The Alabama Senate Tuesday approved a one-time bonus for state retirees after a brief but sharp debate between Democrats and Republicans over the size of the bonus offered.
The legislation, sponsored by Senate President Pro Tem Del Marsh, R-Anniston, would give the bonus to Employees Retirement System (ERS) retirees or their beneficiaries. Beneficiaries would receive a lump sum of $300, according to the Legislative Fiscal Office, while retirees would receive $2 for every month worked.
A retiree who worked 20 years would get a bonus of $480; a retiree who worked 30 years would receive a one-time bonus of $720. Retirees who worked less than six-and-one-quarter years for the state would receive a one-time bonus of $300.
The bonuses would be paid in October. Those whose Medicaid eligibility would be jeopardized by the bonus would not be eligible.
The Legislative Fiscal Office estimates the bonus would cost $13 million. It would be paid for by an increase in contributions made to ERS by state agencies. Marsh’s office said up to 40,000 retired state and local employees could receive bonuses.
A Senate committee approved a substitute that would have raised the bonus to $4 per month, but Marsh moved to lay that aside, saying on the floor he felt it was not fiscally responsible. Marsh said he would “love” to offer that much, he said he worked with the Alabama State Retired Employees’ Association on the number.
“I asked them to come to me with a formula there that was doable within our budget,” he said. “This is what they thought was a way to do it. It gives more to those who served the most.”
Sen. Roger Bedford, D-Russellville, fought to keep the $4 per month formula in the bill, saying a larger bonus was necessary for those who had served the state and not seen adjustments to their payments since 2008.
“What has been done is this supermajority has turned its back on retirees and given them next to nothing,” he said.
Bedford also proposed a $3 a month compromise, which was also defeated.
The bill goes to the House.
Last week, the Senate approved a $5.9 billion Education Trust Fund budget that includes a one percent bonus for education employees. Lawmakers have said they are concerned about fiscal forecasts for the year.
– posted by Brian Lyman