June 15, 2023
NCRGEA continues its work to advance, promote, and protect the benefits, interests, and well-being of North Carolina’s retired state and local public servants in the Lake Case. Click the video at left to hear a report from ABC11 News in Raleigh.
As Executive Director Tim O’Connell explains in this video: “To take care of them in the retirement years, based upon a contractual promise, is being a good steward for North Carolina.”
NCRGEA opposes Senate Bill 743.
By Tim O’Connell, Executive Director of North Carolina Retired Governmental Employees’ Association | March 30, 2023
On behalf of our association’s close to 66,000 members, we want to thank the efforts of both the executive branch and our House legislative leadership for including a 2 percent recurring cost of living adjustment for state government retirees and retired educators. If fully approved, the recurring adjustment will be distributed one percent per biennium year. Government retirees are the unsung heroes of our North Carolina, building a state that remains prosperous, safe, clean, and desirable for families to lead healthy, high-quality lives.
Today, the State House of the North Carolina General Assembly released its anticipated budget, an almost $30 billion budget providing raises for active state government employees and educators and rainy day funds to protect against our challenging, unbridled current inflationary economic environment.
While we have made tremendous progress, we at the NCRGEA will continue to fight for these dedicated women and men, both our local and state government retirees and stay a resource for executive and legislative leadership in providing this most critical relief.
Our elected officials recognized the plight of retirees and have also provided raises to help our future retirees have a better quality of life in retirement.
Tim O’Connell, Executive Director, North Carolina Retired Governmental Employees Association – March 9, 2023
More than 320,000 local and state government retirees are drowning in inflation. With a likely probability of another multi-billion-dollar surplus for the state, it’s time to do the right thing and provide inflation-fighting cost-of-living adjustments for these dedicated women and men.
The fact that everything costs more today is common knowledge. Over the past decade, individual purchasing power has declined by 29 percent. The basket of basic goods bought 10 years ago for $100 now costs $129. During this same period, cost-of-living adjustments totaled just 2 percent for state retirees and less than 1 percent for local government retirees.
This widening gap of lack of cost-of-living adjustments related to inflation hurts not only the retirees but the entire North Carolina economy. This is particularly true in North Carolina’s rural counties, where a higher percentage of retired public servants live compared to urban counties.
And yet retirees are good for the state’s economy. The National Institute of Retirement Security reports that in North Carolina, public pensioners support more than 49,477 jobs across all 100 counties and across a breadth of industries, from hospitality to healthcare to real estate. The value of this to the North Carolina economy is $8.1 billion a year and excludes the $1.2 billion this group pays in taxes to the state and federal government. The continued stagnation of cost-of-living adjustments will reduce this impact if not addressed.
While retirees remain grateful for the one-time bonuses the North Carolina General Assembly and Retirement System Trustees have provided over the past decade, such appreciated efforts will not abate the issue of short and long-term inflation. With the average retirement payment of approximately $1,650 monthly for retired public servants and the current 29 percent reduction in buying power adjusted for inflation, North Carolina has not seen this significant disparity in nearly 50 years.
Public sector retirees are forced to make hard decisions at the grocery store and at the pharmacy, and some struggle to maintain their own homes. Governmental retirees are our neighbors, friends, and parents. They educated our children, maintained our roads, cared for our loved ones, provided our families with clean drinking water, and were the first responders who put in long and often dangerous hours to keep our communities safe.
As we look at ways to bolster the resiliency of the North Carolina economy, serious consideration must be given to how it can be done in a way that provides dignity and quality of life to governmental retirees. As our legislators and elected officials make decisions in what is projected as another year of surplus revenues, they cannot forget our retired public servants.
NCRGEA Partners with FastDemocracy
In an exciting new development, NCRGEA has partnered with FastDemocracy to offer members the ability to follow the Association’s advocacy efforts and what is happening in the North Carolina legislature. Pensions, retiree healthcare, broadband — any issue that is a priority to our members will be tracked and then shared on our website for you to see.
