HF 3716

as introduced - 89th Legislature (2015 - 2016) Posted on 03/30/2016 10:54am

A bill for an act
relating to retirement; Minnesota State Retirement System; revising augmentation
interest rates for certain terminated privatized employees; amending Minnesota
Statutes 2014, section 352F.04, subdivisions 1, 2, by adding subdivisions.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

Section 1.

Minnesota Statutes 2014, section 352F.04, subdivision 1, is amended to read:

Subdivision 1.

Enhanced augmentation rates.

deleted text begin (a) deleted text end The deferred annuity of a
terminated hospital employee deleted text begin who attained that status before June 2, 2006, deleted text end is subject to
augmentation under Minnesota Statutes 1994, section 352.72, subdivision 2, except that
the rate of augmentation is 5.5 percent compounded annually until new text begin the earlier of new text end January 1
following the year in which the person attains age 55 new text begin or December 31, 2016 new text end . From deleted text begin that date
to the effective date of retirement deleted text end new text begin January 1 following the year in which the person attains
age 55 to December 31, 2016 new text end , the augmentation rate is 7.5 percent compounded annually.

deleted text begin (b) If a terminated hospital employee attained that status on or after June 2, 2006, the
augmentation rate is four percent compounded annually until January 1, following the
year in which the person attains age 55. From that date to the effective date of retirement,
the augmentation rate is six percent compounded annually.
deleted text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective the day following final enactment.
new text end

Sec. 2.

Minnesota Statutes 2014, section 352F.04, is amended by adding a subdivision
to read:

new text begin Subd. 1a. new text end

new text begin Regular augmentation rates. new text end

new text begin From January 1, 2017, to the effective date
of retirement, the augmentation rate applicable to the deferred annuity of a terminated
hospital employee is the applicable rate as set forth in section 352.72, subdivision 2.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective the day following final enactment.
new text end

Sec. 3.

Minnesota Statutes 2014, section 352F.04, subdivision 2, is amended to read:

Subd. 2.

deleted text begin Exceptions deleted text end new text begin Exception new text end .

The deleted text begin increased deleted text end new text begin enhanced new text end augmentation rates
specified in subdivision 1 do not apply if the terminated new text begin hospital new text end employee deleted text begin :
deleted text end

deleted text begin (1) becomes covered again by a retirement plan enumerated in section 356.30,
subdivision 3; or
deleted text end

deleted text begin (2) deleted text end begins receipt of a retirement annuity new text begin under chapter 352 new text end while employed by the
employer which assumed operations of the medical facility or other public employing unit
or purchased the medical facility or other public employing unit.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective retroactively from July 1, 2015.
new text end

Sec. 4.

Minnesota Statutes 2014, section 352F.04, is amended by adding a subdivision
to read:

new text begin Subd. 3. new text end

new text begin Return to covered employment. new text end

new text begin (a) If a terminated hospital employee
becomes covered by a retirement plan enumerated in section 356.30, subdivision 3, the
employee shall be entitled to whichever of the following annuities produces the highest
monthly payment:
new text end

new text begin (1) a deferred annuity and augmentation to which the employee would have been
entitled under subdivision 1 reduced by the dollar amount of any additional benefit
earned under any enumerated retirement plan after the effective date as defined in section
352F.02, subdivision 3;
new text end

new text begin (2) a combined service annuity calculated under section 356.30; or
new text end

new text begin (3) an annuity calculated under section 352.72 for coverage by more than one
retirement system using the augmentation rates set forth in section 352.72, subdivision 2,
paragraph (a).
new text end

new text begin (b) This subdivision applies to any terminated hospital employee who begins to
receive a retirement annuity under chapter 352 on or after July 1, 2015.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective the day following final enactment.
new text end

Sec. 5. new text begin ANNUITY ADJUSTMENT.
new text end

new text begin Under Minnesota Statutes, section 352F.04, subdivision 3, if any terminated hospital
employee began to receive a retirement annuity under Minnesota Statutes, chapter 352,
as adjusted under Minnesota Statutes, chapter 352F, on or after July 1, 2015, but prior
to the effective date of this section, the terminated hospital employee's annuity must be
recalculated under Minnesota Statutes, section 352F.04, subdivision 3, and, if the monthly
amount as recalculated exceeds the monthly amount being received by the terminated
hospital employee, the Minnesota State Retirement System shall:
new text end

new text begin (1) begin paying the recalculated monthly amount as of the first payment date after
the effective date of this section; and
new text end

new text begin (2) pay the sum of the difference between the amount the terminated hospital
employee received each month since commencement of the annuity and the amount the
terminated hospital employee would have received under Minnesota Statutes, section
352F.04, subdivision 3, for that month. The sum of the difference each month shall be
paid in a lump sum to the terminated hospital employee along with the first payment of
the recalculated amount under clause (1).
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective the day following final enactment.
new text end