HF 5039

as introduced - 93rd Legislature (2023 - 2024) Posted on 03/20/2024 11:22am

A bill for an act
relating to retirement; Public Employees Retirement Association, statewide
volunteer firefighter plan; adding a defined contribution plan; reducing the
frequency of determining funding requirements for fire department accounts in
the lump-sum division from annually to biennially; clarifying that firefighters with
previous service in other fire departments may request service credit for vesting
purposes; making other technical and administrative changes; amending Minnesota
Statutes 2022, sections 352.1155, subdivision 3; 353G.01, subdivisions 9, 9a, 11,
by adding subdivisions; 353G.05, as amended; 353G.08, subdivision 2; Minnesota
Statutes 2023 Supplement, sections 353G.01, subdivisions 7b, 8b, 12, 12a, 14a,
15; 353G.02, subdivisions 1, 3, 4; 353G.03, subdivision 3; 353G.07; 353G.08,
subdivision 1; 353G.09, subdivisions 1, 1a; 353G.10; 353G.11, subdivision 2, by
adding a subdivision; 353G.115; 353G.12, subdivision 2, by adding a subdivision;
353G.14; proposing coding for new law in Minnesota Statutes, chapter 353G;
repealing Minnesota Statutes 2022, section 353G.01, subdivision 10; Minnesota
Statutes 2023 Supplement, sections 353G.01, subdivisions 7a, 8a; 353G.02,
subdivision 6; 353G.08, subdivision 3; 353G.11, subdivisions 1, 1a, 3, 4; 353G.112;
353G.121.

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

Section 1.

Minnesota Statutes 2022, section 352.1155, subdivision 3, is amended to read:

Subd. 3.

Service credit prohibition.

Notwithstanding any law to the contrary, a person
eligible under this section may not, based on employment to which the waiver in this section
applies, earn further service credit in a Minnesota public defined benefit plan and is not
eligible to participate in a Minnesota public defined contribution plan, other than a deleted text begin volunteer
fire plan deleted text end new text begin firefighter relief association new text end governed by chapter 424A new text begin or the defined contribution
plan under section 353G.01, subdivision 4b new text end . No employer or employee contribution to any
of these plans may be made on behalf of such a person.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective January 1, 2025.
new text end

Sec. 2.

Minnesota Statutes 2022, section 353G.01, is amended by adding a subdivision to
read:

new text begin Subd. 2a. new text end

new text begin Association. new text end

new text begin "Association" means the Public Employees Retirement Association
established under chapter 353.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective January 1, 2025.
new text end

Sec. 3.

Minnesota Statutes 2022, section 353G.01, is amended by adding a subdivision to
read:

new text begin Subd. 4a. new text end

new text begin Defined contribution fund. new text end

new text begin "Defined contribution fund" means that portion
of the fund consisting of the assets attributable to the defined contribution plan.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective January 1, 2025.
new text end

Sec. 4.

Minnesota Statutes 2022, section 353G.01, is amended by adding a subdivision to
read:

new text begin Subd. 4b. new text end

new text begin Defined contribution plan. new text end

new text begin "Defined contribution plan" means the plan that
is one of the two plans that comprise the statewide volunteer firefighter plan. The defined
contribution plan provides each member with a retirement benefit equal to the member's
individual account balance, to which state aid, contributions, forfeitures, and investment
earnings and losses have been credited.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective January 1, 2025.
new text end

Sec. 5.

Minnesota Statutes 2022, section 353G.01, is amended by adding a subdivision to
read:

new text begin Subd. 4c. new text end

new text begin Defined benefit fund. new text end

new text begin "Defined benefit fund" means that portion of the fund
consisting of the assets attributable to the defined benefit plan.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective January 1, 2025.
new text end

Sec. 6.

Minnesota Statutes 2022, section 353G.01, is amended by adding a subdivision to
read:

new text begin Subd. 4d. new text end

new text begin Defined benefit plan. new text end

new text begin "Defined benefit plan" means the plan that is one of
the two plans that comprise the statewide volunteer firefighter plan. The defined benefit
plan provides each member with a retirement benefit that is either a lump sum or a monthly
pension in an amount determined by using a formula that takes into account years of service,
vesting percentage, and the benefit level for the member's fire department. The defined
benefit plan consists of the lump-sum division and the monthly division.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective January 1, 2025.
new text end

Sec. 7.

Minnesota Statutes 2022, section 353G.01, is amended by adding a subdivision to
read:

new text begin Subd. 5a. new text end

new text begin Fire department account. new text end

new text begin "Fire department account" means the account in
the name of each participating employer to which is credited the assets and, in the case of
a participating employer in the defined benefit plan, the liabilities related to the retirement
benefits for members who are or were providing service to the participating employer.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective January 1, 2025.
new text end

Sec. 8.

Minnesota Statutes 2022, section 353G.01, is amended by adding a subdivision to
read:

new text begin Subd. 5b. new text end

new text begin Firefighting corporation. new text end

new text begin "Firefighting corporation" means an independent
nonprofit firefighting corporation that is organized under the provisions of chapter 317A
and that operates primarily for firefighting purposes.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective January 1, 2025.
new text end

Sec. 9.

Minnesota Statutes 2022, section 353G.01, is amended by adding a subdivision to
read:

new text begin Subd. 5c. new text end

new text begin Forfeiture. new text end

new text begin "Forfeiture" means the portion of an account or pension benefit
that is forfeited when a volunteer firefighter ends service before becoming 100 percent
vested in the account or pension benefit.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective January 1, 2025.
new text end

Sec. 10.

Minnesota Statutes 2022, section 353G.01, is amended by adding a subdivision
to read:

new text begin Subd. 6b. new text end

new text begin Individual account. new text end

new text begin "Individual account" means the account in a fire
department account in the defined contribution plan established for a member under section
353G.082 to which allocations are credited and from which deductions are taken under
section 353G.082.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective January 1, 2025.
new text end

Sec. 11.

Minnesota Statutes 2023 Supplement, section 353G.01, subdivision 7b, is amended
to read:

Subd. 7b.

Lump-sum division.

"Lump-sum division" means the division of the new text begin defined
benefit new text end plan governed by section 353G.11.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective January 1, 2025.
new text end

Sec. 12.

Minnesota Statutes 2023 Supplement, section 353G.01, subdivision 8b, is amended
to read:

Subd. 8b.

Monthly deleted text begin benefit deleted text end division.

"Monthly deleted text begin benefit deleted text end division" means the division of
the new text begin defined benefit new text end plan governed by section 353G.112.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective January 1, 2025.
new text end

Sec. 13.

Minnesota Statutes 2022, section 353G.01, subdivision 9, is amended to read:

Subd. 9.

Municipality.

"Municipality" means deleted text begin a governmental entity specified in section
477B.01, subdivision 10, deleted text end a city or township that has new text begin established a fire department, a city or
township that has new text end entered into a contract with deleted text begin an independent nonprofit deleted text end new text begin a new text end firefighting
corporation, or a city or township that has entered into a contract with a joint powers entity
deleted text begin established deleted text end under section 471.59 new text begin that has established or operates a fire department new text end .

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective January 1, 2025.
new text end

Sec. 14.

Minnesota Statutes 2022, section 353G.01, subdivision 9a, is amended to read:

Subd. 9a.

Relief association.

"Relief association" means a deleted text begin volunteer firefighter deleted text end relief
association deleted text begin established deleted text end new text begin as defined new text end under deleted text begin chapter 424A, including a volunteer firefighter
relief association to which records, assets, and liabilities related to lump-sum or monthly
benefits for active and former firefighters will be transferred from the retirement fund upon
satisfaction of the requirements of deleted text end section deleted text begin 353G.17 deleted text end new text begin 424A.001, subdivision 4 new text end .

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective January 1, 2025.
new text end

Sec. 15.

Minnesota Statutes 2022, section 353G.01, is amended by adding a subdivision
to read:

new text begin Subd. 9b. new text end

new text begin Normal retirement age. new text end

new text begin "Normal retirement age" means age 50.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective January 1, 2025.
new text end

Sec. 16.

Minnesota Statutes 2022, section 353G.01, is amended by adding a subdivision
to read:

new text begin Subd. 9c. new text end

new text begin Participating employer. new text end

new text begin "Participating employer" means the municipality or
firefighting corporation that has joined the retirement plan and is associated with a fire
department with volunteer firefighters who are covered by the retirement plan.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective January 1, 2025.
new text end

Sec. 17.

Minnesota Statutes 2022, section 353G.01, subdivision 11, is amended to read:

Subd. 11.

Retirement fund.

"Retirement fund" means the statewide volunteer firefighter
fund established under section 353G.02, subdivision 3 new text begin , consisting of the defined contribution
fund and the defined benefit fund new text end .

