* Greg Hinz has the best details on the pension reform bill of anyone in the mainstream media…
Under the proposed new formula, the COLA only would apply to one’s years on the government job, times $1,000. That means, for instance, that a 25-year government veteran would get a 3 percent annual COLA only on the first $25,000 of their pension, even if the total pension was $50,000. That employee would get no COLA on that second 25-grand.
That $1,000 figure would increase with inflation. But insiders say there would still be huge savings because of the portion of one’s pension that would not get a COLA. Those with particularly high pensions would be really zapped; lower-salaried workers, less so.
Subscribers have known about this for quite a while now.
* This isn’t new, either, but won’t please many…
In addition, all COLA would be eliminated for one to five years for current state workers (not retirees), depending on their age.
Another savings would come from raising the retirement age. Those workers who are at least 45 years old would see no change. But younger workers would gradually have to work up to five years longer to start receiving their pension. (In some plans, you can retire as young as 58.)
In exchange, workers would contribute 1 percentage point less of their salary toward their retirement than what they pay now.