In this issue...

What are they saying

Pension Fund Reports 8% Return

The 10 Worst States for Retirement

AFTER THE ELECTIONS

November, 2010

Dear Ralph,

RPEA focuses on the critical issues facing New York's government re­tirees. We're
here to protect benefits and programs that are critical to our retirement - retiree health care, pensions, Social Security, Medicare and more.
RPEA members may be retired but we remain active retirees by being knowledgeable and providing our input into key retiree programs.

Advocacy Beyond the Elections

Good advocacy depends on strong relationships. As our newly elected legislators take office, RPEA will take a proactive strategy to approach them as they begin their new job. Once the new legislature convenes, advocacy-and educating legislators-continues in earnest.

Please work with us in letting your legislators know what is important to you.

What are they saying - National and State?

Proposal calls for cutting deficits by raising retirement age and cutting Social Security increases

The bipartisan Deficit Commission launched a daring assault on mushrooming federal deficits on November 10, proposing reducing annual cost-of-living increases for Social Security, gradually raising the retirement age to 69 and taking aim at popular tax breaks such as the mortgage interest deduction.

As part of a proposal to wrestle $1-trillion-plus deficits under control, their plan would also curb the growth of Medicare.

The Deficit Commission is unlikely to agree on a comprehensive plan to cure the nation's finances, but could lay the groundwork for smaller steps, according to those familiar with the panel's work.

Proposal Requiring Employee Share of Health Insurance in Municipalities and School Districts Could Save $1 Billion a Year, Rockefeller Institute Report Says

November 8, 2010
"A significant - and growing - portion of New York State's financial assistance for local governments and school districts pays for local employee and retiree health insurance premiums," Rockefeller Institute Senior Fellow Carol O'Cleireacain writes in the report, "Health Insurance Cost Sharing: New York State's Model for Localities."

The report outlines two ideas for increasing local employee contributions to health insurance premiums. Each would initially save the state's local governments in the neighborhood of $1.2 billion - $1.8 billion annually, savings that will grow over time with the pace of health insurance premiums.
Those ideas are:

• Alternative 1: The state requires all public employees to make at least the same contributions as those already required for state employees and retirees enrolled in the New York State Health Insurance Plan (NYSHIP).This alternative would permit local choice and options for coverage. The requirement could be phased in over several years to allow employees to make adjustments for the corresponding reduction in their take-home pay.

• Alternative 2: The state requires all public employers to join NYSHIP and adopt the same contribution rates already required for New York State employees and retirees enrolled in NYSHIP.This approach would allow NYSHIP to reduce costs through greater economies of scale and enhanced market power, while also addressing a second problem - a lack of transparency in local-government employee and retiree pay.

Current retirees should not be affected by the proposed health insurance mandate, the report states, as it could generate real hardship for those who have planned for a certain income over the full duration of their retirement. "It is fair and realistic, however, to require changes in policy toward future retirees," the report says.

For a full copy of the report, visit www.rockinst.org.

Pension Fund Reports 8% Return

New York's pension fund for public workers reported on November 9, an 8 percent return on investment in its latest quarter to a market value of nearly $133 billion.

The Common Retirement Fund for almost 680,000 employees and about 375,000 retirees and beneficiaries rebounded from the previous quarter, when it reported a loss to about $125 billion.

Comptroller Thomas DiNapoli, elected last week to a new term, said recent strength in the stock market, despite some volatility, boosted the Sept. 30 results.

The fund has almost 39 percent of its assets in domestic equities and about 16 percent in international equities, with another 27 percent in cash and bonds and the rest divided among private equity, real estate, hedge funds and other investments.

"Last year's record returns are holding," DiNapoli said. "Our commitment to long-term, value investing through our diversified portfolio has kept the fund secure and well positioned to benefit from the markets' continued recovery."

The 10 Worst States for Retirement

 What makes places a potential disaster for retirees?

November 8, 2010 
The original article can be found at MoneyRates.com: "10 worst states for retirement."  
  
There are several personal choices that make some places more attractive than others -- where your children and grandchildren live is probably at the top. But there are some more objective and measurable factors that determine whether a state is a good or a bad place for retirees. The following are the factors that used to determine the ten worst states for retirement:

• Economic factors. Using a combination of cost of living in major metropolitan areas, unemployment and tax burden, MoneyRates.com rated the 50 states from best to worst according to economic conditions.
• Climate. Americans tend to set the thermostat at around 68 degrees. So, MoneyRates.com used this as the standard, and rated states according to how far their monthly temperatures varied from 68 degrees.
• Crime rate. Security is a particular concern for senior citizens, so violent and property crime rates were used to rank the safety of the state.
• Life expectancy. States conducive to long lives are naturally well-suited for retirees.

For frequently updated data, such as unemployment, the most recently available monthly figures were used, whereas for other criteria that reflect longer-term trends, such as climate, more historical information was used.
Based on the criteria stated above, the following are the ten worst states for retirement, with No. 1 being the worst. Since just about every state has at least something going for it, we highlight both the good and the bad, so you can decide which factors would matter most to you.
10. Arkansas Reason for low rank:Unemployment isn't bad, the climate is good and the cost of living is excellent. However, Arkansas is done in by relatively high crime rates and tax burdens, and life expectancy is the eighth-worst in the nation.
9. Missouri Reason for low rank: Except for a low cost of living, Missouri doesn't stand out in any category, but a relatively high crime rate and a relatively low life expectancy make it a somewhat unwelcoming environment for retirees.
8. North Carolina Reason for low rank:The climate is very temperate, but North Carolina rates poorly on the basis of crime rate, unemployment and life expectancy.
7. Ohio Reason for low rank:Ohio is fairly average on most criteria, but both the unemployment rate and the tax burden are in the double-digits.
6. Tennessee Reason for low rank: Tennessee is a cheap place to live, with a low cost of living and average tax burden, but this doesn't make up for being one of the worst states for crime and life expectancy.

5. Maryland Reason for low rank:Between the cost of living and the tax burden, Maryland is expensive, and the high rate of violent crime is also troubling.
4. South Carolina Reason for low rank:You can find things to like in South Carolina -- the pleasant climate, for example -- but the high crime rates would be enough to scare off many retirees, and the life expectancy (one of the lowest in the nation) is a downside.
3. Alaska Reason for low rank:The nation's lowest tax burden is more than offset by the high cost of living, and the harsh climate and high rate of violent crime are not friendly to retirees.
2. Michigan Reason for low rank: The high unemployment rate is indicative of a severely damaged economy, the climate is a little rough, and the violent crime rate is a concern.
1. Nevada Reason for low rank: Nevada has the second lowest tax rate in the country, but scored poorly on just about every other criterion. Gambling enthusiasts may disagree, but high crime rates and a dismal economy make Nevada a bad bet for retirees.