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective January 1, 2025.
new text end

Sec. 18.

Minnesota Statutes 2023 Supplement, section 353G.01, subdivision 12, is amended
to read:

Subd. 12.

Retirement plan.

"Retirement plan" new text begin or "plan" new text end means the deleted text begin retirement deleted text end new text begin statewide
volunteer firefighter new text end plan, deleted text begin either the lump-sum division or the monthly benefit division deleted text end new text begin
consisting of the defined contribution plan and the defined benefit plan new text end , established by this
chapter.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective January 1, 2025.
new text end

Sec. 19.

Minnesota Statutes 2023 Supplement, section 353G.01, subdivision 12a, is
amended to read:

Subd. 12a.

Service credit.

"Service credit" means the period of service rendered by a
volunteer firefighter that is certified under section 353G.07 by the fire chief of the fire
department in which the volunteer firefighter serves. deleted text begin A volunteer firefighter's service credit
equals all periods of service with any fire department covered by the plan.
deleted text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective July 1, 2024.
new text end

Sec. 20.

Minnesota Statutes 2023 Supplement, section 353G.01, subdivision 14a, is
amended to read:

Subd. 14a.

Vesting service credit.

"Vesting service credit" means service credit plus
any earlier period of service rendered as a volunteer firefighter new text begin , as defined in subdivision
15, new text end in new text begin another fire department covered by the plan or in new text end a fire department in the state that
was not covered by the plan at the time the service was rendered. deleted text begin The earlier period of
service must be certified by the fire chief of the fire department covered by the plan in a
manner similar to the requirements of section 353G.07. The volunteer firefighter must
provide documentation in a form acceptable to the executive director regarding the earlier
period of service.
deleted text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective July 1, 2024.
new text end

Sec. 21.

Minnesota Statutes 2023 Supplement, section 353G.01, subdivision 15, is amended
to read:

Subd. 15.

Volunteer firefighter.

"Volunteer firefighter" means a person who is deleted text begin an active deleted text end
new text begin a new text end member of the fire department of a municipality or deleted text begin an independent nonprofit deleted text end new text begin a new text end firefighting
corporation and who, in that capacity, new text begin on either a volunteer or on-call basis, new text end engages in new text begin :
new text end

new text begin (1) new text end fire suppression new text begin or prevention new text end activities deleted text begin , provides deleted text end new text begin ;
new text end

new text begin (2) new text end emergency response services deleted text begin , deleted text end new text begin ;
new text end

new text begin (3) emergency medical response activities; new text end or deleted text begin delivers
deleted text end

new text begin (4) new text end fire education or deleted text begin prevention services on an on-call basis deleted text end new text begin supervises personnel engaged
in any of the foregoing new text end .

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective January 1, 2025.
new text end

Sec. 22.

Minnesota Statutes 2023 Supplement, section 353G.02, subdivision 1, is amended
to read:

Subdivision 1.

new text begin Retirement new text end plan.

The statewide volunteer firefighter plan, consisting of
a deleted text begin lump-sum division deleted text end new text begin defined contribution plan new text end and a deleted text begin monthly benefit division deleted text end new text begin defined benefit
plan new text end , is deleted text begin created deleted text end new text begin established new text end .

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective January 1, 2025.
new text end

Sec. 23.

Minnesota Statutes 2023 Supplement, section 353G.02, subdivision 3, is amended
to read:

Subd. 3.

Retirement fund.

(a) The statewide volunteer firefighter fund deleted text begin , consisting of a
lump-sum account and a monthly benefit account, deleted text end is deleted text begin created deleted text end new text begin established new text end . The new text begin retirement
new text end fund contains the assets attributable to the deleted text begin statewide volunteer firefighter deleted text end new text begin defined contribution
plan and the defined benefit new text end plan.

(b) The State Board of Investment shall invest those portions of the retirement fund not
required for immediate purposes in the deleted text begin statewide lump-sum volunteer firefighter plan in
the deleted text end statewide volunteer firefighter account of the Minnesota supplemental investment fund
under section 11A.17.

(c) The commissioner of management and budget is the ex officio treasurer of the
deleted text begin statewide volunteer firefighter deleted text end new text begin retirement new text end fund. The commissioner of management and
budget's general bond to the state covers all liability for actions taken as the treasurer of the
retirement fund.

(d) The revenues of the plan beyond investment returns are governed by section 353G.08
and must be deposited in the fund. The disbursements of the plan are governed by section
353G.08. The commissioner of management and budget shall transmit a detailed statement
showing all credits to and disbursements from the retirement fund to the executive director
monthly.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective January 1, 2025.
new text end

Sec. 24.

Minnesota Statutes 2023 Supplement, section 353G.02, subdivision 4, is amended
to read:

Subd. 4.

new text begin Periodic new text end audit; new text begin biennial new text end actuarial valuation new text begin ; biennial funding report new text end .

(a)
The legislative auditor shall periodically audit the deleted text begin statewide volunteer firefighter deleted text end new text begin retirement
new text end fund.

(b) new text begin The executive director must retain new text end an new text begin approved actuary under section 356.214 to
perform biennial new text end actuarial deleted text begin valuation deleted text end new text begin valuations new text end of new text begin each fire department account in new text end the
deleted text begin lump-sum deleted text end new text begin monthly new text end division deleted text begin of the statewide volunteer firefighter plan may be performed
periodically as determined to be appropriate or useful by the board. An actuarial valuation
of the monthly benefit division of the statewide volunteer firefighter plan must be performed
as frequently as required by government sector generally accepted accounting standards.
An deleted text end new text begin . The new text end actuarial valuation must deleted text begin be performed by the approved actuary retained under
section 356.214 and must deleted text end conform with section 356.215 and the standards for actuarial
work. deleted text begin An deleted text end new text begin The new text end actuarial valuation must contain sufficient detail for each participating
deleted text begin employing entity deleted text end new text begin employer new text end to ascertain the actuarial condition of its account in the new text begin retirement
new text end fund and the new text begin amount of its required new text end contribution deleted text begin requirement towards its deleted text end new text begin to the new text end account.

new text begin (c) The executive director must perform biennial funding assessments of each fire
department account in the lump-sum division. The assessment must comply with section
353G.08, subdivision 1.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective January 1, 2025.
new text end

Sec. 25.

Minnesota Statutes 2023 Supplement, section 353G.03, subdivision 3, is amended
to read:

Subd. 3.

Composition.

(a) The advisory board consists of ten members.

(b) The advisory board members are:

(1) one representative of Minnesota townships, appointed by the Minnesota Association
of Townships;

(2) two representatives of Minnesota cities, appointed by the League of Minnesota Cities;

(3) one representative of Minnesota fire chiefs, who is a fire chief, appointed by the
Minnesota State Fire Chiefs Association;

(4) two representatives of Minnesota volunteer firefighters deleted text begin , all deleted text end who are active volunteer
firefighters, one of whom is covered by the lump-sum division and one of whom is covered
by the monthly deleted text begin benefit deleted text end division, appointed by the Minnesota State Fire Chiefs Association;

(5) three representatives of Minnesota volunteer firefighters deleted text begin who are deleted text end new text begin , at least one of
whom is new text end covered by the lump-sum division new text begin of the defined benefit plan and at least one of
whom is covered by the defined contribution plan new text end , appointed by the Minnesota State Fire
Departments Association; and

(6) one representative of the Office of the State Auditor, designated by the state auditor.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective January 1, 2027.
new text end

Sec. 26.

Minnesota Statutes 2022, section 353G.05, as amended by Laws 2023, chapter
47, article 10, section 9, is amended to read:

353G.05 PLAN COVERAGE ELECTION.

Subdivision 1.

Entities eligible to request coverage.

deleted text begin (a) deleted text end A relief association deleted text begin or a deleted text end new text begin , new text end
municipality new text begin , new text end or deleted text begin independent nonprofit deleted text end firefighting corporation deleted text begin affiliated with a relief
association deleted text end may elect to have its volunteer firefighters covered by the deleted text begin lump-sum division,
if the volunteer firefighters for whom coverage is being requested are covered by a relief
association that is a lump-sum defined benefit relief association or a defined contribution
relief association governed by chapter deleted text end deleted text begin 424A deleted text end new text begin retirement plan new text end .

deleted text begin (b) A relief association or a municipality or independent nonprofit firefighting corporation
affiliated with a relief association may elect to have its volunteer firefighters covered by
the lump-sum division or the monthly benefit division of the retirement plan, if the volunteer
firefighters for whom coverage is being requested are covered by a relief association that
is a monthly benefit defined benefit relief association governed by chapter deleted text end deleted text begin 424A deleted text end deleted text begin .
deleted text end

deleted text begin (c) A municipality or independent nonprofit firefighting corporation that is not affiliated
with a relief association may elect to have its volunteer firefighters covered by the lump-sum
division of the plan.
deleted text end

Subd. 1a.

