Welcome to the latest edition of This Week in Pensions! This is the news you need to know in the fight for a secure retirement. We have gathered the best stories about pensions and retirement security from the previous week.
Before diving into this week’s news, be sure to check out our newest blog by Maria French, which explores the retirement benefits available to public workers nationwide.
This week, NPPC has been closely watching two bills threatening the Montana public pension system. HB 226 applies to the Public Employee Retirement System (PERS), and seeks to default newly hired public employees into a defined contribution plan.. Employees currently have the option of participating in a defined benefit or defined contribution plan, but the default currently is the better defined benefit pension. We have stated time and time again the downfall of defined contribution plans such as 401(k)s. Public employees—who typically make less than those working in the public sector–can build a more secure nest egg to get them through retirement with a defined benefit plan.
HB 569, a harmful bill targeting Montana’s sheriff deputies and highway patrol officers, seeks to raise the retirement eligibility age. In a letter to the editor, Keith Leathers urges legislators to keep their promise to law enforcement. “Highway Patrol troopers and sheriff’s deputies are asked to take on a job that pushes them to their limits physically and mentally. Their work is often dangerous and goes under-appreciated,” said Leathers. Raising the retirement eligibility age to 50, regardless of the years served, will be detrimental to Montana’s ability to hire and retain employees. “There’s a reason this career field has maintained a 20-year retirement for decades. Apparently, our legislature doesn’t understand that,” he continued.
Meanwhile, lawmakers in New Jersey have proposed S3090–known as the “burnout bill,” that would give all police and firefighters the option to retire after 20 years in service. The bill seeks to alleviate public safety workers struggling through the competition of their service due to the taxing mental and physical demands. A 1999 state law that allowed people to retire after 20 years in service changed during Gov. Chis Christie’s administration, requiring employees to be at least 55 years old or 25 years of service to retire early. In 2021, Gov. Phil Murphy signed a temporary law–set to expire in May–allowing nearly 8,000 police officers and firefighters to retire who were in a two-year window of 20 years to retire early, regardless of their age or date hired. This bill, which seeks to be an “indefinite” extension of the current temporary bill–was passed through the state Senate a week ago with a 36-0 vote. The entire state assembly must now approve it before Gov. Murphy can sign it into law.
Be sure to check back next Friday for the latest in the fight for a secure retirement! For now, sign up for NPPC News Clips to receive daily pension news from across the country directly to your inbox.