The Honorable Michael D. Brady, Senate Chair
The Honorable Jerald A. Parisella, House Chair
Joint Committee on Public Service
State House, Boston

Dear Senator Brady, Representative Parisella, and Members of the Committee,

On behalf of the cities and towns of the Commonwealth, the Massachusetts Municipal Association appreciates the opportunity to submit the following comments on bills before the Committee that were heard on May 29. We have concerns regarding a number of bills that would either credit employees for service or include new members under the governing statute for public employee retirement, M.G.L. Chapter 32. We greatly appreciate the Committee’s consideration of the local government position regarding these policy matters concerning public employee pensions.

The MMA opposes the following bills on the Committee’s agenda for the May 29 public hearing for the reasons set forth below:

• H. 2160, An Act relative to the creditable service for local municipal police and the Massachusetts State Police (Representative James Arciero)

• H. 2180, An Act relative to creditable service for school business administrators (Representative Gerard Cassidy, and others)

• H. 2195, An Act relative to the retirement system (Representative Tackey Chan)

• H. 2206, An Act requiring creditable service for Massachusetts National Guard service (Representative Claire Cronin)

• H. 2225, An Act relative to creditable service and notice by certified mail (Representative David DeCoste)

• H. 2267, An Act relative to the Massachusetts teacher retirement system (Representative Susan Williams Gifford)

• H. 2311, An Act relative to creditable service for school nurses (Representative Kathleen LaNatra)

• H. 2332, An Act relative to creditable service for VISTA volunteers (Representative David Muradian, Jr.)

• H. 2339, An Act clarifying call firefighter rights (Representative Harold Naughton, Representative Kimberly Ferguson, and others)

• H. 2342, An Act authorizing certain public employees’ creditable retirement service (Representative James O’Day)

• H. 2351, An Act relative to teachers’ retirement credits for parochial schools (Representative Angelo Puppolo, Jr.)

• S. 1557, An Act relative to the active service buy-back program for firefighters and police officers (Senator Jason Lewis)

• S. 1582, An Act relative to non-public school service (Senator Michael Rush)

• S. 1593, An Act relative to the retirement options of certain educational personnel (Senator Walter Timilty)

Without an actuarial analysis of how this legislation would impact municipal pension liability, which is currently double that of the state, the MMA cannot properly analyze the substantive issues in these bills. Adding members to the retirement system or awarding members more creditable service creates larger future costs in the pension system that would impact municipalities as well as the state. Moreover, increasing pension benefits would directly affect municipal liability for other post-employment benefits (OPEB), like health care. If an employee is credited with service time and reaches the 10-year mark to vest in the pension system, the employee likely also qualifies for retiree health insurance. The impact of this legislation, therefore, is not only to pension costs, but also to costs associated with retiree health insurance coverage, and ultimately to taxpayers. This increases the additional impact on these systems significantly.

Without an actuarial cost analysis and a thorough discussion about the cumulative effect of legislation from session to session that adds to pension and OPEB liability, we believe it would not be prudent for the Committee to release these bills. We respectfully ask you not to report these bills out of Committee.

If you have any questions or need additional information, please do not hesitate to contact me or Senior Legislative Analyst Lisa Adams at 617-426-7272 at any time.

Thank you,

Geoffrey C. Beckwith
Executive Director & CEO