A Message from the President
April 23, 2012 - Legislative Update
We are now about half way through the current Legislative Session, and while there have been several controversial developments to date, I expect there will be even more to come in the weeks ahead.
Most of Governor Jindal’s K-12 reform legislation has been signed into law after moving rapidly through the Legislature. The result is sweeping changes in tenure and performance evaluations for K-12 teachers, along with some of the most aggressive school option laws in the nation, including provisions for expansion of charter schools and publicly-funded scholarships (vouchers) for students from low-performing public schools to attend private or charter schools.
At present, the Legislature is debating another of the Governor’s controversial proposals - public retirement system reform. These potential changes could affect many State employees and therefore are being watched with interest by many here at Southeastern. A number of changes recently have been made to the initial proposals. Summaries of proposed changes in retirement age and benefits in the legislation currently under consideration (Senate Bill 749) can be found on the TRSL and LASERS web sites.
Another of the proposed retirement changes (Senate Bill 52) would increase the employee contribution rate from 8% to 11%, with the exception of Optional Retirement Plan participants. This proposal has now been modified so the additional employee contributions would go to reduce the unfunded pension liability. While this may seem more acceptable to some, it does create another potential challenge as the original proposal instead dedicated the additional employee contributions to help balance next year’s State operating budget.
We continue to see and hear widespread indications that the Revenue Estimating Conference, the body responsible for determining official State revenue amounts, is expected to conclude there is an additional shortfall in the current fiscal year. As you know from my campus message of March 27, we are currently under a spending freeze by Executive Order of the Governor, which would seem to confirm the likelihood of the revenue shortfall. Of course, the closer we get to the June 30, fiscal year end, the more challenging any additional budget cut will be to implement.
We also continue to see and hear indications that the Revenue Estimating Conference will eventually determine a larger shortfall for next fiscal year than was originally anticipated when the Governor proposed his Executive Budget prior to the beginning of the Legislative Session.
It is unlikely we will know much detail about how the Legislature will deal with these budget issues until there is official action by the Revenue Estimating Conference. As always, I will keep the campus informed of new developments.