LEGISLATURE EXAMINES DISABILITY RETIREMENT CHANGES

JULY 24, 2009: The Legislature’s Joint Committee on Pubic Service is set to examine proposed changes to the state’s disability retirement law - changes that could have a deep impact on some Association members.

The Association has filed four separate bills dealing with various aspects of disability retirement. Three of the four bills will receive a public hearing before the Public Service Committee on Monday, July.

H2352 (Pension Conversation) and H2401 (Oversight) are uniquely suited to be acted on during the current legislative session, which runs until January 2011. Not only does neither bill carry a financial price, both would actually generate savings or even new revenue for the Commonwealth.

Since 1998, our Association has advocated for a limit on the length of time the Public Employee Retirement Administration Commission (PERAC) has to reexamine or evaluate disability retirees. The current law continues the review process indefinitely. Our Association proposes, in H2352, that the review process end once the retiree has been retired for longer than ten years.

Our second bill, H2352, allows for accidental (job related) disability retirees to convert their disability pension over to a regular superannuation pension. While most members will not avail themselves of this option, it is beneficial to disability retirees who have employment opportunities after having retired from public service. Disability retirees are restricted on the amount of outside income they can earn while also receiving a disability pension. The limit is based on the difference between ones pension and what their former job currently pays, plus an additional $5,000.

Finally, the Association has filed S1154, which would reform the calculation of ordinary disability pensions. This bill would establish a fairer retirement formula, based on similar disability benefits paid under Social Security.

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