Statewide Volunteer Firefighter (SVF) Plan

In 2009, the Minnesota Legislature created the SVF Plan for volunteer firefighters who serve a municipal fire department or an independent nonprofit firefighting corporation. Minnesota Statutes Chapter 353G  governs the SVF Plan. Participation in the SVF Plan is voluntary and open to fire departments as a replacement of their existing volunteer firefighter pension plan. It is also open to departments that do not currently have a pension plan for their volunteer firefighters.

The pension assets and liabilities of each fire department are maintained and accounted for separately from the other fire departments participating in the SVF Plan. The State Board of Investment invests the SVF Plan pension assets for each fire department.

The PERA Board of Trustees and Executive Director administer the SVF Plan. The PERA Board of Trustees receives advice and guidance on SVF Plan administration from the SVF Plan Advisory Board, which consists of Minnesota township, city, fire chief, and volunteer firefighter representatives.

The SVF Plan is a Defined Benefit Plan (DBP), but, unlike other DBPs PERA administers, the retirement benefit is a one-time, lump-sum amount. A volunteer firefighter’s retirement benefit is based on their years of service, vesting status, and the benefit level in effect for their department at the time they separate from service.

Fire state aid, municipal contributions (as applicable), and investment earnings on pension assets fund the SVF Plan. The fire department’s governing body selects a benefit level when it joins the SVF Plan and can elect to increase the department’s benefit level after joining. A fire department’s governing body is the entity sponsoring the fire department: a municipality, nonprofit firefighting corporation, or joint powers entity, as applicable.

Required contributions are due from the governing body only if the combined fire state aid and assumed 6% investment earnings on the fire department’s pension assets do not cover the annual financial requirement (i.e., the annual cost of participating in the SVF Plan). In other words, if fire state aid plus the assumed 6% investment earnings are greater than the annual cost of participating in the SVF Plan, the governing body will not owe a required contribution for the year.

If eligible, the governing body of a fire department in the SVF Plan may elect to transfer out of or terminate their participation in the SVF Plan. Minnesota Statutes 353G.17 and 353G.18 govern the requirements and processes for transferring out of or terminating participation in the SVF Plan.