FOX44NOW.COM - Burlington/Plattsburgh News, Weather and SportsNew VT Teacher Pension System Proposed

New VT Teacher Pension System Proposed

Legislators joined leaders of the Vermont National Education Association Friday to announce a proposal that, they say, would maintain teacher's benefits while saving the state millions of dollars.

The Vermont NEA and the state treasurer say they've come up with a way to offset the budget shortfall in the teacher retirement system. Right now, 3.4% of most teachers' salaries goes towards their retirement benefits. The proposal asks teachers to pay 5%. 

"The net increases about one percent and in return the capacity to increase pensions by up to $2,000 a year," Joel Cook, the Executive Director of VT NEA, said.

Currently, teachers can retire after age 62, or after 30 years of service. The new proposal would raise the retirement age to 65 unless the teachers meet the so called rule of 90. That means if a teacher had 30 years of service, he or she would have to be 60 years old to draw their full retirement benefit.

In exchange for working longer and paying more towards their benefits, retired teachers would be able to receive 60% of their final salary, instead of half; all while saving taxpayers millions.

State Treasurer Jeb Spaulding says, "We are able to provide taxpayers with a substantial savings right away, $15 million plus in year one.

A spokesperson for Governor Douglas says, while the proposal is a step in the right direction it's about $10 million less than what was previously suggested by the retirement commissions. That means legislators would have to cut from other areas of government.

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