 So hello, everyone. This is Senate Government Operations. It is Wednesday, January 19th, and today we are going to continue our discussion on the pension, and I think that we'll start by kind of debriefing what we heard last night in the public hearing. I was actually surprised there weren't more people, 12 people had signed up, only seven of them came, five of them did not join us. So I was surprised by the number. But does anybody want to start on the reflections? Because I have some reflections and I've also asked Chris Rup. Some of the statements that were made were not entirely accurate, and I've asked Chris to help us understand those. So would anybody like to start? Yes, Senator Calamare. Thank you, Madam Chair. Yeah, it lasted for those that aren't aware, about a half an hour last night, and I was equally surprised with both the initial response from the general public that we would only be talking with 12 people, but even more puzzled why five of them would sign up and then not show up. I didn't understand that. But from what I wrote down on my notes, six of the seven that did testify supported the overall task force report recommendations, I feel. There were little nuances in each of their responses, but for the most part they were very favorable. There was only one who was clearly not in favor of what the task force came up with, and asked us to vote no on the recommendation. So to me, that's pretty clear that there is what I will call widespread support in terms of what the work of the task force did, and that makes me feel pretty good about continuing with the work here. Anybody else have any observations that? Yeah, Senator Plena. Basically the same thing as Senator Collin Morgan. I think the one person who was negative, if I remember correctly said, I'm going to be working longer and paying more and getting less. I just put that out there because whether that's true or not, it doesn't seem to be other. Other people didn't seem to be saying that, but that was the only concrete example that somebody gave us to why they were not happy. They said, I'll be paying more and getting less, working more and getting less. So maybe, I'm going to go to Senator Ron Hinsdale, and then I'm going to point out the things that were said that I think maybe need some explanation from Chris. So Senator Ron Hinsdale. I think my big takeaway was that we have really noble and cooperative public servants who understand the situation before us and are while frustrated and understanding and feel good about the solution that's been presented, but really don't want to see us do this again, in 10 years and having parents who are looking forward to a pension from higher education work, they really plan to the day and the dollar. I think any certainty that we can give folks that this solution feels much different and more long lasting than past changes would be really helpful to communicate. Thank you, Senator Clarkson. Yes, I think my articulate colleagues have spoken well in summarizing this, the rather short, maybe the shortest public hearing I've almost ever been to. I guess what also impressed me is most of them had worked internally on the task forces in their labor unions. So the vast majority, I mean like three quarters of them were very intimately involved and engaged with the process, which was great, but I was really, I have to say, I was discouraged. We didn't hear from just more, you know, there are 20,000 people out there that might have wanted to weigh in. And I just, I guess I was a little disappointed by how few people showed up to weigh in on something so important that if we look at the concern and email volume we've gotten on this issue and the concerns that are raised with us when we're in the grocery store, so not reflected by the presence in the public hearing and that's great in a way because maybe that, but it means it leaves us to making assumptions that everyone's sanguine with it. You know, anyway, I'm just, but I would, that was my takeaway. I was surprised by an issue this important that we had so few people participate. So thank you. I'm going to point out a few things that I've, that were said that I've asked Chris to comment on and Chris did watch last night. So Chris, you have better things to do with your life. No, I don't, Madam Chair. No, I don't. Thank you. Anyway, so here's a couple of the comments that were made that I think need some explaining. First of all, there was the comment that the underfunding that had happened for the, this is around the teachers was a result of the legislative action and that we are not making that whole in this, in this proposal that they are still paying and suffering from that underfunding. So that was a comment and that from 10 years from now, we will be doing the same thing. There was also the comment that were whacking away at their pensions and I think that needs to be clarified and that they are being asked to solve the issue, the problems that they did not create and that the general assembly has put the onus on them to solve the issues, even the problems, even though they didn't create them and that they had to work longer for less benefit. So I guess that those were kind of the main comments that I heard that were negative and I would ask Chris, unless somebody else has other comments that they heard, I did send those to Chris, even though he said he watched it and asked him so that we can understand the clarification of those and how, what the weight that those comments made hold and if for anybody who's watching or who might watch this later can understand those comments in the full context. So Chris, would you, oh, yes, Senator Romancell. I guess if I feel like if we could add the concern that I felt like I heard a lot, please don't go back to the well in the near term, some sense of the difference between the agreement now and past agreements, we're barring some unforeseen major catastrophe beyond the level of this one that this will hold and make us a lot more sustainable going forward would be helpful. Yeah, I think that that came from a couple of them and the one person said from 10 years from now, we'll be back here doing the same thing. And I think that that, so Chris, if you can add in Senator Romancell's thoughts to your, that would be great, thank you. For the record, Chris from Joint Fiscal, thank you, Madam Chair. I'm gonna start by trying to run through the list and I would certainly invite the state treasurer to weigh in as well, but- I'm getting a lot of echo. I don't know who. All right. I'm afraid I think it's Chris because it only came, it happened when Chris was speaking. I have no other devices going. So I don't know if anybody has multiple devices. Is that better now? Okay, great. So- I think it was us. That's all right. So thank you, Madam Chair. I'll start off by just sort of going through the list of questions. And if I miss anything, feel free to ask again because I'm sort of doing this stream of conscious. But on the first point about the General Assembly that the proposal doesn't make up for past underfunding, the treasurer did a really helpful estimate for the task force, which was cited in the report to try to do a sort of back of the envelope estimate of how much of that teacher pension unfunded liability is due to past underfunding by the employer. And underfunding kind of means two