Mass Retirees officers were among the retirement board officials who attended the Annual Spring Conference of the Massachusetts Association of Contributory Retirement Systems (MACRS), which is the official representative organization for the board members of the Commonwealth’s 104 retirement systems. More importantly, some were featured speakers.
Both Legislative Chairman Tom Bonarrigo and Legislative Liaison Nancy McGovern presented as part of a legislative panel that included William Keefe, assistant deputy director for the Public Employee Retirement Administration Commission (PERAC) at the annual MACRS event. The panel was moderated by Boston Firefighter Michael O’Reilly, who is an elected member of the city’s Retirement Board and the MACRS legislative chairman.
Bonarrigo kicked off the presentation by covering the work the Association performed during the FY24 budget process relative to increasing the COLA base for the State and Teachers’ systems. While those efforts were unsuccessful, he indicated that work continues on the stand-alone bills that the Association filed relative to the issue as well as a bill relative to an Enhanced COLA for long term retirees.
McGovern highlighted the Association’s other priorities for the current legislative session, namely an increase in the Veterans’ Bonus, and increasing the basic life benefit for state retirees. Also covered was the work the Association does for survivors, in particular, legislation focused on retention of health insurance benefits should a survivor remarry and new legislation that would give survivors, receiving a pension, the right to vote in board elections. In closing, McGovern gave a brief update on the current landscape of municipal health insurance and the role of the Association in that process.
Other Conference Speakers & Association Friends
In addition to our participation, there were several longstanding friends of the Association who spoke at the conference. That list includes Hank Kim, who is executive director of NCPERS (National Conference of Public Employee Retirement Systems, PERAC’s Executive Director John Parsons and Mike Trotsky, executive director and chief investment officer of PRIM (Pension Reserves Investment Management) Board, who is featured in the separate article here.
Briefly, NCPERS is the largest non-profit trade association representing approximately 500 public sector Defined Benefit (DB) plans that have approximately $4 trillion in assets. In our nation’s capital, they are at the forefront promoting DB plans and defending against efforts to undermine them.
Kim presented several important historical and current facts relating to DB plans, Including:
- State/Local DB plans are valued at $4.961 Trillion (as of March 9, 2023), compared to $3.083 Trillion in private sector plans.
- There are 197 million employed by state and local governments, with 133 million in the private sector.
- Public pension plans have been around for more than 150 years, beginning in 1857 with New York establishing a lump sum benefit for NYC police.
Also, Kim highlighted the NCPERS 2023 Public Retirement Systems Study, which marks its 12th year. We note that the NCPERS study is very comprehensive, exploring public sector retirement practices, analyzing the most current data on retirement funds’ current fiscal condition and identifying best practices and strategies to lower unfunded pension liability.
While NCPERS is a national nonprofit advocacy organization, PERAC is a state agency that oversees the Commonwealth’s 104 retirement systems. Traditionally, its executive director is invited to speak, and this conference was no different with a presentation by Executive Director John Parsons.
During his presentation Director Parsons addressed a range of issues. Here are highlights from his remarks.
Even with a new Governor and Auditor, who collectively appoint 6 of the 7 Commission members, PERAC has been fortunate to retain each of its Commissioners. We’re also fortunate to have a committed, experienced, Commission that prioritizes the fiscal health and administrative strength of our collective Chapter 32 system.
Parsons spoke about PERAC’s upcoming board training in conjunction with the Inspector General’s Office, full day Administrator trainings for new board staff and the annual Emerging Issues Forum at Holy Cross in September.
He outlined the new PERAC legislation filed this session to protect retirement systems from significant unfunded liability when a new entity joins the system, as well as the Commission’s legislative priority to extend the time period for veterans to purchase their service time.
On the Disability application front, the Director notified boards that with the lifting of COVID restrictions that joint medical panels are now an option again.
Finally, Parsons concluded his remarks emphasizing the board members’ fiduciary duty to their members and to refrain from allowing political/ideological leanings to interfere with their primary fiduciary duty.