NC House Includes 2% COLA for State Retirees in 2023 Biennium Budget

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.

Letter to the Editor | State government retirees drowning in inflation

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.

Treasurer Folwell Announces New Third-Party Administrator for the State Health Plan

Wednesday, January 4, 2023

North Carolina’s Treasurer announced on Wednesday, January 4 the award of the Third-Party Administrative (TPA) Services Contract to Aetna. Blue Cross and Blue Shield of North Carolina (Blue Cross NC) is the current TPA for the Plan and has been the TPA for more than 40 years.

The three-year initial service period for the contract begins January 1, 2025, and continues through December 31, 2027, with the option to renew for two, one-year terms.

This change will not impact our members who are enrolled in the Humana Group Medicare Advantage Plans. It will only impact members on the Base PPO Plan (70/30) and the Enhanced PPO Plan (80/20) which are currently being administered by Blue Cross NC.

Plan members will start receiving more information regarding the changes in 2024 prior to our Open Enrollment Period for the 2025 benefit year.

The administrative contract, awarded by the State Health Plan Board of Trustees, oversees health care spending of more than $17.5 billion over five years. The new contract reflects a partnership that focuses on transparency and lower costs, with the potential administrative cost savings over the course of the contract equaling $140 million. 

The award is the result of a Request for Proposals, a competitive bid process in which the Plan solicited and selected industry-leading partners providing exceptional customer service, technological resources and professional support. The services under the contract include processing claims and offering a comprehensive network of health care providers.  Aetna was one of three companies bidding for the contract. Blue Cross NC and UMR, Inc. also submitted proposals.

The State Health Plan, a division of the Department of State Treasurer, provides health care coverage to nearly 740,000 teachers, state employees, retirees, current and former lawmakers, state university and community college personnel, and their dependents.

NCRGEA Executive Director Quoted in Op-Ed Article About Current Shortage of Public Servants

“They can’t keep people”: There’s a critical shortage of public employees in NC

News & Observer, December 1, 2022, by Ned Barnett

Callers to the Social Security office are put on a seemingly endless hold.

Callers to a state Department of Motor Vehicles office in Raleigh often get the message: “Your called party is temporarily unavailable. Please try again later.”

Cities and towns across the nation have closed city pools for lack of lifeguards, while school systems are canceling bus pickups for lack of drivers.

The COVID pandemic has aggravated a worker shortage across the U.S. economy, but it’s hitting public employees especially hard.

“At the local level, governments are pulling out all the stops to get people,” said Leisha DeHart-Davis, a professor of public administration and government at the UNC School of Government. “The status quo no longer works for retaining and securing people.”

A UNC survey of local government employees found that 23 percent of them were planning to leave their job, up from 15 percent before the pandemic.

The pandemic’s disruptions and rising private sector wages have accelerated the loss of government workers, but the roots of the problem go deeper. Republicans have been pushing back against the value of public employees at least since President Ronald Reagan fired 11,000 striking air traffic controllers in 1981. Benefits have been pared back, pensions have lost ground to inflation and fewer young people are drawn to public service.

In North Carolina, legislation passed in 2017 eliminated retiree health benefits for state employees and teachers hired after 2020. Meanwhile in the past 10 years, retired state employees’ cost of living allowance (COLA) totaled only 2% and Local Government Employee’s COLA in the same period has increased by less than 1%.

“Things have just been rolled back,” said Tim O’Connell, executive director of the N.C. Retired Governmental Employees’ Association. “The promise of what a pension would deliver upon retirement is not there the way it was for folks who retired 20 or 30 years ago.”

As benefits shrink and private sector wages rise, the state government is struggling to attract and keep workers who provide both basic and essential services.

State agencies are reporting vacancy rates as high as 20, 30 and 40 percent. DMV Commissioner Wayne Goodwin has boosted starting salaries for drivers license examiners, but it’s not enough to fill gaps.

Beyond wages, Goodwin said, his employees are burdened by filling in for missing workers and a sense that their public service is not valued. “We do hear in exit interviews that they don’t feel like they are getting respect from the public,” he said. “It can be a stressful job.”

Even at the federal level, once the gold standard for public employee pay and benefits, eroding pay, short staffing and low morale are inhibiting the delivery of services.

Valerie Langley, a 31-year Social Security Administration employee based in Charlotte, said her office’s traffic has fallen from 78 employees prior to the pandemic to 64 even as the population served has increased sharply. “They can’t keep people,” she said.

The union representing Social Security employees, the American Federation of Government Employees (AFGE), said the agency nationally has 4,000 fewer field office and teleservice center employees than it did 12 years ago. Meanwhile, the number of Social Security beneficiaries has risen by 21 percent since 2010.

Langley, a union steward, said the public blames employees when the phone isn’t answered or employees are late to appointments. “That’s the stereotype – lazy government workers,” she said. “It’s honestly the exact opposite. We’re overworked and overwhelmed.”

For too long, Republican lawmakers have neglected raising wages for public employees, enhancing benefits or modernizing government workplaces. Now that neglect has converged with the Great Resignation. Elected officials all levels are going to have to answer why taxpayers seeking services are instead getting busy signals, long lines and extended delays.

Reposted with permission from Associate Opinion Editor Ned Barnett. Read more at:

Donate Locally for Giving Tuesday, November 29, 2022

Tomorrow is GivingTuesday 2022, which means many of you will be donating to a nonprofit or community organization.

We encourage you to donate to groups here in North Carolina. In your community, check for specific information on #GivingTuesday or contact an organization to inquire about donating.

Otherwise, you can explore some of the North Carolina initiatives we discovered online.

◾️Giving Tuesday Raleigh Durham – scroll down to see the seven local nonprofits on which they are focusing this year. –

◾️ Cumberland Community Foundation, Inc. – lists 76 local nonprofits in the area. Choose one and click the Donate button beside its name.

◾️Conservation Trust for North Carolina – donations will be triple matched by board members –

◾️ Farmville Public Library –

◾️ Families & Communities Rising, Durham –

◾️ Kellin Foundation, Greensboro –

◾️ Big Brothers Big Sisters of the Central Piedmont –

◾️ Friends of Guilford County Animal Shelter –

NCRGEA Update: Statement on Lake Case, October 2022

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.