HF 1072

as introduced - 87th Legislature (2011 - 2012) Posted on 03/14/2011 10:24am

A bill for an act
relating to public safety; revising employment positions covered by correctional
state employees retirement plan of the Minnesota State Retirement System;
modifying the vesting period for a retirement annuity for the correctional state
employees retirement plan; permitting a service credit transfer to the general
state employees retirement plan by certain correctional employees; amending
Minnesota Statutes 2010, sections 352.72, subdivision 1; 352.90; 352.91,
subdivisions 1, 3h; 352.93, subdivisions 1, 2a, 4, by adding a subdivision;
356.30, subdivision 1; repealing Minnesota Statutes 2010, sections 352.91,
subdivisions 2, 2a, 3c, 3d, 3e, 3f, 3g, 3i, 4a, 4b; 352.925.

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

ARTICLE 1

CORRECTIONAL STATE EMPLOYEES RETIREMENT PLAN I

Section 1.

Minnesota Statutes 2010, section 352.90, is amended to read:

352.90 POLICY.

It is the policy of the legislature to provide special retirement benefits for and special
contributions by certain correctional employees who may be required to retire at an early
age because they lose the mental or physical capacity required to maintain the safety,
security, discipline, and custody of inmates at state correctional facilities deleted text begin or deleted text end new text begin , new text end of patients at
the Minnesota Security Hospital, new text begin or new text end of patients in the Minnesota sex offender program deleted text begin , or
of patients in the Minnesota extended treatment options program deleted text end .

Sec. 2.

Minnesota Statutes 2010, section 352.91, subdivision 1, is amended to read:

Subdivision 1.

Qualifying jobs.

"Covered correctional service" means service
performed by a state employee, as defined in section 352.01, new text begin who is new text end employed at a state
correctional facility, the Minnesota Security Hospital, or the Minnesota sex offender
program as:

(1) a corrections officer 1;

(2) a corrections officer 2;

(3) a corrections officer 3;

deleted text begin (4) a corrections officer supervisor;
deleted text end

deleted text begin (5) deleted text end new text begin (4) new text end a corrections lieutenant;

deleted text begin (6) deleted text end new text begin (5) new text end a corrections captain;

deleted text begin (7) deleted text end new text begin (6) new text end a security counselor;

deleted text begin (8) deleted text end new text begin (7) new text end a security counselor lead; deleted text begin or
deleted text end

deleted text begin (9) deleted text end new text begin (8) new text end a corrections canine officer deleted text begin . deleted text end new text begin ;
new text end

new text begin (9) group supervisor; or
new text end

new text begin (10) group supervisor assistant.
new text end

Sec. 3.

Minnesota Statutes 2010, section 352.91, subdivision 3h, is amended to read:

Subd. 3h.

Employment occupation name changes.

(a) If the occupational title of a
state employee covered by the Minnesota correctional employees retirement plan changes
from the applicable title listed in subdivision 1, deleted text begin 2, 2a, 3c, 3d, 3e, 3f, or 3g, deleted text end qualification for
coverage by the correctional state employees retirement plan continues until the July 1
next following the title change if the commissioner of management and budget certifies
to the executive director of the Minnesota State Retirement System and to the executive
director of the Legislative Commission on Pensions and Retirement that the duties,
requirements, and responsibilities of the new occupational title are substantially identical
to the duties, requirements, and responsibilities of the prior occupational title.

(b) If the commissioner of management and budget does not certify a new
occupational title under paragraph (a), eligibility for future correctional state employees
retirement coverage terminates as of the start of the first payroll period next following the
effective date of the occupational title change.

(c) For consideration by the Legislative Commission on Pensions and Retirement
during the legislative session next following an occupational title change involving a state
employee in covered correctional service, the commissioner of management and budget
shall submit the applicable draft proposed legislation reflecting the occupational title
change covered by this section.

Sec. 4. new text begin REPEALER.
new text end

new text begin Minnesota Statutes 2010, section 352.91, subdivisions 2, 2a, 3c, 3d, 3e, 3f, 3g, 3i,
4a, and 4b, new text end new text begin are repealed.
new text end

Sec. 5. new text begin EFFECTIVE DATE.
new text end

new text begin Sections 1 to 4 are effective July 1, 2011.
new text end

ARTICLE 2

CORRECTIONAL EMPLOYEES RETIREMENT PLAN II

Section 1.

Minnesota Statutes 2010, section 352.72, subdivision 1, is amended to read:

Subdivision 1.

Entitlement to annuity.

(a) new text begin Except as provided in paragraph (b), new text end any
person who has been an employee covered by a retirement system listed in paragraph deleted text begin (b) deleted text end
new text begin (c) new text end is entitled when qualified to an annuity from each fund if total allowable service in all
funds or in any two of these funds totals three or more years if employed before July 1,
2010, or totals five or more years if employed after June 30, 2010.

