1.1 	A bill for an act
1.2 	relating to retirement; Public Employees Retirement
1.3 	Association; requiring fees be paid in certain
1.4 	circumstances; amending Minnesota Statutes 2004,
1.5 	section 353.03, subdivision 3.
1.6 	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

1.7 	Section 1. Minnesota Statutes 2004, section 353.03,
1.8 	subdivision 3, is amended to read:
1.9 		Subd. 3.Duties and powers of the board.  (a) The board
1.10 	shall elect a president and vice-president.  The board shall
1.11 	approve the staffing complement necessary to administer the
1.12 	fund.  The cost of administering this chapter must be paid by
1.13 	the fund.
1.14 	(b) The board shall adopt bylaws for its own government and
1.15 	for the management of the fund consistent with the laws of the
1.16 	state and may modify them at pleasure.  It shall adopt, alter,
1.17 	and enforce reasonable rules consistent with the laws of the
1.18 	state for the administration and management of the fund, for the
1.19 	payment and collection of payments from members, and for the
1.20 	payment of withdrawals and benefits.  It shall pass upon and
1.21 	allow or disallow all applications for membership in the fund
1.22 	and shall allow or disallow claims for withdrawals, pensions, or
1.23 	benefits payable from the fund.  It shall adopt an appropriate
1.24 	mortality table based on experience of the fund as recommended
1.25 	by the association actuary, with interest set at the rate
2.1 	specified in section 356.215, subdivision 8.  It shall provide
2.2 	for the payment out of the fund of all necessary expenses for
2.3 	the administration of the fund and of all claims for
2.4 	withdrawals, pensions, or benefits allowed.  The board shall
2.5 	approve or disapprove all recommendations and actions of the
2.6 	executive director made subject to its approval or disapproval
2.7 	by subdivision 3a.
2.8 	(c) In passing upon all applications and claims, the board
2.9 	may summon, swear, hear, and examine witnesses and, in the case
2.10 	of claims for disability benefits, may require the claimant to
2.11 	submit to a medical examination by a physician of the board's
2.12 	choice, at the expense of the fund, as a condition precedent to
2.13 	the passing on the claim, and, in the case of all applications
2.14 	and claims, may conduct investigations necessary to determine
2.15 	their validity and merit.  The board shall establish procedures
2.16 	to assure that a benefit applicant and recipient may have a
2.17 	review of a benefit eligibility or benefit amount determination
2.18 	affecting the applicant or recipient.  The review procedure may
2.19 	afford the benefit applicant or benefit recipient an opportunity
2.20 	to present views at any review proceeding conducted, but is not
2.21 	a contested case under chapter 14.
2.22 	(d) A governmental subdivision covered by this chapter
2.23 	shall pay an employee's costs of appeal and petition when:
2.24 	(1) a public employee of the governmental subdivision has
2.25 	applied for a disability benefit;
2.26 	(2) the employee's initial application has been denied;
2.27 	(3) the governmental subdivision requires the employee to
2.28 	seek administrative review of the denial;
2.29 	(4) the review is required to be through a fact-finding
2.30 	conference or a petition for review by the board of trustees;
2.31 	and 
2.32 	(5) the review requirement is a condition of employment or
2.33 	a condition of application for a benefit.
2.34 	(e) The board may continue to authorize the sale of life
2.35 	insurance to members under the insurance program in effect on
2.36 	January 1, 1985, but must not change that program without the
3.1 	approval of the commissioner of finance.  The association shall
3.2 	not receive any financial benefit from the life insurance
3.3 	program beyond the amount necessary to reimburse the association
3.4 	for costs incurred in administering the program.  The
3.5 	association shall not engage directly or indirectly in any other
3.6 	activity involving the sale or promotion of goods or services,
3.7 	or both, whether to members or nonmembers.
3.8 	(e) (f) The board shall establish procedures governing
3.9 	reimbursement of expenses to board members.  These procedures
3.10 	shall define the types of activities and expenses that qualify
3.11 	for reimbursement, shall provide that all out-of-state travel
3.12 	must be authorized by the board, and shall provide for
3.13 	independent verification of claims for expense reimbursement.
3.14 	The procedures must comply with applicable rules and policies of
3.15 	the Department of Finance, the Department of Administration, and
3.16 	the Department of Employee Relations.
3.17 	(f) (g) The board may purchase fiduciary liability
3.18 	insurance and official bonds for the officers and members of the
3.19 	board of trustees and employees of the association and may
3.20 	purchase property insurance or may establish a self-insurance
3.21 	risk reserve including, but not limited to, data processing
3.22 	insurance and "extra-expense" coverage.