Retirement insights from a Colorado PERA perspective

Legislation & Governance

WEP/GPO Bill Introduced in D.C.

photo credit: KenTannenbaum – 495600910 – GettyImages

A bill introduced in the U.S. House of Representatives on January 4 would repeal the Windfall Elimination Provision (WEP) and Government Pension Offset (GPO) provisions.

Since these became law more than three decades ago, there have been numerous bills introduced to repeal them. None have passed.

This is a topic of concern for many PERA members. Why? The WEP and GPO can affect retirement planning in a serious way. During their working years, a PERA member might receive a benefit estimate from Social Security with one number on it, but when they claim their benefit years later, the amount is often less. Sometimes a lot less.

“Why are PERA members penalized?” “Are folks in other states affected?” “Who has the power to change this?” “Will this this bill likely pass?” “What is PERA doing about it?” These are some examples of questions PERA often receives from its members.

In light of this new legislation, PERA On The Issues asked these questions to PERA’s legal and government affairs staff.

An Overview of the WEP/GPO

The internet is filled with articles about this topic, including on Social Security’s website. Through the years, PERA On The Issues has also covered this topic:

The articles above contain in-depth explanations. Here’s a high-level overview:

  • Most PERA employers do not participate in Social Security. This means employees do not pay the 6.2% Social Security tax. Instead, they contribute to PERA. This is why PERA is considered a Social Security replacement. It is important to point out that PERA benefits are never reduced by Social Security or any other retirement plan.
  • However, many people who participate in PERA pay Social Security taxes while at other jobs at other points in their career or are married to someone who qualifies for a Social Security benefit. That’s where the WEP/GPO come in. While a person can earn both benefits, Social Security can reduce the Social Security benefit people receive on account of the years they did not pay Social Security taxes. These reductions apply if a person has less than 30 years of substantial earnings while paying Social Security taxes.
  • There are other details covered in the articles above, including how the WEP differs from the GPO, how these benefits are calculated, how paying Social Security taxes for at least 20 years can lower the reduction, and more.

PERA Staff Answer Questions about Legislation

Michael Steppat, PERA’s Public and Government Affairs Manager and Jennifer Schreck, PERA Senior Staff Attorney and Manager of Legal Services, answered questions about WEP/GPO legislation.

Can the Colorado legislature or PERA change anything to get around the WEP/GPO?

Jennifer Schreck: No. While PERA members are affected by these laws, they are affected because of the years they don’t participate in Social Security—not because they are PERA members. Social Security is administered at the federal level. These laws exists at the federal level, so any changes to how Social Security works would need to take place at the federal level.

Who is affected by the WEP/GPO? Would this bill change it for everyone?

Jennifer Schreck: Anyone who works for an employer that doesn’t participate in Social Security is currently affected by WEP/GPO laws. This includes approximately a quarter of state and local government employees across the country. If this bill passed as currently written, it would eliminate the WEP/GPO for everyone.

If this legislation passes, would my PERA benefit be affected?

Jennifer Schreck: No. Your PERA benefit is determined by state law—not federal law. The WEP/GPO do not affect your PERA benefit now, and if the WEP/GPO were repealed your PERA benefit would remain unaffected.

Does this bill have political support?

Michael Steppat: The introduced bill does have bipartisan support—members from both parties have signed on as sponsors of the bill. President Biden has stated his support for eliminating the WEP/GPO. However, previous attempts to repeal the WEP/GPO have had bipartisan support as well.

Who would be against eliminating the WEP/GPO and why?

Michael Steppat: Opponents of past WEP/GPO legislation often cite fiscal constraints. Paying higher benefits to the people affected by the WEP/GPO would cost money. Opponents of the bill say it’s not fair to those who paid Social Security taxes for their entire career. There are plenty of lawmakers with this opinion, especially considering the majority of public employees, not to mention those in the private sector, do pay Social Security taxes.

What is the likelihood that this bill passes?

Michael Steppat: It’s hard to see what has changed since prior bills have been introduced and failed.

Where do Colorado’s lawmakers stand, and what is PERA doing about this issue?

Michael Steppat: Of the current 52 co-sponsors of the bill, none is from Colorado. However Colorado Senator Bennett and Representatives Crow, Neguse, Perlmutter, and Tipton did sign on to the last iteration of legislation repealing WEP/GPO and may do so again with this new bill if they choose.