things. One would be the state not paying the actuarially recommended amount. And that was something that happened frequently between 1979 and 2006, all but four years that the actuarially recommended amount was not fully paid. And the other piece pertains to the former OPEB practices of even though you may be making the actuarially recommended payment, if you're then using the assets of the pension fund to pay those OPEB costs, that has a similar effect of a contribution shortfall by adding to the unfunded liability. So that has been rectified moving forward. And part of the recommendation is actually to pre-fund those OPEB benefits for the first time and really shore up those benefits. But going back to the legacy underfunding, the combined impact of those two factors, the treasurer estimated, and I don't profess to speak to her, especially since she's here now and she can weigh in, but the conservative estimate was, I think that added roughly 350 million or so to the unfunded liability. That's less than a fifth of the system's unfunded liability. Something important to keep in mind is that the employer state government is making up for that past shortfall. We are paying that every year when you get your ADAC recommended amount from the actuaries, the cost of making up for that legacy shortfall is baked into that. So the state has been paying to make up for that. The state will continue to pay and make up for that in all of its future amortization payments, but $150 million or $125 million of one-time money is certainly a pretty significant down payment on addressing that piece of the unfunded liability and will save future interest costs. And you also need a factor in the impact of that ADAC plus over time. So I would say that that cost of that legacy underfunding is a cost that the state has shouldered and will continue to shoulder in the future. And it's sort of baked into the base payment that we have to pay every year. And something important to note about the ADAC is if there's a legacy, if the employer doesn't fully fund the ADAC payment one year, it doesn't mean there's just this hole that never gets filled. All of your future ADAC payments get recalculated to make up for that shortfall. So I know the treasurer uses the example of putting it on the state's credit card a lot and it kind of works that way. You know, if you don't fully pay it now, get the cost of that shortfall with interest gets baked into all of your future payments. Let's see a hand raised. Yeah. You know, I really understand that for the most part, it's not good to bind our hands in any way, right? Like states that have changed their budget so that 2% goes to this or whatever the case may be. Just wanna make sure we explore these arguments for ourselves and others. Are there any states that have successfully sort of tied themselves to the ADAC so that they don't borrow money from this payment in bad years and like sort of mortgage their own future? Has that been successful anywhere? So that we do really tie ourselves to what is sustainable going forward and don't put it into the system? If I may, I'd like to defer the treasurer because I see she had her hand raised, but I think it's difficult to bind the hands of future legislators in general, but... So if I may, just going back to the other question in terms of the amount. Chris is correct that the ADAC adjusts for that and adjusts for it over time because you amortize the difference that you haven't paid over a period of time. And we calculated at some place around 350 million with the healthcare included in that. It is a conservative estimate because we did not have healthcare data prior to 2001. It's kind of, as many of you know, the state changed its accounting system back in 2001 and things prior to that are a little money to say the least. So I think it's a little conservative. I think it's safe to say around 400 million. That included, as we said, the healthcare. And I do want to point out that some of this relates to decisions that we make back in 2014. We weren't even doing pay go with the teachers. We were putting it in on our credit card and they're not paying the credit card for that. And it literally took the air out of the sales for the pension system. And it was considered a sub fund at the pension system. So we moved it to its own budget in 2000, in fact of 2015 and got to pay go, which is a lot better than borrowing the money and putting that into a situation where it's really not paid back for a period of time and adding that to our credit card. From there, 2014, around 2018, our office started looking at ways to do the pay go. Excuse me, do the pre-funding. We actually recommended over that period from 2014 to about 2015. This gets to your question, Senator. But it did not pass through whether it was in the governor's budget or in the legislative budget. It was not passed. This year, the task force made a decisive opinion and something we applaud to pay the ADEX for the two health plans. The teacher, which we refer to as Arthur, Retired Teacher Medical Benefits Fund. So if you hear me say Arthur now and then, that's why in the state plan, which we don't have an acronym for, but we are looking to pay those, this is something. And I would just point out that the proposals that are there very definitely are similar to the ones that we presented in 2019, 2020, 2021 and 22. So from my perspective, the state now, and I do wanna compliment the state, we do pay the ADEX for pensions. We've been doing that since 2007. And again, getting to Chris's point, you can't bind a future legislature, but the statute does say that you will pay that over a period with the goal of paying that by 2038. You can certainly change the amortization period. You can extend it if you want, but that would require a statutory change. But since 2007, they now make the pension and with your proposal, the task force proposal for a 2023 budget, I presume it's a 23 budget. Now we're going to get to a position where we're pre-funding teacher healthcare. It is my hope that we don't abandon that and fund less than the total, but I think that you've made a commitment. I believe that commitment's going to happen. And I thank you for that commitment. But this state was not one that was passing the doing and it was a comment that was made earlier, was not paying the full ADEX. We are now since 2007. And I think that now, again, that 2007 to 2014, we are still not paying the healthcare, but we have moved into a process of paying the ADEX. Many states do. Many states are in healthier position in terms of their funded status. And I can think of a few, and a lot of them have not paid the amount of ADEX over time. And as a consequence, have very low funding levels. Chris might be familiar with the state that had that situation. I remember one state that was really proud in their budget because they got up to paying 30% of the ADEX. And for me, that's irresponsible. And that was not Chris' state, by the way. So a lot of states did not fully fund the ADEX, but a good majority did. And as a consequence, they're in better situation. Now, all of us suffered during the great recession and all of us lost assets, and we had to do some recovery. But I think that the discipline that you've exercised and worked toward and getting to this next pre-funding would be very helpful. I do wanna