Sen. David Brinkley feels local governments should help fund part of the pension plan.
For decades, the State of Maryland paid for the teacher's pension plan. Now that the state is facing a $1-billion deficit, Gov. Martin O'Malley wants local governments to pay that $239-million bill.
County officials are against this and say if they have to pay that expense, it will result in teacher lay-offs and larger class sizes.
Senator David Brinkley, R, said the teacher pensions are funded by several different sources. "One is exactly what we paid them out; what benefits are they entitled to," he says. "The other one is certainly the investments on the fund, that helps contribute to the growth of the account. The third is contributions. Right now, the contributions are shared by the participants, those are the employees, and the state as a whole."
He went on to say the pension plan has been under-funded for nearly 6 years. "We have enhanced retirement benefits, that was done back in 2006. The pension funds took a tremendous hit when the stock markets turned around in 2008. So we went from about 90% funding down to 62% funding. Then last year, the Governor's proposal was for the participants to put in even more toward their retirement. Now the conversations are now requesting that the counties participate in it," he says.
Brinkley feels local governments should help to fund part of the pension plan. He wrote Senate Bill 836 that proposes the state paying a flat amount for every retiree and the counties would making up the difference.
Brinkley's bill would have Frederick County contributing $170-thousand a year to the pension plan and not $10-million annually like the Governor is suggesting.
Montgomery County school officials say they would have to cut 600 teachers if lawmakers in Annapolis approve the Governor's proposal.