Ways and Means recommends Senate File 2884, an $80 million pension package, to general register

The Minnesota House Ways and Means Committee on a May 2025 meeting recommended Senate File 2884, a pension bill structured around an $80 million biennial target, to be placed on the general register.

The bill divides the $80 million target between public safety and education, makes changes to duty-disability benefits for some employees, and includes adjustments to how teacher pension-related aid is distributed to school-related entities. Committee members said the package reflects work by the state pension commission and TRA (Teachers Retirement Association) stakeholders.

Representative A. Lilly, sponsor of the bill, said the proposal is "a product of the pension commission," and praised commission and staff work on the measure. Representative D. Driscoll (co-chair of the commission) told the committee the $80 million target was agreed among education and public-safety stakeholders. He said the state patrol shifted its cost-of-living adjustment (COLA) from 1% to 1.25% and that police and fire provisions moved up the delay in their COLA by one year. Driscoll also described a 2% base increase in benefits intended to help retirees who do not participate in Social Security.

On duty-disability rules, Representative P. O'Driscoll explained the bill's changes and protections for current beneficiaries: "Anyone who currently is on duty disability as of the date of enactment on this has no change in benefits whatsoever. Prospectively, what happens is if you are a person who is permanently but not totally disabled, you're given a 5 year window of disability benefits and 5 years of insurance, meaning that you would still be able to maybe transition to a different career on there." He said stakeholders have raised concerns and that members are forming a work group to continue discussions.

Representative Joaquin asked staff about the fiscal tracking. Nonpartisan staff member Miss Averill pointed to a tracking document included in the committee packet that outlines how appropriations flow. She said specific annual amounts included in the Teachers Retirement Association section: the Department of Education $4,000 per year, the Minnesota State Academies $17,000 per year, the Perpich Center for the Arts $5,000 per year, and Minnesota State Colleges and Universities (MNSCU) $543,000 per year. Averill also said the general-education aid pension adjustment totals "just over $17,000,000 in fiscal year 2026," with ongoing amounts reported as approximately $19.7 million and $19.6 million in subsequent years in the tracking document provided to the committee.

Representative Novotny raised concerns about individuals on duty disability who are "permanently but not totally disabled" and their access to health insurance if they lose employer coverage; members and sponsors said they intend to continue work on that matter in the interim and next session.

With no further discussion, Representative Lilly moved that Senate File 2884 be recommended to the general register. The motion prevailed on a voice vote and the committee recommended the bill to the general register. The committee also approved minutes from the May 15, 2025 meeting earlier in the session.

Committee chairs closed by thanking nonpartisan staff and members; chairs said the committee likely will not meet again this year.