HARRISBURG — The House State Government Committee today sent to the full House legislation giving older state employee and teacher retirees a cost-of-living (COLA) increase over the objection of Republicans as the bills don’t identify where the funding will come from, said Rep. Brad Roae (R-Crawford/Erie), Republican chair of the committee.
“Pennsylvania taxpayers cannot afford the $1 billion price tag to give a COLA to some Public School Employees’ Retirement System (PSERS) and State Employees’ Retirement System (SERS) retirees,” Roae said. “There is already a $60 billion unfunded pension liability which means that the PSERS and SERS pensions only have about 60 cents for every $1 in owed pension benefits. School property tax increases are the primary source of funding that will be used to increase how much school districts have to pay in order to fund the PSERS COLA. Pennsylvania has among the most insolvent public pension plans in the country, and our taxpayers are already paying a lot of money to prop them up and a COLA would only add to that burden.”
House Bill 1415
would give a COLA to PSERS and SERS retirees who retired prior to July 1, 2001. The percentage of the COLA would be between 10% and 20% based on their retirement date with older retirees receiving a higher percentage.
House Bill 1416
is identical to House Bill 1415 but increases the percentages to between 15% and 24.5%.
“Many state and school retirees who retired 20 or more years ago express concern that their pensions are not very large and have lost buying power due to inflation,” Roae added. “But 99% of them retired before ago 65, their pensions are exempt from the Pennsylvania state income tax, and 99% of them also get a monthly Social Security benefit. By comparison the vast majority of retirees from the private sector worked into their 60s or 70s, they do not have any pensions at all, and if they work part time to supplement their Social Security, they have to pay state income tax on that money. It’s really hard to ask them to pay higher school property taxes to fund a COLA for retired school employees.”
The 6th Legislative District includes the city of Meadville; Beaver, Conneaut, East Fairfield, East Fallowfield, East Mead, Fairfield, Greenwood, Hayfield, North Shenango, Pine, Randolph, Sadsbury, South Shenango, Spring, Summerhill, Summit, Union, Vernon, Wayne, West Fallowfield, West Mead and West Shenango townships; and Cochranton, Conneaut Lake, Conneautville, Linesville and Springboro boroughs in Crawford County and Conneaut, Elk Creek and Springfield townships and Albion and Cranesville boroughs in Erie County.
Representative Brad Roae
Pennsylvania House of Representatives
Media Contact: Tracy Polovick