee has been introduced in the 2006-07
legislative session
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PENSION ENROLLMENT THRESHOLD
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S986
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Increases eligible compensation level for enrollment in TPAF to $5,000.
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S1507
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Increases from $15,000 to $25,000 annual compensation PERS retiree may earn in PERS-covered employment without reenrollment.
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A1196
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Increases from $15,000 to $25,000 annual compensation PERS retiree may earn in PERS-covered employment without reenrollment.
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S2113
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Increases enrollment threshold in PERS and TPAF to $10,000.
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A160
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Changes compensation trigger for reenrollment of PERS retiree from $15,000 in aggregate to $15,000 per public employer.
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A450
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Increases eligible compensation level for enrollment in TPAF to $10,000.
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A3146
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Increases enrollment threshold in PERS and TPAF to $10,000; changes definition of compensation used to calculate benefits in PERS, TPAF, PFRS, SPRS, and JRS to average annual compensation of all service years.
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RETIREMENT SYSTEM MEMBERSHIP FOR LEGISLATORS AND OTHERS
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A3465
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Eliminates membership in the legislative part of PERS for future members of the Legislature.
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S2283
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Prohibits enrollment in PERS of public employee who is also public contractor; requires member to designate only one position as basis of enrollment.
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PENSION CREDIT AND ENROLLMENT FOR PART-TIME PUBLIC EMPLOYEES
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S2178
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Eliminates membership in various State-administered retirement systems for part-time public employees and elected officials commencing service after enactment; clarifies that part-time public employees and officials are ineligible for employer-paid health care.
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A3509
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Eliminates membership in various State-administered retirement systems for part-time public employees and elected officials commencing service after enactment; clarifies that part-time public employees and officials are ineligible for employer-paid health care.
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A118
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Requires part-time service by new PERS members to be credited at one half the length of that service for certain benefit calculation purposes.
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A3021
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"Part-time Public Employees and Elected Officials Pension Reform Act" ends retirement system enrollment for Legislators and part-time public employees and elected officials commencing service after enactment.
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PUBLIC EMLOYEES HOLDING MORE THAN ONE POSITION
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S718
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Provides that PERS member holding more than one position covered by PERS has to designate one position as the basis for enrollment.
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A119
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Provides that PERS member holding more than one position covered by PERS has to designate one position as the basis for enrollment.
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S726
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Requires legislators with simultaneous PERS-covered elected office or employment to choose one position for receipt of PERS credit.
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A696
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Requires legislators with simultaneous PERS-covered elected office or employment to choose one position for receipt of PERS credit.
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S1943
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Requires PERS designate position providing least compensation, for member holding concurrent positions, as compensation base for contributions and pension calculations.
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A3012
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Requires PERS designate position providing least compensation, for member holding concurrent positions, as compensation base for contributions and pension calculations.
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S1945
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Requires legislators to designate one covered position of elected office or employment for PERS credit.
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A527
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Requires legislators to designate one covered position of elected office or employment for PERS credit.
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S2061
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Permits elected officials and legislators with simultaneous PERS-covered elected office or employment to choose only one position for receipt of PERS credit.
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A3403
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Permits elected officials and legislators with simultaneous PERS-covered elected office or employment to choose only one position for receipt of PERS credit.
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A3543
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Requires current and new PERS members holding more than one position covered by PERS to designate one position for PERS credit.
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A3549
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Requires new PERS members holding more than one position covered by PERS to designate one position for PERS credit.
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S2283
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Prohibits enrollment in PERS of public employee who is also public contractor; requires member to designate only one position as basis of enrollment.
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AGE FOR UNREDUCED EARLY RETIREMENT PENSION BENEFIT
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S2036
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Changes age of eligibility for TPAF and PERS early retirement option without benefit reduction from 55 to 60 for new enrollees.
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A3475
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Changes age of eligibility for TPAF and PERS early retirement option without benefit reduction from 55 to 60 for new enrollees.
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A3498
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Changes age of eligibility for TPAF and PERS early retirement option without benefit reduction from 55 to 60 for new enrollees.
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DEFINITION OF COMPENSATION FOR PENSION CALCULATIONS
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S2176
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Changes prospectively definition of compensation used to calculate benefits in PERS and TPAF to average of five highest-paid years and in PFRS, SPRS, and JRS to average of three highest-paid years.
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A3507
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Changes prospectively definition of compensation used to calculate benefits in PERS and TPAF to average of five highest-paid years and in PFRS, SPRS, and JRS to average of three highest-paid years.
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S2179
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Provides that public employee pension benefits are calculated on base salary exclusive of various forms of extra compensation.
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A3510
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Provides that public employee pension benefits are calculated on base salary exclusive of various forms of extra compensation.
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A3146
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Increases enrollment threshold in PERS and TPAF to $10,000; changes definition of compensation used to calculate benefits in PERS, TPAF, PFRS, SPRS, and JRS to average annual compensation of all service years.
