Vermont Legislature SmartTranscripts:

[Senator Rebecca "Becca" White (Member)]: Good

[Senator Brian Collamore (Chair)]: afternoon once again. Welcome back to the Senate Committee on Government Operation. This is our meeting on third day, April second, and our final item up for consideration is H519, enacting relating to Vermont State Employees Retirement System Group G membership. And I have had Cameron Wood on the agenda, he may not have been able to join us. We are going to be joined by Chris Moore, who's a labor representative with the United Federation of Police Officers. Is that you? Yes, sir. Okay. Please join us. Thank you for having me. Sure.

[Chris Lavoie (Labor representative, United Federation of Police Officers)]: I don't believe I've spent too much time

[Senator Brian Collamore (Chair)]: on this committee. Your session looks not that familiar. It was last session, but

[Chris Lavoie (Labor representative, United Federation of Police Officers)]: a completely different topic. So I would like to start just by saying thank you for having me. We will give you some space to talk about this. I was out of state when it was in the house so I didn't have an opportunity there. And I'd also like to just say thank you for the work that you did on S89. Was great and My I really, really appreciate name is Chris Lahore. I'm a labor representative. I primarily represent public safety employees throughout the state of Vermont. I also represent employees in New York and throughout New England.

[Senator Rebecca "Becca" White (Member)]: So who do you represent? Because I actually am not familiar with your department. Randolph Police Department is So one of

[Chris Lavoie (Labor representative, United Federation of Police Officers)]: I also represent Windsor, Springfield, Brattleboro, Bennington, and a couple others. So fairly recent change. This is a really unique situation. I'm usually very well versed in VMARS. I don't usually deal with ACEs too often, but in this unique situation I do. I know this committee has taken a lot of testimony as it relates to vCERG, group C, and things like that already through other statutes or other bills rather. And BIMRS allows you to bargain, collectively bargain your pension plan. VCRS doesn't. VCRS only, a change can only occur through legislative action. When I'm at the bargaining table at Randell and the employees ask for research C or the merge D, that can't happen for them. It has to be done legislatively, which is where this bill originated from. This bill was originally drafted and submitted as a group C

[Senator Brian Collamore (Chair)]: Plan.

[Senator Rebecca "Becca" White (Member)]: Sorry, I'm trying to understand this. Who had asked for that and why didn't it come?

[Chris Lavoie (Labor representative, United Federation of Police Officers)]: I believe it came, well, if I back up, through our last collective bargaining session, which was about two years ago or a year and a half ago, something along those lines, we had a proposal where we requested B versus C, B versus D, knowing we can't accomplish that at the bargaining table, but we wanted to have a conversation with the municipality. So from there, mostly through the work of the municipality, there was a bill that was filed for this group, the police officers of the Randolph Police Department to go into BeeSer's group safety. Was that bill filed in a previous biennium?

[Senator Tanya Vyhovsky (Vice Chair)]: Yeah. Because we can't because this one, I mean, was was clearly filed requesting to go

[Chris Lavoie (Labor representative, United Federation of Police Officers)]: into group g. If I recall correctly,

[Senator Rebecca "Becca" White (Member)]: it was a change that was made on the house side. No. It was introduced with

[Senator Tanya Vyhovsky (Vice Chair)]: the title of that play, the Boston Employees Retirement System Group G membership. Chris.

[Chris Rutland (Joint Fiscal Office)]: Chris from Joint Fiscal. It was originally introduced as a short form bill based on group c membership. A Sprague Hall amendment was made that switched it to group g as part of the parliamentary process that the house clerk does. She then updated the title of

[Chris Lavoie (Labor representative, United Federation of Police Officers)]: the bill to actually reflect what it did.

[Senator Rebecca "Becca" White (Member)]: Okay. Thank you.

