124th MAINE LEGISLATURE
		LD 830		LR 1482(01)
	An Act To Exclude Collectively Bargained Salary and Job Promotion Increases from the Earnable Compensation Limitation for Retirement Purposes
	Preliminary Fiscal Impact Statement for Original Bill
	Sponsor: Rep. Casavant of Biddeford
	Committee: Labor
	Fiscal Note Required: Yes
Preliminary Fiscal Impact Statement
Undetermined current biennium cost increase - General Fund
Fiscal Detail and Notes
	Excluding collectively bargained salary or wage increases and salary and wage increases that result from job promotions from the cap on earnable compensation used in the calculation of members' average final compensation would increase members' retirement benefit amounts and would result in increased costs to the retirement plans.  Since the cap on earnable compensation is factored into the actuarial valuation of the retirement plans and the determination of the funding requirement, an adjustment in the funding requirement will need to be made to reflect the expected increase in retirement benefits to be paid to retirees.
	An adjustment to fund the expected increase in retirement benefits will result in an unfunded liability being created.  Pursuant to the Constitution of Maine, Article IX, Section 18-A, unfunded liabilities may not be created except those that result from experience losses.  The Maine Public Employees Retirement System will require a one-time additional General Fund appropriation, the amount of which can not be determined at this time and will require the services of the Maine Public Employees Retirement System's actuary.