To the Honorable Senate and House of Representatives:
Pursuant to Article LVI, as amended by Article XC, Section 3 of the Amendments to the Constitution of the Commonwealth of Massachusetts, I am returning to you for amendment Sections 11 and 12 of House Bill No. 4900, "An Act Making Appropriations for the Fiscal Year 2009 for the Maintenance of the Departments, Boards, Commissions, Institutions and Certain Activities of the Commonwealth, for Interest, Sinking Fund and Serial Bond Requirements and for Certain Permanent Improvements."
Section 12 increases the base for determining cost-of-living increases for state and teacher retirees from $12,000 to $16,000, and Section 11 extends the retirement system funding schedule by three years to accommodate this cost. In general, I recognize the need of our retirees, most of whom are on limited fixed incomes, for this very modest cost-of-living adjustment. This need is less critical, however, for those receiving larger pension payments. Considering the existing size of our unfunded retirement liability, therefore, I recommend limiting this adjustment to those retirees whose annual pension payments are below $40,000.
For these reasons, I recommend that Sections 11 and 12 be amended by striking out their text and inserting in place thereof the following 3 sections:-
SECTION 11. Section 22C of chapter 32 of the General Laws, as appearing in the 2006 Official Edition, is hereby amended by striking out, in line 29, the words "June thirtieth, two thousand and 23" and inserting in place thereof the following words:- June 30, 2026.
SECTION 12. Section 102 of said chapter 32, as so appearing, is hereby amended by striking out, in lines 32, 36 and 43, the figure "$12,000" and inserting in place thereof, in each instance, the following figure:- $16,000.
SECTION 12A. Subsection (b) of said section 102 of said chapter 32, as so appearing, is hereby further amended by adding the following sentence:- In any case where the former employee, spouse, or other beneficiary is receiving an annual retirement allowance, pension or annuity which is $40,000 or more exclusive of additional annuity obtained by special purchase under paragraph (g) of subdivision (1) of section 22 or any similar law, the sum of $16,000 referred to in this subsection shall be reduced to $12,000.
Deval L. Patrick
This information provided by the Executive Office of Administration and Finance.