2024 Legislative Update

May 17, 2024

The Legislature approved the 2024 Pension and Retirement Policy and Supplemental Budget Bill, House File 5040, and Governor Walz signed the bill on May 15.

The Bill includes the following changes to PERA plans:

Defined Contribution Plan (DCP). Effective August 1, 2024, all individuals newly hired or elected to a position eligible for DCP participation must make a one-time irrevocable election within 30 days of hire. All provisions permitting individuals to make an election more than 30 days after hire or to revoke an election to participate are removed.

Individuals who were hired or took office between February 1, 2024 and July 31, 2024 will have an opportunity to make a one-time irrevocable election during the month of October 2024. More information will be shared with employers and impacted members throughout the summer and early fall.

Correctional Plan Multiplier and Contribution Rates. The Correctional plan multiplier increases from 1.9% to 2.2% for any service credit earned July 1, 2025 or later. Contribution rates also increase July 1, 2025 forward:

>>Members: 6.83%

>>Employers: 10.25%

Coordinated and Correctional Workers’ Compensation Offsets. As of January 1, 2025, Coordinated and Correctional disability benefits will no longer be reduced by workers’ compensation.

Police & Fire Plan Firefighter Definition. The Bill updates the definition of firefighter for the purposes of plan membership to include certain employees that work in fire service that are exposed to the hazards of firefighting.

Statewide Volunteer Firefighter Plan. The Bill modifies the structure of 353G, updates definitions, changes administrative requirements, and establishes a defined contribution plan.

Other Administrative Changes. The Bill updates language to ensure consistency in qualification requirements and compensation across fund executive directors. The Bill also modifies provisions in Minnesota Statutes Chapter 356 relating to amortization, correction of errors, and federal compliance.

We will provide additional communication in our upcoming member and employer newsletters. In addition, we will share specific details to impacted membership groups as we begin implementing these changes.