What with the snowfalls and the Super Bowl, you might have missed the news that Scott Brown has applied to the State Board of Retirement to begin collecting his state pension. As reported by the Globe, Fox 25 and other outlets (but not the Boston Herald, which is ordinarily vigilant on public pension matters), Brown filed his application shortly after his electoral loss in New Hampshire in November.
Here’s the squirrely part. The stories are estimating the amount of his pension to be $60,000. That’s wildly wrong on the high side. His pension will be closer to one-third of that number.
Fox 25 has helpfully shared Senator Brown’s pension application, and a handy guide on the State Board of Retirement website walks you through the math. The amount of our former Senator’s state pension will be the product of:
- The number of years of service he is claiming (Brown is claiming 16.5 years)
- Multiplied by an adjustment for his current age, (Brown is 55, the youngest age at which it is even possible for non-public safety workers to apply for pension benefits, so his age factor is .015)
- Multiplied by the highest 36 consecutive month average rate of regular compensation (Brown made between $73,200 and $76,400 during that time, so let’s eyeball that number at $74,200).
So, (16.5) x (.015) x $74,200 = $18,364 per year, considerably less than $60,000, but maybe enough to pay the property taxes on the New Hampshire homestead. Glad that’s cleared up.
If, like me, you have a nagging suspicion that Senator Brown’s pension, even at the modest number of $18,364, nevertheless involves some advantageous calculations that are not available to many of the rest of us, a couple more points.
- Senator Brown’s highest 36 months of compensation were his last three years in the State Senate, when he received an additional $15,000 (on top of the base legislator salary) for serving as Third Assistant Minority Leader. Since he was the least senior member of the minority party during that time, the $15,000 bonus he received was compensation for leading himself. Without that $15,000 bonus, his pension would be closer to $14,000.
- Most of Senator Brown’s 16.5 years of service was time he spent not on the state payroll, but as a town assessor and then selectman in his home town of Wrentham, positions which were not full-time employment and for which he received little pay (a Globe article from last year reported that many towns pay their selectmen in the range of $3000 to $5000 per year). But for the existence of a law allowing such service to be counted toward state pension eligibility, the Senator would not have the 10 years of service required to collect a pension. As it is, he will be receiving more in pension benefits than a person who worked full-time for the state for the same number of years but whose highest 36 months of salary were less than Brown earned as his party’s Third Assistant Majority Leader.
…as it is a system in need of reform, right? As far as I can tell he hasn’t asked for anything improper and only the media are mistakingly pegging it at 60K.
Senator Brown’s application appears to be in order (while taking advantage of opportunities that most of us don’t have).
I found it odd for the media to be so out of touch with the realities of retirement that the idea of a $60,000 defined benefit pension for the rest of a 55-year old’s life didn’t cause anybody to take a second look. And then there’s Herald’s radio silence on the entire matter when it’s one of their own at the proverbial trough.
Maybe that’s his excuse for not turning on one of his own. Har har.
When the hack is one of their own.
In 2005 (?) the law was changed so municipal service after 2005 would not be counted towards the state pension total. Oddly enough, the law – or budget amendment? – was proposed by a long time selectman recently elected to the House. His time counted, but after that it was not.
Bottom line – in future, municipal time will not count for state pension purposes.
Full disclosure – I had some city time from the 1970’s that was applied to my own retirement, which is in the 4-figure range.
General Laws chapter 32, section 4, subsection (o):
From this it looks like municipal service still counts will continue to count after 2009 as long as the municipal salary is $5,000 or more.
We had been speaking of selectman time.
What the change was meant to correct was situations – like Scott Brown -where a stipend of a couple hundred dollars counted the same as a year of full time employment at a salaried position.
A selectman or moderator with a stipend of only $500 paid in based on that, but was eligible to collect as if it had been a$50,000 salary. Since only the highest years count for the computation of the pension, the time served earlier for the small stipend was equivalent to a 40 hour week – without the commensurate contribution to the system.
Since MANY legislators were formerly municipal elected officials, it was a very good reform.
where long time selectman qualified for lifetime health insurance before that reform was passed.
And the benefit of this would exceed his pension. It might be the reason he is doing this ?
He is eligible to purchase health insurance, including a family plan, for the rest of his life through the Group Insurance Commission of the Commonwealth and pay 20% of the premium.
So that amount is $11K additional a year – and it’s a tax free benefit
Also his pension is exempt from MA income tax – as opposed to individuals in the private sector.
Yes, the law will correct situations where a municipal stipend under $5000 would have resulted in a year of state service countable toward a pension, but a municipal stipend of $5000 still will count. I agree with you that there ought to be a commensurate contribution to the system.
Local employees deserve a pension; $5k draws the line at crediting electeds who receive honorariums.
I wonder what type of pension or other benefits Brown receives for his stellar tenure in the US Senate.
because he wasn’t there long enough.
One other significant advantage that the “municipal service” option offers is that people who take advantage of it are also, in all likelihood, employed in jobs for which they are collecting Social Security credit. A person employed by the state for 16.5 years collects no Social Security credit for that time. Scott Brown was employed by the state for about 7 years, which means his 9.5 years of municipal service counts both toward a state pension and toward Social Security.
Police, fire, teachers, etc. don’t pay into Social Security in MA. And there is always the Offset as well.
As long as Brown honors his agreement to stay in New Hampshire.
PS Granite State: No Backsies.
While he promotes a party that wants to do away with pensions, privatize Social Security, and raise the retirement age. Yeah, that’s Scott.
that the amount of his pension was estimated to be less than $20K. The $60K figure, according to the clarification was the maximum he “could have” received.
Huh? Under what circumstances could Scott Brown have received a pension of $60K? If the law were different? If he applied for a pension three separate times and no one noticed? If he were selling mattresses in a Monty Python sketch?
I think someone at the Globe should admit their error, remove the “clarification” and issue a correction.
….the Pension Database in the Herald will have the exact amount. Then the Globe can look it up!
I assume he gets some kind of pension for his service, which I believe started in his early 20’s to help pay for college/law school. Based on your description of his MA pension application, this would be an additional stream of retirement income.
Also, let’s not forget another driver to Brown submitting is retirement now, instead of a few years later when he would be eligible for more money…at 55 he and his wife can get their health insurance from the state. That is at least a $12,000 a year benefit.
does not mention his National Guard Service. Yesterday I checked the Guard web site and it does not mention anything about pensions and creditable service but since it is a division of the Commonwealth I assume members participate in the state retirement system. Not sure either whether he still serves in the Guard.
…retired from the Guard with 35 years of service. And it appears the Guard pension is part of the US Military, with a convoluted system based on a formula that takes into account the part-time nature of the service. Bottomline is he is a (legal) double-dipper.
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