Updated October 30, 2026. Quick answer: Iowa MFPRSI calls its COLA the annual escalator and adjusts pensions every July 1 under Iowa Code section 411.6. The increase is 1.5% of the monthly pension plus a dollar step of $15 to $35 by years retired. That standing formula applies on July 1, 2027, and the sources read show no board vote or index that changes it.
The standing rule
Iowa Code section 411.6 says: “On each July 1, the monthly pensions authorized in this section payable to members retired prior to that date and to beneficiaries entitled to a monthly pension prior to that date shall be adjusted as provided in this subsection.” It adds: “An amount equal to the sum of one and one-half percent of the monthly pension of each retired member and beneficiary and the applicable incremental amount shall be added to the monthly pension of each retired member and beneficiary.”
The MFPRSI Member Handbook says: “Your eligible benefit will be adjusted on an annual basis in July. The process, called the “annual escalator,” is determined as follows:”
The dollar steps
The handbook lists the steps: “$15-retired fewer than 5 years $20-retired at least 5 years, but fewer than 10 years $25-retired at least 10 years, but fewer than 15 years $30-retired at least 15 years, but fewer than 20 years $35-retired at least 20 years”. The statute gives the top step as: “Thirty-five dollars where the member’s retirement date was at least twenty years prior to the effective date of the increase.” It sets these amounts for members receiving a pension under subsection 2, 4 or 6 and for beneficiaries under subsection 11, and adds: “For beneficiaries receiving a pension under subsection 8 or 9, the applicable incremental amount shall be determined as set forth in paragraph “b”, except that the date of the member’s death shall be substituted for the member’s retirement date.”
Who is left out
The handbook says: “All benefits except for terminated vested benefits are eligible for the annual escalator.” The Iowa Code also says: “A retired member eligible for benefits under subsection 1 of this section is not eligible for the readjustment of pensions provided in this subsection unless the member served twenty-two years and attained the age of fifty-five years prior to the member’s termination of employment.” The July 1, 2026 valuation report adds: “The applicable escalator provisions apply from the member’s actual date of retirement at the end of the DROP participation period. No escalation will occur during the DROP participation period.”
Where 2027 stands
A separate 2027 notice is not published in the sources read: the July 1, 2027 adjustment is the standing formula in Iowa Code section 411.6, and this page updates if the General Assembly changes that section or MFPRSI publishes a 2027 notice. The statute sets the formula, so the sources show no board vote or index for the 2027 adjustment. The MFPRSI annual report also mentions a guaranteed November dividend for some retirees: “to combat the effects of inflation, retirees who began receiving benefits prior to July 1990 receive a guaranteed dividend with their regular November benefit payments.” That sentence sits in the report’s section on a different system, IPERS, so it is not an MFPRSI payment.
A worked example
As a computed illustration (not a source figure), a retired member with a previous monthly pension of $2,000 (invented, for the computation) would receive $30 (computed) a month from the percentage part, plus the dollar step for their years retired.
Common mistakes
- Looking for a yearly vote or an index. The Iowa Code sets a fixed formula of 1.5% plus a dollar step.
- Expecting an increase on terminated vested benefits. The handbook says they are not eligible for the annual escalator.
- Expecting an increase during DROP. The valuation report says no escalation will occur during the DROP participation period.
Related: Iowa MFPRSI retirement decisions, how public pension decisions work, and whether Iowa taxes pensions.
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Answer againSources
- Iowa Legislature, Iowa Code 2026, chapter 411 text (the 411.6 pension adjustment): www.legis.iowa.gov
- MFPRSI, MFPRSI Member Handbook: www.mfprsi.org
- MFPRSI / HUB International, Actuarial Valuation Report July 1, 2026: www.mfprsi.org
- MFPRSI, FY2025 Annual Report (ACFR): www.mfprsi.org
- Related official page (not quoted): IRS Tax Topic 410, Pensions and annuities: www.irs.gov
- Related official page (not quoted): IRS Tax Topic 411, Pensions: the General Rule and the Simplified Method: www.irs.gov
Read from the primary documents linked above on October 30, 2026. General information, not tax advice. Your own facts decide the outcome, and a preparer or the IRS itself is the right place to confirm anything consequential.