Senator Frentz, a member of the Minnesota Senate Finance Committee, presented the pension omnibus bill, Senate File 2884, to the committee and asked members to move it to the floor. "I'm very proud to bring before you the pension omnibus bill, senate file 2884," he said, calling the package "great things for our educators, for the people that keep us safe, and make changes to the pension system that will provide support, reliability, and a longer term perspective."

The bill would make multiple benefit and appropriation changes across teacher and public-safety retirement plans and includes direct state aid, cost-of-living adjustments (COLAs) and a new pension adjustment revenue stream for school districts. The committee adopted a series of technical and substantive amendments and voted, by voice, to recommend the bill as amended. "All those in favor of the Senator Frentz's motion that Senate File 2884 as amended be recommended pass, say aye," the chair said; the motion prevailed by voice vote.

The most consequential provisions for educators include changes to the Teachers Retirement Association (TRA) career rule: the bill reduces the age used to calculate unreduced retirement from 62 to 60 and lowers the early-retirement penalty percentage from 6% to 5% following that change, according to committee discussion. The bill also removes certain exemptions to an existing COLA delay for teachers, a move sponsors said teachers agreed to as part of the package. Senator Frentz told members that TRA board members agreed to absorb part of the cost from plan sufficiency to enable the benefit changes.

Public-safety provisions include a one-year reduction in the COLA delay and a 3% COLA for calendar year 2026 for police, fire and paramedics; thereafter proponents said COLA would be 1% in 2027. The State Patrol Retirement Fund would receive a across-the-board COLA increase of 1.25% that was estimated to cost about $2.3 million annually. Line-item appropriations presented to the committee included $17,700,000 annually as a direct state transfer to the public employees police and fire retirement plan and, combined with the State Patrol item, about $20,000,000 annually for public-safety plans.

Committee staff described school-related funding mechanics: in addition to employer-paid TRA costs, the bill creates a pension adjustment revenue stream for school districts of $36,800,000 in fiscal 2026-27 and $39,300,000 in 2028-29. Staff explained the 2026 figure is lower because of the timing of school finance payments (90% up-front with a 10% lag carried into the following year).

Appropriations to state agencies that employ TRA members were identified: committee staff reported roughly $569,000 annually for agencies such as the Minnesota Department of Education, Minnesota State Academies, the Perpich Center for Arts Education and Minnesota State Colleges and Universities to cover employer costs for those agencies' TRA membership.

Several senators pressed on funding risks. Committee members and staff discussed that TRA's funding level is about 80.1% (as stated in committee), an improvement over prior years, and that projections now put full funding earlier than prior plans (committee testimony said projections moved from around 2048 to about 2043). Senator Pratt and others raised concern that using plan sufficiency or "absorbing" part of the cost could extend the date to full funding or otherwise increase future risk; Senator Frentz and staff repeatedly described the change as a trade-off between near-term benefit improvements and a modest reduction in the plan's surplus. "You weigh the benefits to the teachers that are teaching our kids against the slightly increased risk to the fund," Frentz said.

Committee members also debated changes to the conditions that trigger state or employer contributions to turn off. In the Legislative Commission on Pensions and Retirement (LCPR) an amendment (A14) was adopted that removed a hard end date (previously 07/01/2048) and tied continued state direct-aid payments to a funding threshold (described in committee as a percentage of actuarial accrued liabilities). Committee staff cautioned they had not fully reconciled all edits before the meeting. A separate conflict in the engrossment concerning a threshold number (110% versus 98%) for an employer supplemental 1% contribution into one of the PERA plans was discussed; committee members and pension system staff agreed to remove the duplicated section and adopt the 98% threshold for the employer supplemental contribution so that cities and counties would not be required to pay the extra employer contribution longer than intended.

PERA Executive Director Doug Anderson and Legislative Commission on Pensions and Retirement Executive Director Susan Launcheski answered committee questions about plan differences and the intent behind the threshold changes. Anderson explained that PERA's police and fire plan is about 90% funded and that the general employees plan (PERA general) is about 89% funded and was projected to be fully funded by 2034; the proposed retiree COLA adjustments would delay that target by roughly two years absent other changes. The committee's compromise reduced a planned employer-contribution cutoff from 100% to 98% to avoid extending the employer supplemental contribution beyond its originally intended timeframe.

Other actions taken in committee included adoption of a technical amendment to direct an appropriation to the "Board of Trustees of the Minnesota State Colleges and Universities" (page 90, line 19 in the engrossment) and adoption of the DE2 amendment package. Committee members asked nonpartisan staff to review a possible conflict in article references and staff and members confirmed they had located duplicate language and removed the duplicate provision in line with the committee discussion. Senator Pappas moved one technical amendment during the meeting; other amendments were moved or accepted by the chair or by voice vote.

The chair closed the meeting after the committee voted to recommend passage of Senate File 2884 as amended. Committee members who spoke expressed differing views about process speed and the desirability of moving benefits now versus prioritizing further funding improvement; proponents emphasized bipartisan support and the immediate benefits to educators and public-safety retirees.

Ending: The committee recommended the bill be passed as amended; the motion carried by voice vote and the meeting adjourned. Final legislative steps, floor consideration, and any further corrections would occur in subsequent floor or reviser actions when the bill proceeds through the legislative process.