Lillard Recommends Reforms To State Pension Plan

Tuesday, February 26, 2013

State Treasurer David H. Lillard, Jr. is recommending that the General Assembly adopt a number of reforms to the state’s retirement plan for public employees. The Tennessee Consolidated Retirement System (TCRS) is a well-funded pension plan.  The proposed changes will only apply to state employees, higher education employees, and teachers hired on or after July 1, 2014 and will ensure the continued financial strength of the TCRS. The bill will not affect the retirement benefits for current state employees, higher education employees, or teachers. 

“I want to stress that the changes I am recommending would not affect eligibility or benefits for employees or retirees who are already part of TCRS,” Treasurer Lillard said. “In fact, making these changes will help ensure that TCRS remains financially secure to honor the commitments made to those employees and retirees.”

Because pension plans carry costs and liabilities that stretch over many decades, Treasurer Lillard said it is important to look well into the future when evaluating a plan’s financial health.

“Let me be very clear: TCRS is in good financial shape right now, just as it has been for many decades,” Treasurer Lillard said. “That’s attributable to a number of factors, including the General Assembly’s commitment to ensuring TCRS is adequately funded, an effective investment strategy and fair but conservative benefit payouts. However, it is important to take a long view when trying to anticipate what a retirement plan’s future costs will be. Based on the actuarial projections and other information my staff and I have studied, we believe changes are needed now to protect taxpayers, employees and retirees in the future.”

Treasurer Lillard presented the General Assembly’s Council on Pensions and Insurance with proposed legislation Monday that, if adopted, would implement his recommendations. He is scheduled to have a more detailed discussion with council members during a follow-up meeting March 4.

The changes he is proposing would limit the state’s future liability for pension costs by creating a hybrid between a defined benefit plan, which guarantees specific payouts to retirees based on a formula, and a defined contribution plan, in which the state would provide fixed amounts of money to employees’ 401(k) or similar types of accounts.

The reforms would also reduce pension costs by adjusting the formula used to calculate retirement benefits, raising eligibility requirements and collecting employee payroll deductions.  The new plan will also have cost controls that will apply only if the plan’s total costs exceed certain thresholds.

“In 2003, state taxpayers were spending about $264 million annually to support the pension system,” Treasurer Lillard said. “That number had grown to $731 million last year. Based on projections we have seen, the cost could go up by one-third or more over the next 10 years if changes aren’t made, which would push the taxpayers’ total annual expense above $1 billion.”

For further information, go to www.treasury.tn.gov/tcrs and select the tab titled “Proposed State and Teacher Plans.”


Former City Attorney Randy Nelson Goes On Disability Status

 By Order of the Tennessee Supreme Court entered February 17, 2017, the law license of Randall Lee Nelson was transferred to disability inactive status pursuant to Section 27.3 of Tennessee Supreme Court Rule 9. Mr. Nelson cannot practice law while on disability inactive status. He may return to the practice of law after reinstatement by the Tennessee Supreme Court ... (click for more)

Local Utilities Raise Awareness Of Utility Worker Imposters

Chattanooga Gas, EPB and Tennessee American Water officials will have a joint media event to share tips on how consumers can protect themselves from utility worker imposters and other utility-related scams. The event will take place on   Tuesday, February 21 at  10:30 a.m. in the  cul-de-sac in front of Tennessee Aquarium, 1  Broad Street. (click for more)

Man, Child Killed In Crash On Highway 136 In Walker County; 2nd Child Seriously Injured

  A man and an unrestrained five-year-old child were killed when a vehicle went out of control on Highway 136 in Walker County on Saturday. A 10-year-old in the car was seriously injured. The driver was thrown from the van and was dead at the scene. The four-year-old was trapped in the vehicle and also died at the wreck site at Ponder Creek Road. The Georgia State ... (click for more)

2 People Shot After Domestic Dispute In Brainerd; Corey Moon Taken Into Custody On Saturday Night

Two people were shot during a domestic dispute in Brainerd late Friday night.   Chattanooga Police responded at 11:17 p.m. to the 4700 block of Rogers Road on a shooting. The following are the preliminary facts of that investigation.   Officers were able to locate two victims, Cortez Moon, 23, and Terri Dossett, 45, suffering from non-life threatening gunshot ... (click for more)

Rhonda Thurman: Speaking The Truth About CSLA - And Response

One parent called me a “Liar” during Thursday’s Facilities meeting. Others from CSLA have been a bit more creative saying that I spread “misinformation”, “falsehoods” and “spread inaccurate statements”. Then there were more descriptive terms- “arrogant”, “uninformed”, “unprofessional”- if these CSLA parents don’t stop, they are going to hurt my feelings. In this letter, I will attempt ... (click for more)

Roy Exum: It Ain’t Gonna Work

In the last seven days, there have been seven different people who have been shot in separate incidents in Chattanooga. On Tuesday, the City Council approved a total $223,656 in street cameras and accessories to take pictures of our gangstas when the cops already know them by first names. Late last month it was announced the Chattanooga Police Department would double our gang violence ... (click for more)