(b) new text begin If the combination of retirement plans includes the correctional state employees
retirement plan of the Minnesota State Retirement System, no retirement annuity is
payable from the correctional state employees retirement plan unless the person has credit
for at least ten years of covered correctional service under section 352.91, although any
covered correctional service may be used to establish eligibility for an annuity from
another retirement plan, and a service credit transfer under section 352.93, subdivision
4a, may be elected.
new text end

new text begin (c) new text end This section applies to the Minnesota State Retirement System, the Public
Employees Retirement Association including the Public Employees Retirement
Association police and fire fund, the Teachers Retirement Association, the State Patrol
Retirement Association, or any other public employee retirement system in the state with
a similar provision, except as noted in paragraph deleted text begin (c) deleted text end new text begin (d) new text end .

deleted text begin (c) deleted text end new text begin (d) new text end This section does not apply to deleted text begin other deleted text end funds providing benefits for police
officers or firefighters new text begin under chapter 423A, 423B, or 424A new text end .

deleted text begin (d) deleted text end new text begin (e) new text end No portion of the allowable service upon which the retirement annuity from
one fund is based shall be again used in the computation for benefits from another fund.
No refund may have been taken from any one of these funds since service entitling
the employee to coverage under the system or the employee's membership in any of
the associations last terminated. The annuity from each fund must be determined by
the appropriate provisions of the law except that the requirement that a person must
have at least a specific number of years of allowable service in the respective system or
association does not apply for the purposes of this section if the combined service in two
or more of these funds equals at least the longest period of allowable service of any of
the applicable retirement plans.

Sec. 2.

Minnesota Statutes 2010, section 352.93, subdivision 1, is amended to read:

Subdivision 1.

Basis of annuity; when to apply.

After separation from state service,
an employee covered under section 352.91 who has reached age 55 years and deleted text begin is vested
under section 352.925, deleted text end new text begin has credit for at least ten years of covered correctional service new text end is
entitled upon application to a retirement annuity under this section, based only on covered
correctional employees' service. Application may be made no earlier than 60 days before
the date the employee is eligible to retire by reason of both age and service requirements.

Sec. 3.

Minnesota Statutes 2010, section 352.93, subdivision 2a, is amended to read:

Subd. 2a.

Early retirement.

Any covered correctional employee who becomes at
least 50 years old and deleted text begin is vested under section 352.925, deleted text end new text begin has credit for at least ten years of
covered correctional service new text end is entitled upon application to a reduced retirement annuity
equal to the annuity calculated under subdivision 2, reduced by two-tenths of one percent
for each month that the correctional employee is under age 55 at the time of retirement if
first employed as a correctional state employee before July 1, 2010, and if retired before
July 1, 2015, or reduced by 0.417 percent for each month that the correctional employee is
under age 55 at the time of retirement if first employed as a correctional state employee
after June 30, 2010, or if first employed as a correctional state employee before July 1,
2010, and if retired after June 30, 2015.

Sec. 4.

Minnesota Statutes 2010, section 352.93, subdivision 4, is amended to read:

Subd. 4.

Employee with regular and correctional service.

A former employee
who has both regular and correctional service shall, if new text begin the employee has at least ten years
of covered correctional service and is otherwise new text end qualified, receive an annuity based on
both periods of service under applicable sections of law but no period of service shall be
used more than once in calculating the annuity.

Sec. 5.

Minnesota Statutes 2010, section 352.93, is amended by adding a subdivision
to read:

new text begin Subd. 4a. new text end

new text begin Service credit transfer and partial refund in certain instances. new text end

new text begin An
employee covered under section 352.91 who has reached the age of 55 years and who has
credit for less than ten years of covered correctional service may, upon written application,
have that covered correctional service credited as allowable service credit in the general
state employees retirement plan and used to calculate a retirement annuity under sections
352.115 and 352.116, and receive, 30 days following retirement, a refund of that portion
of employee contributions during covered correctional service under section 352.92,
subdivision 1, that exceeds the employee contributions required under the general state
employees retirement plan under section 352.04, subdivision 2, for the same period, plus
annual compound interest on the partial refund amount from the date of each contribution
until the date of refund payment at the rate of six percent.
new text end

Sec. 6.

Minnesota Statutes 2010, section 356.30, subdivision 1, is amended to read:

Subdivision 1.

Eligibility; computation of annuity.

(a) Notwithstanding any
provisions of the laws governing the retirement plans enumerated in subdivision 3, a
person who has met the qualifications of paragraph (b) may elect to receive a retirement
annuity from each enumerated retirement plan new text begin , other than the correctional state employees
retirement plan of the Minnesota State Retirement System, new text end in which the person has at least
one-half year of allowable service, based on the allowable service in each plan, subject to
the provisions of paragraph (c).

