State Rep. Chuck Moseley, D-Portage, led Indiana
House members this past week in passing legislation that helps protect
pension benefits for numerous public employees and teachers from the risks
of private sector control.
By an 83-16 margin
that included strong support from Republicans and Democrats alike,
representatives passed House Bill 1075, legislation co-authored by Moseley
that tells the Indiana Public Retirement System’s (IPRS) board of trustees
that it cannot use third party vendors to oversee annuities available to
employees who work for state and local units of government and schools.
“This margin should
make it clear that the House feels that the state needs to be in control of
the retirement benefits, rather than having those matters pushed off to a
private party that is more interested in collecting profits for itself than
protecting the futures of thousands of people across Indiana,” Moseley said.
“I hope it also
serves as a warning to the people who serve on the IPRS board that they must
be accountable and responsible for their actions,” he added.
State retirees are
on a system that contains two parts: a defined benefit plan that is funded
by the government and schools for its workers and a savings account that can
be funded by employees or employers.
When a worker
retires, he or she can cash out the savings account in a lump sum, roll it
into a different retirement account, or convert it into an annuity that pays
out benefits over a number of years.
At present, the
annuity carries a 7.5-percent interest rate, which IPRS board members felt
was too high. Their solution was to transfer administration of the annuities
over to a third party, which would set an interest rate for the accounts.
“The involvement of
a private entity in the affairs of public employees was upsetting to many of
us, and those feelings were aggravated by the attitude of IPRS board
members, who appeared to believe that they could do what they wanted and
they didn’t really care what anyone else felt,” Moseley said.
maintained that attitude, even after being told by Moseley and other members
of the Pension Management Oversight Commission (PMOC) that they preferred
state control over all aspects of the retirement system.
“They continued to
be belligerent, which led the legislators on PMOC to proceed with House Bill
1075, which was authored by State Representative Woody Burtonk
(R-Whiteland),” Moseley said. “It is my hope that this spirit of
bipartisanship on behalf of so many dedicated state workers will continue as
this matter proceeds through the Indiana Senate in the weeks to come.”