Bill to scale back unfunded liability surcharge passes House

The bill to scale down and eventually end the unfunded liability surcharge that impacts city pension costs passed the House with changes from the House Appropriations Committee. The bill now goes back to the Senate to consider the House’s changes.

We wrote about SB 5294 and it’s House Appropriations Committee amendments last week. The committee amendments slightly extended the schedule for scaling back the unfunded actuarial liability surcharge that cities now pay to make up for current underfunding in the PERS 1 system. Based on recent estimates, the bill could save local governments around $170 million in the next biennium alone. A new fiscal note is still needed to confirm how the House’s amendments will change local government employers’ cost savings over time.

The bill passed the House on a unanimous vote with no additional floor amendments. If the Senate accepts the House’s changes, the bill will go to the Governor for signature. If they don’t, the House and Senate will have until April 23 to work out any differences and pass a final bill. AWC supports this legislation.