The bill amends Section 10-11-118 of the New Mexico Statutes to increase the cost-of-living adjustment (COLA) for certain retired public employees. It establishes that qualified pension recipients, including normal retired members, disability retired members, and survivor beneficiaries, will receive an annual, non-compounding additional payment of two percent of their annual pension payments for fiscal years 2021, 2022, and 2023. Starting July 1, 2023, the COLA will be determined based on the smoothed investment rate of return and the funded ratio of the pension fund, with specific caps on the adjustments depending on the funded ratio. The bill also introduces new provisions for pension increases for retired members over the age of sixty-five, with different conditions for those who retired from state versus local government employment.

Additionally, the bill appropriates $10 million from the general fund to the public employees retirement association for fiscal year 2026 and subsequent years to support a two percent COLA for normal retired members over the age of sixty-five who retired from state government by June 30, 2025. The bill includes provisions allowing qualified pension recipients to decline the increase in their pension by providing written notice to the association. Overall, the legislation aims to enhance the financial security of retired public employees in New Mexico by ensuring more substantial cost-of-living adjustments.

Statutes affected:
introduced version: 10-11-118