Audit of the Massachusetts Teachers’ Retirement System (MTRS)

This is a state performance audit of the Massachusetts Teachers’ Retirement System, the agency that pays retirement, disability, and survivor benefits for many Massachusetts public educators and their families.

“I am pleased to provide this performance audit of the Massachusetts Teachers’ Retirement System.”

The auditor checked whether MTRS paid first pension checks on time, calculated later payment adjustments correctly, and stopped or changed payments properly after retirees or beneficiaries died.

“The purpose of our audit was to determine whether (1) MTRS ensured that members received their first pension payments within the timeframe established by Section 13(1)(b) of Chapter 32 of the General Laws, (2) MTRS ensured that adjustments made to monthly benefit payments after the issuance of the first payments were completed accurately in accordance with Section 5(2) of Chapter 32 of the General Laws, and (3) MTRS promptly identified deceased retirees and beneficiaries and subsequently adjusted or terminated benefit payments accurately in accordance with Section 12(2) of Chapter 32 of the General Laws.”

This matters because MTRS handles billions of dollars in pension payments for tens of thousands of retired educators and survivors, so delays or errors can affect people’s income and tax records.

“In fiscal year 2019, MTRS issued more than $3 billion in benefit payments to more than 67,000 retirees and survivors.”

If you are a Massachusetts teacher, administrator, retiree, survivor, or family member, this audit is about whether pension payments are timely, accurate, and properly reported.

“According to its website, MTRS provides “retirement, disability, and survivor benefits to Massachusetts teachers, administrators and their families.””

MTRS was found to be accurate in some areas, but it missed the deadline for a significant share of first pension payments and had one Social Security number reporting problem.

“Our analysis of the 4,907 retirees whose effective dates of retirement were during our audit period showed that 24.8% (1,218) did not receive their first monthly benefit payments within the required timeframe.”

The auditor recommended that MTRS look at shifting resources to process late-filed retirement applications faster and make sure benefits are paid and reported under correct Social Security numbers. MTRS said it had corrected the SSN issue and added a check for future reporting.

“Based on its response, MTRS is taking measures to address our concerns on this matter.”

MTRS is not a small program; it is the largest public contributory retirement system in Massachusetts, so its payment process affects a large number of educators and retirees.

“The MTRS, which is the largest of the Commonwealth’s 104 contributory retirement systems, provides retirement, disability and survivor benefits to Massachusetts teachers, administrators and their families.”

An annuity is the part of a retirement benefit based on the worker’s own contributions. The pension is the rest of the legally required retirement allowance, funded beyond those contributions and investment earnings.

“Retirement benefits that members will eventually receive have two parts: an annuity and a pension.”