also comment, if I could, on one piece, which was the 2011 effort. We're never gonna get there again kind of thing. In 2011, the number was much smaller in terms of the amount, but the percentage of that that was passed in terms of legislation was actually higher than the percentage we have here. So they did their job, but the goal that was set was less, but they did have a higher percentage of success. So I do wanna put that out there because my predecessor and members of the legislature were very proud of the changes they made, and they should be proud. We can never predict the future with certainty. I'm gonna knock on wood, as I say, please, no more great recessions or anything like that. I definitely am knocking on wood. But we have to recognize that demographics change and we all have to work together. We have to exercise discipline, and the best way to do it is to pay the ADEC every year and make sure you have that discipline. I'm proud of the fact we now have that discipline, but we need to continue it. And my last comment, getting back to Chris's comments, the great reset, I mean, excuse me, the underfunding had nothing to do with the $604 million increase. It was part of the 400 million that exists now is part of the reason that they came in a little less funded or a lot less funded than the state system into the Great Recession, but it was not part of the $604 million increase by both systems in the 379 million in the teacher system. I just answered it with the principles of electricity instead of where the light switch is, but I wanted to respond to a couple of comments that I heard along the way and some of, and amplify in some of the comments that Chris made and I'll be quiet now. So thank you. So thank you, Beth. I just want to point out something that I think that as both Beth and Chris said, we can't really bind future legislators, but I think that, or this future legislature, if that's the way you want to put it, but I think the language in this compromise is as strong as it can be. And so that was very carefully worded to make it absolutely as strong as it can be. And I also will say that we talk about coming back here and back here and back here. And in 2009, we, in fact, there was a study and there were recommendations. Unfortunately, the union people were not involved in the study, in the meetings, and the recommendations came back, each part of them voted on separately, unlike what we're doing now, which is voting on a package. So if you look at that report, the 2009 report that the treasurer gave us, each recommendation was voted on separately and many of them, even the ones who were passed, many of them did not go back past the legislature because I believe the legislature did not have the political will to make those decisions and to take it on. So I think we're in a very, very different place now because people have been involved. The proposals came from the unions and there was give and take on both sides and it is a unanimous support from all 12 people. So I think we're in a very different place now than we have been in the past. So I just thought I'd make that comment. So Chris, did you have? No, I mean, I can keep moving through the list and the only final comment I would add to what Senator Ron Hinsdale asked and what the treasurer began to ask about, can you give some assurances that we're not gonna have another issue reoccur in the future? I mean, there's no guarantees in the future and we always are going to need to pay very close attention to how the world changes, how the outlook of the world changes, how behavior and experience are changing relative to the assumptions and adjust your assumptions when appropriate because the last thing you want is a system that has really overly rosy looking assumptions that experience is not going to meet. So it will look like the price costs X for the benefits and the price really could end up costing Y. So I think you all did a really important thing in when you passed Act 75 where you shortened the time period between experience studies from five years to three years, that's the opportunity where you take a look back and see how did your experience match your assumptions in the past, should the assumptions change moving forward? And that's when you really open the hood and take a look and see what's going on in the pension system. But if you go back to the 1980s or 1990s, we are in such a different monetary environment back then than we are now. And that has a direct impact on your cost of living adjustments, the assumed inflation rates, interest rates and what your assumed rate of return is gonna be. So the world changes for factors that are beyond our control. So I think we all need to acknowledge that and embrace it for what it is. The folks on the task force heard me throw a four letter word around a lot, risk. And that's what risk really means is that there's uncertainty about what's gonna happen in the future. So you have to always keep your ear to the ground, your finger on the pulse, if you will, and you try to make sure that the system is always in good shape because you don't want adverse trends to get ahead of you. You wanna make sure that you're always being realistic with your assumptions and you're making the fine tuning adjustments as you go. Having an expectation that nothing will ever change in the future on the future outlook is not setting yourself up for long-term success, quite frankly. So I'm gonna throw something out here that I know a lot of people might disagree with and I don't wanna get anybody hot under the collar. But we've heard a lot that the employees and the teachers were paying what they were required to pay and that is absolutely true. They were always paying what they were required to pay. The problem is that the normal costs were increasing and those contributions were not enough to cover those normal costs. So while they were paying what they were required to pay, it was inadequate. And why that happened is probably an accident of history that they started really low and then they just kind of built a little bit at a little bit and never reached the point where the normal costs were being covered by the employee contributions. And so the state was picking up the additional amount to cover the normal costs. So it is true that people were paying what they were required, but what we were requiring was not adequate. If I may Madam Chair, that's a very good characterization. And the way I would try to distill that in sort of one bullet point is the price of the benefit, the assumed price of the benefit increased over time to be more than what we thought it was in the past. And the reason why is due to the fact that our assumptions have changed a lot. When you go back 10 years, our assumed rate of return was very different than it is now. The economic environment was very different than it is now. So, and we've revised our demographic assumptions through the lens of some more experience. So you've made the plan trustees have done the right thing for the plan members by revising their assumptions. But the effect of that is that the price of the benefit increased. So would you, one of the comments that we heard was that they're gonna have to work longer for less. Yeah. Would you comment on that? I'd love to. So none of the recommendations require any active members to work