HF 2524

as introduced - 88th Legislature (2013 - 2014) Posted on 02/27/2014 03:26pm

A bill for an act
relating to retirement; Public Employees Retirement Association; revising
salary reporting requirement; clarifying early retirement provision application
to sheriffs; revising postretirement option program requirements and extending
expiration date; amending Minnesota Statutes 2012, sections 353.27, subdivision
4; 353.371, subdivisions 1, 4, by adding a subdivision; Minnesota Statutes 2013
Supplement, section 353.651, subdivision 4; Laws 2009, chapter 169, article 5,
section 2, as amended.

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

Section 1.

Minnesota Statutes 2012, section 353.27, subdivision 4, is amended to read:

Subd. 4.

Employer reporting requirements; contributions; member status.

(a) A representative authorized by the head of each department shall deduct employee
contributions from the salary of each public employee who qualifies for membership in
the general employees retirement plan of the Public Employees Retirement Association
or in the public employees police and fire retirement plan under this chapter or chapter
353D or 353E at the rate under section 353.27, 353.65, 353D.03, or 353E.03, whichever is
applicable, that is in effect on the date the salary is paid. The employer representative must
also remit payment in a manner prescribed by the executive director for the aggregate
amount of the employee contributions and the required employer contributions to be
received by the association within 14 calendar days after each pay date. If the payment is
less than the amount required, the employer must pay the shortage amount to the association
and collect reimbursement of any employee contribution shortage paid on behalf of a
member through subsequent payroll withholdings from the wages of the employee.
Payment of shortages in employee contributions and associated employer contributions, if
applicable, must include interest at the rate specified in section 353.28, subdivision 5, if not
received within 30 days following the date the amount was initially due under this section.

(b) The head of each department or the person's designee shall submit for each
pay period to the association a salary deduction report in the format prescribed by the
executive director. The report must be received by the association within 14 calendar
days after each pay date or the employer may be assessed a fine of $5 per calendar day
until the association receives the required data. Data required as part of salary deduction
reporting must include, but are not limited to:

(1) the legal names and Social Security numbers of employees who are members;

(2) the amount of each employee's salary deduction;

(3) the amount of salary defined in section 353.01, subdivision 10, earned in the pay
period from which each deduction was made new text begin , including a breakdown of the portion of
the salary that represents overtime or compensatory pay that the employee was paid for
additional hours worked beyond the regularly scheduled hours, new text end and the salary amount
earned by a reemployed annuitant under section 353.37, subdivision 1, or 353.371,
subdivision 1, or by a disabled member under section 353.33, subdivision 7 or 7a;

(4) the beginning and ending dates of the payroll period covered and the date of
actual payment; and

(5) adjustments or corrections covering past pay periods as authorized by the
executive director.

(c) Employers must furnish the data required for enrollment for each new or
reinstated employee who qualifies for membership in the general employees retirement
plan of the Public Employees Retirement Association or in the public employees police
and fire retirement plan in the format prescribed by the executive director. The required
enrollment data on new members must be submitted to the association prior to or
concurrent with the submission of the initial employee salary deduction. Also, the
employer shall report to the association all member employment status changes, such as
leaves of absence, terminations, and death, and shall report the effective dates of those
changes, on an ongoing basis for the payroll cycle in which they occur. If an employer
fails to comply with the reporting requirements under this paragraph, the executive
director may assess a fine of $25 for each failure if the association staff has notified the
employer of the noncompliance and attempted to obtain the missing data or form from the
employer for a period of more than three months.

(d) The employer shall furnish data, forms, and reports as may be required by
the executive director for proper administration of the retirement system. Before
implementing new or different computerized reporting requirements, the executive
director shall give appropriate advance notice to governmental subdivisions to allow time
for system modifications.

(e) Notwithstanding paragraph (a), the executive director may provide for less
frequent reporting and payments for small employers.

