6. Temporary increase in interest assumption to offset benefit improvements.

  7. A 2% reduction in interest credited to employes accounts (from 5% to 3%).

  8. Vesting rights revised. New employes are vested after 5 years of service instead of immediate vesting.

  9. Provides health insurance plan for annuitants who do not have a group health plan.

  10. Provides for a reduction in employer contributions.

527   The changes related to the accelerated recognition of long-term capital gains are the only changes in the bill that could possibly cause a three-fourths vote requirement. As part of the accelerated recognition of long-term capital gains, 600 million dollars is transferred from the transaction amortization account to either the fixed annuity reserve or the fixed employer accumulation reserve. In addition, the distribution formula of the Fixed Retirement Investment Trust is amended to provide an amount equal to the current income, plus 10% of the transaction amortization account. Currently the formula provides for an amount equal to the current income, plus 7%.

  The Chair points out that these changes alone do not provide for an increase in benefits to current annuitants, although current law provides a vehicle for a portion of these funds to be used by the Employe Trust Fund Board to provide dividend payments to annuitants. The Chair is of the opinion that Assembly Bill 462 in and of itself does not increase benefits for current annuitants or participants of the retirement fund who are no longer employed. Therefore, the Chair is of the opinion that Assembly Bill 462 does not require the extraordinary majority as required by Article IV, Section 26, of the Wisconsin Constitution. A simple majority only is required. The point of order is not well taken.

  Senator Fred A. Risser
President of the Senate

  [Intervening text omitted.] Senator Davis appealed the ruling of the chair.

  The question was: Shall the decision of the chair stand as the judgment of the senate? The ayes and noes were required and the vote was: [Display of roll call vote omitted; ayes-19, noes-14.] So the decision of the chair shall stand as the judgment of the senate.

[Point of order:]

  Senator Davis raised the point of order that a three-fourths majority was necessary for concurrence of Assembly Bill 462.

  The Chair [Pres. Risser] ruled the point of order not well taken.

[Point of order:]

  Senator Davis raised the point of order that Senate Bill 100 [relating to state finances and appropriations, constituting the general executive budget bill of the 1987 legislature, and making appropriations] did not pass as a three-fourths vote was necessary. The chair took the point of order under advisement.

  Ruling of the chair:

  The Senator from the 11th, Senator Davis, raised the point of order that Senate Bill 100 (the Executive Budget Bill) was not passed and that in accordance with the provisions of Article IV, Section 26 and Joint Rule 12 (2) (a) a three-fourths majority of all members elected (25) is required to pass the bill. The vote on passage was 19 Ayes - 14 Noes.

  Article IV, Section 26 reads as follows:

528   "The legislature shall never grant any extra compensation to any public officer, agent, servant or contractor, after the services shall have been rendered or the contract entered into; nor shall the compensation of any public officer be increased or diminished during his term of office except that when any increase or decrease provided by the legislature in the compensation of the justices of the supreme court or judges of any court of record shall become effective as to any such justice or judge, it shall be effective from such date as to each of such justices or judges. This section shall not apply to increased benefits for persons who have been or shall be granted benefits of any kind under a retirement system when such increased benefits are provided by a legislative act passed on a call of ayes and noes by a three-fourths vote of all the members elected to both houses of the legislature, which act shall provide for sufficient state funds to cover the costs of the increased benefits."

  Joint Rule 12 (2) (a) makes reference to the special vote requirement of Article IV, Section 26 of the constitution.

  The Chair would remind the membership that it is not the right of the Chair to rule on the constitutionality of a proposal. However, it is the responsibility of the Presiding Officer to enforce the rules of the body and insure compliance with established parliamentary practice to include those procedures required by the state constitution.

  The Senator from the 11th, Senator Davis, made reference to language on page 27 of senate amendment 47 to senate substitute amendment 1 to Senate Bill 100, relating to military service credit and transfer of $230,000,000 from the transaction amortization account of the fixed retirement investment trust to the appropriate reserve of the fixed retirement investment trust.

