ST. CLOUD, Minn. — A statewide change to police and firefighter pension rules could encourage more municipal employees to retire sooner.
Police and firefighters can retire early at age 50, though the state’s official retirement age is 55. Current law reduces employees’ retirement benefit by 1.2 percent for each year before 55 that they retire.
But the St. Cloud Times reports the Legislature made a change last session that would increase that penalty to 5 percent. The change goes into effect July 1, so employees have to consider whether they want to retire before then or wait until they are 55 to avoid the larger penalty.
Mary Vanek, executive director of Public Employees Retirement Association of Minnesota, said the increase will be phased in over the next five years.
The Legislature made the change because people are living longer and early retirements are putting a growing strain on the retirement fund, she said.
St. Cloud already has prepared for more retirements because of the change. Mayor Dave Kleis said the city doesn’t know the full impact because employees don’t have to disclose their retirement plans that far in advance. But he said he directed his Police Department to ensure that its ranks never fall below 102 officers.
Some of the larger police and fire departments in the Twin Cities could see hundreds of employees affected, Kleis said.
St. Cloud Police Chief Blair Anderson said his department has streamlined its hiring process. But with so many officers expected to retire statewide, he said there will be more suitors for the best candidates.
“A lot of us are going to be chasing the same talent,” Anderson said.