Tax Aids and Credits

Pension Aids - Insurance Surcharge Aid

Statewide Outcome(s):

Insurance Surcharge Aid supports the following statewide outcome(s).

People in Minnesota are safe.

Context:

For some local governments, pension obligations may account for a significant amount of local expenditures.

Insurance Surcharge Aid was established in 1934 and helps support retirement pensions of local fire fighters.

Funding Source: State General Fund, but the amount paid out through insurance surcharge aid is equal to revenue deposited into the general fund from a two percent surcharge on insurance premiums on fire, lighting, and sprinkler leakage coverage in first class cities.

Strategies:

The program is designed to provide pension aid to firefighters’ relief associations in cities of the first class.  Insurance surcharge aid is paid by the state to firefighters’ relief associations in cities of the first class. Annual distributions are based on the total amount of the two percent surcharge on insurance premiums collected within the city.

Results:

Insurance Surcharge Aid helps increase affordability of fire service.

Performance Measures Notes:

Compares payable year 2010 (previous) to 2012 (current).