Retired Teachers Chapter News

Automatic COLA increase — September 2008

Jun 5, 2008 12:39 PM

The battle for an automatic cost-of-living adjustment for retirees is long since won, but we have not retired from the field. The UFT and NYSUT continue to plug away in Albany to improve the COLA.

Our legislative program includes seven COLA bills that would impact different things such as: a bill to increase benefits for older retirees more heavily hit by inflation because of their early year of retirement; an increase in the annual inflation index used to calculate the annual COLA from 50 percent to 100 percent of the Consumer Price Index (CPI); an increase in the maximum retirement benefit used in calculating the annual benefit from $18,000 to $25,000.

Despite these tough budget times, we will keep working to win these incremental COLA gains for our retirees.

In 2000, after frustrating years, the UFT, NYSUT and the rest of the state’s labor movement convinced New York State to provide an annual, permanent cost-of-living adjustment to our pensions.

The legislation, which was signed on July 11, 2000, provided a two-pronged approach to enhance and protect the retirement benefits of all current and future retirees. The first prong, a “catch-up” COLA, took effect in September 2000. It raised the percentage used to increase the base pension of longtime retirees whose benefits had been severely eroded by inflation.

The second prong, beginning in September 2001, was the permanent, automatic and annual adjustment of retirement benefits linked to the increase in the CPI. The COLA is based on 50 percent of the increase in the CPI from year to year (March to March). The annual increase is based on your pension if it is less than $18,000 per year, or on the first $18,000 of your pension per year.

Based on current CPI figures, the September COLA is 2 percent. The benefit is paid to:

• retirees who have reached age 55 and have been retired for at least 10 years; or
• retirees who have reached 62 and have been retired for at least five years; or
• retirees who have retired for disability and have been retired for at least five years; as well as
• the spouses of certain deceased retirees who are collecting benefits under joint and survivor options.

At a retired teachers meeting early in 2007, a resolution was passed that urged improvements in the present COLA law. The resolution that was adopted by the RTC and then by the UFT Delegate Assembly was passed at NYSUT’s April Representative Assembly. The UFT, working with NYSUT, will lobby in Albany to improve the present COLA benefits.