In February Governor Evers released the 2023-2025 executive state budget, a proposal for how the state should manage expenses for the next two years. The budget is introduced as separate—yet identical—legislation (bills) in the Senate and the Assembly. 2023 Assembly Bill 43 and 2023 Senate Bill 70 are currently before the Joint Committee on Finance. The JCF has spent the last few months reviewing the proposed budget and will continue to review and make changes over the next few weeks.
After JCF makes its recommended changes, the budget goes to the Assembly and the Senate for further review and, ultimately, back to the governor for signature. The governor can also veto the bill in whole or in part.
The proposed budget currently contains a few changes that affect the benefit programs administered by the Department of Employee Trust Funds. Here is a brief description:
- Modernization-Related Ongoing IT Expenses. Provides seven positions and funding to support our modernization effort related to ETF’s Insurance Administration System, data management and consulting/contractor costs related to replacing outdated legacy IT systems. The budget did not provide funding for the Pension Administration System.
- Critical Customer Service Functions. Provides seven positions to maintain basic, critical customer service functions related to significant increases in the number of Wisconsin Retirement System members and employers.
- Financial and Actuarial Compliance and Reporting. Provides two positions to ensure ETF can fulfill its actuarial and accounting responsibilities related to actuarial valuations, financial reporting, and the proper implementation of federal accounting requirements.
- Return-to-Work Laws. Provides that WRS employers may rehire an annuitant if: (a) at least 30 days have passed since the employee left employment with a WRS employer; (b) at the time of retirement, the employee does not have an agreement with any WRS employer to return to employment; and (c) upon returning to work, the employee elects to not become a participating employee and to continue receiving his or her annuity.
In addition to the above provisions, the budget includes additional resource and statutory changes relating to health insurance and retirement benefits.
ETF needs to be sure that it can provide its members with dependable service. The resources included in the budget are critical to ensuring retirement and death benefits are calculated accurately, providing timely annuity payments, providing expert benefits guidance, and protecting personal information.
Enacted Legislation
2023 Wisconsin Act 4 classifies county jailers as Protective category participants under the WRS without a requirement that their principal duties involve active law enforcement. It requires county jailers who are currently employed by a county that does not classify county jailers as Protective participants and who choose to become Protective participants under this law to pay the employer share on the higher WRS contribution, as well as the duty disability premium, which is currently an employer cost. 2023 Act 4 provides county jailers an irrevocable choice to opt out of being classified as a Protective participant. Additionally, the law provides that county employers who currently classify their jailers as Protective category participants can continue to pay the employer cost for current and future employees.
Other Legislative Proposals
2023 SB 9 and 2023 AB 18 eliminate the annuity suspension requirement for teachers of school districts who return-to-work as a substitute teacher for a school district and work more than two-thirds of full time and reduce the break-in-service requirement for teachers of school districts from 75 days to 30 days. The changes apply to retired teachers who are hired between the effective date of the bill and August 1, 2026.