Approval process

Cost-of-living adjustments are granted to MTRS benefit recipients by vote of the Massachusetts Legislature. Every year, the Public Employee Retirement Administration Commission (PERAC) files with the Legislature a report detailing the increase or decrease in the Consumer Price Index (CPI). The Legislature then votes whether to grant a COLA based on the increase in the CPI or 3%, whichever is less.

Calculation

Currently, the retirement base on which a COLA is granted is $13,000. Accordingly, if the Legislature grants a 3% COLA effective July 1, a benefit recipient may have his or her allowance increased by a maximum of $390 per year, or $32.50 per month.

For your reference, the COLA for fiscal year 2014, effective July 1, 2013, is 3% on a base of $13,000.

Eligibility

Benefit recipients are eligible to receive their first COLA as follows:
RecipientWhen eligible to receive first COLATo be eligible to receive the FY2014 COLA, effective July 1, 2013...
RetireeAfter being retired for one full, July-through-June fiscal yearThe retiree must have retired on or before June 30, 2012
Survivor of Option C retireeAfter the retiree has been retired for one full, July-through-June fiscal yearThe Option C retiree must have retired on or before June 30, 2012
Survivor of a member who died in active serviceAfter one full, July-through-June fiscal year from the effective date of your survivor benefitThe member's date of death must have been on or before June 30, 2012
Accidental death benefit recipientAfter one full, July-through-June fiscal year from the effective date of your benefitYour benefit must have begun on or before June 30, 2012

Historical notes

Prior to 1976, COLAs were automatic. The percentage was based on the previous year’s consumer price index (CPI) increase. In 1975, the Legislature repealed this formula, effective 1976. Beginning in 1981, the provisions of Proposition 2-1/2 required the state to fund all local government COLA costs. Prior to 1981, the state funded state and teacher retirees’ COLAs, while local governments were required to fund city, town and county COLAs.

From 1998 to 2011, the base remained at $12,000, for a maximum annual increase of $360. In November 2011, pursuant to Chapter 176 of the Acts of 2011, the base increased to $13,000 for a maximum annual increase of $390.

MTRS COLA history
YearAllowed percentageRetirement benefit baseMaximum annual amountNotes
19716.00%of $6,000.00$360.00 
19724.30%of $6,000.00$258.00 
19733.30%of $6,000.00$198.00 
19746.20%of $6,000.00$372.00 
197511.00%of $6,000.00$660.00 
19765.00%of $6,000.00$300.00 
19775.00%of $6,000.00$300.00 
19786.50%of $6,000.00$390.00 
19795.00%of $6,000.00$300.00 
19806.00%of $6,000.00$360.00 
19813.00%of $7,000.00$210.00 
19823.00%of $7,000.00$210.00 
19833.00%of $7,000.00$210.00 
19844.00%of $7,000.00$280.00 
19854.00%of $8,000.00$320.00 
19864.00%of $9,000.00$360.00 
19873.00%of $9,000.00$270.00 
19884.00%of $9,000.00$360.00 
1989NO COLA   
1990
1991
19925.00%of $9,000.00$450.00effective 01/01/1992
1993NO COLA   
19943.00%of $9,000.00$270.00 
1995NO COLA   
19963.00%of $9,000.00$270.00effective 11/01/1996
1997NO COLA   
19982.10%of $12,000.00$252.00 
19993.00%of $12,000.00$360.00 
20003.00%of $12,000.00$360.00 
20013.00%of $12,000.00$360.00 
20023.00%of $12,000.00$360.00 
20033.00%of $12,000.00$360.00 
20043.00%of $12,000.00$360.00 
20053.00%of $12,000.00$360.00 
20063.00%of $12,000.00$360.00 
20073.00%of $12,000.00$360.00 
20083.00%of $12,000.00$360.00 
20093.00%of $12,000.00$360.00 
20103.00%of $12,000.00$360.00 
20113.00%of $12,000.00$360.00 
20123.00%of $13,000.00$390.00 
20133.00%of $13,000.00$390.00 

*Unless otherwise noted, all COLAs are effective on a fiscal year basis (e.g., the COLA listed as "2013," above, is effective for the fiscal year beginning July 1, 2013).