EagleTribune.com, North Andover, MA

Pension

July 30, 2007

The games they play: How state, workers manipulate pension system

'Bonus years'

Early retirement plans in 2001 and 2003 allowed state employees to add five years to their age or work history for purpose of their pension. For example, a 60-year-old employee with 30 years service could retire with the same pension as he would have earned at 65. For an employee earning a salary of $50,000, the bonus years would raise his pension from $30,000 a year to $37,500.



'Retirement Plus'

A 2000 retirement plan called "Retirement Plus" allowed long-term teachers to increase their pension by an extra 2 percent of their final average salary for each year they worked over 24 years | meaning a 12 percent boost for teachers who worked 30 years, for example. One trade-off was an increase in teacher pension contributions.



Buying time

Employees can "buy" credit for years they spent working at a variety of jobs outside the government or didn't pay into the pension system. For example, teachers can buy pension credit for time teaching at a private school or serving in the Peace Corps. Other state workers | including legislators | can get credit for years served as unpaid town officials. To buy time, employees pay what they would have paid if they had been working for the government at the time, plus interest.



One day equals one year

Elected officials are credited a full year's work if they work even a single day in a calendar year. Since legislators' terms don't expire until January, they get credit for a full year when they decide not to run for re-election or are defeated.



When it's good to be fired

Employees fired after 20 years, including lawmakers "fired" by voters, can start collecting their pensions before the usual age of 55. The same applies to employees whose positions are eliminated. A 2002 Commonwealth Magazine report found that a suspiciously high one-third of such pensions granted since 1990 went to employees who had passed the critical 20-year mark by less than a year.

Text Only | Photo Reprints
Latest News
Pension

NDN Video
Captain of Sunken SKorean Ferry Arrested Raw: Fire Destroys 3 N.J. Beachfront Homes Raw: Pope Presides Over Good Friday Mass Raw: Space X Launches to Space Station Superheroes Descend on Capitol Mall Man Charged in Kansas City Highway Shootings Obama Awards Navy Football Trophy Anti-semitic Leaflets Posted in Eastern Ukraine Raw: Magnitude-7.2 Earthquake Shakes Mexico City Ceremony at MIT Remembers One of Boston's Finest Raw: Students Hurt in Colo. School Bus Crash Raw: Church Tries for Record With Chalk Jesus Raw: Faithful Celebrate Good Friday Worldwide Deadly Avalanche Sweeps Slopes of Mount Everest Police Arrest Suspect in Highway Shootings Drought Concerns May Hurt Lake Tourism Vermont Goat Meat Gives Refugees Taste of Home Calif. Investigators Re-construct Fatal Bus Cras Mayor Rob Ford Launches Re-election Campaign Appellate Court Hears Okla. Gay Marriage Case
Photos of the Week