2018 pension bill passes MN Senate

March 26, 2018

Minnesota Senate OKs 2018 pension bill

The 2018 Omnibus Pension Bill passed out of the Minnesota State Senate on a unanimous vote (66-0) on Mon., March 26. The bill will next proceed through various committees in the state House of Representatives, most likely after the Easter/Passover break. 

Bill co-author Sen. Julie Rosen, R-Vernon Center, who chairs the Legislative Commission on Pensions and Retirement (LCPR), summarized the bill’s provisions and praised the engagement of those who have worked for three years to bring forward a public pension sustainability package whose reforms will result in $3.4 billion in immediate savings.

To help address the pension systems’ unfunded liabilities, SF 2620 includes “significant benefit reforms” as well as contribution rate increases for employers and employees, Rosen said. She explained that the bill has much work behind it – the engagement of all stakeholders, the governor, the commissioner of Minnesota Management and Budget – and reflects “true shared sacrifice.”

Rosen noted that bond ratings agencies are watching Minnesota closely and expect pension reform. The sustainability package moving through legislature is the largest in Minnesota pension history, she said.

LCPR member Sen. Sandy Pappas, D-St. Paul, added her support for the bill. Pappas said the funding situation for Minnesota’s public pension plans is “serious” and “not adequate.” She said that passage of the bill will come as welcome news to bond ratings agencies such as Moody’s and S&P, which are paying close attention to the issue. Pappas said that the reforms also will be good for Minnesota as a whole.

Pension commission members Sen. Dave Senjem, R-Rochester, and Sen. John Jasinski, R-Faribault, also spoke in support of the bill.

The bill includes sustainability measures for all four public pension systems: the Teachers Retirement Association (TRA), the Public Employees Retirement Association (PERA), the Minnesota State Retirement System (MSRS), and the St. Paul Teachers Retirement Fund Association (SPTRFA). Details on the bill may be viewed on the State Legislature website: https://www.revisor.mn.gov/bills/text.php?version=latest&session=ls90&number=SF2620&session_year=2018&session_number=0 (Senate version).

Besides the immediate $3.4 million reduction in pension liabilities, the bill puts the plans on the path toward full funding, provides funding to schools to offset increased pension contributions, and safeguards the retirement security of public employees for the future. The bill lowers the rate of return on investments to 7.5 percent. Here are the key provisions of the pension bill pertaining to TRA:

KEY TRA PENSION BILL PROVISIONS

COLA: 1.0% for 5 years (2019-2023), then increase by 0.1% per year in each of next five years (2024-2028) to 1.5%

COLA delay to age 66  (effective 7/1/2024) (exempt: Rule of 90, disability, survivors, age 62/30 years)

Early retirement: Increase penalties, 5-year phase-in (fiscal years 2020-2024), age 62/30 years exempt

Employee contribution increase: +0.25% beginning in FY2024 (7.5% to 7.75%)

Employer contribution increases: +1.25% phased in over 6 years, FY19-24 (7.5% to 8.75%)

AFT Statement on the Passing of Linda Brown

For Immediate Release
March 28, 2018

Contact:
Oriana Korin
202-879-4723
okorin@aft.org
www.aft.org

AFT Statement on the Passing of Linda Brown

WASHINGTON—Statement of American Federation of Teachers President Randi Weingarten on the death of Linda Brown, whose enrollment in an all-white Kansas school was blocked, inspiring the landmark 1954 Supreme Court case Brown v. Board of Education:

“At a moment in history when young students are leading fights for safe schools with incredible moral courage, we are reminded of a young Linda Brown, who also stood at the epicenter of a movement for moral justice. She did so with immense courage, and her story changed the definition of equality in our country forever.

“On the 60th anniversary of the Brown v. Board of Education decision, I was in Topeka, Kansas, Brown’s hometown, to support the fight against Gov. Sam Brownback’s draconian disinvestment from public education, the same way the AFT was there in the 1960s, sending supplies and resources to the schools, and opening them to serve African-American students who were still being locked out, despite the court’s decision in the Brown case. We were there fighting for something that Brown had set in motion decades before.

“With the right support, we can continue to make America’s public schools the thriving communities of learning that Brown and her family fought for. Let that be her legacy.”

