Supreme Court PERS ruling: Sen. Tim Knopp calls for immediate action

Sen. Tim Knopp_thb

Sen. Tim Knopp

Salem, OR – Yesterday, the Oregon Supreme Court announced their decision to overturn major PERS reforms from the 2013 Grand Bargain that would have saved the state close to $5 billion in unfunded liability.

“[Thursday] we lost 95% of critical savings from PERS reform,” said Senator Tim Knopp (R-Bend). “That means larger class sizes; fewer school days; teacher layoffs; eliminating programs like art, music and PE in schools; tuition increases at community colleges and Oregon universities; fewer police officers, firefighters, and prison guards; fewer resources for fixed-income seniors; cuts to community mental health services; park closures; a reduction in sustainability and community development programs; and significant reduction in other critical services. The legislature must take immediate action to streamline bloated government, create jobs and seek legal PERS reform without raising taxes before Oregon falls off this looming fiscal cliff.”

Beginning in 2017, local governments and school districts will face PERS rate increases of around 5.5% of payroll, crippling budgets and forcing cuts to critical services. Meanwhile, the legislature will face the challenge of filling a nearly $5 billion hole in the state budget from unfunded PERS liabilities.

“We have to end the cycle of placing the bandaid of higher taxes over bloated state government and ballooning liabilities,” said Senator Knopp. “The legislature cannot burden our schools, local governments and working families any longer. Because of years of one-party of rule in Oregon, it’s time to find a legal route to PERS reform and create jobs to strengthen the economy and provide a stable revenue stream for the next generation of Oregonians.”

Senator Knopp introduced Senate Bill 782 and Senate Bill 785, proposing the following constitutionally viable pathways to reducing unfunded PERS liabilities:

  • Re-direct the 6% IAP Member Contributions
  • Set amortization rates for Money Match at a level that reflects competitive private sector rates
  • Place new employees in defined contribution plans similar to those in the private sector

“The only long-term solution to eliminating crippling PERS liability is to establish a market-based fair retirement plan for new public employees that mirrors retirement plans found in the private sector,” explained Senator Knopp.

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Posted by at 05:47 | Posted in OR 78th Legislative Session, Oregon Senate, Oregon Supreme Court, PERS, Public Employees Retirement System | 5 Comments |Email This Post Email This Post |Print This Post Print This Post
  • Jonathan

    More blah blah blah from one of Oregon politics’ biggest buffoons. These jerks supported the perfectly predictable “Grand Bargain” fiasco. (I predicted it early and often). His proposals here are even further into the fantasyland of illegality.

    • Selah

      Dire Yoko Ono Jogathon,
      Thou pe’ers aback inn the left blank-heinous haus, halloo, as wet spots upon your mattress ‘wail’ apparent.

      Wake up monsieur twitter-hundoggy, twit, get a hold of your tail and travail on sum other quail and get your musicale be reprinted “Inna Godiva sum schlep musique.”

  • Bob Clark

    I believe the federal employee retirement system would be an appropriate substitute for new state employees and possibly those under the IAP only format (new state employees after 2003). The FERS system is an employee driven investment model rather than the top down Investment Council/State Treasurer investment model. The latter model charges employees/employers relatively high management fees, and it invests in hedge funds and real estate besides stocks and bonds, which have led to PERS under performance relative to passive stock market and bond market index funds in recent years.

    There may not be much that can be done for state employees hired before 2003 in terms of limiting the state’s retirement obligations given the state court’s renderings. So, one solution is spread the excessive cost of these obligations among new state employees (turning it over to a 401k like system instead of PERS), reduced subsidies for non-education projects, and public school reform allowing more charter schools (which save about 20% over traditional public schools).

  • Craig

    I want my PERS. I took this crummy job teaching a bunch of moronic kids with stupid parents just so I could retire in Arizona in style. I need at least 75 K per annum to do that. With PERS I will get that much. At least now I will. So stop with all this reform nonsense. And remember, I earned it.

    • Granola girl

      Lol, too funny

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