A Look At The City Of Lynn Pensions

NOV 2006 - Comparable To State Retirees - Because our Association includes a large number of retired
municipal employees and survivors within our membership, from time-to-time we
focus on the pension demographics of individual retirement systems.

This month we are looking at the Lynn Retirement System and
the latest actuarial study as prepared by Jim Lamenzo, actuary of the Public
Employee Retirement Administration Commission (PERAC).

Looking back at the Year 2000 study, the average salary for Lynn’s
1,783 employees was $36,979. In the 2006 study there are now 1,460 employees
with an average salary of $44,825. There was a 22% decrease in the number of
employees and a 21% increase in the average salary over the six-year period.

In Year 2000, there were 1,221 retirees and survivors on the
Lynn pension roles. Six years
later, 2006, finds Lynn with 1,285
pensioners, a scant increase of less than 5%. Lynn’s
retirees received an average pension of $14,624 in Year 2000. This year, the
average pension is $20,504, an increase of 40%.

These percentage increases, salary dollars vs. increases in
pension dollars, were similar to studies we have made of other communities.
However, the loss of employees was not proportionate to the increase in the
number of retirees in Lynn.

Gary Brenner, director of the Lynn Retirement Board,
explained that the city closed two large city-owned nursing homes during that
period.  “Many of these employees were
not eligible to retire and left to work in private nursing homes or elsewhere,”
he said. Also, due to layoffs or early retirements in many departments, there
was a decline in the number of employees. “Jobs just weren’t being filled when
people left,” he said.

By way of comparison, pensions in cash-starved Lynn
are on the high side when compared to similar cities in eastern Mass, most of
which are in the $18,000 range. On the other hand, affluent Marblehead,
a neighboring town with its own retirement system, has an average pension of
$15,766 and an average employee salary of $38,273.

Data on municipal pensions of retirees do not include
teachers. Teachers, with the exception of Boston,
are members of the statewide Teachers’ Retirement System. The most recent data
on the Teachers’ System (2005) showed an average pension of $29,182. The
average for state retirees (2005) was $20,513.

In Lynn, like
every other retirement system, there is a steady increase in the number of
older retirees. In 2000 there were 122 Lynn
retirees age 85-100. In 2006, there are 150.

Leo Gaudet: Lynn Retiree

Longtime Association member Leo Gaudet, at age 92, falls
into the “older” category.

Gaudet has lived his entire life on Williams
Avenue in East Lynn. He was
born at 119 Williams Ave,
grew up at 72 Williams Ave,
and after four tough years fighting in the Pacific during World War II, bought
a house with a GI loan at 170 Williams Ave,
where he still lives.

Life was rugged in his boyhood. “I was one of nine children.
There was no heat except for the kitchen stove, but most families faced the
same difficulties,” he said.

He worked for the Lynn DPW until age 62 when he retired
because of a heart problem. “I loved my job but had to stop working.” With his
children now grown and wife Virginia recently died, he lives alone.

“With Lynn being the shoe manufacturing center of the world
and the General Electric Plant employing seven or eight thousand workers Lynn
was a booming city compared to what it is now,” he recalled.

Leo’s pension is now around $14,000. “The COLAs have helped
and I’m not complaining,” he said. He supplements his income through an earlier
savings plan and “gets by OK.” Leo’s father lived to be 100.

Says Leo, “I was born in Lynn
and will die in Lynn. People
criticize this city, but it’s my city and I never wanted to live anywhere
else.”