Author Archives: nhretirement

NH House Finance Committee Denies NH Retirees a Cost-of-Living Adjustment

For Immediate Release

Contact: Casey McCabe,

February 21, 2018


NH House Finance Committee Denies NH Retirees a Cost-of-Living Adjustment

Concord – Today the NH House Finance Committee voted 14 to 10 to kill HB1756-FN, a bill that would provide a long overdue COLA to the 28,000 currently retired public employees. Several Republican members of the committee provided reasons for this decision that were based on misunderstandings of the NH Retirement System, false realities, and unfounded claims that the State has no responsibility for all public employees.

“We are incredibly disappointed in today’s vote. For decades, the NH Legislature recognized its responsibility to its state and municipal retirees,” explained William McQuillen, President of the Professional Fire Fighters of New Hampshire and Chairman of the NH Retirement Security Coalition. McQuillen when on to explain, “Until eight years ago, the legislature always put aside party politics to honor the dedication and hard work our retirees had given to the state. It is inexcusable for this House Finance Committee to set aside its responsibilities, yet again, when our retirees always held up their end of the bargain.”

The last time NH retirees received an automatic COLA was 2010.  There will not be another COLA granted to retirees until the NH legislature does something about it. Rich Gulla President of SEIU Local 1984 reiterated this point, “Our retirees have gone eight long years without a COLA. When began their careers there was an understanding their hard work would be recognized in their retirement. The 14 members of the House Finance Committee who voted against HB1756-FN turned their backs on NH’s retirees today and that is shameful.”

HB1756-FN will head to the full NH House in the upcoming weeks. There is still time for the NH Legislature to do the right thing and stand up and stand with the 28,000 retired state and municipal members.

If you’re interested in speaking with a spokesperson from the New Hampshire Retirement Security Coalition, please contact Casey McCabe at

NH Legislature expected to pass bill curbing ‘double dipping’

CONCORD — A bill that seeks to limit the income of “double dipper” public pensioners is recommended by lawmakers as “ought to pass,” according to the New Hampshire Retirement System, the pension pool for police, fire, school and other public employees.

In a Wednesday memo, the NHRS announced House Bill 561 was amended in the Senate Executive Departments and Administration Committee and, if passed as expected, will limit the number of hours pensioners can work at post-retirement jobs for employers in the public retirement system. The bill seeks to reduce the current 32-hour weekly limit of hours worked by pensioners at other public jobs, to 1,040 hours a year. That would mean a reduction of 624 hours a year and anyone found to have exceeded the limit would lose the employer-funded portion of their pension for a year, according to the proposed law.

The bill, as currently written, also states public retirees would have to wait 60 days from when they retire to the day they start working a subsequent public job. If passed by the Senate, the bill will be sent to the House and the NHRS has advised its members the legislation is recommended likely to pass.

The limits are based on the recommendation of the Decennial Retirement Commission, which was formed by law to “ensure the long-term viability of the retirement system” that has a $5 billion unfunded liability. The liability is the difference between promised pensions and funds in the retirement program. When public pensioners work post-retirement jobs, they’re no longer contributing to the retirement system, from which their pensions are drawn.

NHRS Executive Director George Lagos announced in October 2016 that 70 percent of the state’s public employers have a public retiree on the payroll so he was bringing the topic of double dipping to the DRC. He also raised the question about whether some jobs being performed by public pensioners can be accomplished in 32 hours a week.

“Common sense tells us that there is some doubt about whether or not certain managerial positions now categorized as part-time are truly capable of being accomplished within a 32-hour week, and whether those who are engaged in those positions are recording their time accurately and truly limiting themselves to no more than 32 hours,” he wrote.

In March, the New Hampshire Retirement Security Coalition – comprised of police, fire, teachers and other public employees unions – endorsed efforts to curb double-dipping. In a press statement, the union said double-dipping pensioners are “gaming” the NHRS.

“It’s fiscally responsible for both the system and employers,” said Portsmouth Fire Capt. Bill McQuillen, president of the NHRSC and the statewide firefighters’ union, about the proposed pension reform.

He said firefighters hear time and again at bargaining tables that the costs to employ firefighters gets more costly due to pension costs. “This is an opportunity to address that,” he said.

The proposed law is expected to be reviewed by the Legislature in January and, if passed, would have an effective date of January 2019.

Defined Benefit Pension Plans Help Retain Teacher Talent

By Paula Aven Gladych

Published November 12 2017, 9:00pm EST

The National Institute on Retirement Security wants to set the record straight about the positive impacts defined benefit pension plans have on public and higher education.

Diane Oakley, executive director of NIRS, says that there are “misleading assertions that DB pensions don’t offer incentives to retain teachers or that DB pensions force teachers to retire at early ages or they are not good for teachers.”

According to the NIRS report Win-Win: Pensions Efficiently Serve American Schools and Teachers, that isn’t true. Defined benefit plans help employers recruit and retain committed teachers so that schools benefit from educators’ increasing effectiveness, Oakley says. They do that by offering larger benefits later in a teacher’s career as an incentive for good teachers to stay in their jobs.

The pensions also better address obstacles to retirement income security by covering a majority of employees with adequate savings and managing the risk associated with retirement. The public also “overwhelmingly supports DB pensions for teachers and acknowledges their retention effects,” she says.

Christian Weller, professor of public policy at the University of Massachusetts-Boston and a senior fellow at the Center for American Progress, says that one of the things that drove him to address this topic with NIRS is that “public pensions, more so than private, are intentionally designed to help employers, schools, to recruit and retain skilled workers. They are meant to be a tool to combat old age poverty and give workers real middle-class security.”

