IRTA Call to Action # 3

Educators: Please Email Your State Senator Immediately,

Senators need to hear from you by Monday morning.

Ask Them to Oppose HB 1004 and Support HB 1161!

If you have already emailed your Senator, please feel free to do it again from some of the additional Bullet Points we have added for each Bill.

You can identify your State Senator at this link: http://iga.in.gov/legislative/find-legislators/. The link will tell you their district number. Their email address will be s(district number)@iga.in.gov. For example, Sen. Frank Mrvan represents district 1. His email address is s1@iga.in.gov.

Please compose an original email using the information provided below. Do not cut and paste any of this email: “form emails” are ineffective and in fact can completely backfire! I have heard legislators say they would take one original note, letter, or email from a constituent over hundreds of form letters.

Your “grass root efforts” are the most effective. They want to hear and know what their constituents are thinking. Especially those legislators that are in contested primaries and elections.

Background Information – HB 1004

HB 1004 passed the Senate Pensions and Labor by a vote of 7 – 4 vote. One republican joined the 3 democrats in opposing the bill. This bill will be heard by the Full Senate on Monday Afternoon for its 2nd Reading. The bill addresses 3 separate issues: supplemental pay, licensure reciprocity and creates a “Defined Contribution Only” pension option for newly hired teachers. It is this section of the bill that is of great concern to IRTA. This bill’s stated intent is to address the current teacher shortage. We do not believe that a DC only option does anything to entice or retain new teachers, but it does take an incremental step toward making a DC plan the only pension option at some time in the future.

Talking points for HB 1004

• Indiana Educators have both a DB (defined benefit) and DC component to their retirement plan, the pension and ASA account. The current system is the best of both worlds and a DC only option is not needed.

• Even though “DC Only” is an option in HB 1004, it is an incremental step toward doing away with our current pension plan and replacing it with a DC only plan in the future.

• Allowing a “DC Only” option is a significant change in public policy and should be extensively studied and vetted in the Pension Management Oversight Committee

• The average balance in the ASA account for a retiring teacher is $95,000. That’s putting in 3% of your salary each year for your whole career. A 4% payout after retirement would be less than $4,000/year and just over $300/month. Even if the savings doubled or tripled it would be far below today’s Defined Benefit.

• With a “DC Only Option” plan, the stock market may determine retirement despite age or health.

• An educator choosing the Defined Contribution Only option will need to save $650,000 to generate a monthly income equal to an average teacher pension. The volatility of the stock market coupled with flat teacher salary increases will make it very difficult to save this amount. What happens when an individual cannot save enough to retire? Either they continue to work well past their prime or may end up on welfare and/or other types of public assistance. Neither is desirable.

• Proponents suggest that the DC only plan is good because it is an option and millennials want options. What happens 40 years down the road when retired teachers are having to sign up for welfare and food stamps? Another drain on public services.

• Consider the fundamental causes of the teacher shortage. Does anyone believe individuals are not choosing teaching because they want an uncertain, speculative choice about retirement security?

• A State Representative, who was a co-author of the bill, voted against the bill in the House

• What happens to a teacher who starts in a DC only plan, then transfers to a school district that does not offer the plan?

• It may cost up to One Million dollars to upgrade the INPRS system to include this new DC only option for future educators.

Background Information – HB 1161

HB 1161 is the “13th Check” bill. It passed the Senate Labor and Pension Committee by a vote of 9 – 2 and is awaiting action in the Senate Appropriations Committee, chaired by Sen. Luke Kenley. The bill is coming the Appropriations Committee fully funded and not causing an increase to the unfunded liability.

Talking Points for HB 1161

• No Social Security increase this year

• 8 years since last COLA in 2008

• Grocery prices have increased over 32% since 2008

• Electric Bills have increased over 15% since 2008

• Health care cost continue to escalate

• Over 14,000 retired teachers receive less than $1,000/month in their pensions

• Over 6,000 retired teachers receive less than $650/month in their pensions

• Indiana has had a surplus from their yearly budget the past few years that would more than fund a “13th Check” each year

• “13th Check” amount has never increased since its inception

• HB 1161 is funded by proceeds from the recent “tax amnesty” program and will not increase the unfunded liability of the Pre’96 pension fund.

