The cost of the increased contribution rates

So the underlying bill the House is debating now asks state workers and public teachers to pay 3.25 percent more in contributions to their retirement plans to help balance the state budget for the year that starts July 1. In total, that increased contribution rate wold save the state nearly $90 million.

Here is how the increased contribution rates are  broken down: state workers and public teachers would pay 1.5 percent more for two years starting July 1; and 1.75 percent more for one year, starting July 1.

Here’s what each would save the state:

1.5 percent = $42 million

1.75 percent = $49 million

Rep. James White, R-Albuquerque, wants to make permanent what the state originally did two years ago when it raised what state employees and public teachers pay into their retirement plans by 1.5 percent. The state took that action plans two years ago to help balance that year’s budget. That 1.5 percent increased rate was meant to only last two years, ending this June 30.

“I stand in opposition to this amendment,” Rep. Patricia Lundstrom, D-Gallup, told Rep. James White, R-Albuquerque, who wants to make the 1.5 percent increased contribution rate permanent.

“This is a very difficult decision, but we’ve kicked the can down the road,” White said during the ongoing debate.

Advertisements

About triptothecapitol

Trip Jennings is a Capitol reporter at the Santa Fe New Mexican.
This entry was posted in 2011 New Mexico Legislature, Education, New Mexico State Budget, Public school teachers, State workers, Uncategorized. Bookmark the permalink.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s