Town Meeting Members approved a slight increase to the cost-of-living adjustment (COLA) payments for retirees.
On Monday, the Town Meeting approved Article No. 8 to raise the base amount used to calculate COLA benefits for retirees from $14,000 to $16,000 starting July 1. The approved amount is half of the original increase proposal.
“It’s important,” said Tom Driscoll Jr., the chair of the Swampscott Contributory Retirement Board. “I think it’s a good statement from our town to support retirees.”
Eric Hartmann, the chair of the Finance Committee, said he is also happy with the increase.
“We were pleased with the town’s vote to increase the COLA base for our retirees to a level matching the statewide average,” Hartmann said.
COLAs help protect fixed incomes from inflation. They ensure that essential items are still affordable to individuals. They’re typically based on inflation measures like the consumer price index (CPI).
The CPI indicates that the US inflation rate was 2.4% for the past year, as of March 2025, according to the US Bureau of Labor Statistics.
COLAs are most often associated with Social Security benefits but they can also be applied to union contracts, pensions and other fixed streams of income.
For a town like Swampscott, COLAs help residents maintain purchasing power in the face of rising costs. The COLA helps retirees offset the effects of inflation.
Finance Committee Member Naoimi Dreeben announced the article at the Town Meeting Monday and acknowledged the “very lively, significant debate” her committee and the Retirement Board had. The latter group was pushing for a base increase to $18,000.
“What we ended up finding in terms of our consensus is that $16,000 is the state average,” Dreeben siad. “That’s what the Finance Committee really felt was appropriate.”
Now with the article approval, the 3% COLA will be applied only to the first $16,000 of the retirees’ pension income each year.
This does not impact the operating budget to the fiscal years 2026 or 2027, according to Amy Sarro, the director of finance and administration.
“You actually won’t see an impact on the operating budget until 2031,” Sarro said, adding that once the town is fully funded the newly approved COLA increase would have “only a $20,000 impact on normal costs.”
Prior to Monday night’s vote, Swampscott last approved a COLA increase in May 2021, when the base was raised from $13,000 to $14,000.
“We’re trying to keep pace,” Driscoll said.
Dreeben said during the Town Meeting that the $2,000 increase was an “appropriate level of change” to stay in line with other Massachusetts towns.
Hartmann previously told the Swampscott Tides the $16,000 figure was chosen with the tight fiscal year budget in mind. While a COLA increase would not hit residents’ pockets for a few years to come, Hartmann expects there to be strict budgeting for the foreseeable future.
The Swampscott Contributory Retirement Board had suggested an increase to $18,000, though, and Driscoll believed his group will have to return to Town Meeting in a few years for an additional funding request.
“But going to $16,000 is better than getting nothing,” Driscoll said.