AFT Statement on Immigration Status Question Added to 2020 Census

For Immediate Release
March 27, 2018

Contact:
Oriana Korin
202-374-6103
okorin@aft.org
www.aft.org

AFT Statement on Immigration Status Question Added to 2020 Census

WASHINGTON—AFT President Randi Weingarten issued the following statement in response to the news that the 2020 census would include a question on citizenship status:

“This is a hateful and bigoted attempt by the Trump administration to intimidate immigrant communities using taxpayer money. The census helps determine where government resources are directed and how congressional representation is divided, and any attempts to undermine that process point to a racist, elitist government hell-bent on excluding certain voices from our democracy.

“A citizenship status question will have a chilling effect on census participation and will re-create the long shadows that noncitizens will once again move into. That hurts the economy and hamstrings local and state services, which sadly seems to be what this White House wants. But a nation built by immigrants should welcome the engagement of those in pursuit of the American dream, not kick the ladder out from under them.”

AFT Supports Student Non-Discrimination Act

For Immediate Release
March 22, 2018

Contact:
Oriana Korin
202-879-4726
okorin@aft.org
www.aft.org

AFT Supports Student Non-Discrimination Act

WASHINGTON— Statement of American Federation of Teachers President Randi Weingarten in support of the Student Non-Discrimination Act:

“The AFT has always advocated proudly for LGBTQ students, and we endorse this bill to prohibit discrimination against them in school programs. No child should fear being barred from a school program or denied the resources to participate simply because of who they are, and all students deserve a safe, supportive educational environment where they are treated equally and fairly.

“Yet we know that a much harsher reality still persists for too many of our LGBTQ students. Our federal government must work with schools to create safe, inclusive and welcoming learning environments, free of bullying and harassment, and the AFT stands behind this bill’s efforts to deny federal funds to schools offering anything less.”

Call for MSCF member to serve on Ad Hoc Accessibility Committee

Accessibility Committee (ad hoc) Charter

Type of group:  Committee (Ad hoc)

Charge: (Indicate the main purpose of the group)

Develop sustainable campus practices for addressing the accessibility of electronic (and printed) information to include website and course materials made available at colleges and universities in the Minnesota State system. The committee will study the current state of accessible materials for all learners and web site visitors and make recommendations for improving access to and the distribution of web site and instructional materials in accessible formats.

Roles & Responsibilities: (What tasks/milestones will this group achieve?)

• ·         Investigate the current state of accessible materials and website accessibility within the Minnesota State system of colleges and universities
• ·         Investigate campus-based (local and national) accessibility practices and initiatives and identify competencies and best practices for such initiatives
• ·         Investigate processes, products, and practices for creating accessible websites and documents and content in online or web-based courses within Minnesota State
• ·         Develop campus engagement plans to encourage cross-institution communication and collaboration on website accessibility and the creation of accessible materials

Scope (i.e., boundaries of the project)

·         In Scope: 

·         Out of Scope:  

Duration and Time Commitment: (How long will this group be meeting, how often?)

• ·         10 - 1 ½ hour meetings each academic year (August-May)
• ·         Additional time will be required outside of meetings to prepare for and investigate agenda items

Membership: (Indicate how membership in the group is determined and who is leading the group

Committee membership is open to Technology Council members and non-council members comprised of individuals representing various relevant roles across institutions, including instructional technologists, web specialists, accessibility/disability services directors or specialists, administrators, faculty, students, and others. And they represent people with one or more of the following:

1. Prior experience in the creation and adoption of accessible institutional materials
2. Experience or interest in assuring web-based materials meet accessibility requirements

There must be at least one Technology Council member on this committee. 15 Voting Members

IFO(1) IFO/1	MSCF (1) MSCF/1
MAPE or MMA (1) MAPE or MMA /1	MSUAASF (1) MSUAASF /1
LeadMN (1) LeadMN/1	Students United (1) Students United/1
Administrators, College (1) Administrator, College/1	Administrators, University (1) Administrator, University/1
System Office Staff (2) System Office Staff/1 System Office Staff/2	At Large (5) * (Would like to recommend 6; rationale in email dated Feb 22) At Large/1 At Large/2 At Large/3 At Large/4 At Large/5
System Office Staff (2) ex officio System Director for Student Development and Student Services (1) – ex officio Program Director for Learning and Next Generation Technologies (1) – ex officio

*Denotes lead responsible for coordinating meeting dates, schedules.

Expectations of Committee Members:  Members are expected to:

• ·         Attend and participate in meetings as scheduled.
• ·         Represent the positions of their constituents.
• ·         Work with all members to build consensus in committee decisions and recommendations.
• ·         Provide recommendations to the ASA-Technology Council that meet student, institutional and system needs.
• ·         Communicate discussions and recommendations back to their constituents.

