During the budget negotiations, reforms to public employee pensions was a sticking point. In the end, the legislature adopted changes to the assumed rate of return on pension investments and reduced subsidized early retirement for new employees (hired on or after May 1, 2013).

Current employees may retire early (before age 65), but their pensions are reduced to reflect the fact that they will receive benefits for more years. There are two subsidized early retirement options that reduce benefits by less than under the basic early retirement option.

Under the new reform, if a new employee opts to retire early, he would still get subsidized early retirement; it’s just less rich than the previous subsidized options. Our new brief, A Small Step for Public Pension Reform, looks at the changes in more detail.