2021 Legislative Session Review
The 2021 regular legislative session adjourned “sine die” - a Latin phrase meaning without a future meeting day - on Monday, May 17, 2021, and the threat from a proposed retirement review commission disappeared with it.
Senate Joint Resolution: SJR55 sponsored by Senator Arthur Orr (R-Decatur) & Senator Greg Albritton (R-Atmore) – DEFEATED passed the State Senate but died in the House, would have created the State Employee and Teacher Compensation Joint Interim Study Commission, which was tasked with reviewing, studying, and recommending changes to the “salary, retirement, health insurance, bonuses, and other benefits” provided to state agency and public education employees.
The resolution was pushed and promoted by the same legislative faction that partnered with the Pew Charitable Trust in 2016 in an attempt to transfer Alabama’s retirement system from a defined benefit plan to a privatized, 401(k)-style model.
ARSEA rallied our legislative allies in the House to have the resolution carried over on the session’s second-to-last day and blocked from consideration on the last meeting day.
We offer our thanks and appreciation to State Rep. Rex Reynolds (R - Huntsville) and State Rep. Proncey Robertson (R - Mount Hope), both of whom are dues-paying members of ARSEA; State Rep. Randall Shedd (R - Fairview), who made the motion to carry over the resolution once it reached the House floor; and House Ways and Means General Fund Chairman Steve Clouse (R - Ozark), who lent his support to our effort.
ERS Board Expansion: SB79 sponsored by Senator Garlan Gudger (R-Cullman) and carried in the House by Rep. Reed Ingram (R - Montgomery) was signed into law. This Act Expands the ERS board from 13 to 15 members and adds designated seats for cities, counties, and local public boards. Adding two elected seats tilts control of the board away from politicians and appointed members and toward the duly elected representatives of employees and retirees who are members of ERS. ACT 2021-390
This ARSEA-supported legislation resulted in the Alabama Legislature awarding final approval to giving employees and retirees more representation on the board overseeing the RSA Employees’ Retirement System (ERS).
General Fund Budget: HB309 sponsored by Representative Steve Clouse (R-Ozark) fully funds the Annual Required Contribution (ARC) of the Retirement Systems of Alabama and the requested allocation of the State Employees’ Insurance Board and including a 2% cost-of-living pay raise for state employees.
Because lawmakers have consistently funded the fiscal needs of the RSA, Alabama has avoided the problems faced by other states. This will be the fifth consecutive year that SEIB will be funded at the same level. The budget also includes language expressing the legislative intent of not increasing the health insurance premiums for state employees and retirees.
Retiree Longevity Bonus: SB229 sponsored by Senator Del Marsh (R-Anniston) failed to pass. It would have provided retirees with a longevity bonus based on years of service ($24 times years of creditable service). State retirees would have received the bonus in December and local government retirees would be eligible when, and if, funding is approved by their former local government employers.
Unfortunately, ARSEA failed to secure the longevity bonus for retirees because House and Senate budget committee chairs signaled their opposition when it was in place to receive a vote on the Senate floor. Our running vote count among senators showed that ARSEA had the votes necessary to easily pass the bonus legislation if considered on the floor, but the General Fund and Education Trust Fund budget chairs launched a filibuster to stop the bill’s progress. A similar Alabama Education Retirees Association measure to provide retired teachers and support staff with the same bonus failed to gain traction, as well.
According to Sen. Del Marsh (R - Anniston), who sponsored our bill, the budget chairs have committed to passing a retiree bonus next year. We will, once again, pre-file the bill at the earliest opportunity and ensure it is in place for the promised passage when lawmakers convene for the 2022 regular session in January.
State Employee Retirees’ Trust Fund: SB394 sponsored by Senator Greg Albritton (R-Atmore) died. It would have created a State Employee Retirees’ Trust Fund to be managed by the ERS Board of Control to fund periodic bonus checks for state retirees.
Homestead Exemption: HB344 sponsored by Representative David Faulkner (R-Mountain Brook) passed. This legislation provides certain homestead exemptions to be claimed and verified by mail or electronically as provided by the local tax assessing official.
Alabama Gaming Proposal: SB319 sponsored by Senator Jim McClendon(R-Springville) died. This proposed constitutional amendment establishes the Alabama Education Lottery and the Alabama Gaming Commission. 50% of the proceeds from the lottery would have gone towards the Education Trust Fund and 50% would have gone to the General Fund. The establishment of the Alabama Gaming Commission will allow casino-style games at five locations.
ARSEA expects that a Special Session will be called to readdress gaming in Alabama.
Revised Compensation for Retired Judges: HB109 sponsored by Representative Jim Hill (R-Moody) died. ARSEA followed this legislation that would have revised the compensation received for retired justices and judges who are called for active service.
Group Insurance Products: HB261 sponsored by Representative Kerry Rich (R-Albertville) and SB295 sponsored by (R-Trussville) died. This legislation would have provided a level of oversight through the State Employee’s Insurance Board (SEIB) and the Local Government Health Insurance Board (LGHIB) approving companies to offer employees and retirees group insurance products.
Pharmacy Benefit Managers: SB227 sponsored by Senator Tom Butler (R-Madison) was signed into law. This law restricts the ability of pharmacy benefit managers (PBMs) to negotiate lower prescription drug costs for Alabamians on group health insurance plans, including self-insured plans like SEIB and PEEHIP and other employer-based plans. ACT 2021-341
Public Safety Death Benefit: HB81 sponsored by Representative Phillip Pettus (R-Killen) was signed into law. This law allows the use of hazardous duty time to calculate years of service for in-service death benefits for firefighters, law enforcement officers, and correctional officers. ACT 2021-270
Fire Fighter Death Benefit: HB532 sponsored by Representative Russel Bedsole (R-Alabaster) passed. This legislation provides an additional benefit for any municipal firefighter that dies as a result of a cancer diagnosis during the ten-year period after the firefighter's last date of employment.