While PERA continues to educate our Congressional delegation on this issue of great importance to members, the most effective advocacy is for constituents to contact their member of Congress and share what impact these laws have on them.

Comments

  1. John G. Paton says:

    Well since the “higher cost” of elimination of the WEP/GPO one has to take into consideration that the cost would be paid for with “our monies” and surely the Gov would reduce the amounts that we would receive just not as much as is taken away now. As for the other aspect I don’t understand with Gov intervention and the “bucks” involved where “fairness” even comes into play? All is fair in love and war; but not politics!

    • PERA On The Issues says:

      Hi John,

      One key difference between PERA and Social Security is that with PERA, your benefit is directly related to what you put in. In other words, you will always get back what you put in, and the longer you work and the higher your HAS is, the bigger your benefit becomes. Social Security on the other hand, was designed to be a safety net program: people with lower career earnings get a higher percentage of their average income while higher earnings get a lower percentage. As a result, some people (even those who aren’t affected by the WEP/GPO) won’t get back what they put into Social Security.

    • Valerie Hunt says:

      I was able to “buy” retirement years after the national disaster of 09/01/01 and I bought 17 years for almost $100K from rolling over the balance of my mutual funds. Then I cannot receive the social security I did pay into for 22 years without being penalized 45% on my earnings in social security. Completely unfair!

    • Michael Byerly says:

      I have been Engineering tech for the Federal government for 14 years at the Dallas VA. After paying full social security payments throughout those 14 years, I am being penalized over $400.00 per month from Social Security because I had retired from the City of Dallas that isn’t a member of the SS Program. My social security payment is adjusted with the 35 year SS fracture. That is fair. However, the further 40% reduction due to WEP is not fair. It doesn’t seem fair to take 100% social security payments and then upon retirement, take out an additional 40%.

  2. Karen E Gavin says:

    I think WEP/GPO should be repealed. No one has a choice as to how their payroll taxes are charged. I wanted to work for a university and help students be more successful. I didn’t ask what type of payroll taxes I would have when I applied for the job. Maybe if I realized the impact my job would have on my retirement I would have made a different choice. I have lost half of my Social Security for the rest of my life for a job that didn’t offer me a pension by the time I retired. Hopefully I won’t have to depend on other state social programs as I age because I don’t have enough money to live on.

  3. H R Kosley says:

    This whole thing is a mess & unfair. Illegals can get social security benefits but we can’t even after paying into it for years. This needs to be repealed.

    • KM Thorson says:

      I started paying into SSN when I was 16 years old. In 1997 my 2nd husband died; my first husband died when he was 34 years old. I began my career with the State in 1997.When I was eligible to draw on my deceased husbands SSN I was able to finally make a living wage while working for the State. I retired from the State with 17 years of service and my PERA benefits kicked in. The State of Colorado instantly cut my SSN benefits by 50%. They considered SSN as supplemental income now. Wrong!!

    • Vera Moreno-Hamm says:

      I´m wondering how an illegal immigrant can draw benefits without documentation? They work and get nothing!

    • Jan says:

      Absolutely.

  4. Carol Roehrs says:

    I paid Social Security taxes for one career and PERA for another with very little overlap. Why should the second career cancel out much of the retirement I earned in the first career? Not fair.

    • Christie Einspahr says:

      Very true, Carol!
      I worked 2-3 jobs as a single mom. I have my quarters in Social Security. Why shouldn’t I receive both PERA and Social Security (without reduction)

    • Nancy says:

      Exactly!! I totally agree! WEP cancels much of the SS benefit of non PERA years. Unfair!

  5. Lynn says:

    This is insanely unfair! It is NOT taking money that we did not pay into. If we worked part of our career life paying into Social security and part paying into PERA, WHY SHOULDN’T WE BE ABLE TO GET OUR FAIR SHARE OF SOCIAL SECURITY???

    REPEAL IT!!!!

  6. Lonnie says:

    This law is communistic! Yes I said the dirty word. but its true, and its time something was done about it. Why are we electing our law makers based on political affiliation? Its time to wake up people and vote for the law makers that support bills like this one and oust the rest. How they vote on bills is public!!!!

