# State pension reforms eyed



## policelaborlaw.com (Mar 7, 2006)

State pension reforms eyedBy REBECCA FATER, Sun Statehouse Bureau
Lowell Sun

BOSTON -- Benefit changes could be in store for the state's 88,000 public employees expecting a pension when they retire. 

Lawmakers unveiled a plan yesterday to reform the classification system that determines when employees are eligible for retirement, and what kind of benefits they will receive at that time. 

The system has not been changed since its creation in 1940, and has become confused and unfair, said Rep. Jay Kaufman, D-Lexington, House chair of the Joint Committee on Public Service, which requested the study. 

The current system places employees in one of four groups, based on job risk and estimated employee life span: 

Group 1: Mainly clerical and administrative workers, laborers and mechanics, and are required to work the longest to reach retirement; 

Group 2: Includes police officers for the University of Massachusetts, trial court employees and ambulance employees; 

Group 3: State police; 

Group 4: All local police officers and firefighters, corrections officers and more. They are required to work the fewest years to retirement. 

"There is no rhyme or reason left to the group classification system we have," Kaufman said. 

As a result, lawmakers said yesterday, they receive hundreds of petitions annually from individual employees and groups of employees, asking to be moved to another group. 

UMass campus police, for example, have requested to be moved from Group 2 to Group 4. Lawmakers yesterday said they don't know why UMass police were not grouped with local police. 

An eight-member commission, representing the business, education and political sectors, will study the problem and report back to lawmakers by June 15. 

The study is welcome news to the Massachusetts Organization of State Engineers and Scientists. The union has filed a bill to move its workers -- which include state Highway Department engineers -- from Group 1 to 2. 

"It's a dangerous job," said Bridget Quinn, a union representative who attended yesterday's press conference, adding that employees frequently work on busy highways with cars whizzing past. "You can get hurt." 

Changing the classification could affect the amount of money the state spends annually on pension payouts. The state will pay $1.27 billion this year to cover pension benefits and pay down the system's unfunded liability. 

If more employees are moved to higher groups, the state will owe more money in pensions sooner, and those employees receiving them will have paid into the system for fewer years than originally planned. 

Determining how the changes could affect the system financially is difficult at this point, said Patrick Charles, attorney for the Joint Committee on Public Service. While some employees may be reclassified into a higher group, others could be moved down, forcing them to pay into the system longer before retiring. 

Changes to the system could affect both currently enrolled employees as well as future hires, Charles said. 

Employees' pensions are determined, in part, through a percentage of the average of an employee's highest three years of salary. If the commission's discussion ventures into changing that structure -- and thereby lowering pensions -- the Massachusetts Teachers Association would be greatly concerned, said union representative Jack Flanagan, who also attended the press conference. Teachers are currently in Group 1, and are typically ineligible for retirement until age 65. They pay 11 percent of their salary into the pension system. "That will be a very controversial issue," he said. "We're opposed to that."


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