HF 2559

as introduced - 82nd Legislature (2001 - 2002) Posted on 12/15/2009 12:00am

  1.1                          A bill for an act 
  1.2             relating to retirement; modifying annuity computation 
  1.3             provisions for members of the state troopers plan and 
  1.4             PERA police and fire plan; amending Minnesota Statutes 
  1.5             2000, sections 352B.01, subdivision 11; 353.651, 
  1.6             subdivision 2; and 356.30, subdivision 1. 
  1.7   BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
  1.8      Section 1.  Minnesota Statutes 2000, section 352B.01, 
  1.9   subdivision 11, is amended to read: 
  1.10     Subd. 11.  [AVERAGE MONTHLY SALARY.] "Average monthly 
  1.11  salary" means the average of the highest monthly salaries for 
  1.12  five three years of service as a member.  Average monthly salary 
  1.13  must be based upon all allowable service if this service is less 
  1.14  than five three years.  It does not include any amounts of 
  1.15  severance pay or any reduced salary paid during the period the 
  1.16  person is entitled to workers' compensation benefit payments for 
  1.17  temporary disability.  A member on leave of absence receiving 
  1.18  temporary workers' compensation payments and a reduced salary or 
  1.19  no salary from the employer who is entitled to allowable service 
  1.20  credit for the period of absence may make payment to the fund 
  1.21  for the difference between salary received, if any, and the 
  1.22  salary the member would normally receive if not on leave of 
  1.23  absence during the period.  The member shall pay an amount equal 
  1.24  to the member and employer contribution rate under section 
  1.25  352B.02, subdivisions 1b and 1c, on the differential salary 
  1.26  amount for the period of the leave of absence.  The employing 
  2.1   department, at its option, may pay the employer amount on behalf 
  2.2   of the member.  Payment made under this subdivision must include 
  2.3   interest at the rate of 8.5 percent per year, and must be 
  2.4   completed within one year of the return from the leave of 
  2.5   absence. 
  2.6      Sec. 2.  Minnesota Statutes 2000, section 353.651, 
  2.7   subdivision 2, is amended to read: 
  2.8      Subd. 2.  [AVERAGE SALARY.] In calculating the annuity 
  2.9   under subdivision 3, "average salary" means an amount equivalent 
  2.10  to the average of the highest salary earned as a police officer 
  2.11  or firefighter upon which employee contributions were paid for 
  2.12  any five three successive years of allowable service.  Average 
  2.13  salary must be based upon all allowable service if this service 
  2.14  is less than five three years. 
  2.15     The average salary may not include any reduced salary paid 
  2.16  during a period in which the employee is entitled to benefit 
  2.17  payments from workers' compensation for temporary disability 
  2.18  unless the average salary is higher, including this period. 
  2.19     Sec. 3.  Minnesota Statutes 2000, section 356.30, 
  2.20  subdivision 1, is amended to read: 
  2.21     Subdivision 1.  [ELIGIBILITY; COMPUTATION OF ANNUITY.] (a) 
  2.22  Notwithstanding any provisions of the laws governing the plans 
  2.23  enumerated in subdivision 3, a person who has met the 
  2.24  qualifications of paragraph (b) may elect to receive a 
  2.25  retirement annuity from each plan in which the person has at 
  2.26  least one-half year of allowable service, based on the allowable 
  2.27  service in each plan, subject to the provisions of paragraph (c).
  2.28     (b) A person may receive upon retirement a retirement 
  2.29  annuity from each plan in which the person has at least one-half 
  2.30  year of allowable service, and augmentation of a deferred 
  2.31  annuity calculated under the laws governing each public pension 
  2.32  plan or fund named in subdivision 3, from the date the person 
  2.33  terminated all public service if: 
  2.34     (1) the person has allowable service totaling an amount 
  2.35  that allows the person to receive an annuity in any two or more 
  2.36  of the enumerated plans; and 
  3.1      (2) the person has not begun to receive an annuity from any 
  3.2   enumerated plan or the person has made application for benefits 
  3.3   from each applicable plan and the effective dates of the 
  3.4   retirement annuity with each plan under which the person chooses 
  3.5   to receive an annuity are within a one-year period.  
