An Act to Protect State Retiree Pensions from Inflation
Maine Legislature, Session 132, LD 0900
Sponsors: BALDACCI
Amends: 5 MRSA §17806

Legislative Document
No. 900
S.P. 389
In Senate, March 11, 2025
An Act to Protect State Retiree Pensions from Inflation
Received by the Secretary of the Senate on March 5, 2025.  Referred to the Committee on 
Labor pursuant to Joint Rule 308.2 and ordered printed.
DAREK M. GRANT
Secretary of the Senate
Presented by Senator BALDACCI of Penobscot.
Cosponsored by Senator: BEEBE-CENTER of Knox.
Be it enacted by the People of the State of Maine as follows:
Sec. 1.  5 MRSA §17806, sub-§1, ¶A, as amended by PL 2021, c. 635, Pt. NN, §1, 
is further amended to read:
A.  Except as provided in paragraphs A‑1, A‑2 and, A‑3 and A-4, whenever there is a 
percentage increase in the Consumer Price Index from July 1st to June 30th, the board 
shall automatically make an equal percentage increase in retirement benefits, beginning 
in September, up to a maximum annual increase of 3%. Beginning July 1, 2028, 
whenever there is a percentage increase in the Consumer Price Index from July 1st to 
June 30th, the board shall automatically make an equal percentage increase in 
retirement benefits, beginning in September, up to a maximum annual increase of 5%. 
Effective July 1, 2011, the increase applies to that portion of the retirement benefit up 
to $20,000, which and that amount must be indexed in subsequent years by the same 
percentage adjustments granted under this section.  Effective July 1, 2022, the increase 
applies to that portion of the retirement benefit up to $24,186.25, which and that 
amount must be indexed in subsequent years by the same percentage adjustments 
granted under this section. Effective July 1, 2026, the increase applies to that portion 
of the retirement benefit up to $40,000. Effective July 1, 2028, the increase applies to 
that portion of the retirement benefit up to $50,000, and that amount must be indexed 
in subsequent years by the same percentage adjustments granted under this section.
Sec. 2.  5 MRSA §17806, sub-§1, ¶A-4 is enacted to read:
A-4.  For cost-of-living adjustments awarded in fiscal year 2026-27 only, whenever 
there is a percentage increase in the Consumer Price Index from July 1st to June 30th, 
the board shall automatically make an equal percentage increase in retirement benefits, 
beginning in September, up to a maximum annual increase of 4%. The increase applies 
to that portion of the retirement benefit that would otherwise be subject to an increase 
under paragraph A.
SUMMARY
This bill provides that for fiscal year 2026-27, the Board of Trustees of the Maine 
Public Employees Retirement System, whenever there is a percentage increase in the 
Consumer Price Index from July 1st to June 30th, must automatically make an equal 
percentage increase in retirement benefits up to a maximum annual increase of 4%. 
Beginning in fiscal year 2028-29, the board must automatically make an equal percentage 
increase up to a maximum annual increase of 5%. The bill provides that, effective July 1, 
2026, cost-of-living increases for retired state employees and teachers and their 
beneficiaries apply to the first $40,000 of the retirement benefit. Effective July 1, 2028, the 
cost-of-living increases for retired state employees and teachers and their beneficiaries 
apply to the first $50,000 of the retirement benefit and must be increased in subsequent 
years by the same percentage adjustment.