Our goal is to ensure every State Senator receives multiple emails from constituents regarding HB 1004 and HB 1161. We have heard from a few senators that they are being contacted by you. Thank you!!

Senate Appropriations Committee for HB 1161 “13th Check”

Senate Leadership lists, Co-sponsors, Contested Races, Leaving Senate

(R) Senator David Long – President Pro tempore Dist. 16
Senator.Long@iga.in.gov
7100 W. Jefferson Blvd.,
Ft. Wayne, IN 46804 (Leadership and Contested Primary)

(R) Senator Patricia Miller – Assistant President Pro Tempore Dist. 32
Senator.Miller@iga.in.gov
1041 Muessing Rd.,
Indianapolis, IN 46239 (Leadership and Retiring)

(R) Senator Jim Merritt – Majority Caucus Chair – Dist. 31
Senator.Merritt@iga.in.gov
10327 Tarpon Dr.,
Indianapolis, IN 46256 (Leadership)

(R) Senator Jim Tomes – Assistant Majority Caucus Chair - Dist. 49
Senator.Tomes@iga.in.gov
9412 Highway 66,
Wadesville, IN 47638 (Leadership)

(R) Senator Brandt Hershman – Majority Floor Leader Dist. 7
Senator.Hershman@iga.in.gov
PO Box 177,
Buck Creek, IN 47924 (Leadership)

(R) Senator Randy Head –Assistant Majority Floor Leader, Communications Dist. 18
Senator.Head@iga.in.gov
200 W. Washington St.,
Indianapolis, IN 46204 (Leadership, leaving Senate)

Senator Luke Kenley – Chair of Appropriations – Dist. 20
s20@iga.in.gov
102 Harbour Trees Ln.
Noblesville, IN 46061 (Co-sponsor, contested primary, Leadership)

Senator Eric Bassler – Co-Sponsor – Dist. 39
s39@iga.in.gov or eric@ericbassler.com
200 W. Washington St.,
Indianapolis, IN 46204 (Co-sponsor)

Senator Jim Banks – Co-Sponsor – Dist. 17
s17@iga.in.gov
200 W. Washington St.
Indianapolis, IN 46204 (Leaving Senate)

HB 1004 will be heard next week in the full Senate on Monday afternoon and HB 1161 will be heard in the Appropriations Committee sometime next week. Time is short and it is absolutely critical that members of the Indiana Senate hear from their retired teachers constituents.

If your county hosts 3rd houses, cracker barrels, or legislative breakfasts, please attend these meetings this weekend and bring these bills up for discussion by your senators. They are aware of HB 1004 and HB 1161. Senators are receiving Fact Cards each week on the DC/DB issue and the “13th check” along with Steve and me meeting with Senators personally.

If you are attending our Legislative Brunch on Tuesday, be sure to contact your Senator and let them know you will be at the Brunch. You may also set an appointment to speak to them. If your Senator is not available, feel free to meet or set appointments to meet with the co-sponsors of the bill, leadership and members of the committees. The timing this year of our Legislative Brunch is coming at a great time as our bills are just ready to be heard and voted on either in committee or the Full Senate.

Now is the time for the grassroots to take effect and they need to hear loud and clear from their constituents. They need to know we are here, we listen, we care and we vote. We are tired of being forgotten and pushed aside.

During second reading will be our last chance to remove the Defined Contribution Only option out of HB 1004 in the Full Senate. The 3rd reading they would need to defeat the whole bill.

Thank you so much for your efforts and support. You will be the ones that make the difference!

Tom Mellish
Executive Director

Steve Beebe
IRTA Lobbyist