2012 COLA (Cost of Living Adjustment for Retirees)
The Segal Company, CCCERA's actuary, presented their recommendations for the 2012 Cost of Living Adjustments (COLA) at the February 8, 2012 Retirement Board meeting. The Board voted to adopt the COLAs as determined by Segal.

• Tier 2 and Tier 3 (disability retirees only) will receive a 3.0% COLA. (There is no COLA bank remaining for these two groups.)
• Tier 1, Tier 3 (service retirement only), and Safety tier A retirees will receive 3.0%. (The COLA bank for this group of retirees is also exhausted.)
• Safety Tier C retirees will receive a 2.0% COLA.
  
  The COLA adjustment is based on the Bay Area Consumer Price Index (CPI), which varies depending on a yearly survey of the cost of goods and services. Our actuary computes the COLA based on cost comparisons between the previous two years (December of 2010 and December of 2011). The CPI can go up, down, or remain unchanged, depending on the results of this survey. Likewise, the COLA component (only) of a retiree's benefit may go up or down to reflect changes in the CPI. The COL adjustment is applied in April; the amount will be reflected in the May 1, 2012 benefit payment.
  For an explanation of the COLA Bank, please click this link to see the 2006 Spring edition of New Roads, available on this web site. To see the complete COLA rate sheet and Segal Company's discussion of the rates, please click this link.

Current Meeting Agenda CLICK HERE
Available Agenda Attachments are linked in the document by .pdf files. Click the links to open.

Agenda Archive CLICK HERE

Minutes Archive CLICK HERE

Annual Board Calendar   CLICK HERE

Next Board Meeting Dates

February 22, 2012
March 14, 2012

Board Trustees CLICK HERE

Retiree Benefit Handbook: Table of Contents Link

New Roads Newsletters

CCCERA Forms Index

Retiree Benefit Enhancements

Retiree Survivor Benefits

Safety Retiree Tax Exclusion

Special Notice: RETIREES May Need to Adjust Their Federal Income Tax Withholding for 2012

The American Recovery and Reinvestment Act of 2009 includes a tax credit designed to boost working American's take-home salary by a few dollars each pay period as part of the federal economic stimulus package. To accomplish this credit, the IRS issued new tax tables to allow slightly less withholding from pay checks, so workers could keep these dollars, which in prior years, would have been withheld for income tax. This program is called the "Making Work Pay" tax credit. The new tax tables went into effect in April 2009, and are effective for both 2010 and 2011.

What does this have to do with CCCERA Retirees?

The new income tax tables are withholding less from pension payments, too. Since the tax credit is only for employed men and women as an "earned income credit," many retirees may not be eligible for the tax credit created by decreased withholding amounts. (Pension benefits are not considered "earned income" by the IRS.) Generally, retirees who do not qualify for the tax credit are people whose sole income source is from pension benefits. These retirees may not have the correct tax amount withheld from their incomes for 2011.

What should retirees do about this change in tax withholding?

Please take some time now to estimate how much tax you will owe for 2012, especially if you have another job or if you are married and your combined income with your spouse puts you in a higher tax bracket.

If retired members verify that their current withholding amounts will cause incorrect withholding due to the new tax tables, retirees should request a Form W-4P from CCCERA, fill out any additional amounts or withholding status changes and return the form to the Retirement Office. This form is also available on this web site by clicking this link.

CCCERA cannot offer tax advice to our members. We strongly encourage retirees to consult with their personal tax advisors to make sure their withholding amounts are correct. The IRS has information and resources that can assist with calculating any additional tax amounts retirees may owe on their web site, including a withholding calculator. Click this link for the IRS home page.