  7. Barry Northrop says:

    The perennial bill to repeal WEP/GPO is again on deck. I would love for it to pass but anticipate another strike out.

  8. Nancy Mohler says:

    It seems we are being penalized for a long working life; paying into social security and then having that reduced since we get Pera benefits. By the way, Pera benefits have been reduced significantly from what I was promised. Both systems have taken away from a lifetime of working.

  9. Ramona says:

    I don’t have a problem with SS not giving me a benefit because I never paid in to it. However, I have a problem with my husband’s SS spousal benefit to me (should he die first) being affected the way it is because I am a PERA member.

    • Christie Einspahr says:

      Yes! This isn’t fair. We aren’t asking for folks to receive Social Security if they haven’t paid in. We are asking for those who have or who have spouses who have, not have their benefits reduced when they draw their PERA benefits.

    • SHARON MAAG says:

      My husband passed away this past summer and had paid into SS for 44 years at the same job. I receive my PERA retirement but can only receive $200 per month of his earnings because I am on PERA. As a school bus driver my income is not very much due to the hours I worked, so I should be able to receive much more SS if this bill was passed and WEP done away with. I may eventually have to depend on social services but I do not want to!

    • jf says:

      Definitely my case as well. I had an entire career outside the PERA system prior to my government employment; however, my social security was reduced nearly two-thirds due to my PERA pension.
      I am also ineligible to receive my husband’s social security. Since he paid the highest tax into social security for his entire career, this is very frustrating and unfair on all fronts.

    • Sheryl Shipton says:

      I totally agree! I did not pay into SS most of my work life, but my husband did. As his widow of 14 years, the GPO wipes out any benefits I could be receiving. Those were benefits he earned and are now lost to his family because of where I worked. It unfairly caps retirement income for those working in the public sector.

  10. Ben Varner says:

    I taught for 47 years at an institution which pays only into PERA; however, I also ran a consulting business which paid quarterly taxes into FICA. When I retired, half of my Social Security pension was deducted because of my membership in PERA. That certainly is not fair.
    Moreover, now when any of my young friends ask me about a teaching career, I warn them that if they intend to draw a full Social Security pension, they must NOT accept a teaching position which requires payment into PERA. The federal government will unfairly penalize them.

    • Ramona says:

      I think they can actually work in PERA then take the payout option when they retire (don’t get a defined benefit) then claim SS.

  11. Rita M. Porter says:

    Repeal it!!! It affects spousal benefits. It should have nothing to do with spousal benefits after your spouse passes. Everyone else is entited to the benefits except me. He paid into it for all those years, I should have the same entitlement as others. Has nothing to do with my income.

    • Carol Going says:

      I agree. I had to sign a document indicating that I would get zero of my husband’s SS if he passes before I do. He paid it; I should get the portion of SS that other widows receive. I have a friend who married a German National and lives in Munich. He receives SS. How does that happen??

    • Jen Farley says:

      Definitely my case as well. I had an entire career outside the PERA system prior to my government employment; however, my social security was reduced nearly two-thirds due to my PERA pension.
      I am also ineligible to receive my husband’s social security. Since he paid the highest tax into social security for his entire career, this is very frustrating and unfair on all fronts.

    • Theresa Case says:

      I agree, my husband passed at 57 years old, and had paid into SS since he was 16. I am retired Pera, and I have had to pay health care, as he was providing that. I still have all the same monthly bills, just 1/2 the income. I’m not being charged half price for property taxes, health insurance, car insurance, utilities etc. Health insurance skyrockets, but no Pera increases. Oh , I won’t be 65 for 4 more years. Thank you for anything that would change. This is not fair. Struggling widow!

  12. Jennie Jones says:

    Totally unfair had to work two jobs to pay bills. Now they take 2/3 of my social security because I get pera. What a con job, congressman get their wage for life after serving.

    • Christie Einspahr says:

      Yes! Me too. Not fair.

    • Stan says:

      It is not true that congressmen get their wage for life after serving. The majority are in the FERS system of retirement (if they entered Congress after 1984, when this system was enacted). They must serve 5 years to be eligible for retirement, and cannot draw retirement until reaching age 62. They are also capped at 80% of their high three average, which they would be able to draw after 67 years in Congress. For more information do a search for Congressional Retirement.

