Teachers against Perdue's plan

Would end automatic pay hikes for retirees

Georgia teacher organizations are lining up to fight a proposal by Gov. Sonny Perdue that would end automatic cost-of-living raises for retirees covered by the state Teachers Retirement System.

About 80,000 retired teachers, professors and other school employees draw retirement pay from the system, and more than 250,000 people still in the workforce have teachers retirement accounts, according to the Professional Association of Georgia Educators.

Perdue wants to end a 38-year-old rule that grants 1.5 percent cost-of-living raises twice a year to retirees in the system, which includes not only public school teachers but professors and most other workers at the University of Georgia and other public colleges and universities in the state. About half of UGA's professors are not in the system because they chose an optional retirement plan that allows them to manage their own retirement funds.

Perdue wants the board that manages the Teachers Retirement System to change a rule it approved in 1969 so that retirees no longer are guaranteed a cost-of-living adjustment, but would receive one only if board members vote to authorize an increase.

The change would make retirees' cost-of-living raises consistent with other state retirement systems and give the board more flexibility in managing the investment fund that pays for the retirement system, said Perdue spokesman Bert Brantley.

"This doesn't stop them from being able to give a cost-of-living adjustment. But if you can't make a decision based on the current health of the fund, you're just automatically giving this out every six months," Brantley said. "All the teachers currently paying into the system will be relying on this into the future. We want to be able to manage the fund to protect both (current and future retirees)."

But the fund is healthy, said Tim Callahan, director of public relations for PAGE, which opposes the change.

"This is one of the most actuarially and financially sound retirement systems in the nation," Callahan said.

"This is not money that comes out of the state treasury. This is money we've put in there," said Bill Sloan, executive director of the Georgia Retired Teachers Association.

The board approved the rule change 4-3 at a Sept. 24 meeting, but three members were absent, including University of Georgia banking and finance professor Ralph Steuer, a new member of the board.

The board has to vote again on the proposal at a Nov. 19 meeting in order for the rule to go into effect.

Steuer will attend that meeting and vote against the change, he said.

"I think if the votes were taken today and everyone was there, the governor's motion would not pass," he said.