MMA opposes costly bills that would move municipal employees into different retirement groups, increasing pension and health liabilities

The Honorable Kenneth I. Gordon, House Chair
The Honorable Michael D. Brady, Senate Chair
Joint Committee on Public Service
State House, Boston

Delivered electronically

Dear Chair Gordon, Chair Brady, and Distinguished Members of the Committee,

On behalf of the cities and towns of the Commonwealth, the Massachusetts Municipal Association wishes to offer comments on a number of bills before the Joint Committee on Public Service. The MMA has significant concerns with legislation that would add to the pension and retiree health insurance liability of cities and towns by moving employees into retirement groups with more generous benefits. We ask the Committee to carefully consider the financial impact on municipalities and local taxpayers when reviewing any legislation that would significantly alter retirement benefits for public employees.

The MMA strongly opposes several bills that would move sets of employees from one retirement group into another, including H. 2461, H. 2665, S. 1659, S. 1674, S. 1729, S. 1683, S. 1730. All of these bills would move certain Group 1 employees into Group 2 or Group 4 for purposes of retirement. This change would significantly enhance the retirement benefits for these employees and would allow them to retire early, thus dramatically increasing the unfunded municipal retirement and OPEB liability. Additionally, the MMA strongly opposes H. 2471, a bill that would remove Group 1 altogether and sweep all general government employees into Group 2. This legislation would have a crippling impact on city and town finances, and would cause a wave of early retirements. These retirees would receive generous pension and retiree health insurance benefits for many more years than previously anticipated, while municipalities would also be compensating new employees to fill the vacated posts. Cities and towns are already struggling with high inflation, supply chain disruptions, and local revenues that are capped by Proposition 2½. The MMA urges the Committee to reject these unaffordable bills.

The MMA also opposes S. 1670 and S. 1747, bills that would provide municipalities the option to enhance the retirement benefit of any group of employees by moving them into a more generous group classification. This bill would further politicize the group classification process, leaving group designation up for negotiation and constant upheaval. This legislation could also create a scenario by which employees with the same job description in different communities could be in different classification groups. Further, the legislation fails to recognize the massive confusion and challenge that would be created when employees consider changing jobs across communities, and would make retirement calculations extraordinarily difficult. This legislation is unnecessary and problematic, and we ask you to reject it.

In summary, we respectfully ask you to oppose the costly and unwise bills outlined above. If you have any questions, please do not hesitate to have your office contact me or MMA Senior Executive and Legislative Director Dave Koffman at dkoffman@mma.org or 617-426-7272 ext. 122 at any time.

Thank you very much for your thoughtful attention to these very important local government concerns.

Sincerely,

Geoffrey C. Beckwith
MMA Executive Director & CEO