  13. George Scott says:

    Email members of the U.S. House of Representatives and the U.S. Senate and urge their support of HR 82!

  14. Troy Phelps says:

    Thank you for the update, Pera. I will contact my representative right away.

  15. William Angermann says:

    The WEP (Windfall Elimination Provision) was enacted in the 1980s specifically to prevent government employees from getting a “windfall” when they retire by collecting both a pension, and social security. I do not know of any public employee who is or has gotten rich by collecting their pension, and the reduced amount SSA offers them in retirement. In fact, most government employee retirees are in desperate need of whatever additional funds they could get with the WEP/GPO elimination. The amount will always be lower based on the reduced amount government employees paid into SSA during their working years. At least let us retire in dignity, and allow us to not constantly worry if our retirement allotments will be enough to keep us fed, housed, and clothed in retirement.

  16. Robin says:

    I sincerely hope the legislators will do the right thing. Repeal the WEP.
    Many PERA retirees have voiced in writing sound and fact based reasoning for this repeal.
    Congretional Reps: “Please listen, do the right thing.”

  17. Beverly says:

    Read the Congressional Research Report referenced in a prior PERA article. The arguments for and against the WEP are not balanced nor nearly as descriptive as the comments of our PERA members here. Perhaps we should be reaching out to our Congressional Delegation requesting a true representation of the lifetime contributions that those of us that have worked in both systems have made. I would not vote to change the WEP either if all I had to inform me was the outdated and poorly written Congressional Research Document on WEP, supposedly updated 2/4/21.

  18. Jeanne says:

    It should definitely be repealed. I worked for 17 years in the private sector. Why should I be penalized for getting PERA? I worked hard for everything I earned under social security. I’m not asking for a hand out. I’m asking for what I earned.

    • William Pittman says:

      I have always likened it to working for Ford Motor Corp. and then working for General Motors! Why should I be penalized later in life when I had no choice as to which retirement plan I was signing on to? Had I had the choice, I would definitely have chosen PERA! Private industry and retired Military are not oppressed like this! Please repeal!

  19. Jeffrey Esbenshade says:

    Retired military get both SS and military pension

  20. Gregg Garvin says:

    Political Extortion! I’m being robbed!

  21. Michael Stoffler says:

    Would the passing of this bill, restore full SocSec benefits to those who have been retired already . . . 2010?

  22. Joe Laterra says:

    First, thanks to those elected officials that are supporting The bill, Senator Bennett, Representatives Crow, Negose, Tipton and Perlmutter as Pera benefit recipients let’s be certain to vote for them for reelection. Secondly, keep reminding those in charge that because we earned the benefit while working, reducing the amount is discrimination. Perhaps an anti-discriminaation law suit would provide a fresh approach. Finally, any amount the Fed would start returning would be subject to Income tax just like our Social Security benefits are now.

  23. Linda White says:

    So where is the social security money going to? I worked 27 years under SS, then 17 under PERA. and get about half ss in retirement. Discrimination. Period. I used my skills and paid into both. I should have my full benefit. I am disappointed in Colorado. Now is when as a retiree I need MY money.

  24. Laura Page says:

    While the reason for the WEP has some validity, the formula for benefit adjustment is arbitrary and disproportionately penalizes lower-wage workers.

  25. Lawrence says:

    The important takeaway from this article is the last paragraph. If you want something done, YOU need to advocate for yourself and contact your elected officials. Here’s what I wrote to my representatives. Feel free to use it as a template or tell them how you are personally affected.
    I am asking for your support in the repeal of WEP. Having worked in both the private sector and Colorado State government, I am directly impacted by not receiving my full Social Security benefit. This legislation needs to be given more than lip service and repealed for those of us losing the full benefit we paid for and rightfully deserve. I realize this is an uphill battle but trust you will work hard on our behalf to see this through. Thank you for your continued efforts. Here is a brief summary; U.S. Rep. Rodney Davis (R-Ill.) re-introduced H.R. 82, the bipartisan Social Security Fairness Act (SSFA), which eliminates the Windfall Elimination Provision (WEP) and the Government Pension Offset (GPO), two titles of the Social Security Act that unfairly reduce or eliminate Social Security benefits for millions of Americans who have devoted much of their careers to public service.

