May 31, 2018 06:05 PM
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.
According to the Minnesota State Retirement System, the law fixes more than $700 million in funding deficiencies in the general, correctional, and state patrol retirement plans caused by longer life expectancies.
It also reduces the rate of return.
Dayton said the new law ensures public employees will receive their pension moving forward.
"This is a Herculean effort by everybody pulling together, really going into the deep details of what needed to be done, making concessions, and giving up things they thought were important for the sake of an agreement everybody can support," he said.
Republican State Sen. Julie Rosen said the law eliminates $3.4 billion of unfunded liabilities, a recommendation from ratings agencies.
Lawmakers are confident this will allow state amd local municipalities and school districts to borrow at a more competitive rate.
"It is going to change not only the pensions and security for pensioners ongoing, but our financial stability in the state and that’s what’s more important," Rosen said.
Not everyone agrees, however.
"It's a bailout because we have tens of millions of dollars coming out of the general fund now propping up these funds, especially the teachers fund," says Kim Crockett of the Center of the American Experiment, a conservative group that views most public pension plans as unsustainable in the long term.
Dayton said it is the last bill he will sign into law as governor.
Updated: May 31, 2018 06:05 PM
Created: May 31, 2018 12:21 PM
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