1.1 	A bill for an act
1.2 	relating to retirement; various retirement plans; adding two employment 
1.3 	positions to the correctional state employees retirement plan; including certain 
1.4 	departments of the Rice Memorial Hospital in Willmar and the Worthington 
1.5 	Regional Hospital in privatized public employee retirement coverage; providing 
1.6 	for the potential dissolution of the Minnesota Post Retirement Investment Fund; 
1.7 	increasing teacher retirement plan reemployed annuitant earnings limitations; 
1.8 	temporarily exempting Metropolitan Airports Commission police officers from 
1.9 	reemployed annuitant earnings limits; mandating joint and survivor optional 
1.10 	annuities rather than single life annuities as basic annuity form; making various 
1.11 	changes in retirement plan administrative provisions; clarifying general state 
1.12 	employee retirement plan alternative coverage elections by certain unclassified 
1.13 	state employees retirement program participants; clarifying direct state aid 
1.14 	for the teacher retirement associations; clarifying the handling of unclaimed 
1.15 	retirement accounts in the individual retirement account plan; providing for 
1.16 	a study of certain Minnesota State Colleges and Universities System tenure 
1.17 	track faculty members;  modifying the manner in which official actuarial work 
1.18 	for public pension plans is performed; allowing pension plans greater latitude 
1.19 	in setting salary and payroll assumptions; extending amortization target dates 
1.20 	for various retirement plans; making the number and identity of tax-sheltered 
1.21 	annuity vendors a mandatory bargaining item for school districts and their 
1.22 	employees; allowing a certain firefighter relief association certain benefit 
1.23 	increases; allowing security broker-dealers to directly hold local pension 
1.24 	plan assets; increasing upmost flexible service pension maximum amounts 
1.25 	for volunteer firefighters; creating a voluntary statewide volunteer firefighter 
1.26 	retirement plan advisory board within the Public Employees Retirement 
1.27 	Association; allowing various retirement plans to accept labor union retired 
1.28 	member dues deduction authorizations; authorizing various prior service credit 
1.29 	purchases; authorizing certain service credit and coverage transfers; authorizing 
1.30 	a disability benefit application to be rescinded; authorizing a retirement coverage 
1.31 	termination; providing an additional benefit to certain injured Minneapolis 
1.32 	bomb squad officers; allowing certain Independent School District No. 625 
1.33 	school board members to make back defined contribution retirement plan 
1.34 	contributions; revising post-2009 additional amortization state aid allocations; 
1.35 	modifying PERA-P&F duty disability benefit amounts; authorizing a PERA 
1.36 	prior military service credit purchase; revising the administrative duties of the 
1.37 	board and the executive director of the Minnesota State Retirement System; 
1.38 	increasing pension commission membership; appropriating money;amending 
1.39 	Minnesota Statutes 2006, sections 3.85, subdivision 3; 6.67; 11A.18, subdivision 
2.1 	9, by adding subdivisions; 16A.055, subdivision 5; 43A.346, subdivisions 4, 
2.2 	5, 6, 7; 69.011, subdivision 1; 123B.02, subdivision 15; 352.03, subdivisions 
2.3 	4, 5; 352.12, subdivision 2; 352.22, subdivision 10; 352.931, subdivision 1; 
2.4 	352.97; 352.98, subdivisions 1, 2, 3, 4, 5; 352D.075, subdivision 2a; 353.01, 
2.5 	subdivisions 10, 11a, by adding a subdivision; 353.27, by adding a subdivision; 
2.6 	353.30, subdivision 3; 353.33, subdivision 5; 353.64, subdivision 11; 353.656, 
2.7 	subdivision 2; 353D.05, subdivision 2; 353D.12, subdivision 4; 353E.07, 
2.8 	subdivision 7; 354.05, subdivision 37; 354.33, subdivision 5; 354.44, subdivision 
2.9 	5; 354A.12, subdivision 3a; 354A.31, subdivision 3; 354B.20, by adding a 
2.10 	subdivision; 354B.25, subdivision 5, by adding a subdivision; 354C.165; 356.20, 
2.11 	subdivisions 1, 2, 3, 4, 4a; 356.214, subdivisions 1, 3, by adding a subdivision; 
2.12 	356.215, subdivisions 1, 2, 3, 8, 11, 18; 356.24, subdivision 1; 356.41; 356.46, as 
2.13 	amended; 356.47, subdivision 3; 356.551, subdivision 2; 356.611, subdivision 2, 
2.14 	by adding a subdivision; 356A.06, subdivisions 1, 7, 8b; 356B.10, subdivision 
2.15 	3; 363A.36, subdivision 1; 383B.914, subdivision 7; 423A.02, subdivision 
2.16 	1b; 424A.001, subdivision 6, by adding a subdivision; 424A.02, subdivisions 
2.17 	3, 7, 9; 424A.05, subdivision 3; 518.003, subdivision 8; Minnesota Statutes 
2.18 	2007 Supplement, sections 43A.346, subdivisions 1, 2; 352.01, subdivision 
2.19 	2a; 352.017, subdivision 2; 352.91, subdivision 3d; 352.955, subdivisions 3, 
2.20 	5; 352D.02, subdivisions 1, 3; 353.01, subdivision 2b; 353.0161, subdivision 
2.21 	2; 353.27, subdivision 14; 353.32, subdivision 1a; 353.656, subdivision 1; 
2.22 	353.657, subdivision 2a; 353F.02, subdivision 4; 354.096, subdivision 2; 354.72, 
2.23 	subdivision 2; 354A.12, subdivision 3c; 354C.12, subdivision 4; 356.96, 
2.24 	subdivision 1; 422A.06, subdivision 8; Laws 2002, chapter 392, article 2, section 
2.25 	4; Laws 2006, chapter 271, article 5, section 5; proposing coding for new law 
2.26 	in Minnesota Statutes, chapters 11A; 352; 353D; 353F; 354; 354C; 356; 423A; 
2.27 	repealing Minnesota Statutes 2006, sections 352.96; 354.44, subdivision 6a; 
2.28 	354.465; 354.51, subdivision 4; 354.55, subdivisions 2, 3, 6, 12, 15; 354A.091, 
2.29 	subdivisions 1a, 1b; 354A.12, subdivision 3a; 355.629; 356.214, subdivision 2; 
2.30 	356.215, subdivision 2a; Minnesota Statutes 2007 Supplement, section 354A.12, 
2.31 	subdivisions 3b, 3c; Laws 1965, chapter 592, sections 3, as amended; 4, as 
2.32 	amended; Laws 1967, chapter 575, sections 2, as amended; 3; 4; Laws 1969, 
2.33 	chapter 352, section 1, subdivisions 3, 4, 5, 6; Laws 1969, chapter 526, sections 
2.34 	3; 4; 5, as amended; 7, as amended; Laws 1971, chapter 140, sections 2, as 
2.35 	amended; 3, as amended; 4, as amended; 5, as amended; Laws 1971, chapter 
2.36 	214, section 1, subdivisions 1, 2, 3, 4, 5; Laws 1973, chapter 304, section 1, 
2.37 	subdivisions 3, 4, 5, 6, 7, 8, 9; Laws 1973, chapter 472, section 1, as amended; 
2.38 	Laws 1975, chapter 185, section 1; Laws 1985, chapter 261, section 37, as 
2.39 	amended; Laws 1991, chapter 125, section 1; Laws 1993, chapter 244, article 
2.40 	4, section 1; Laws 2005, First Special Session chapter 8, article 1, section 
2.41 	23; Minnesota Rules, parts 7905.0100; 7905.0200; 7905.0300; 7905.0400; 
2.42 	7905.0500; 7905.0600; 7905.0700; 7905.0800; 7905.0900; 7905.1000; 
2.43 	7905.1100; 7905.1200; 7905.1300; 7905.1400; 7905.1500; 7905.1600; 
2.44 	7905.1700; 7905.1800; 7905.1900; 7905.2000; 7905.2100; 7905.2200; 
2.45 	7905.2300; 7905.2400; 7905.2450; 7905.2500; 7905.2560; 7905.2600; 
2.46 	7905.2700; 7905.2800; 7905.2900.
2.47 	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

