Status of NCEA Lawsuit
In a hearing before a Wake County judge on March 30, attorneys for the state asked the court for a dismissal of the NCAE lawsuit against the state, presenting arguments to substantiate their claim that the General Assembly acted within its constitutional limits in the passage of Senate Bill 727, No Dues Check-off for Active and Retired School Employees. Having already received a Temporary Restraining Order maintaining the status quo on dues deduction, the attorneys for NCAE asked the court for a preliminary injunction, insisting that the actions of legislators were in clear violation of constitutional constraints. They argued that the law is unconstitutional because it unfairly and unlawfully discriminates against NCAE, targeting that group and abridging the group’s freedom of political speech. They further allege that the legislation is unconstitutional because the General Assembly failed to consider it when it was required to do so, and then enacted it in an unconstitutional midnight session. Moreover, they claim that the radical legislation was passed in retaliation against NCAE and NCRSP for exercising their First Amendment right to lobby against anti-education legislation.
Judge Gessner, who presided over the hearing, ordered that his Temporary Restraining Order would remain intact until he makes a ruling in the matter. He hopes to make a decision by the time the General Assembly convenes for a short session in May.
NCRSP Recommendation to Retirement System Board of Trustees
The 2011 Session of the General Assembly adopted a budget that fully funds the Teachers’ and State Employees’ Retirement System for the 2011-2013 biennium. The budget set the Annual Required Contribution (ARC) to TSERS at 7.44% for 2011-12 and at 8.33% for 2012-13. The 8.33% for 2012-13 exceeds the new ARC established by the state actuary (7.69%) to keep the system solvent. As a result of this differential, the state budget for the second year of the biennium has $63.3 million allocated from the General Fund that is in excess of the new ARC set by the actuary. The reason for the difference is not investment gains, but rather the failure of the state to increase salaries as projected. The new valuation report validates the conclusion that the primary driver of the excess is the differential between the projected ARC used by the General Assembly to establish the budget for the second year of the biennium and the ARC used by the actuary.
NCRSP is recommending to the Retirement System Board of Trustees that the additional funds be used to grant a 1.9% cost-of-living adjustment.
NCRSP Legislative Goals for 2012
NCRSP has adopted the following legislative goals and priorities for 2012 as essential to the improvement of the welfare and security of retired school personnel:
General Assembly Short Session
A special session of the General Assembly has been scheduled for April 27, but the official “short session” for 2012 convenes on May 16.
Bob Severs, Chair