SENATE BILL

57th legislature - STATE OF NEW MEXICO - second session, 2026

INTRODUCED BY

Michael Padilla

AN ACT

RELATING TO PUBLIC EMPLOYEE RETIREMENT; REPEALING AND REENACTING A SECTION OF THE PUBLIC EMPLOYEES RETIREMENT ACT RELATING TO COST-OF-LIVING ADJUSTMENT PROVISIONS FOR QUALIFIED PENSION RECIPIENTS; PROVIDING COST-OF-LIVING ADJUSTMENTS THAT ARE EQUAL TO SOCIAL SECURITY AND SUPPLEMENTAL SECURITY INCOME COST-OF-LIVING ADJUSTMENTS; MAKING AN APPROPRIATION.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF NEW MEXICO:

     SECTION 1. Section 10-11-118 NMSA 1978 (being Laws 2020, Chapter 11, Section 61) is repealed and a new Section 10-11-118 NMSA 1978 is enacted to read:

     "10-11-118. [NEW MATERIAL] COST-OF-LIVING ADJUSTMENTS--QUALIFIED PENSION RECIPIENT.--

          A. As used in this section, "qualified pension recipient" means:

                (1) a normal retired member 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 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 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 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.

          B. A qualified pension recipient is eligible for a cost-of-living pension adjustment.

          C. Beginning January 1, 2027, and no later than each January 1 thereafter, the retirement board shall certify to the association the social security and supplemental security income cost-of-living adjustment determined by the federal social security administration for that calendar year.

          D. Beginning July 1, 2027, and each July 1 thereafter, the cost-of-living adjustment to a qualified pension recipient payable pursuant to the Public Employees Retirement Act shall be in an amount equal to the amount certified by the retirement board pursuant to Subsection C of this section, 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 federal social security administration for that calendar year.

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

     SECTION 2. APPROPRIATION.--Fifty million dollars ($50,000,000) is appropriated from the general fund to the public employees retirement association for expenditure in fiscal year 2027 and subsequent fiscal years to provide adequate funding for cost-of-living adjustments to qualified pension recipients. Any unexpended balance remaining at the end of a fiscal year shall not revert to the general fund.

     SECTION 3. EFFECTIVE DATE.--The effective date of the provisions of this act is December 1, 2026.