SM 31 is a memorial requesting that the Legislative Finance Committee create and staff a work group to study the Public Employees Retirement Association (PERA) fund, with a focus on the fund’s solvency, the causes of its growing unfunded liability, and the effect of changes made to retiree cost-of-living adjustments (COLAs). The memorial asks the work group to examine whether current policies are adequately protecting both current retirees and future beneficiaries, and to consider options for restoring COLAs more closely tied to inflation without harming the fund’s long-term stability.
The work group would also be asked to review benefit formulas, contribution levels, retirement incentives, and the role of salary growth, investment performance, and investment oversight in PERA’s financial condition. It would include retirees, PERA leadership, legislative and executive branch analysts, and committee leadership, and would be expected to report recommendations by December 31, 2026. The memorial is advisory rather than a statutory change, but it directs legislative attention toward possible future reforms to PERA benefits and funding policy.
Impact
SM 31 does not directly amend the PERA statute or change benefits on its own; instead, it creates a formal study process that could lead to future legislation affecting retirement benefits, COLA policy, employer and employee contributions, and investment oversight. Its practical impact is to place PERA solvency and retiree inflation protection under legislative review, with an emphasis on balancing actuarial soundness against retiree purchasing power. The memorial could influence future changes to the Public Employees Retirement Act and related budget and pension policy decisions.
Sentiment
The overall sentiment reflected in the bill text and voting history is strongly supportive of examining PERA’s solvency and the impact of COLA reductions. The memorial’s findings are framed around concern for retirees whose pensions have not kept pace with inflation, while also acknowledging the need to preserve the fund for future retirees. The Senate final passage vote was unanimous, indicating broad agreement with the study approach and little visible opposition at the chamber level.
Contention
The main policy tension underlying SM 31 is between restoring retiree COLAs and maintaining or improving PERA’s long-term solvency. Supporters of the memorial argue that the 2020 COLA changes have reduced retirees’ purchasing power without solving the fund’s underlying fiscal problems, and that other factors such as investment underperformance and salary growth deserve greater scrutiny. Potentially contentious issues include whether COLAs should again be tied more closely to inflation, whether changes should apply only to new hires, and how much additional employer or employee contributions might be needed to support any benefit restoration. The bill text suggests concern from retirees about lost purchasing power, while also recognizing actuarial concerns about unfunded liability.