Alabama Supreme Court halts refunds to public education employees

September 13, 2017

By Josh Moon
Alabama Political Reporter

The Alabama Supreme Court has put a hold on the return of millions of dollars to state educators while the justices consider an appeal of a ruling that deemed Public Education Employees Health Insurance Plan premium increases illegal.

Montgomery County Circuit Court Judge Johnny Hardwick ruled in August that a meeting of the PEEHIP board in April 2016, at which members voted to raise premiums, was held illegally. That meant that the premium increases paid in by all PEEHIP members – some $60 million – would have to be returned.

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Attorney General OKs withholding millions from educators

September 10, 2017

By Bill Britt
Alabama Political Reporter

Quietly under cover of so-called attorney-client privilege, educators are being denied millions of dollars, and the state’s Open Meetings Act is in jeopardy.

The Alabama Education Association recently celebrated winning a lawsuit alleging the Retirement System of Alabama’s PEEHIP Board met illegally to improperly raise state employees’ health insurance rates – PEEHIP is short for Public Education Employees’ Health Insurance Plan, which provides health coverage to education workers.
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Judge rules in favor of AEA in PEEHIP lawsuit, striking down health insurance rate hike

August 22, 2017

By Chip Brownlee
Alabama Political Reporter

The Alabama Education Association has won a lawsuit alleging that the Retirement System of Alabama PEEHIP Board met illegally and improperly raised state employees’ health insurance rates.

A Montgomery County Judge, Johnny Hardwick, issued the ruling Sunday in favor of the AEA. In the 13-page order, Hardwick agreed with the AEA’s allegation that the meeting — which ended in an increase in premiums and surcharges on spouses’ rates — was held outside of the purview of the Alabama Open Meetings Act, ruling the rate changes invalid.

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Alabama Leadership Has Become A Reverse Robin Hood

May 13, 2016

By Minority Leader Rep. Craig Ford

State leaders in Montgomery have become Robin Hoods—just not the kind that everyone remembers hearing about as a child. Instead of taking from the rich to help the poor, we’ve started taking from the poor to give to criminals. Alabama’s leadership has become nothing more than Robin Hood in reverse.

State leaders needs to refocus; trying to give money that should go to our children’s education and healthcare to build super prisons is not the Alabama values voters thought they would be getting. Since when did the comfort level of murders and rapists supersede properly paying the law enforcement officers guarding the prisons? It certainly shouldn’t supersede the pay raise that our state employees, educators and retirees deserve.
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PEEHIP Board Raises Health Insurance Premiums on Education Employees

April 29, 2016

By Brandon Moseley
Alabama Political Reporter

Wednesday, April 27, the PEEHIP (Public Education Employees Health Insurance Program) board voted 7 to 6 to increase the monthly health insurance premiums for education worker and retirees insured by the plan.

Beginning on October 1, 2016 single plans will see a $15 a month rate increase. Family plans will be increased by $30 each month. A vote to utilize up to 10 percent of the PEEHIP Trust to offset the rate hikes was defeated on a 7 to 6 vote.
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Kay Ivey Said Challenges Remain While Legislature Studies Budget Issues

June 9, 2015

By Brandon Moseley
Alabama Political Reporter        

On Monday, June 8, Alabama Lieutenant Governor Kay Ivey (R) commented on the recent legislative session in a statement on Facebook.  Lt. Gov. Ivey said that despite the many challenges progress was made, but that a special session will be need to deal with the State General Fund Budget (SGF).

Lt. Gov. Ivey said in a statement, “It was my honor to preside over my fifth Legislative Session which wrapped up last Thursday. Right out of the gate, Legislators were faced with many difficult challenges — the budgets, prisons, and Medicaid. Senator Cam Ward presented a comprehensive prison reform bill and Senator Greg Reed proposed another positive step forward to manage Medicaid in our State. Progress was made, but we still have challenges ahead. We are sure to return for a Special Session to deal with the General Fund Budget, but for now, the Alabama Senate is adjourned sine die.”

Figuring out how to deal with the budgets also concerned the Alabama House of Representatives.

Speaker of the House Mike Hubbard (R-Auburn) has created a commission to study the problem.

Speaker Mike Hubbard said in a statement on May 26, “Proud to announce the formation of the Speaker’s Commission on Earmarking and Budget Reform. Since Republican passage of the Proration Prevention Act, our first budget reform effort in 2011, devastating mid-year cuts have been eliminated. I’m confident that this commission will recommend similar commonsense solutions to Alabama’s budget challenges. The members of the Commission include: Representative Will Ainsworth, Representative Elaine Beech, Representative Terri Collins, Representative Steve Clouse, Representative Allen Farley, Representative Bill Poole, and Representative Rod Scott.”

Representative Clouse (R-Ozark) is the Chairman of the House Ways and Means Committee General Fund; while Representative Bill Poole is the Chairman of the House Ways and Means Education Committee.

