SANTA FE, N.M. (AP) – New Mexico’s Democratic Regulator on Monday’s pension fund reforms in a law that affects more than 100,000 state and current and former state government workers.
The legislation increases employee and taxpayer contributions to a public pension fund which has more than $ 6 billion in unfunded liabilities. The legislation requires a cash inflow of $ 55 million this year and annual living cost increases will be linked to pension fund investment returns for the trust overseen by the Public Employees Retirement Association.
During the legislative session the governor acknowledged that the changes would require some sacrifice but allowed vulnerable groups to be protected.
“By paying more than he was doing, PERA was finally on a path to get bankruptcy. Now we have a reverse course, and I am confident that New Mexico can keep its promises to current and future pensioners, ”said Michelle Lujan Grisham.
The governor also described the changes as tools that can be used to recruit and retain the state workforce.
It is also expected that the credit ratings will improve the city and the state, making it cheaper for them to borrow for infrastructure projects.
The main provisions of the bill were set by a policy taskforce appointed by the governor to address pension solvency issues. The Commission considered reforms that could fully fund the pension fund within 25 years.