Require cost-of-living adjustments for retirees for any public power district that operates a defined benefit plan

109th Legislature (2025-2026) Introduced by John Cavanaugh and 1 co-sponsor

Public power districts with defined benefit plans must pay SSA-based annual COLAs to retirees not eligible for Social Security, starting Jan 1, 2026.

Spivey name added

LB 571 — Summary

Overview

LB 571 is a bill introduced in the Nebraska Legislature (One Hundred Ninth Legislature, First Session, 2025) by Senator John Cavanaugh. The bill would require public power districts that operate a defined benefit retirement plan to provide a cost-of-living adjustment (COLA) to certain retirees. The hearing date scheduled is February 28, 2025, with notice issued February 19, 2025. The bill was introduced and referred to the Nebraska Retirement Systems Committee on January 22–24, 2025.

What the bill would do (Key Provisions)

Beginning January 1, 2026, a public power district that operates a defined benefit plan must pay a COLA to retirees under that plan who are not eligible to receive Social Security benefits.

The COLA must be equal to the annual COLA determined by the federal Social Security Administration (SSA).

In short: if a public power district has a defined benefit pension plan and a retiree is not Social Security-eligible, that retiree would receive a COLA equal to SSA’s annual COLA.

Who is affected

Public power districts in Nebraska that operate a defined benefit pension plan.

Retirees under those plans who are not eligible for Social Security benefits.

The change would not automatically apply to districts without a defined benefit plan, nor to retirees who are Social Security-eligible.

Procedural and timeline aspects

Introduced: January 22, 2025.

Referred to the Nebraska Retirement Systems Committee: January 24, 2025.

Hearing notice: February 19, 2025.

Hearing date: February 28, 2025.

Effective date (per the bill): January 1, 2026.

Potential fiscal and policy considerations

The bill would increase retirement costs for affected public power districts, potentially impacting their budgets and possibly rates charged to customers if districts fund the COLA through rate adjustments.

The mandate targets only retirees not eligible for Social Security, which creates a specific eligibility threshold for the COLA.

The SSA COLA component introduces annual variability, as SSA COLA amounts change each year.

Note

The bill is framed as a statutory requirement for certain public power districts and would not apply to districts without a defined benefit plan or to retirees eligible for Social Security under existing rules. Further details and any amendments would likely emerge during committee consideration and floor debate.