Requesting coverage.

(a) An entity that is eligible under subdivision 1 to
make a request for coverage may initiate the process of obtaining coverage by filing a request
with the executive director, as described in this subdivision.

(b) The request for coverage must be in writing and on a form prescribed by the executive
director.

new text begin (c) If the request for coverage is for volunteer firefighters covered by a relief association
retirement plan, the secretary of the relief association, following approval of the request by
the board of trustees of the relief association, and the chief administrative officer of the
entity affiliated with the relief association, following approval of the request by the governing
body of the entity, must jointly make the request. If the relief association is affiliated with
more than one entity, the chief administrative officer of each affiliated entity must execute
the request.
new text end

new text begin (d) If the request for coverage is for volunteer firefighters who are not covered by a
relief association retirement plan, the chief administrative officer of the entity operating the
fire department must make the request.
new text end

new text begin Subd. 1b. new text end

new text begin Selection of plan and division. new text end

new text begin (a) In the request for coverage, the entity must
select coverage by either the defined benefit plan or the defined contribution plan.
new text end

new text begin (b) If the entity selects coverage by the defined benefit plan, the entity must select
coverage by either the lump-sum division or the monthly division, except that the entity
may select coverage by the monthly division only if the relief association with which the
entity is affiliated is a defined benefit relief association, as defined under section 424A.001,
subdivision 1b, that provides a monthly pension.
new text end

new text begin (c) If the entity selects coverage by the defined contribution plan and the relief association
with which the entity is affiliated is a defined benefit relief association, as defined under
section 424A.001, subdivision 1b, the defined benefit relief association must complete a
conversion under section 353G.19 as part of the process of joining the retirement plan.
new text end

new text begin Subd. 1c. new text end

new text begin Selection of vesting schedule. new text end

deleted text begin (c) deleted text end In the request for coverage, the entity must
deleted text begin identify the desired service pension amount and deleted text end select a vesting schedule from the following
options:

(1) incremental vesting beginning with 40 percent vested after completing five years of
deleted text begin active deleted text end service and increasing by four percent upon completion of each additional year of
deleted text begin active deleted text end service, until 100 percent vested upon completion of 20 years of deleted text begin active deleted text end service;

(2) incremental vesting beginning with 40 percent vested after completing five years of
deleted text begin active deleted text end service and increasing by 12 percent upon completion of each additional year of
deleted text begin active deleted text end service, until 100 percent vested upon completion of ten years of deleted text begin active deleted text end service; or

(3) incremental vesting beginning with 40 percent vested after completing ten years of
deleted text begin active deleted text end service and increasing by six percent upon completion of each additional year of
deleted text begin active deleted text end service, until 100 percent vested upon completion of 20 years of deleted text begin active deleted text end service.

The entity must not select a vesting schedule that requires more years of service to become
partially or fully vested than the vesting schedule in effect under the former affiliated relief
association, if any.

deleted text begin (d) If the request for coverage is for volunteer firefighters covered by a monthly benefit
defined benefit relief association, the entity making the request must elect coverage either
by the monthly benefit division or by the lump-sum division.
deleted text end

deleted text begin (e) If the request for coverage is for volunteer firefighters covered by a relief association
that provides both a monthly benefit and a lump-sum benefit, the entity making the request
must elect coverage by the monthly benefit division, the lump-sum division, or by both
divisions.
deleted text end

deleted text begin (f) If the request for coverage is for volunteer firefighters covered by a relief association
with a plan governed by chapter deleted text end deleted text begin 424A deleted text end deleted text begin , the secretary of the relief association, following
approval of the request by the board of the relief association, and the chief administrative
officer of the entity affiliated with the relief association, following approval of the request
by the governing body of the entity, must jointly make the request. If the relief association
is affiliated with more than one entity, the chief administrative officer of each affiliated
entity must execute the request.
deleted text end

deleted text begin (g) If the request for coverage is for volunteer firefighters who are not covered by a
relief association, the chief administrative officer of the entity operating the fire department
must make the request.
deleted text end

new text begin Subd. 1d. new text end

new text begin Selection of benefit level. new text end

new text begin (a) If the request for coverage is for coverage by
the defined benefit plan, the entity making the request must identify the desired benefit
level.
new text end

new text begin (b) If the request for coverage is for the lump-sum division of the defined benefit plan,
the benefit level identified must be no less than $500 per full year of service credit and no
more than the maximum amount permitted under section 424A.02, subdivision 3, per full
year of service credit. Benefit levels between the minimum and maximum must be in $100
increments.
new text end

new text begin (c) If the request for coverage is for the monthly division of the defined benefit plan,
the benefit level is the amount specified in the retirement benefit plan document applicable
to the fire department.
new text end

Subd. 2.

Cost analysis for coverage by the deleted text begin lump sum deleted text end new text begin lump-sum new text end division new text begin of the
defined benefit plan new text end .

(a) Upon receipt of a request for coverage by the deleted text begin lump-sum division deleted text end new text begin
defined benefit plan new text end , the executive director must prepare a cost analysis as described in this
subdivision new text begin and deliver the cost analysis to the board of trustees of the relief association, if
one exists, and the governing body new text end .

(b) The cost analysis under this subdivision must be based on:

(1) the deleted text begin service pension amount deleted text end new text begin benefit level new text end under section 353G.11 closest to the deleted text begin service
pension amount deleted text end new text begin benefit level new text end provided by the relief association if the relief association is a
lump-sum defined benefit plan, an amount that is equal to 95 percent of the most current
average account balance per relief association member if the relief association is a defined
contribution plan, or the lowest deleted text begin service pension amount deleted text end new text begin benefit level new text end under section 353G.11
if there is no relief association, rounded up; and

(2) if different than the amount under clause (1), the deleted text begin service pension amount deleted text end new text begin benefit
level new text end identified in the request under subdivision deleted text begin 1a deleted text end new text begin 1d new text end .

(c) The cost analysis must take into account the vesting option selected in the request
under subdivision deleted text begin 1a deleted text end new text begin 1c new text end .

(d) The cost analysis must be prepared using a mathematical procedure certified as
accurate by an approved actuary retained by the Public Employees Retirement Association.

(e) If the request for coverage was made by a relief association that has filed the
information required under section 424A.014 in a timely fashion, upon request by the
executive director, the state auditor shall provide the most recent data available on the
financial condition of the relief association, the most recent firefighter demographic data
available, and a copy of the current relief association bylaws. If a cost analysis is requested,
but no relief association exists, the chief administrative officer of the entity operating the
fire department shall provide the demographic information on the volunteer firefighters
serving as members of the fire department requested by the executive director.

Subd. 3.

Cost analysis for coverage by the monthly deleted text begin benefit deleted text end division new text begin of the defined
benefit plan new text end .

(a) Upon receipt of a request for coverage by the monthly deleted text begin benefit deleted text end division,
the executive director must prepare a cost analysis as described in this subdivision new text begin and
deliver the cost analysis to the board of trustees of the relief association, if one exists, and
the governing body new text end .

(b) The cost analysis under this subdivision must be prepared by the approved actuary
retained by the Public Employees Retirement Association. The cost analysis must be based
on:

(1) the monthly deleted text begin service pension amount deleted text end new text begin benefit level new text end and other retirement benefit types
and amounts in effect for the relief association as of the date of the request;

(2) if different than the amount under clause (1), the monthly pension amount identified
in the request under subdivision deleted text begin 1a deleted text end new text begin 1d new text end and evaluated in a special actuarial valuation prepared
under sections 356.215 and 356.216; and

(3) the standards for actuarial work and the actuarial assumptions utilized in the most
recent actuarial valuation, except that the applicable investment return actuarial assumption
is six percent.

(c) The cost analysis must take into account the vesting option selected in the request
under subdivision deleted text begin 1a deleted text end new text begin 1c new text end .

(d) The secretary of the relief association making the request must supply the demographic
and financial data necessary for the cost analysis to be prepared.

Subd. 4.

Invested assets review.

deleted text begin If a cost analysis is requested under subdivision 2 or
3, deleted text end The executive director of the State Board of Investment shall review the investment
portfolio of the relief association new text begin retirement plan new text end , if deleted text begin applicable deleted text end new text begin one exists new text end , for compliance
with the applicable provisions of chapter 11A and for appropriateness for retention under
the established investment objectives and investment policies of the State Board of
Investment. If the prospective retirement coverage change is approved under subdivision
5, the State Board of Investment may require that the relief association liquidate any
investment security or other asset which the executive director of the State Board of
Investment has determined to be an ineligible or inappropriate investment for retention by
the State Board of Investment. The security or asset liquidation must occur before the
effective date of the transfer of plan coverage. If requested to do so by the chief administrative
officer of the relief association, the executive director of the State Board of Investment shall
provide advice about the best means to conduct the liquidation.

