Schumer: With No Social Security "Cost-Of-Living Adjustment," More Than 1.7 Million Upstate New Yorkers Did Not Receive A Social Security Benefit Increase This Year

Press Release

On a conference call with reporters, U.S. Senator Charles E. Schumer today urged his colleagues to pass the Seniors and Veteran Emergency (SAVE) Benefits Act, which would provide a one-time payment for Social Security recipients who did not receive any increase in Social Security this year. The Schumer-backed bill would provide a one-time payment of $580 to Upstate New York seniors and individuals with disabilities who were denied a cost-of-living adjustment (COLA) in 2016. Schumer said Upstate New Yorkers were shocked to learn that they would not see a typical benefit increase this year, even though many of their living expenses have increased.

"Millions of seniors, veterans, and individuals who are disabled deserve and need a little more money in their Social Security checks to help pay for the ever-increasing cost of rent, medicine and groceries. But unless Congress acts, and acts fast, Upstate New Yorkers will not see any increase in their earned benefits this year -- meaning it will be harder for some of our most vulnerable to pay for their living expenses. I am proud to support the SAVE Benefits Act, which closes a corporate tax loophole to give seniors a little more money to make life a little easier," said Schumer.

Schumer explained that next year, for only the third time since 1975, those who rely on Social Security will not see a cost-of-living adjustment (COLA) to increase their benefits. According to the federal Social Security Administration (SSA), the purpose of the COLA is to ensure that the purchasing power of Social Security benefits is not eroded by inflation. COLAs are based on increases in the Consumer Price Index for Urban Wage Earners (CPI-E) and Clerical Workers (CPI-W). The annual change in the CPI is used as a measure of inflation. Both CPI formulas tracks the price of the "typical basket" of consumer goods. However, Schumer explained that the federal government's CPI formula heavily weights the price of gas and energy.

Schumer blamed a flawed funding formula used by the federal government to determine COLA increases. While the cost of rent and other expenses have increased, Schumer explained that recently falling gas and energy prices, which do relatively little to help the disabled and elderly, are largely to blame for zero increases in Social Security benefits. Schumer said this is unfair, because several other cost of living indicators, like groceries, medicine and rent, are increasing, and these items impact seniors on fixed incomes in particular. Schumer said this lack of a COLA is historically very rare and means the seniors who usually get an appropriate increase in their benefits on January, 1 will not see an extra dime this year unless Congress acts. This is also the case for millions of other Americans whose veterans' benefits, disability benefits, and other monthly payments are pegged to Social Security. In the past two decades, Social Security recipients typically have seen an average yearly benefit increase of 2.4 percent to keep up with prices. Schumer said that, if one were to take energy out of the mix, this formula would show a rise in prices by over 2 percent last year.

Schumer cited the fact that the last time there was no COLA was in 2010, and also the year before in 2009. However, in 2009, in the midst of the recession, Congress provided a one-time $250 payment to Social Security recipients to help them get through those tough times. Schumer said Congress should do the same thing this year, highlighting the fact that the cost of goods and services are still on the rise even though gas prices are low. Schumer added that many veterans and persons with disabilities are less likely to drive and are therefore saving less than your average consumer from low gas prices. They are, however, impacted by the prices of medicine, grocery and rent which are steadily rising.

Schumer is therefore urging this colleagues in the Senate to pass theSAVE Benefits Act, which would do three things. First, it would provide a one-time check of approximately $580 for seniors and other Social Security recipients, like individuals with disabilities and veterans, to help them make ends meet. Second, it would fully pay for this one-time check by closing a loophole that benefits corporate compensation packages of over $1 million. Specifically, this bill would give about 70 million seniors, veterans, persons with disabilities and others nationwide a supplementary payment equal to 3.9 percent of the average annual Social Security benefit, about $581 -- the same percentage increase as the performance-based compensation rate of top CEOs. Finally, this legislation would provide this benefit while also using some of the revenue to extend the life of Social Security.

Schumer said this $580 is equal to roughly three months of groceries for seniors, or the average annual out-of-pocket expenses for prescription drugs from Medicare. Schumer said providing this one-time check to Social Security recipients in Upstate, NY and across the country is the right thing to do, as it would help keep benefits on pace with prices. Schumer explained that nearly two-thirds of seniors rely on Social Security for the majority of their income; and it is the only thing keeping about fifteen million Americans out of poverty. For these individuals, an increase in their Social Security benefits to keep pace with the rise in essential goods is especially important.

According to the Social Security Administration's Master Beneficiary Record, there were a total of 1,763,680 Social Security beneficiaries in Upstate NY in 2014. This also included a total of 1,251,270 Upstate NY seniors that received Social Security benefits. In addition, 275,440 persons with disabilities received Social Security benefits in Upstate NY in 2014. Schumer highlighted what that means for each region of Upstate NY:

· In the Capital Region, there were approximately 247,780 Social Security beneficiaries, including 174,925 senior citizens and 38,515 disabled workers.
· In Central New York, there were approximately 226,425 Social Security beneficiaries, including 175,995 senior citizens and 38,380 disabled workers.
· In Western New York, there were approximately 308,525 Social Security beneficiaries, including 214,555 senior citizens and 51,915 disabled workers.
· In the Rochester-Finger Lakes, there were approximately 264,015 Social Security beneficiaries, including 185,800 senior citizens and 42,215 disabled workers.
· In the Southern Tier, there were approximately 174,465 Social Security beneficiaries, including 121,760 senior citizens and 28,715 disabled workers.
· In the Hudson Valley, there were approximately 420,105 Social Security beneficiaries, including 315,965 senior citizens and 54,120 disabled workers.
· In the North Country, there were approximately 122,365 Social Security beneficiaries, including 82,270 senior citizens and 21,580 disabled workers.
The SAVE Benefits Act was introduced by Senator Elizabeth Warren, and is co-sponsored by Senators Ed Markey, Barbara Mikulski, Patty Murray, Charles Schumer, Bill Nelson, Debbie Stabenow, Bernie Sanders, Sherrod Brown, Bob Casey, Sheldon Whitehouse, Jeff Merkley, Kirsten Gillibrand, Al Franken, Dick Blumenthal, Chris Murphy, Mazie Hirono and Tammy Baldwin.

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