Milwaukee Retired Police Association
established in 1975

Pension/Health

Metlife Dental Plan- by President Wray Young

If you are interested in dental insurance, the MPA and Local 215 Firefighters have negotiated a Metlife plan that you should take a look at. It is not cheap and not for everyone, but if you have dental needs other than just cleaning, it may be a plan that would be right for  you.  This plan has been in place for a number of years and I have not heard a negative complaint about it.  Click on the links below for plan information and enrollment form and/or call 414-220-9900 and tell Thomas or his associate that you are a member of the Milwaukee Retired Police Association and have a question about the MPA & Local 215 Firefighter’s Metlife Dental Insurance Plan. 

MRPA-Dental-Vision-2024-Review-Form

MRPA Dental 2024 Enrollment Form

Pension Fund Update- 2024

by Tom Klusman, City-wide retiree-elected Board Trustee

Hello MPD retired sisters and brothers.  The following is my bi-annual update on our pension fund.  Thank you for reading, staying engaged and keeping up-to-date on our fund; which is such an important part of our lives.

CURRENT STATUS

As of the first week of September 2024, our fund’s total value stands at just a hair over $6 Billion.  Please make a mental note of that number, as I will be referencing it again.

Outgoing monies YTD are just over $333 million, with $314.7 million of that being the eight (8) so far monthly retiree payrolls; so we’ve inched up to just over $39 million per month in retiree payroll.  The rest is the administrative expenses to run the fund and GPS payments.  

On the incoming / contributions side, we have received almost $235 million YTD in employee & employer contributions.  These days we are seeing the largest employer contributions in the history of the fund, much of that being necessary to make up for some prior bad decisions, but with the new sales tax, we do have a dedicated source of revenue for the employers to rely on to make their required contributions and keep our fund solvent.  This is Great News!

On the investment portfolio side of things, which I stay keenly aware of as Chair of our Investment Committee, things are well.  We are currently are enjoying an 6.87% return so far (YTD).  That is very good news and if you are keeping track, 6.8% is our new (much more reasonable than prior years) return assumption, as required by Act 12.  So, 2024 is going quite well for us having hit our target already and we are just approaching the 4th quarter; so keep your fingers crossed for continued success.  In dollars, this return equates to $402.5 million in Capital Market Gain (aka: additional value) for our fund so far YTD. 

2024 Annual Actuarial Valuation

As I always mention, an Annual Actuarial Valuation of our fund is required by Chapter 36 and is routinely presented to the ERS Board at its June meeting.  This year that occurred on June 25th.   The valuation reports a snapshot of our fund as of January 1st of each year, in this case 2024.  This year’s valuation determined and reported our fund’s actuarial accrued liability has risen to $7.8 Billion (from the $6.9 billion I reported in last Fall’s Newsletter).  Comparing that number to what we cited above that we ‘have in the bank’, so to say ($6 Billion) reveals a $1.8 Billion unfunded actuarially accrued liability, or UAAL (also up from last year’s $1.3 billion UAAL). 

Also, as I enjoy reporting to you each year, each year’s valuation exposes what our funded ratio is.  This year (on an actuarial basis) our funded ratio decreased to 76.7% from the 82.7% I reported last Fall.  The primary driver of this reduction was Act 12’s requirement for our fund to use a more mainstream assumed rate of return (no greater than the State pension system’s) and to cease being an outlier like it was years ago.  So, we are looking at the same money we always had, and essentially the same liabilities, just now with a more realistic assumption of what the investment markets are going to return in the future.   Finally, what all this math means is that our fund realistically has 76.7% of the money it needs to meet all its obligations. 

CITY OF MILWAUKEE SALES & USE TAX

A very brief update on the City Sales & Use Tax that 2023 Wisconsin Act 12 provided for.  As you likely know, the tax began on January 1 of this year.  Disbursements are made to the City primarily on a quarterly basis.  While we (the pension board) have been briefed on the status of those receipts, it is still too early to know exactly what the full amounts will be.  I will report back on that to you in future articles as that materializes.

Our ERS staff, for its part, has enacted all that Act 12 requires of it so far.  New hires are going into the State pension system and we (ERS) are continuing well with our ‘closed club’ of about 28,000 active and retired members.

In closing, I do look forward to seeing as many of you as possible at the meeting on September 11th which our Board has invited me to, and answering any questions you may have.

Thank You again for reading.

Sincerely,

-Tom Klusman

A Bill that would end the Windfall Elimination Provision for public pension recipients in the Social Security Program

April 15, 2022

Dear Wray,

Thank you for contacting me to share your thoughts on Social Security benefits. I appreciate you taking the time to let me know your views on this important issue.