longer, full stop. The only adjustment that is proposed in any of these recommendations that involves eligibility for normal, unreduced retirement is a recommendation that pertains to the judicial group. These are group D that newly elected or appointed judges as of July 1st, people who aren't even in the system yet, the normal retirement age would increase from 62 to 65. Based on the FY 21 valuation, there are exactly three retired group D members in the system right now who are younger than age 65. It is a group of people that enters the workforce at a later age than other groups and departs at a later age than other groups. Just as you can think about with the career trajectory of your typical judge is going to be different than your career trajectory for a typical state employee. But there are no recommended changes to the five year vesting requirement. There are no recommended changes that would require anybody to work to a later age or to a greater years of service. One provision that I do know of the recommendations that has caused a little bit of confusion that I'd like to clarify pertains to. These are group C, the law enforcement and public safety group. There is no or currently a member in group C is eligible for early, unreduced retirement at age 50 as long as they have at least 20 years of service. Virtually every group C member retires right around age 50. I think there's only about 12 active members who are between age 50 and age 55. The mandatory retirement age for group C is currently 55, does not require you to work till you're 55. It's just as long as you pass that 50 and 20 mark, you can leave with an unreduced benefit and virtually everyone does. The provisions of the recommendation that pertain to this, again, would not require anybody to work longer or to a later age or for additional years of service. The recommendations are actually a benefit enhancement over the current structure that would reward people for working additional years of service beyond age 50 with at least 20 years of service. The point at which they can currently leave with unreduced benefits now. So I just wanna clarify that that is a, right now under the current situation, if you out of the goodness of your heart wanna work till age 51, 52, whatever, your retirement benefit only increases by virtue of how your average final compensation increased during those extra years, your benefit doesn't go up in recognition for the extra years you actually worked because you already hit your max benefit cap of 50% at 20 years of service. What the recommendation would allow is if a member continued to work past that mark for every extra year they worked, they could see their max benefit increase a little bit in recognition of that extra year of service. So that is an incentive, that is an enhancement, that is not a reduction or a requirement that anybody work longer. So just to be clear, there is nothing, except for that little provision for not even hired or appointed judges yet, there is no provision in these recommendations that would require anybody to work to a later age or to have higher numbers of years of service in order to vest. On the COLA, the second piece of your question about you mentioned working longer and getting less, really the only change to the benefit of structure proposed here for most employees has to do with the post-retirement adjustment allowance, the COLA. Currently there is a requirement that you need to be receiving a retirement benefit for at least 12 months to get your first COLA. And the only, the recommendation that would change that would extend that period from 12 months to 24 months. So you would essentially, it would just add a year before your first COLA kicks in and shares a little bit of inflationary risk that way. The other change has to do with resetting the minimums and maximums of the CPI formula. So the statute basically says that the CP, the COLA is calculated by looking at what the net percentage change in the consumer price index was from fiscal year to fiscal year. But if there is a positive value that's 0.5%, that rounds up to the 1% minimum. Or if it's 5.5%, it would round down to the current 5% maximum. What this proposal would do is change those minimums and maximums from one in five to zero and four. So this would not say that people get a 0% COLA. What this would say is that if you had, if the net percentage change in the CPI was less than one but greater than zero, it would be the actual fractional value used. You wouldn't round up to one. If it was a negative value and if we were in a deflationary environment, it would be zero. So there wouldn't be a negative COLA. So this does not give anybody the ability to say unilaterally that I guess what, you're not getting a COLA this year because we can say there's a 0% minimum. This all just pertains to the formula that's already in statute and what the minimums and maximums are because those COLA's are tied to the CPI. They're not tied to any decision that the legislature or any other body is sitting around and sort of making up a number from year to year. Madam Chair, could I just add one comment to that? Please. Well, during the, we have two things that you wanted us to look at cost the task force. One was with group G, as we call it. Yeah, I just, I just want to make sure that we debrief last night's public hearing first before we get any place else. Yeah, I am. So, okay. Yeah, the second one was an incentive to stay, a retirement incentive. That's exactly what the group C that Chris was describing does. It doesn't, it sends you to stay longer and that actually saves us money. So the win-win, you get to, you get to retire a little later, you get an incentive for that. If you choose to do that, it doesn't take away your right to go at 50-20 but it also saves us money. So that's one that we really, really think is a great addition to the recommendations. And as much as somebody gets what they, more and at the same time, it saves the office and the state money. And as we're looking at that retirement incentive, we're going to take a look at what that does in other groups. But this is a great example of what you asked us to look at, retirement incentives. Yeah, thank you. So we're there, but I will say that the comment that people were going to have to work longer was a little disheartening only because one of the things that we heard right from the very beginning from all the union representatives is do not make me work longer. Do not increase the age. And the recommendations that came in and the final package do not do that. They, we, the task force was very clear that we were not going to increase the years that had to be worked or the age. So that was clear from the very beginning. So were there other comments or questions about, cause I really wanted Chris and Beth to be able to help us understand some of the comments that were made last night. And the, and I don't think that they were, the part of the problem as I see it is that this is such a really complex issue. It is so complex. And for people to try to understand it with limited information, remember that the task force spent 20 times six, about between 120 and 150 hours on this. So, and then in addition, all of those union reps from the three unions spent additional time with their members, dicing it and slicing it and trying to