After perhaps the messiest legislative session of my own memory, many deserving groups got shortchanged because of today’s brutal political narrative.
Government retirees are perhaps among those most hurt in this process. Retired teachers and state government retirees received a bonus that one would easily deem inadequate. Yet even that small bonus fell into a hyper-political tug of war between the governor and the legislature. And the tugs knocked state government retirees over, as this little bonus was vetoed by the governor.
The opportunity to allocate additional money for retirees won’t happen until January 2020.
Local governments have yet to embrace just how badly their retirees’ pensions have declined in value. North Carolina historically gave yearly recurring cost of living adjustments to keep a retiree’s pension from losing value against the ever rising tide of inflation. But 10 years after the Great Recession, this tap remains closed. Local government retirees have received less than 1% in cost of living adjustments since 2009, a pittance that’s really not even worth mentioning.
An average retiree earned less than $20,000 in retirement last year, making ends tough to meet for a majority of our state’s 320,000 local and state government retirees.
The immeasurable positive impact public sector professionals have on our local communities are often unseen in our day to day lives. Yet our communities reap a significant value from the labors of these men and women, making order rather than chaos, health rather than malady, safety rather than danger.
Richmond County has more than 1,100 local and state government retirees. This group of men and women gave deeply to their community and state throughout their public service careers, and continue to do so in retirement as they continue to live, play and spend here locally.
And spend they do. Retirees statewide produce almost $7 billion in economic output, supporting an additional $2.2 billion in wages and salaries for related jobs. According one study, for every pension dollar paid, the pensioner in turn spends $1.45 in their local community.
Also, both state and local government retirees contribute handily to the pension system — state employees contributing 6% of their pretax income from the first day of employment, to their last. A pension is by no means a gift. Local and state retirees who leave with a full pension have invested 25 to 30 years into their public sector careers, an ample, respectable length of service.
Even if and when the well begins to flow again, there are other roadblocks to navigate. For local retirees, adjustment funding thresholds are arbitrary and nearly impossible to achieve: a devastating scenario when coupled with skyrocketing contribution rates for local governments. Pension values have declined so significantly there is no way politically or from a structural standpoint bring them back to their intended values.
But something is more than nothing. And nothing is destroying the wellbeing of tens of thousands of retirees statewide. Retirees contributed to the health and prosperity of our state and local communities, they are of positive economic impact to their communities and the state, and they themselves have in large part contributed to their own retirement benefits.
The retirees have done their part, it’s time for the us to step up and do ours.
Richard Rogers is executive director of the North Carolina Retired Governmental Employees Association.
