Monday, March 29, 2010

MCEA Condemns Teacher Pension Shift

Following is a press release from MCEA opposing the shift in teacher pensions that was passed by the Senate. The release contains some pointed language directed at Senator Rich Madaleno (D-18), who authored the proposal and has been known as one of MCEA's best friends over the years.

March 29, 2010
FOR MORE INFORMATION CONTACT: Doug Prouty 301-294-6232

MCEA Condemns Effort to Shift State Pension Costs onto Counties Calls on County Delegates to Oppose Proposal

The Montgomery County teachers union today decried the last minute maneuver in the State Senate to shift hundreds of millions of dollars in state pension costs onto local counties. The union is mounting an intensive grassroots lobbying effort to convince Montgomery County delegates to the General Assembly to oppose the proposal.

“There is no other issue that unites everyone in Montgomery County as much as opposition to the shift in pension costs,” said Doug Prouty, President of the Montgomery County Education Association (MCEA). “Liberal or conservative, Democrat or Republican, pro-business or pro-labor, MCPS advocate or MCPS critic – everyone understands that shifting pension costs has a disproportionate impact on Montgomery County.” The pension funding formula is the only state aid program that favors Montgomery County.

The Senate proposal would shift $13 million in state pension costs onto Montgomery County in FY12, with the amount growing to $70 million a year by FY15. Seven of Montgomery County’s eight state senators voted against the proposal.

Prouty questioned why Kensington State Senator Richard Madaleno sponsored this proposal. “Rich Madaleno has been a stellar advocate both for our county and our schools,” Prouty said. “Rich may think that this is the best deal that Montgomery County can get and that he is doing the right thing, but if he can’t convince the rest of the political leadership of the county, he has no right to cut this deal on his own. Rich has overstepped on this, and it’s a shame.”

Prouty pointed out that the proposal is being rammed through at the last minute. The amendment surfaced for the first time last Thursday. It was voted out of committee on Friday, and passed the full Senate on Tuesday. Governor O’Malley had not included the pension shift in his proposed budget, and there had been no proposal to do so during the first eight weeks of the legislative session.

The state government controls the benefit levels in the pension plan. The state government controls the investments of the pension funds. Prouty says it makes no sense to require counties to pay pension costs for a pension plan they do not control.

“The amazing thing,” Prouty continued “is that this does nothing to improve the long-term financial health of the pension plan. We are committed to working with the state to ensure that the pension fund is stable. All this proposal does is pass the buck back to the counties while ignoring the need to improve the long-term health of the state pension plan.”

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