Under the Massachusetts' law, 104 local retirement boards have the option of voting for a 3% July '05 COLA rather than the lower 2.7% figure. Boards also have the option of voting for a zero COLA if payment of a COLA would "substantially impair the funding schedule" of their retirement system.

Last July's COLA of 3% was voted by all local Boards, with none voting for the CPI figure of the lesser 2.1%, or a zero COLA. In fact, over the last six years almost all boards voted for 3%, despite CPIs of less than 3% in five of those years. The few boards that voted for less than 3% in any given year were sharply criticized by our Association.

"I would expect that every board will again vote for 3% COLAs, rather than the lower 2.7% figure. We had some individual board members vote against 3% last year, but they were outvoted by the other members of their boards," said Association President Ralph White.

COLAs for the Commonwealth's two mega retirement systems - the State and Teachers' - are set by the Legislature and governor, with the same 3% limit as the local systems. The state budget is the vehicle for the approval of state and teacher retiree pensions. Governor Romney did not include a COLA in his first budget, the FY '04 budget, which he submitted in January 2003. The 3% figure was added to the budget by the House and Senate, which Romney eventually signed. In submitting his FY '05 budget, which took effect this last July, Romney did include a 3% COLA. We would expect that the Governor will include a 3% COLA in his FY '06 budget (July '05 COLA) which he will file this January.

"The Legislature has been continuously supportive of funding the COLA," said White. "Members will recall it was the Legislature, led by House Speaker Tom Finneran, that revived our near-moribund COLA in 1997 (Ch. 17), despite the strong opposition of the Massachusetts Municipal Association and then-Governor William Weld. Chapter 17 put local COLAs in the hands of local retirement boards, not city councils, town meetings, mayors or selectmen. It gave the boards unprecedented power."

Led by County Treasurer John McLellan, the Plymouth County Retirement Board was the first local Retirement Board to vote for a 3% COLA effective this July. The vote came at a meeting on November fifth.

McLellan, who is the Board chairman, praised fellow Board members Joe McDonough, John Sciara, Jim Harrington and John Duggan. "Their (Board) attitude was 'why wait'," said McLellan who usually vies with Medford to be the first board to vote for a COLA after the CPI figure is released each October by the Bureau of Labor Statistics. "Medford scooped us last year," said McLellan. "There was no way they were going to be first this year. Tom Curtis (Medford Chairman) is going to be disappointed, but if he hurries, Medford can be second."

"Between now and June all boards will be voting," said White. "We pretty much know which boards wait until the last minute. There are a few mayors who like to do a little board politicking. It's part of the process. But that's OK just as long as the boards get the job done."