[Chris Lavoie (Labor representative, United Federation of Police Officers)]: Thank you, really

[Senator Tanya Vyhovsky (Vice Chair)]: appreciate I that

[Chris Lavoie (Labor representative, United Federation of Police Officers)]: don't necessarily understand that. No, it doesn't. Hold on, I'm not this, so I appreciate that. That's just a little bit of history. Some of the things I've heard through testimony is that there isn't an impact on the state budget because the cost is borne by the employees, the employer. One piece that I think is important to understand, and I'll reference it a little bit later, the increase to, if they were to go to group G, the increase not only is greater to the employee than it would be if they went to group C,

[Senator Rebecca "Becca" White (Member)]: but the increase is entirely borne by the employee, not by the employee earned. Okay, Sandra Vyhovsky? My question is actually for Chris. If the Group C change were made,

[Senator Tanya Vyhovsky (Vice Chair)]: that would no longer be fiscally neutral, correct?

[Senator Brian Collamore (Chair)]: Chris from joint fiscal debt is correct. Group C is would represent a additional increase to the employer, primarily state government. When the other Chris is finished in the stand, I could Okay. Could walk the committee through a little more about how we do things, but we pay a blended rate through the pension system that is subsidized on the employer side. But that does not reflect the fact that group c and group d, which are the judges on a per group basis, are much, much, much more expensive to the system than group f or group g.

[Chris Lavoie (Labor representative, United Federation of Police Officers)]: Going on, we we heard that in in perhaps this would be different but the department size is de minimis. The heavy mileage on law enforcement officers especially if they're required to do you know thirty years or work until can't collect their retirement until they're 55. Under Beamer's D an employee can collect their retirement at age 50 with twenty years. So there is an early retirement component which I believe was testified on earlier today or previously as it relates to early retirement for beamers d and vCERs c. So when you talk about departments other municipal departments of similar size so Fairhaven PD, Castleton, Windsor, Ludlow, or even others like Newport, those employees can work twenty years and collect F-fifty.

[Senator Brian Collamore (Chair)]: Senator Nielsen?

[Senator Tanya Vyhovsky (Vice Chair)]: So I'm just not as familiar with the municipal lands. Does group D have a mandatory retirement age?

[Senator Brian Collamore (Chair)]: It does not.

[Senator Tanya Vyhovsky (Vice Chair)]: Because group C does. Correct. And we've heard from the Randolph Police that they do not want a mandatory retirement age.

[Chris Lavoie (Labor representative, United Federation of Police Officers)]: I will, I'll clarify that by saying that that was the that was the municipality. I've I've spoken to the the employees, the bargaining unit employees, and they very much feel that they would be better served in group c.

[Senator Tanya Vyhovsky (Vice Chair)]: My next question, this is a question that we don't have a solid answer to from the treasurer's office, but I asked a lot of questions about this yesterday, is would it make more sense for these three people to go into the theme or system like all of

[Senator Rebecca "Becca" White (Member)]: the other municipal police? I think,

[Chris Lavoie (Labor representative, United Federation of Police Officers)]: you know, if we could go back in time, maybe something would be different. I think there are other benefits in the state system that retirees benefit from that Deaners doesn't have. Okay.

[Senator Tanya Vyhovsky (Vice Chair)]: That's why it's more expensive. Yes. I also, it would be a pretty, putting this one small group into group C would be a pretty stark departure from all other law enforcement in the state system are not state troopers. Correct. So I was just trying to

[Chris Lavoie (Labor representative, United Federation of Police Officers)]: get a sense of I think most certified state law enforcement officers are out of group, same.

[Senator Tanya Vyhovsky (Vice Chair)]: The state troopers are, but we recently moved sheriffs into group g. Correct. And that was sort of what what this was. It was sort of cleanup is we didn't realize because at the time the Randolph Police Department didn't really exist. We didn't realize that this police department and the two other sort of non functioning police departments were in the state employee system and would also need to be moved, like the sheriffs, to group g.

[Chris Lavoie (Labor representative, United Federation of Police Officers)]: And there are and there are some there are some sheriffs that are up in group c.

[Senator Tanya Vyhovsky (Vice Chair)]: Are those the transport deputies? I think they're

[Senator Rebecca "Becca" White (Member)]: just the transport deputies. Yeah. So I think DMV,

[Chris Lavoie (Labor representative, United Federation of Police Officers)]: efficient game, DLL, those law enforcement officers are also

[Senator Rebecca "Becca" White (Member)]: But most municipal law enforcement is not County. The only municipal law in Or or Venus. Or or Venus. Yep. Yep.

[Chris Lavoie (Labor representative, United Federation of Police Officers)]: Just touching on them, know their primary purpose is to conduct law enforcement duties full time. They do the full spectrum of law enforcement activities which is a requirement for group c. The Randolph employees, if they were in group c, would take anywhere between 2.8% to 3.25% as of today home. Take that much more home annually if they were in group c versus group chain because they have the employee contribution. I've already mentioned this. Randolph police officer would be able to retire five years earlier at age 50 versus 55. We heard testimony from the chief just recently how he wants to do his 20 and he's done. That wouldn't necessarily be possible if someone started their career at 30 years old worried for a chief they would have to look for

[Senator Rebecca "Becca" White (Member)]: a different product. Good to hear from the chief yesterday. Mhmm. He was on us too.

[Chris Lavoie (Labor representative, United Federation of Police Officers)]: Yeah. Get that. And the ramp just looking at the bar you know, the Randolph Police Department, we have two female officers who who were mentioned. One of them is currently serving overseas in our country's military. The other was recently referenced in a great article on their law enforcement career and what brought them to Randolph. Officer is set to retire and they won't switch from group f even if they go to g or c. So that person as of right now has already made that determination. And then just as a comparison, because we talked about recruitment and retention and the benefits package, one of their employees recently was in final stages of being hired by DMV enforcement, is in group C. And so I think when we look at, like, why not group C? And there may be information that I don't know. But if what is needed is to alleviate burden and create equity in the benefits and recruitment and retention, I think the employees feel that this is best served through group C.

[Senator Brian Collamore (Chair)]: Thank you, Chris. Yes. Any questions for Chris? So let me invite Chris Rutland to answer potential questions. Hey, everyone. Chris Rutland, Joint Fiscal. I didn't prepare anything today, but I just wanted to mention a few things about how these groups are a little different is, I think everybody, I think accurately noted that right now group C is state law enforcement officers and the state paid transport deputies. They're, to my knowledge, no municipal members in group C. And I just wanna mention on the money side that we were talking about her genius. Genie was intentionally deductible cost neutral to the employer because that incremental cost of the better benefit is borne by the employee.

[Chris Rutland (Joint Fiscal Office)]: That is not the case with group C. The pension task force that we had, it was five years ago already, engaged the actuaries at the time to look at this very issue of like, if we didn't right now we do everything with a blended rate. So they look at the entire system across all the groups, and then they calculate the employer contribution rate based on that blended rate. The overwhelming majority of the members are in group F. There was around 50 or so members in group D, are the judges, around 400 or so members in group C. But the group C and group D benefits are much, much more expensive on a group specific basis, because not only is the benefit formula more generous, but the entry and exit age patterns of those groups are very different. So when you think about, that actually matters a lot in terms of how much a benefit costs. So like if you enter early in your career and you leave early in your career, or you enter really late in your career, only work for a little bit and then leave, like in the case of a judge, those have much more higher costs on a per member basis than people who, excuse me, might get hired in their twenties and thirties and have a range of experience and retire at different ages. Group C and Group D due to their behaviors and their characteristics on a per member basis are like twice the cost of what Group F is. So we cross subsidize those costs on the employer side through VCRPS. So I'm in Group F. What I pay doesn't go towards subsidizing Group C and Group G. It doesn't even fully cover the cost of my normal cost in her bed. The cross subsidy happens on the employer side. So there's lots of reasons why it makes sense to do it this way. And this is a long way of saying that if any municipal employer was just charged the blended rate that they currently pay, which probably around 18 ish percent, it's in that neighborhood, that doesn't come close to covering the actual cost of those matters in Group C. So if that were a group specific rate with no cross subsidization, the five year old analysis that we had done back then, if there was no cross subsidization, Group C would be like 50% of payroll, be the cost to fully cover. So it wouldn't be like the member paying all that, but that would be a member plus employer. So the fact that a huge percentage of the people are in Group F, and Group F is much less expensive, that brings down the cost of Group C and Group D for everyone else. So that analysis is posted on the legislative website if anybody's watching. It was in September 2021, so you have to go in the archives and go to our prior session, but you can see the materials that Siegel, the actuaries, prepared for us. You know, it was five years ago, there have been, that was pre Act 114. So, you know, some of the percentages have changed since then, particularly on the unfunded liability side, because we've been making additional We've been approving that, but the overall trend is still better. Doctor. Vyhovsky?

