Government retirees to get boost in pension checks
Published: July 9, 2011
Font size: [A] [A] [A]
ST. THOMAS - Just more than 6,000 government retirees will receive a 1.5 percent larger pension check starting July 31, under a cost-of-living adjustment approved Friday by V.I. Government Employees Retirement System trustees.
To qualify for the increase, retirees must be at least 60 years old and have been receiving annuities checks for at least one year. The 245 people who receive disability payments also will get the 1.5 percent increase, but their boost will arrive one pay period earlier, on Friday, system officials said.
The one-year increase will cost the GERS an estimated $2.1 million, Administrator Austin Nibbs said. Given that the system's May expenses were $8.08 million more than its revenues, and that more cash-flow problems are expected to come as a result of the Economic Stability Act's retirement incentives and pay cut provisions, Nibbs strongly recommended against granting the increase.
Last October, the federal Social Security Administration announced that more than 58 million Americans who receive monthly Social Security and Supplemental Security Income benefits would not receive a cost-of-living adjustment, or COLA, in 2011. The Social Security Act says a COLA can be granted only if the government finds there has been an increase in the consumer price index for urban wage earners and clerical workers since the last time a COLA was determined. When the federal government was determining whether it should grant a 2011 COLA, the Bureau of Labor Statistics found there had been no consumer price index increase between the third quarter of 2010 and the third quarter of 2008, which was the last time an adjustment was set. It marked the second year in a row of no COLA for Social Security recipients, according to the Social Security Administration.
Being reminded of the federal decision was not enough to sway the local system's trustees, who argued that the cost of living in the territory has grown since last year and that retirees deserved a boost.
"Yes, it's difficult for us, but that increment - most of the retirees really look forward to it," Chairman Raymond James said.
In other business, the trustees agreed the system should serve as lead plaintiff in a litigation case against BJ's Wholesale Club. Nibbs said the system currently owns about 11,800 shares of common stock in the company, and the owners are trying to sell it at a cost that is $3 to $7 less per share than what the stock would command on the open market.
The lawsuit, General Counsel Cathy Smith said, is seeking to prevent this from happening.
"It's going to stop that, and it's going to ask them to go to the open market to get the best value for shareholders," Smith said.
After meeting in executive session, the trustees announced that they had chosen finalists in their search to fill several five-year contract positions. All the companies under consideration are based on the mainland, Nibbs said.
The finalists for the role of investment consultant include Dehab Associates, Meketa Investment Group, Gray and Company, UBS and Segal Advisors, Nibbs said. Segal Advisors is the company currently in the investment consultation role, Nibbs said.
The trustees picked three finalists for its actuarial contract: Hay Group, Gabriel Roeder Smith and Segal Company, Nibbs said. Again, Segal is the company currently in the actuarial role, he said.
The trustees also selected two finalists - Corry Capital Advisors and Houlihan Lokey - for an investment valuation consultant position, Nibbs said.
- Contact reporter Karen Hollish at 774-8772 ext. 304 or email email@example.com.