Category: Pension & Legislative Updates

Another Minnesota legislative session has come to an end and it’s another MAJOR disappointment for members looking for the drastic improvement needed in our TRA pension. The only change of substance was what I had mentioned in my earlier update. For members who were active as of May 24, 2023 they will be able to retire at age 65 with no penalty starting July 1, 2024. WOO HOO! Oh, and we are paying for this one ourselves! Our contribution rates are slated to go up another .25% next July. Now instead of teaching 9 years longer than our former colleagues, we only have to teach 8 more years. All that with higher than ever contributions on our end!

So is there any hope? I’m really not sure at this point. I have contacted legislators and spoke to as many people as I can about it, but there is never any movement. They wouldn’t even entertain a bill by Representative Nadeau that would have allowed us to retire at 62 years of age and 30 years experience and pay for it OURSELVES. Still rejected. That one really pissed me off. Funny that they let us pay for the ability to retire at 65, but NOT at 62. Hmm. I wonder why that is. They allowed the St. Paul TRA to do that after last session. I am holding out hope that Ted Seidle’s investigation into the fund gives us some kind of yarn to pull, but I’m really not going to hold my breath on that. I’m afraid he will find decisions that may be “unethical” but completely legal so we will have no recourse. There’s been talk in Facebook groups about trying to organize a state-wide strike to show legislators that the time for action is now, but apparently it is against state law to organize a state-wide walk out. I’m also not sure it would help us. It could end up backfiring, but they really don’t have anyone to replace us. I remember Reagan ending the air traffic controller strike in the 80’s by firing them all. Ha! Good luck firing all the teachers that join the walkout! You can’t find anyone to replace the ones that are lucky enough to be retiring. Maybe the people calling for a state-wide walkout are onto something.

Another Minnesota legislative session is upon us, and it seems it’s going to be ANOTHER major disappointment for Minnesota’s Tier 2 teachers. Minnesota has an every other year bonding cycle, so this year is not a year for adding much in new monies. This meant it was always a long shot to get meaningful reform this year. After yesterday’s Legislative Commission on Pension Reform meeting, the only change to TRA pension was to move the change from Normal Retirement Age (NRA) of 66 to 65 from starting in 2025 to 2024. This is “technically” an improvement, but not really and here’s why…

The only rule Tier 2 teachers currently have is 62/30. This means you can retire IF you are at least 62 years old and have taught for 30 years. You would THINK that would be considered a career, but no. You still forfeit 14% of your pension (10.4% when NRA moves to 65). None of our neighboring states penalize their teachers for putting in a FULL CAREER! In fact, St. Paul’s Teacher Retirement Association got their 62/30 approved in last year’s session and it took effect this year. Why can’t it work for the rest of the state??

What most Tier 2 teachers are looking for is a career rule like 62/30 or even 60/30 that is penalty FREE! We also believe there is a need for a mid-career rule for someone who started teaching later in life where they can retire and still receive a penalty free pension.

It’s true that the session isn’t over yet, and there could be a last second Hail Mary that could make Minnesota’s pension comparable with neighboring states. Maybe Ted Siedle’s investigation into the handling of investments will reveal wrongdoing on the state’s behalf and will force them into action. But we won’t know the final picture until the last day of the session which is May 20th. Whatever happens, I will post an update at the end of the session, but until then, KEEP STACKIN!!

Hey everyone! It’s been quite a while since I’ve posted anything on the site. Lots of things happening in my world right now. A big one which I will plan on posting about in the coming weeks. The purpose of this post is to talk about what is happening at the MN Legislature in regards to TRA and how it will affect our pensions.

Coming into the 2023 session, a big push was to improve pensions for current TRA members.  Most current teachers don’t realize that they can’t retire without any kind of penalty until they are 66 years old! There is a “62/30” rule in place where you can retire at 62 years of age with at least 30 years of experience, but that only gives you a “reduced” penalty. I have posted on that before here. There were a couple of bills proposed to fix our current retirement which is the 3rd worst in all of the country! One of the bills which TRA supported was to change to a “60/30” model which would have allowed someone to retire and age 60 and at least 30 years of experience with no penalty. The other bill was supported by Education Minnesota and was a “62/35” bill. This would have allowed someone 62 years old OR 35 years of experience to retire with no penalty. Either bill would have been far better than our current system.

Unfortunately, Governor Walz only designated $600 million to fix public pensions. This money had to be split among ALL the pension groups in Minnesota; police, firefighters, judges, public employees, etc… AND it had to cover a COLA (cost of living adjustment) for all current retirees. Obviously, this was not NEARLY enough money to cover all of these areas, and unfortunately neither bill made it into the Pension Omnibus bill that came out of committee. The bill HF 3100 has passed the House and is now in Senate committee. The bill appropriates $176 million to TRA as a one-time state aid to the fund. This will help with unfunded liabilities that the fund currently has. The bill also reduces the actuarial assumed rate of return from 7.5% to 7%. One BIG change in the bill affect the St. Paul Teacher’s Retirement Association. This bill DOES include a provision for a “62/30” rule with NO early retirement penalty.

None of these changes help current teachers in any way. We still have to teach until 66 to receive the full pension that current retirees received at age 56. Coming into the session, I was feeling very positive about the possibility of good changes coming to our pension. We had a MASSIVE surplus, a DFL-controlled government, and yet here we are. I wish I had better news to share, but I am only reporting on what has actually happened. There are still about 3 weeks left in the 2023 session, but if a bill hasn’t made it out of committee by this point, its chances are slim to none of passing this session. Next year’s session most likely won’t produce much in change as it’s an even year, and bonding (the money) occurs in odd-year sessions.

Keep contacting your legislators to let them know that fixing Minnesota’s BROKEN teacher pension system is of huge importance in attracting people into the profession. We all are seeing first-hand the massive shortages of available teachers out there. And as always, Keep Stackin!