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Date: 3/7/2023
NORTHAMPTON — Northampton is on the verge of approving an increase to the Cost-of-Living Adjustment (COLA) for retirees from 3 percent to 5 percent to supplement a time of high inflation.
According to the order, the Northampton Retirement Board engaged the services of Stone Consulting to conduct a study on the impacts of a one-time additional 2 percent increase to the fiscal year 2023 (FY23) COLA. They eventually voted to accept the increase after reviewing the study.
A COLA is an increase made to social security and supplemental security income benefits to counteract the effects of rising prices in the economy.
Back in the fall, then-Gov. Charlie Baker signed into a law an act that empowered local retirement systems to increase local COLAs from 3 to 5 percent. Now, Northampton has the ability to institute that increase with a simple vote from the City Council.
With seemingly unanimous approval, the council decided to send the item to the consent agenda for their next meeting on March 16. They will officially vote on the order during that meeting.
On March 2, Northampton Finance Director Charlene Nardi – who also sits on the Northampton Retirement Board – said they accepted the increase mainly because the Social Security Administration announced that the federal retiree COLA increase was the largest in four decades and is now at 8.7 percent, which is applied to federal retirees under the Civil Service Retirement System.
“The local option is for a one-time increase to the gross retirement allowance of Northampton retirees and survivors from 3 to 5 percent capped at the base of $13,000, and it’s retroactive to July 1, 2022” said Nardi. “To qualify for any cost of this living adjustment…the employee must have retired prior to July 1, 2021.”
According to Nardi, the average annual increase a qualified employee would receive is an additional $217 a year, and there are 444 retirees who qualify for this increase. Out of those 444 retirees, 24 percent of them receive less than the $13,000 COLA base in Northampton.
Northampton’s COLA has been situated at 3 percent for the last 20 years.
“I feel that the additional 2 percent will help our retirees navigate the growing costs such as…the increase in real estate tax, the stormwater runoff, the increase costs of their supplemental health insurance, and also their homes, their cars, their fuel, their food,” said City Councilor Marianne LaBarge. “To me, I think they deserve this.”
Reminder Publishing will have more on this subject after the next meeting.
The council also voted in a resolution that recognizes the first Monday of each March as COVID-19 Remembrance Day, in recognition of those who died as a result of the coronavirus pandemic and the “suffering of those who survived but carry the long-term effects of the virus.”
The order also urges the state legislature to pass a bill that would make the observance of COVID-19 Remembrance Day an annual event statewide. State Rep. Mindy Domb and Natalie Blais introduced this legislation to the state.
“I think it’s really important to have a remembrance day for COVID-19,” said City Councilor Jamila Gore. “My thanks to all the essential workers who worked so hard and still continue to work to battle this virus.”
The March 2 meeting was the City Council’s first gathering in a hybrid format. The March 16 and 30 meetings will also follow this format.