The following is an editorial from the Rochester Post-Bulletin.
If you’re a glass-half-full optimist and looking for any reasons for hope in the legislative session that just ended, you can stop now.
Early next year, we’ll have a new governor, many new legislators and perhaps new House and Senate leadership. Voters have an opportunity to wipe the Capitol slate clean in November, and then maybe we can talk about reasons for hope.
But there was at least one good example of bipartisan work at the Capitol last month: The Omnibus Pension and Retirement Bill, which shores up the long-term stability of pension funds for 173,000 public employees, which provide benefits for 511,000 people.
The bill didn’t need to happen this year. The unfunded pension liabilities aren’t yet a four-alarm fire. Legislators and Gov. Mark Dayton could have let pension reform slide and added it to the to-do list for the next cast of characters in St. Paul.
Instead they did something about it.
Unfunded pension liabilities are fiscal icebergs looming for Illinois, New Jersey, Kentucky and many other states. Minnesota’s liabilities are manageable by comparison, but if changes weren’t made, we’d eventually be Illinois.
For whatever reason, work on pension reform at the Capitol proceeded as you would wish all issues to be addressed: major stakeholders came to the table, political posturing was kept to a minimum and there were compromises on key details, producing a “clean” bill not linked to other issues that Dayton could live with.
The new law requires employees, retirees and state government to share the burden of fixing the $16.2 billion problem. It’ll take 30 years to get to zero unfunded liabilities under this plan, and a skeptic would say more course corrections will be needed before that happens.
But it immediately addresses $3.4 billion in liabilities and requires the state to kick in $27 million in 2019 and $114 million in 2020-21. Contributions from public employees, including teachers, will go up, and retirees will see an impact on cost-of-living adjustments and other benefits.
In the end, passage was a cliffhanger, with the Legislature approving it in the waning minutes of the session on May 20. Why? Bargaining chips always are kept in reserve. But pension reform is an achievement that both parties can rightly claim, in a legislative session that produced few results other than a bonding bill.
Pensions and retirement benefits are earned by employees, whether public or private. They’re not charitable contributions — they’re part of an employee’s compensation. It’s important that government honors those commitments, and just as important that employees and beneficiaries accept that financial conditions change and pensions require fine-tuning.
That happened here, and it’s an example of how good legislation can happen when all parties work together to address a problem.
Republished with permission.
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