figure out where to go. So a number, a lot of time has been put in by people to understand this complex system. And so sometimes the comments come from, mostly they come from a place of real concern, but not total understanding. I hope that was not harsh, but so any other committee members, did you have? Yes, Senator Plena. Excuse me, this comes under the category of just wanting to better understand something. Cause I was going to ask Chris about the COLA question, the COLA issue. And I guess one way I would ask it, cause I've heard from people about this, what would it take to further to be a zero COLA increase? Is there a way to sort of succinctly say that? So I can explain it to people. Sure. So I believe based on the current formulas, you would have to be in a deflationary environment where you're actually negative inflation, if you will, where it'd be the opposite of what's happening now. And thankfully, something that we have not experienced for a very, very long time. And I defer to the treasurer to weigh in on that as well. We did have one example that a few years, not a few years, several years back, and we changed the statute that said, if you had a negative, we would make that zero and then pick up that difference. So if it was minus five, we would essentially amortize that over a period of time. I do not know if that's currently in this legislation or proposed legislation. We'll have to take a look at that, but I don't also think it's necessary. I think that just going to the zero and giving folks a break on that, what we didn't want to do a few years back and say, by the way, you're getting less on your color this year. And we can- So basically the zero is better than a negative number. That's true. And you can have, it's a CPIU, urban, northeast urban index, and you can have a situation where you have zero inflation. Not so much in the last few years, I mean, this past year and we'll see what happens going forward, whether inflation stays in the system or not. I'm not an economist, so I can't answer that question. Thank you. And I think that, oh, I see Jeff has his hand up, Jeff. Thank you, Madam Senator. So I'm not going to go back and talk about the whole, I think the Treasurer and Chris Roop did a nice job with that. I just would like to comment on the public hearing if now is the time to do so. Sure, that's what we're trying to debrief, what we heard last night. Right, I think it was, first off, thank you for having it, just to put it out there. I think it was a good opportunity for members, at least teachers, I know, state employees, others, I guess, to have an opportunity to speak with you and share with you some of the concerns they have, but I would focus, if you will, on what I thought Senator Collamore said was, I think six out of seven were positive, whatever the number was exactly. There were some written comments, I believe, we heard and encouraged members to either participate if they were willing, enable, or at least watch last night or watch later, that's the beauty of YouTube, you can watch later. So I think that a good many people were interested and we heard a lot of interest, but maybe not as interested in speaking. People are sometimes shy, but some people wanted to have written comments, I think you received some of those too. So in that regard, we did push it out to our members and encourage them to participate. I think one of the takeaways for us was that we throughout the task forces, 19 or so meetings, we communicated with our membership, made sure that they were aware that our three task force members there were supported, that we communicated with our membership at large and kept them informed. So at the end, I think there was great trust in Molly, Kate and Andrew, and the great work that they did along with you and others to come to this arrangement. And I think that that was perhaps borne out, perhaps in maybe how few people spoke up, I think there was great trust in the hard work that the task force put into this. So I think the numbers perhaps were a little bit low, but that's okay. I think there was great support and people may have been watching on YouTube that we don't know about. So I think that's that's that. And so I think it was a good overall hearing, and I thank you for it. Thank you. Senator Clarkson, did you have a question? Yeah, no, I just wanted to tack on and ask because I think that's a good question. We always forget about the public audience and I just was curious if Gail had a number who were watching and or who have watched today. I don't know that we keep track of that normally. I guess we could. At one point I glanced at it and I think there were 27, but that doesn't sound right. So I'll go back and see if I can find that information. Oh, thanks Gail. That would be great. I think Jeff's comment that people really trusted their representatives on the task force to make good decisions and work back and forth with the constituency throughout the whole process. If people trust what happened, then they wouldn't necessarily see a need to testify. And I think that that's, so I think that that is testament to the representatives from the three unions that were there, that people felt that they trusted the decisions that were made for the most part. And certainly there are people out there who disagree and there are people out there when we know it because we heard from them at our other public hearing, don't do anything. This is a contract, this is what you promised me, you can't change a thing, but we also know that times change and things change. And if we thought about that with our healthcare contract, for example, which I know is negotiated, but if we thought of that with our healthcare plan and said that when you signed up for it, that's what you're gonna get, people wouldn't be getting the same kind of cancer treatment and MRIs and all those kinds of things that they're getting now, if we consider that it was a contract that couldn't be changed over time. So I just think that that's important to remember that we have to be able to make changes. And one of the things that was pointed out was that we haven't gotten to the, I think this was pointed out by Beth, that we haven't gotten to the point of court cases here because people have gotten together and worked together. And so we haven't had the need to take this to court to settle it. So that's testament to, I think, Chris. I just wanted to chime in on that because I think you raised a really good point, Madam Chair. Two comments that I'd offer. One is, and sort of in response to one of the comments that I heard last night, that members are asked to sort of solve a problem that they didn't cause for lack of a better word. It's helpful, I think, to try to avoid an us versus them kind of dynamic when you're dealing with pensions because it's all of us. We all have skin in the game. We're all stakeholders. And what I mean by all is employers, legislators, taxpayers, and members, the systems are governed jointly by representatives of those groups. And we all, I think, have a stake in the viability of those benefits. I'm not a lawyer and I'm not equipped to speak to the contract issue, but I would mention one thing, that the sort of case law on contractual rights varies from state to state. But in states where there is a very, very strict interpretation and you cannot