  3.6      (c) The retirement annuity from each plan must be based 
  3.7   upon the allowable service, accrual rates, and average salary in 
  3.8   the applicable plan as further specified or modified in the 
  3.9   following clauses:  
  3.10     (1) the laws governing annuities must be the law in effect 
  3.11  on the date of termination from the last period of public 
  3.12  service under a covered plan with which the person earned a 
  3.13  minimum of one-half year of allowable service credit during that 
  3.14  employment; 
  3.15     (2) the "average salary" on which the annuity from each 
  3.16  covered plan in which the employee has credit in a formula plan 
  3.17  shall be based on the employee's highest five successive years 
  3.18  of covered salary during the entire service in covered 
  3.19  plans means the highest average of covered salary for the 
  3.20  appropriate period of credited service that is required for the 
  3.21  calculation by the covered retirement plan; 
  3.22     (3) accrual rates to be used by each plan must be those 
  3.23  percentages prescribed by each plan's formula as continued for 
  3.24  the respective years of allowable service from one plan to the 
  3.25  next, recognizing all previous allowable service with the other 
  3.26  covered plans; 
  3.27     (4) allowable service in all the plans must be combined in 
  3.28  determining eligibility for and the application of each plan's 
  3.29  provisions in respect to reduction in the annuity amount for 
  3.30  retirement prior to normal retirement age; and 
  3.31     (5) the annuity amount payable for any allowable service 
  3.32  under a nonformula plan of a covered plan must not be affected 
  3.33  but such service and covered salary must be used in the above 
  3.34  calculation.  
  3.35     (d) This section does not apply to any person whose final 
  3.36  termination from the last public service under a covered plan is 
  4.1   prior to May 1, 1975.  
  4.2      (e) For the purpose of computing annuities under this 
  4.3   section the accrual rates used by any covered plan, except the 
  4.4   public employees police and fire plan, the judges' retirement 
  4.5   fund, and the state patrol retirement plan, must not exceed the 
  4.6   percent specified in section 356.19, subdivision 4, per year of 
  4.7   service for any year of service or fraction thereof.  The 
  4.8   formula percentage used by the judges' retirement fund must not 
  4.9   exceed the percent specified in section 356.19, subdivision 8, 
  4.10  per year of service for any year of service or fraction 
  4.11  thereof.  The accrual rate used by the public employees police 
  4.12  and fire plan and the state patrol retirement plan must not 
  4.13  exceed the percent specified in section 356.19, subdivision 6, 
  4.14  per year of service for any year of service or fraction 
  4.15  thereof.  The accrual rate or rates used by the legislators 
  4.16  retirement plan and the elective state officers retirement plan 
  4.17  must not exceed 2.5 percent, but this limit does not apply to 
  4.18  the adjustment provided under section 3A.02, subdivision 1, 
  4.19  paragraph (c), or 352C.031, paragraph (b). 
  4.20     (f) Any period of time for which a person has credit in 
  4.21  more than one of the covered plans must be used only once for 
  4.22  the purpose of determining total allowable service.  
  4.23     (g) If the period of duplicated service credit is more than 
  4.24  one-half year, or the person has credit for more than one-half 
  4.25  year, with each of the plans, each plan must apply its formula 
  4.26  to a prorated service credit for the period of duplicated 
  4.27  service based on a fraction of the salary on which deductions 
  4.28  were paid to that fund for the period divided by the total 
  4.29  salary on which deductions were paid to all plans for the period.
  4.30     (h) If the period of duplicated service credit is less than 
  4.31  one-half year, or when added to other service credit with that 
  4.32  plan is less than one-half year, the service credit must be 
  4.33  ignored and a refund of contributions made to the person in 
  4.34  accord with that plan's refund provisions. 
  4.35     Sec. 4.  [EFFECTIVE DATE.] 
  4.36     Sections 1 to 3 are effective July 1, 2001.