Excerpt from First Annual Report of the Teachers' Retirement Board: For the Year Ending December 31, 1914
In June, 1913, the General Court, by the enactment of chapter 832 of the Acts of 1913, provided for the establishment, on the first day of July, 1914, of a retirement system for public school teachers employed in the cities and towns of Massa chuset'ts. The general principles upon which this retirement system was founded are the same as those of the retirement system for State employees established in 1912, but there are some changes in matters of detail. Members of the Teachers: Retirement Association by law contribute a certain per cent. Of their salaries to the retirement fund. The rate of assessment is to be fixed annually by the Teachers' Retirement Board, but cannot be less than 3 nor more than 7 per cent., subject to the provision that no annual assessment shall exceed $100 or be less than $35. For the' year beginning July 1, 1914, the Teachers' Retirement Board officially fixed the rate of assess ment at 5 per cent. Assessments are deducted by the school committees in monthly instalments, and forwarded by the town and city treasurers to the secretary of the Board. Ao cording to the provisions of the statute he transmits each month to the Treasurer of the Commonwealth the amounts received by him, and the latter invests the same in securities which are legal for sinking funds. The law provides that members of the association shall be credited on the last day of each year with interest at the rate of 3 per cent. Per annum on amounts contributed.
Membership in the Retirement Association is a condition of employment font teachers who enter the service for the first time on or after the first day of July, 1914. Teachers in the public schools Whose service commenced before that date are eligible to membership by making voluntary application. Boston teachers (except those in State - aided industrial schools) are not eligible to membership in this State system, as the city of Boston has had a local teachers' pension system for a number of years.
Members of the association may retire at the age of sixty years and must retire at the age of seventy years. At the time of retirement a member's own contributions with interest are used to purchase him an annuity, according to life insurance tables adopted by the Retirement Board. The Commonwealth by law grants a pension equal to the annuity; thus in the cases of new teachers one - half of the retiring allowance is derived from the teacher's own contributions and one-half from: the State treasury. Realizing that many teachers who were in service prior to July, 1914, would not be able to make very many contributions before reaching the retirement age, the Legislature provided that in the case of teachers in service at the time of the establishment of the system, who before retire ment shall have served fifteen years or more in this State, at least five of which must immediately precede retirement, an additional pension will be granted from the State treasury, the amount of the same to depend upon the number of years of service in Massachusetts. For these members, also, the law provides that the minimum ret1r1ng allowance shall be $300 per annum.
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