LOCALS DENIED OPPORTUNITY FOR HIGHER COLA BASE

SEPTEMBER 2008: Legislation, that would allow municipal officials to vote for a $16,000 COLA base for local government retirees, was rejected by a House/Senate budget conference committee this June.

Although both the House and Senate adopted language in the legislation section of the FY’09 state budget that would establish a new $16,000 COLA base for state and teachers retirees, an amendment drafted by our Association on behalf of our large membership of city, town and county retirees, was approved by the Senate, but was among the several amendments that failed to gain acceptance by the Conference Committee prior to the budget being sent to the governor. Association President Ralph White said that the conference committee rejection was a personal loss to him.

"In my involvement with our COLA law over the past 40 years, we have always been able to maintain the same level of benefits for members of all of our 106 retirement systems. While improvements in the COLA statute are instituted by the House and Senate on behalf of state and teacher retirees, our other 104 systems were also given the same opportunity by the Legislature on a local acceptance basis," said Association President Ralph White.

"For example, when we went to a $12,000 base in 1997 (Chapter 17), the statute was accepted by the governing bodies and retirement boards of all of the Commonwealth’s 104 local systems. For these systems and their retirees not to be included in this year’s COLA base statute goes against the policy of our Association. As president, it’s a personal loss to me and what we stand for."

Leading the opposition to the $16,000 COLA base was the powerful Mass. Municipal Association (MMA). "The MMA pulled out all stops on this one," said White. They had city and town officials believing this legislation was going to be a potential budget-buster, and the press was on a statewide crusade against the new base. We never previously saw as many editorials, including the Boston Globe, in opposition to one of our bills (see related story, page 3).

"We conducted one of our strongest lobby campaigns ever," White assured members. "We’ll be right back to it again next year with a new strategy and this time, we will win."

Commission Created

In a move that could help lead to a higher COLA base at the local level, the Legislature has created a special 15-member commission to complete an in-depth study of the pension benefits and report the funding options for the local COLA. The Association, which is the only retiree/employee organization granted a seat on the commission, will play a key role in the study.

The governor and legislative leadership from both parties will appoint the majority of the commission members. However, under the law passed in the outside sections of the FY’09 Budget, the chairman must be a private sector individual and not a member of a public retirement system. A complete report and list of the appointees will be included in our November edition of the Voice.

This commission could play an important role in the future of our public retirement systems, and the logical place to start is with increasing the local COLA base. Under the law, the Commission is set to hold its first meeting by September 1, 2008 and file a report no later than July 1, 2009.

Tags: