Members of the Public Pension Network (PPN), a Washington, D.C.-based coalition of public employer and employee groups, reported at an August meeting that they have learned that mandatory coverage of state and local workers still could be a part of the Social Security proposal from House Republicans.

The House is expected to take up Social Security reform legislation in September and Republican lawmakers have given mixed signals on mandatory coverage. Ways and Means Social Security Subcommittee Chairman Jim McCrery, R-La., for example, said at a June 9 hearing that, "The question that keeps coming back to me is why shouldn't everybody contribute to a system like Social Security that is supposed to be a universal system," but he told PPN members two weeks later that mandatory coverage is "something we're looking at, but I don't think we'll do anything with it. But I can't make any promises."

PPN members indicated at their August meeting that GOP sources say they have not ruled out including forced coverage of all state and local workers in their Social Security plan. These reports came just a few weeks after a PPN meeting with an aide to Speaker of the House Dennis Hastert, R-Ill., in which the aide said there has been no indication that mandatory coverage would be included in the GOP bill.

The bill that Republicans are expected to use as a starting point in September - the Growing Real Ownership for Workers (GROW) Act - does not include mandatory coverage, but that could change as it moves through the House.

Mandatory coverage would cost public employers and employees in jurisdictions not now covered by the program $44 billion over the first five years, an expense that could lead to cuts in retirement benefits for public employees, financial uncertainty in public pension funds and pressure on state and local governments to raise taxes or cut public services, while adding just two years to the projected solvency of Social Security, according to a July 2005 Segal Company report.