Brief Legislative Update

June 2009

The legislature has recessed until next year. An omnibus pension bill (200+ pages) was passed by the legislature in the closing days of the session and signed by the Governor. There were not any provisions of general applicability that were of concern to us.

    General Info bits and pieces:

  • MSRS Pension – Based on the legislation passed last year, the cost of living increase in January 2010 will be 2½%.
  • Social Security – no cost of living increases (COLA) in 2010. The good news is that there accordingly will not be any increase in Medicare Part B premiums in 2010.
  • Federal Health Care Reform – The major players are actively pursuing effective reform so far and appear to be working for solutions. The health industry trade group has made a commitment to help pass health care reform this year. A major stumbling block is expected to be the amount of taxpayer cost of a new program and how to pay for it (expand and subsidize coverage for the 47 million Americans who can’t afford decent health insurance now). Got a view on health care reform? To get involved, go to the AARP website:
    www.healthactionnow.org

 

Legislative Update

Feb 12, 2009

The Minnesota Legislature has been in session since January faced with major funding issues and the U.S. Congress has continued to struggle with our faltering economy. The following legislation is carefully being followed on behalf of MRSEA members:

  • Pension Commission activities: The Legislative Commission on Pensions and Retirement (LCPR) met throughout last summer and fall with a major focus on reviewing their existing principles of pension policy and adopted minor changes at its last meeting in February (this document is available on the LCPR web site). The Senate has appointed some new members to the commission and the commission elected new officers at the February meeting; Sen. Don Betzold, Chair; Rep. Mary Murphy, Vice Chair; and Rep. Steve Smith, Secretary. Also at the February meeting, the Commissioner of the Department of Corrections (DOC) and the Assistant Commissioner of the Department of Management and Budget gave a presentation on proposed 2010-2011 budget reductions in the DOC. The Governor’s recommendation is to shift a significant number of employees from the MSRS Correctional plan to the MSRS General plan which will reduce employer retirement contributions by $5.231 for the biennium and will result in the potential for loss of paid insurance upon retirement for those employees who are shifted to the MSRS General plan saving a projected $404,000 for the biennium. It must be noted that this proposal will not affect any present retiree. It is anticipated that this proposal will be strongly opposed by the various bargaining units.

  • IRA Required Minimum Distribution: The U.S. Congress has passed and the President has signed into law, the “Worker, Retiree, and Employer Recovery Act of 2008” (HR7327) which waives the requirements of minimum distribution of funds in an IRA for calendar year 2009. This means that persons over age 70 ½ with funds in an IRA will not have to make the usual required minimum distribution (and accordingly will not have to declare that as income and pay taxes on that distribution) during calendar year 2009.

  • Health Insurance: “The Minnesota Health Act” has been introduced in the Minnesota Senate (SF118) by Sen. John Marty and the companion bill was introduced in the Minnesota House (HF135) by Rep. David Bly. It should be noted that the House bill was co-signed by 34 other House members. The Senate bill has been recommended for passage by 2 committees to date but the House bill has yet to receive a hearing. The purpose of this bill is to establish a state health care system to provide health care services to all Minnesota residents. Given the current budget crunch in the state, it is not anticipated that this bill will pass this session but hopefully it will generate some discussion on the importance of health care and its costs.

In addition to the above activities, the MRSEA Legislative Committee is keeping in close contact with the MSRS Board of Directors and other groups active in retiree issues.