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| Boards To Move Quickly On 3% COLA |
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JANUARY 2003
- Bristol County First To Vote - While the state and teacher 3% July 2003 pension COLAs will not be
final until the House, Senate and Governor reach final agreement on an
FY’04 state budget late this spring, we are moving forward in
encouraging local retirement boards – our 104 city, town, county,
district and authority boards – to take prompt action in voting for 3%
COLAs.Members
will recall that our Association’s 1997 legislation (Ch. 17) gave
five-member local boards the exclusive authority to vote on COLAs.
Originally Ch. 17 required boards to vote for a Consumer Price Index
(CPI) COLA, as used by Social Security, if it was less than 3%. A
subsequent amendment, which we sponsored, allowed boards the discretion
of voting for a higher 3% COLA.
Since the latest CPI figure, which will be paid to Social Security recipients this January, is 1.4%, members can understand why it is so important that boards take prompt action to commit by a binding vote of 3%. “Although local retirement systems have a 3% figure built into their long-range funding schedules, mayors and town managers will be seeking every possible penny to reduce the annual appropriations to these funding schedules,” said Association President Ralph White. “With pension fund investment earnings down over the past two years, new actuarial valuations could result in greater appropriations, tempting officials to press for lower COLAs.” Moving quickly on behalf of the higher figure, the Bristol County Retirement Board, which covers the retirees of 14 towns and the county itself, voted for 3% COLAs at its October meeting. “There was no point in waiting,” said Bristol County Retirement Board member Steve Rivard. “Even though the three percent is not effective until July, we wanted our retirees and survivors to know that we support them all the way.” Bristol County Treasurer Kevin Finnerty, the Board’s ex officio member, and members Bill Downey, Cynthia Sevigny and Ed Lima all agreed that the vote should be taken without haste. “It was simply the right thing to do,” said Finnerty. Several boards have initiated the process of voting for 3% COLAs. We expect the majority will have voted by the end of February. |
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