[Senator Tanya Vyhovsky (Vice Chair)]: I have a question that is maybe a tiny bit outside of your wheelhouse, but I know that you know the pension system quite well, and that is about the group C membership. It's all people that are doing statewide law, some extent. Right? Like, transport deputies are moving people across the state throughout the state. DLL has the ability, like, the ability to do enforcement throughout the state.

[Chris Rutland (Joint Fiscal Office)]: I'd say the, you know, I'd say the common thread is maybe not necessarily about whether you're performing things statewide, but

[Chris Lavoie (Labor representative, United Federation of Police Officers)]: you're funded out of the

[Chris Rutland (Joint Fiscal Office)]: state budget. Yes. Capital police are included in group C because they're part of state government law enforcement, but they don't travel outside So of the it's 100% Is that what you said, Chris? No, if you're funded through the state budget. So it doesn't necessarily mean it's all in the general fund. Could be

[Senator Tanya Vyhovsky (Vice Chair)]: other- But the normal cost of those employees comes out of our general fund. We don't have a direct funding stream

[Chris Rutland (Joint Fiscal Office)]: to the It is complicated. So in VCERS, the costs are charged to the funds that employ the active workforce. So if you are like the efficient wildlife law enforcement officer, that might not be paid out of a general, that might be paid out of a special facility. Okay. If your DMV, you know, that you're funded out of the TEAS Fund. So those costs do not, the VSERs costs do not show up as a line item in the state budget the way the teachers pension costs do, because the B SERV costs are embedded in the payroll budgets that employ all of the B SERV members. If we didn't have this of cross subsidization going on that we did, then public safety and the judiciary would have very, very, very high pension costs. Even higher. And those costs would largely be borne by the general fund. Whereas the rest of state government that employs group F would see a slightly smaller cost, and that gets a little tricky because federal funds pay for some of those folks. So by using a blended rate, it is a nice streamlined way to try to smooth all these costs out equally across all the places that pay for our income staff. Any other questions for Chris Rutland?

[Senator Rebecca "Becca" White (Member)]: Okay.

[Senator Brian Collamore (Chair)]: Thank you. Thank you. I was hoping that Senator White would be back, as I can tend to vote this out, but I guess we'll have to wait until tomorrow to do that. I'm trying to recall from yesterday's testimony. It seemed like the police chief specifically said they did not want to be in group c. I think he said that more than once.

[Senator Rebecca "Becca" White (Member)]: I don't even recall group c coming up and out of here.

[Senator Tanya Vyhovsky (Vice Chair)]: It did. It it did. But I also recall hearing testimony that they do not want the mandatory retirement age.

[Senator Rebecca "Becca" White (Member)]: So they would be the only municipal police in Berks City. Is that what I'm understanding? Yes. That would be the case. So that's not a good precedent to set.

[Senator Brian Collamore (Chair)]: Especially if we kind of fixed it. Yeah, this was created, this

[Senator Tanya Vyhovsky (Vice Chair)]: And we would need a fiscal note because it would no longer be

[Senator Rebecca "Becca" White (Member)]: Correct. Budget

[Senator Brian Collamore (Chair)]: And I think we also heard from the former town manager, I gave her credit for still being

[Senator Rebecca "Becca" White (Member)]: Oh, the chair. The select Former chair. Chair. She was chair of select

[Senator Brian Collamore (Chair)]: That the town is not in favor of

[Senator Tanya Vyhovsky (Vice Chair)]: Yeah.

[Senator Rebecca "Becca" White (Member)]: Because then we'd have to go back to the employer because the burden is clearly on the employer to pick up the additional cost. So I think it's hard if they would be the only police department in the state that was at group c. Yes. It would be a great way to forgive.

[Chris Lavoie (Labor representative, United Federation of Police Officers)]: Well, only They're only local municipal police department in Beersdorf so you know, it's a it's a very unique situation. It is. That that was decided a decade ago. Yeah.

[Senator Rebecca "Becca" White (Member)]: Right. But it's time that maybe happened to be a little less unique.

[Senator Tanya Vyhovsky (Vice Chair)]: No. Well, that's why honestly, like, if it if JFO it wasn't JFO. Was the treasurer's office. Wasn't so surprised by some of my questions. It almost makes more sense to me, instead of moving them into Virginia, move them into the municipal system like The ball. The other municipal police.

[Senator Rebecca "Becca" White (Member)]: The real police is kind of I I issues were.

[Senator Tanya Vyhovsky (Vice Chair)]: I heard that, and then I I'm I I understand that there weren't

[Chris Lavoie (Labor representative, United Federation of Police Officers)]: It was pulling the funds.

[Senator Tanya Vyhovsky (Vice Chair)]: There were more well, and and the question that wasn't being able to be answered is what if we sort of said, yes. The currently that are pay the people currently paying out of the system are paying into this system, but someone who's hired new will pay into the other system. And as a means of moving in that direction, and the treasurer's was surprised and unable to fully Right. I asked a question that I had never contemplated. Yeah. Because I actually think, a standpoint of what makes the most sense figuring out product transitions and also

[Senator Rebecca "Becca" White (Member)]: Maybe the municipal that is something to contemplate for next Yeah,

[Senator Tanya Vyhovsky (Vice Chair)]: like in the meantime, I think, fine, let's move it into group G to at least get closer

[Senator Brian Collamore (Chair)]: Yeah, yeah, yes.

[Senator Tanya Vyhovsky (Vice Chair)]: To the ability to retire earlier than someone in group F and some of that, but I actually think, like from a logical and equity standpoint, they should just be in the same system as all the other municipal officers.

[Senator Brian Collamore (Chair)]: So Senator White has joined us.

[Senator Rebecca "Becca" White (Member)]: Would you entertain a motion? But just so I understand, we're doing what the Randolph police officers want us to be doing, not what this person, this person.

[Chris Lavoie (Labor representative, United Federation of Police Officers)]: We have the employees and the employer, I'm the employee. So, the bargaining of the employees.

[Senator Rebecca "Becca" White (Member)]: I think we're delighted on what we heard of the employees. Yes.

[Senator Brian Collamore (Chair)]: But I'm pretty sure we are the police chief. He's a partner either.

[Senator Rebecca "Becca" White (Member)]: He's the administrator. Okay. Okay, well I support, I will listen and trust that we are doing what the correct stakeholders are addressing. Do you want

[Chris Lavoie (Labor representative, United Federation of Police Officers)]: to We get some

[Senator Brian Collamore (Chair)]: had testimony yesterday from Tim Duggan from the Treasurer's Office that moving them to Group C is not what the Treasurer's Office would suggest. And we just heard from Chris Rutland that it would actually not be of de minimis impact, that it would impact the The taxes. The pension.

[Senator Tanya Vyhovsky (Vice Chair)]: So Do you have a graph for that?

[Senator Brian Collamore (Chair)]: To a greater degree.

[Senator Rebecca "Becca" White (Member)]: Okay. And we are amending the bill then? No. No. Oh, we don't need to We're

[Senator Brian Collamore (Chair)]: going to be, I think, we'll be training on the motions, but he makes agreeing with the House H519 and without amendments favorably voted.

[Senator Rebecca "Becca" White (Member)]: That would be my I

[Senator Tanya Vyhovsky (Vice Chair)]: prefer not to report it.

[Senator Rebecca "Becca" White (Member)]: I know.

[Senator Brian Collamore (Chair)]: I'll I'll be glad to report it.

[Senator Rebecca "Becca" White (Member)]: So I would move that we pass out of senate government operations h five nineteen as passed by the House. Okay.

[Chris Lavoie (Labor representative, United Federation of Police Officers)]: Mister Carter? Yes. Senator Clarkson? Yes. Senator Morley, yes.

[Senator John Morley III (Clerk)]: Senator Vyhovsky?

[Senator Rebecca "Becca" White (Member)]: Yes. Senator White? Yes. Senator Call?