Social Security represents a promise that the federal government has made to seniors and those who are approaching retirement age. Individuals and families have paid into this program, and they lived their lives depending on this promise. It is a promise we must keep. As Congress works to preserve this program for future generations, my top priority will be to protect those in retirement and individuals approaching retirement age.

As you know, Representative Kevin Brady (TX-8) introduced H.R. 5834 on November 3, 2021. This bill eliminates the Windfall Elimination Provision (WEP), a title of the Social Security Act that can reduce or eliminate Social Security benefits for an individual who also receives a public pension from a job not covered by Social Security. This bill would repeal the WEP and replace it with an updated benefits calculation formula, allowing for individuals who receive public pensions to also be eligible for benefits under the Social Security Act. For existing retirees, Social Security will provide a restoration of benefits payment to cover benefit loses under the WEP.  I cosponsored this legislation because I believe it appropriately addresses a shortfall of our social security system. 

Thank you again for contacting me on this important issue. I appreciate that you took the time to make me aware of your views. Please stay in touch as we continue to move Wisconsin and our nation forward. You can reach my office at 202-225-3031 or by visiting my website at Steil.house.gov.

On Wisconsin,

Bryan Steil
Representing Wisconsin’s 1st District

IRS warns some retirees at risk of tax penalty: What to know

Brittany De Lea Published September 13, 2018
The IRS has a new warning for retirees, and while it’s not about a scam it could end up costing older taxpayers more money than they expect to pay.
The agency issued a statement urging Americans to check the amount being withheld from retirement accounts and monthly pension or annuity checks, as soon as possible, in order to avoid a penalty next year.
Since the year is almost over, the IRS said those who discover they have been paying too little, might need to make a quarterly estimated or additional tax payment directly to the agency.
The Tax Cuts and Jobs Act, which enacted a slew of changes to the U.S. tax code, altered the way dues are calculated by the IRS. As such, some retirees are at risk of having too little withheld from regular payments.
Overall, more taxpayers than normal are at risk of having to pay the agency next April.
According to a simulation conducted by the Government Accountability Office (GAO) in August, which reviewed the revised federal tax withholding tables for 2018 implemented by the IRS and the Treasury Department, 21 percent of workers are at risk of having their taxes underwithheld – 3 million more than projections based on the old tax code.
Only 6 percent of taxpayers are expected to have wages accurately withheld, while 73 percent are likely to have their taxes overwithheld. The former is three percentage points less than a simulation conducted using the same withholding structure and the old tax code. Accurate withholding was assumed to be within $100 of what is truly owed.
This year, employers are using W-4 forms already on file to calculate withholding amounts, which has posed problems for taxpayers because the sweeping tax reform changes address everything from personal exemptions to the standard deduction. The Tax Cuts and Jobs Act gave the Treasury Department authority to determine the withholding allowance structure because the old method was no longer suitable, and there was not enough time to issue a new W-4.
When asked in February about how many errors the Treasury has seen so far this year, Treasury Secretary Steven Mnuchin declined to comment directly, instead urging taxpayers to use the IRS withholding calculator.
Employees can update their withholding amounts and the administration has encouraged them to use the tax calculator, available on the IRS website. Retirees can also use the tool, entering their pension like income from a job. They can also consult a financial adviser.
For Social Security tax payments, the IRS says individuals can ask the Social Security Administration to withhold taxes at specified rates ranging from 7 percent to 22 percent. Changes can be made online.
Changes to IRA withholding amounts can also typically be made online.
The Trump administration released a proposal for the new 1040 tax document, or the U.S. individual income tax return, in June. It is expected to release a new W-4 form later this year.

 

TAX DEDUCTION FOR RETIRED PUBLIC SAFETY OFFICERS

By President Wray Young

The Pension Protection Act, which was signed into law in August of 2006, allows retired public safety officers to exclude from income distributions made from their eligible retirement plan that are used to pay the premiums for health insurance.  This also includes the MetLife Dental & Vision plans negotiated for Milwaukee retiree firefighters and police.  The distribution must be made directly from the pension plan to the insurance provider.  You can exclude from income the smaller of the amount of the insurance premiums up to a maximum of $3,000 but the amount excluded cannot be used to claim a medical expense deduction. The MRPA is not qualified to give you tax advice so please direct any questions you might have regarding this benefit to your tax preparer or the IRS which, in turn, might refer you to IRS Publication 575.

