This editorial first appeared in the Fairbanks Daily News-Miner:
The special session of the Alaska Legislature last month did produce a bill that aims to help stabilize the finances of the state-run Public Employees' Retirement System and the Teachers' Retirement System. The two systems combined have an estimated $5.7 billion unfunded liability, which became the cornerstone of rough debate throughout much of the work in Juneau.
While the debate did lead to legislation, it nevertheless left people with many questions and a confused understanding - if they were able to assemble one at all - of the scale of the problem, how it came into being and what solutions might be best.
With that much muddiness in the public's perception of the issue, it is good to hear that the House Special Committee on Ways and Means Committee will hold meetings throughout the summer to, in the words of the official announcement Thursday, "assess the implications of the unfunded liability ... and potential legislative measures to address that liability." The committee plans to meet in Juneau, Anchorage and Fairbanks.
Legislation passed at the end of the contentious special session, which ended in late May, will only affect new employees and therefore will do nothing about the billions in unfunded liability that burden participating government employers - namely the state of Alaska, the University of Alaska and many local governments such as the Fairbanks North Star Borough and its school district.
The House Ways and Means Committee's chairman, Republican Rep. Bruce Weyhrauch of Juneau, said the committee will work to present legislation in 2006 that will address the current liability of the retirement systems for existing employees so that the rising mandatory payments don't take money from other state programs.
Alaska has the money, of course, via the Alaska Permanent Fund to pay the entire retirement obligation if it really wanted to, but that is neither a real political option nor an appropriate option. And besides, such a course should never be allowed without answers to tough questions, and that's another important component of the Ways and Means Committee's undertaking: The committee wants to examine how the problem came into being and determine the role of PRS/TRS management in arriving at the shortfall.
The debating about the retirement systems has been loud, unruly by some, and full of misunderstanding by others. If the House Special Committee on Ways and Means can present a clear picture to the public, future discussion on the topic could be well served.
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