Proposal would end benefit penalty

BANGOR – State employees could receive increased retirement benefits if members of the congressional delegation have their way.

Speaking during a public forum Thursday sponsored by the Maine Education Association and the Bangor Education Association, Sen. Susan Collins and U.S. Rep. John Baldacci said they are co-sponsoring federal legislation that would repeal the laws penalizing Maine’s teachers and other public employees.

The Social Security penalty laws known as the government pension offset and the windfall elimination provisions have a particularly onerous effect in Maine where most public employees are covered by the Maine State Retirement System instead of Social Security.

The windfall elimination provision reduces Social Security benefits for retirees who took a second job in the private sector and thus paid into both Social Security and the Maine State Retirement Fund.

The government pension offset reduces an individual’s survivor benefit under Social Security by two-thirds of the amount of his or her public pension and sometimes eliminates Social Security benefits paid to a spouse, widow or widower who already receives a government pension.

The laws affect public school teachers, technical college faculty and administrators and other state employees such as firefighters and civil service workers.

Legislators listened sympathetically Thursday as some of the 500 people who crowded into Peakes Auditorium came forward to tell their stories.

Despite years of hard work, they said, they lost or stood to lose thousands of dollars because of the law’s inequities. Some worried about how their spouses would fare after they were gone; others wondered how the state would attract future teachers.

The National Education Association, Maine Education Association and Bangor Education Association all have lobbied for the pending legislation, representatives told the crowd.

Their support should make all the difference, said Baldacci, who previously unsuccessfully sponsored a number of similar bills.

“This is the first time that the NEA has made this a national issue,” he said. “Before, it was isolated.”

The legislation likely will be taken up next year when Congress is due to begin overhauling the Social Security system, Collins said.

Both legislators urged people to keep up the pressure.

“This may not occur right away,” Baldacci said. “But we need to keep forging ahead and not let this take a back seat.”

Maine is one of 15 states affected by the windfall and offset provisions because teachers and most state employees are required to contribute to a state pension instead of Social Security.

Critics charge that many state jobs, including teaching, are not highly paid and are targeted unfairly by the 1983 legislation.

Under the windfall elimination provision of the current federal law, private-sector retirees receive monthly Social Security checks equal to 90 percent of their first $561 in average monthly earnings, while government pensioners are allowed to receive only 40 percent.

The program is designed to prevent people from unfairly benefiting from provisions aimed at low-income workers, who receive a higher percentage of their pre-retirement earnings under Social Security than those with higher incomes.

Under the government pension offset, public employees often lose their entire spousal benefit even though their deceased spouse paid Social Security taxes for many years.

The offset was added to prevent spouses with government pensions from receiving larger benefits than spouses who received only Social Security benefits.

Collins said she plans to ask the Senate Finance Committee to consider the legislation immediately. She hopes to collect at least 1,000 signatures from teachers and public employees to accompany the request.

For more information, log on to www.Maine.NEA.ORG.