SD Judge Upholds Cut in Annual Pension Increases

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PIERRE, S.D. (AP) – A South Dakota judge has upheld the state Legislature’s decision to trim annual inflationary increases in benefits for retirees in the state’s public retirement system in recent years.
After the economic downturn in 2008 and 2009 caused the value of assets to fall in the South Dakota Retirement System, the Legislature passed a law pegging annual cost-of-living adjustments to the system’s financial health. The annual increases had been 3.1 percent, but were cut to 2.1 percent in the last two years.
Some retirees filed a lawsuit saying the cut was unconstitutional.
But Circuit Judge Mark Barnett of Pierre ruled Tuesday that the Legislature had constitutional authority to change the cost-of-living adjustments. He says retirees have no contract that guarantees them a 3.1 percent increase every year.

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