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129th MAINE LEGISLATURE |
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LD 1537 |
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LR 1295(01) |
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An Act To
Increase the Portion of Retirement Benefits to Which the Cost-of-living
Adjustment Applies |
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Preliminary
Fiscal Impact Statement for Original Bill |
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Sponsor: Rep. Martin of Eagle Lake |
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Committee: Labor and Housing |
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Fiscal Note Required: Yes |
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| Preliminary
Fiscal Impact Statement |
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FY 2019-20 |
FY 2020-21 |
Projections FY 2021-22 |
Projections FY 2022-23 |
| Net Cost
(Savings) |
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General Fund |
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$249,282,236 |
$0 |
$1,457,899 |
$1,457,899 |
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Highway Fund |
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$23,388,879 |
$0 |
$348,829 |
$348,829 |
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| Appropriations/Allocations |
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General Fund |
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$249,282,236 |
$0 |
$1,457,899 |
$1,457,899 |
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Highway Fund |
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$23,388,879 |
$0 |
$348,829 |
$348,829 |
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Federal Expenditures Fund |
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$20,498,456 |
$0 |
$313,167 |
$313,167 |
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Other Special Revenue Funds |
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$32,998,895 |
$0 |
$520,451 |
$520,451 |
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Federal Block Grant Fund |
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$1,006,940 |
$0 |
$24,333 |
$24,333 |
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| Fiscal Detail
and Notes |
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Increasing the
portion of retirement benefits on which the cost-of-living adjustment is
applied to will increase the unfunded actuarial liability (UAL) of the Maine
Public Employees Retirement System (MainePERS) by approximately $350 million. Pursuant to the Constitution of Maine,
Article IX, Section 18-A, unfunded liabilities may not be created except
those that result from experience losses.
The Retirement Allowance Fund program within MainePERS will require
one-time General Fund appropriations of $249.3 million in fiscal year 2019-20
for its estimated share of the increase in the UAL. The required allocation for the Highway
Fund's share of the cost is estimated to be $23.4 million. Federal Expenditures Fund, Other Special
Revenue Funds and Federal Block Grant Fund allocations will total $54.5
million. Various other funds totaling
$22.8 million but not shown above will require allocation by financial order. |
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This provision
will also increase the normal cost component of the employer retirement rate
by approximately $3.0 million annually beginning in fiscal year 2021-22. The annual impact to the General Fund and
Highway Fund is estimated to be $1.46 million and $349,000,
respectively. The increase in costs to
the Federal Expenditures Fund, Other Special Revenue Funds and the Federal
Block Grant Fund total $858,000.
Various other funds totaling $335,000 but not shown above will require
allocation by financial order. |
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