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Minnesota

Overview

Major public employee retirement systems in Minnesota include the Minnesota State Retirement System (SRS), the Minnesota Teachers Retirement Association (TRA), and the Minnesota Public Employees Retirement Association (PERA).

Minnesota SRS administers pension and other benefits to state employees and employees of universities, cities, counties, and other political subdivisions that have elected to participate. The system consists of six defined benefit plans and two defined contribution plans. 

TRA of Minnesota administers retirement and other benefits to most of the state's public school teachers, administrators, and state college faculty. 

Minnesota PERA administers pension and other benefits to employees of approximately 2,000 cities, counties, school districts and other political subdivisions in the state. The system administers three defined benefit plans, the largest of which (Public Employees Retirement Fund) makes up more than 90% of active membership. Other plans exist for public safety personnel and corrections officers. PERA also manages a defined contribution plan for employees of local ambulance services, physicians at public hospitals, and local elected officials. 

The assets of Minnesota's state and local defined benefit plans are managed by the State Board of Investment (SBI). The SBI consists of the governor, secretary of state, attorney general, and state auditor.

Plan Design

Defined benefit plans serve as the primary retirement benefit for substantially all public employees in Minnesota.

According to the US Government Accountability Office, 93 percent of employees of state and local government in Minnesota participate in Social Security.

Access plan design detail

Authorizing Statutes and Board Structure

MN Stat § 352.03 establishes the State Retirement System Board of Directors, which consists of 11 members. 

MN Stat § 354.06 establishes the Teachers' Retirement Association Board of Trustees, which consists of 8 members.

MN Stat § 353.03 establishes the Public Employees' Retirement System Board of Trustees, which consists of 11 members. 

Details regarding the composition of these and other retirement boards is accessible via the Retirement and Investment Board Characteristics search tool located at the bottom of this page.

Fiduciary Duty/Prudence Standard

MN Stat § 11A.09 pertains to the activities of the State Investment Board:

In the discharge of their respective duties, the members of the state board, director, board staff, and members of the council and any other person charged with the responsibility of investing money pursuant to the standards set forth in sections 11A.01 to 11A.25 shall act in good faith and shall exercise that degree of judgment and care, under circumstances then prevailing, which persons of prudence, discretion, and intelligence exercise in the management of their own affairs, not for speculation, but for investment, considering the probable safety of their capital as well as the probable income to be derived therefrom. In addition, for the investment of pension fund assets, the members and director of the state board and members of the Investment Advisory Council shall act in accordance with chapter 356A.


MN Stat § 356A.04 pertains to Minnesota retirement systems generally:

Subdivision 1. Duty. A fiduciary of a covered pension plan owes a fiduciary duty to:

(1) the active, deferred, and retired members of the plan, who are its beneficiaries;

(2) the taxpayers of the state or political subdivision, who help to finance the plan; and

(3) the state of Minnesota, which established the plan.

Subd. 2. Prudent person standard. A fiduciary identified in section 356A.02 shall act in good faith and shall exercise that degree of judgment and care, under the circumstances then prevailing, that persons of prudence, discretion, and intelligence would exercise in the management of their own affairs, not for speculation, considering the probable safety of the plan capital as well as the probable investment return to be derived from the assets.

Legal Protections of Retirement Benefits

No explicit constitutional protection for public pension benefits, but courts apply promissory estoppel and contract theories to protect reasonable pension expectations. Housing and Redevelopment Authority of Chisholm v. Norman, 696 N.W.2d 329 (Minn. 2005)(public employer's promise in CBA to pay retiree healthcare premiums was enforceable on contract grounds); Law Enforcement Labor Services, Inc. v. County of Mower, 483 N.W.2d 696 (Minn. 1992)(upon retirement in reliance on the county's promise of pension benefits a retiree's right is vested for the life of the retiree and cannot be altered absent the retiree's express consent); Christensen v. Minneapolis Mun. Employees Retirement Bd., 331 N.W.2d 740 (Minn. 1983)(promissory estoppel precludes arbitrary changes to a retirement plan but recognizing that public interest in modifying pension plan needs to be considered). Courts also provide limited protection against contract impairment based on MN CONST Art. 1, §11. (MN CONST., Article 1, §11) Source: Robert Klausner, Esq., State Constitutional Protections for Public Sector Retirement Benefits

See also the following search tools:

Retirement System Account Interest Policies Economic Actuarial Assumptions Retirement and Investment Board Characteristics
Information about interest rates applied to account balances of inactive plan participants Assumed rates of investment return and inflation Composition and characteristics of public retirement and investment oversight boards
Mortality Assumptions Plan Design Features Post-retirement Employment Policies
Public retirement system actuarial assumptions for mortality Numerous elements of retirement plan design Policies governing return-to-work for retirement system annuitants

More Data

Flag of Minnesota (August 2, 1983)

Population (2025) 5,830,405

Minnesota public pension statistics,
per U.S. Census Bureau as of FY 2025

Assets

$103.8 billion

Active Members

358,337

Annuitants

269,537

Benefits Paid

$6.3 billion

Employee Contributions

$1.6 billion

Employer Contributions

$2.1 billion

Systems

Three state systems that together account for 98 percent of assets and 96 percent of public pension plan participants in the state. The Census Bureau also reports 434 local systems.

More Data

Other Resources


Become A Member

Becoming a member of NASRA offers a unique opportunity to join a community committed to the sound, efficient, and innovative stewardship of public retirement systems. Membership connects you with a network of professionals and experts, providing valuable insights into managing public retirement systems with a focus on sustainability and risk-averse strategies.

By joining NASRA, you gain the tools and resources to enhance the management of public retirement systems, ensuring their long-term success and reliability for generations to come.

What's New at NASRA: Government Spending Issue Brief

NASRA’s March 2026 update on government spending makes a basic but important point: public pension benefits are not paid out of a government’s day-to-day operating budget. They are paid from trust funds that employees and employers contribute to during an employee’s working years. Those trusts distribute more than $400 billion each year to retirees and beneficiaries in communities across the country. On a national basis, employer contributions to pension trusts in FY 2023 equaled 5.16 percent of direct general spending by state and local governments, which shows that pension contributions remain a limited share of overall public spending even though the level varies from one state to another. 
The brief also shows that pension costs should be viewed in the context of the changes governments have made over the past 15 years to strengthen plan funding. Following the 2008–09 market decline, nearly every state and many local governments adjusted contributions, benefits, or both to improve pension sustainability. More recent data show that employer contributions increased from FY 2022 to FY 2023, but pension spending as a share of total government spending remained broadly stable. The updated brief provides FY 2023 figures and also projects the aggregate pension spending rate for FY 2024, offering a useful snapshot of both current costs and the longer funding trend.