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Chair Frentz members of the Commission and Commission Staff. Thank you
for the opportunity to speak with you today. My name is Mike Landers. I served for 27 years as a finance specialist with the Minnesota Department of Education. I’m here today on behalf of The Minnesota Retired State Employee Association (MRSEA). MRSEA was established in the 1940’s initially as a social organization, however, we expanded our focus in the early 1970’s to include advocacy on behalf of our members, particularly in the areas of pensions and group insurance. We represent thousands of retired state employees from all levels of state government and from all across the State of Minnesota and beyond. MRSEA strongly supports the provisions of HF 2237. This legislation provides a fiscally responsible and balanced approach to begin to address the needs of both active employees and retirees. It is fiscally responsible because, as the MSRS General Plan returns to full funding, it offers modest benefit increases to begin addressing the sacrifices made by all parties in the 2018 pension bill in order to restore the plans to a sound fiscal foundation. And it does so without requiring outside funding. These changes can be completely funded by the plan itself and is therefore cost neutral to the state budget. It’s balanced in that it increases the annuity benefit multiplier from 1.7 to 1.9 percent and offers a one quarter of one percent increase in retiree COLA thereby addressing the needs of both active employees and retirees. This balance has been the hallmark of successful public pension agreements in the past, both in times of sacrifice and when there have been opportunities for benefit improvements. HF 2237 is a step in the right direction and we ask that you vote for it to be included in the omnibus pension bill. However, this bill still leaves significant unmet needs. The COLA study required by the 2018 pension bill showed inflation caused a significant loss in purchasing power over a retiree’s lifetime – and that was before the surge in inflation we recently experienced. Let me give you an example of someone covered by the MSRS General Plan who retired in 2015. When I add up the differences between their pension COLA and the Annual Rate of Inflation between 2017, the first year they were eligible for a COLA and 2024, that difference is 19 percent. If the February inflation rate of 2.8 percent continues throughout the whole year, the difference will be a loss of more than 20 percent over this 9 year period. So, when resources become available in the future, we ask that you remember and address the unmet needs of the public employees who work so hard to provide the high quality of life that all Minnesotans enjoy. Thank you for the opportunity to speak with you today. Michael J. Landers, Ed.D. Legislative Committee, Chair Minnesota Retired State Employee Association Fellow Members,
The Legislative Commission of Pensions and Retirement (LCPR) met for the first time this session on Tuesday, March 11. Here is a link to the commission members. https://www.lcpr.mn.gov/members.htm Presentations were made by each of the 4 retirement systems, MSRS, PERA, TRA and SPTRAFA. Copies of their presentations may be viewed by clicking on the appropriate link from the link to the agenda below. https://www.lcpr.mn.gov/meetings/agendas/2025/LCPR-20250311_agenda.htm The governing boards of MSRS and PERA recommended benefit enhancements. MSRS recommend increasing post-retirement benefits for MSRS General Plan members to 1.75% fixed beginning January 1, 2026. They also recommended increasing prospective multiplier of MSRS General Plan from 1.7% to 1.9% per year beginning July 1, 2025. The GOOD NEWS is that these proposals won’t require additional funding – costs can be absorbed by the plan. In terms of the other MSRS plans (Corrections, State Patrol, Judges), the Board authorized staff to collaborate with stakeholders regarding potential benefit modifications if appropriations are provided to fund the modifications. PERA staff is recommending that the PERA Board of Trustees supports a proposal to increase the General Plan postretirement benefit formula to 100% of CPI, 1.0% Minimum, 1.75% maximum with a provision to ensure contribution rates are not increased and the addition of a plan sustainability provision. The GOOD NEWS is that any costs associated with this proposal can be absorbed by the Plan. No member or employer rate increase will be needed. Although the Boards of TRA and SPTRAFA didn’t have specific proposals, Education Minnesota will be introducing legislation proposing an early retirement plan whereby a teacher reaching the age of 60 with 30 years of service will be able to retire without penalty. A large number of teachers were present to support the Education Minnesota proposed legislation and Education Minnesota is encouraging their members to attend every LCPR meeting. If MRSEA members want our voices to be heard, it is imperative that we show up at these meetings and advocate for our interests. If we don’t advocate for our interests, no one else will!!! LCPR meetings will be held Tuesdays at 5:00 in Room 123, State Capitol Building for the foreseeable future. This meeting was Standing Room Only and I expect future meetings will be full as well. Most of the attendees were advocating for the Teachers’ proposed legislation. So, if you plan to attend, PLEASE COME EARLY!!! Please note that the doors to the Capitol are locked at 5:00 p.m. so if you are going to attend, please make sure you are in the Capitol Building well before that time! Fellow Members,
Attached is a link to the 2025-2026 members of The Legislative Commission on Pensions and Retirement (LCPR). Although no meetings are scheduled as yet, it is not too early to contact them and let them know how inflation is eroding the value of your pension. If you are a constituent of any of these members, it is of even more importance that you contact them and ask them to partner with us in seeking relief. https://www.lcpr.mn.gov/members.htm It is unclear how the Minnesota House will proceed this session. As of 1-23-25, the several questions regarding this issue are before the Minnesota Supreme Court. All we can say at this time is “Stay Tuned”. As you may know, the vast majority of any actions regarding changes to public employee pension systems originate in the Legislative Commission on Pensions and Retirement, the LCPR. The LCPR is a bipartisan body composed of members of both parties from both the Minnesota House and Senate. Because of the uncertainty regarding the House, members of the LCPR have not even been named at this point. Check for updates, scheduled meetings, meeting agendas etc. at: https://www.lcpr.mn.gov/ When members of the LCPR are named, we will ask you to contact them, especially if you are a constituent, and let them know of your concerns. In the meantime, please contact your legislator and let them know how inflation has eroded the value of your pension over time. Several organizations such as AARP, Minnesota AFL-CIO, major political parties, etc. have issued summaries of the past legislative session. We borrowed heavily from these sources and are thankful to each of them. Our effort here is to present the highlights of the items that we believe are of most interest to our members.
