Dear ORP activists, union leaders and members from across this state,

On Friday afternoon (11/18/11), the Governor signed the Pension Bill with the Optional Retirement Plan (ORP) transfer provision intact. This is a huge victory for all of us and our union colleagues in the ORP. It has been an example of grassroots activism at its best. The oh-so-many calls, emails, and meetings with legislators - and the sharing of your ORP stories or the ORP experiences of your colleagues made a real difference. Legislators from both sides of the aisle heard you and empathized. The Commissioner heard you and responded. State House Leaders and the Governor heard you and have finally come together to provide so many of you with a much deserved opportunity to make an informed decision about your retirement. Thank you all for your perseverance and political engagement.

What’s next?

The ORP Ad Hoc Committee will be meeting in December to discuss what happens next.  That meeting will focus on issues related to the timelines set forth in this legislation, cost estimates for buyback, and the need for educational workshops on every campus across this Commonwealth once the State receives a favorable letter of ruling from the Internal Revenue Service on the legitimacy of this transfer. In the meantime, all union leaders should note that this is a one-time transfer opportunity for individuals based on the past flawed retirement orientation practices and ORP enrollment procedures at nearly all, if not all, of our campuses. Going forward we must do all we can to ensure that a consistent, comprehensive and correct orientation is in place for all new hires who are eligible to participate in either of the state's two retirement plans.

I know many of you and your ORP colleagues have many questions. Educational materials regarding this legislation, the process and related timelines, and the costs for buyback will be prepared for statewide distribution. Related informational workshops will be offered on every campus. This legislation does not go into effect until 90 days from the Governor's signing of this bill. I estimate it will be at least a year before the IRS letter of ruling is completed, sent and responded to, so there will be plenty of time for this information to be shared in the next few months.

ORP Legislation: A rough estimate of the events and related timelines:

• The Governor's signing of the Pension  bill (11/18/11)  
• Pension bill becomes law (90 days from yesterday -  approximately 2/18/12)  
• The State requests an IRS ruling on the Internal  Revenue Code Compliance of this ORP transfer initiative (up to 4 months  allowed to send request - 6/18/12)  
• The IRS responds, ideally within 6 months, but  this could take at least a year (6/18/13)  
• Upon receipt of a favorable IRS letter ruling, the  State notifies all eligible higher education employees of this  transfer opportunity (within 30 days).  
• Within 6 months (180 days) of receipt of this  notification, those wishing to transfer to the SERS  complete  and send an application to the State Retirement Board.  
• Within 30 days of receipt of an application to  transfer, the State Retirement Board notifies the applicant of the cost  of such transfer.  
• Within 180 days of receipt of this notice, the  applicant responds with payment for this transfer.
  

Note, that the IRS ruling does delay the implementation of the provisions of this Act, but it was the only way that the Legislature would move forward with this ORP legislation. It is important to acknowledge that because our ORP legislation was included in the Pension bill and did not have to go through a much more lengthy Legislative vetting process as a single bill, the legislative journey of our ORP bill and related enactment was completed almost a year earlier.

Thank you and Thanks-giving:

A sincere thanks to all of you, once more. I wish you all a beautiful Thanksgiving holiday. Please do some thanks-giving over that break, at least  to your own legislators, if you have not already done so. Also consider sending a note of thanks to those legislative leaders who made this ORP victory possible, as per my previous ORP email update. Note: I made a serious omission of one Senator on my previous list of those deserving of our thanks. Please also thank Senator Marc Pacheco - who sponsored our first ORP bill several years ago and whose office, since then, has worked closely with MTA and me to get this legislation to where it is today. Contact information for the Senator: Marc.Pacheco@masenate.gov or send him a written note to: State House, Room 312B, Boston, MA 02133

All the best,
Donnie

Diana (Donnie) McGee
MCCC Vice President & SAC Chair