BY EARL ARAKAKI – During his years in Congress, Governor Abercrombie was paid his State Of Hawaii Employees Retirement System (ERS) pension and had state health plan benefits for his legislative service to Hawaii. He presently gets his federal pension and superior congressional health plan while being paid as Hawaii’s Governor which will give him a even higher ERS pension. All rightfully earned. But how dare Governor Abercrombie imply that pensioners are selfish geezers as stated in “Pension tax would end preferential treatment.” (Honolulu Star-Advertiser, Feb. 6, 2011)
In his State of the State address he explicitly communicated state and county retirees are mooching off taxpayers saying as a state retiree “he did not earn” his federal Medicare Part-B reimbursement as he proposed to “end the current practice of state-funded reimbursement for federal Medicare Part-B for Hawaii government employees…” calling it a “bonus paid for by taxpayers.” (Gov’s state of the state speech, Jan. 25, 2011)
Abercrombie believes he “did not earn it.” However, a multitude of other retirees certainly earned it during the most productive years of their lives. Not a “bonus” as Abercrombie put a preferential treatment spin on it but truly as an accrued benefit. ERS members are forced to purchase Medicare Part-B or lose medical coverage. This results in a substantial savings to taxpayers even with reimbursement.
Gov. Abercrombie wants “everyone pay their fair share,” as he alienates retirees who moved to Hawaii writing “I have no problem with people who choose to move to Hawaii to retire…but it is not right for wealthy retirees to pay no state taxes on the pension part of their income while others–people who work in Hawaii and retirees with non-pension income–pay their state taxes.” (Island Voices, Hon. Star-Advertiser, Feb. 6, 2011)
All retirees, locals and transplants (who are not all wealthy as Abercrombie leads you to believe) contribute to the economy with minimal use of state taxpayer funded programs. All of Hawaii’s pensioners pay some of the highest taxes in the country on a fixed income. Retirees do not receive negotiated pay raises almost every year.
Without an increase in our income we have been subject to: GET increase to pay for rail, property tax increases to pay for city government pay raises, vehicle weight fee increases (30% from the city last year and double the state fee likely this year), sewer fee increases with a yet to be announced fee hike to pay for a federal mandated improvements, electricity rate hikes (highest in the country), gas taxes raised every year either city or state or both.
Where would the Governor have us cut to include a new tax on our pensions? Unlike the government we cannot force anyone to pay us more. We still have many of the same expenses we have always had. Like have mortgages, car payments, car repairs, utilities, college tuition payments (from the second mortgage we took out to get our kids through school), food, insurance, veternary bills (our dogs and cats are older too) and yes, governor, taxes.
Over and over again the governor tries to make is seem like pensioners making $75,000 a year for joint returns or $37,500 a year for single filers are “wealthier pensioners”. Nothing could be further from the truth. With the high cost of living in Hawaii and the expenses listed above, few pensioners feel rich making these amounts.
Governor Abercrombie gets 3 pensions (state, federal and social security) maybe he thinks he is getting too much but the rest of us are on one pension and sometimes but not always, social security. Also there is a lot of confusion about when the tax starts to kick in.
Under House bill 1092 and Senate bill 1319 as proposed by the Governor, the taxes as have a 3 year phase in period but after that if you reach the threshold it taxes all of the money (including all income sources) up to that amount and above. A lot of people seem to think that the first $37,500 and $75,000 are exempt, not so, read the bills.
Pensioners are good community citizens. Many babysit their grandkids so the parents can both work to pay the high expenses and high taxes in Hawaii and we don’t want to see them move to the mainland. During the day we watch the neighborhood for the thieves, who do you think calls the police to make the reports? We don’t use much in the way of city or state services and certainly pay our fair share of what we do use. We sit on the neighborhood boards and volunteer our time to help other seniors.
If the Governor truly wanted to end “preferential” tax treatment he should start with himself and other legislators. The Gov., Mayors, Legislators, receive 3.5% credit per year factored into their retirement calculations for part-time work and eligible to retire after 10 years. Judges also receive 3.5% retirement credit each year served and are all are vested after only 10 years (a judges term is 10 years).
Police/firefighters get 2.5% and are vested after 25 years. Teachers, clerks, laborers, and other government professionals get 2% credit per year and are vested after 25 years. All have to reach age 55 to collect. With such a huge disparity and with the Employee Retirement System going unfunded, the Governor should set the example and change himself, legislators and judges to 2% to show solidarity with the teachers.
Governor Abercrombie, please don’t throw us out of the canoe and into the water just because our best paddling days are behind us. We still contribute to the community.
Earl Arakaki is a retired police officer living in Ewa.