PENSIONS
SECURE CHOICE
TAXES
PROPERTY TAX RELIEF
PAID FAMILY AND MEDICAL LEAVE
LIVE WELL AT HOME GRANTS, NEW INVESTMENTS IN HOME AND COMMUNITY-BASED SERVICES AND EXTENDING AGE-FRIENDLY GRANTS
PERSCRIPTION DRUG AFFORDABILITY BOARD
All Retired State Employees: Education Minnesota is holding a Pension Rally this coming Monday, April 3rd. The rally will be held in the Rotunda of the State Capitol from 3:45 – 4:45. Various legislators will be speaking. We believe it is the only rally for retiree pensions. MRSEA members might want to join in because the rally will highlight the need to compensate public employee retirees for losses to INFLATION. Monday is also the last meeting of the LCPR. The Commission will introduce and vote on a "Delete Everything" amendment, which will be the draft legislation that the LCPR will be recommending to the Legislature and the Governor. If accepted, retirees will wind up with a 2.5% one-time COLA payment. Attached below is a spreadsheet that shows the distribution of the total 600 million budget target the legislative leadership gave the LCPR. Below is a link to the LCPR that will allow you to view the amendment and the agenda for Monday’s meeting. Only written testimony will be accepted at this meeting. The link to viewing the meeting is also available on the LCPR home page. Some helpful links: www.lcpr.mn.gov – LCPR website www.house.mn.gov – where to find your state representatives and contact them www.senate.mn – where to find your state senators and contact them www.leg.mn.gov – where to find bills being considered by the legislature www.msrs.state.mn.us – MSRS website www.mrsea.org – MRSEA website. The latest information about the organization MRSEA – representing ALL RETIRED state employees!! 
  To find your legislatures' names and addresses mentioned above, click here:
https://www.gis.lcc.mn.gov/iMaps/districts/ To contact your MSRS board members, click here: https://www.msrs.state.mn.us/board-of-directors In a non-traditional approach to pensions this session, the Legislature is bypassing the Legislative Commission on Pensions and Retirement (LCPR) with bills making major modification to pension laws. With no meetings scheduled or LCPR proposals addressing general pension issues alive, some Commission members have submitted pension bills to House and Senate committees.
In the House, what started out as a $1 Billion bill by Rep. Mary Murphy is now less than half that. The good part is that Rep. Michael Nelson, chair of the State Government. Finance Committee, included Mary’s bill in the Omnibus State Government Finance Bill (HF 4953). The House passed the bill and a conference committee is working to craft a compromise that the House and Senate can agree on. However, the House and Senate have agreed on very little so far. One pundit said, “They aren’t even on the same planet on spending.” That does not bode well for pensions. We are only halfway to our goal of getting a good pension bill to the Governor’s desk. We saw progress in the House which passed HF 4293 that would provide lump-sum COLA (Cost of Living Adjustment) payments on Jan. 31, 2023 and 2024, equal to 2.5 percent of the previous years’ annual benefit. The bill would send $400 million to public employee pension plans to cover the cost of the lump sum payments and reduce the assumed rate of return (ARR) from 7.5 to 7 percent. Unfortunately, there is an eerie silence in the Senate. Senator Julie Rosen, chair of the LCPR, started out with a strong pension bill over a month ago. But that bill disappeared, LCPR meetings were cancelled, and nothing has been heard from the Senate on public employee pensions. The companion bills to the House bills are stuck in the Senate’s Ways and Means Committee. Rosen’s bill in the Senate would provide for a 1.5 percent permanent COLA and would reduce contributions by active educators by .5% but there is no progress at this time. The bottom line: your pension needs a little help from you! Please call or email your state representative and your state senator. They need to get the following message from YOU: “As a Minnesota retiree, I want you to know that we need help with inflation. I am on a fixed income and inflation is eating into my ability to live my life. . Please support a strong pension bill that raises our Cost of Living Adjustment so we can keep up with inflation. “ Here’s where to find contact information for your state senator and your state representative. https://www.gis.lcc.mn.gov/iMaps/districts/ Gov. Mark Dayton Thursday signed a bill to stabilize pensions for more than 500,000 workers and retirees in Minnesota. State officials call it a historic day, saying it is the largest pension reform legislation in state history. Both the Senate and House passed the bill unanimously.
The three year journey for the pension bill ended at six minutes before the deadline of midnight Sunday. The public pension funding bill passed the Senate 65-0 after it passed the House 131-0. The bill is now headed to Governor Dayton’s desk where he is expected to sign S.F. 2620 into law.
Minnesota takes its fiscal responsibility seriously. |
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