(f) The executive director may establish reporting procedures and methods as
required to review compliance by employers with the salary and contribution reporting
requirements in this chapter. A review of the payroll records of a participating employer
may be conducted by the association on a periodic basis or as a result of concerns known
to exist within a governmental subdivision. An employer under review must extract
requested data and provide records to the association after receiving reasonable advanced
notice. Failure to provide requested information or materials will result in the employer
being liable to the association for any expenses associated with a field audit, which may
include staff salaries, administrative expenses, and travel expenses.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective January 1, 2015.
new text end

Sec. 2.

Minnesota Statutes 2012, section 353.371, subdivision 1, is amended to read:

Subdivision 1.

Eligibility.

(a) This section applies to a basic or coordinated member
of the general employees retirement plan of the Public Employees Retirement Association
who:

(1) for at least the five years immediately preceding separation under clause (2), was
regularly scheduled to work 1,044 or more hours per year in a position covered by the
general employees retirement plan of the Public Employees Retirement Association;

(2) terminates membership as defined under section 353.01, subdivision 11b;

(3) at the time of termination under clause (2), was at least age 62 and met the age
and service requirements necessary to receive a retirement annuity from the plan and
satisfied requirements for the commencement of the retirement annuity;

(4) agrees to accept a postretirement option position with the same deleted text begin or a different
deleted text end governmental subdivision, working a reduced schedule that is both:

(i) a reduction of at least 25 percent from the employee's number of previously
regularly scheduled work hours; and

(ii) 1,044 hours or less in public; and

(5) is not eligible for participation in the state employee postretirement option
program under section 43A.346.

(b) For purposes of this section, the length of separation requirement and termination
of service requirement prohibiting return to work agreements under section 353.01,
subdivisions 11a and 28, are not applicable.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective July 1, 2014, and applies to
appointments made on or after that date.
new text end

Sec. 3.

Minnesota Statutes 2012, section 353.371, subdivision 4, is amended to read:

Subd. 4.

Duration.

Postretirement option employment may be for an initial period
not to exceed one year. At the end of the initial period, the governing body has sole
discretion to determine if the offer of a postretirement option position will be renewed,
renewed with modifications, or terminated. Postretirement option employment may be
renewed annually, deleted text begin but deleted text end new text begin as follows:
new text end

new text begin (1) if entered into before July 1, 2014, for new text end no more than four renewals deleted text begin may occur. deleted text end new text begin ; and
new text end

new text begin (2) if entered on or after July 1, 2014, for no more than two renewals.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective July 1, 2014.
new text end

Sec. 4.

Minnesota Statutes 2012, section 353.371, is amended by adding a subdivision
to read:

new text begin Subd. 8. new text end

new text begin Program expiration. new text end

new text begin (a) Initial postretirement option employment
agreements must not be entered into after June 30, 2019.
new text end

new text begin (b) This section expires on June 30, 2022.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective July 1, 2014.
new text end

Sec. 5.

Minnesota Statutes 2013 Supplement, section 353.651, subdivision 4, is
amended to read:

Subd. 4.

Early retirement.

(a) A person who becomes a public employees police
and fire retirement plan member after June 30, 2007, or a former member who is reinstated
as a member of the plan after that date, who is at least 50 years of age and is at least
partially vested under section 353.01, subdivision 47, upon the termination of public
deleted text begin service deleted text end new text begin employees police and fire retirement plan membership new text end before July 1, 2014, deleted text begin if the
person is other than a county sheriff or after January 4, 2015, if the person is a county
sheriff deleted text end is entitled upon application to a retirement annuity equal to the normal annuity
calculated under subdivision 3, reduced by two-tenths of one percent for each month that
the member is under age 55 at the time of retirement.

(b) Upon the termination of public deleted text begin service deleted text end new text begin employees police and fire retirement
plan membership new text end before July 1, 2014, deleted text begin if the person is other than a county sheriff or
upon the termination of public service before January 5, 2015, if the person is a county
sheriff, deleted text end any public employees police and fire retirement plan member who first became
a member of the plan before July 1, 2007, and who is not specified in paragraph (a),
upon attaining at least 50 years of age with at least three years of allowable service is
entitled upon application to a retirement annuity equal to the normal annuity calculated
under subdivision 3, reduced by one-tenth of one percent for each month that the member
is under age 55 at the time of retirement.

