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contribution was increased to 16.2% and the <br />employee contribution was increased to <br />10.8% beginning January 1, 2015. <br />For the PERA General Plan, an additional <br />one percent employer contribution is <br />required under Minn Stat. § 353.27, subd. <br />3a, which will continue until the actuarial <br />value of the plan assets equal or exceed the <br />liabilities. Employees do not have a similar <br />obligation to help the General Plan reach <br />full funding. When the additional employer <br />contribution was increased to 0.43 percent in <br />1997, the state instituted a PERA aid <br />program for employers to partially offset the <br />cost of increased employer contributions. <br />However, the PERA aid payment rate is <br />frozen at 1999 levels, while the additional <br />employer contribution has since increased <br />from .43% to 1.0%. <br />Response: The League of Minnesota <br />Cities opposes any benefit improvements <br />for retirees or active employees until the <br />financial health of the General Plan and <br />the Police and Fire Plan is restored. <br />For the PERA General Plan, any further <br />increases in employer contributions <br />should only be considered by the <br />Legislature after other measures have <br />been considered, including: <br />a) An increase in employee <br />contributions so that employees and <br />employers truly bear the same <br />responsibility to bring the pension <br />plans to full funding; or <br />b) The removal of the cap on PERA <br />Pension Aid payments so the state <br />equalizes the contributions of <br />employees and employers. <br />The League also supports: <br />a) Modifications to the PERA eligibility <br />guidelines to take into account <br />temporary, seasonal, unique part- <br />time, and student employment <br />situations in cities, particularly in <br />recreational operations. These <br />modifications should include the use <br />of pro -rated service credit, which <br />would make PERA consistent with the <br />other major Minnesota pension plans. <br />b) A comprehensive review of exclusions <br />from pension participation with the <br />goal of simplifying current eligibility <br />guidelines. Such a review should also <br />include a possible revision of current <br />penalties for employers that fail to <br />report covered employees to ensure <br />that these penalties are not overly <br />harsh and punitive. <br />c) The transfer of all school district <br />employees out of the PERA General <br />Plan and into another fund that is <br />more appropriate for school district <br />employees as long as the change would <br />not negatively impact the financial <br />health of the pension funds nor result <br />in employer contribution increases. <br />The continued authority of cities to <br />effectively use retirees in <br />reemployment situations. The League <br />supports policy changes which would <br />include an increase in the earnings <br />threshold for such retirees and <br />supports keeping the required break <br />in service at 30 days and opposes <br />suspending payments to retirees. <br />For PERA Police and Fire, any further <br />increases in employer contributions <br />should only be considered by the <br />Legislature after other measures have <br />been considered, including: <br />a) An initial increase in the employee <br />contribution of at least 1.0% of salary <br />with subsequent increases split evenly <br />between employee and employer so <br />that the contribution ratio moves <br />League of Minnesota Cities <br />2018 City Policies Page 85 <br />