I am once again pleased to report, especially after last year's disaster that we enjoyed a well-attended holiday luncheon on Wednesday December 8th at the Edmonds yacht Club. I want to thank all who attended. We had the largest turnout that we have had in recent years. The weather was good, and the Yacht Club was decorated nicely for the holidays. The food was well prepared and served hot by the very courteous staff of Clipper Cove Catering. I was very pleased with Cheryl at Clipper Cove and her excellent staff. From my first phone call I found Clipper Cove to be very upbeat and professional in responding to our needs. Every detail was completed beyond my expectation from preparation of the food, setting the tables, the serving of the food to the final cleanup. If you are ever in need of a catering service I would suggest you contact Clipper Cove Catering in Everett at 425-317-9858.
The State Legislature is scheduled to reconvene on January 10, 2011. Unfortunately, because this is an odd numbered year the Legislature is scheduled for a long 105 day session. Due to the present economic situation and the projected revenue shortfall most of the attention will be directed to the budget. Very few bills if any with any cost or fiscal note will be passed. Instead of considering new programs or increased funding to existing programs they will be looking everywhere to make cuts. Due to the longer session they will have ample time to consider all areas of state government to make the necessary reductions.
Judging from the recent one day special session and from the Governor's recent remarks there will be no sacred cows. We will have to be very vigilant in monitoring the various hearings and committee activities in an attempt to respond to any negative thoughts or discussions regarding any fire service pension funds or retirement benefits. The Governor's recent comments regarding retirement benefits reductions that appeared in all the major newspapers generated a lot of concern, e-mails and phone calls. I went to Olympia the next day to determine if my interpretation of her remarks was correct. I then contacted our board and other retiree organizations and put the following explanation on our website to explain that at this point no fire service retirement plans would be affected. The Governor's remarks were not meant to impact RCW 41.26, the LEOFF Law. The COLA repeal that she was referring to will impact the PERS and TERS Retirement Systems. These benefits were deemed to be non-contractual when given. This particular repeal if carried out will not challenge or impact the Bakenhus Decision in regards to contractual protection. This however puts us on notice that we will have to be very diligent during the coming (long) legislative session to head off any thought or discussion that will have a negative impact on the LEOFF I Fund or Retirement System. The following information was released December 16, 2010:
As part of her 2011-13 biennial budget proposal, Governor Gregoire has introduced a number of changes to the state's pension system. They primarily affect members of Plans 1, new hires, and higher education retirement plans.
Plans 1 Uniform COLA:
When the original Public Employees Retirement System (PERS) and Teachers Retirement System (TERS) were set up, there was no mechanism in place for cost-of living (COLAs). Annual increases were periodically provided by the State Legislature.
In 1995, the Legislature passed an annual benefit called the Uniform COLA. The Uniform COLA is a fixed dollar amount multiplied by the member's total years of service. As of July 1, 2010, the amount is $1.88/per month/year of service. Therefore, someone with 30 years of service got a $676.80 increase in their pension. The amount is ($1.88) increases each year by three percent. State statute specifies that future increases to the Uniform COLA are not a contractual right. The Uniform COLA was never funded by Plan 1 employees and employers and has therefore contributed to the state's unfunded liability. The Governor proposed to end future automatic Uniform COLA increases. This proposal would save the state $368 million General Fund-State in the 2011-13 biennium. In addition, it will reduce public employer payments by an estimated $9 billion over the next 25 years.
New Hires:
The Governor is proposing to discontinue incentives to retire earlier than age 65 for new hires in Plans 2 and 3 for PERS, TERS, and SERS (School Employee Retirement System). This action would save $2.2 billion over 25 years for state and local government. There is no immediate fiscal impact in the 2011-13 biennium.
Those of you who have the Seattle Firefighters HealthCare Trust, administered by Benefit Solutions for you health care or as a supplement to Medicare, may have noticed a deduction on your December retirement check. This $38.00 deduction was for the Silver Script premium which is your Plan D prescription drug insurance. Previously the Silver Script premium was taken out of your Social Security check or paid directly by non Medicare members. Sometime ago and without notice, Social Security discontinued withholding the Silver Script premium from your Social Security check. Everyone had to pay the premium directly each month. We tried to have the Silver Script premium deducted from the pension check at that time but it was not possible. Recently a decision was made to allow the Silver Script premium to be paid by payroll deduction from the pension check. However again, we were not notified. The question was asked “How can they take a payroll deduction from our pension check without our authorization?” The answer is because this is a group plan along with your Firefighters Health Care Trust. Because this premium is paid by payroll deduction they were authorized to include the Silver Script premium. With this being January we thought it would be a good time to remind our members to notify family members of your basic medical benefits in the event your spouse precedes you in death or in the event you both become incapacitated. We are also including the information forms that were in the April 2008 Newsletter.
Please fill out the applicable information and put the forms with your other important papers. Please share some of this information with your children or other family members.
We have recently helped the family of a member who is suffering from dementia receive reimbursement for the payment of medical bills. The wife is deceased and the siblings were not aware of the father’s medical benefits.
We are currently assisting a surviving spouse of a member who retired on a duty disability and died in 1969. Unfortunately the widow has been paying income tax on this pension for many years without knowing that the pension was non-taxable. This is why we don’t want the boards to issue 1099 for tax exempt pensions. If your board is issuing 1099s for disability pensions under LEOFF RCW 41.26 or the Prior Pension Act RCW 41.18, please let us know so we can try to persuade them that this is not necessary.