Legislative Highlights

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

• Those covered by the MSRS coordinated plan (that is, those who also receive Social Security), will receive the difference between 2.5% and the statutorily established COLA, which as of January 1st will be 1.5%. So, the net increase will be a 1% one-time non-compounding payment.  It will be paid out during the first quarter of 2024.
• Those covered by the MSRS basic plan (that is, those who do not contribute to nor receive Social Security), will receive the difference between 4% and the statutorily established COLA.  Within MSRS, this group includes only State Patrol retirees, and they will receive a net one-time, non-compounding 3% payment which will also be paid out during the first quarter of 2024.
• For early retirees, the provision that delayed their COLA until they reached full retirement age, was removed.
• The “return on investment” assumption was reduced from 7.5% to 7%.  This will not require any contribution increases but it will delay the time it will take for the plans to reach full funding.
• Several other minor provisions, such as: 1) judges will receive more time to buy back retirement year credits; 2) one-time money to the general plan to decrease unfunded liabilities; and 3) money to fund law enforcement and fire fighters disabilities (state patrol members, in the case of MSRS).
• A two-year temporary 0.5% contribution shift from employee to employer.

 
SECURE CHOICE

• This establishes an auto-IRA program for employees without any other retirement savings plan.  The law requires employers with five or more employees, who do not offer a retirement plan, to enroll their workers in the state’s IRA plan managed by the Minnesota State Board of Investment.
• This is important to us because if public sector employees are the only employees with retirement plans, it will be harder and harder to maintain them and to have the general population support our pensions.

 
TAXES

• Social Security tax relief has been provided to 76% of seniors.  Social Security taxes will be eliminated for earnings up to $100,000 for couples and $78,000 for singles. It also provides partial relief for earners over these income thresholds phasing out at $140,000 for couples and $118,000 for singles.
  

PROPERTY TAX RELIEF

• Renter’s credit has been expanded, allowing renters to file at the same time as they file their income taxes.
• Homestead exclusion and homestead credit (including ongoing and one-time relief) has been expanded.  There has been an expansion of the senior citizen property tax deferral program and targeted relief for homeowners who may have experienced a spike in property taxes.

 
PAID FAMILY AND MEDICAL LEAVE

• Workers can take up to 12 weeks for bonding and family leave and up to 12 weeks for their own serious medical condition, up to a maximum of 20 weeks each year.  Workers are allowed to use the leave to care for someone unrelated by blood or marriage, such as a significant other, neighbor or friend.
• Starting on January 1st of 2026 workers and employers will be required to pay a .035% payroll tax, about $175 a year for someone who makes $50,000.  However, businesses that offer a private plan with equal or better benefits could opt out.  The law also provides small businesses with premium support and grants to help hire temporary workers, job protections after 90 days of employment, and a progressive wage replacement of up to 90% of wages for low-income workers.  This will make Minnesota the 12th state, along with the District of Columbia, to offer paid leave.

 
LIVE WELL AT HOME GRANTS, NEW INVESTMENTS IN HOME AND COMMUNITY-BASED SERVICES AND EXTENDING AGE-FRIENDLY GRANTS

• In response to the long-term care worker crisis, significant investments were made in programs serving older Minnesotans, including the Elderly Waiver, Alternative Care, and Personal Care Attendant (PCA) programs.
• Increased funding for Senior Nutrition, Age-Friendly community and technical grants.
• Live Well At Home grants were extended beyond one-year up to two to seven years to create sustainable programs to care for seniors in their homes.

 
PERSCRIPTION DRUG AFFORDABILITY BOARD

• The Prescription Drug Affordability Board has been created to help citizens struggling to afford their prescription drugs.  The Board will prohibit price gouging by pharmaceutical companies by setting upper payment limits for drugs sold in Minnesota, reducing costs for consumers, governments, health plans, and other stakeholders.