Increasing workers’ contribution to the state retirement system, while decreasing the state’s portion, will not improve the retirement fund. Gov. Paul LePage’s proposed budget will, however, provide $203 million in tax windfall primarily for the wealthiest 10 percent of Maine residents and many out-of-state corporations.

The governor’s proposal to break promises made to school employees, state employees and retirees is unconscionable. Legislators who value honesty and believe that a promise made is a promise to be kept are working to mitigate the effects of reneging on the state’s promise to its public workers.

Those who are using the “Chicken Little” approach of the “sky is falling,” refer to the worst-case scenario for the Maine Public Employees Retirement System.

MPERS, while not yet fully funded, is one of the safest public retirement systems in the United States.

The problem is with the unfunded actuarial liability, but that is not a new problem. The UAL issue began in the 1940s when the governor and the Legislature at the time recognized that teachers needed to be covered by a retirement system. Social Security did not cover them.

In one fell swoop, they were brought into the Maine State Retirement System and therefore qualified for state retirement benefits, even though no contributions had been made to that system by them or by the state on their behalf.

Public school employees have since contributed their share to the system. By the way, the state of Maine pays the employers’ contribution for all public school employees. It is not paid through local taxes.

The UAL continued to grow when governors and Legislatures over the next 40 years looked to suspending or reducing the employers’ contribution in order to balance state budgets. When this was done, the UAL grew. It was an easy place to go, when budgets were too tight. This was done under Democratic and Republican administrations.

The UAL grew even more in 1991 when the governor and his budget chief looked to balance the budget by raiding the retirement system, again with the promise of paying it back with interest. Maine citizens were so outraged about this that a constitutional amendment was proposed and passed by 70 percent of the voters. That amendment required the state to pay back all that was owed by the year 2028.

Since the amendment was passed in 1995, the state has been making its payments and reducing the UAL.

But wait, there is yet another part to this problem.

Through the years, MPERS made investments in the market, as all retirement plans do. The collapse of market investments, caused by the deep recession just experienced, increased the size of the UAL. That is where the governor’s administration, led by the same budget chief as in 1991, is not being forthright about the debt.

Like many portfolios, the one held by MPERS took quite a hit at the bottom of the latest recession, 2008-2009. But, like many portfolios, it has bounced back. Of course, MPERS has not recovered fully, but it has recovered about 57 percent and with the economy improving, albeit slowly, so is the MPERS fund balance.

Furthermore, many people are not aware that most of Maine’s public workers, qualified for coverage under MPERS, do not qualify for Social Security. Those workers who do qualify for MPERS and Social Security forfeit 60 cents of Social Security for every dollar received from MPERS.

The governor’s proposal also calls for a cost-of-living adjustment freeze for three years and a cap of 2 percent thereafter.

COLA benefits are just that — cost-of-living adjustments. They are based on the consumer price index, just as Social Security is. Like Social Security, retirees in MPERS have not received a COLA for a couple of years. But the governor wants to go beyond that by eliminating the COLA and then freezing it no matter how high the CPI goes.

That is not right and it is not fair. It is another broken promise.

The governor also wants to reduce the employer contribution and increase the employee contribution to MPERS by 2 percent in each case. The state’s share would be reduced from 5.5 percent to 3.5 percent, while the employee’s share would increase from 7.65 percent to 9.65 percent of wages earned.

So why do this?

As previously stated, it will not fix the UAL. But, it will provide money to fund the reduction of Maine taxes for its wealthiest residents by $203 million. That is the crux of the proposal.

It will again break retirement promises to Maine’s public employees and then require them to fund the governor’s promise to reduce taxes for the rich. It will do nothing to help the UAL.

Rep. Paul Gilbert (D-Jay) represents House District 87, which includes Chesterville, Jay, Mercer, New Sharon and Starks.