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Nixon plans cut in Missouri pensions for the blind
• BY VIRGINIA YOUNG VYOUNG@POST-DISPATCH.COM > 573-556-6181
JEFFERSON CITY • Marie Thompson, 81, lost her vision as a toddler, when complications from encephalitis destroyed the optic nerves in her eyes.
Under a special program for the blind, she has received a “pension” from the state of Missouri for about 60 years. Thompson said the money helped her afford the public transportation, readers and other services she needs. Initially $51 a month, Thompson’s pension now totals $718 a month.
But in an unusual move, Gov. Jay Nixon’s administration is cutting back on the $32 million-a-year program. The Department of Social Services has told all 3,847 people receiving the pension checks to expect a $33-a-month cut in January. The cut will save the state an estimated $730,000.
The administration’s rationale — that the fund is suddenly going broke — is puzzling to some advocates for the blind, given that the pensions are funded from a small statewide property tax. Statewide assessed property values are projected to grow this year, according to preliminary data from the State Tax Commission.
“I don’t see how, when the assessment goes up, the money coming in is going down,” said Sen. Paul LeVota, D-Independence. “I don’t quite understand the math there. There should be a clear, transparent reason for why we’re cutting services for people who need them.”
Social services officials say that for the last several years, the pensions have been costing more than the blind pension fund collects from the property tax. State law calls for benefits to be reduced when that happens, the department said.
“In the history of the blind pension program, the department has never experienced this particular scenario,” Alyson Campbell, director of the Family Support Division, wrote last summer to John Ammann, a lawyer who represents the blind.
Missouri has provided monthly cash benefits to the blind since the 1920s. State voters set up the pension fund through a constitutional amendment.
To qualify for pensions, people must be totally blind, not just legally blind. They can have no more than 5/200 vision or a visual field of less than 5 degrees. Legal blindness is 20/200.
Pension recipients must be at least 18 years old. The blind pensioner and spouse can accumulate no more than $20,000 in savings or property, not counting their home.
Separately, the blind receive state-paid health care, a program that Nixon fought to preserve several years ago when Republicans tried to cut it. That health coverage is not affected by the upcoming pension cut.
The pensions are financed by an annual tax of three cents on each $100 assessed valuation of property in the state. Last year, the tax raised $29.82 million, down from $29.98 million the previous year.
Chris Gray, executive director of the Missouri Council of the Blind, said state officials told him that “property tax values are not increasing; they are decreasing because of foreclosures, because of the soft property market, because property is falling in price, and that there truly isn’t enough money in the fund to pay each pension recipient their share for the whole year.”
Gray said “the peculiar thing” about the pensions is that they are calculated based on property tax collections two years earlier. Indeed, in a seeming contradiction, the blind got a $7-a-month increase in their pensions in July, based on growth in property tax collections in the 2013 budget year.
Such annual increases have been the norm over the years since the state’s assessed valuation usually rises because of construction and higher property values. That has boosted the blind pension from a maximum of $489 a month in 2005 to the top benefit of $718 today.
But since 2008, the statewide assessed valuation of property has teetered up and down. Thus, collections for the pension fund have dipped or generally remained flat. That has required the fund to rely on its fund balance.
The state says the fund will run dry before July 1 if pensions aren’t cut. Officials say a $33-a-month cut in January will spread out the pain over the last six months of the state’s fiscal year, rather than forcing a bigger cut in the spring.
Ammann, an attorney at the St. Louis University Law Clinic, questions the timing. Property tax receipts will flow to government coffers during December and January. In other words, money to fund the program hasn’t come in yet this fiscal year. “If property tax revenue goes up, they may not need to do this,” he said.
Ammann said the Nixon administration’s planned cut is unrelated to a recent court decision that found the state had been shortchanging blind pensioners since 1992. The amount of that underpayment is on appeal.
Nixon could ask legislators to supplement the blind pensions with state general revenue. But advocates say that’s unlikely, given that Nixon has frozen funding for scores of programs.
Gray said the pension cut will be hardest on people who don’t receive the maximum amount now. He said he was contacted by one elderly person who receives $53 a month under a small subset of the pension program called Aid to the Blind.
“It’s going to be a tough cut for a lot of people, but I think the people getting $718 a month, they’ll find a way to accommodate a $33 decrease. But to have a cut from $53 to $20, that seems pretty draconian,” Gray said.
Thompson, for one, isn’t complaining about her share of the cut. She said her pension, combined with Social Security, covers her apartment bills in St. Louis, with enough left over to eat out occasionally with friends at Steak and Shake. She figures she’ll eat out less now.
“As I told some of my friends — they were kinda upset — I said, ‘We’ll just have to all make do with what we’re allowed to keep.’ We’re very lucky to receive this blind pension.”