PERAC Memo #26 - 1998: EARLY INTERVENTION PROGRAM/H.5020

EARLY INTERVENTION PROGRAM/H.5020

Summary

This memo urges retirement boards to press their local legislators to pass H.5020, which would clarify and formalize the Early Intervention Program before its July 1, 1998 implementation deadline. Without this legislation, boards implementing the program using retirement trust funds could be committing a fiduciary breach, since trust assets cannot be used for active-employee benefits or unrelated activities. Boards are asked to have their members contact legislators urging favorable action, using the talking points provided, given the bill's expected review by the House Ways and Means Committee.

Full Text

PERAC MEMO #26/1998 M E M O R A N D U M TO:All Retirement Boards FROM:Robert F. Stalnaker, Executive Director RE:EARLY INTERVENTION PROGRAM/H.5020 DATE:June 15, 1998 As you know the implementation date of July 1, 1998 is rapidly approaching! As I informed you at the recent MACRS conference, I, along with members of my staff have been in constant contact with various members of the House and Senate relative to the adoption of H.5020. However, nothing has happened as of this date. The favorable support by the House and Senate leadership is imperative to an expeditious adoption of this legislation. Consequently, I am asking that you notify all of your board members to contact your respective legislative delegation and urge favorable action on H.5020. This measure is expected to be reported favorably out of the House Committee on Ways and Means within the next several days. Some general talking points are as follows: • Absent legislative action on H.5020, implementation date for the Early Intervention Program is July 1, 1998. • If local retirement boards are forced to implement this program, it could be a breach of board members fiduciary responsibility. A system may not expend trust fund money for active employee benefits or non-related retirement activities. • The net effect of passage of H.5020 will result in significant savings to the impacted employers as increased workplace safety, rehabilitation of injured employees and accommodation of injured workers reduces the costs associated with workers compensation and disability retirement.

M E M O R A N D U M - Page Two TO:All Retirement Boards FROM:Robert F. Stalnaker, Executive Director RE:EARLY INTERVENTION PROGRAM/H.5020 DATE:June 15, 1998 • Many cities and towns currently provide for early intervention for their employees through worker’s compensation programs or through collective bargaining agreements. • H.5020 is a product of the Early Intervention Task Force which was appointed pursuant to C.17 of the Acts of 1997 of the Massachusetts Legislature, which charged the Task Force to study and make recommendations to the Legislature by October 1, 1997. They completed that task and the unanimous agreement is embodied in H.5020. Now is the time for all of us to work together as a community to accomplish this hard fought goal.