Welcome to the latest edition of This Week in Pensions. This week, CNN projects that pension restoration supporter Jonathan Kreiss-Tomkins will win Alaska’s gubernatorial race. In Washington, the U.S. House voted to expand investment options in retirement savings plans used by public school employees.
CNN Projects Alaska Pension Restoration Supporter Will Win Governor’s Race
CNN projected Thursday that Jonathan Kreiss-Tomkins will win Alaska’s governor’s race. He earned just over 50% of first-choice votes in Thursday’s tally, and Alaska’s final ballot count is scheduled for November 18.
Kreiss-Tomkins campaigned on restoring defined benefit pensions for public employees. Earlier this year, lawmakers passed House Bill 78 to restore pensions, but Gov. Mike Dunleavy ultimately vetoed it. Alaska’s public workers, their unions, and advocates have spent years arguing that a secure retirement can help schools and public agencies recruit and retain the people their communities depend on.
The next legislative session will also put two pension bill sponsors in key leadership roles. Sen. Cathy Giessel, who sponsored last year’s Senate pension bill, is set to become Senate president. Rep. Chuck Kopp, who sponsored House Bill 78, will continue as House majority leader. That gives public workers and their unions a chance to build on the bipartisan support that got the bill through both chambers this year.
Wisconsin Governor-Elect Reaffirms Support for Repealing Act 10
Wisconsin Gov.-elect David Crowley reaffirmed his support for repealing Act 10 in an interview earlier this week. The 2011 law sharply restricted collective bargaining for most public employees and required many to pay a larger share of their pension contributions. Repeal could reopen negotiations over how public employers and workers share those costs.
Crowley left the details to lawmakers and said his administration would examine the potential effects on taxes. The Wisconsin Institute for Law & Liberty estimates that repeal could cost school districts and local governments more than $2 billion annually. That estimate includes potential changes to pay, health benefits, and pension contributions. Actual costs would depend on what lawmakers enact and what employers and unions negotiate, and school revenue limits would also shape what districts can spend.
U.S. House Votes to Expand 403(b) Investment Options
The U.S. House passed the Retirement Fairness for Charities and Educational Institutions Act on Wednesday by a vote of 295–128. The bill would allow 403(b) plans, which are available to public school employees and workers at many nonprofits, to offer collective investment trusts and insurance company separate accounts. Both are investment options already available to 401(k) plans. House Financial Services Committee
For public school employees who participate in both a pension and a 403(b), the bill would affect which investments their savings plan can offer. Their defined benefit pension would continue to provide a monthly benefit based on their plan’s formula.
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