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8.7.03 M.U.D. won't change pension disparity They are getting old. Times have changed. And the longtime retirees of the Metropolitan Utilities District would like to see their pensions, in some cases negotiated years ago, reflect one of the more significant benefits gained by recent retirees. They would like to see an end to deductions made for their Social Security benefits. That won't be happening. The M.U.D. board on Wednesday tabled any further study of the issue, effectively killing the proposal for now. Recent retirees receive their full pension, without a deduction for Social Security benefits. Those who retired before April 1, 2001, have anywhere from 20 percent to 50 percent of their Social Security benefits deducted from what otherwise would have been a larger pension payment. The difference, according to figures provided by the M.U.D. Retirees Association, contributes to a substantial gap in pensions. The average pension for those who retired before April 1992, according to the association, is $898. The average pension for those who retired after April 2001 is $2,740. Other factors contribute to the difference, too. Changing the policy would require the utility to fold $9.2 million more into the plan to cover the higher payouts, according to M.U.D. "Those dollar amounts are staggering," said board chairman Mark Doyle. Ratepayers, not employees, would have to fund the difference, he said, and enough money is involved that a rate increase would be possible. "We can't go to the ratepayers for that kind of money," he said. "Some of them are retirees, too." The issue affects MUD's 313 retirees to varying degrees. Ross Cavaleri, president of the retirees association, argued that the employee contributions made by those who are long retired provided the nest egg that made today's benefits possible. As a compromise, Cavaleri asked that the board ease the burden on 174 retirees, generally the oldest, by reducing their Social Security deduction from 50 percent to 40 percent. "The cost will reduce fairly rapidly," he told the board in a memo, "as death inevitably takes place." |
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