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A week after passing comprehensive legislation to overhaul
the state transportation system, the Senate continued to push its
reform agenda with unanimous approval of a bill that will tie off
loopholes in current pension laws to end abuses and save taxpayer
money.
The Senate’s actions today are aimed at fixing the system
and restoring the public’s trust in government. While most public
employees play by the rules, there are still too many who cheat the
system by taking advantage of ambiguities in the law. That’s going to
change with this bill
The state’s pension system is an important benefit for
state workers who chose generally low-paying careers in public service
over the private sector. The average pension for Massachusetts public employees is
approximately $24,000 a year. There are examples, however, of individuals
who exploit loopholes to increase pension payments at a high cost to
the state.
The Senate legislation is just the beginning of important
fixes to state pension laws. The bill also directs the
currently-established Blue Ribbon Commission on Pension Reform to
review broader issues within the system, such as capping large pension
payments, and make comprehensive reform recommendations to the
Legislature by September 1, 2009.
The Senate legislation contains seven common-sense reforms
of our public pension system:
·
Re-defines “regular compensation”
to exclude housing allowances, use of motor vehicle and travel;
·
Removes the “one day, one year”
provision that allows elected officials to claim an entire year of credible
service for working one day in a calendar year;
·
Eliminates the ability of municipal
officials to receive pension credit for service in an unpaid position;
·
Reforms the current accidental
disability retirement benefit for individuals who are injured while
temporarily filling in for their supervisor;
·
Removes a provision that allows
elected officials to claim a “termination allowance” based on the
failure to be nominated or re-elected;
·
Aligns MBTA employee pension with
the state system. Eliminates the 23 years and out for future T
employees. (This reform was also included in the Senate transportation
reform bill passed last week.);
·
Reforms dual-service pensions so
that an individual cannot combine the compensation from two positions
to artificially increase one’s pension. An individual who is a member
of two or more systems will receive benefits as if retiring separately
from each system.
The Senate pension reform package was strengthened today
by several amendments that were approved on the Senate floor, including
one that prevents local and state employees as of January 1, 2010 who
make less than $5,000 from receiving pension credit. Another raises the
vesting years for future elected officials from six to 10 years,
bringing them on par with all other public employees.
The bill now goes to the House of Representatives for
further action.
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