New Bill Opens Door for Contract First Responders to Join Government Pension Plans

This bill, the First Responders Retirement Parity Act, tackles a specific retirement issue for certain firefighters, EMTs, and paramedics. It allows governmental pension plans – the retirement systems typically covering state and local government employees – to include first responders who work for private agencies under contract with local governments. Crucially, it ensures these pension plans won't lose their special 'governmental plan' status under the Internal Revenue Code (IRC) and the Employee Retirement Income Security Act (ERISA) by doing so.

Bridging the Benefits Divide

Think about the paramedics or firefighters serving your community. Some might be direct employees of the city or county, while others might work for a private company that has a contract to provide those emergency services. Historically, this difference in employment structure could create a gap in retirement benefits. This Act aims to close that gap. By allowing these contracted first responders into governmental pension plans (as specified in SEC. 2), it offers a path to more comparable retirement security, regardless of whether they're directly on the government payroll or working through a contracted agency.

Keeping the Plan Status Intact

The technical but vital part of this bill is protecting the 'governmental plan' designation. These plans have specific rules under tax law (IRC) and retirement regulations (ERISA). Adding non-traditional employees (like contracted first responders) could potentially jeopardize that status. This legislation explicitly prevents that issue, stating that including these specific first responders won't cause the plan to fail the requirements. This removes a potential barrier for governments and agencies wanting to offer these benefits. The changes apply to plan years starting after the bill is enacted.