Cities seek changes to disability pension laws as cops quit in droves

By: - November 29, 2021 7:28 am

A Minneapolis police squad car in front of the burned out Third Precinct police station blocks off Minneahaha Avenue for a street festival in October 2021. Photo by Max Nesterak/Minnesota Reformer.

Calling the current situation “fiscally unsustainable,” Minnesota cities will seek help from the state in covering costs of the skyrocketing number of police officers retiring due to post-traumatic stress and seeking workers’ compensation benefits.

The League of Minnesota Cities plans to push again in the next legislative session for a bill that would fully reimburse cities for the cost of insurance for police officers and firefighters on disability pensions, according to Anne Finn, a lobbyist for the group.

The number of cops and firefighters applying for disability pensions from the state retirement fund has exploded since the police killing of George Floyd in May 2020 that touched off widespread protests, riots and arson.

Since August 2020, about 80% of disability pension applicants say they can’t do their jobs due to post-traumatic stress disorder.

When a worker gets a disability pension, Minnesota law requires cities to continue paying for their health insurance until age 65, with the state reimbursing a portion of the costs.

When the law was enacted in 1997, it contained a provision requiring the state Department of Public Safety to reimburse employers for the full cost of the health insurance. By 2002, the fund was falling short, so the Legislature amended the law to prorate reimbursement to cities based on the amount in the fund and number of applicants.

Since then, the cost has gone up every year for cities, while state funding hasn’t.

Police and firefighter disability applications spiked in the months following the murder of George Floyd and ensuing protests and riots. Graph via the League of Minnesota Cities.

The state Public Employees Retirement Association, known as PERA, received 119 police and fire disability pension applications in 2019, 236 in 2020 and 256 through October of this year.

Of the applications since August 2020, 88% are by cops saying they have PTSD. Of the workers applying in that time, 46% were from Minneapolis, 44% from outside the Twin Cities and 10% from St. Paul.

The PERA retirement plan allows workers to retire early due to disabilities and get at least 60% of their salary tax-free for five years or until they turn 55, when it converts to a regular retirement.

Most of the PTSD applications get approved, too, thanks to a 2019 state law that says if a worker has PTSD, it’s presumed to be work-related.

Then, armed with a disability pension, many employees apply for workers’ compensation benefits. Combined, the two benefits can add up to a full salary.

The health insurance requirement can cost a city hundreds of thousands of dollars if the employee leaves at a relatively young age. Cities must continue to provide whatever level of health insurance the worker had — such as family coverage — until age 65, so if the monthly premium is $1,500, that adds up to $360,000 over 20 years, not counting premium increases.

Finn, the League of Minnesota Cities lobbyist, said the group won’t ask for the repeal of the PTSD presumption but will look at changing the law to require a window where workers can get treatment while on paid leave. The League will seek full state reimbursement to cities to provide paid time and backfill those positions.

“PTSD is something that is more tricky than a straightforward physical injury,” she said.

The league’s board of directors identified disability retirements as one of its five legislative priorities. They adopted a policy last week saying they’re concerned about rising cases not only because of the effect the disability retirements and workers’ comp claims have on employees and employers, but also because the system “can be incompatible with the goal of restoring good health and returning employees to work.”

The league will also push for legislation to fund mental health programs and require public safety college programs to include mental health and PTSD education, with a focus on prevention and coping.

All but nine self-insured Minnesota cities have workers’ compensation coverage through the league.

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Deena Winter
Deena Winter

Deena Winter has covered local and state government in four states over the past three decades, with stints at the Bismarck Tribune in North Dakota, as a correspondent for the Denver Post, city hall reporter in Lincoln, Nebraska, and regional editor for Southwest News in the western Minneapolis suburbs. Before joining the staff of the Reformer in 2021 she was a contributor to the Wall Street Journal and the New York Times. She and her husband have a daughter, son, and very grand child. In her spare time, she likes to play tennis, jog, garden and attempt to check out all the best restaurants in the metro area.

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