Lawmakers introduce slew of bills giving most feds a 3.9 COLA increase

Editor’s Note: This story has been updated to reflect that the Warren-Duckworth bill would give retirees a one-time cost-of-living adjustment of $581, or a 3.9 percent increase of the average Social Security benefit.

A House lawmaker has joined forces with Sen. Elizabeth Warren (D-Mass.) on a bill that would give federal and military retirees a one-time cost-of-living adjustment in 2016 equal to a 3.9 percent increase for most recipients.

Rep. Tammy Duckworth (D-Ill.) on Dec. 1 introduced a companion bill to Warren’s legislation that would give federal retirees and Americans receiving Social Security benefits a one-time payment in 2016 equal to a 3.9 percent increase of the average Social Security payment.

The Social Security Administration announced in October that federal and military retirees would receive no COLA in 2016, at a time when Medicare costs were expected to rise.

It would be only the third time in 40 years the federal government would not pay out a COLA. All three times have been before 2010.

Duckworth, a service-disabled veteran who served in Iraq, blamed Congress for doing too little to intervene on behalf of millions of Social Security recipients.

Tammy Duckworth
Rep. Tammy Duckworth (D-Ill.) introduced a bill Dec. 1 that would give feds a 3.9 percent cost-of-living adjustment for 2016.

“Veterans know not to leave anyone behind but without congressional action that’s exactly what our government will do to them — as well as millions of seniors and people with disabilities — at the end of the year,” Duckworth said. “I’m proud to work with Senator Warren to ensure seniors and those who have sacrificed for our nation receive the respect and support they deserve.”

Duckworth serves as a member of the House Armed Services and Oversight and Government Affairs committees.

Warren’s Senate bill, the SAVE Benefits Act, originally proposed the one-time, lump-sum payment of $581 in 2016, which is equal to 3.9 percent of the average Social Security benefit. The plan would affect the 70 million Americans who receive benefits from SSA. It would also close a tax loophole that allows corporations to write off executive bonuses as business expenses.

“If we do nothing, on Jan. 1, more than 70 million seniors, veterans, and other Americans won’t get an extra dime in much-needed Social Security and other benefits. And while Congress sits on its hands and pretends that there’s nothing we can do, taxpayers will keep right on subsidizing billions of dollars’ worth of bonuses for highly paid CEOs,” Warren said when introducing her bill in November. “Giving seniors a little help with their Social Security and stitching up corporate tax write-offs isn’t just about economics; it’s about our values. Congress should pass the SAVE Benefits Act today to give a boost to millions of Americans who have earned it.”

Social Security beneficiaries received a 1.7 percent COLA increase in 2015, and a 1.5 percent increase in 2014. The proposed COLA increase would most closely the 3.6 percent boost given in 2012.

The Warren-Duckworth bill is just the latest in a series of measures that address the current lack of COLA in 2016.

Another bill, introduced Dec. 1 by Reps. Frank Guinta (R-N.H.) and Kyrsten Sinema (D-Ariz.) would give Social Security recipients and retirees a one-time 1 percent COLA increase. Both are members of the House Financial Services Committee.

“This bipartisan legislation is a commonsense, fiscally responsible solution that helps seniors keep up with the rising cost of food, energy, prescription drugs, and housing,” Sinema said.

Currently, SSA determines the COLA through the Consumer Price Index for Urban Wage Earners and Clerical Workers, or CPI-W, a broad index of consumer prices tracked by the Bureau of Labor Statistics. This year’s lower gas prices factored heavily in this year’s COLA decision.

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One-third of Social Security recipients, Guinta said, rely on benefits for 90 percent of their total income. SSA recommends that retirees plan on making Social Security benefits only 40 percent of their income.

Guinta called on SSA to change the formula that determines COLA increases.

“We’re also asking heads of relevant federal agencies to present a formula that better reflects Social Security beneficiaries’ economic conditions, so more feel a sense of real financial security,” he said. “Past generations of Americans have worked hard and paid into this fund. We should do our best to keep our promise to them.”

Rep. Alan Grayson (D-Fla.) on Nov. 16 introduced his own SAVE Benefits Act companion bill, which also calls for a 3.9 percent increase for the average Social Security benefit in 2016.

This is Grayson’s second COLA increase bill in as many months. Grayson’s first bill, the Seniors Deserve a Raise Act, would have given retirees a 2.9 COLA for 2016. It would have also based all future COLA increases on the Consumer Price Index for the Elderly, or CPI-E, a formula based more on the price of items that seniors buy, such as prescription drugs, and medical expenses.

“We have been using the wrong system to determine their Cost of Living Adjustments,” Grayson said in announcing his latest bill. “Giving our seniors and veterans a 3.9 percent raise, the average raise CEOs at the top 350 American companies got last year, is an important step to righting this wrong. It will also help our economy, as it puts money into the hands of people who will spend it.”

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