Senate committee hears bill proposing $300 million pension reserve and changes to interest flows

Senate Bill 287 would create a pension reserve and adjust how Montana uses interest earnings to help shore up the public employees— and teachers— retirement systems, sponsor Sen. Wendy McKamey said at a Senate Finance and Claims hearing.

The bill would provide a one-time general fund transfer of $300,000,000 to a newly funded pension state special revenue account and let that account retain its interest earnings. It also would continue directing 50% of Treasurer—s Cash Account (TCA) interest to the debt-and-liability-free account and 50% back to the general fund; under current law, the full flow returns to the general fund in fiscal 2026. The debt-and-liability-free account would be allowed to transfer unobligated balances above $150,000,000 at the end of each biennium into the pension reserve.

The proposal also would permit the debt-and-liability-free account to purchase low‑interest subsidized loans currently in the coal trust permanent fund and would phase in a 0.2…