2.48 	ARTICLE 1
2.49 	POSTRETIREMENT PROVISIONS

2.50 	Section 1. Minnesota Statutes 2006, section 11A.18, is amended by adding a 
2.51 	subdivision to read:
3.1 		Subd. 2a.Composite funded ratio. (a) Annually, following June 30, the executive 
3.2 	director of the State Board of Investment shall determine the composite funded ratio 
3.3 	of the postretirement investment fund. The composite funded ratio must be stated as a 
3.4 	percentage and must be calculated using:
3.5 	(1) the total fair market value of the postretirement investment fund as of June 30, 
3.6 	calculated in accordance with generally accepted accounting principles; divided by
3.7 	(2) the total reserves required as of June 30 for the annuities or benefits payable from 
3.8 	the postretirement investment fund on that June 30 to all recipients of participating public 
3.9 	pension plans or funds, as determined by the actuary retained under section 356.214 using 
3.10 	the applicable assumptions in section 356.215.
3.11 	(b) The executive director of the State Board of Investment shall certify the 
3.12 	composite funded ratio to the executive directors of the plans participating in the 
3.13 	Minnesota postretirement investment fund and to the executive director of the Legislative 
3.14 	Commission on Pensions and Retirement by November 30 annually.

3.15 	EFFECTIVE DATE. This section is effective June 30, 2008.

3.16 	Sec. 2. Minnesota Statutes 2006, section 11A.18, subdivision 9, is amended to read:
3.17 		Subd. 9.Calculation of postretirement adjustment.  (a) Annually, following June 
3.18 	30, the state board shall use the procedures in paragraphs (b), (c), and (d) to determine 
3.19 	whether a postretirement adjustment under this subdivision is payable and to determine 
3.20 	the amount of any postretirement adjustment under this subdivision.
3.21 	(b)(1) If the Consumer Price Index for urban wage earners and clerical workers all 
3.22 	items index published by the Bureau of Labor Statistics of the United States Department 
3.23 	of Labor increases from June 30 of the preceding year to June 30 of the current year, the 
3.24 	state board shall certify the percentage increase.
3.25 	(2) The amount certified must not exceed the lesser of the difference between the 
3.26 	preretirement interest assumption and postretirement interest assumption in section 
3.27 	356.215, subdivision 8, paragraph (a), or 2.5 percent for the Minneapolis Employees 
3.28 	Retirement Fund, the amount certified must not exceed 3.5 percent.
3.29 	(c) If the amount calculated under paragraph (b), clause (1), is greater than the 
3.30 	maximum amount allowable under paragraph (b), clause (2),  in addition to any percentage 
3.31 	increase certified under paragraph (b), the board shall use the following procedures to 
3.32 	determine if a postretirement adjustment is payable under this paragraph:
3.33 	(1) the state board shall determine the total fair market value of the fund on June 
3.34 	30 of that year;
4.1 	(2) the amount of reserves required as of the current June 30 for the annuity or 
4.2 	benefit payable to an annuitant and benefit recipient of the participating public pension 
4.3 	plans or funds must be determined by the actuary retained under section 356.214. An 
4.4 	annuitant or benefit recipient who has been receiving an annuity or benefit for at least 12 
4.5 	full months as of the current June 30 is eligible to receive a full postretirement adjustment. 
4.6 	An annuitant or benefit recipient who has been receiving an annuity or benefit for at 
4.7 	least one full month, but less than 12 full months as of the current June 30, is eligible to 
4.8 	receive a partial postretirement adjustment. Each fund shall report separately the amount 
4.9 	of the reserves for those annuitants and benefit recipients who are eligible to receive 
4.10 	a full postretirement benefit adjustment. This amount is known as "eligible reserves." 
4.11 	Each fund shall also report separately the amount of the reserves for those annuitants 
4.12 	and benefit recipients who are not eligible to receive a postretirement adjustment. This 
4.13 	amount is known as "noneligible reserves." For an annuitant or benefit recipient who is 
4.14 	eligible to receive a partial postretirement adjustment, each fund shall report separately 
4.15 	as additional "eligible reserves" an amount that bears the same ratio to the total reserves 
4.16 	required for the annuitant or benefit recipient as the number of full months of annuity 
4.17 	or benefit receipt as of the current June 30 bears to 12 full months. The remainder of 
4.18 	the annuitant's or benefit recipient's reserves must be separately reported as additional 
4.19 	"noneligible reserves." The amount of "eligible" and "noneligible" required reserves 
4.20 	must be certified to the board by the actuary retained under section 356.214  as soon as is 
4.21 	practical following the current June 30;
4.22 	(3) the state board shall determine the percentage increase certified under paragraph 
4.23 	(b) multiplied by the eligible required reserves, as adjusted for mortality gains and losses 
4.24 	under subdivision 11, determined under clause (2);
4.25 	(4) the state board shall add the amount of reserves required for the annuities or 
4.26 	benefits payable to annuitants and benefit recipients of the participating public pension 
4.27 	plans or funds as of the current June 30 to the amount determined under clause (3);
4.28 	(5) the state board shall subtract the amount determined under clause (4) from the 
4.29 	total fair market value of the fund determined under clause (1);
4.30 	(6) the state board shall adjust the amount determined under clause (5) by the 
4.31 	cumulative current balance determined under clause (8) and any negative balance carried 
4.32 	forward under clause (9);
4.33 	(7) a positive amount resulting from the calculations in clauses (1) to (6) is the 
4.34 	excess market value. A negative amount is the negative balance;
5.1 	(8) the state board shall allocate one-fifth of the excess market value or one-fifth 
5.2 	of the negative balance to each of five consecutive years, beginning with the fiscal year 
5.3 	ending the current June 30; and
5.4 	(9) to calculate the postretirement adjustment under this paragraph based on 
5.5 	investment performance for a fiscal year, the state board shall add together all excess 
5.6 	market value allocated to that year and subtract from the sum all negative balances 
5.7 	allocated to that year. If this calculation results in a negative number, the entire negative 
5.8 	balance must be carried forward and allocated to the next year. If the resulting amount is 
5.9 	positive, a postretirement adjustment is payable under this paragraph. The board shall 
5.10 	express a positive amount as a percentage of the total eligible required reserves certified to 
5.11 	the board under clause (2). The percentage determined under this paragraph is not payable 
5.12 	unless the amount calculated under paragraph (b), clause (1), is greater than 2.5 percent 
5.13 	and must not exceed the difference by which the amount calculated under paragraph (b), 
5.14 	clause (1), exceeds 2.5 percent.
5.15 	(d) The state board shall determine the amount of any postretirement adjustment 
5.16 	which is payable using the following procedure:
5.17 	(1) The total "eligible" required reserves as of the first of January next following the 
5.18 	end of the fiscal year for the annuitants and benefit recipients eligible to receive a full or 
5.19 	partial postretirement adjustment as determined by clause (2) must be certified to the state 
5.20 	board by the actuary retained under section 356.214. The total "eligible" required reserves 
5.21 	must be determined by the actuary retained under section 356.214 on the assumption that 
5.22 	all annuitants and benefit recipients eligible to receive a full or partial postretirement 
5.23 	adjustment will be alive on the January 1 in question; and
5.24 	(2) The state board shall add the percentage certified under paragraph (b) to any 
5.25 	positive percentage calculated under paragraph (c). The board shall not subtract from the 
5.26 	percentage certified under paragraph (b) any negative amount calculated under paragraph 
5.27 	(c). The sum of these percentages must be carried to five decimal places and must be 
5.28 	certified to each participating public pension fund or plan as the full postretirement 
5.29 	adjustment percentage. The full postretirement adjustment percentage certified to each 
5.30 	participating public pension plan or fund must not exceed five percent. For the Minneapolis
5.31 	Employees Retirement Fund, no maximum percentage adjustment is applicable.
5.32 	(e) A retirement annuity payable in the event of retirement before becoming eligible 
5.33 	for Social Security benefits as provided in section 352.116, subdivision 3; 353.29, 
5.34 	subdivision 6; or 354.35 must be treated as the sum of a period certain retirement annuity 
5.35 	and a life retirement annuity for the purposes of any postretirement adjustment. The 
5.36 	period certain retirement annuity plus the life retirement annuity must be the annuity 
6.1 	amount payable until age 62 or 65, whichever applies. A postretirement adjustment 
6.2 	granted on the period certain retirement annuity must terminate when the period certain 
6.3 	retirement annuity terminates. 

