A coalition opposed to a state pension overhaul is urging Gov. Robert F. McDonnell (R) to veto the plan, which was drafted and approved in the final hours of the Virginia General Assembly session.
Legislators said at the time of the March 10 vote that only future employees would receive skimpier benefits.
Details of a pair of complex pension bills were worked out in a House and Senate conference committee during the frenzied last hours before sine die, leaving lawmakers little time to digest the plan before voting, Del. Jennifer L. McClellan (D-Richmond) said at the news conference.
“We got the conference report seven minutes before debate began,” she said. “It was 69 pages long, for one conference report. How many people do you think read that?”
In the final hours of the session March 10, lawmakers passed a plan that would reduce retirement benefits for some employees. At the time, at least some legislators understood that to mean that only employees hired after Jan. 1, 2013 would be affected.
But Robley Jones, director of Government Relations for the Virginia Education Association, said Thursday that only employees with more than 20 years of service by that date will be unaffected.
Those with fewer than 20 years of service by that date will see annual cost-of-living increases capped at 3 percent, compared to 5 percent for longer-term employees. Those employed for fewer than five years by that date will have their retirement pay based on their last five years of employment instead of their last three. They also will have their cost-of-living increases capped at 3 percent.
Advocates of the pension changes say they are necessary to shore up the system, which represents a $24 billion unfunded liability.
Critics of the plan agree that the problem needs to be addressed, but at its root cause: the state’s chronic underfunding of the system.
“In the 20 years I have been president of the Virginia Professional Fire Fighters, the General Assembly has paid the required contribution to the Virginia Retirement System twice,” VPFF President Michael Mohler said. “And now the General Assembly is quite literally trying to pass the buck onto hard-working public employees.”
Said Michael Cassidy, president of The Commonwealth Institute for Fiscal Analysis: “The underfunding of the Virginia Retirement System is the primary driver of the growth of the unfunded liability.”
McDonnell spokesman Tucker Martin said the governor is reviewing the legislation.