Subd. 5.

Finalization; coverage transfer.

(a) new text begin The transfer of coverage to the defined
contribution plan is considered approved if, no later than 120 days after the filing of the
request for coverage with new text end the executive director deleted text begin shall deliver the cost analysis requested
under subdivision 2 or 3 to deleted text end new text begin , the transfer is approved by both (1) new text end the board of trustees of the
relief association, if one exists, and new text begin (2) new text end the governing body. new text begin If either the governing body or
the board of trustees of the relief association does not take action to approve the transfer
within 120 days after the filing of the request for coverage, the transfer is not approved.
new text end

(b) The transfer of coverage to the new text begin defined benefit new text end plan is considered approved if, deleted text begin within deleted text end
new text begin no later than new text end 120 days deleted text begin of deleted text end new text begin after new text end receipt of the cost analysis, the transfer is approved by both
(1) the board of trustees of the relief association, if one exists, and (2) the governing body.
If either the governing body or the board of trustees of the relief association does not take
action to approve the transfer within 120 days deleted text begin of deleted text end new text begin after new text end receipt of the cost analysis, the transfer
is not approved.

(c) If the transfer is approved, coverage by the plan is effective on the January 1 next
following the date of approval by the last governing body or, if later, the date of approval
by the board of trustees of the relief association.

Subd. 6.

Joint powers entities.

If transfer of coverage to the plan is being requested for
volunteer firefighters that provide services to a fire department operated as or by a joint
powers entity, whenever an election or approval by or delivery to the governing body of a
municipality is required under this section, all municipalities that executed the joint powers
agreement must execute the election or approval or receive delivery, unless the joint powers
agreement specifies another process be followed in order for the action of a joint powers
entity to be effective.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective January 1, 2025.
new text end

Sec. 27.

Minnesota Statutes 2023 Supplement, section 353G.07, is amended to read:

353G.07 deleted text begin CERTIFICATION OF deleted text end SERVICE CREDIT new text begin FOR PENSION BENEFIT
ACCRUAL OR CONTRIBUTION ALLOCATION new text end .

(a) Annually, by March 31, the fire chief of deleted text begin the deleted text end new text begin a new text end fire department with new text begin volunteer
new text end firefighters who are active members of deleted text begin either deleted text end the deleted text begin lump-sum division or the monthly benefit
division shall deleted text end new text begin retirement plan must new text end certify to the executive director the service credit for
the previous calendar year of each new text begin volunteer new text end firefighter rendering active service with the
fire department.

(b) The fire chief shall provide to each firefighter rendering active service with the fire
department notification of the amount of service credit rendered by the firefighter for the
calendar year. The service credit notification must be provided to the firefighter 60 days
before its certification to the executive director deleted text begin of the Public Employees Retirement
Association deleted text end , along with an deleted text begin indication deleted text end new text begin explanation new text end of the process for the firefighter to
challenge the fire chief's determination of service credit. If the service credit amount is
challenged in a timely fashion, the fire chief shall hold a hearing on the challenge, accept
and consider any additional pertinent information, and make a final determination of service
credit. The final determination of service credit by the fire chief is not reviewable by the
executive director deleted text begin of the Public Employees Retirement Association deleted text end or by the board of
trustees deleted text begin of the Public Employees Retirement Association deleted text end .

(c) The service credit certification is an official public document. If a false service credit
certification is filed or if false information regarding service credits is provided, section
353.19 applies.

(d) The service credit certification must be expressed as a percentage of a full year of
service during which an active firefighter rendered at least the minimum level and quantity
of fire suppression, emergency response, fire prevention, or fire education duties required
by the fire department under the rules and regulations applicable to the fire department. No
more than one year of service credit may be certified for a calendar year.

(e) If a firefighter covered by the new text begin retirement new text end plan leaves active firefighting service to
render active military service that is required to be governed by the federal Uniformed
Services Employment and Reemployment Rights Act, as amended, the person must be
certified as providing a full year of service credit in each year of the military service, up to
the applicable limit of the federal Uniformed Services Employment and Reemployment
Rights Act. If the firefighter does not return from the military service in compliance with
the federal Uniformed Services Employment and Reemployment Rights Act, the service
credits applicable to that military service credit period are forfeited and cancel at the end
of the calendar year in which the federal law time limit occurs.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective January 1, 2025.
new text end

Sec. 28.

new text begin [353G.075] SERVICE CREDIT FOR VESTING.
new text end

new text begin (a) Annually, the executive director must credit each volunteer firefighter with a year
of service credit for vesting for each year of service credited for benefit accrual or
contribution allocation under section 353G.07.
new text end

new text begin (b) A volunteer firefighter is entitled to receive service credit toward vesting in the
retirement plan for any period of service as a volunteer firefighter, as defined under section
353G.01, subdivision 15, rendered as a firefighter in a fire department in the state that was
not covered by the retirement plan at the time the service was rendered if the firefighter
submits a request to the executive director indicating the number of years and months of
service for which credit is requested and provides documentation in a form acceptable to
the executive director regarding the earlier period of service. The firefighter must submit a
copy of the request and documentation to the fire chief of the fire department to which the
firefighter is currently providing service.
new text end

new text begin (c) The executive director must credit a firefighter with all years of service as a member
of the retirement plan for any participating employer for vesting purposes.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective July 1, 2024.
new text end

Sec. 29.

Minnesota Statutes 2023 Supplement, section 353G.08, subdivision 1, is amended
to read:

Subdivision 1.

deleted text begin Annual deleted text end new text begin Biennial new text end funding deleted text begin requirements deleted text end new text begin reports new text end ; lump-sum division.

(a)
deleted text begin Annually, deleted text end The executive director deleted text begin shall deleted text end new text begin must new text end determine the funding requirements deleted text begin of deleted text end new text begin for new text end each
new text begin fire department new text end account in the lump-sum division deleted text begin of the statewide volunteer firefighter plan deleted text end
on or before August 1 new text begin every other year new text end . The funding requirements computed under this
subdivision must be determined using a mathematical procedure developed and certified
as accurate by the approved actuary retained by the deleted text begin Public Employees Retirement deleted text end association
and must be based on present value factors using a six percent investment return rate, without
any decrement assumptions. The deleted text begin funding requirements deleted text end new text begin executive director new text end must deleted text begin be certified deleted text end
new text begin provide written notice of the funding requirements new text end to the entity or entities associated with
the fire department whose active firefighters are covered by the plan.

(b) The overall funding balance of each deleted text begin lump-sum deleted text end new text begin fire department new text end account for the current
calendar year must be determined in the following manner:

(1) The total accrued liability for all active and deferred members of the deleted text begin account deleted text end new text begin fire
department new text end as of December 31 of the current year must be calculated based on the service
credit of active and deferred members as of that date.

(2) The deleted text begin total present deleted text end assets of the new text begin fire department new text end account projected to December 31 of
the current year, including receipts by and disbursements from the account anticipated to
occur on or before December 31, must be calculated. deleted text begin To the extent possible, deleted text end The deleted text begin market deleted text end
new text begin executive director must begin phasing in the use of actuarial new text end value of assets deleted text begin must be utilized deleted text end
in making this calculation new text begin beginning with the funding reports for 2026 new text end .

(3) The amount of the deleted text begin total present deleted text end assets calculated under clause (2) must be subtracted
from the amount of the total accrued liability calculated under clause (1). If the amount of
deleted text begin total present deleted text end new text begin the new text end assets exceeds the amount of the total accrued liability, then the account
is considered to have a surplus over full funding. If the amount of the deleted text begin total present deleted text end assets
is less than the amount of the total accrued liability, then the account is considered to have
a deficit from full funding. If the amount of deleted text begin total present deleted text end assets is equal to the amount of
the total accrued liability, then the deleted text begin special fund deleted text end new text begin account new text end is considered to be fully funded.

(c) The financial requirements of each deleted text begin lump-sum account deleted text end new text begin fire department new text end for the following
calendar year must be determined in the following manner:

(1) The total accrued liability for all active and deferred members of the deleted text begin account deleted text end new text begin fire
department new text end as of December 31 of the calendar year next following the current calendar year
must be calculated based on the service used in the calculation under paragraph (b), clause
(1), increased by one year.

(2) The increase in the total accrued liability of the account for the following calendar
year over the total accrued liability of the account for the current year must be calculated.

(3) The amount of administrative expenses of the account must be calculated by
multiplying the per-person dollar amount of the administrative expenses for the most recent
prior calendar year by the number of active and deferred firefighters reported to deleted text begin PERA deleted text end new text begin the
association new text end on the most recent service credit certification form for deleted text begin each deleted text end new text begin the new text end account.

