Not a ‘break’
I have to question the inclusion, as a “tax break,” the exemption of certain retirement income to state employees who were vested in the State of North Carolina Retirement System as of Aug. 12, 1989 (“Where did the $1 billion go?” April 28 article).
Back in the day, state employees were getting much less in salary than what was being paid in the private sector for the same work. As one of the inducements for employees to stay at lower wages, the North Carolina told employees that their retirement pay would be state-income-tax free when they retired. Later the state tried to renege on that and told the employees that they would have to pay state income taxes on their retirement after all. The N.C. Supreme Court, in the Bailey settlement, rightfully ruled in the employees’ favor.
Hardly the same thing as laws passed to favor a company or other groups. By the way, that cost will continue to decline as retired state employees age out.
Mark Hatcher, Raleigh