HUNTSVILLE, Ala. (WAFF) – The last time Alabama retirees received a cost of living increase was more than a decade ago.
“They granted it to all organizations,” said Norris Green, president of the Alabama Retirement Association. “Retirees are the only group who are no longer working, so they can’t go out and find a new job. The amount of money you give them when they retire is stagnant and hasn’t kept up with inflation. .”
Greene sees problems with the way cost-of-living adjustments, or COLAs, are passed by lawmakers. Each year, lawmakers must vote on the COLA and set the cost over a participant’s lifetime.
Example: In 2007, the last incremental cost was estimated at $1.4 billion. This is money the state doesn’t have but is forced to fund each year, which is why lawmakers can’t agree to pass a new increase.
The new bill would change the process.
“This bill didn’t cost us a dime,” Green said. “This is a change to the Retirement Benefits Act to introduce a retirement benefit plan.”
Greene personally authored the bill to give lawmakers more room to adjust from year to year. It passed unanimously in the state Legislature, but Green said state Sen. Arthur Orr held up its passage.
Orr told WAFF:
“I’m committed to funding retirees’ COLAs, but we have to be careful what we hand out,” Orr said. “A bill like this has never been used in this country before. There has been great concern from people in the retirement world about this.”
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