House Committee Approves Pension Bill

Della Hulter and Delphine Steiner join AFSCME members supporting the omnibus pension bill Monday.
Della Hulter and Delphine Steiner join AFSCME members supporting the omnibus pension bill Monday.

The state Legislature is one step closer to passing an Omnibus Pension Bill that would help stabilize public retirements for decades to come.

With AFSCME Council 5 members there in support, the House Government Operations and Elections Policy Committee unanimously passed HF 3053 and sent it along to the State Government Finance Committee Monday. The Senate already passed the bill 66-0 in late March.

The bill would immediately cut the state’s pension liabilities by $3.4 billion, and address challenges that face our pension plans like longer life expectancy. Unfunded pension liabilities can hurt bond ratings, which would cost the state, local governments and school districts more money

The bill requires shared responsibility and sacrifice from everyone, including the state, employer, employee and retiree, to make the pension system strong for current and future retirees.

The pension bill is the result of three years of hard work by lawmakers and stakeholders, including workers, retirees and unions including AFSCME Council 5.

Additional funding must be part of the reform. Our pension plans aren’t getting the full Actuarial Determined Contributions needed for 100 percent funding, the Public Employees Pension Coalition (PEPC) pointed out in a letter to lawmakers. PEPC represents nearly all of the 340,000 active public workers in Minnesota and most of the more than 175,000 retired public workers who get public pensions.

Minnesota public employers pay only half of what public employers do on average in other states.

“Our employees have done their part,” PEPC wrote to legislators. “It is imperative that public employers do so as well … This legislation will clearly demonstrate that the State will honor the pension promises that have been made to the teachers, police officers, correction officers, firefighters, professional, skilled workers and other employees who devote their lives to serving the public.”

In addition to keeping promises to active members and retirees, the bill continues workers’ defined-benefit plans.

PEPC is in full support of the bill, as are all the pension fund boards of directors; governmental units like the League of Cities; and various school districts.