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, - fur.d. Therefore, <br />THE AMM OPPOSES MODIFICATION OF THE 'HIGH FIVE' FORMULA. <br />T-2 GENERAL PERA BENEFIT INCREASES AND FUNDING <br />ANY INCREASES IN PERA BENEFITS SHOULD BE GRANTED ONLY TO THE <br />EXTENT THAT PROPOSED CONTRIBUTIONS AND CURRENT RESERVES ARE <br />SUFFICIENT TO FULLY FUND THE INCREASES IN THE OPINION OF ONE OR <br />!?ORE RECOGNIZED PENSION ACTUARIES WHO ARE INDEPENDENT OF THE PERA <br />3RGANIZATION. ANY BENEFIT INCREASE OR CONTRIBUTION REDUCTION <br />PERMITTED BY EXCESS RESERVES OR EXCESSIVE CURRENT CONTRIBUTIONS <br />OR COMBINATIONS OF THE TWO SHOULD BE OF SUCH AMOUNTS AS TO <br />BENEFIT THE EMPLOYER AND EMPLOYEE EQUALLY AS A PERCENTAGE OF <br />OVERALL EMPLOYEE SALARY. <br />T-3 EARLY RETIREMENT <br />Devices to promote early retirement, like the proposed rule of <br />75 for police are a very blunt instrument for cutting budgets or <br />.:Ee : i ng out dead wood. <br />BECAUSE INCREASING LIFE SPANS SHOULD LEAD TO AN INCREASE IN YEARS <br />OF EMPLOYABILITY, THE AMM OPPOSES EXTENSION OF THE RULE OF 85 AND <br />IMPLEMENTATION OF THE RULE OF 75 FOR POLICE OR FIRE FUND MEMBERS <br />AS WELL AS OTHER PROPOSALS TO ENCOURAGE EARLIER RETIREMENT BY <br />PUBLIC EMPLOYEES. <br />7-4 RETIREE HEALTH INSURANCE BY PERA <br />Among all the proposals for benefit increases, the one that most <br />threatens the financial soundness of PERA and other Minnesota <br />public pension funds, is the proposal to provide health insurance <br />to retirees paid from the pension fund. Full payment would <br />commit Lhe taxpayers to an open ended promise to pay a cost that <br />is escalattnk'11.4 1'.,the rate of 15% to 20% per year even in. Ipw,.,. <br />:nfIatio*i' y,falNs. Partial payment would provide .jj , <br />foot -in -the -door for full payment. Eitner would hamper efforts <br />:.o control health care costs by making the recipient responsible <br />for a significantportior; of charges to encourage thrifty use. <br />IN ORDER TO AVOID RECURRING PROBLEMS SIMILAR TO THOSE EXPERIENCED - <br />BY THE FEDERAL GOVERNMENT IN ITS PENSION PROGRAMS, THE AMM, OPPOSE <br />PAYMENT OF HEALTH CARE COSTS FOR RETIREES FROM THE PERA FUND. <br />T-5 RETIREE HEALTH BENEFIT:; BY CITIES <br />In order to prevent the creation of large unfunded deficits for <br />promised health care for retired public employees, in the same <br />way that unfunded actuarial deficits were created by promised <br />pension benefits prior to statutory requirements for funding, the <br />