(c) A person deleted text begin other than a county sheriff deleted text end who is a member of the public employees
police and fire retirement plan on or after July 1, 2014, deleted text begin or a county sheriff who is a
member of the public employees police and fire retirement plan on or after January 5,
2015, deleted text end and who is at least 50 years old and is at least partially vested under section 353.01,
subdivision 47, and whose benefit effective date is after July 1, 2014, deleted text begin if other than a
county sheriff or after January 4, 2015, if a county sheriff deleted text end and on or before July 1, 2019, is
entitled upon application to a retirement annuity equal to the normal annuity calculated
under subdivision 3, reduced for each month the member is under age 55 at the time of
retirement by applying a blended monthly rate that is equivalent to the sum of:

(1) one-sixtieth of the annual rate of five percent, prorated for each month the
person's benefit effective date is after July 1, 2014 deleted text begin , or after December 31, 2014, whichever
applies deleted text end ; and

(2) one-sixtieth of the annual rate provided under paragraph (a) or (b), whichever
applies, for each month the person's benefit effective date is before July 1, 2019.

(d) A person deleted text begin other than a county sheriff deleted text end who is a member of the public employees
police and fire retirement plan on or after July 1, 2014, deleted text begin or a county sheriff who is a member
of the public employees police and fire retirement plan on or after January 5, 2015, deleted text end and
who is at least 50 years old and is at least partially vested under section 353.01, subdivision
47, whose benefit effective date is after July 1, 2019, is entitled, upon application, to a
retirement annuity equal to the normal annuity calculated under subdivision 3, reduced by
five percent annually, prorated for each month that the member is under age 55.

new text begin EFFECTIVE DATE. new text end

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

Sec. 6.

Laws 2009, chapter 169, article 5, section 2, the effective date, as amended by
Laws 2010, chapter 359, article 5, section 27, is amended to read:

EFFECTIVE DATE.

This section is effective the day following final enactment
deleted text begin and expires on June 30, 2014. Individuals must not be appointed to a postretirement
option position after that date 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. 7. new text begin COUNTY SHERIFF TEMPORARY EARLY RETIREMENT
PROVISION.
new text end

new text begin Subdivision 1. new text end

new text begin Application. new text end

new text begin (a) This section applies to a county sheriff who:
new text end

new text begin (1) terminates membership in the public employees police and fire retirement plan
after June 30, 2014, and before February 1, 2015;
new text end

new text begin (2) is at least age 50 but less than age 55 on the date of termination;
new text end

new text begin (3) is at least partially vested under Minnesota Statutes, section 353.01, subdivision
47, and meets all applicable requirements for receipt of an early retirement annuity from
the plan; and
new text end

new text begin (4) has as the benefit effective date the day following termination of public
employees police and fire retirement plan membership.
new text end

new text begin (b) Notwithstanding any provision of Minnesota Statutes, section 353.651,
subdivision 4, to the contrary, the early retirement annuity applicable to an eligible person
under paragraph (a) is the applicable benefit specified in subdivision 2.
new text end

new text begin Subd. 2. new text end

new text begin Early retirement annuity. new text end

new text begin (a) If an eligible person became a public
employees police and fire retirement plan member after June 30, 2007, or was a former
member who was reinstated as a member after that date, the person is entitled, upon
application, to the normal annuity calculated under Minnesota Statutes, section 353.651,
subdivision 3, reduced by two-tenths of one percent for each month that the member
is under age 55 at the time of retirement.
new text end

new text begin (b) If an eligible person became a public employees police and fire retirement plan
member before July 1, 2007, and is covered under paragraph (a), the person is entitled,
upon application, to the normal annuity calculated under Minnesota Statutes, section
353.651, subdivision 3, reduced by one-tenth of one percent for each month that the
member is under age 55 at the time of retirement.
new text end

new text begin (c) If an eligible person is not fully vested, the annuity computed under this section
must be reduced accordingly.
new text end

new text begin Subd. 3. new text end

new text begin Expiration. new text end

new text begin This section expires on January 1, 2016.
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