If you asked me, “What has been your most riveting read of the
session?” you might expect me to answer, “The McDonnell Indictment.” However, you would be wrong.
There are companion bills before the General Assembly, Senator
Reeves’ SB 385 and Delegate Morris’ HB 514, which we are calling the “Dead
Peasant” bills. The concept of these
bills is bizarre, and the fiscal impact statement (FIS) for these bills is the
most riveting read of the session.
The concept behind these bills is that an entity created by a
Virginia locality or by the Virginia Retirement System would borrow money and
use the money to purchase life insurance on employees. The example provided to me by a lobbyist supporting
the concept is that the employer would take out a $250,000 policy. When the employee died, the entity would get
$200,000 and the employee’s heirs would get $50,000. The collective value of the policies held by
the entities would offset the unfunded pension liability on the books of the
state and localities.
I asked someone at NEA who works on pension issues on the national
level for her reaction to the bill. Her
response was as follows:
The Virginia Retirement System is the state agency charged with
writing the FIS on these bills, and they seem to concur with NEA. VRS expressed, “Doubts as to whether
profiting from the deaths of VRS members is good public policy.” Ya think?
VRS pointed out that, “The American Council of Life Insurers
(ACLI) adopted a policy statement opposing government owned life insurance
intended to support state retirement funds.
The ACLI opposes these forms of investment as tantamount to ‘wagering on
human life.’”
Coincidentally, I was recently reading about the history of the
Mid-Lothian mines in Chesterfield County Virginia. These were the first coal mines in North
America. The mine owners insured the
lives of the slaves before sending into the mines. Most of the mining fatalities were slaves,
but fear not because their owners profited from their deaths. I guess this fits in with that “Virginia way”
folks around here keep talking about.
Could the actions of these slave owners have inspired these bills?
If this bill passes, we can probably anticipate an end to employee
wellness programs, and be careful about drinking the coffee in the teacher’s
lounge – poisoning the faculty could pay off big time.
For some reason, the VEA Legislative Committee decided to oppose
these bills. I guess they just don’t
have a death wish.