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Committee votes to recommend a change in the retirement plan for state employees

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An interim Legislative committee has voted to send two bill drafts to the Legislative Management Committee to change the state employee retirement plan to a “defined contribution” plan.

It is currently a “defined benefit” plan.

The change would not affect the employees already on the plan – and would either start with new employees hired after either January First, 2024 or January First, 2025.

The committee was tasked to come up with legislation to move to a defined contribution plan.

Rep. Austen Schauer (R-West Fargo) said in 2013, the unfunded liability for the current retirement program reached $1 billion. He said now, it’s $1.7 billion.

"This is a failure on the part of our team and our state," Schauer said. "And we have to get this figured out."

Schauer said the pension plan has worked out well for those who have worked many years.

"We need to honor that and respect that," Schauer said. "But we have a major issue."

The vote in committee was 9 to 3 to forward both bills to the Legislative Management Committee. House Minority Leader Josh Boschee (D-Fargo) was a "no" vote.

"With us limited in the ability to explore other options, and find ways to fix the current plan, I can't support this," Boschee said. "As Rep. Schauer said, it was our own undoing."

Other opponents of the change say a defined benefit plan is a good way to attract new employees.

If the Legislative Management Committee okays the bill drafts, they will be introduced in the 2023 Legislative session.

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