  The first point in reference to military credits does not have an impact on the benefits of those persons currently receiving an annuity. The amendment allows credit for military service to certain current employes. The second point, relating to the transfer of funds is an accounting transaction that once again does not provide an increase in benefits. The transfer of funds has an effective date of July 1, 1987. The date of occurrence of the transfer does not have an impact on the benefits of current annuitants. The chair is aware that a portion of the dollars being transferred will be used as a special investment dividend to provide an increase to persons currently receiving a supplemental benefit. Additional language in the amendment dictates that the amount of this dividend shall be equal to a supplemental benefit currently received by these annuitants.

  The resolution which inserted the current retirement language in Article IV, Section 26 was 1973 Senate Joint Resolution 15. The ratification question put to the voters was: Shall Section 26 of Article IV of the Constitution be amended to permit the legislature to increase the pensions of persons who have already retired under any public retirement system (such retirement benefits already may be granted to teachers), and to require the state to provide sufficient state funds to cover the costs of the increased benefits to all persons retired under a public retirement fund? In addition, the Joint Survey committee on Retirement Systems report on Senate Joint Resolution 15 spoke only to the legislature taking action to increase benefits for "retired" persons.

  The purpose of the new language was to enable the legislature to increase pensions for those persons who are retired, not to further restrict the legislature's authority to increase benefits for current employes. The Supreme Court recognized the legislature's authority to increase benefits for those who are currently employed in State ex. rel. Dudgeon v Levitan, 181 Wis. 326, 193 N.W. 499 (1923).

  The commonly accepted interpretation of the language contained in Article IV, Section 26, is that the special vote requirement applies when increased benefits are provided to persons who have been granted benefits or have left employment covered by the system and are eligible for benefits at a future date. The chair concurs with this interpretation of Article IV, Section 26 of the Constitution.

529   The chair has not located language in senate amendment 47 or senate substitute amendment 1 that would provide for an increase in benefits to any current annuitant or person who is no longer in employment covered by the system that is eligible for benefits in the future.

  Therefore, it is the opinion of the Chair that Article IV, Section 26 of the Constitution and Joint Rule 12 (2) (b) do not apply to passage of Senate Bill 100, and the point of order is not well taken.

  Senator Fred A. Risser
President of the Senate

  Senator Davis appealed the ruling of the chair. The question was: Shall the decision of the chair stand as the judgment of the senate? The ayes and noes were demanded .... [Display of roll call vote omitted; ayes-18, noes-14.] So the decision of the chair shall stand as the judgment of the senate.

  Point of order:

  Representative DeLong rose to the point of order that Assembly Bill 46 [relating to retroactive application of an employer election to apply an early normal retirement age under the state teachers retirement system] required a three-fourths vote of all elected members for passage under Article IV, Section 26 of the Wisconsin Constitution. Representative DeLong also rose to the point of order that Assembly Bill 46 was required to be referred to the Joint Committee on Finance under section 13.10 of the Wisconsin Statutes if the bill came under Article IV, Section 26 of the Wisconsin Constitution. The speaker took the point of order under advisement. [It appears that no ruling was given; no further action on bill.]

[Point of order:]

  Senator Davis raised the point of order that senate amendment 47 to senate substitute amendment 1 [to Senate Bill 100, relating to state finances and appropriations, constituting the general executive budget bill of the 1987 legislature, and making appropriations] was not properly before the senate.

  [Ruling of the chair:]

  The Senator from the 11th, Senator Davis, has raised the point of order that pursuant to Section 13.50 (6) (a) and Joint Rules 41 and 42 senate amendment 47 to senate substitute amendment 1 to Senate Bill 100 (the Executive Budget Bill) was required to be referred to the Joint Survey committee on Retirement Systems and have a report submitted.

530   Senate amendment 47 does contain provisions affecting the public retirement system.

  Section 13.50 (6) (a) directs that:

  "No bill or amendment thereto creating or modifying any system for, or making any provision for, the retirement of or payment of pensions to public officers or employes, shall be acted upon by the legislature until it has been referred to the joint survey committee on retirement systems and such committee has submitted a written report on the proposed bill."

