HF 1602

as introduced - 85th Legislature (2007 - 2008) Posted on 12/15/2009 12:00am

A bill for an act
relating to retirement; providing additional benefits to certain teachers;
appropriating money; proposing coding for new law in Minnesota Statutes,
chapter 354.

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

Section 1.

new text begin [354.551] ADDITIONAL BENEFIT FOR CERTAIN TEACHERS.
new text end

new text begin Subdivision 1. new text end

new text begin Additional benefit entitlement. new text end

new text begin Except as otherwise specified in
this section, eligible retired teachers as defined in subdivision 2 are entitled to receive
the additional benefit amount determined under subdivision 3 unless the applicable
person files a written notification with the executive director of the Teachers Retirement
Association that the additional benefit not be paid.
new text end

new text begin Subd. 2. new text end

new text begin Eligibility. new text end

new text begin An eligible person for purposes of this section is a person who:
new text end

new text begin (1) was a teacher as defined in section 354.05, subdivision 2; and
new text end

new text begin (2) rendered teaching service as defined in section 354.05, subdivision 3, either
during the 1968-1969 school year, but was not covered by the improved money purchase
program savings clause in section 354.55, subdivision 17, or before the 1968-1969 school
year, did not take a refund of member contributions upon the termination of teacher
service, and was eligible to make an election under Minnesota Statutes 1971, section
354.55, subdivision 8.
new text end

new text begin Subd. 3. new text end

new text begin Determination of additional benefit amount. new text end

new text begin (a) By July 1, annually, the
executive director of the Teachers Retirement Association shall determine which retired
teachers satisfy the eligibility requirements under subdivision 2 and are eligible to receive
an additional benefit amount under this section, and the executive director shall determine
each eligible person's additional benefit amount.
new text end

new text begin (b) The increase amount is 25 percent of the difference, if a positive number,
obtained by subtracting the single life annuity amount initially payable upon retirement
under section 354.44, subdivision 6, from a comparable single life annuity amount
computed as of the same date under section 354.44, subdivision 2. If the applicable
appropriation in subdivision 6, paragraph (c), does not permit the full postretirement
adjustment payment amount as determined by the executive director of the Teachers
Retirement Association, the increase amount is that portion of the full increase amount that
bears the same relationship to the full increase amount that the authorized appropriation
bears to the full required appropriation for the full increase amount.
new text end

new text begin (c) The annual additional retirement benefit is payable in a lump sum on July 1
beginning July 1, 2008, for eligible persons who were receiving a retirement annuity on
June 1, 2008, or commencing on July 1 following the initial retirement annuity payment
for persons who were active, deferred, or inactive members on June 1, 2008.
new text end

new text begin (d) The additional retirement benefit amount specified in this section is payable from
the Teacher Retirement Association's participation in the Minnesota combined investment
fund under section 11A.14.
new text end

new text begin Subd. 4. new text end

new text begin Duration of additional benefit. new text end

new text begin The additional benefit amount is payable
for life or for the duration of the selected optional annuity form, whichever applies. The
additional benefit amount shall not be increased or escalated.
new text end

new text begin Subd. 5. new text end

new text begin No payment to estate; no retroactivity. new text end

new text begin (a) Nothing in this section
authorizes the payment of an additional benefit amount under this section to an estate or to
a survivor or beneficiary other than under an optional annuity form.
new text end

new text begin (b) Nothing in this section authorizes the payment of an additional benefit amount
for any period before July 1, 2008.
new text end

new text begin (c) Nothing in this section authorizes the payment of an additional benefit amount to
a person who was or is entitled to have their retirement annuity calculated under section
354.44, subdivision 2.
new text end

new text begin Subd. 6. new text end

new text begin Appropriation. new text end

new text begin (a) Before July 1, 2007, the actuary retained under section
356.214 shall determine the present value of the liabilities created by this section using an
8.5 percent investment earnings assumption and any other relevant actuarial assumptions
applicable to the Teachers Retirement Association, including the cost of the actuarial study.
new text end

new text begin (b) The actuary specified in paragraph (a) shall determine the level dollar annual
appropriation to the Teachers Retirement Association, commencing July 1, 2007,
necessary to amortize the liability determined under paragraph (a) by June 30, 2032.
new text end

new text begin (c) The amount specified in paragraph (b) is appropriated annually on July 1,
from the general fund for the period specified in paragraph (b). This appropriation shall
be deposited in the Teacher Retirement Association's participation in the Minnesota
combined investment fund. The constant annual appropriation under this paragraph must
not exceed $5,000,000. If the necessary appropriation amount computed under paragraph
(b) exceeds the permitted appropriation under this paragraph, then the additional benefit
amounts determined under subdivision 3, paragraph (b), must be prorated as specified in
that paragraph.
new text end

Sec. 2. new text begin EFFECTIVE DATE.
new text end

new text begin Section 1, subdivisions 1 to 5, are effective July 1, 2007. Section 1, subdivision 6, is
effective the day following final enactment.
new text end