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COMPENSATION INCREASES BEFORE RETIREMENT
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S719
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Changes calculation of PERS retirement allowances for certain members who receive significant compensation enhancement within five years of retirement.
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A3547
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Provides for calculation of retirement allowance based on average annual compensation for ten years of service for certain PERS members who retire after enactment.
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A3548
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Provides for calculation of retirement allowance based on average annual compensation for ten years of service for certain PERS members who enroll after enactment.
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PENSION BENEFIT FOR SURVIVORS
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A2528
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Provides retirement allowance option to surviving spouses of deceased vested PERS and TPAF members.
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FORFEITURE OF PENSION BENEFIT
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S67
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Imposes mandatory terms of imprisonment and forfeiture of pension and retirement benefits for public officers or employees convicted of certain crimes involving or touching their office or employment. *
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A958
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Imposes mandatory minimum terms of imprisonment and forfeiture of pension and retirement benefits for public officers or employees convicted of crimes involving or touching their office or employment.
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A3404
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Imposes mandatory terms of imprisonment and forfeiture of pension and retirement benefits for public officers or employees convicted of certain crimes involving or touching their office or employment.
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S153
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Requires that public officers or public employees convicted of crimes involving their office or employment be sentenced to mandatory prison terms and forfeit pension benefits.
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A1921
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Requires that public officers or public employees convicted of crimes involving their office or employment be sentenced to mandatory prison terms and forfeit pension benefits.
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S825
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Provides for mandatory forfeiture of retirement benefits of elected official convicted of crime involving office held.
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A957
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Provides for mandatory forfeiture of retirement benefits of elected official convicted of crime involving office held.
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S1252
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Limits criteria to be considered in evaluating forfeiture of pension benefits involving elected official.
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S724
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Establishes new standard and procedure for forfeiture of elective public office for accepting illegal contributions; removes illegal contribution threshold for such forfeiture.
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A699
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Establishes new standard and procedure for forfeiture of elective public office for accepting illegal contributions; removes illegal contribution threshold for such forfeiture.
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A2842
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Requires forfeiture of public office upon conviction of fourth degree crime or higher; disqualifies person from future office upon conviction of fourth degree crime or higher or conviction of crime involving dishonesty.
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NEW DEFINED CONTRIBUTION RETIREMENT SYSTEM
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A2772
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Increases various penalties for violations of the pension laws.
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S2180
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Creates defined contribution program for elected officials and certain appointed public officials.
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A120
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Establishes Defined Contribution Public Employees' Retirement Program.
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PENSION STUDY COMMISSIONS
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S1501
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Establishes State-Administered Retirement Systems Study Commission.
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A680
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Establishes State-Administered Retirement Systems Study Commission.
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A121
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Establishes Public Employees' Defined Contribution Plan Study Commission.
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AJR118
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Creates Pension Enhancements Study Commission.
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MANDATORY SHBP PARTICIPATION
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A1218
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Requires local boards of education to join SHBP; requires State to pay SHBP costs for board employees; requires property tax relief in amount of savings by boards on health care benefit costs.
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A3095
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Requires local boards of education to join SHBP.
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COST SHARING FOR HEALTH CARE BENEFITS
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S1147
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Authorizes county colleges to establish cafeteria plans; requires establishment of cafeteria plans and collective negotiation of waiver terms prior to offering employees incentive to waive health care benefits.
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S2163
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Permits local employers in SHBP to negotiate benefits and cost sharing with employees; permits local employers to offer incentives to employees for waivers of SHBP coverage; requires annual independent review of SHBP.
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S2173
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Changes payment obligation of State and other public employers for SHBP coverage for employees and dependents to no more than 90 percent of SHBP cost.
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A3499
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Changes payment obligation of State and other public employers for SHBP coverage for employees and dependents to no more than 90 percent of SHBP cost.
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S2174
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Provides State and local governments will pay 90 percent of cost of post-retirement SHBP benefits for future retirees.
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A3504
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Provides State and local governments will pay 90 percent of cost of post-retirement SHBP benefits for future retirees.
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A553
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Allows local employers in SHBP to negotiate premium payments with unions.
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WAIVER OF HEALTH CARE BENEFITS
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S1153
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Permits certain county and municipal employees to waive benefits coverage under the State Health Benefits Program when covered by a spouse's benefits plan.
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S1476
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Allows counties and local contracting units to offer incentive to waive SHBP coverage to employees eligible for other health care coverage.
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A2846
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Allows counties and local contracting units to offer incentive to waive SHBP coverage to employees eligible for other health care coverage.
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S1516
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Allows school boards to offer incentive to waive SHBP coverage to employees eligible for spouse's health care coverage.
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A1860
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Allows school boards to offer incentive to waive SHBP coverage to employees eligible for spouse's health care coverage.
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S2163
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Permits local employers in SHBP to negotiate benefits and cost sharing with employees; permits local employers to offer incentives to employees for waivers of SHBP coverage; requires annual independent review of SHBP.
