DES MOINES – Today two Iowa Statehouse leaders today expressed concern that the 2018 legislative session could bring sudden, unnecessary changes to Iowa’s pension system. The two said the changes would harm Iowa public employees and communities where they live.
“IPERS and Iowa’s other public pension plans are secure, strong, and sustainable. Some current legislative proposals to change IPERS could break the promise we have made to hard working Iowans since 1953,” said Treasurer Michael Fitzgerald. “The retirement contributions Iowa workers have made to these funds have been invested well and the benefits are reasonable. There is no need to make the type of changes Governor Reynolds and Senate Republicans are talking about.”
“Last year, Iowa made national news when state Republicans tore up long established collective bargaining laws in a little over a week,” said Senator Matt McCoy of Des Moines, a member of the Iowa Legislature’s Public Retirement Systems Committee and a nonvoting member of the IPERS Investment Board. “Legislation to blow up IPERS, Senate File 45, was introduced last year. It could be voted on during the 2018 session. Just last July, the Senate’s second ranking Republican, Senator Charles Schneider, brought in a right-wing think tank to tell Iowans to replace our successful, stable retirement systems like IPERS with more risky Wall Street-based schemes.”
Senate File 45 would begin to dismantle IPERS and other Iowa public retirement programs by preventing new Iowa workers from joining the programs on or after July 1, 2019. The existing retirement programs would be replaced by more risky defined contribution plans run by Wall Street traders instead of Iowa’s current non-profit managers.
In 2017, Governor Reynolds said several times that she supported a task force to propose changes to IPERS. She later dropped that idea but continued to express support for privatizing IPERS, including supporting the July meeting sponsored by Senator Schneider and the Reason Foundation
“Families, neighbors, and communities see the impact when money from IPERS is reinvested all throughout Iowa. These proposed changes, from the same legislators who earlier this year gutted collective bargaining rights for hardworking Iowans, could destabilize IPERS and negatively impact every community in Iowa,” said Treasurer Fitzgerald.
“Given how Republicans have been governing, every Iowan affected directly or indirectly by IPERS will be holding their breath until the 2018 session adjourns,” McCoy said.
On December 18, the Iowa Legislature’s “Public Retirement Systems Committee” will evaluates Iowa’s public retirement systems, including Iowa Public Employees’ Retirement System (IPERS), the Municipal Fire and Police Retirement System of Iowa (Iowa Code chapter 411), the Department of Public Safety Peace Officers’ Retirement System (PORS), and the Judicial Retirement System.
Links to news reports on Governor Reynolds’ support for changing Iowa’s public retirement systems:
Reynolds: Iowa task force will study IPERS changes
Mason City Globe Gazette 1/26/17
Iowa Lt. Gov. Kim Reynolds told a group in Scott County on Thursday a task force will be formed to study the possibility of long-term changes to IPERS, the retirement system for public employees in the state.
Branstad calls IPERS’ changes ‘prudent’ to shore up statewide pension fund
Des Moines Register, 3/27/17
Branstad and Lt. Gov. Kim Reynolds, who are both Republicans, have said that commitments already made to state and local government workers will be honored, but a state task force will review possible long-term changes to Iowa public employees’ pension programs. Among key changes that will be studied will be whether to offer a 401(k)-style plan.
Reynolds backs IPERS study, but task force is dropped
Des Moines Register, July 18, 2017 https://www.desmoinesregister.com/story/news/2017/07/18/reynolds-backs-ipers-study-but-task-force-dropped/487913001/
Reynolds noted that Sen. Charles Schneider, R-West Des Moines, is currently heading an interim committee’s study of Iowa’s public employees’ pension funds. The work is being conducted in cooperation with the Reason Foundation, a Los Angeles-based libertarian think tank.
“I support his efforts in doing that,” Reynolds said.
PDF of Senate File 45: