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Monday, March 7, 2011

Senate puts repealing DROP at top of agenda

The president pro tem of the Alabama Senate is pushing for the repeal of what he deemed a "luxury benefit plan," known as the Deferred Retirement Option Program or DROP.
Sen. Del Marsh, R-Anniston, said when lawmakers return to Montgomery on Tuesday that repealing DROP will be at the top of the Senate's agenda. He said people need to understand the difference between luxuries and necessities in tough economic times.
Marsh said repealing the program could save the state up to $70 million and said it has become a drain on the state's cash-strapped budgets.
"There is a lot of rhetoric out there regarding this bill, so I want to be clear - repealing this program will not cost anyone their job, it will not have a negative impact on anyone's retirement and it will not raise taxes on the people of Alabama," Marsh said. "However, if we fail to pass this bill, it could be catastrophic to essential programs - such as those that help children in need, provide medical assistance to seniors and serve as the lifeblood for people with disabilities."
"DROP is simply an added luxury that public employees enjoy, but the state does not have the resources to continue funding luxuries while cutting the budgets for the necessities. I believe the people of Alabama can understand that logic. It's the same logic that they follow when making financial decisions that impact their families - it's simply common sense budgeting."
DROP allows state and education employees who are 55 years old and have 25 years of service to receive salary and retirement benefits while continuing to work. The pro­gram was passed in the hope that it would discourage val­uable employees from taking early retirement.
Last week, House and Senate committee passed bills that would stop enrollment in DROP.
Republican Gov. Robert Bentley and Republicans in the Legislature have made repealing DROP a priority as they seek to balance the state's budgets.
Bentley pushed for repealing the DROP program in his State of the State address a week ago and said it has "overly taxed our retirement system."
"I applaud Governor Bentley's willingness to tackle these problems and make tough decisions as we work to cut out the fat so that we can save essential programs," Marsh said. "The Republican leadership is committed to heeding the governor's warning, repealing DROP and passing the savings on to relieve some of the strain on the Education Trust Fund and General Fund."
High school coaches and teachers are among those who have spoken out against repealing the bill.
Projections from the Legislative Fiscal Office and others put the savings to the state between $35 million and $70 million.

-- posted by Sebastian Kitchen

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