Alaska State Legislature
News from the House and Senate Majorities

Jerry Ritter, House Majority Press Secretary
State Capitol
Juneau, AK 99801
Phone: (907) 465-3804
web site: http://www.akrepublicans.org
Actuality line: 1-800-478-6540

Senate Passes Measure Allowing Legislative Contract Employees

Temporaries or Non-Permanent Employees Hiring Extended to Legislature

For Immediate Release April 15, 1998 Contact: Rep. Pete Kott at (907) 465-3764.

Juneau -- The Alaska Senate Saturday passed House Bill 467, which permits the Legislature to hire temporary or non-permanent employees using personal services contracts. Such terms eliminate the current Public Employees Retirement System (PERS) membership requirement.

"Because of language in the PERS statute, the Legislature does not have the ability to hire short-term employees and pay them an hourly wage without paying them retirement benefits," said Representative Pete Kott (R-Eagle River), Chairman of the House Rules Committee, which sponsors HB 467. "Most state agencies already have that ability. This usually results in a waste of time and money for everyone involved," Kott said.

For short-term employees, this requirement results in a needless cost to the Legislature and a tax disadvantage to the employee. For example, summer tour guides in the State Capitol are usually students earning money for school. They must be placed in the retirement system, which means money is deducted from their paychecks. They can get this money back when they leave employment but, because it was tax deferred, they not only have to pay the tax but a penalty for early withdrawal. The same circumstances apply to laborers who load and unload moving vans at the beginning and end of each session.

"This bill also brings temporary and non-permanent Legislative employees into line with Internal Revenue Service guidelines by clearly classifying them as employees under contract," Kott said. "However, the bill leaves intact language dealing with current Legislative employees. They will not be affected by the bill or by the solutions it offers," Kott said.

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