By Matt Murphy
05/14/2010

BOSTON — The Senate came through yesterday with a package of reforms to the state pension system that builds off previous attempts to rein in abuses of the system.

The reforms were part of piece of legislation aimed at giving municipalities relief from their budget woes by providing options to save money.

The bill, which included more than 40 new laws, passed unanimously, 37-0.

Among the reforms included in the bill was a cap on public employee pensions of $125,000.

The bill included eight changes to the pension law, highlighted by the cap and the elimination of the Section 10 early-retirement provision for new state employees that previously allowed state workers who lost their jobs to claim early benefits as a safeguard against politically motivated firings.

“This is going to make a difference in making government more efficient,” said Sen. Jamie Eldridge, D-Acton, chairman of the committee handling the bill.

Other pension reforms included:

* A ban on salary spiking limiting the annual increase in pensionable earnings to 7 percent

* Pro-rated retirements for employees who have served in different employment groups, preventing members from taking a high-paying, high-risk job for a few years to boost their retirement.

* A requirement for Supreme Judicial Court justices to pay into the state pension system. Justices currently do not contribute to their retirement.

The Municipal Relief Act also included new laws that will allow cities and towns to join statewide mutual-aid agreements for public safety, makes regionalization of services easier and offers some early retirements packages to municipal employees.

The bill now heads to a conference committee where House and Senate leaders will negotiate the differences to their respective bills. The House did not tackle pension in a version of the bill passed earlier this year.