It's all over but the bookkeeping and the lawsuit for the last of the independent Minneapolis pension funds. The board of the Public Employees Retirement Association this morning gave the final approval needed under a 2011 law allowing the city's police and fire funds to merge into PERA. So the merger happens at the end of the year. The retirees, the boards of the funds and the City Council previously all voted for merger. That ends a history of more than a century for each of the funds, all but a handful of whose members have long since retired. Police and firefighters hired in the last 31 years already belong to the public safety pension fund of PERA, which the city funds are joining. There's still some bookkeeping to do to accomplish the merger. There's also the matter of winding up a lawsuit under which the city sued the two funds, charging that they were overcharging the city by inflating what was included in the salary base for calculating pensions. A trial judge ruled that the city was entitled to recover tens of millions of dollars, but an appeals court sent the matter back for another look. There have been settlement discussions. "I think both sides realize it's beneficial to resolve this thing," said Larry Ward, the police fund's president, referring to the lawsuit. This merger was preceded by an administrative consolidation of general city employees into PERA under a 2010 law, and an earlier action allowing Minneapolis teachers to join another statewide fund. Minneapolis retains liability for their unfunded pensions, but the deal brings more predictability to city finances. Police and fire pensions will jump by 43 percent over the next four years under merger terms, to offset lower cost-of-living increases under PERA.
