Dating back to our Association’s founding in 1968, we have maintained a close working relationship with the mayor of Boston. As the Commonwealth’s capitol city and the 3rd largest public pension fund, Boston often sets the tone when it comes to the retirement policies of our municipal governments.
Each mayor from Kevin White, through Ray Flynn, Tom Menino, and Marty Walsh have been supporters of public retirees and helped set a positive tone on public retirement policies that has been heard across Massachusetts. Current Boston Mayor Michelle Wu has followed in the footsteps of her four predecessors, both in terms of her support for public retirees and in forming a working relationship with our Association.
From Ray Flynn through to Michelle Wu, the City of Boston has aggressively funded its retirement system to pay off the accumulated unfunded liability well ahead of the legal deadline of 2040. With a pension fund now nearly 90% funded, Boston is well on track to reach fully funded status by 2028.
Pension costs for Boston Teachers, who are members of the Boston Retirement System, are paid for by the Commonwealth. The unfunded liability associated with Boston Teachers will be fully funded in 2036, the same year as the State and Teachers’ Retirement Systems.
While approaching fully funded status, Boston will be able to improve COLA benefits, both in terms of increasing the traditional COLA base and adopting the new Enhanced COLA benefit that is now being developed by the Special COLA Commission – without increasing the City’s pension appropriation. They will be able to do so by using a portion of the City’s current pension appropriation to fund new benefits.
Speaking of the Enhanced COLA, the concept for the benefit originated with former Mayor Marty Walsh. It is a great example of the fruit born from strong working relationships.
The COLA was among the key issues we discussed with Mayor Wu when she met directly with our leadership team in our Beacon Hill office this spring. Not only was Michelle Wu the only candidate in the race to actively seek our support, but the fact that she made a point to meet personally with us in our office and have a detailed conversation about the issues of direct importance to our members says a lot.
During the meeting we made our belief clear that the great success of the Boston Retirement System must be shared with the members of the system through improved COLA benefits. We also shared our hope that the City will continue to make incremental improvements beyond the current $15,000 base in the years approaching full funding.
In addition to a well-run and financed pension system, Boston has long maintained excellent health insurance benefits that are provided to retirees at an affordable price. We appreciate the fact that Mayor Wu recently extended the City’s current PEC agreement, without changes in contribution rates or out-of-pocket costs, until 2027. Given the pressure of healthcare inflation, the extension is that much more important.
Throughout her first term as mayor, as well as during her time on the City Council, Michelle Wu has proven to be a leader with whom we can work closely in the interest of our members. She understands the needs of public retirees and shares our commitment to strengthening Boston’s defined benefit pension plan. And given the budgetary stresses now placed on Boston (as well as other municipal governments), it is encouraging to have a mayor who does not view public retirees as a source of cost savings.
Actions always speak louder than words and Michelle Wu’s actions as Mayor of Boston earned her our support. We are pleased to endorse the reelection of Michelle Wu for Mayor of Boston and look forward to working closely with her to better the lives of Boston’s retired public employees.