  26. Patti says:

    I thought I understood and planned for my retirement, including WEP. Since I had 30 years in Social Security, WEP did not affect my SSA payments. However, I did not know that GPO would apply to spousal SSA benefits. My husband had a much higher SSA benefit than I and we understood that I would receive his higher SSA spousal benefit in case he predeceased me. When he died and I went to the SSA office to apply for benefits, I was shocked to find that my PERA benefit would reduce the SSA spousal benefit to almost nothing. Without his higher SSA benefit I was forced to sell my home and most of my belongings and leave Colorado. Those of us who had careers with benefits from both PERA and SSA feel deceived and cheated by our own government by WEP and GPO reducing or eliminating benefits we worked for.

  27. Joseph Barnes says:

    Terrible law lost my job in 1997 due to NAFTA,employed by gm. Went into government service 23 years later I have to retire 26 years of private service being penalized by half terrible.

  28. Michael Merrill says:

    As a significant potential impact from the thousands of PERA Retirees, current & future State of Coloradans why Doesn’t PERA Provide a white paper or at least a Policy Statement of Support to eliminate WEP! This not the first attempt to correct a political injustice from not only Colorado, but, the other 49 states & Territories. To some degree it’s not the amount of money we stripped of, but, the principle. We definitely aren’t in the top 1% and this will not be a trickle down effect. Please respond in a timely fashion.

  29. Pat salas says:

    Be aware that teachers (whose summer and holiday Second jobs often pay for classroom supplies) have social security benefits reduced because they are Windfalling. But federal reps and senators get to keep 100 percent of their government pension AND social security AAND 401k or other retirement investments. Fair, right? I think NOT

    • FAITH L WILLIAMS says:

      I think the most unfair part of this is that it doesn’t only affect the government worker,but their spouse. My husband never worked for any government entity, yet because I did, I receive 0.00 widow or spousal benefit from him working and paying in for 45 years. I suppose his earnings are supporting some illegal ailiens, who have already been provided a LEGAL way to come into our country…..VERY UNFAIR PLEASE REPEAL !!!!!!

  30. Donna Theimer says:

    The way I see it is for 20 years I worked in jobs that paid into Social Security. The government sends me statements that say I have earned a certain amount of money because of that – but, because the second half of my working life I worked for a PERA organization and did not pay into SS I have to take a deduction from SS. I’m not asking for more than what I would have earned had I not gone to work for the state. I would love to see WEP eliminated! It’s unfair to watch my relatives retire with pensions from their companies and collect their full SS benefits. It’s also unfair to watch government officials collect SS and their pensions.

  31. Paul Sullivan says:

    This bill needs to be repealed. It simply is not fair to teachers that have worked and now widowed cannot get their spouses benefit.

  32. Bruce Donaghey says:

    I am a retired Police Officer affected by the WEP. It certainly is a hardship not to be able to collect my full social security benefits.

  33. Jean Sullivan says:

    Congress needs more input from all of us on H.R. 82. Ask your friends and relatives, even your children, in all states to contact their congressional representative— whether or not they like that representative.
    Open with this request. Make it easy for them to figure out what you want. It can be this simple:

    “Honorable Congressional Representative,
    Please vote YES on H.R. 82. “

    DO Include your contact information:
    Name
    Address
    And Phone and/or email address

    If you want to share your story, start a new paragraph after the top line request. Do not bury the request in your story. You may, of course, repeat the request within or again after your story.

    They are not necessarily interested in anonymous, as they want to please voters, not anonymous bots.

    Sometimes it’s only one contact that makes a difference. Also realize that very few people actually contact their representatives, so please ACTUALLY do it. Wishing certainly won’t make it happen. Call, write, email or all and make your opinion be known.

  34. Herb nelson says:

    Most unfair law I have ever heard of singal out a select group of people and penalize them are the politicians penalized on there social security because they get a retirement paid by us plus there social security plus annuities paid by us but we can’t have what we paid for and there retirements are way bigger then ares

  35. Janet Arrington says:

    When will know if these issues are repealed. Just because I worked under CSRS should not prevent my getting my husband’s SS spousal benefit. It’s no different than if I had been a private sector individual who didn’t pay SS. I was blessed with a higher salary than some jut that shouldn’t be relevant.

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