Resources: (what will the group need access to in order to do their work?)

• ·         Web conference service to hold monthly meetings

Consultation Process: (how will the work of the group be communicated and to whom?)

• ·         Recommendations from this committee (ad hoc) will be submitted to the ASA-Technology Council
• ·         Chair of the committee (ad hoc) or designee will be provide reports of monthly meetings to the ASA-Technology Council regarding recommendations of the committee (ad hoc).

Links: (List other groups or projects that are linked to the work of this group)

•          ASA-Technology Council
•         ASA-Academic Affairs Council
•          ASA-Student Affairs Council
•          ASA-Policy Council
•          Accessibility Directors Affinity Group

System Office Staff Support:  N/A

Questions or Clarification: (who should people contact if they have questions about the group?)

Lesley Blicker, Program Director for Learning and Next Generation Technologies

651-201-1413 or Lesley.Blicker@minnstate.edu

Paul Shepherd, System Director for Student Development and Student Services

651-201-1743 or paul.shepherd@minnstate.edu

If you are interested in representing MSCF on the ad hoc Accessibility Committee, please email Kevin at kevin.lindstrom@edmn.org as soon as possible.

3/15 edition, Pension Issues in the News

MARCH 15, 2018

MINNESOTA NEWS + OPINION

Viewpoint: Calling for caution and a focus on the basics

Woodbury Bulletin

The core functions of government need to operate efficiently. We've seen here in Minnesota and elsewhere that neglecting the basics can have serious repercussions. This year we need to shore up our outstanding pension obligations. To ignore those responsibilities puts retirees and their families at ...

Teachers Pension, on Downward Slide, Wants to Lower Return Assumption

Center of the American Experiment

The Teachers Retirement Association (TRA), which manages pensions for the majority of teachers in Minnesota, told legislators last month that it wanted to drop its assumed rate of return from 8.5 to 7.5 percent. TRA is the last public fund in the entire United States to assume its assets can earn 8.5%.

Minnesota projects $329 million surplus amid federal tax changes, spending decisions

Minneapolis Star Tribune

Both DFL and GOP legislators said they need to adapt the state tax code to federal changes, fix the vehicle licensing and registration system, improve school safety and address underfunded public employee pensions. This legislative session will likely include many debates over how exactly to address ...

'Limited' surplus means tough decisions ahead for Minnesota lawmakers

MinnPost

Lawmakers are also dealing with the state's problem-plagued licensing and registration system, which could need up to $43 million in emergency funding to get back on track. There's also a desire to shore up the state's obligations to its pension plan holders. A pension bill currently under consideration ...

NATIONAL NEWS + OPINION

Wisconsin public employee pensions to rise at least 2.4 percent

Madison.com

Retired public employees across the state who participate in the Wisconsin Retirement System will get bigger pension checks, starting May 1. All 203,000 retirees in the Wisconsin Retirement System (WRS) are due for a 2.4 percent increase in their payments from the Core Trust Fund, the main fund, the ...

NCPERS Honors 164 Public Pension Plans for Contributions to Improved Transparency

Business Wire (press release)

“The business intelligence provided by the 164 study participants supports efforts by the public pension community as a whole to comprehend and analyze challenges and find opportunities for steady improvement,” Kim said. Pension plans can access the study in “dashboard” format, enabling them to ...

Why Are Lawmakers Debating PERA? Here's What You Need To Know

Colorado Public Radio

A legislative committee will take its first pass at Senate Bill 200, 57 pages of dense public policy meant to majorly overhaul Colorado's Public Employee Retirement Association, the state's pension fund. There are bipartisan sponsors, and yet, even as lawmakers unveiled the bill, they acknowledged it ...

New Haven will look to borrow $250 million to fund pension liability

New Haven Register

The pension discussion came at the end of the first public hearing on the city's fiscal 2019 $547 million budget proposal that represents a 1.52 percent increase over the current year and an 11 percent hike in the tax rate to 42.98 mills. The proposed capital fund is $79 million. Acting Budget Director ...

State's teachers deserve fairness

Scranton Times-Tribune

A new Economic Policy Institute study by Jeffrey Keefe, a Rutgers University professor emeritus, finds that Pennsylvania's public school teachers earn 6.8 percent less, even after accounting for pension benefits, than similarly educated and skilled workers in the state. Looking to the future, Keefe finds that ...

