An Act to Decrease Offsets to Disability Retirement Benefits
Maine Legislature, Session 132, LD 2145
Committee: Labor
Sponsors: TIPPING
Amends: 5 MRSA §17906, 5 MRSA §17930, 5 MRSA §18506, 5 MRSA §18530

Legislative Document
No. 2145
S.P. 863
In Senate, January 7, 2026
An Act to Decrease Offsets to Disability Retirement Benefits
Submitted by the Maine Public Employees Retirement System pursuant to Joint Rule 203.
Reference to the Committee on Labor suggested and ordered printed.
DAREK M. GRANT
Secretary of the Senate
Presented by Senator TIPPING of Penobscot.
Be it enacted by the People of the State of Maine as follows:
Sec. 1.  5 MRSA §17906, sub-§2, ¶B, as repealed and replaced by PL 1987, c. 458, 
§1, is amended to read:
B.  Disability retirement benefits shall must be calculated as follows:
(1)  The initial disability retirement benefit shall must be reduced if necessary so 
that the benefit plus any benefits under paragraph A do not exceed 80% of the 
beneficiary's average final compensation;
(2)  Subsequent cost-of-living adjustments applied to any benefit listed under 
paragraph A shall must be excluded from the calculations under subparagraph (1);
(3)  Adjustments under section 17806 shall must be applied to that portion of 
disability retirement benefits calculated under subparagraph (1); and
(4)  If a beneficiary receives a benefit under paragraph C, the 80% limit under 
subparagraph (1) shall may not include adjustments under section 17806.
Sec. 2.  5 MRSA §17930, sub-§4, ¶B, as enacted by PL 1989, c. 409, §§8 and 12, 
is amended by amending subparagraph (1) to read:
(1)  The initial disability retirement benefit shall must be reduced if necessary so 
that the benefit plus any benefits under paragraph A do not exceed 80% of the 
person's average final compensation;
Sec. 3.  5 MRSA §18506, sub-§2, ¶A, as amended by PL 1993, c. 680, Pt. A, §17, 
is further amended to read:
A.  The amount of any disability retirement benefit payable under this article must be 
reduced by any amount received by the beneficiary for the same disability under either 
or both of the following:
(1)  The workers' compensation or similar law, except amounts that may be paid 
or payable under former Title 39, section 56‑B or Title 39‑A, section 212, 
subsection 3; or. 
(2)  The United States Social Security Act, if the employment for which creditable 
service with the employer is allowed was also covered under that Act at the date 
of disability retirement.
Sec. 4.  5 MRSA §18506, sub-§2, ¶B, as repealed and replaced by PL 1987, c. 458, 
§2, is amended to read:
B.  Disability retirement benefits shall must be calculated as follows:
(1)  The initial disability retirement benefit shall must be reduced if necessary so 
that the benefit plus any benefits under paragraph A do not exceed 80% of the 
beneficiary's average final compensation;
(2)  Subsequent cost-of-living adjustments applied to any benefit listed under 
paragraph A shall must be excluded from the calculations under subparagraph (1);
(3)  Adjustments under section 18407 shall must be applied to that portion of 
disability retirement benefits calculated under subparagraph (1); and
(4)  If a beneficiary receives a benefit under paragraph C, the 80% limit under 
subparagraph (1) shall may not include adjustments under section 18407.
Sec. 5.  5 MRSA §18530, sub-§4, ¶B, as amended by PL 2003, c. 328, §1, is further 
amended by amending subparagraph (1) to read:
(1)  The initial disability retirement benefit must be reduced if necessary so that 
the benefit plus any benefits under paragraph A do not exceed 80% of the person's 
average annual earnings.  For the purposes of this subparagraph, "average annual 
earnings" means the total of the person's average final compensation plus other 
wages and earnings from employment for the calendar year in which the person 
has the highest total of other wages and earnings from employment during the 5 
years immediately preceding the year in which the person became disabled average 
final compensation;
SUMMARY
This bill modifies provisions governing disability retirement benefits for the State 
Employee and Teacher Retirement Program and Participating Local District Retirement 
Program as follows. 
1. It increases the cap on the total combined benefits that may be paid for the same 
disability between disability retirement benefits and workers' compensation benefits.  It 
also modifies this cap under the Participating Local District Retirement Program for 
disabilities for which written applications were received after September 30, 1989 to rely 
on a person's average final compensation rather than the person's average annual earnings. 
2. It eliminates the requirement that benefits paid under the Participating Local District 
Retirement Program for disabilities for which a written application was received before 
October 1, 1989 must be offset for Social Security benefits received for the same disability. 
3. It corrects outdated language to conform with modern drafting standards.