ND Senate passes bill on state employee benefits, now heads to the House

Published: Feb. 21, 2023 at 6:07 PM CST
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BISMARCK, N.D. (KFYR) - The North Dakota Senate passed a bill Tuesday that would make big changes to state employees’ benefits.

Pension plan or 401(k)? That’s one of the big questions at the State Capitol this week. For some state workers, the answer is to stick with the pension plan.

“This benefits package, in my opinion, is one of the best recruiting and retention tools that the state has to offer. It’s one of the great talent pieces that we have to bring talented and qualified individuals to serve the citizens of this great state,” said Dana Henry, compliance officer at the state tax department.

That’s why lawmakers proposed Senate Bill 2239 – legislation that would pay for the state’s pension fund – which is currently under water. The bill would allow people to sign up for a 401(k) plan over the next 30 years.

“I believe this bill is an improvement to our current situation because it offers an expanded choice of the defined contribution plan. It continues the defined-benefit plan by appropriately funding it into the future,” said Senator Sean Cleary, R-Bismarck.

Although a majority of lawmakers are on board with the way the plan will be paid for, there are some that are concerned with where the funding will come from.

“When you take, as in this bill, 3.6% times their payroll, we have to think about where are those political subs going to come with those dollars from. It’s going to be property taxes,” said Senator Kristin Roers. R-Fargo.

The Senate passed the bill 34-13. Now, it goes to the House.

Senate Bill 2239 is a different pension bill backed by the governor. Governor Doug Burgum’s plan would eliminate the pension plan and only offer 401(k) plans to new employees. That would cost five and a half billion dollars over the next 20 years, making it the most expensive bill in state history. The House is expected to vote on that legislation Wednesday.

Previous Coverage: Lawmakers mull changes to North Dakota Public Employees Retirement System plan