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HF3052 (Legislative Session 94 (2025-2026))

Teachers Retirement Association; unreduced retirement annuity provided upon reaching age 60 with 30 years of service, early retirement reduction factors modified for annuity commencement before normal retirement age, postretirement adjustments increased, other various retirement provision modified, and money appropriated.

AI Generated Summary

Purpose of the Bill

This bill aims to make several important changes to the retirement benefits for members of the Minnesota Teachers Retirement Association. It focuses on adjusting retirement annuities, modifying early retirement penalties, increasing post-retirement adjustments, and enhancing pension-related contributions and revenues for school districts.

Main Provisions

  • Unreduced Retirement Annuity: Allows teachers to receive a full retirement annuity at the age of 60, provided they have completed 30 years of service.

  • Early Retirement Modifications: Alters the reduction factors for annuities that begin before the normal retirement age, which would potentially result in less financial penalty for those opting for early retirement.

  • Post-Retirement Adjustments: Increases post-retirement adjustments making it financially more favorable for retired teachers, and removes the delay of these adjustments for those who retire before reaching the normal retirement age.

  • Employer Contributions: Requires an increase in employer contributions to sustain the enhanced retirement benefits.

  • Pension Adjustment for School Districts: Updates the pension adjustment revenue calculations for school districts, which includes tiered adjustment rates over several fiscal years.

Significant Changes to Existing Law

  • Amendments to Minnesota Statutes: The changes affect several sections of Minnesota Statutes 2024, specifically altering the formulas and revenue rates affecting pension adjustments.

  • Change in Pension Adjustment Rate: For Independent School District No. 625 Saint Paul, the pension adjustment rate is set to increase gradually from 2.5% in fiscal years 2024 and 2025 to 3.25% in 2026 and later. For all other districts, this rate will increase from 1.25% in fiscal years 2024 and 2025 to 5.8% by fiscal year 2026 and later.

  • Cooperative Units: Cooperative educational units are now treated as districts for pension adjustment revenue purposes, qualifying them for the same rates.

Relevant Terms

  • Teachers Retirement Association
  • Unreduced Retirement Annuity
  • Early Retirement Reduction Factors
  • Post-Retirement Adjustment
  • Employer Contributions
  • Pension Adjustment Revenue
  • Cooperative Unit

Bill text versions

Actions

DateChamberWhereTypeNameCommittee Name
April 01, 2025HouseFloorActionIntroduction and first reading, referred toState Government Finance and Policy

Citations

 
[
  {
    "analysis": {
      "added": [
        "New fiscal year pension adjustment rates are specified for fiscal years 2024 through 2028 and beyond."
      ],
      "removed": [
        ""
      ],
      "summary": "This bill modifies pension adjustment revenues for school districts under section 126C.10, subdivision 37.",
      "modified": [
        "Updates the pension adjustment revenue calculations and caps for fiscal years 2025 and beyond."
      ]
    },
    "citation": "126C.10",
    "subdivision": "subdivision 37"
  },
  {
    "analysis": {
      "added": [
        "Cooperative units are treated as districts for pension adjustment revenue distribution."
      ],
      "removed": [
        ""
      ],
      "summary": "This bill refers to exceptions regarding cooperative units for pension adjustment revenue under section 123A.26, subdivision 1.",
      "modified": [
        "Clarifies the distribution of aid generated by cooperative units."
      ]
    },
    "citation": "123A.26",
    "subdivision": "subdivision 1"
  },
  {
    "analysis": {
      "added": [
        ""
      ],
      "removed": [
        ""
      ],
      "summary": "This bill references the definition of cooperative units under section 123A.24, subdivision 2, in relation to pension adjustment revenue.",
      "modified": [
        ""
      ]
    },
    "citation": "123A.24",
    "subdivision": "subdivision 2"
  }
]

Sponsors