He adds that pensions create meaningful incentives for people who take jobs in schools and stay on the job for long periods of time by deferring their compensation into the future.

“The longer you stay, the more you are going to get. People do react to that kind of incentive and that has a number of benefits for the employer,” Weller says.

The biggest is that teachers tend to get more effective with experience. The other benefit is that defined benefit plans “aren’t moving up and down with the market and employers can manage their workforce more predictably,” Weller says.

Teachers who have access to defined benefit plans stay on the job longer, Weller says. There is higher turnover with defined contribution plans, which can cost schools more money because they need to spend time and money hiring someone new and then training them.

State and local budgets tend to fluctuate constantly so “knowing what is happening with teacher salaries makes budgeting a lot more predictable in the way they need balanced budgets,” he says.

Defined benefit plans also allow teachers to retire at a more predictable age, which helps the employer do a better job of managing turnover. But, Weller says, there is nothing in a pension that says you have to retire at age 62.

“You can still continue to earn benefits you just don’t get as much in terms of additional money leading up to retirement,” he says. “You don’t get pushed out the door when those early retirement incentives go away.”

Defined benefit plans put the long-term financial risk on the employer because “it can manage these financial risks more efficiently, which is a real savings to teachers and a real savings passed on in terms of higher benefits and higher lifetime income,” Weller says.

He points out that only 51.3% of private-sector workers had access to a retirement savings plan through their employer but 82.4% of public workers were offered a plan.

Defined contribution plans are now trying to duplicate the auto enrollment feature that has always been a part of defined benefit plans, but it isn’t automatic at this point. Employers have to make the decision to offer automatic enrollment.

In the public sector, employers and employees make median contributions of 6% to 8% of pay to retirement savings, while in the private sector, that median combined contribution rate is about 6%, he says.

Pension plans also have to plan for the average life expectancy but with defined contribution plans, “you have to plan for the possibility you are going to live to 105,” Weller says.

Defined benefit plans do a better job of distributing household income in retirement because everybody participates, everybody contributes the same and everyone gets the same benefits, he says. In the defined contribution plan space, “we know that not only are higher income earners more likely to be offered a plan, they are more likely to contribute and contribute more,” he says. “The DC world works well if you are rich but it doesn’t work for middle class families.”

Teachers who have a pension plan know their retirement income security is high. “You don’t have to live on cat food. You don’t have to struggle in retirement. That peace of mind means that teachers and others can take a longer view of their future. They can take it easy,” Weller adds.


Blame Amazon for America’s underfunded public pensions

You have to give Amazon credit. In a rare public auction, the retail giant promised up to 50,000 jobs at a second headquarters, or “HQ2,” and sat back while 238 cities and states tripped over each other to offer the most lucrative tax break packages. While most of the bids have yet to be disclosed, some are staggering, especially considering the same states have recently claimed they don’t have money for pensions, education, infrastructure, or other state priorities.

Illinois and New Jersey, two states notorious for underfunding their public pensions, are suddenly flush with cash when Amazon comes calling. Illinois’s bid with Chicago is priced at $2 billion. New Jersey’s bid with Newark more than triples that at a whopping $7 billion. Since 2000, New Jersey has ranked last among the 50 states in making its annually required contribution to the pension system.

After pushing through harsh benefit cuts for workers, Gov. Chris Christie further shorted pension payments by almost $2.5 billion in his 2014 and 2015 budgets. New Jersey is so strapped for cash that it can’t keep its promise to workers, contributing money they have earned into their pension systems, yet it has $7 billion to offer Amazon?Now, you might say, New Jersey must be in this situation because of its overly generous pensions. But in fact, a study from the New Jersey Policy Perspective found that New Jersey ranks 95 out of 100 in generosity among the largest public sector pension plans. Pension benefits in New Jersey average $26,000 annually. While New Jersey shortchanged retirees, Christie has granted more economic development subsidy deals worth hundreds of millions of dollars than any governor in U.S. history.

Some of his costliest deals simply paid companies to move around within the state, and the appearance of “pay to play” surrounds the many deals in which executives at subsidized companies gave large contributions to Christie’s reelection campaign, the governor’s mansion fund, or the Republican Governors Association while Christie headed it. Before New Jersey makes any more corporate handouts, it should be forced to pay the bills it already owes to its firefighters, teachers, and public employees.

Amazon isn’t the only corporation seeking handouts from states at the expense of other critical state services. With the blessing of the White House, Taiwanese electronics manufacturer Foxconn played states against each other for a new liquid crystal display factory. Michigan offered $3.8 billion, while the state’s legislature switched the default retirement plan for teachers to an inadequate 401(k)-style plan.

It’s hard to believe that Michigan “can’t afford” to invest in education and retirement security for teachers. Foxconn ultimately chose Wisconsin, where the state, by its own admission, will take at least 26 years to break even on its deal. Wisconsin took a risky bet on a technology product that could easily become obsolete 10 years from now.

Taxpayers should be wary. There should be outcries in all 238 jurisdictions that bid for Amazon. Where is the accountability? It’s your money that won’t be used to keep classroom sizes reasonable for your children. It’s your money that won’t be used to fill the potholes that damage your car. It’s your money that won’t be used to adequately staff fire and police stations. As one economist recently explained, the place that “wins” the Amazon HQ2 deal could actually overspend and end up a big loser.

Politicians may tell you that pensions are to blame for public service cuts, but corporate tax breaks and subsidies dwarf pension costs in most states. Not to mention, pensions are a proven economic engine for states. So if you live in one of the 238 places courting Amazon, demand that they disclose their HQ2 bids and live up to their existing obligations first.

Bailey Childers is executive director of the National Public Pension Coalition.