6.4 	EFFECTIVE DATE. This section is effective June 30, 2008.

6.5 	Sec. 3. Minnesota Statutes 2006, section 11A.18, is amended by adding a subdivision 
6.6 	to read:
6.7 		Subd. 9a.Lost purchasing power increase. (a) This subdivision applies for fiscal 
6.8 	years ending June 30 in which all of the following conditions exist:
6.9 	(1) the composite funded ratio for the postretirement investment fund as of June 30 
6.10 	as certified by the executive director of the State Board of Investment under subdivision 
6.11 	2a is more than 90 percent;
6.12 	(2) the State Board of Investment determines that the time-weighted total rate of 
6.13 	return on investment of assets in the postretirement investment fund for the fiscal year 
6.14 	ending June 30 exceeds 8.5 percent; and
6.15 	(3) the postretirement adjustment percentage certified under subdivision 9, paragraph 
6.16 	(b), is less than 2.5 percent.
6.17 	(b) The lost purchasing power postretirement increase is payable the following 
6.18 	January 1.
6.19 	(c) Each participating public pension plan must annually calculate:
6.20 	(1) the cumulative postretirement adjustment percentage applied to the annuity or 
6.21 	benefit paid to each eligible annuitant and benefit recipient since the person first received a 
6.22 	postretirement adjustment; and
6.23 	(2) the increase in the Consumer Price Index for urban wage earners and clerical 
6.24 	workers all items index published by the Bureau of Labor Statistics of the United 
6.25 	States Department of Labor from June 30 of the year before the person first received a 
6.26 	postretirement adjustment to June 30 of the current year. If a person received a prorated 
6.27 	increase under subdivision 9, paragraph (c), clause (2), the same ratio of the number 
6.28 	of months receiving a monthly benefit to 12 months must be applied to the inflation 
6.29 	calculation for the fiscal year used to calculate the prorated amount of lost purchasing 
6.30 	power for that period.
6.31 	(d) If the percentage in paragraph (c), clause (2), is greater than the percentage in 
6.32 	paragraph (c), clause (1), with respect to an eligible annuitant or benefit recipient, and 
6.33 	the conditions in paragraph (a) exist, that person is eligible to receive an increase under 
6.34 	this subdivision.
7.1 	(e) The percentage increase payable to an eligible annuitant or benefit recipient 
7.2 	under this subdivision may not exceed the difference between 2.5 percent and the amount 
7.3 	certified under subdivision 9 or the amount calculated under paragraph (c), whichever is 
7.4 	lower. The percentage increase otherwise payable under this subdivision must be reduced 
7.5 	as provided in paragraph (f).
7.6 	(f) The actuary retained under section 356.214 must determine:
7.7 	(1) the reserves that would be required to pay in full the adjustments determined 
7.8 	under paragraph (c); and
7.9 	(2) the excess market value necessary to maintain the accrued liability composite 
7.10 	funding ratio determined under subdivision 2a is at least 90 percent. If the calculated 
7.11 	result under clause (1) is greater than the calculated result under this clause, the increase 
7.12 	payable to each eligible annuitant or benefit recipient under this subdivision must be 
7.13 	reduced to that portion of the full potential increase amount that equals the ratio that the 
7.14 	calculated result under this clause bears to the calculated result under clause (1).
7.15 	(g) A percentage increase certified under this subdivision must be added to the 
7.16 	percentage certified under subdivision 9 and the total resulting percentage must be certified 
7.17 	to each participating public pension plan as the full postretirement adjustment percentage.

7.18 	EFFECTIVE DATE. This section is effective June 30, 2008.

7.19 	Sec. 4. Minnesota Statutes 2006, section 11A.18, is amended by adding a subdivision 
7.20 	to read:
7.21 		Subd. 9b.Excess assets trigger. If the composite funded ratio of the postretirement 
7.22 	investment fund determined under subdivision 2a is 115 percent or greater as of June 30 of 
7.23 	any year, the governing bodies of the retirement plans participating in the postretirement 
7.24 	investment fund must jointly report to the Legislative Commission on Pensions and 
7.25 	Retirement by the next January 15. The report must evaluate and make recommendations 
7.26 	with respect to the overall benefits and funding of the retirement funds for both active 
7.27 	employees and benefit recipients.

7.28 	EFFECTIVE DATE. This section is effective June 30, 2008.

7.29 	Sec. 5. Minnesota Statutes 2006, section 356.41, is amended to read:
7.30 	356.41 BENEFIT ADJUSTMENTS FOR CERTAIN DISABILITY AND 
7.31 	SURVIVOR BENEFITS.
7.32 	(a) Disability benefits payable to a disabilitant, if not otherwise included in the 
7.33 	participation in the Minnesota postretirement investment fund, and survivor benefits 
8.1 	payable to a survivor from any public pension plan which participates in the Minnesota 
8.2 	postretirement investment fund must be adjusted in the same manner, at the same times 
8.3 	and in the same amounts as are benefits payable from the Minnesota postretirement 
8.4 	investment fund to comparable eligible benefit recipients of that public pension plan.
8.5 	(b) If a disability benefit is not included in the participation in the Minnesota 
8.6 	postretirement investment fund, the disability benefit is recomputed as a retirement 
8.7 	annuity and the recipient would have been eligible for an adjustment under this section if 
8.8 	the disability benefit was not recomputed, the recipient remains eligible for the adjustment 
8.9 	under this section after the recomputation.
8.10 	(c) For the survivor of a deceased annuitant who receives a survivor benefit 
8.11 	calculated under a prior law rather than the second portion of a joint and survivor 
8.12 	annuity, any period of receipt of a retirement annuity by the annuitant must be utilized in 
8.13 	determining the period of receipt for eligibility to receive an adjustment under this section.
8.14 	(d) No recipient, however, is entitled to more than one adjustment under this section 
8.15 	or section 11A.18 applicable to one benefit at one timeduring a year by reason of this 
8.16 	section.

