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MSEA-SEIU Local 1989
65 State Street
PO Box 1072
Augusta, ME 04332-1072
207-622-3151
1-800-452-8794

MAINE STATE EMPLOYEES ASSOCIATION

SEIU Local 1989

Biennial budget passes both House and Senate with a two-thirds vote;

budget now awaiting Governor's review and signature

MSEA-SEIU members made their voice heard in the proposed $6.2 billion, two-year state budget. By talking with legislators, testifying at hearings, signing petitions, attending rallies and working closer than ever with our coalition partners, we eliminated Gov. LePage's proposed 2 percent payroll tax on public workers and teachers. We also rolled back Gov. LePage's proposal to cap retiree cost of living adjustments at 2 percent.

 

Below are key elements of the proposed budget as they relate to retired state workers and the nearly 10,000 workers whom we represent in all three branches of state government. Keep in mind that the proposed budget is not yet final; it awaits Gov. LePage's review and signature. Check our website at www.mseaseiu.org for the latest developments.

 

LAYOFFS AND ELIMINATION OF VACANT POSITIONS

While we are encouraged that layoffs are being kept to a minimum, the elimination of over 250 vacant positions in state government will worsen the impossible workloads that many MSEA-SEIU members are experiencing. MSEA-SEIU stewards stand ready to ensure that everyone's contractual rights are protected in the delivery of quality public services to Maine people.

 

LONGEVITY PAY

We maintained funding for longevity pay for all state workers who currently have it. New longevity steps won't be awarded in the next two fiscal years, but those state workers who have longevity pay will keep what they have in their paychecks.

 

MERIT PAY

The proposed budget freezes funding for merit pay for the next two fiscal years.

 

PENSIONS AND RETIREE HEALTHCARE

    On pensions and retiree healthcare, we fought back hard against Gov. LePage's proposals to cause substantial harm to Maine's public workers, teachers and retired workers.
    • We eliminated Gov. LePage's proposed 2-percent payroll tax on state workers and teachers. This ill-conceived proposal was a new tax, pure and simple, on thousands of Maine workers. Legislators heard us when we told them it's wrong to impose a new tax on state workers and teachers to pay for Gov. LePage's tax giveaways to Maine's wealthiest residents.

    • We rolled back Gov. LePage's proposal to make everyone retiring after Dec. 31, 2011, reach age 65 before they would become eligible for fully paid health insurance. Legislators decided that state contributions toward retiree health insurance would begin at the normal retirement age (60 or 62) for workers vested in the retirement system as of June 30, 2011; however, as part of this transition, workers who have not yet reached their normal retirement age must retire by Dec. 31, 2011, in order to have fully paid health insurance immediately upon retiring. Otherwise, their eligibility for fully paid retiree health insurance wouldn't kick in until they reach their normal retirement age.

    • For workers hired on or after July 1, 2011, and for those not vested in the retirement system by that date, their retirement age would be 65 and state contributions toward their retiree health insurance would begin at age 65.

    • For workers hired on or after July 1, 2011, their vesting for retiree health insurance would be as follows: 10 years, state pays up to 50 percent; 15 years, state pays up to 75 percent; and 20 years, state pays up to 100 percent.

     

    • We persuaded legislators to eliminate Gov. LePage's proposal to make retirees pay five, 10 or 15 percent of their retiree health insurance premiums, based on the amount of their pension income. Legislators saw this proposal as yet another example of Gov. LePage trying to impose a new special tax on public workers and retired workers.

    • We rolled back Gov. LePage's proposal to reduce, from 4 percent to 2 percent, the cap on cost of living adjustments to pensions. Legislators accepted our proposal for a 3 percent cap. However, the proposed state budget permanently limits COLAs to the first $20,000 of pension income, indexed to include future COLAs. We opposed the $20,000 income cap and all income caps on retiree pensions. A more moderate proposal of a $25,000 cap was discussed, and ultimately rejected, by legislators.

    • In addition to capping COLAs at 3 percent and limiting them to the first $20,000 of pension income, the proposed state budget also freezes cost of living adjustments to pensions for three years. After the Appropriations Committee decided on a three-year freeze, we pushed for, and secured, language providing for possible "ad hoc" COLAs of up to 3 percent in the both second and third years of the freeze, based on available revenues. These "ad hoc" COLAs wouldn't be applied to the pension base, but they could put some money into the pockets of retirees depending on whether the General Fund has surplus revenues in those years.

 

FUNDING FOR THE STATE EMPLOYEE HEALTH INSURANCE PLAN

The proposed state budget freezes funding for the State Employee Health Insurance Plan for two years.

 

RETIREMENT INCENTIVE

The proposed state budget contains a retirement incentive for retirement-age-eligible employees who retire on or before Nov. 1, 2011. Although not specified in statute, the amount of $5,000 has been proposed.

 

LATEST DEVELOPMENTS

For the latest developments, check back at our website: www.mseaseiu.org