Should some favored local retirement systems be immune to local control? Some lawmakers don’t think so and a bill was filed yesterday to remedy this situation.
The bill, House Bill 2608, seeks to restore local control of local retirement systems under state governance (see pg. 89). Right now, there are more than one-dozen municipal retirement systems that have, over the years, been successful in getting some or all of their pension plans put in state statute. Intended or not, the effect of this approach has been to erect another layer of government bureaucracy between pension plans and their community stakeholders.
The bill, if enacted, would eliminate this special form of pension protectionism and grant a municipality that is a “sponsoring authority” the ability to:
“…adopt by ordinance or resolution, as applicable, provision that supplement or supersede the operative provisions of the public retirement system’s statute, including any provision relating to the benefits, participation and eligibility requirements, funding source or amount, and administration of the system.”
There’s really no good public policy reason that local retirement systems should have such separation from their stakeholders. It’s a welcome sign that some lawmakers agree and are moving ahead with legislation to restore local control of state-governed pension plans.