I just received my Public Employee's Retirement Association newsletter, and it contained some facts of which I think everyone should be aware.
PERA benefits are entirely funded by employer and employee contributions that are invested in a general fund. Sixty-two percent of PERA general plan members collect pensions of less than $1,000 per month. More than 84 percent collect less than $2,000 per month. Only one-quarter of 1 percent receives more than $100,000. Those high earners were police and fire officials who earned high salaries during their careers and retired more than 20 years ago. During their careers they were not covered by Social Security, so PERA is their only pension.
For general-fund employees (the majority), the employer contributes 4.25 percent of wages to PERA while the employee contributes 3.25 percent. Police and fire contributions are somewhat higher for both sides.
When it is all said and done, employee contributions and investment earnings pay for 81 percent of benefits. Employer contributions cover 19 percent.
The Teacher's Retirement Association works on a similar basis.
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Minnesota's public employee pension system provides a valuable benefit to employees without being a burden to taxpayers.
Barbara Isaacson
Moose Lake