(4) If the account is fully funded, the financial requirement of the account for the
following calendar year is the total of the amounts calculated under clauses (2) and (3).

(5) If the account has a deficit from full funding, the financial requirement of the account
for the following calendar year is the total of the amounts calculated under clauses (2) and
(3) plus an amount equal to one-tenth of the amount of the deficit from full funding of the
account.

(6) If the account has a surplus over full funding, the financial requirement of the account
for the following calendar year is the financial requirement of the account calculated as
though the account was fully funded under clause (4) and, if the account has also had a
surplus over full funding during the prior two years, additionally reduced by an amount
equal to one-tenth of the amount of the surplus over full funding of the account.

(d) The required contribution of the entity or entities associated with the fire department
whose active firefighters are covered by the lump-sum division is the annual financial
requirements of the deleted text begin lump-sum deleted text end new text begin fire department new text end account deleted text begin of the plan deleted text end under paragraph (c)
reduced by the amount of any fire state aid payable under chapter 477B or police and
firefighter retirement supplemental state aid payable under section 423A.022 that is
reasonably anticipated to be received by the new text begin retirement new text end plan attributable to the entity or
entities during the following calendar year, and an amount of deleted text begin interest deleted text end new text begin investment earnings
new text end on the assets projected to be received during the following calendar year calculated at the
rate of six percent per annum. The required contribution must be allocated between the
entities if more than one entity is involved. A reasonable amount of anticipated fire state
aid is an amount that does not exceed the fire state aid deleted text begin actually deleted text end received in the prior year
multiplied by the factor 1.035.

new text begin (e) The financial requirement for each fire department account in the lump-sum division
for the second year of the biennial valuation period must be in the amount determined in
paragraph (d) increased by six percent, but no more than the excess, if any, of the amount
determined under paragraph (c), clause (1), less the actual market value of assets in the fire
department account as of that date.
new text end

deleted text begin (e) deleted text end new text begin (f) new text end The required contribution calculated in paragraph (d) must be paid to the new text begin retirement
new text end plan on or before December 31 of the year for which it was calculated. If the contribution
is not received by the plan by December 31, it is payable with interest at an annual compound
rate of six percent from the date due until the date payment is received by the plan. If the
entity does not pay the full amount of the required contribution, the executive director shall
collect the unpaid amount under section 353.28, subdivision 6.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective January 1, 2025.
new text end

Sec. 30.

Minnesota Statutes 2022, section 353G.08, subdivision 2, is amended to read:

Subd. 2.

Cash flow funding requirement.

If the executive director determines that a
new text begin fire department account in the new text end lump-sum deleted text begin retirement deleted text end new text begin division new text end or deleted text begin a deleted text end new text begin the new text end monthly deleted text begin benefit
retirement account in the statewide volunteer firefighter plan deleted text end new text begin division new text end has insufficient assets
to meet the service pensions expected to be payable from the account over the succeeding
two years, the executive director shall certify the amount of the potential service pension
shortfall to the deleted text begin municipality or municipalities and the municipality or municipalities shall deleted text end
new text begin participating employer, which must new text end make an additional employer contribution to the account
within ten days of the certification. If more than one deleted text begin municipality deleted text end new text begin participating employer
new text end is associated with the account, unless the deleted text begin municipalities deleted text end new text begin participating employers new text end agree to
and implement a different allocation, the deleted text begin municipalities shall deleted text end new text begin participating employers must
new text end allocate the additional employer contribution one-half in proportion to the population of
each deleted text begin municipality deleted text end new text begin participating employer new text end and one-half in proportion to the estimated market
value of the property of each deleted text begin municipality deleted text end new text begin participating employer new text end .

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective January 1, 2025.
new text end

Sec. 31.

new text begin [353G.082] FUNDING OF FIRE DEPARTMENT ACCOUNTS AND
ANNUAL ALLOCATION TO INDIVIDUAL ACCOUNTS IN THE DEFINED
CONTRIBUTION PLAN.
new text end

new text begin Subdivision 1. new text end

new text begin Fire department accounts and individual accounts established. new text end

new text begin (a)
The executive director must establish a fire department account for each participating
employer in the defined contribution plan that consists of individual accounts for the
volunteer firefighters providing firefighting services to the participating employer.
new text end

new text begin (b) The executive director must establish an individual account within each fire
department account for each volunteer firefighter covered by the defined contribution plan,
to which the executive director must credit an allocation of state aid, contributions, forfeitures,
and investment earnings and from which the executive director must deduct investment
losses and administrative expenses.
new text end

new text begin Subd. 2. new text end

new text begin State aid and contributions by the participating employer. new text end

new text begin Notwithstanding
any law to the contrary, the executive director must deposit in each fire department account
in the defined contribution plan for allocation to individual accounts under subdivision 3:
new text end

new text begin (1) any fire state aid payable under chapter 477B or police and firefighter retirement
supplemental state aid payable under section 423A.022 on behalf of the participating
employer with which the fire department is associated; and
new text end

new text begin (2) any contributions from the participating employer with which the fire department is
associated.
new text end

new text begin Subd. 3. new text end

new text begin Annual allocation and deduction in equal shares. new text end

new text begin (a) As of the end of each
calendar year, the executive director must credit to the individual account of each firefighter
providing services to a fire department and who did not leave firefighting service with the
fire department during the calendar year an equal share of:
new text end

new text begin (1) any fire state aid payable under chapter 477B and police and firefighter retirement
supplemental state aid payable under section 423A.022 received by the retirement fund that
is attributable to the participating employer associated with the fire department as soon as
practicable after the aid is received by the retirement fund;
new text end

new text begin (2) any contributions made by the participating employer to the retirement fund for the
benefit of the volunteer firefighters providing firefighting services to the participating
employer as soon as practicable after the contribution is received by the retirement fund;
and
new text end

new text begin (3) any forfeiture under section 353G.10, subdivision 4, attributable to a former volunteer
firefighter of the fire department.
new text end

new text begin (b) As of the end of each calendar year, the executive director must deduct an equal
share of administrative expenses from each individual account.
new text end

new text begin (c) As of the end of the calendar year, the executive director must allocate to the
individual account of a volunteer firefighter who has less than a full year of service a
fractional share of the amount that would have been allocated to the individual account for
a full year of service. The fractional amount is equal to the number of months of service
divided by twelve. A month will be credited if the volunteer firefighter was credited with
at least 16 days of service.
new text end

new text begin Subd. 4. new text end

new text begin Investment earnings and losses. new text end

new text begin The executive director must:
new text end

new text begin (1) credit investment earnings on the assets of each fire department account to each
individual account in proportion to the share of the assets of the fire department account
credited to the individual account; and
new text end

new text begin (2) deduct investment losses on the assets of each fire department account from each
individual account in proportion to the share of the assets of the fire department account
credited to the individual account.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective January 1, 2025.
new text end

Sec. 32.

new text begin [353G.085] AUTHORIZED DISBURSEMENTS.
new text end

new text begin The assets of the retirement fund may be disbursed only as a distribution of lump-sum
retirement benefits, monthly retirement benefits, or individual accounts or for:
new text end

new text begin (1) administrative expenses of the retirement plan;
new text end

new text begin (2) investment expenses of the retirement fund;
new text end

new text begin (3) survivor benefits; and
new text end

new text begin (4) a transfer of assets under section 353G.17.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective January 1, 2025.
new text end

Sec. 33.

Minnesota Statutes 2023 Supplement, section 353G.09, subdivision 1, is amended
to read:

Subdivision 1.

Entitlement.

(a) A member deleted text begin with at least one year of service credit with
a fire department with active firefighters that are covered by the plan deleted text end is entitled to a retirement
benefit as defined in subdivision 1a from the fire department's account in the plan if the
member:

(1) has separated from deleted text begin active deleted text end service with the fire department for at least 30 days;

(2) has attained the new text begin normal retirement new text end age deleted text begin of at least 50 years deleted text end ;

(3) has satisfied the minimum service requirement in paragraph (b) or (c), as applicable;
and

(4) applies in a manner prescribed by the executive director.

(b) If the member is a member of the lump-sum division new text begin or the defined contribution
plan new text end , the member satisfies the minimum service requirement if the member is at least 40
percent vested as determined under subdivision 2.

(c) If the member is a member of the monthly deleted text begin benefit deleted text end division, the member satisfies the
minimum service requirement if the member has completed at least the minimum number
of years of service specified in the retirement benefit plan document applicable to the
member.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective January 1, 2025.
new text end

Sec. 34.

Minnesota Statutes 2023 Supplement, section 353G.09, subdivision 1a, is amended
to read:

Subd. 1a.