Another issue that is perplexing legislators is the growing costs of providing health care and pension benefits for state employees. To that end, the Alabama Legislature passed a joint resolution to establish a study committee on Alabama’s public pension system and public employee health insurance program (PEHIP).  This initiative was led by Senator Arthur Orr (R from Decatur) and Representative Jim Patterson (R-Meridianville).

The conservative Alabama Policy Institute (API) applauded the move in a statement:  “Underfunded pension systems are a major, yet hidden, driving force behind continued state budget shortfalls across the country. At a time when legislators are grappling with a $200 million budget shortfall, the State of Alabama is set to spend nearly $1 billion this year on public pensions. This is due, in part, to the high risks associated with a traditional defined benefit structure.”

API wrote that, “Structural pension reform is not a short-term budget fix, but for the long-term remains the single biggest reward for states attempting to solve the budget woes brought on by the recession and the extended economic recovery that followed…API applauds the leadership of Senator Orr and Representative Patterson and looks forward to working with the committee on this important issue.”

A growing number of legislators are calling for replacing the state’s pension fund (the Retirement Systems of Alabama, RSA) with a 401k system where the state does not guarantee returns or a specific benefit amount.  Sources tell the Alabama Political Reporter that without new hires coming in and paying the pension for those already drawing that the RSA will need significant monies to backstop the existing pension fund so that all of those current employees and retirees will get the benefits that they were promised.

Soaring healthcare costs due to Obamacare and an aging population of State retirees and workers has driven up the cost of providing healthcare benefits to both workers and retirees. Despite having the second largest ETF budget in state history, PEEHIP this year was only level funded leaving a gap of over $100 million. PEEHIP Board members narrowly voted to fill most of that shortfall by raiding the PEEHIP Trust Fund.

Kay Ivey is the first Republican woman to serve at Lt. Governor in Alabama. This is Lt. Gov. Ivey’s second term. There is some discussion that the very personable Lt. Governor might be a gubernatorial candidate in 2018.

 

House Ways and Means Committee Moves to Cancel Teacher Pay Raise

March 18, 2014

By Brandon Moseley
Alabama Political Reporter

On Wednesday, March 12 the House Way and Means for Education Committee approved an education budget without the 2% pay raise that Governor Robert Bentley had included in his budget request, which has been rejected by the Senate and now by the House Ways and Means Committee.

The teachers had been asking for a 5% pay raise.  The Governor has threatened to veto the education budget if the legislature sends him an education budget without the requested pay raise.  Governor Bentley said, “The Education Budget I presented is good and balanced. I’m asking the Legislature to pass my 2% pay raise for teachers and support personnel, and fully fund PEEHIP to the level requested by the PEEHIP board.  If the Legislature doesn’t include that in the ETF, I will send that budget back with an Executive Amendment.  Our teachers work hard and deserve this pay raise.”
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Bentley Threatens to Veto Education Budget

March 7, 2014

By Brandon Moseley
Alabama Political Reporter

On Wednesday, Alabama Governor Robert Bentley (R) publicly announced that if the legislature passes an Education Trust Fund (ETF) budget that does not raise the pay of Alabama teachers then he will veto that budget.

Governor Bentley said, “The Education Budget I presented is good and balanced. I’m asking the Legislature to pass my 2% pay raise for teachers and support personnel, and fully fund PEEHIP to the level requested by the PEEHIP board.”
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PEEHIP Faces Massive Shortfall

January 1, 2014

By Brandon Moseley
Alabama Political Reporter

The Patient Protection and Affordable Care Act (PPACA) of 2010, popularly referred to as “Obamacare” is changing much of what we know about the health care insurance industry and there are both winners and losers with the landmark health insurance reform legislation.  One of the losers is the State of Alabama where increasing costs of insurance combined with medical inflation (particularly in drug costs) and early retirements by teachers and education employees leading to an increasing number of educators, retired educators and dependents on the plan means that the Public Employees Health Insurance Plan (PEEHIP) is facing a projected $220+ million shortfall in the 2014/2015 budget year which goes into effect on October 1.
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Education Legislation Coming Up This Week

April 30, 2013

By Brandon Moseley
Alabama Political Reporter

Time is running out on the 2013 legislative session and several bills affecting education employees are on the calendar for the closing days of this session. The Alabama Education Association (AEA) addressed some of these issues in the Monday’s ‘Alabama School Journal.’
The biggest of these is of course the education budget. Alabama Governor Robert Bentley (R) proposed an education budget that gave education employees a two and a half percent pay raise across the board. The Alabama House rejected that budget and instead passed a budget with just a two percent pay raise. The Alabama Senate cut that raise to just a one percent pay raise though included language giving up to a one percent one time bonus “IF” the state meets all of its revenue projections. The legislature has to resolve the differences between their competing education trust fund budgets.
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