As legislative leaders from the North Carolina General Assembly continue to draft a 2023 biennium budget, these men and women must do better for retired public servants.
As it stands now, the bare bones senate budget has a meager 1% bonus in both years of the biennium. While the state house provides recurring money for retirees, its 2 percent cost of living adjustment will not touch the wounds of inflation inflicted in these economically turbulent times.
Both the senate bonus and the house COLA are well shy of meeting the needs of our retired public servants Approximately 47 percent of all state retired public servants draw annual pensions of $15,000 or less. A 1 percent bonus of $15,000 yields $150 annually for many retirees, less for many others. This amounts to a paltry $12.50 extra per month.
Compare this to the rise of inflation. Since 2011, the Bureau of Labor Statistics reports that inflation has averaged 2.4% a year, so what cost $1.00 in 2011 now costs about $1.33. Our purchasing power has been drastically reduced.
Retired public servants struck a bargain when they began service with the state. Generally, they accepted lower salaries but understood there was job security and benefits that made the jobs more attractive. Included in that bargain was the consideration that even in retirement, pensions would grow, at least modestly, to keep pace with rising costs.
Most retired public servants served North Carolina during an era when our state population doubled (from 1970 to 2020, the state population grew from slightly more than five million to over ten million). All those extra folks required more services, delivered by our public servants, who saw their jobs grow exponentially more difficult.
The General Assembly is required by the State Constitution to fully fund the retirement system. This funding does not include adjustments or bonuses. We are reminded by some legislators that since they are meeting that statutory requirement, they are not obligated to give COLAs or a bonus to retirees. Technically, that is correct. But statesmanship and lawmaking are more than numbers: it’s meeting the needs of those a lawmaker is charged to serve. Today, with a budget surplus, there is no excuse to prevent a meaningful adjustment for retirees.
A bargain made should be a bargain kept. With the financial resources now available to the legislature, they should invest in the folks who helped get them here.
Michael Taylor is president of the North Carolina Retired Governmental Employees Association. He spent his 32-year career in the N.C. Community College System serving four community colleges, the last 15 as president of Stanly Community College in Albemarle.
