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For Immediate Release 

July 23, 2014

Treasurer Cowell Releases Statement on Passage of Retirement Legislation HB 1195

Retirement Legislation will return 5-Year Retirement Vesting Period and Crack Down on Pension Spiking

Raleigh— North Carolina State Treasurer Janet Cowell made this statement following the North Carolina Senate’s final passage of legislation (House Bill 1195) returning the teacher and state employee retirement vesting period to five years and cracking down on pension spiking.

“I would like to thank the members of the General Assembly for their hard work and broad bipartisan support of this legislation,” said Treasurer Cowell. “In particular, Rep. Collins (R-Nash) and Rep. Ross (R-Alamance) deserve thanks for their leadership that made this bill possible. I also applaud Sen. Apodaca (R-Henderson) and Sen. Hise (R-Mitchell) for their work in guiding this bill through their chamber. A 10-year vesting period proved to be ineffective and inconsistent with human resource goals. A decade is too long for teachers and state employees to have to wait to be vested in their retirement system. By restoring the 5-Year vesting period, this legislation allows the state of North Carolina to be more competitive as an employer relative to other public and private retirement benefits. “

The legislation also allows the Department of State Treasurer to crack down on pension spiking, the practice of retirement system employers raising individuals’ pensions through large late-career pay raises. An outside review on fraud, waste and abuse showed that this problem is limited, but that the Department needed additional tools to control this unfair practice.   

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The North Carolina Retirement Systems, the formal name for the pension fund, is the eleventh largest public pension fund in the country. It provides retirement benefits and savings for more than 875,000 North Carolinians, including teachers, state employees, firefighters, police officers and other public workers. For more information, visit www.nctreasurer.com​

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