  Joint Rule 41 (b) directs that:

  "Executive budget bills introduced under section 16.47 (1) of the statutes are exempt from the fiscal estimate requirement under par. (a) but shall, if they contain provisions affecting a public retirement fund or providing a tax exemption, be analyzed as to those provisions by the respective joint survey committee."

  Joint Rule 42 (b) reads in part as follows:

  "Bills affecting a public retirement fund shall be referred to the joint survey committee on retirement systems under section 13.50 of the statutes."

  The question is whether the language above requires each amendment to be referred to the Joint Survey committee on Retirement Systems and that a written report be submitted on each amendment.

  Several previous rulings of the chair have application in this case. On October 10, 1973 (1973 Senate Journal page 1691) in response to a point of order raised by Senator McKenna that a retirement bill was improperly before the senate for a number of reasons, one being that a report was not received on all amendments; the chair's ruling reads in part as follows:

  "there is no requirement for a report by the committee on amendments".

  On November 9, 1977 (1977 Senate Journal page 140) the chair ruled on a point of order raised by Senator Sensenbrenner that the Joint Survey committee on Retirement Systems was required to act on senate substitute amendments 1 and 2 to Special Session Senate Bill 2.

  The chair's ruling reads in part:

  "To read Senate Rule 54 as requiring such a report for each amendment and substitute amendment would be a perversion of the rules and present unlimited opportunity for delay."

  Section 13.50 (6) (b) reads as follows:

  "No bill or amendment thereto creating or modifying any system for the retirement of public employes shall be considered by either house until the written report required by par. (a) has been submitted to the chief clerk. Each such bill shall then be referred to a standing committee in the house in which introduced. The report of the joint survey committee shall be printed as an appendix to the bill and attached thereto as are amendments."

  Since the statutes require the bill to be referred to a standing committee after a report is submitted it is clear that the bill and amendments thereto are to be referred at the time of introduction and that rereferral of amendments after an initial report was submitted was not contemplated, nor is it required.

  Tax exemption bills which are handled by a statutory committee similar in structure and operation to the joint retirement committee, are required to have only a single report and rereferral upon introduction of an amendment is not required.

531   Joint Rules 41 and 42 relate to preparation of fiscal estimates. Joint Rule 41 (2) clearly states that:

  "Fiscal estimates are required on original bills only and not on substitute amendments or amendments."

  Therefore, it is clear to the chair that reports are required under these rules only for bills.

  It is therefore the opinion of the chair that a referral of senate amendment 47 to senate substitute amendment 1 to Senate Bill 100 to; and a report by, the Joint Survey committee on Retirement Systems, is not required and the point of order is not well taken.

  Senator Fred A. Risser
President of the Senate

  Point of order:

  Representative T. Thompson rose to the point of order that Assembly Bill 54 [relating to prohibiting investment of public retirement trust funds in certain investments relating to the Republic of South Africa] was not properly before the assembly under section 13.50 (6) (b) of the Wisconsin Statutes because the bill required a report from the Joint Survey Committee on Retirement Systems.

  The speaker [Loftus] ruled the point of order not well taken.

[Point of order:]

  Assembly Bill 54, relating to prohibiting investment of public retirement trust funds in certain investments relating to the Republic of South Africa.

  Read a second time.

532   The question was: Adoption of senate amendment 1?

  Senator Stitt raised the point of order that Assembly Bill 54 was not properly before the senate.

  The chair [Pres. Risser] ruled the point of order well taken.

  Point of order:

  Representative R. Travis rose to the point of order that Senate Bill 568 [relating to retirement benefits and funding those benefits] was not properly before the assembly because senate amendments 1 and 3 had been adopted by the senate in violation of section 13.50 of the Wisconsin Statutes. The amendments had not been referred to the Joint Survey Committee on Retirement System.

  The speaker [Loftus] ruled that, based on past precedents, Article IV, Section 8, of the Wisconsin Constitution and State ex rel. LaFollette vs. Stitt, each house of the legislature was the judge of its own procedures and he could not rule on the germaneness of senate amendments. The point of order was ruled not well taken.

  [Retirement amendment must be referred to joint survey committee:]