Page 2 of 2   <      

Governor examines pension system

The proposals are likely to be the subject of intense negotiations during next year's 46-day legislative session with Democrats, who hold a narrow majority in the state Senate, and employee groups.

R. Ronald Jordan, executive director of the _blankVirginia Governmental Employees Association, which represents about 20,000 state employees, said in a statement that the group has "deep concerns" about the new employee contributions.

However, it called the idea a "good-faith effort" to ensure the system's financial stability and a good place to start legislative talks.

The change would affect all current employees. The General Assembly already agreed this year to ask new employees hired after July 1, 2010, to pay their 5 percent contribution.


McDonnell said the changes would not affect repayment of $620 million borrowed from the retirement system this year to close a budget shortfall and fund government services. The General Assembly agreed to repay that loan over 10 years, starting in 2013.

McDonnell was criticized after his decision to dip into the retirement fund to close a budget gap, which also required billions in spending cuts. He told reporters Thursday that borrowing from the _blankVirginia Retirement System - a maneuver he and the General Assembly jointly undertook just a few months ago - "frankly, wasn't a good idea."

He said that the money would be repaid and that the state had not siphoned enough to affect the already-underfunded system in the long haul.

But Democratic Party of Virginia Chairman Brian J. Moran said that McDonnell balanced the budget this year only through the loan and was now "asking state employees to pay for his sleight of hand."

Del. David Englin (D-Alexandria) called on McDonnell to support a constitutional amendment that would prohibit raiding the employee retirement system to pay state operating expenses in the future.

"We need to have this important conversation," he said. "But we need to look at the whole context."

<       2

© 2010 The Washington Post Company