[Senator Brian Collamore (Chair)]: Yes. And you can put me down the report. Okay. And I'll ask Cameron Wood to provide us with a section by section. So it'll be on the floor for probably Tuesday.

[Senator Rebecca "Becca" White (Member)]: It'll be on notice? Okay. Two gun hospitals on Wednesday.

[Senator Tanya Vyhovsky (Vice Chair)]: Two gun

[Senator Brian Collamore (Chair)]: hospitals on Did you already bring your charger up?

[Senator Rebecca "Becca" White (Member)]: I did it earlier,

[Senator Tanya Vyhovsky (Vice Chair)]: but it'll still be unnoticed. So

[Senator Brian Collamore (Chair)]: as soon

[Senator Rebecca "Becca" White (Member)]: as Sorry. The just figured it was a that was a big stretch.

[Chris Lavoie (Labor representative, United Federation of Police Officers)]: Okay. I I was going to ask too and I'm sure the answer is it can't be done in such a short period of time but the bigger issue being those five extra years that they have to work before they can qualify to retire. They were aware of that. Yeah, was just saying it's not something that, you know, that could qualify for, you know, at some point be adopting a group G for law enforcement because that's the piece that's missing from b emergency. Okay. What?

[Senator Rebecca "Becca" White (Member)]: The the work

[Senator Tanya Vyhovsky (Vice Chair)]: So if

[Senator Brian Collamore (Chair)]: they were in b

[Senator Tanya Vyhovsky (Vice Chair)]: emergency, they would be able to retire at 50?

[Chris Lavoie (Labor representative, United Federation of Police Officers)]: They could do twenty years and collect at age 50. Okay.

[Senator Rebecca "Becca" White (Member)]: If they were in b. B emergency. Okay.

[Senator Tanya Vyhovsky (Vice Chair)]: Mean Bemurs.

[Senator Rebecca "Becca" White (Member)]: Yeah. Yeah. Well, my preference is Four Bemurs.

[Senator Tanya Vyhovsky (Vice Chair)]: Preference is still to find them a ramp into Bemurs because I don't think they belong in the Bemurs system at all. I And the the

[Chris Lavoie (Labor representative, United Federation of Police Officers)]: only The only issue I would arise there, or the only thing I would raise to consider is that the health insurance retirement benefits are better in PACERs living fevers.

[Senator Rebecca "Becca" White (Member)]: Yes. That is good to know.

[Chris Lavoie (Labor representative, United Federation of Police Officers)]: I appreciate it and I'm

[Senator Rebecca "Becca" White (Member)]: sure. Sorry, it's just what it's in this tight budget there for us to be adding more at the moment. Completely understandable. And

[Chris Lavoie (Labor representative, United Federation of Police Officers)]: I didn't know if there was a way to have a cost share with me. Like I don't know how that back

[Senator Rebecca "Becca" White (Member)]: I end know system it's just going forward I think we're gonna have to have more cost share.

[Senator Brian Collamore (Chair)]: I think it's a big conversation.

[Senator Rebecca "Becca" White (Member)]: It's a huge We've worked really hard

[Senator Tanya Vyhovsky (Vice Chair)]: to stabilize the pension systems. Anything that makes Chris Rutland this, I'm

[Senator Brian Collamore (Chair)]: Well, it's at the center of Vyhovsky's point. Yeah. The state does not pay. That system is Those costs are shared between the employers and the members. Well, these

[Chris Lavoie (Labor representative, United Federation of Police Officers)]: are she is too. Right?

[Senator Brian Collamore (Chair)]: Well, all of the systems are, but in terms of state for the town employers, But it's I mean, in terms of the system writ large, if you put members in Vmers, whatever liabilities happen are paid by the towns and by the veterans. It does exist.

[Chris Lavoie (Labor representative, United Federation of Police Officers)]: Yeah, I just want to ensure the V service group C employer attribution could be for by the employee. Yeah. That be

[Senator Brian Collamore (Chair)]: that would require some significant administrative lifting on the treasurer's office side and likely a pretty sizing cost in the rest of the town, significantly more than they would be paying over. Anything else that the committee wants to address today? If not, we'll adjourn for the day and see all of

[Senator Rebecca "Becca" White (Member)]: you tomorrow. Thank you. Just think Just