LD 1480 LR 1148(01)
An Act To Modify Retirement Plans for Fire Investigators and Sergeants
Preliminary Fiscal Impact Statement for Original Bill
Sponsor: Rep. Harrington of Sanford
Committee: Labor and Housing
Fiscal Note Required: Yes
Preliminary Fiscal Impact Statement
FY 2019-20 FY 2020-21 Projections  FY 2021-22 Projections  FY 2022-23
Net Cost (Savings)
General Fund $131,521 $6,652 $6,885 $7,126
General Fund $131,521 $6,652 $6,885 $7,126
Other Special Revenue Funds $981,519 $6,652 $6,885 $7,126
Fiscal Detail and Notes
This legislation moves state fire marshal investigators, senior state fire marshal investigators and state fire marshal sergeant positions for the 1998 Special Plan to a 20-year, no-age plan.  Since there is no open 20-year, no-age retirement plan at the current time, a new plan will need to be created.
Creating a new 20-year, no-age retirement plan for certain positions within the State Fire Marshal's Office will increase the unfunded liability of the Maine Public Employees Retirement System (MainePERS) by approximately $1.1 million.  Pursuant to the Constitution of Maine, Article IX, Section 18-A, unfunded liabilities may not be created except those that result from experience losses. An analysis of the positions that would be eligible for the new plan indicates that approximately 11.4% are funded with General Fund monies and 88.6% are funded with Other Special Revenue Funds.  Based on these percentages, the Retirement Allowance Fund within MainePERS will require a one-time General Fund appropriation of $125,001 and a one-time Other Special Revenue Funds allocation of $974,999 in fiscal year 2019-20 for the unfunded liability.  The State Fire Marshal's Office program, Other Special Revenue Account currently has sufficient funds to cover the one-time cost.
This proposal will also increase the normal cost component of the employer retirement rate, resulting in increased employer contributions to the Maine Public Employees Retirement System for these employees from 5.9% to 10.83% for each year of the 2020-2021 biennium.  The Retirement allowance fund will require General Fund appropriations of $6,520 and $6,652 in fiscal years 2019-20 and 2020-21, respectively, for the additional cost.  MainePERS is unable to determine the employer contribution rate for the unfunded actuarial liability at this time.