8.17 	EFFECTIVE DATE. This section is effective June 30, 2008.

8.18 	Sec. 6. Minnesota Statutes 2007 Supplement, section 422A.06, subdivision 8, is 
8.19 	amended to read:
8.20 		Subd. 8.Retirement benefit fund. (a) The retirement benefit fund consists of 
8.21 	amounts held for payment of retirement allowances for members retired under this chapter, 
8.22 	including any transfer amount payable under subdivision 3, paragraph (c).
8.23 	(b) Unless subdivision 3, paragraph (c), applies, assets equal to the required 
8.24 	reserves for retirement allowances under this chapter determined in accordance with the 
8.25 	appropriate mortality table adopted by the board of trustees based on the experience of the 
8.26 	fund as recommended by the actuary retained under section 356.214 must be transferred 
8.27 	from the deposit accumulation fund to the retirement benefit fund as of the last business 
8.28 	day of the month in which the retirement allowance begins. The income from investments 
8.29 	of these assets must be allocated to this fund and any interest charge under subdivision 
8.30 	3, paragraph (c), must be credited to the fund. There must be paid from this fund the 
8.31 	retirement annuities authorized by law. A required reserve calculation for the retirement 
8.32 	benefit fund must be made by the actuary retained under section 356.214 and must be 
8.33 	certified to the retirement board by the actuary retained under section 356.214.
8.34 	(c) The retirement benefit fund must be governed by the applicable laws governing 
8.35 	the accounting and audit procedures, investment, actuarial requirements, calculation and 
9.1 	payment of postretirement benefit adjustments, discharge of any deficiency in the assets 
9.2 	of the fund when compared to the actuarially determined required reserves, and other 
9.3 	applicable operations and procedures regarding the Minnesota postretirement investment 
9.4 	fund in effect on June 30, 1997, established under Minnesota Statutes 1996, section 
9.5 	11A.18, and any legal or administrative interpretations of those laws of the State Board 
9.6 	of Investment, the legal advisor to the Board of Investment and the executive director of 
9.7 	the State Board of Investment in effect on June 30, 1997. If a deferred yield adjustment 
9.8 	account is established for the Minnesota postretirement investment fund before June 30, 
9.9 	1997, under Minnesota Statutes 1996, section 11A.18, subdivision 5, the retirement board 
9.10 	shall also establish and maintain a deferred yield adjustment account within this fund. 
9.11 	(c) There is established a deferred yield adjustment account which must be increased 
9.12 	by the sale or disposition of any debt securities at less than book value and must be 
9.13 	decreased by the sale or disposition of debt securities at more than book value. At the 
9.14 	end of each fiscal year, a portion of the balance of this account must be offset against the 
9.15 	investment income for that year. The annual portion of the balance to be offset must be 
9.16 	proportional to the reciprocal of the average remaining life of the bonds sold, unless the 
9.17 	amounts are offset by gains on the future sales of these securities. The amount of this 
9.18 	account must be included in the recognized value of assets other than corporate stocks 
9.19 	and all other equity investments. In any fiscal year in which the gains on the sales of debt 
9.20 	securities exceed the discounts realized on the sales of such securities, the excess must 
9.21 	be used to reduce the balance of the account. If the realized capital gains are sufficient 
9.22 	to reduce the balance of the account to zero, any excess gains must be available for the 
9.23 	calculation of postretirement adjustments.
9.24 	(d)(1) Annually, following June 30, the board shall use the procedures in clauses (2), 
9.25 	(3), and (4), to determine whether a postretirement adjustment is payable and to determine 
9.26 	the amount of any postretirement adjustment.
9.27 	(2) If the Consumer Price Index for urban wage earners and clerical workers all 
9.28 	items index published by the Bureau of Labor Statistics of the United States Department 
9.29 	of Labor increases from June 30 of the preceding year to June 30 of the current year, the 
9.30 	board shall certify the percentage increase. The amount certified must not exceed the 
9.31 	lesser of the difference between the preretirement interest assumption and postretirement 
9.32 	interest assumption in section 356.215, subdivision 8, paragraph (a), or 3.5 percent.
9.33 	(3) In addition to any percentage increase certified under paragraph (b), the board 
9.34 	shall use the following procedures to determine if a postretirement adjustment is payable 
9.35 	under this paragraph:
9.36 	(i) the board shall determine the market value of the fund on June 30 of that year;
10.1 	(ii) the amount of reserves required as of the current June 30 for the annuity or 
10.2 	benefit payable to an annuitant and benefit recipient must be determined by the actuary 
10.3 	retained under section 356.214. An annuitant or benefit recipient who has been receiving 
10.4 	an annuity or benefit for at least 12 full months as of the current June 30 is eligible to 
10.5 	receive a full postretirement adjustment. An annuitant or benefit recipient who has been 
10.6 	receiving an annuity or benefit for at least one full month, but less than 12 full months as of 
10.7 	the current June 30, is eligible to receive a partial postretirement adjustment. The amount 
10.8 	of the reserves for those annuitants and benefit recipients who are eligible to receive a 
10.9 	full postretirement benefit adjustment is known as "eligible reserves." The amount of 
10.10 	the reserves for those annuitants and benefit recipients who are not eligible to receive a 
10.11 	postretirement adjustment is known as "noneligible reserves." For an annuitant or benefit 
10.12 	recipient who is eligible to receive a partial postretirement adjustment, additional "eligible 
10.13 	reserves" is an amount that bears the same ratio to the total reserves required for the 
10.14 	annuitant or benefit recipient as the number of full months of annuity or benefit receipt as 
10.15 	of the current June 30 bears to 12 full months. The remainder of the annuitant's or benefit 
10.16 	recipient's reserves are "noneligible reserves";
10.17 	(iii) the board shall determine the percentage increase certified under clause (2) 
10.18 	multiplied by the eligible required reserves, as adjusted for mortality gains and losses, 
10.19 	determined under item (ii);
10.20 	(iv) the board shall add the amount of reserves required for the annuities or benefits 
10.21 	payable to annuitants and benefit recipients of the participating public pension plans or 
10.22 	funds as of the current June 30 to the amount determined under item (iii);
10.23 	(v) the board shall subtract the amount determined under item (iv) from the market 
10.24 	value of the fund determined under item (i);
10.25 	(vi) the board shall adjust the amount determined under item (v) by the cumulative 
10.26 	current balance determined under item (viii) and any negative balance carried forward 