 

Government Pension Offset & Windfall Elimination Provisions Will Reduce your Social Security Benefits – Wray Young

Kerry Leist, VP/Operations for NATIONAL BENEFIT CONSULTANTS, INC. passes along the following: There is important information regarding the Government Pension Offset & Windfall Elimination Provisions that will reduce your social security benefits and those of your surviving spouse if you should die before her/him.
Click to view:

Medicare Info- 2024 Information

Kerry Leist, VP/Operations for NATIONAL BENEFIT CONSULTANTS, INC. passes along the following important information regarding Medicare eligibility. Click on the following link to see more information on Medicare costs and benefits

Make sure that you have your 40 quarters/credits to be eligible for Medicare
 
There are populations of protective services and a few others that lack 40 quarters. Some of those think they do not ‘qualify ‘ for Medicare. If entitlement is not at 40 credits it will costs those folks more for Medicare unless they qualify on a spouse’s record.  Credits can be obtained through qualified employment or on a self-employment basis.

If you have any questions concerning the attached Medicare information, please contact Kerry Leist at 262-201-4370 ext. 101

 

Police Relief Association (PRA) – By:  Shannon M. Seymer-Tabaska

The Police Relief Association is a non-profit organization (501c3) whose PRA Board is elected by the membership, to include the Milwaukee Police Department Retirees Association (MPRA), the Milwaukee Police Association (MPA), and the Milwaukee Police Supervisor’s Organization (MPSO).   The current PRA Board members include: President:  Branko Stojsavljevic, Vice President: Vacant, Treasurer:  Shannon M. Seymer-Tabaska, Secretary:  Dena Klemstein, Directors:  Patrick Doyle (retired member), David Feldmeier, and Eric Pfeiffer.  In addition, the PRA Board has City Attorney Office representation under City Attorney Patrick McClain. 

To be an active member of the PRA, one must be a sworn active law enforcement officer and/or a retiree who pays monthly dues of $2.08 into the PRA fund, which includes those members approved for a duty and/or ordinary disability.  If a MPD member did not leave in good standing (i.e. termination and/or resigned) his/her PRA benefit ceases. 

At retirement, active law enforcement members have the option to “opt out” of the PRA, but the PRA Board discourages this option as the majority of members lose a $9000.00 benefit that their beneficiary is entitled to at time of death.  Once the latter “opt out” election is made, a member can’t re-enroll in the PRA.  In addition, in 1998, there was a member election regarding the $9000.00 benefit amount wherein members elected to increase their dues to receive the $9000.00 benefit, but if a member did not make the election, their entitlement is $8000.00.  There are also a few older retirees who only pay $1.25 per month into the PRA fund, so their benefit is reduced as well.

As an active member of the PRA, it is pertinent that any life change (i.e. marriage, birth/death, re-location, etc…) that result in beneficiary, address and/or phone changes, the PRA is provided the updated information. Updated information can be provided on a beneficiary form that can be found on the PRA website:  http://www.pra-milwaukee.com/

and/or the member can contact us at (414) 649-8373 to request a form be emailed and/or mailed.     

To claim a death benefit for a PRA member, the designee at death (i.e. spouse, surviving children) must contact the PRA at phone number (414)649-8373 to verify the member was active and in good standing and must provide a death certificate for the decedent.  Members should be aware that the PRA Board members time is voluntary, thus, we do not have a full-time staffed office and will make a good faith effort to respond as soon as possible.

Currently, the PRA Fund is at 8.5 million dollars and it is the PRA Board’s fiduciary responsibility to ensure money collected from members and through donations (i.e. Combined Giving and/or private donors) is invested for fund growth and we all thank you for allowing us to serve the membership as your PRA Board.

                                                        Branko, Shannon, Dena, Pat, David, and Eric

From Greg Thiele

As many of you know, I have had hearing aids for about 15 years. I had to pay out of pocket each time I needed new ones. Today I was at the Avada office in Wisconsin Rapids for my annual test, which is always free. While talking to my audiologist was I was informed that United Health Insurance is now covering portions of hearing aids. He thought that Humana also might be covering some of the cost. While at the office his receptionist contacted United Health and Avada’s corporate offices. I need new hearing aids. The cost is around $5000. United Health informed the receptionist that my out of pocket cost is around $800. They pay the rest. The portion they cover also has to do with how much is left on your deductible. I  for one never knew that United Health was covering any of this. From what they told me, United Health will cover up to around $5000. I was also informed that Avada was bought out by a large company that now owns almost 95% of all hearing aid companies in the world. This company put pressure on many of the insurance companies to start to cover the cost. This company also lowered the cost of hearing aids to make them more affordable. The hearing aids that I am getting for $5000 were almost $9000 last year.   I hope this information helps some of you in the future.   Greg