COLA Cuts in State/Local Pensions

Alicia Munnell, Jean-Pierre Aubry and Mark Cafarelli

State and Local Pension Plans Briefs from Center for Retirement Research

Abstract: The brief’s key findings are: The brief’s key findings are: *Since the financial crisis, 17 states have reduced, suspended, or eliminated cost-of-living-adjustments (COLAs) for public employee pensions. *This response was surprising as current employees and retirees tend to be legally shielded from benefit cuts. *But the COLA cuts have largely been upheld in the courts under the rationale that – unlike core benefits – they are not part of a contractual right. *In short, defined benefit promises in the public sector are not as secure as many thought.

Pages: 9 pages
Date: 2014-05
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Related works:
Journal Article: COLA cuts in state-local pensions (2016)
Chapter: COLA Cuts in State-Local Pensions (2015)
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