10.27 	under item (ix);
10.28 	(vii) a positive amount resulting from the calculations in items (i) to (vi) is the excess 
10.29 	market value. A negative amount is the negative balance;
10.30 	(viii) the board shall allocate one-fifth of the excess market value or one-fifth of the 
10.31 	negative balance to each of five consecutive years, beginning with the fiscal year ending 
10.32 	the current June 30; and
10.33 	(ix) to calculate the postretirement adjustment under this paragraph based on 
10.34 	investment performance for a fiscal year, the board shall add together all excess market 
10.35 	value allocated to that year and subtract from the sum all negative balances allocated to 
10.36 	that year. If this calculation results in a negative number, the entire negative balance must 
11.1 	be carried forward and allocated to the next year. If the resulting amount is positive, a 
11.2 	postretirement adjustment is payable under this paragraph. The board shall express a 
11.3 	positive amount as a percentage of the total eligible required reserves certified to the 
11.4 	board under item (ii).
11.5 	(4) The board shall determine the amount of any postretirement adjustment which 
11.6 	is payable using the following procedure:
11.7 	(i) the total "eligible" required reserves as of the first of January next following the 
11.8 	end of the fiscal year for the annuitants and benefit recipients eligible to receive a full or 
11.9 	partial postretirement adjustment as determined by item (ii) must be certified to the board 
11.10 	by the actuary retained under section 356.214. The total "eligible" required reserves 
11.11 	must be determined by the actuary retained under section 356.214 on the assumption that 
11.12 	all annuitants and benefit recipients eligible to receive a full or partial postretirement 
11.13 	adjustment will be alive on the January 1 in question; and
11.14 	(ii) the board shall add the percentage certified under clause (2) to any positive 
11.15 	percentage calculated under clause (3). The board shall not subtract from the percentage 
11.16 	certified under paragraph (b) any negative amount calculated under clause (3). The sum 
11.17 	of these percentages must be carried to five decimal places and must be certified as the 
11.18 	full postretirement adjustment percentage.
11.19 	(e) The board shall determine the amount of the postretirement adjustment payable 
11.20 	to each eligible annuitant and benefit recipient. The dollar amount of the postretirement 
11.21 	adjustment must be calculated by applying the certified postretirement adjustment 
11.22 	percentage to the amount of the monthly annuity or benefit payable to each eligible 
11.23 	annuitant or benefit recipient eligible for a full adjustment.
11.24 	The dollar amount of the partial postretirement adjustment payable to each annuitant 
11.25 	or benefit recipient eligible for a partial adjustment must be calculated by first determining 
11.26 	a partial percentage amount that bears the same ratio to the certified full adjustment 
11.27 	percentage amount as the number of full months of annuity or benefit receipt as of the 
11.28 	current June 30 bears to 12 full months. The partial percentage amount determined 
11.29 	must then be applied to the amount of the monthly annuity or benefit payable to each 
11.30 	annuitant or benefit recipient eligible to receive a partial postretirement adjustment. The 
11.31 	postretirement adjustments are payable on January 1 following the calculations required 
11.32 	under this section and must thereafter be included in the monthly annuity or benefit paid to 
11.33 	the recipient. Any adjustments under this section must be paid automatically unless the 
11.34 	intended recipient files a written notice with the applicable participating public pension 
11.35 	fund or plan requesting that the adjustment not be paid.
12.1 	(f) As of June 30 annually, the actuary retained under section 356.214 shall calculate 
12.2 	the amount of required reserves representing any mortality gains and any mortality losses 
12.3 	incurred during the fiscal year and report the results of those calculations to the plan. 
12.4 	The actuary shall report separately the amount of the reserves for annuitants and benefit 
12.5 	recipients who are eligible for a postretirement benefit adjustment and the amount of 
12.6 	reserves for annuitants and benefit recipients who are not eligible for a postretirement 
12.7 	benefit adjustment. If the net amount of required reserves represents a mortality gain, 
12.8 	the board shall sell sufficient securities or transfer sufficient available cash to equal the 
12.9 	amount. If the amount of required reserves represents a mortality loss, the plan shall 
12.10 	transfer an amount equal to the amount of the net mortality loss. The amount of the 
12.11 	transfers must be determined before any postretirement benefit adjustments have been 
12.12 	made. All transfers resulting from mortality adjustments must be completed annually 
12.13 	by December 31 for the preceding June 30. Interest is payable on any transfers after 
12.14 	December 31 based upon the preretirement interest assumption for the participating plan 
12.15 	or fund as specified in section 356.215, subdivision 8, stated as a monthly rate. Book 
12.16 	values of the assets of the fund must be determined only after all adjustments for mortality 
12.17 	gains and losses for the fiscal year have been made.
12.18 	(g) All money necessary to meet the requirements of the certification of withdrawals 
12.19 	and all money necessary to pay postretirement adjustments under this section are hereby 
12.20 	and from time to time appropriated from the postretirement investment fund to the board.
12.21 	(d)(h) Annually, following the calculation of any postretirement adjustment 
12.22 	payable from the retirement benefit fund, the board of trustees shall submit a report to 
12.23 	the executive director of the Legislative Commission on Pensions and Retirement and 
12.24 	to the commissioner of finance indicating the amount of any postretirement adjustment 
12.25 	and the underlying calculations on which that postretirement adjustment amount is based, 
12.26 	including the amount of dividends, the amount of interest, and the amount of net realized 
12.27 	capital gains or losses utilized in the calculations.
12.28 	(e)(i) With respect to a former contributing member who began receiving a 
12.29 	retirement annuity or disability benefit under section 422A.151, paragraph (a), clause (2), 
12.30 	after June 30, 1997, or with respect to a survivor of a former contributing member who 
12.31 	began receiving a survivor benefit under section 422A.151, paragraph (a), clause (2), 
12.32 	after June 30, 1997, the reserves attributable to the one percent lower amount of the 
12.33 	cost-of-living adjustment payable to those annuity or benefit recipients annually must 
12.34 	be transferred back to the deposit accumulation fund to the credit of the Metropolitan 
12.35 	Airports Commission. The calculation of this annual reduced cost-of-living adjustment 
12.36 	reserve transfer must be reviewed by the actuary retained under section 356.214.

