Schuylkill board hears retiree plea for 3 percent increase

It’s been 10 years since retired Schuylkill County employees last saw a cost-of-living increase in their pensions.

On Thursday, dozens of members of the county retirees association showed up at a public county retirement board meeting to once again ask for the 3 percent increase.

The board sent them on their way with a promise at the behest of Commissioner and board member Gary J. Hess to consider the question when they meet next, on Dec. 13.

The last increase was in 2007. Until 2015, the retirement board had balked at increasing the pensions because they would have had to make the raise retroactive, costing millions. But state legislation has since relieved them of that requirement.

On Thursday, board members met the retirees’ request with arguments that a cost-of-living, or COLA, increase could hit the county’s general fund, and by extension, taxpayers.

The increase would come from the retirement fund and cost $182,000, and not all of the 593 retirees would qualify for it, said Joan Dietrich, president of the Schuylkill County Retirees Association.

Currently, the fund is at $137,052,571, said Deputy Controller Ron Zimmerman.

“The retirement fund is solvent and has the capacity to grant much-needed adjustments to our monthly benefits without the adjustments being excessive and jeopardizing the solvency of the fund,” Dietrich said.

“The timing is perfect right now,” retiree Dan Grow told the board. “The (stock) market has been phenomenal.”

Board Chairman George F. Halcovage Jr., who is also commissioners’ chairman, said retirees’ health care costs keep rising, and that’s where the money needs to go.

Those who retired before 2004 receive lifetime health benefits, paid from the general fund.

After the public meeting, Human Resources Director Martina A. Chwastiak said that last year, the county spent a total of $5,652,841 for retirees’ health benefits. That includes prescriptions, payments in lieu of health benefits, and Medicare Part B reimbursements, she said.

The costs have been rising at a rate of about 6 percent each year, she said.

But the retirement fund is something separate and apart from our health care benefits,” Dietrich said. The “post-employment benefits are part of a separate contractual agreement between the county and the unions.”

Further, of the current 575 active county employees, 363 will not be eligible for the retirement health care benefits, she said.

Halcovage has said that in addition to health care costs, the county’s general fund is also the source of the county’s annual required contribution to the retirement fund.

The county contributed 6.61 percent to the retirement fund this year. In 2012 and 2013, it was over 11 percent, said Deputy Controller Ron Zimmerman.

Employees contribute 8 percent. They currently earn 4 percent interest on their money.

“I agree with Gary (Hess) that you deserve (an increase),” said longtime Commissioner Frank J. Staudenmeier.

“This board and the previous boards of commissioners have never, ever reneged on the (annual required contribution), and that has a major, major implication on the county budget.”

However, he said, “A lot of retirees do renege on their (annual required contribution). And that’s why there’s a lot of debt. That’s why the Commonwealth of Pennsylvania is in a hell of a lot of debt.”

It would be easy to just say yes to the increase, he said.

“But our choices aren’t made just on our own employees and retirees. Our choices are made on behalf of the 147,000 people in Schuylkill County.”

Staudenmeier said that because the 2018 budget is just being put together, the board doesn’t have enough information to make the decision right now.

The retirees are losing patience.

Hess moved to approve an increase in March, April, May and again in June. Each time, his motion died for lack of support.

The fund is healthy, there would not be retroactive increases, and the county has saved money by changing the structure of how it contributes to the retirement fund, he said.

“After 10 years, I felt it is the right thing to do,” Hess said. “These folks have worked very hard for the county, and they deserve an answer.”