make really any changes on currently employed members, I would suggest that that often leads to very undesirable outcomes because there are jurisdictions out there that in the absence of an ability to work together with active members and labor to try to make modifications. In many cases, the only tool in the toolbox is to make changes for new hires only. And that doesn't do anything to reduce the liabilities that have occurred to date. What that does do is sort of reduce the rate of growth going forward with attrition, but that can often lead to systems putting plans together for new hires that don't necessarily provide the level of retirement security for new members that making minor changes to the current plans in place could provide. So it doesn't necessarily lead to better outcomes. I would put it like that. And I'm sure the treasurer probably has some comments on that as well. I just want to comment on that. And then I'm going to go to Senator Romhansdale and then Beth, the members on the task force were very clear in saying that they did not feel that we should stick to where we are right now and put all of the pain on new hires. The task force members from all three of the unions felt very strongly that that would be unfair and it certainly wouldn't help in recruitment and retention of employees. And the other, I just wanted to point out that the other thing that was very clear from the very beginning that the task force decided was that no changes would be made to current retirees. So that anybody who's a current retiree will not be affected by these changes. So Senator Romhansdale. We can go to treasurer Pierce because mine feels like a slight departure. Oh, okay. Well, first, thank you. I think Chris is absolutely right that the stakes that you can only change with new folks, they have more problems because it's harder to make up the difference and it creates more burden for those folks as they're trying to resolve it. It also, we've had minor situations like that in some of our work, but minor. The bottom line for me is also a question of fairness. It pits young against old. It pits old employees against new employees. And I think that that's a mistake. It certainly, as you said, in terms of retention and it's just not right. And I think that we're all in this together and we should solve the problems together. That means all stakeholders and all employees. And I'm proud of this state because we haven't had a situation where we go to court. And that's a tribute to the types of collaborative work that we do. But again, for me, trying doing that only to new employees creates an age and service difference that I don't think is healthy for the systems. Senator Rahman-Selt. Thanks, I mean, I think from listening to this, my big takeaway is that the difference between letter writing and rallies and public hearings that were chock full when there was a different path forward on the table. And now is that we, you know, this is exactly what our state employees and educators were asking us to do is let them come to the table and help solve this problem on equal footing with the legislature because it impacts them so greatly. So, you know, I just want to point out that should we God forbid have to do this again, you know, just not putting a proposal for people to react to out there while they're in the middle of holding their communities and schools together in a pandemic, you know, or whatever emergency we're in is probably important to keep in mind, you know, that for a lot of people, it really was the process and they are used to, you know, pitching in when and where they need to that just was not the way to start the conversation. So I want to say that. And, you know, I'm just, I'm still getting other communications of people saying this will mean this for me and this for me. I think just so we do our due diligence, maybe it's somewhere and I just need to find it, but if there's a way to look at the scenarios of different kind of cases of individuals, what this will mean for them if they're 10 years out from retirement, you know, what this means if you're in different, if you're a teacher versus a corrections worker, I just was hoping to see some scenarios of like how this will impact a particular place. I think that people can do that individually for themselves by looking at the agreement there. So they will know what their contribution rate will be. They know, they will know what the, they won't know what the COLA will be, but they will know that when they retire at this date, it'll be 24 months before they receive a COLA, but they, I think that one of the things that the task force became very clear about was that we need to keep the individuals in mind, but it's going to affect, there are like 20,000 or 16,000 people out there that are impacted by this. It'll affect, there are probably 16,000 different impacts and scenarios. And so the task force tried to be very clear about not making this personal, but to looking at the system itself, saving it, making sure that it was fair to everybody. And some people will probably, as their contribution rate goes up, they will see an increase and they will be contributing more. And that is true. But I think that it's their responsibility for them to go to the charts and figure that out for them themselves. I don't, we could do 10 scenarios and it still wouldn't answer all the questions out there. So I'm not sure how that would be helpful to people. Does that make sense? I mean, it does. I'm wondering even if it's just for me, if like some of the labor folks could, could help me with that, because someone just wrote to me and said, now I'm gonna pay $15,000 more over the next 10 years. Well, when you break that down, that's $28 a week. So in different contexts, it doesn't sound like as harmful as it may feel when you accumulate it. I just wanna better understand a little bit of that and understand who that's impacting and if it's more progressive and if they are at the higher end of the pay scale or who would be asked to pay that much more over time. I think Jeff might have a suggestion here. I do. Thank you, Senator. Senator Rom-Hinsdale, we have a pension calculator. So we're, so members can take a look at it and plug in their salary and find out exactly what their contributions are. And so I think I could share that with you and that might help you. That would be great. Then you could say, well, some of you and so is making $55,000 and so and so is making $75,000 and you can figure out the difference and it is progressive. So that was something very important to us. We thought, and that's featured in the arrangement, the deal. So happy to share that with you and I'll do so shortly here. Yeah, share it with all of us or and have you put it on the website for people. That would, Gail could post it. It would be interesting, I think for all of us. Well, this is just, happy to, it's only for the teachers. It's not the same place, the truth is I want to. Well, the employees, they have the same thing. Something similar. Madam Chair, we can do some scenarios for you. They're limited to you that you can't do everything. I'm reluctant to ask you to do anything like that. If people can look at this calculator themselves and even if you did 10, it's only going to affect 10 people, not 16,000. So I don't think it would be helpful at