13.1 	EFFECTIVE DATE. This section is effective June 30, 2008.

13.2 	ARTICLE 2
13.3 	MINNESOTA POSTRETIREMENT INVESTMENT FUND DISSOLUTION

13.4 	Section 1. [11A.181] DISSOLUTION OF MINNESOTA POSTRETIREMENT 
13.5 	INVESTMENT FUND.
13.6 		Subdivision 1.Conditions for dissolution. The postretirement investment fund 
13.7 	established in section 11A.18 must be dissolved according to the schedule in subdivision 2 
13.8 	if the composite funded ratio calculated as of June 30 of that year under section 11A.18, 
13.9 	subdivision 2a, is:
13.10 	(1) less than 85 percent and was less than 85 percent as of June 30 of the immediately 
13.11 	preceding year; or
13.12 	(2) less than 80 percent.
13.13 		Subd. 2.Transition. If conditions for dissolution of the postretirement investment 
13.14 	fund under subdivision 1 apply:
13.15 	(1) the retirement plans shall not transfer reserves as required under sections 11A.18, 
13.16 	subdivision 6; 352.119, subdivision 2; 352B.26, subdivision 3; 353.271, subdivision 2; 
13.17 	354.63, subdivision 2; and 490.123, subdivision 1e, to the postretirement investment 
13.18 	fund after December 31 of the calendar year in which conditions for dissolution under 
13.19 	subdivision 1 occur;
13.20 	(2) the retirement plans shall not transfer additional funds to the Minnesota 
13.21 	postretirement investment fund as a result of the calculation by the actuary retained under 
13.22 	section 356.214 of net mortality losses under section 11A.18, subdivision 11;
13.23 	(3) the assets of the postretirement investment fund must be transferred back to each 
13.24 	participating public retirement plan on June 30 of the year following the year in which 
13.25 	conditions for dissolution under subdivision 1 occur. The assets to be transferred to each 
13.26 	public retirement plan must be based on each plan's participation in the postretirement 
13.27 	fund as determined under section 11A.18, subdivision 7, on the June 30 when the transfer 
13.28 	back to the plan occurs; and
13.29 	(4) the postretirement investment fund ceases to exist upon the transfer of all assets 
13.30 	as required in clause (3).
13.31 		Subd. 3.Postretirement adjustments. (a) Notwithstanding section 11A.18 or any 
13.32 	other law to the contrary, if the postretirement investment fund is dissolved, postretirement 
13.33 	adjustments are payable only as follows:
13.34 	(1) a postretirement increase of 2.5 percent must be applied each year, effective 
13.35 	January 1, to the monthly annuity or benefit of each annuitant and benefit recipient who 
14.1 	has been receiving an annuity or a benefit for at least 12 full months as of the prior 
14.2 	January 1; and
14.3 	(2) for each annuitant or benefit recipient who has been receiving an annuity or a 
14.4 	benefit for at least one full month, an annual postretirement increase of 1/12 of 2.5 percent 
14.5 	for each month the person has been receiving an annuity or benefit must be applied, 
14.6 	effective January 1 of the year in which the person has been retired for less than 12 months.
14.7 	(b) The increases provided by this subdivision commence on the first January 1 
14.8 	occurring after the postretirement fund is dissolved under subdivision 2.

14.9 	EFFECTIVE DATE. This section is effective June 30, 2008.

14.10 	Sec. 2. PROPOSED STATUTORY CHANGES.
 14.11 	By November 30 of the year in which conditions for dissolution of the postretirement 
14.12 	investment fund first occur, the executive directors of the retirement systems that 
14.13 	participate in the postretirement investment fund must report to the Legislative 
14.14 	Commission on Pensions and Retirement a draft of proposed legislation that would make 
14.15 	changes in statute necessary to conform with dissolution of the postretirement investment 
14.16 	fund.

14.17 	EFFECTIVE DATE. This section is effective June 30, 2008.

14.18 	ARTICLE 3
14.19 	PHASED RETIREMENT OR
14.20 	RETURN TO EMPLOYMENT PROVISIONS

14.21 	Section 1. Minnesota Statutes 2007 Supplement, section 43A.346, subdivision 1, 
14.22 	is amended to read:
14.23 		Subdivision 1.Definition. For purposes of this section, "terminated state employee" 
14.24 	means a person currently occupyingwho occupied a civil service position in the executive 
14.25 	or legislative branch of state government, the Minnesota State Retirement System, the 
14.26 	Public Employees Retirement Association, or the Office of the Legislative Auditor, or a 
14.27 	person who was employed by the Metropolitan Council.

14.28 	EFFECTIVE DATE. This section is effective July 1, 2008.

14.29 	Sec. 2. Minnesota Statutes 2007 Supplement, section 43A.346, subdivision 2, is 
14.30 	amended to read:
15.1 		Subd. 2.Eligibility. (a) This section applies to a terminated state or Metropolitan 
15.2 	Council employee who:
15.3 	(1) for at least the five years immediately preceding separation under clause (2), has 
15.4 	beenwas regularly scheduled to work 1,044 or more hours per year in a position covered 
15.5 	by a pension plan administered by the Minnesota State Retirement System or the Public 
15.6 	Employees Retirement Association;
15.7 	(2) terminatesterminated state or Metropolitan Council employment;
15.8 	(3) at the time of termination under clause (2), meetsmet the age and service 
15.9 	requirements necessary to receive an unreduced retirement annuity from the plan and 
15.10 	satisfiessatisfied requirements for the commencement of the retirement annuity or, for 
15.11 	ana terminated employee under the unclassified employees retirement plan, meetsmet 
15.12 	the age and service requirements necessary to receive an unreduced retirement annuity 
15.13 	from the plan and satisfiessatisfied requirements for the commencement of the retirement 
15.14 	annuity or electselected a lump-sum payment; and
15.15 	(4) agrees to accept a postretirement option position with the same or a different 
15.16 	appointing authority, working a reduced schedule that is both (i) a reduction of at least 25 
15.17 	percent from the employee's number of previously regularly scheduled work hours; and 
15.18 	(ii) 1,044 hours or less in state or Metropolitan Council service.
15.19 	(b) For purposes of this section, an unreduced retirement annuity includes a 
15.20 	retirement annuity computed under a provision of law which permits retirement, without 
15.21 	application of an earlier retirement reduction factor, whenever age plus years of allowable 
15.22 	service total at least 90.
15.23 	(c) For purposes of this section, as it applies to staff of the Public Employees 
15.24 	Retirement Association who are at least age 62, the length of separation requirement and 
15.25 	termination of service requirement prohibiting return to work agreements under section 
15.26 	353.01, subdivisions 11a and 28, are not applicable.

15.27 	EFFECTIVE DATE. This section is effective July 1, 2008.

15.28 	Sec. 3. Minnesota Statutes 2006, section 43A.346, subdivision 4, is amended to read:
15.29 		Subd. 4.Annuity reduction not applicable. Notwithstanding any law to the 
15.30 	contrary, when an eligible state employee in a postretirement option position under this 
15.31 	section commences receipt of the annuity, the provisions of section 352.115, subdivision 
15.32 	10, or 353.37 governing annuities of reemployed annuitants, shall not apply for the 
15.33 	duration of a terminated state employee's employment in thea postretirement option 
15.34 	position.

16.1 	EFFECTIVE DATE. This section is effective July 1, 2008.

16.2 	Sec. 4. Minnesota Statutes 2006, section 43A.346, subdivision 5, is amended to read:
16.3 		Subd. 5.Appointing authority discretion. The appointing authority has sole 
16.4 	discretion to determine if and the extent to which a postretirement option position under 
16.5 	this section is available to a terminated state employee. Any offer of such a position 
16.6 	must be made in writing to the employeeperson by the appointing authority on a form 
16.7 	prescribed by the Department of Employee Relations and the Minnesota State Retirement 
16.8 	System or the Public Employees Retirement Association. If the person is under age 62, an 
16.9 	offer of a postretirement option position and any related verbal offer or agreement must 
16.10 	not be made until at least 30 days after the person terminated employment. The appointing 
16.11 	authority may not require a person to waive any rights under a collective bargaining 
16.12 	agreement or unrepresented employee compensation plan as a condition of participation.

16.13 	EFFECTIVE DATE. This section is effective July 1, 2008.

16.14 	Sec. 5. Minnesota Statutes 2006, section 43A.346, subdivision 6, is amended to read:
16.15 		Subd. 6.Duration. Postretirement option employment shall be for an initial 
16.16 	period not to exceed one year. During that period, the appointing authority may not 
16.17 	modify the conditions specified in the written offer without the employee's agreement
16.18 	person's consent, except as required by law or by the collective bargaining agreement or 
16.19 	compensation plan applicable to the employee person. At the end of the initial period, 
16.20 	the appointing authority has sole discretion to determine if the offer of a postretirement 
16.21 	option position will be renewed, renewed with modifications, or terminated. If the person 
16.22 	is under age 62, an offer of renewal and any related verbal offer or agreement must not 
16.23 	be made until at least 30 days after termination of the person's previous postretirement 
16.24 	option employment. Postretirement option employment may be renewed for periods of 
16.25 	up to one year, not to exceed a total duration of five years. No person shall be employed 
16.26 	in one or a combination of postretirement option positions under this section for a total 
16.27 	of more than five years.

