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Ginette Rivard of Caribou is a past president of the Maine Service Employees Association, SEIU Local 1989; she retired after a career with the Maine Department of Health and Human Services. Penny Whitney-Asdourian of Scarborough is a retiree director for the Maine Service Employees Association, SEIU Local 1989; she retired after a career with the judicial branch of Maine state government.
The pensions of all retired state workers and public-school teachers in Maine are under threat once again.
A decade ago, in 2011, former Gov. Paul LePage and the 125th Maine Legislature eviscerated the public employee pensions of state workers and retirees to pay for income-tax breaks mostly benefiting the wealthy and corporations:
The retirement age was raised from 62 to 65 for state workers and teachers hired on or after July 1, 2006. Anyone hired since then who retires early faces a pension penalty of 6 percent a year.
Retiree pension cost of living adjustments were frozen for three years. This put retired state workers and teachers far behind the cost of living. We still haven’t caught up.
Future retiree pension cost of living (COLA) adjustments were capped at 3 percent and limited to the first $20,000 of pension income. Again, this put us behind the rising cost of living.
They made all of these cuts to our pensions over our fierce objections and with little regard for Maine’s retired state workers and teachers, and future retirees. Many state legislators, including both Republicans and Democrats, now recognize the 2011 cuts went too far, that it was wrong to cut the pensions of retirees to pay for new income-tax breaks for the wealthy and corporations.
Yet the monthly pension cuts imposed in 2011 continue today. Coupled with the biggest spike in the cost of living our nation has seen in 40 years, those pension cuts have made it harder and harder for retired public workers in Maine to make ends meet.
At issue are the public employee pensions of retired state workers and retired public school teachers participating in the Maine Public Employees Retirement System. Gov. Janet Mills and the 130th Maine Legislature have an obligation to protect our pensions from further decay. Many of us have struggled, and continue to struggle, to keep up with the rising cost of living.
Now is our opportunity to address the wrongs inflicted on us a decade ago. State revenue projections for 2022 are significantly higher than anticipated. The Legislature has an opportunity to address the financial harm we’ve endured. Passing LD 1227 for pension fairness and increasing the 2021 cost-of-living adjustment to 5.4 percent will strengthen our pensions and help us catch up with the cost of living. Without these actions, and at current trends, the purchasing power of Maine’s retired public employees is expected to shrink by around $500 per year and our purchasing power would continue to erode in the years ahead.
Let’s be clear: We’re talking about public employee pensions we paid into through contributions of 7.65 percent from every paycheck we earned while working. Most of us don’t receive Social Security; for those who do, federal laws known as the Social Security Offsets reduce or eliminate whatever Social Security we might be eligible for. For every one of us, our pension is our Social Security.
We’ve been working hard trying to make ends meet, but not receiving a full 5.4 percent cost of living adjustment will make it even more difficult to pay for medications, heating, housing and groceries. Instead of watching us continue to struggle, Maine’s elected leaders should fund the full 5.4 percent. Doing so wouldn’t put any of us ahead by even a penny; it would simply help us catch up. We’re that far behind. The 130th Legislature must allocate funding for this purpose through the supplemental budget in 2022.
With inflation hitting peak levels since 1982, if Gov. Mills and the Legislature don’t fully fund our pensions, thousands of retirees will be hit harder than ever. It’s time for action by Mills and the Legislature. They must address not just the rising inflation’s harm on us but also the damage inflicted in 2011 on our pensions. They must resolve to never again cut the pensions we earned in service to our fellow Maine citizens.