OPINION: Alaska state employees deserve to retire with security and dignity

Older Alaskans deserve to retire with independence, security and dignity. Yet Americans of all ages, including those in Alaska, are faced with a crisis where the goal of achieving an adequate and secure retirement is becoming increasingly difficult. That is why AARP Alaska supports HB 55 and HB 220 to give current and future public employees the option to participate in a defined benefit pension plan.

Our public servants — firefighters, teachers, police officers, social workers and many others — dedicate their lives to caring for Alaskans. They sacrifice daily to build stronger communities throughout Alaska, knowing that it means modest wages for hard work. We need to honor their commitment and take steps now to build a stronger retirement system that will care for them in their later years.

For most Americans, Social Security income is the foundation of financial security in retirement. However, many of Alaska’s public employees do not get to participate in Social Security so their reliance on the state’s retirement system for financial security is even greater.

Right now, most current public employees are only offered a defined-contribution plan. But two pieces of legislation, HB 55 and HB220, are moving through the Legislature to empower these public servants by providing them with the ability to choose to participate in a defined-benefit pension plan instead of defined contribution, which will provide them with a modest, stable, guaranteed, lifetime benefit in exchange for their service to our state.

A defined benefit pension plan is essential for providing retirement security to public employees and their families but it can also help Alaska overall to have a stronger future. Having the option of a defined benefit pension plan would help Alaska to attract and retain qualified teachers, public safety, and other public sector workers. It would provide for an orderly progression of personnel through the public workforce — hiring through retiring. And, these proposals would keep total compensation costs manageable for Alaska’s budget.

According to the National Institute on Retirement Security, defined benefit pension income remains an extremely significant source of retirement income for the middle class. In Alaska, where teachers and some other public employees do not get to participate in Social Security, the average pension benefit is between $1,898 and $2,913 per month. At the same time, retiree-defined benefit pension benefits support 8,778 jobs and $1.6 billion in economic output in Alaska.

Legislators should pass HB 55 and/or HB 220 for the good of Alaska communities and to honor a commitment to our public employees with a retirement that provides independence, security and dignity.

Madeline G. Holdorf, M.Ed., is the volunteer state president for AARP Alaska. Madeline continues her lifelong community activism pursuits with volunteer commitments to organizations including AARP, the Anchorage Senior Activity Center, SAGE Alaska, the Village to Village Network, and St. Mark Lutheran Church. She has been an AARP member since 1996.

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