16.28 	EFFECTIVE DATE. This section is effective July 1, 2008.

16.29 	Sec. 6. Minnesota Statutes 2006, section 43A.346, subdivision 7, is amended to read:
16.30 		Subd. 7.Copy to fund. The appointing authority shall provide the Minnesota 
16.31 	State Retirement System or the Public Employees Retirement Association with a copy of 
17.1 	the offer, the terminated state employee's acceptance of the terms, and any subsequent 
17.2 	renewal agreement.

17.3 	EFFECTIVE DATE. This section is effective July 1, 2008.

17.4 	Sec. 7. Minnesota Statutes 2006, section 354.05, subdivision 37, is amended to read:
17.5 		Subd. 37.Termination of teaching service. "Termination of teaching service" 
17.6 	means the withdrawal of a member from active teaching service by resignation or the 
17.7 	termination of the member's teaching contract by the employer. A member is not 
17.8 	considered to have terminated teaching service, if before the age of 62, and before the 
17.9 	effective date of the termination or retirement, the member has entered into a contract to 
17.10 	resume teaching service with an employing unit covered by the provisions of this chapter. 
17.11 	A contract to return to work after retirement for an active member who has attained age 
17.12 	62 must comply with the provisions of section 354.444.

17.13 	EFFECTIVE DATE. This section is effective July 1, 2008.

17.14 	Sec. 8. Minnesota Statutes 2006, section 354.44, subdivision 5, is amended to read:
17.15 		Subd. 5.Resumption of teaching service after retirement. (a) Any person who 
17.16 	retired under the provisions of this chapter and has thereafter resumed teaching in any 
17.17 	employer unit to which this chapter applies is eligible to continue to receive payments in 
17.18 	accordance with the annuity except that all or a portion of the annuity payments must be 
17.19 	reduceddeferred during the calendar year immediately following any calendar year in 
17.20 	which the person's incomesalary from the teaching service is in an amount greater than the 
17.21 	annual maximum earnings allowable for that age for the continued receipt of full benefit 
17.22 	amounts monthly under the federal old age, survivors and disability insurance program 
17.23 	as set by the secretary of health and human services under United States Code, title 42, 
17.24 	section 403 $46,000. The amount of the reduction must beannuity deferral is one-half of 
17.25 	the salary amount in excess of the applicable reemployment income maximum specified in 
17.26 	this subdivision$46,000 and must be deducted from the annuity payable for the calendar 
17.27 	year immediately following the calendar year in which the excess amount was earned. If 
17.28 	the person has not yet reached the minimum age for the receipt of Social Security benefits, 
17.29 	the maximum earnings for the person must be equal to the annual maximum earnings 
17.30 	allowable for the minimum age for the receipt of Social Security benefits.
17.31 	(b) If the person is retired for only a fractional part of the calendar year during 
17.32 	the initial year of retirement, the maximum reemployment incomesalary exempt from 
17.33 	triggering a deferral as specified in this subdivision must be prorated for that calendar year.
18.1 	(c) After a person has reached the Social Security fullnormal retirement age, no 
18.2 	reemployment income maximumdeferral requirement is applicable regardless of the 
18.3 	amount of income salary.
18.4 	(d) The amount of the retirement annuity reductiondeferral must be handled or 
18.5 	disposed of as provided in section  356.47. 
18.6 	(e) For the purpose of this subdivision, incomesalary from teaching service includes, 
18.7 	but is not limited to:
18.8 	(1) all income for services performed as a consultant or an independent contractor 
18.9 	for an employer unit covered by the provisions of this chapter; and
18.10 	(2) the greater of either the income received or an amount based on the rate paid 
18.11 	with respect to an administrative position, consultant, or independent contractor in an 
18.12 	employer unit with approximately the same number of pupils and at the same level as the 
18.13 	position occupied by the person who resumes teaching service.

18.14 	EFFECTIVE DATE. This section is effective January 1, 2008.

18.15 	Sec. 9. [354.444] RETURN TO WORK AGREEMENT.
18.16 		Subdivision 1.Authorization. Notwithstanding any other provisions in this chapter, 
18.17 	an eligible person as specified in subdivision 2 is authorized to commence receipt of a 
18.18 	retirement annuity from the association and enter into an agreement to return to work. 
18.19 	This provision must be administered in accordance with the federal Internal Revenue 
18.20 	Code and applicable rulings.
18.21 		Subd. 2.Eligibility. An eligible person is a person who:
18.22 	(1) is a teacher as defined by section 354.05, subdivision 2, who is at least age 62;
18.23 	(2) enters into a written agreement with the employing unit to return to work; and
18.24 	(3) retires under the provisions of section 354.44 and begins to draw an annuity 
18.25 	from the Teachers Retirement Association.
18.26 		Subd. 3.Work agreement. Participation, the amount of time worked, and 
18.27 	the duration of participation under this section must be mutually agreed upon by the 
18.28 	employing unit and the employee. The employing unit may require up to a one-year notice 
18.29 	of intent to participate in the program as a condition of participation. The employing unit 
18.30 	shall determine the time of year the employee shall work. Unless otherwise specified in 
18.31 	this section, the employing unit may not require a person to waive any rights under a 
18.32 	collective bargaining agreement as a condition of participation under this section.
18.33 		Subd. 4.Exclusion. For purposes of this section, "employing unit" does not include 
18.34 	the Minnesota State Colleges and Universities system.
19.1 		Subd. 5.No service credit or contribution. Notwithstanding any law to the 
19.2 	contrary, an eligible person under this section may not, based on employment to which 
19.3 	this section applies, contribute to or earn further service credit in the Teachers Retirement 
19.4 	Association.
19.5 		Subd. 6.Annuity application procedure. A participant in the program specified in 
19.6 	this section must apply for a retirement annuity under the application procedure specified 
19.7 	in section 354.44, subdivisions 3 and 4. A copy of the written agreement with the 
19.8 	employing unit must be included with the person's retirement annuity application. This 
19.9 	written agreement must include the termination date and reemployment date. The filing 
19.10 	of the initial executed agreement must occur before reemployment under the agreement 
19.11 	commences. The reemployment date must be after the member's accrual date.
19.12 		Subd. 7.Annuity treatment. For purposes of the annuity deferral under section 
19.13 	354.44, subdivision 5, an eligible person under this section is a reemployed annuitant.
19.14 		Subd. 8.Continuing rights. A person who returns to work under this section is a 
19.15 	member of the appropriate bargaining unit and is covered by the appropriate collective 
19.16 	bargaining contract. Except as provided in this section, the person's coverage is subject to 
19.17 	any part of the contract limiting rights of part-time employees.