Nevada Supreme Court to rule on years-long dispute over transparency of state's public pensions

Watchdog.org

The Nevada Policy Research Institute (NPRI) has been battling the state since 2015, but the legal battle began in 2011 when the Reno Gazette-Journal (RGJ) filed a lawsuit after its request was denied to receive copies of PERS records documenting public pension recipients and their benefits. Carson ...

Washington state's public pensions include $5.3M in gun-related investments

Seattle Times

By comparison, the state's pension funds' largest single stock holding is $573.3 million in Apple, a 1.65 percent stake of total public-equity investments for Washington retirement plans. Olin Corp. licenses the production of Winchester firearms and it manufactures ammunition. Sturm, Ruger & Co. makes ...

Education savings accounts get a public hearing, drawing local and national experts

Yankee Institute (blog)

Education savings accounts get a public hearing, drawing local and national experts ... Connecticut also faces a growing crisis in its teacher pension system. The costs of teacher pensions is projected to grow from $1.2 billion per year to potentially $6 billion per year and represents one of the fastest ...

Oregon Passes Law to Boost Public Pensions

Chief Investment Officer

Oregon Gov. Kate Brown has signed into law a bill that establishes two funds to help the state's schools and other public employers cover growing public pension costs. One of the funds would receive the majority of the money, as much as several hundred million dollars by some estimates, which would ...

Noteworthy In 2017: School Pensions Reformed, No Annual Contribution Shortfall

Michigan Capitol Confidential

For the first time in eight years, the state of Michigan put more money into its public schools employees' pension fund than accounting rules require. Contributing less than that in most years is how a pension funding shortfall has grown large. The state contributed $2.4 billion to the Michigan Public ...

EDITORIAL: 401(k)s aren't the solution to Illinois governments' pension woes

Chicago Sun-Times

Without big public pension funds, such as those in Illinois, investors would lose leverage. They could expect to see their savings gain less value over time. Only money managers and others in the financial class would be happy about that. Yes, Illinois has a big pension problem. Massively underfunded ...

Retired Teachers Group Aims To Educate Legislators

Hartford Courant

27, to learn about the pension and health insurance crisis facing retired teachers in the state. The event was ... Active teachers saw a one percent increase in their pension contribution as of Jan. ... Alice Deloge worked in several jobs before she started teaching in the Killingly public schools. She was ...

The Real Reason the Investor Class Hates Pensions

New York Times (blog)

For example, the nation's largest traditional pension, the California Public Employees' Retirement System, known as Calpers, has 1.9 million members and over $300 billion in assets. When it calls up an investment manager to complain about performance, or to dump that manager, or when it calls a ...

Public funds have long advocacy for gun safety

Pensions & Investments

Responding to an inquiry from a state senator on how much the $34.2 billion Connecticut Retirement Plans & Trust Funds had invested in gun companies and the process to divest, Denise L. Nappier, state treasurer and sole trustee of the retirement plan, said she is in the process of engaging with gun ...

Active investing marks return as asset owners focus on outcomes

Pensions & Investments

"Rather than bundling public equity separately, they're bucketing them together in a broader movement around outcomes." And matching liabilities is no longer just associated with corporate defined benefit plans. J. Tyler Cloherty, Darien-based senior manager at Casey Quirk, said public pension funds ...

'Widespread misunderstanding': Pension funds face scrutiny over climate risk fiduciary duty

www.businessgreen.com

They must also review ethical and environmental risks to their investments at least every three years under existing pensions regulations, Opperman explained. "Given that there is a broad scientific and public policy consensus that climate change is such a risk, then trustees already have a duty to take ...

Connecticut Pensions May Sell Gun Stakes If Companies Don't Tighten Controls

Wall Street Journal

Public pensions, often the target of political pressure, increasingly invest with an eye toward the public scrutiny that can come with exposure to certain companies or industries. They also face criticism that holding stakes, even small ones, in firearms makers could make them complicit in gun violence.

Michigan pension system unloads gun shares, sells Olin Corp.

Crain's Detroit Business

As of this week, Michigan's public employees no longer own gun shares. The State of Michigan Retirement System, which manages $70 billion in pensions for educators, police and other public employees, on Monday sold its holdings in chemical company Clayton, Miss.-based Olin Corp. (NYSE: OLN) ...

Panel of business leaders urges Connecticut lawmakers to make sweeping changes

New Haven Register

Donald Williams, executive director of the Connecticut Education Association and a former president of the state Senate, said one of the recommendations he did agree with is the plan to use proceeds from lottery solely to fund teacher's pensions. But Williams said other recommendations take “away the ...