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HEALTH BENEFITS FOR PUBLIC EMPLOYEES WITH MULTIPLE POSITIONS
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S1125
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Prohibits certain elected officials from receiving dual health benefit coverage.
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A1691
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Prohibits certain elected officials from receiving dual health benefit coverage.
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S2175
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Requires that public employees who are married or with domestic partners receive health care benefits from only one public employer.
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A3503
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Requires that public employees who are married or with domestic partners receive health care benefits from only one public employer.
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A122
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Prohibits elected officials and public employees from enrolling for health benefits with more than one public entity; provides civil action for treble expenses by public entity providing additional coverage.
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A1681
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Prohibits certain elected officials and appointed officers from receiving dual health benefit coverage.
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CONTRACT FOR SHBP PRESCRIPTION DRUG BENEFIT
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S1577
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Provides that separate contract must be awarded for pharmacy benefit management services in connection with SHBP drug prescription benefits.
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MEDICAL SAVINGS ACCOUNT FOR SHBP
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A2586
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"Medical Savings Account Option Act" for SHBP.
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SUPPLEMENTAL COMPENSATION AT RETIREMENT FOR UNUSED LEAVE
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S679
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Prohibits certain terminal leave compensation for local elected officials.
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S681
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Requires repayment of terminal leave sick and longevity compensation upon reemployment with State or local government.
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S720
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Limits payment for certain supplemental compensation and accumulated vacation leave upon retirement for certain local government employees.
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S970
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Limits certain supplemental compensation upon retirement for local government employees to a maximum of $15,000.
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S1747
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Caps supplemental compensation for unused sick leave for school administrators at $15,000.
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A1521
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Caps supplemental compensation for unused sick leave for school administrators at $15,000.
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S1873
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Limits leave and supplemental compensation benefits for school district superintendents, assistant superintendents, and school business administrators; provides procedures and penalties for enforcement of TPAF provisions.
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A3011
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Limits leave and supplemental compensation benefits for school district superintendents, assistant superintendents, and school business administrator; provides procedures and penalties for enforcement of TPAF provisions.
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A530
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Prohibits supplemental compensation for unused sick leave for public school employees with an annual salary of $100,000 or more.
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A2873
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Prohibits supplemental compensation for unused sick leave for public school and municipal employees with annual compensation of $100,000 or more.
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A2887
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Limits payment to certain public employees for accumulated sick leave upon retirement; requires fine and reprimand or termination for violation of sick leave by public employee.
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S2324
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Limits payment to $15,000 for accumulated sick leave upon retirement for local public employees.
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SICK LEAVE INJURY PROGRAM
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S1992
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Terminates sick leave injury program for State employees injured after July 1, 2006 or upon expiration of current collective negotiation agreement.
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A3502
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Terminates sick leave injury program for State employees injured after July 1, 2006 or upon expiration of current collective negotiation agreement.
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S2238
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Terminates sick leave injury program for certain State employees injured after January 1, 2007 or expiration of current collective negotiation agreement.
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PUBLIC EMPLOYEE LEAVE
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S2172
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Permits unused vacation and sick leave by public employee to be carried forward for one year only; requires unused administrative leave to be cancelled.
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A3496
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Limits administrative leave to three days and reduces number of paid holidays from 13 to 10 for State and local government employees.
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A3497
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Permits unused vacation and sick leave by public employee to be carried forward for one year only; requires unused administrative leave to be cancelled.
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PUBLIC EMPLOYEE WORK HOURS
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S2170
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Provides that regular work week of all newly-hired full-time State or local government employees will be 40 hours.
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A3495
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Provides that regular work week of all newly-hired full-time State or local government employees will be 40 hours.
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STATE EMPLOYEE VACANCY AND REDUCTION
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S2160
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Requires reduction in number of State employees to FY2000 level; establishes procedure to control creation of new State positions and filling of vacancies.
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A3482
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Requires reduction in number of State employees to FY2000 level; establishes procedure to control creation of new State positions and filling of vacancies.
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S1114
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Establishes Vacancy Review Board in the Department of Personnel to review continued need for positions in Executive Branch that become vacant.
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A377
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Establishes Vacancy Review Board in the Department of Personnel to review continued need for positions in Executive Branch that become vacant.
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PUBLIC EMPLOYEE COMPENSATION
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S1966
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Reduces compensation of members of Legislature by 15%.
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A3402
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Reduces compensation of members of Legislature by 15%.
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S2177
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Prohibits payments of public employee bonuses not directly contingent upon achieving certain performance goals.
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A3505
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Prohibits payment of public employee bonuses not directly contingent upon achieving certain performance goals.
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A2896
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Limits compensation and contracts of State and local government officers and employees.
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A3363
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Requires DOP to generate compensation guidelines to help counties and municipalities determine appropriate pay for various positions.
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A3544
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Prohibits receipt of compensation or benefits for multiple elective public offices held.
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SHBP PLANS
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S2282
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Makes certain changes to State Health Benefits Program.
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A3618
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Makes certain changes to State Health Benefits Program.
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