all. Thank you, Madam Chair. We appreciate that. I thought I saw Senator Polina, maybe you had your hand up or Senator Klaus, somebody did. I was going to ask Jeff to forward it to me as well. And I was curious with this calculator, does this show, could I go to it and see like what I'm doing now and then what I'll be doing after this proposal is put in place? Should I have my contributions with change? No, yeah, Collin just beat me to it. It's in the chat now, Senator Polina. You could see exactly where you are and where you're going, how's that? Let me just. No, that's great. If you could do that, that's great. Yes. If somebody could grab it out of a chat and make it useful for those of us who can't access chat. Oh, go ahead, Senator Clarkson. No, and so if we could get it in some other capacity, that would be great. I will send it right now to Gail. That would be great. And we'll go from there. And I'm also going to ask Gail a favor because I've been trying to find them and I can't find them anywhere. Where are all the witnesses who wrote us? Where are their letters listed? I've looked under other documents, reports and witnesses and I can't find them. Are they grouped under public hearing testimony or I can't find them? Senator Clarkson, since this is not yet a bill, we file everything under a subject. And in this case, it's under state employees, pensions 2022. Okay. I'll be happy to send you the link to that. No, is it under other documents? I don't, I don't want to deal with it later. That was exactly the point trying to move to that place here. I want to just caution us a little bit about running the calculations and the scenarios for people that we don't get so caught up in individual cases here and what it might mean for an individual person that we lose sight of the fact that what we have done here is saved the defined benefit plan for our state employees and teachers. And if we, if we start picking at saying, well, this person is going to end up paying this much more or losing this much and start thinking about making adjustments because of that, then we are lost because what we have done here is put together a package that in fact saves our pension and our healthcare system for all the employees. And some employees will, will end up with less probably because their contribution rate increases and they'll get less COLA. But if, but I just really want to caution us to not get caught up in that, but to remember that this is done to save the defined benefit plan for our, for all of our future employees and to do it in a fair manner between the employees and the employer. I, to, to be, just, I don't want to derail that at all. I'm really grateful for the calculator. It just helps me, you know, visualize this depending on the different factors and that's, that's, I'm satisfied with that. Yeah. No, that I'm fine with that. And people can play with it as much as they want. I just want us to, to just wanted to raise that caution. No, important to keep the big picture in front of us. I think all the time. So are there any more questions about kind of last night or any clarifications? And then I don't know. Um, Becky, do we have a draft yet? I think we should have it. I think we should have it. Yeah. I think we should have it. So working on the draft, I should have it. Soon I'm. Uh, waiting. I should have it seen for you. Okay. I think I need, I think I need a little more information from, from folks on a few sections, but, um, working on it. By next week, we should have it. Yeah. Oh, great. Okay. So what we'll do is schedule next week to go. Um, I think I just stated last night at the public hearing that, uh, when the question was, when would we have a draft that. We need to be very careful that all of the details of the, the. Proposals get into the legislation in the appropriate way. So that it reflects exactly what was agreed upon. And I think that that there's a difference between the, the appropriations committee and the appropriations committee. Um, the appropriations committee. Um, the appropriations committee and the appropriations committee. And that, so, um, it, it's going to take some time to make sure, and that has to be run by the, the unions. They're representatives, the treasure. The appropriations committee. Um, So. Um, does that make sense? I find it surprising, but the pension statute is, is really clear. Um, Madam chair, if I could Becky's being very kind. Uh, we're, we still have not submitted the old pep. We met today to kind of fine tune it and we will get that over. So Becky's being very, um, Becky's being very kind to my office. Okay. Thank you. I didn't want to, I didn't want to say any, call anyone out, but you know, there's, there's a few pieces that still are waiting on and all, um, you know, I'll put, I'm putting it all together. So thanks. So with, is there anything more today that, um, we want to talk about, about, um, the. Is there anything more today that we can do around pensions? Anybody else want to weigh in on, on anything. Pension wise. And I, I'll say that I, um, have been throwing out a lot of stuff here and talking a lot. Um, I'm not in a, it's a, an interesting position for me here because I'm not talking as chair of this committee, but when I throw out a lot of those things, I'm throwing them out as co-chair of the task force and a member of the task force that heard all of this information and worked with, with the, um, union members and the other legislators. So I just wanted to make that clear that. My comments here are not. Coming from me as it, as the chair of this committee. If that makes any sense to anybody. Close enough. All right. Anybody else have anything they'd like to. Um, Mike or I see Steve, Mike, or Steve, did you want to. Weigh in on anything that from the public hearing last night? If you watched or not. Just very briefly, Senator, I like to thank your committee for taking the time to hold the hearing. do see that as a good sign. You don't generally hear from people when they support the direction you're going in. You hear from them when they're concerned. So I think I could just leave it at that. Thank you. Thank you. Steve did you want to weigh in? I think I'll just say similar to what Mike said. I think it was, you know, there's not going to be ever in a unions or a democratic organization. They're very political organizations, and there's never going to be 100% agreement on anything. And I think one of the things that's really important is our members do have faith in Eric Davis and Leona Watt, and they're very capable, well-respected members. We're never, I think one of the, what's good about this agreement is that we surveyed our members. We had like 30 meetings with our members on Zoom, but we surveyed our members. And what they said was we don't want to change anything, but the least objectionable are contribution rate increases. And we tried to do it in a fair way to protect the lowest paid state employees. And we tried to do it over a period of time where people could adjust their finances, understanding that in five years, if you're in the top bracket, there is going to be in four years in the top two brackets, there's going to be at least two contract negotiations in that time period. There's going to be one if you're in the third bracket. So if the governor and the legislature in those timeframes do the