Summary:

 Senate Bill 117 (SB 117) repeals and enacts a new section of 10-11-118 NMSA 1978 related to cost-of-living adjustments for qualified pension recipients participating in the Public Employee Retirement Association (PERA), provides cost-of-living adjustments that are equal to social security and supplemental security income cost-of-living adjustments, and makes an appropriation. 

Legislation Overview:

 Senate Bill 117 (SB 117) repeals Section 10-11-118 NMSA 1978 and a new Section 10-11-118 NMSA 1978 is enacted to state that a qualified pension recipient is eligible for a cost-of-living pension adjustment. A qualified pension recipient is: 

(1) a normal retired member of the Public Employee Retirement Association (PERA) who has been retired for at least two full calendar years from the effective date of the member's latest retirement prior to July 1 of the year in which the pension is being adjusted; 
(2) a normal retired member of PERA who has attained the age of sixty-five years and has been retired for at least one full calendar year from the effective date of the member's latest retirement prior to July 1 of the year in which the pension is being adjusted; 
(3) a disability retired member of PERA who has been retired for at least one full calendar year from the effective date of the member's latest retirement prior to July 1 of the year in which the pension is being adjusted; 
(4) a survivor beneficiary who has received a survivor pension for at least two full calendar years; or 
(5) a survivor beneficiary of a deceased retired PERA member who otherwise would have been retired for at least two full calendar years from the effective date of the member's latest retirement prior to July 1 of the year in which the pension is being adjusted. 

Beginning January 1, 2026, and no later than each January 1 thereafter, the Retirement Board must certify to the PERA the social security and supplemental security income cost-of-living adjustment determined by the Federal Social Security Administration (FSSA) for that calendar year. 

Beginning July 1, 2026, and each July 1 thereafter, the cost-of-living adjustment to a qualified pension recipient payable pursuant to the PERA shall be in an amount equal to the amount certified by the retirement board pursuant to this Act, and the amount of increase shall be determined by multiplying the amount of pension, inclusive of all prior adjustments, by the social security and supplemental security income cost-of-living adjustment determined by the FSSA for that calendar year. 

A qualified pension recipient may decline an increase in a pension by giving the PERA written notice of the decision to decline the increase at least thirty days prior to the date the increase would take effect.

Fifty million dollars ($50,000,000) is appropriated from the General Fund to the PERA for expenditure in Fiscal Year 2026 and subsequent years to provide adequate funding for cost-of-living adjustments to qualified pension recipients. Any unexpended or unencumbered balance remaining at the end of a fiscal year is not to revert to the General Fund. 

The effective date of the provisions of this Act is December 1, 2025.
 

Current Law:

 Exceptions for the payments described are provided in existing law, and the proposed adjustments are not in effect for future years.