BlackRock says it's time to take action on guns, may use voting power to influence

CNBC

The world's largest asset manager details its approach to the gun industry in a three-page letter in response to overwhelming customer interest. BlackRock says it is showing customers options for changing their investments to exclude stocks of gun makers and is considering new funds that don't invest ...

New Jersey treasurer resets public pension rate of return

Reuters

NEW YORK (Reuters) - New Jersey's treasurer said on Thursday she will increase the expected rate of return for the state's struggling public pension system from 7 percent to 7.5 percent, then lower it again over time. The switch to a higher assumed rate means that the state, and participating local ...

AFT President Randi Weingarten Calls for Passage of the STOP School Violence Act of 2018

For Immediate Release
March 14, 2018

Contact:
Oriana Korin
202-374-6103
Oriana.Korin@aft.org
www.aft.org

AFT President Randi Weingarten Calls for Passage of the STOP School Violence Act of 2018

WASHINGTON—The AFT sent a letter to Congress today to express support for H.R. 4909, the STOP School Violence Act of 2018. AFT President Randi Weingarten also issued the following statement:

“Safe schools require more than words or thoughts and prayers. This bill is a solid step toward helping schools be safe sanctuaries for teaching and learning—but there is much more work to be done. We must invest in prevention: mental health supports for students and educators, more counselors, after-school activities, and programs like peer counseling, wellness programs and other social supports. Equally important, we need commonsense gun safety legislation that is supported by huge majorities of Americans, even gun owners.

“Today, teachers and school personnel around the country are supporting student-led walkouts to make clear that we will not rest until we see action to stop gun violence in our schools. I was honored to join students at New York City’s Leadership and Public Service High School for their walkout to Zuccotti Park. These kids are fighting for their lives. They aren’t intimidated by the NRA, and unlike the White House, they are committed to change. To them, enough means enough, and I am inspired by their actions and unity to make change happen. It’s time to value our children more than guns.

“We will not rest until we see action—and that includes, as the students said today, helping people to register to vote and voting for people in November who stand with students, parents and teachers, not the gun industry.”

The full text of the letter can be found here.

3/13 legislative recap: Pension commission OKs sustainability bill

March 13, 2018

2018 sustainability bill passes out of pension commission

The Legislative Commission on Pensions and Retirement (LCPR) on Tues., March 13, passed the 2018 omnibus pension bill. The next stop for the bill is the Senate State Government Finance Committee, which will hear it on Thurs., March 15, at 1 p.m. in Room 1200 of the Minnesota Senate Building.

The bill includes sustainability measures for all four public pension systems: the Teachers Retirement Association (TRA), the Public Employees Retirement Association (PERA), the Minnesota State Retirement System (MSRS), and the St. Paul Teachers Retirement Fund Association (SPTRFA).

Details on the bill, currently moving as SF 2620 / HF 3353, may be viewed on the State Legislature website: https://www.revisor.mn.gov/bills/text.php?version=latest&session=ls90&number=SF2620&session_year=2018&session_number=0 (Senate version).

Minnesota Management and Budget Commissioner Myron Frans told commission members that Gov. Mark Dayton endorses the pension bill in its current form and will include the funds in his supplemental budget. Frans said the bill is a “very important sustainability package” that has been several years in the making and includes measures to improve the financial health of the pension funds and the state.

The bill reduces liabilities by about $3.4 million immediately, lowers the rate of return on investments to a “reasonable” 7.5 percent, puts the plans on the path to full funding, provides funding to schools to offset increased pension contributions, ensures that unfunded liabilities won’t weigh down bond ratings, and safeguards the retirement security of public employees for the future, Frans said.

Here are the key provisions of the pension bill pertaining to TRA:

KEY TRA PENSION BILL PROVISIONS

COLA: 1.0% for 5 years (2019-2023), then increase by 0.1% per year in each of next five years (2024-2028) to 1.5%

COLA delay to age 66  (effective 7/1/2024) (exempt: Rule of 90, disability, survivors, age 62/30 years)

Early retirement: Increase penalties, 5-year phase-in (fiscal years 2020-2024), age 62/30 years exempt

Employee contribution increase: +0.25% beginning in FY2024 (7.5% to 7.75%)

Employer contribution increases: +1.25% phased in over 6 years, FY19-24 (7.5% to 8.75%)