Saugus Town Meeting members increase pension benefits for retirees

Town Meeting members approved a cost of living adjustment that will mean more monthly pension benefits for retired town employees.

 

Article 26, which asked Town Meeting to increase the maximum base on which the annual cost of living increase is calculated for retirees of the Saugus retirement system to $14,000, passed 39-5 at Tuesday’s Town Meeting.

 

The Finance Committee had voted to recommend referring Article 26 back to the Saugus Retirement Board.

 

Finance Committee Chairman Ken DePatto pointed out that the town still owes $36 million in pension obligations in addition to having a $105 million unfunded liability in other post-employment benefits (OPEB).

 

Given those budgetary pressures, DePatto said the Finance Committee couldn’t support increasing the cost of living threshold from $12,000 to $14,000.

 

“We don’t feel comfortable to give more money for benefits when we still owe so much,” DePatto said.

 

Retirement Board Chairman Bill Cross said that 85 percent of the communities in Massachusetts have already hiked their cost of living adjustment base to $14,000 and some have gone to $16,000.

Increasing the cost of living adjustment base to $14,000 would amount to $5 a month more for the average eligible retiree’s pension, Cross said.

 

“When you think about it that’s not a lot of money,” Cross said, adding that the additional pension payout will likely be eaten up by rising insurance costs and inflation.

 

 

Even with the cost of living adjustment base increased, Cross contended that the town’s pension obligations will be on track to be paid off by 2028.

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