New Year Begins With Governor’s Proposed Fy25 Budget
2024 began with news that Governor Maura Healey would implement 9C cuts to the current FY24 budget due to declining revenues, thereby reducing certain line items in that budget.
On the heels of the 9C cuts the governor filed her Fiscal Year 2025 budget at the end of January, kicking off the budget season in the Commonwealth. The proposed $58.15 billion FY25 budget attempts to balance moderate spending increases while simultaneously controlling costs through a variety of measures.
Along with the COLA Study Commission language (see Page 1 lead article), the budget included several other items important to retirees. The budget proposes a 3% COLA for members of the State and Teachers’ Retirement Systems. As we reported in the May 2023 edition of The Voice the FY24 budget included a new 3-year funding schedule for the Commonwealth Pension Liability Fund. Funding remains on track with the appropriation of approximately $4.5 billion, meeting the obligation of the second year of the schedule.
Finally, the proposal includes a direct appropriation of $2.169 billion for the Group Insurance Commission (GIC). Also, no changes in contribution rates for retirees and active members have been made. State retirees contribute 10, 15, or 20% depending on the retirement date. Active members contribute either 20% or 25% depending on hire date.
When we went to print, we were still awaiting further action by the Joint Committee on Public Service on the Association’s legislation that is before the committee. The legislature has a joint rule that would require them to act on legislation by February 7th.
At press time, this date had not been extended, but there is a possibility that the committee could execute an extension order on bills within the committee itself. Any additional action after press time, will be shared via weekly videos/ emails, the hotline, or future editions of The Voice.