Focus Now Turns To General Court

It is among a multitude of proposals, issued by the Commission, and sent to the Legislature, that touched upon a wide range of pension and insurance issues. A brief rundown of the study's major proposals can be found on page 6.

"From the very first meeting, I argued that improving the COLA had to be a Commission priority," states Association President Ralph White. "In fact, it became one of the few issues on which Commission members could all agree.

"While the Commission's work may have come to an end, the real challenge still lies before us with the Legislature. Along with the Commission's proposal, our bill (S1222), that raises the COLA base from $12,000 to $16,000 to start, are before the Joint Public Service Committee. The Commission's COLA base sets the bar a little higher, which is what I wanted from that panel.

"During the remainder of the (2009-2010) legislative session, our focus is on the General Court and enacting a law that allows for an increase in the COLA base. Despite the economic times, it's vital that we lay that foundation now."

Controversy and Opposition

While there was consensus on improving the COLA, other Commission proposals not only generated major controversy, but also Association opposition. While these proposals would not impact current retirees, they pose a significant threat to the basic pension and insurance benefits that future public retirees will receive.

Among them is the proposal that would increase the amount of reduction in one's pension if you retire before the normal retirement age for your group (i.e., age 65 for Group 1, 60 for Group 2 and 55 for Group 4). For example, if you are currently Group 1, have 30 years of service and retired at age 55, then your pension would be 45% of the average three-year earnings. However, under the Commission's proposal, you would be eligible for only 37.5% - more than a 16% reduction in actual pension dollars.

According to Association Legislative Liaison Shawn Duhamel, "We believe this proposal unfairly penalizes employees who made a career of public service, starting at a young age. If the rationale behind this proposal is to discourage employees from retiring early, then the proper approach should be to provide an incentive with a reasonable increase - not a decrease - in pension benefits if an employee decides to continue working."

Another controversial issue, that we touched upon in the last (September) Voice, proposes reducing an employer's (state or local governments) contribution to a retiree's health insurance based upon their years of service. "We also ran the numbers on this proposal and paid particular attention to local retirees who receive a modest pension after working 20 years for a town that contributes only 50% toward a premium," continued Duhamel. "It's possible that under this proposal, the town would contribute only 25% and the retiree pay 75%".

"We are strongly opposed to this concept," comments White. "And, these are just two of the report's proposals that we objected to.

"Despite our objections, they've been included in the Commission's report. But they are just that - proposals - and a long way from becoming law. So be assured our opposition will continue unabated."