Maryland?s teachers and state employees will get better retirement pensions thanks to $120 million in improvements signed into law Tuesday.
Gov. Robert Ehrlich signed the pension improvement bill along with dozens of other measures in a State House ceremony. The pension bill allows people hired after 1998 to retire with 54 percent of their pre-retirement income, up from about 42 percent.
“We?re very, very much pleased,” said Ron Bailey, executive director of Council 92 of the American Federation of State, County and Municipal Employees that represents Maryland state workers. “The governor?s made a lot of bad first steps with his vetoes.”
Bailey said the improved pension benefits could help retain younger state workers and encourage them to work longer.
The new law calls for the workers to contribute more money toward their retirement, from 2 percent to 5 percent over three years. It raises the multiplier, or the percentage of the average salary that is paid for each year of service, from 1.4 percent to 1.8 percent. That means monthly payments to retirees would go up.
Lt. Gov. Michael Steele attended the bill signing and said the pension bill has been long overdue for Maryland?s teachers and state employees. Steele said he?d like to see even more improvements passed in coming years.
“We?ve got more to do. We?re 49th in the country in teacher pensions. It?s unacceptable,” Steele said.
? The Associated Press contributed to this report.
