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Pension Bill Poorly Planned, Damaging to Educators

“When Virginians send their representatives to Richmond,” VEA President Dr. Kitty Boitnott told a State Capitol news briefing this morning, “they expect that they will do the right thing, and they expect that they will do due diligence on legislation they’re voting on, especially when that legislation affects hundreds of thousands of people. In this case, they did not do that.”

“This case” was the 11th-hour passing of sweeping reforms to the Virginia Retirement System by the 2012 General Assembly—reforms which will be damaging to many of the Commonwealth’s public employees, including teachers. Pension reform was passed just before the year’s session was adjourned Saturday evening, March 10.

“We received the conference report on the legislation seven minutes before debate began,” Delegate Jennifer McClellan said at the press conference. “It was 69 pages long. How many people do you think read it? How many understood it? This is not the way to legislate.”

VRS has always been based on a defined benefit plan, which guarantees public employees a modest retirement benefit no matter what happens to the stock market. The new legislation provides a hybrid plan for new employees, combining defined benefits with a defined contribution plan, exposing new public employees to the risks of market fluctuations and forcing them to contribute a larger percentage of their pay toward retirement.

“Virginia has long had a compact with its teachers,” said Boitnott. “Dedicate your career to our students and you won’t become wealthy—but you will have a decent retirement. This compact is being broken.”

VRS’s finances are tight because of chronic underfunding by the General Assembly, which has only twice in the past 20 years paid into the system what the VRS Board recommended.

“This problem is not brought to you by our public employees,” said Michael Mohler, president of the Virginia Professional Firefighters. “It’s brought to you by Wall Street and the Virginia General Assembly. The solution is to fund the system.”

At the press conference, Boitnott, McClellan, Mohler and representatives of the Commonwealth Institute for Fiscal Analysis and the Virginia Retired Teachers Association called on Governor Bob McDonnell to veto the bill making the VRS changes.

“Make no mistake—this puts the Commonwealth in a very precarious position as we try to fill the shoes of an aging teaching force,” Boitnott said, noting that one-fifth of the state’s teachers are at least 55 years old. “Virginia is competing regionally and nationally for the best young minds to replace them in our classrooms. And we’re becoming less competitive when it comes to salary and retirement benefits.” 


 Photos. View or download photos from the news conference.


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