Retirement benefit.

(a) A volunteer firefighter who is entitled to a deleted text begin service
pension deleted text end new text begin retirement benefit new text end under subdivision 1 must receive a retirement benefit under
deleted text begin subdivision 1, deleted text end paragraph deleted text begin (a) or deleted text end (b), new text begin (c), or (d), new text end as applicable.

(b) The retirement benefit of a member of the lump-sum division is equal to the number
of years of service credit certified under section 353G.07 for the member, multiplied by the
deleted text begin service pension deleted text end new text begin benefit new text end level applicable to the member under section 353G.11, multiplied
by the member's vested percentage under subdivision 2.

(c) The retirement benefit of a member of the monthly deleted text begin benefit deleted text end division is equal to the
number of years of service credit certified under section 353G.07 for the member, multiplied
by the deleted text begin service pension deleted text end new text begin benefit new text end level applicable to the member under section 353G.112,
multiplied by the member's vested percentage under subdivision 2.

new text begin (d) The retirement benefit of a member of the defined contribution plan is equal to the
balance in the member's account in the plan as of the end of the month after the month in
which the executive director receives the application for a distribution of the retirement
benefit multiplied by the member's vested percentage under subdivision 2.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective January 1, 2025.
new text end

Sec. 35.

Minnesota Statutes 2023 Supplement, section 353G.10, is amended to read:

353G.10 deleted text begin DEFERRED deleted text end new text begin LEAVING FIREFIGHTING new text end SERVICE deleted text begin PENSION AMOUNT deleted text end new text begin
BEFORE REACHING NORMAL RETIREMENT AGE new text end .

new text begin Subdivision 1. new text end

new text begin Entitlement to a retirement benefit, to the extent vested. new text end

deleted text begin A person
who was an active member of a fire department covered by either the lump-sum division
or the monthly benefit division of the plan who has separated deleted text end new text begin If a volunteer firefighter
separates new text end from active firefighting service deleted text begin for at least deleted text end new text begin before reaching normal retirement age,
the volunteer firefighter is entitled to a distribution of the volunteer firefighter's retirement
benefit under section 353G.09, subdivision 1a, as follows:
new text end

new text begin (1) if the volunteer firefighter is covered by the defined contribution plan, the volunteer
firefighter is entitled to a distribution of the retirement benefit as soon as practicable after
the volunteer firefighter submits an application for a distribution;
new text end

new text begin (2) if the volunteer firefighter is covered by the lump-sum division of the defined benefit
plan, the volunteer firefighter is entitled to a distribution of the volunteer firefighter's
retirement benefit after the volunteer firefighter has reached age 50 and as soon as practicable
after the volunteer firefighter submits an application for a distribution; and
new text end

new text begin (3) if the volunteer firefighter is covered by the monthly benefit division of the defined
benefit plan, the volunteer firefighter is entitled to begin a distribution of the volunteer
firefighter's retirement benefit after the volunteer firefighter has reached age 50 and as soon
as practicable after the volunteer firefighter submits an application for a distribution.
new text end

new text begin Subd. 2. new text end

new text begin Application. new text end

new text begin No earlier than new text end 30 days deleted text begin and who has completed at least five years
of service credit, but has not attained the age of 50 years, is entitled to a deferred service
pension on or after attaining the age of 50 years and applying deleted text end new text begin after leaving active firefighting
service, a volunteer firefighter entitled to a distribution under subdivision 1 must submit an
application to the executive director new text end in a manner specified by the executive director deleted text begin for the
service pension. The service pension payable is the nonforfeitable percentage of the service
pension under section 353G.09, subdivision 2, and is payable deleted text end new text begin .
new text end

new text begin Subd. 3. new text end

new text begin Retirement benefit during period of deferral. new text end

new text begin (a) A volunteer firefighter's
account in the defined contribution plan must continue to be invested with the rest of the
assets of the individual accounts in the volunteer firefighter's fire department account and,
until the account is distributed, credited with investment earnings or reduced by investment
losses under section 353G.082, subdivision 4, and a deduction taken for an equal share of
the administrative expenses under section 353G.082, subdivision 3, paragraph (b), until the
volunteer firefighter's account is distributed.
new text end

new text begin (b) A volunteer firefighter's retirement benefit in the defined benefit plan must be retained
in the defined benefit plan new text end without any interest on or increase in the service pension deleted text begin over deleted text end
new text begin during new text end the period of deferral.

new text begin Subd. 4. new text end

new text begin Forfeiture of accounts of volunteer firefighters who end service. new text end

new text begin (a) The
portion of an account or pension benefit that is not vested is forfeited as of the earliest of:
new text end

new text begin (1) the last day of the calendar year that includes the fifth anniversary of the date on
which the volunteer firefighter ended service;
new text end

new text begin (2) immediately upon receiving a lump-sum payment of the entire vested portion of the
account or pension benefit; or
new text end

new text begin (3) immediately upon receiving the final payment consisting of the entire amount
remaining in the account or pension benefit that is vested.
new text end

new text begin (b) A volunteer firefighter with a zero percent vested interest in the account or pension
benefit is deemed to have received a distribution on the last day of service, and the account
or pension benefit must immediately be forfeited.
new text end

new text begin (c) Amounts forfeited remain forfeited and must not be reinstated upon the resumption
of service with the fire department or any other fire department covered by the retirement
plan.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective January 1, 2025.
new text end

Sec. 36.

Minnesota Statutes 2023 Supplement, section 353G.11, subdivision 2, is amended
to read:

Subd. 2.

new text begin Benefit level changes in the new text end lump-sum division deleted text begin level selection deleted text end new text begin of the defined
benefit plan new text end .

new text begin (a) A fire department's fire chief or the governing body operating a fire
department may request an increase in the benefit level as provided in this subdivision.
new text end

new text begin (b) The fire chief or governing body must request new text end a cost estimate from the executive
director of an increase in the service pension level applicable to the active firefighters of
the fire department deleted text begin may be requested by: (1) the fire chief of a department that has active
membership covered by the lump-sum division; or (2) the governing body operating a fire
department that has active membership covered by the lump-sum division.
deleted text end

new text begin (c) The executive director must prepare the cost estimate using a procedure certified as
accurate by the approved actuary retained by the association.
new text end

new text begin (d) new text end Within 120 days deleted text begin of the receipt of deleted text end new text begin after receiving new text end the cost estimate deleted text begin prepared by deleted text end new text begin from
new text end the executive director deleted text begin using a procedure certified as accurate by the approved actuary retained
by the Public Employees Retirement Association deleted text end , the governing body may approve the
deleted text begin service pension deleted text end new text begin benefit new text end level change, effective for January 1 of the following calendar year
unless the governing body specifies in the approval document an effective date that is
January 1 of the second year following the approval date. If the approval occurs after April
30, the required municipal contribution for the following calendar year must be recalculated
and the results reported to the governing body. If not approved within 120 days of the receipt
of the cost estimate, the deleted text begin service pension deleted text end new text begin benefit new text end level change is considered to have been
disapproved.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective January 1, 2025.
new text end

Sec. 37.

Minnesota Statutes 2023 Supplement, section 353G.11, is amended by adding a
subdivision to read:

new text begin Subd. 2a. new text end

new text begin Benefit level changes in the monthly division of the defined benefit plan. new text end

new text begin (a)
The fire chief of a fire department that has an active membership that is covered by the
monthly benefit retirement division of the plan may initiate the process of modifying the
retirement benefit plan document under this section.
new text end

new text begin (b) The modification procedure is initiated when the applicable fire chief files with the
executive director of the Public Employees Retirement Association a written summary of
the desired benefit plan document modification, the proposed benefit plan document
modification language, a written request for the preparation of an actuarial cost estimate
for the proposed benefit plan document modification, and payment of the estimated cost of
the actuarial cost estimate.
new text end

new text begin (c) Upon receipt of the modification request and related documents, the executive director
shall review the language of the proposed benefit plan document modification and, if a
clarification is needed in the submitted language, shall inform the fire chief of the necessary
clarification. Once the proposed benefit plan document modification language has been
clarified by the fire chief and resubmitted to the executive director, the executive director
shall arrange for the approved actuary retained by the Public Employees Retirement
Association to prepare a benefit plan document modification cost estimate under the
applicable provisions of section 356.215 and of the standards for actuarial work adopted
by the Legislative Commission on Pensions and Retirement. Upon completion of the benefit
plan document modification cost estimate, the executive director shall forward the estimate
to the fire chief who requested it and to the chief financial officer of the municipality or
entity with which the fire department is primarily associated.
new text end

new text begin (d) The fire chief, upon receipt of the cost estimate, shall circulate the cost estimate with
the active firefighters in the fire department and shall take reasonable steps to provide the
estimate results to any affected retired members of the fire department and their beneficiaries.
The chief financial officer of the municipality or entity associated with the fire department
shall present the proposed modification language and the cost estimate to the governing
body of the municipality or entity for its consideration at a public hearing held for that
purpose.
new text end

new text begin (e) If the governing body of the municipality or entity approves the modification language,
the chief administrative officer of the municipality or entity shall notify the executive director
of the Public Employees Retirement Association of that approval. The benefit plan document
modification is effective on the January 1 following the date of filing the approval with the
Public Employees Retirement Association.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective January 1, 2025.
new text end

Sec. 38.

new text begin [353G.114] ANCILLARY BENEFITS AND SUPPLEMENTAL BENEFITS.
new text end

new text begin (a) Except as provided under paragraph (b) and sections 353G.115 and 353G.12, no
disability, death, funeral, or other ancillary benefit beyond a retirement benefit is payable
from the lump-sum division of the defined benefit plan or the defined contribution plan.
new text end

new text begin (b) Any member or survivor of a deceased member who receives a lump-sum distribution
of the member's retirement benefit from the lump-sum division of the defined benefit plan
or the defined contribution plan is entitled to a supplemental benefit under section 424A.10.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective January 1, 2025.
new text end

Sec. 39.