(b) A person may receive, upon retirement, a retirement annuity from each
enumerated retirement plan new text begin , other than the correctional state employees retirement plan of
the Minnesota State Retirement System, new text end in which the person has at least one-half year of
allowable service, and augmentation of a deferred annuity calculated at the appropriate
rate under the laws governing each public pension plan or fund named in subdivision 3,
based on the date of the person's initial entry into public employment from the date the
person terminated all public service if:

(1) the person has allowable service in any two or more of the enumerated plans;

(2) the person has sufficient allowable service in total that equals or exceeds the
applicable service credit vesting requirement of the retirement plan with the longest
applicable service credit vesting requirement; and

(3) the person has not begun to receive an annuity from any enumerated plan or the
person has made application for benefits from each applicable plan and the effective
dates of the retirement annuity with each plan under which the person chooses to receive
an annuity are within a one-year period.

(c) The retirement annuity from each plan must be based upon the allowable service,
accrual rates, and average salary in the applicable plan except as further specified or
modified in the following clauses:

(1) the laws governing annuities must be the law in effect on the date of termination
from the last period of public service under a covered retirement plan with which the
person earned a minimum of one-half year of allowable service credit during that
employment;

(2) the "average salary" on which the annuity from each covered plan in which
the employee has credit in a formula plan must be based on the employee's highest five
successive years of covered salary during the entire service in covered plans;

(3) the accrual rates to be used by each plan must be those percentages prescribed by
each plan's formula as continued for the respective years of allowable service from one
plan to the next, recognizing all previous allowable service with the other covered plans;

(4) the allowable service in all the plans must be combined in determining eligibility
for and the application of each plan's provisions in respect to reduction in the annuity
amount for retirement prior to normal retirement age; deleted text begin and
deleted text end

(5) the annuity amount payable for any allowable service under a nonformula plan
of a covered plan must not be affected, but such service and covered salary must be used
in the above calculation deleted text begin . deleted text end new text begin ; and
new text end

new text begin (6) for a person who was a member of the correctional state employees retirement
plan, the person must have at least ten years of covered correctional service under section
352.91 in order to receive a retirement annuity from that plan, but may apply for a service
credit transfer and partial refund under section 352.93, subdivision 4a.
new text end

(d) This section does not apply to any person whose final termination from the last
public service under a covered plan was before May 1, 1975.

(e) For the purpose of computing annuities under this section, the accrual rates
used by any covered plan, except the public employees police and fire plan, the judges
retirement fund, and the State Patrol retirement plan, must not exceed the percent specified
in section 356.315, subdivision 4, per year of service for any year of service or fraction
thereof. The formula percentage used by the judges retirement fund must not exceed the
percentage rate specified in section 356.315, subdivision 8, per year of service for any
year of service or fraction thereof. The accrual rate used by the public employees police
and fire plan and the State Patrol retirement plan must not exceed the percentage rate
specified in section 356.315, subdivision 6, per year of service for any year of service or
fraction thereof. The accrual rate or rates used by the legislators retirement plan must not
exceed 2.5 percent, but this limit does not apply to the adjustment provided under section
3A.02, subdivision 1, paragraph (c).

(f) Any period of time for which a person has credit in more than one of the covered
plans must be used only once for the purpose of determining total allowable service.

(g) If the period of duplicated service credit is more than one-half year, or the person
has credit for more than one-half year, with each of the plans, each plan must apply its
formula to a prorated service credit for the period of duplicated service based on a fraction
of the salary on which deductions were paid to that fund for the period divided by the total
salary on which deductions were paid to all plans for the period.

(h) If the period of duplicated service credit is less than one-half year, or when
added to other service credit with that plan is less than one-half year, the service credit
must be ignored and a refund of contributions made to the person in accord with that
plan's refund provisions.

Sec. 7. new text begin MODIFICATION IN CERTAIN POSTRETIREMENT
EMPLOYER-PAID HEALTH INSURANCE COVERAGE.
new text end

new text begin Notwithstanding any provision to the contrary of any agreement under Minnesota
Statutes, chapter 179A, for any member of the correctional state employees retirement
plan of the Minnesota State Retirement System to be eligible for employer-paid health
insurance coverage after retirement, the person must have at least ten years of covered
correctional service credit under Minnesota Statutes, section 352.91, prior to the
commencement of the retirement annuity under Minnesota Statutes, section 352.93.
new text end

Sec. 8. new text begin REPEALER.
new text end

new text begin Minnesota Statutes 2010, section 352.925, new text end new text begin is repealed.
new text end

Sec. 9. new text begin EFFECTIVE DATE.
new text end

new text begin Sections 1 to 8 are effective July 1, 2011.
new text end