Rep. Ed Neilson: Budget Delivers Long-Overdue Pension Relief for Retired Police Officers, Firefighters, Teachers, State Employees
Pennsylvania House Democratic Caucus July 12, 2026 | 4:37 PM
State Rep. Ed Neilson today announced that the 2026-27 Pennsylvania budget includes long-awaited pension increases for thousands of retired municipal police officers, firefighters, public school employees and state workers who dedicated their careers to serving the commonwealth.
Neilson said that this investment is more than just public policy – it’s deeply personal.
"I grew up in the home of a Philadelphia firefighter, and I married the daughter of a Philadelphia police officer,” the lawmaker said. "I've seen firsthand the sacrifices these men and women make throughout their careers. After retirement, they deserve to live with dignity and without potential financial burden.”
The budget provides special post-retirement pension adjustments for retired municipal police officers and firefighters with payments beginning after August 1, 2026.
The increases will vary based on years of retirement and funded through a dedicated account within the Municipal Pension Aid Fund, ensuring municipalities are reimbursed for the additional costs over a 10-year period.
The budget also delivers cost-of-living adjustments for eligible retirees in both the Public-School Employees' Retirement System and the State Employees' Retirement who retired before July 2, 2001.
Depending on their retirement date, eligible retirees will receive increases ranging from 15% to 24.5% beginning with payments issued after July 1, 2026.
"These retirees spent decades serving our communities, educating our children, protecting our neighborhoods, responding to emergencies, and keeping state government running," Neilson said. "Meanwhile, the cost of groceries, utilities, housing and prescription medications has continued to climb. This adjustment recognizes both their service and today's economic reality."
Neilson credited his Northeast Philadelphia Democratic colleagues, state Reps. Sean Dougherty and Pat Gallagher, for joining him in making pension relief a top priority during this year's budget negotiations.
"While you'll undoubtedly hear others trying to claim credit for these pension increases, the truth is that my Northeast Philadelphia Democratic colleagues, state Reps. Sean Dougherty and Pat Gallagher and I fought to make this a priority during budget negotiations," Neilson said. "We stayed united, worked together, and delivered for the retirees who earned these benefits through a lifetime of public service. This was a true team effort and I'm proud of what we accomplished together."
Neilson acknowledged the uncertainty many retirees feel as political gridlock in Washington continues to create anxiety about the future.
"At a time when Washington seems unable to come together on behalf of working families and retirees, Pennsylvania stepped up," Neilson said. "No pension increase can erase every financial concern, but this will provide meaningful relief to people who have waited far too long for recognition of their years of service."
Neilson added that the pension provisions are another example of how the state budget does more than fund government; it can improve people's lives.
"Budgets reflect our priorities," Neilson said. "This year, we made it clear that Pennsylvania values the people who answered the alarm, walked the beat, taught in our classrooms, and served our Commonwealth. They kept their promise to us throughout their careers, and I'm proud we kept our promise to them."