Updated October 30, 2026. Quick answer: The City of Kansas City, Missouri Employees’ Retirement System pays its COLA on pension checks dated May 1. The ordinance text read sets the adjustment for Tier 1 at three percent a year, noncompounded. A Tier 2 adjustment is paid only if the fund’s funding ratio is at least 80%, equals the prior 12 months of CPI-U, is capped at 2.5% and starts no sooner than the May 1 after the member’s 62nd birthday. No archived document states what was paid on the latest May 1 or sets a 2027 percentage.
The ordinance
Ordinance No. 230440, amending Section 2-1176, says: “An annual cost-of-living adjustment shall be payable on pension checks to be dated May 1 of the current year and shall remain unchanged until the next effective date of adjustment.” For Tier 1: “The adjustment shall be three percent, each year, noncompounded.” Timing for new retirees: “For retirements occurring on or after January 1, 2021, the adjustment shall apply to all beneficiaries receiving benefits, except no pension of any member or beneficiary retiring after February 1 of any year shall be adjusted until May 1 of the succeeding year.”
Tier 2
The ordinance conditions the Tier 2 adjustment: “The adjustment for a Tier 2 member shall be paid if the funding ratio of the pension fund, as shown by the system’s most recent actuarial report, is equal to or greater than 80%”. The amount: “will be equal to the percentage increase in the prior 12 months of the final national consumer price index for all urban consumers published prior to December 31 in advance of the next year’s adjustment, but shall not exceed 2.5% and shall be noncompounded.” Start: “but no sooner than the May 1 following the Tier 2 member’s 62nd birthday”.
How the plan summaries describe it
The April 30, 2023 annual report says: “Tier 1: A 3% non-compounded cost-of-living adjustment is paid to all System beneficiaries.” The earlier financial statements, in their Tier I plan description, say: “An automatic cost-of-living adjustment of 3 percent, non-compounded, is provided annually.”
What the documents do not say
The archived ordinance PDF carries no passage date, and the codified section was not retrieved. The City’s retirement page returned an error, and the newest annual report archived covers the year ended April 30, 2023, so the current Tier 2 funding ratio and whether a Tier 2 adjustment was paid in 2026 are unknown. The 3% for Tier 1 is the ordinance rate, not a confirmed payment.
Where 2027 stands
No 2027 Kansas City Employees’ Retirement System percentage is published: the ordinance text read sets Tier 1 at three percent, and Tier 2 depends on the funding ratio and the CPI published before December 31.
Common mistakes
- Assuming both tiers get 3%. Tier 2 follows CPI, is capped at 2.5% and requires the 80% funding test.
- Expecting a COLA the first May after retirement. A member retiring after February 1 is not adjusted until the following May 1.
- Applying this to other Kansas City retirement systems. This page covers only the Employees’ Retirement System named in the ordinance and plan summary.
Related: Kansas City employees retirement retirement decisions, how public pension decisions work, and whether Missouri taxes pensions.
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Answer againSources
- City of Kansas City, Missouri (City Clerk), Ordinance No. 230440 (amending Sec. 2-1176): clerk.kcmo.gov
- KCMO Employees’ Retirement System (hosted by Public Plans Data), Employees’ Retirement System Annual Report 2023 (Summary of Plan Provisions, April 30, 2023): publicplansdata.org
- KCMO Employees’ Retirement System (hosted by Public Plans Data), Financial Statements, years ended April 30, 2021 and 2020: publicplansdata.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.