Both pages are located under the Advocacy section in the NCRGEA website‘s dropdown menu.
NCRGEA is committed to representing its members and empowering them with the tools needed to advocate effectively for their retirement needs. We will continue to explore technology and any other tools needed to bring us all together in pursuit of a common goal — protecting you in retirement after a lifetime of dedicated public service.
Raleigh, October 20, 2022 — Tim O’Connell, Executive Director of the North Carolina Retired Governmental Employees’ Association, announced today that the United States Supreme Court has denied the Petition filed by the State of North Carolina seeking review of the North Carolina Supreme Court decision affirming a partial judgment in favor of retired State employees seeking promised health care benefits.
This past March, the NC Supreme Court ruled that a vested State retiree is contractually entitled to the same retiree health care benefits that were in place at the time they vested. The NC Supreme Court ruling sends the case back to the North Carolina Superior Court for a determination of whether the State’s actions in reducing benefits was a material breach of the contract and if so, a determination of damages.
“It is time for this case to be resolved,” O’Connell stated. “Our retirees have been waiting over ten years to receive the benefits the State promised them when they became employed. I urge the State to stop delaying and do the right thing for these retirees who relied on the State’s promises.”
The case was filed in Gaston Superior Court in 2012 after the North Carolina General Assembly reduced the benefits retirees would receive in the nonpremium contributory plan. The Superior Court granted a partial summary judgment for the retirees and reserved ruling on the amount of damages.
“This case has been up and down in the trial court and appellate courts for almost 11 years,” stated Chris Whelchel of the Gastonia law firm Gray, Layton, Kersh, Solomon, Furr and Smith, one of counsel for the retirees. “We are prepared to move on with this case to make sure these retirees receive what the courts have said they deserve. Many of the 220,000 retirees affected by this case have died waiting for justice to be served.”
At the November district conferences, lobbyist Jack Cozort shared information on the case with members. You may view it below.
We know that many members of the Association remain interested in the Lake Case and its related current developments.
Here is a condensed history of the case: In 2011, the General Assembly reduced the standard health plan for State retirees from a noncontributory 80/20 plan to a 70/30. Twenty-eight retirees, led by former Supreme Court Chief Justice I. Beverly Lake, Jr., filed suit in 2012 to preserve and protect state retirees’ health care benefits.
Over the last ten years, the State of North Carolina asserted a variety of procedural and substantive defenses to test the merits of the case. In 2016, the Superior Court Judge presiding over the case certified the case as a class action, affecting some 220,000 state retirees who had vested benefits as of 2011.
The Superior Court Judge ruled that the plaintiff retirees were entitled to judgment against the State. The Judge’s Order specified that damages would be assessed after hearing expert witness evidence.
The State appealed, and a cumbersome appellate process ensued. In October of 2021, the case finally was heard in the North Carolina Supreme Court for a decision on the merits of the case. On March 11 of this year, the Supreme Court held that state retirees do have enforceable contract rights. The Court held that each retiree in the
class is entitled for life to the noncontributory health care benefits offered by the state at the time that retiree vested in retirement health care benefits. Those benefits are a part of that retiree’s contract with the State.
The Supreme Court sent the case back to the Superior Court for a determination of how much in damages each retiree should receive. In other words, what are the extra costs each incurred as a result of the 2011 action of the General Assembly?
Each side will hire experts, actuaries, to determine what those damages are and present evidence to the Superior Court. It will take several months for any more specific information to be available from the Superior Court. It should be stressed that this case covers only State government retirees, not local government.
On June 9, 2022, the State of North Carolina filed a petition for Writ of Certiorari with the United States Supreme Court requesting that the U. S. Supreme Court consider an appeal of the North Carolina Supreme Court’s decision. The Plaintiffs’ response is due on August 15, 2022.
