Tax Aids and Credits

Pension Aids - Amortization Aids

Statewide Outcome(s):

Amortization Aids 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.

An annual appropriation was established in 1980 to fund amortization aids to police or salaried firefighters’ pension associations that have an unfunded actuarial accrued liability. Certain aid reductions to the Minneapolis association are made annually, depending in part on investment returns. Some amortization aid is also redirected to teachers’ retirement funds.

Funding Source: State General Fund.

Strategies:

Support retirement pensions of local peace officers and fire fighters.

Results:

State assistance helps increase affordability of local government employee pensions.

Performance Measures Notes:

The number of jurisdictions receiving is decreasing as more local pensions are converted to the statewide pension systems or as local pensions become fully funded and no long qualify for aid. Also, some of the amortization aid provisions expired in 2010.

Compares payable year 2009 (previous) to 2011 (current).