Increases approved five years ago are driving the rise in subsidizing pension costs.

Increases approved five years ago are driving the rise in subsidizing pension costs.
HARRISBURG (AP) -- The retirement benefits that state legislators have designed for themselves may strike many of their constituents as too good to be true.
After just five years, they vest in a system that guarantees them a monthly check for life, and their health-care costs are subsidized for the rest of their lives.
They can take early retirement, but by age 50 -- a decade earlier than most state workers -- they can retire with full benefits.
With pension costs expected to skyrocket in the next five years, and the state facing difficult decisions on how to cope with those increases, The Associated Press examined how state lawmakers are faring in the system.
The terms of legislative pensions are considerably better than what most of the 200,000 workers and retirees in the state retirement system get. But the structure of the retirement system -- a check a month for life -- is something that fewer and fewer of the people they represent will see when they stop working.
What records show
Records obtained through a Right-to-Know Law request showed 104 retired lawmakers on the pension rolls collecting an average of 30,000-plus a year after having put in an average 17 years in the Legislature.
Since their retirement plans offer some of the most generous terms, Pennsylvania lawmakers will likely find themselves in an awkward position in the coming years as pressure mounts to deal with soaring public pension costs.
Any structural changes to the state pension systems would almost certainly have to involve their own benefits.
"They definitely would be dealing against their own interests," said James A. Perry, executive director of the Pennsylvania Association of Public Employee Retirement Systems. "But I think if they take an honest, hard look at it, they should realize they've either got to come up with some more money or they're going to have to do something about benefits."
In 2012, the cost of subsidizing pensions for state workers and school employees is expected to jump from less than 1 billion to more than 3 billion a year. The increase is being driven in part by big increases lawmakers approved five years ago for everyone, including themselves. State workers and teachers received a 25 percent pension boost, most legislators a 50 percent increase.
Legislative critics say lawmakers' own personal stake in the benefits issue will make it much harder for them to deal with the pending pension crisis.
"The evidence of that is that it's taken them five years to come to grips with the issue," said Tim Potts, co-founder of Democracy Rising PA, a group advocating legislative reforms in the wake of the Pennsylvania Legislature's embarrassing withdrawal last year of a pay raise for its members.
Trump card
As discussion has turned to the need to rein in public pension costs, public-employee unions have already begun pulling out a trump card: the Legislature's own superior retirement plan.
Pennsylvania's pension system for state workers contains many features that other states do not have. But lawmakers' pensions offer particularly generous terms.
Nearly all lawmakers (some refused the 2001 boost) are now entitled to collect 3 percent of their peak salary for each year of service, compared with 2.5 percent for teachers and most others in the state workers' retirement system. In other words, someone who was making about 60,000 before he retired after 20 years in the Legislature would qualify for a pension of about 36,000 a year.
Legislators in office before the system was revamped in 1974 are credited for 7.5 percent of top pay for each year they work.
Complete figures on legislative benefits are not available, because some lawmakers have gone to work for other state agencies or the court system after leaving the General Assembly.
But records from the state employee pension fund listed 104 legislative retirees on the rolls, with an average monthly payout of 2,600 and an average cash withdrawal at retirement of 72,000. Like all participants in the retirement system, when they retire they are allowed to take out all the money that was withheld from their paychecks, plus 4 percent interest.
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