Two Rulings Find Cuts in Public Pensions Permissible
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Judges in Colorado and Minnesota have dismissed court challenges by retired public workers whose pensions had been cut — developments that may embolden other states and cities to use pension reductions as a tool to help balance their budgets.
The two lawsuits sought to reverse reductions in the cost-of-living adjustments that Colorado and Minnesota had previously promised to retired public workers. Generally speaking, once lawmakers have agreed to provide certain pension benefits to public workers, it is difficult, if not impossible, to roll them back because of protective language in state laws and constitutions and years of court interpretations.
One judge drew a distinction between a base pension and a cost-of-living adjustment, often called a COLA. He suggested that the inflation adjustment could be reduced, but the base pension could not.
(Click Here for Entire Article)
Judges in Colorado and Minnesota have dismissed court challenges by retired public workers whose pensions had been cut — developments that may embolden other states and cities to use pension reductions as a tool to help balance their budgets.
The two lawsuits sought to reverse reductions in the cost-of-living adjustments that Colorado and Minnesota had previously promised to retired public workers. Generally speaking, once lawmakers have agreed to provide certain pension benefits to public workers, it is difficult, if not impossible, to roll them back because of protective language in state laws and constitutions and years of court interpretations.
One judge drew a distinction between a base pension and a cost-of-living adjustment, often called a COLA. He suggested that the inflation adjustment could be reduced, but the base pension could not.
Appellate courts in other states, including California and West Virginia, had found that cost-of-living adjustments could not be reduced.
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Thousand Points of Right
No one knows what affect these decisions will have on Bloomberg, Coumo and Company. Remember that there is still a budget deficit in the billions for the next few years and Bloomy has already taken all of the billions he tucked away for future retiree health care costs.
If Bloomberg decides to follow suit with the court decisions rendered above, there will surely be an outcry from all City & State retirees who do not participate in the VSF. There are literally hundreds of thousands of non-participants who would demand that the non-constitutionally protected VSF must go first, before any thought is given to taking away or reducing the prior pension supplementations and the 2000 COLA, which contained the catch-up increases.
Let's hope Bloomy is smart enough not to start, what would likely be a war among NYC retirees. jg
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