Minnesota Statutes 2023 Supplement, section 353G.115, is amended to read:

353G.115 DISABILITY BENEFIT COVERAGE; AUTHORITY FOR deleted text begin CASUALTY deleted text end
new text begin DISABILITY new text end INSURANCE.

(a) Except as provided in paragraph (b) deleted text begin or (c) deleted text end , no disability benefit is payable from the
deleted text begin statewide deleted text end new text begin retirement new text end plan.

deleted text begin (b) If the board approves the arrangement, disability coverage for the lump-sum division
of the statewide plan members may be provided through a group disability insurance policy
obtained from an insurance company licensed to do business in this state. The lump-sum
retirement account of the statewide volunteer firefighter plan is authorized to pay the premium
for the disability insurance authorized by this paragraph. The proportional amount of the
total annual disability insurance premium must be added to the required contribution amount
determined under section 353G.08.
deleted text end

deleted text begin (c) deleted text end new text begin (b) new text end The disability benefit coverage for new text begin a fire department in new text end the monthly deleted text begin benefit deleted text end
division is the disability service pension amount specified in the new text begin retirement new text end benefit plan
document applicable to the deleted text begin fire department, applicable deleted text end former deleted text begin volunteer firefighter deleted text end relief
association new text begin affiliated with the fire department and new text end in effect as of the last day before the date
on which retirement coverage transferred to the deleted text begin statewide volunteer firefighter deleted text end new text begin retirement
new text end plan, subject to all conditions and limitations in the disability service pension specified
therein.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective January 1, 2025.
new text end

Sec. 40.

Minnesota Statutes 2023 Supplement, section 353G.12, subdivision 2, is amended
to read:

Subd. 2.

Lump-sum deleted text begin plan deleted text end new text begin division new text end ; survivor benefit amount.

The amount of the
survivor benefit for the lump-sum division is the amount of the deleted text begin lump-sum service pension deleted text end
new text begin retirement benefit new text end that would have been payable to the member of the lump-sum division
on the date of death if the member had been age 50 or older on that date.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective January 1, 2025.
new text end

Sec. 41.

Minnesota Statutes 2023 Supplement, section 353G.12, is amended by adding a
subdivision to read:

new text begin Subd. 4. new text end

new text begin Defined contribution plan; survivor benefit amount. new text end

new text begin The amount of the
survivor benefit for the defined contribution plan is the amount credited to the individual
account of the deceased member on the date of death.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective January 1, 2025.
new text end

Sec. 42.

Minnesota Statutes 2023 Supplement, section 353G.14, is amended to read:

353G.14 DISTRIBUTIONS deleted text begin FROM LUMP-SUM DIVISION deleted text end .

Subdivision 1.

Lump sum.

deleted text begin Unless a volunteer firefighter requests an annuity under
subdivision 2, deleted text end The executive director must distribute deleted text begin a deleted text end new text begin the retirement benefit under section
353G.09, subdivision 1a, of a member of the new text end lump-sum deleted text begin service pension deleted text end new text begin division of the
defined benefit plan or the defined contribution plan new text end in the form of a single new text begin lump-sum
new text end payment deleted text begin from the account of each fire department covered by the plan in which the volunteer
firefighter earned a retirement benefit under section 353G.09 deleted text end .

Subd. 2.

deleted text begin Annuity deleted text end new text begin Monthly payments new text end .

deleted text begin The executive director may purchase an annuity
contract on behalf of a volunteer firefighter retiring from the lump-sum division of the plan
with a total premium payment in an amount equal to the lump-sum service pension payable
under section 353G.09 if the purchase was requested by the volunteer firefighter in a manner
prescribed by the executive director. The annuity contract must be purchased from an
insurance carrier that is licensed to do business in this state. If purchased, the annuity contract
is in lieu of any service pension or other benefit from the lump-sum plan of the plan. The
annuity contract may be purchased at any time after the volunteer firefighter discontinues
active service, but the annuity contract must stipulate that no annuity amounts are payable
before the volunteer firefighter attains the age of 50. deleted text end new text begin The executive director must distribute
the retirement benefit under section 353G.09, subdivision 1a, of a member of the monthly
division of the defined benefit plan in the form of monthly payments as authorized under
the retirement benefit plan document for the fire department in which the member is
employed or for which the member provides services.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective January 1, 2025.
new text end

Sec. 43.

new text begin [353G.19] CONVERSION TO DEFINED CONTRIBUTION PLAN.
new text end

new text begin Subdivision 1. new text end

new text begin Authority to initiate conversion. new text end

new text begin (a) A participating employer associated
with a fire department covered by the defined benefit plan, including an entity previously
affiliated with a defined benefit relief association when the entity made a request for coverage
by the defined contribution plan under section 353G.05, subdivision 1b, paragraph (c), may
convert to coverage by the defined contribution plan in accordance with this section.
new text end

new text begin (b) Conversion from coverage by the defined benefit plan to coverage by the defined
contribution plan consists of:
new text end

new text begin (1) a resolution by the governing body of the participating employer;
new text end

new text begin (2) notice to all former and active volunteer firefighters of the fire department;
new text end

new text begin (3) full vesting of all active and former volunteer firefighters with an accrued benefit in
the defined benefit plan attributable to service with the fire department; and
new text end

new text begin (4) allocation of surplus over full funding, if any, to individual accounts in the fire
department's new account in the defined contribution plan.
new text end

new text begin (c) For an entity previously affiliated with a defined benefit relief association when the
entity made a request for coverage by the defined contribution plan under section 353G.05,
subdivision 1b, paragraph (c), a conversion must occur under paragraph (b) immediately
after coverage by the retirement plan of the entity's fire department and the entity's volunteer
firefighters takes effect.
new text end

new text begin Subd. 2. new text end

new text begin Resolutions by the governing body. new text end

new text begin To initiate a conversion, the governing
body of the participating employer must file with the executive director at least 30 days
before the end of a calendar year:
new text end

new text begin (1) a resolution that states that the fire department elects to participate in the defined
contribution plan effective on conversion effective date, which is the first day of the next
calendar year; and
new text end

new text begin (2) if the fire department account had a deficit from full funding as defined under section
353G.08, subdivision 1, paragraph (c), or the special fund of the defined benefit relief
association had a deficit from full funding as defined in section 424A.092, subdivision 3,
paragraph (b), a resolution approving a contribution to the retirement plan in the amount
necessary to eliminate the deficit, which is to be paid within 30 days of the filing of the
resolution or in installments over three years, with the first payment to be made within 30
days of the filing of the resolution.
new text end

new text begin Subd. 3. new text end

new text begin Notice to participants. new text end

new text begin The participating employer must provide notice to all
active and former volunteer firefighters in the fire department at least 30 days before the
conversion effective date. The notice must include:
new text end

new text begin (1) an explanation that the plan is converting from a defined benefit plan to a defined
contribution plan, including definitions of those terms, on the conversion effective date and
that the active and former volunteer firefighters will become fully vested in their accrued
benefit as of the conversion effective date;
new text end

new text begin (2) a summary of the terms of the defined contribution plan;
new text end

new text begin (3) a section tailored to each volunteer firefighter that provides an estimate of the present
value of the participant's fully vested accrued benefit and the calculation that resulted in
that value;
new text end

new text begin (4) an estimate of any anticipated surplus and an explanation of the allocation of the
surplus; and
new text end

new text begin (5) contact information for the chief administrative officer or chief financial officer of
the participating employer and the designated staff member of the retirement plan who will
answer questions and directions to a website.
new text end