right thing, you will probably see a cola during that time. So there's some of that that will be offset, but I think we tried to find a way to be as fair. I mean, I think Eric and Leona really stressed progressivity, fairness, minimal change to benefits, and really the only change is to post-retirement benefits, not to retirement, the core retirement benefits and contribution rate increases. And the only thing I would say that I just repeat as much as I can is the increased contribution rates on state employees over the next five years and into the future amount to about $15 million a year in new revenue to the pension system. What was important to us is that the state also put $15 million a year above ADEC into the pension system, so that it's matched 50-50. And that I think is a fair thing. The normal costs of the pension system have been increasing and our rates have always been the state putting in usually around 12% and the employee putting in around 6.65. And in the last few years, the state is up to like 20, almost 25% of payroll, and we're still at 6.65 other than Group C, which is a little higher. So what we're doing is over time adjusting that to get back into balance where the employees make their contribution. And I think our members, and you can see I think in the numbers that appeared yesterday, understand their responsibility to carry their share of the contribution of the normal cost. The unfunded liability, they may not think is their responsibility as much, but the normal cost has always been a shared responsibility, just like healthcare, 80-20. We've always felt we've had to make some investment. So I think Eric Leona and the task force were able to come up with not a perfect plan, but definitely the best plan. Thank you. I appreciate your comment about the normal cost and how that shift happened there, because I think that's not well understood by a lot of people. So that was helpful. Thank you. I think Beth Pierce was the only other person on earth before this started that really understood that. And now I do. And I do too. It took me 114 hours. Well, I would say that Eric Davis and Leona certainly, they had different perspectives, but I used to refer to Eric as an actuarial wannabe, and I consider that to be a compliment. So Leona added so much value as well. They were great. They were all great. So I want to remind us before we move on to something else here, I want to remind us also that in addition to this package that has been put forth is that other substantial changes were made last year in Act 75, I think it was 75, that changed the VPEC, changed the responsibilities, the composition that changed the experience. I think it's called the experience, experience something from five years to three years. And it set up the oversight committee, which I think is going to be hopefully will assure that we will not end up in this spot again. So yeah, yeah, Allison. Thank you. I think I think that's a great response to the concerns of people that we're going to be back here in 10 years. We have something we've never had. We now have an oversight committee in place that will be whose primary charge is to oversee the health and welfare of this system. So that's a huge difference, which we have not had. Corrections has had it, child welfare has had it, a bunch of other things in the state, not that any of them are perfect, but this is I think a huge step forward having that oversight group in place. And thank you, Brian, for being willing to serve on it. Right. Aren't you serving on it? No. No. Oh, I thought Brian. I think it's Randy Brock and I mean, it's Corey, Corey, parents, Cheryl and Cheryl. And Cheryl. Right. Yeah. And I will pop. Thank you for the compliment. Yes. Brian Brock. No, it's not Brock. It's parents. It's Corey. Right. It's Corey, Cheryl and Jane. Yes. And yes, Senator Calmar. I didn't mean to interrupt, Madam Chair, if you had something else. I just want to put the final word on last night if I could. And I want to thank Jeff for bringing it up first and Mike for weighing in on it and also Steve. You know, when we set up the time for the hearing, I'm not sure how it eventuated that we came up with a two hour hearing. It just seemed like that might be a reasonable amount of time to hear from what we assumed would be a lot of people. And I didn't think about it, Jeff, until you brought it up. And then Mike said the same thing. A lot of times we just assume that it's a hot topic and that we're going to hear a lot of sort of give and take and some disapproval and some approval. But I think you're right. I think in the end, what it indicates, at least to me, is that there's general agreement with what was finally put forth by the task force. And I'm really excited to move this thing forward. I think it's going to be fine. So thank you. Thank you, Senator Calmar. Thank you, Senator. Couldn't agree more. I just wanted to make one comment about that this bill is in this committee right now. It also will have to be really scrutinized by appropriations. And they have started taking testimony on it. They did a walk through or something or other yesterday. So they are already looking at the the appropriations from the state as we look at passing the bill. So when we get to the point of passing it out, appropriations will be ready also. Just wanted to make that clear. Anything else? Good. It is exciting. I agree. It's always nice when good work. I mean, we're all very proud of you and all the all the work of this, both the task force and all the people on the screen. You guys did a terrific job. And the people of Vermont should may not all be aware of this, but they should all be grateful because as Chris points out, we are all in this. Every taxpayer in this state is involved and has a stake in this. Senator Rom Hensel, I was just wondering if the if the town hall already happened and if the, you know, sorry. What do you mean the town hall? Last week. Any, any. Yeah. Right. Okay. Could you still send us an invite? I understand people. Sure. Not coming to us, but I'd like to hear when, you know, you when I'd like to go to them. And happy. When is it, Jeff? I believe it's Tuesday. Colin will correct me if I'm wrong, but I think it's Tuesday next week. I don't have the exact time and I don't have the invitation yet, but that will soon, I think that's tentatively set for Tuesday. There were some scheduling issues going on, but we're trying to have that town hall with our folks. Oh, we should, we should watch not participate. Yeah. That's what I mean. Yeah. So we don't need an invite. We just Monday. I'm sorry. Colin did. He's corrected me Monday. I knew the good thing you've got Colin there. Yeah, I know. He keeps me on the straight and narrow. And so thank you, Colin, wherever you are. You're there somewhere. He's right there. He's right there, but it's why he's not showing his video because he's too busy working. Oh, look, a magical man. Jeff. He's there. So anyway, Monday and we'll get you the invitation so you can somebody watch her and see what's going on there. Okay. Thank you. So, Gail, who drafted the temporary, the bill for temporary employees? Did we get them here? Yes, it's Becky Wasserman. Oh, it is Becky. Okay. I was just trying to think who did I work with on it? And I think Becky. So what I'm going to suggest is that we take a five minute break.