The House of Delegates Monday gave preliminary approval to major reforms to the state's pension plan in the form of reduced retirement benefits for current and future state workers and an optional defined-contribution plan.
It also gave preliminary backing to Gov. Bob McDonnell's transportation bill.
Sponsored by Speaker of the House William J. Howell, R-Stafford, House Bill 1129 would, among other things, place a 3 percent cap on cost-of-living adjustments to retirement benefits for future and current state employees and teachers, except those within five years of retirement. The current cap is 5 percent or 6 percent, depending on the date of hire.
A House Appropriations subcommittee on Thursday stripped from the bill a McDonnell proposal to increase the state employee share of retirement costs from 5 percent to 6 percent of pay.
House Bill 1130, also sponsored by Howell, would create an optional defined-contribution plan for state employees, effective Jan. 1, 2014, under which workers would manage their own pension accounts. Currently, most retirees receive a defined-benefit pension, set entirely by the state.
Both pieces of legislation advanced to final reading Tuesday on voice votes with little debate.
The House also advanced to a final vote the governor's transportation funding proposal, which would, among other things, increase the amount of the state's sales tax dedicated to transportation. The bill sponsored by Del. L. Scott Lingamfelter, R-Prince William, would increase the allocation from 0.5 percent to 0.75 percent over the course of eight years.
That provision has been stripped from the Senate budget and replaced with a plan to raise revenue by indexing the gas tax. The budget conference between the House and Senate will determine which, if any, funding mechanism remains.
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