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Governor hopes to call legislative session next month to look at more PERS reform

The Oregon School Boards Association last week joined an effort to defend an Oregon Public Employees Retirement System reform bill in court.

A group of PERS benefit recipients filed a lawsuit on July 1 petitioning for a review of the PERS-reforming Senate Bill 822, which the Legislature approved in its last session. OSBA on Friday filed a motion to intervene, effectively adding its name to the list of the petition respondents defending the bill as a valid law.

PERS is the retirement fund for state and local agencies, such as schools and government workers, and is how the state pays for retirement benefits and pensions to its retired workers.

Senate Bill 822 alters the PERS cost-of-living adjustment, and it is estimated that the legislation will save about $400 million for all government agencies this biennium and $200 million for school districts alone. State funding constitutes about 70 percent of the Lake Oswego School District’s resources.

OSBA sponsored a bill for the 2013 legislative session, Senate Bill 754. The bill could have saved more than $1.75 billion for the 2013-15 biennium and billions more long term, according to a PERS-funded estimate.

“SB 822 does not provide the PERS savings we had hoped for,” said OSBA Executive Director Betsy Miller-Jones in a written statement. “But because its provisions affect all of our members, and because its legal standing could affect future PERS legislation, we believe it is important that we take part in its court defense. We’ve got to reform PERS so we can place more money in classrooms where it belongs.”

OSBA is a member services agency supporting almost 1,400 school board members in school districts, education service districts and community colleges, and the agency also serves charter school boards.

SB 822 “eliminated a tax break for out-of-state PERS recipients,” OSBA spokesman Alex Pulaski said.

It also capped the cost-of-living adjustment at 1.5 percent for all PERS benefit recipients, effective Aug. 1, according to the state PERS website. The COLA previously was capped at 2 percent.

“Petitioners will be directly and adversely affected by SB 822 if it is not declared unconstitutional or a breach (of contract) or invalid for some other reason. ... Petitioners have protected private property rights in receiving promised retirement benefits, including the annual COLA,” the petition states.

Respondents include the state, city of Portland, Oregon City School District, Beaverton School District, Tualatin Valley Fire & Rescue and West Linn School District. Lake Oswego School District was not listed as a respondent, although the court’s decision on the case will affect all organizations with retired or current employees on PERS.

“The court’s decision will have repercussions for public agencies across Oregon,” Pulaski said.

The governor hopes to call a special legislative session next month with the intent of passing more PERS reforms.

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