Workers, retirees denounce proposed pension cuts

Workers, retirees denounce proposed pension cuts
Gov. John Kitzhaber speaks to a 2nd grade class at Hallman Elementary School in Salem, Ore., on Thursday, Sept. 26, 2013. Kitzhaber is pitching a combination of pension cuts and tax increase to increase funding for schools--a plan that will be considered next week in a special session of the Legislature. (AP Photo/Jonathan J. Cooper)

SALEM, Ore. (AP) — Public employees shouldn't have to give up pension benefits they earned from a career in public service to help increase funding for schools, members of the Public Employees Retirement System told Oregon lawmakers Thursday.

A joint committee of House and Senate members held its first public airing of the bills planned for a special session of the Legislature that begins Monday, although drafts of only two of the five proposed bills have been made public.

An agreement between Gov. John Kitzhaber and legislative leaders would cut pension costs for state and local governments by reducing a retiree's annual inflation increase. It also would generate new revenue for the state through higher taxes on some businesses and individuals, with much of the money going to schools.

In a bid to win Republican support, the deal also would prohibit cities and counties from regulating genetically modified crops.

Educators support increasing funds for public education, but it's unfair to do so by taking benefits promised to school employees, said Mark Perlman, a philosophy professor at Western Oregon University.

"You don't need to be an ethics professor to understand when you make a promise, you're morally obligated to fulfill that promise," Perlman told the committee.

Betty Crawford, a retired instructional assistant from Canby, said she sacrificed throughout her career for the pension she was promised.

"I stayed in my job because even though my take-home pay was small, it assured me a pension when I retired," Crawford said.

Lawmakers voted earlier this year to reduce the 2 percent annual inflation increases in retirement checks on a graduated scale. The proposal up Monday would reduce them even further. A retiree's first $60,000 in annual income would grow at 1.25 percent, and income above that level would grow at 0.15 percent.

Retirees earning less than $20,000 a year would get a supplemental payment to help blunt the negative impact.

A coalition of unions and PERS recipients is challenging the earlier cuts in the Oregon Supreme Court and has vowed to challenge the latest proposal.

Kitzhaber pitched the benefits in a visit to a Salem elementary school Thursday morning, where he read "Where the Wild Things Are" to Julie Wojcicki's first- and second-grade class at Hallman Elementary School.

"This isn't just trying to get some money in a budget," Kitzhaber said afterward. "These dollars are associated with real schools, real kids and their shot at a successful future."

Some opponents are critical of the tax plan, which would increase the bill for certain businesses while lowering it for others. It also would put restrictions on some tax exemptions for individuals and increase cigarette taxes by a dime per pack.

Environmental groups and organic farmers oppose the bill prohibiting local regulation of genetically modified foods, saying it has no place in a deal that was originally supposed to be about pensions and taxes.

Kitzhaber said he'd prefer the bill wasn't included, but it was needed to get Republican support for the other issues.

The governor also said he doesn't expect any other unrelated issues to be added, but if legislative leaders from both parties agreed something needed to be included, he "wouldn't object."

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