new text begin Subd. 4. new text end

new text begin Full vesting and determination of accrued benefit. new text end

new text begin (a) On the conversion
effective date, each active or former volunteer firefighter with a retirement benefit under
the defined benefit plan, except any retiree in pay status who is receiving a monthly benefit,
becomes 100 percent vested as of the conversion effective date in the firefighter's retirement
benefit, without regard to the number of years of vesting service credit.
new text end

new text begin (b) The executive director must determine the present value of each active or former
firefighter's accrued benefit as of the conversion effective date, taking into account the full
vesting requirement under paragraph (a).
new text end

new text begin Subd. 5. new text end

new text begin Surplus over full funding. new text end

new text begin If the fire department account has a surplus over
full funding, as defined under section 353G.08, subdivision 1, paragraph (c), the executive
director must allocate the surplus over full funding to the individual account of each active
and former volunteer firefighter, except any former volunteer firefighter receiving an annuity,
in the same proportion that the volunteer firefighter's accrued benefit bears to the total
accrued benefits of all active and former volunteer firefighters.
new text end

new text begin Subd. 6. new text end

new text begin Distribution to former volunteer firefighters in pay status. new text end

new text begin (a) If any former
volunteer firefighter or beneficiary is receiving an annuity, the executive director must
determine the present value of the remaining payments to the former volunteer firefighter
or beneficiary and offer the former volunteer firefighter or beneficiary:
new text end

new text begin (1) continued payments in the same monthly amount; or
new text end

new text begin (2) an immediate lump-sum distribution of the present value amount.
new text end

new text begin (b) The offer of an immediate lump-sum distribution must include an offer to the former
volunteer firefighter or beneficiary to elect a direct rollover of the amount to an eligible
retirement plan as permitted under section 356.635, subdivisions 3 to 7, if the distribution
is an eligible rollover distribution as defined in section 356.635, subdivisions 4 and 5.
new text end

new text begin Subd. 7. new text end

new text begin Prohibition against reduction in accrued benefit. new text end

new text begin In no event may the value
of a volunteer firefighter's individual account in the defined contribution plan be less as of
the day following the conversion effective date than the present value of the volunteer
firefighter's accrued benefit as of the day before the conversion effective date.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective January 1, 2026.
new text end

Sec. 44. new text begin REVISOR INSTRUCTION.
new text end

new text begin The revisor of statutes shall change the following terms wherever the terms appear in
Minnesota Statutes, chapter 353G, unless the context indicates that the previous term should
remain. The revisor of statutes shall also make grammatical changes related to the changes
in terms:
new text end

new text begin (1) "Public Employees Retirement Association" to "association";
new text end

new text begin (2) "independent nonprofit firefighting corporation" to "firefighting corporation"; and
new text end

new text begin (3) "monthly benefit division" to "monthly division."
new text end

Sec. 45. new text begin REPEALER.
new text end

new text begin (a) new text end new text begin Minnesota Statutes 2022, section 353G.01, subdivision 10, new text end new text begin is repealed.
new text end

new text begin (b) new text end new text begin Minnesota Statutes 2023 Supplement, sections 353G.01, subdivisions 7a and 8a;
353G.02, subdivision 6; 353G.08, subdivision 3; 353G.11, subdivisions 1, 1a, 3, and 4;
353G.112; and 353G.121, new text end new text begin are repealed.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective January 1, 2025.
new text end

APPENDIX

Repealed Minnesota Statutes: 24-07785

353G.01 DEFINITIONS.

Subd. 7a.

Lump-sum account.

"Lump-sum account" means that portion of the retirement fund that contains the assets applicable to the lump-sum division.

Subd. 8a.

Monthly benefit account.

"Monthly benefit account" means that portion of the fund that contains the assets applicable to the monthly benefit division.

Subd. 10.

Plan.

"Plan" means the retirement plan established by this chapter.

353G.02 PLAN AND FUND CREATION.

Subd. 6.

Initial administrative expenses of the monthly benefit division; allocation of reimbursement.

The administration expenses incurred by the Public Employees Retirement Association in the establishment of the monthly benefit division of the statewide volunteer firefighter plan, including any computer programming expenses and any actuarial consultant expenses, are payable from the assets of the initial monthly benefit volunteer firefighter relief association that elects to transfer its administration to the statewide volunteer firefighter plan, following the transfer of assets.

353G.08 PLAN FUNDING; DISBURSEMENTS.

Subd. 3.

Authorized account disbursements.

The assets of a lump-sum retirement account or of a monthly benefit retirement account of the retirement fund may only be disbursed for:

(1) the administrative expenses of the plan;

(2) the investment expenses of the retirement fund;

(3) the service pensions payable under section 353G.10, 353G.11, 353G.14, or 353G.18;

(4) the survivor benefits payable under section 353G.12;

(5) the disability benefit coverage insurance premiums under section 353G.115; and

(6) a transfer of assets under section 353G.17.

353G.11 LUMP-SUM DIVISION SERVICE PENSION LEVELS.

Subdivision 1.

Service pension levels; lump-sum division.

Except as provided in subdivision 1a, the lump-sum division of the plan provides the following levels of service pension amounts per full year of service credit to be selected at the election of coverage:

(1) a minimum service pension level of $500 per year;

(2) a maximum service pension level equal to the maximum lump-sum service pension amount permitted under section 424A.02, subdivision 3, payable for each year of service; and

(3) service pension levels between the minimum level and the maximum level in $100 increments.

Subd. 1a.

Continuation of prior lump-sum service pension levels.

(a) If a municipality or independent nonprofit firefighting corporation elected to be covered by the lump-sum division of the plan before January 1, 2010, and selected the $750 per year of service credit service pension amount effective for January 1, 2010, that level continues for the volunteer firefighters of that municipality or independent nonprofit firefighting corporation until a different service pension amount is selected under subdivision 2 after January 1, 2010.

(b) If a municipality or independent nonprofit firefighting corporation elected to be covered by the plan before January 1, 2015, and selected a service pension level under subdivision 1, other than a service credit service pension amount under subdivision 1, that level continues for the volunteer firefighters of the municipality or independent nonprofit firefighting corporation until a different service pension amount is selected under subdivision 2 after January 1, 2014.

Subd. 3.

Supplemental benefit.

The lump-sum retirement account of the plan also shall pay a supplemental benefit as provided for in section 424A.10.

Subd. 4.

Ancillary benefits.

Except as provided under section 353G.115 or 353G.12, no disability, death, funeral, or other ancillary benefit beyond a service pension or a survivor benefit is payable from the lump-sum retirement account of the plan.

353G.112 MONTHLY BENEFIT DIVISION SERVICE PENSION LEVELS.

The service pension amount for the firefighters of a fire department covered by the monthly benefit division of the plan is the amount specified in the retirement benefit plan document applicable to the fire department.

353G.121 MONTHLY BENEFIT DIVISION; POST-TRANSFER BENEFIT PLAN DOCUMENT MODIFICATIONS.

(a) The fire chief of a fire department that has an active membership who are covered by the monthly benefit division of the plan may initiate the process of modifying the retirement benefit plan document under this section.

(b) The modification procedure is initiated when the applicable fire chief files with the executive director of the Public Employees Retirement Association a written summary of the desired benefit plan document modification, the proposed benefit plan document modification language, a written request for the preparation of an actuarial cost estimate for the proposed benefit plan document modification, and payment of the estimated cost of the actuarial cost estimate.

(c) Upon receipt of the modification request and related documents, the executive director shall review the language of the proposed benefit plan document modification and, if a clarification is needed in the submitted language, shall inform the fire chief of the necessary clarification. Once the proposed benefit plan document modification language has been clarified by the fire chief and resubmitted to the executive director, the executive director shall arrange for the approved actuary retained by the Public Employees Retirement Association to prepare a benefit plan document modification cost estimate under the applicable provisions of section 356.215 and of the standards for actuarial work adopted by the Legislative Commission on Pensions and Retirement. Upon completion of the benefit plan document modification cost estimate, the executive director shall forward the estimate to the fire chief who requested it and to the chief financial officer of the municipality or entity with which the fire department is primarily associated.

(d) The fire chief, upon receipt of the cost estimate, shall circulate the cost estimate with the active firefighters in the fire department and shall take reasonable steps to provide the estimate results to any affected retired members of the fire department and their beneficiaries. The chief financial officer of the municipality or entity associated with the fire department shall present the proposed modification language and the cost estimate to the governing body of the municipality or entity for its consideration at a public hearing held for that purpose.

(e) If the governing body of the municipality or entity approves the modification language, the chief administrative officer of the municipality or entity shall notify the executive director of the Public Employees Retirement Association of that approval. The benefit plan document modification is effective on the January 1 next following the date of filing the approval with the Public Employees Retirement Association.