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SALT LAKE CITY (AP) -- Two bills to revamp the state's retirement system cleared the Utah House on Friday.
More than a dozen approved amendments send the measures, Senate Bills 43 and 63, back to the Senate for final approval before they can go to Gov. Gary Herbert's desk.
The economic meltdown in 2008 left many pension funds shortchanged, stripping Utah of $6.5 billion. Market returns in 2009 did little to patch up that hole, and supporters of the bill have said it needs fixing immediately.
In the debate, critics thought the situation deserved more study.
"I am one of those who thinks we are moving too fast. We're addressing half the picture," said Rep. David Litvack, D-Salt Lake City.
Todd Sutton of the Utah Public Employees Association said the group was pleased with some of the changes but thought the process overall was too hasty.
"We should study this for a year before we implement anything," Sutton told The Associated Press. "We don't know what our decisions today are going to mean five years, 10 years, 20 years down the line."
But Rep. Brad Dee, R-Ogden, who sponsored the legislation in the House, shot back that unless Utah acts now, the state could find itself broke down the line.
Waiting would be like "unplugging the smoke detector after smelling the smoke," Dee said.
The largest reform for Utahns comes in Senate Bill 63, which would replace the defined-benefit pension plan for public employees hired after July 1, 2011, with a scaled-down option.
Senate Bill 43 would bar some Utahns who retire and are rehired after July 1, 2010, from collecting a pension and a paycheck at the same time, a practice known as "double-dipping."
Republican Sen. Dan Liljenquist, of Bountiful, is sponsoring the bills. Even with all the amendments, the original goal of Liljenquist's reforms -- to meet 100 percent of the state's obligations to its current employees -- has survived committees, public outcry and debates.
The amendments amount to a few stitches rather than major surgery.
Under the original Senate Bill 63, future employees would have a choice between a hybrid retirement plan with reduced benefits or a 401(k) plan that allows workers to contribute 8 percent of their salaries. The new version raises that amount to 10 percent.
Also under the hybrid plan, public safety employees like firefighters and police officers could retire after 25 years instead of the 35 years originally proposed.
Senate Bill 43 also was touched-up a little, though it still prevents double-dipping. It now says that someone who returns to work after a year of retirement has two choices: The employee can receive a retirement "allowance" and forfeit any defined contribution related to the new job, or forgo the allowance and earn service credit for the period of reemployment.
"What we will not do is contribute one penny into additional retirements," Dee said.
Retirement has stood alongside states' rights as one of the main themes of this legislative session, probably because both issues are on the minds of policymakers nationwide.
Other states are enacting similar retirement reforms. A recent report by the Pew Center on the States said that in 2000, roughly half of the states had fully funded pension systems. In 2008, only four still did.
(Copyright 2010 by The Associated Press. All Rights Reserved.)