19.18 	EFFECTIVE DATE. This section is effective July 1, 2008.

19.19 	Sec. 10. Minnesota Statutes 2006, section 354A.31, subdivision 3, is amended to read:
19.20 		Subd. 3.Resumption of teaching after commencement of a retirement annuity.
 19.21 	(a) Any person who retired and is receiving a coordinated program retirement annuity 
19.22 	under the provisions of sections 354A.31 to 354A.41 or any person receiving a basic 
19.23 	program retirement annuity under the governing sections in the articles of incorporation 
19.24 	or bylaws and who has resumed teaching service for the school district in which the 
19.25 	teachers retirement fund association exists is entitled to continue to receive retirement 
19.26 	annuity payments, except that all or a portion of the annuity payments must be reduced
19.27 	deferred during the calendar year immediately following the calendar year in which the 
19.28 	person's incomesalary from the teaching service is in an amount greater than the annual 
19.29 	maximum earnings allowable for that age for the continued receipt of full benefit amounts 
19.30 	monthly under the federal old age, survivors, and disability insurance program as set by 
19.31 	the secretary of health and human services under United States Code, title 42, section 403
19.32 	$46,000. The amount of the reduction must beannuity deferral is one-third the salary 
19.33 	amount in excess of the applicable reemployment income maximum specified in this 
19.34 	subdivision$46,000 and must be deducted from the annuity payable for the calendar year 
19.35 	immediately following the calendar year in which the excess amount was earned. If the 
20.1 	person has not yet reached the minimum age for the receipt of Social Security benefits, 
20.2 	the maximum earnings for the person must be equal to the annual maximum earnings 
20.3 	allowable for the minimum age for the receipt of Social Security benefits.
20.4 	(b) If the person is retired for only a fractional part of the calendar year during 
20.5 	the initial year of retirement, the maximum reemployment incomesalary exempt from 
20.6 	triggering a deferral as specified in this subdivision must be prorated for that calendar year.
20.7 	(c) After a person has reached the Social Security normal retirement age of 70, no 
20.8 	reemployment income maximumdeferral requirement is applicable regardless of the 
20.9 	amount of any compensation received for teaching service for the school district in which 
20.10 	the teachers retirement fund association exists.
20.11 	(d) The amount of the retirement annuity reductiondeferral must be handled or 
20.12 	disposed of as provided in section 356.47. 
20.13 	(e) For the purpose of this subdivision, incomesalary from teaching service 
20.14 	includes: (i) all income for services performed as a consultant or independent contractor; 
20.15 	or income resulting from working with the school district in any capacity; and (ii) the 
20.16 	greater of either the income received or an amount based on the rate paid with respect to 
20.17 	an administrative position, consultant, or independent contractor in the school district in 
20.18 	which the teachers retirement fund association exists and at the same level as the position 
20.19 	occupied by the person who resumes teaching service.
20.20 	(f) On or before February 15 of each year, each applicable employing unit shall 
20.21 	report to the teachers retirement fund association the amount of postretirement income
20.22 	salary as defined in this subdivision, earned as a teacher, consultant, or independent 
20.23 	contractor during the previous calendar year by each retiree of the teachers retirement 
20.24 	fund association for teaching service performed after retirement. The report must be in 
20.25 	a format approved by the executive secretary or director.

20.26 	EFFECTIVE DATE. This section is effective January 1, 2008.

20.27 	Sec. 11. PERA POLICE AND FIRE; TEMPORARY EXEMPTION FROM 
20.28 	REEMPLOYED ANNUITANT EARNINGS LIMITATIONS.
 20.29 	Notwithstanding any provision of Minnesota Statutes, section 353.37, to the 
20.30 	contrary, a person who is receiving a retirement annuity from the public employees 
20.31 	police and fire plan and who is employed as a sworn peace officer by the Metropolitan 
20.32 	Airports Commission is exempt from the limitation on reemployed annuitant exempt 
20.33 	earnings under Minnesota Statutes, section 353.37, for the period January 1, 2008, until 
20.34 	December 31, 2009.

21.1 	EFFECTIVE DATE. This section is effective the day following final enactment.

21.2 	Sec. 12. BYLAW REVISION AUTHORIZATION.
 21.3 	Consistent with Minnesota Statutes, sections 354A.12, subdivisions 3 and 4, and 
21.4 	354A.31, subdivision 3, the St. Paul Teachers Retirement Fund Association and the 
21.5 	Duluth Teachers Retirement Fund Association are authorized to revise their bylaws or 
21.6 	articles of incorporation to specify that a person receiving a basic program retirement 
21.7 	annuity or an old law coordinated program annuity under the governing sections in the 
21.8 	articles of incorporation or bylaws who has resumed teaching service for the school 
21.9 	district is entitled to continue receiving retirement annuity payments, except that all or a 
21.10 	portion of the annuity payments must be deferred during the calendar year immediately 
21.11 	following the calendar year in which the person's salary from the reemployment exceeds 
21.12 	$46,000. The amount of the annuity deferral is one-third of the salary amount in excess of 
21.13 	$46,000. After a person has reached Social Security normal retirement age, the deferral 
21.14 	requirement no longer applies. Any deferral amounts must be treated as specified in 
21.15 	Minnesota Statutes, section 356.47.

21.16 	EFFECTIVE DATE. This section is effective July 1, 2008.

21.17 	ARTICLE 4
21.18 	MANDATORY JOINT AND SURVIVOR BENEFIT FORM

21.19 	Section 1. Minnesota Statutes 2006, section 352.12, subdivision 2, is amended to read:
21.20 		Subd. 2.Surviving spouse benefit. (a) If an employee or former employee has 
21.21 	credit for at least three years allowable service and dies before an annuity or disability 
21.22 	benefit has become payable, notwithstanding any designation of beneficiary to the contrary, 
21.23 	the surviving spouse of the employee may elect to receive, in lieu of the refund with 
21.24 	interest under subdivision 1, an annuity equal to the joint and 100 percent survivor annuity 
21.25 	which the employee or former employee could have qualified for on the date of death.
21.26 	(b) If the employee was under age 55 and has credit for at least 30 years of allowable 
21.27 	service on the date of death, the surviving spouse may elect to receive a 100 percent joint 
21.28 	and survivor annuity based on the age of the employee and surviving spouse on the date 
21.29 	of death. The annuity is payable using the full early retirement reduction under section 
21.30 	352.116, subdivision 1, paragraph (a), to age 55 and one-half of the early retirement 
21.31 	reduction from age 55 to the age payment begins. 
21.32 	(c) If the employee was under age 55 and has credit for at least three years of 
21.33 	allowable service credit on the date of death but did not yet qualify for retirement, the 
22.1 	surviving spouse may elect to receive a 100 percent joint and survivor annuity based on 
22.2 	the age of the employee and surviving spouse at the time of death. The annuity is payable 
22.3 	using the full early retirement reduction under section 352.116, subdivision 1 or 1a, to age 
22.4 	55 and one-half of the early retirement reduction from age 55 to the age payment begins. 
22.5 	(d) The surviving spouse eligible for benefits under paragraph (a) may apply for the 
22.6 	annuity at any time after the date on which the employee or former employee would 
22.7 	have attained the required age for retirement based on the allowable service earned. 
22.8 	The surviving spouse eligible for surviving spouse benefits under paragraph (b) or (c) 
22.9 	may apply for the annuity at any time after the employee's death. The annuity must be 
22.10 	computed under sections 352.115, subdivisions 1, 2, and 3, and 352.116, subdivisions 1, 
22.11 	1a, and 3. Sections 352.22, subdivision 3, and 352.72, subdivision 2, apply to a deferred 
22.12 	annuity or surviving spouse benefit payable under this subdivision. The annuity must cease 
22.13 	with the last payment received by the surviving spouse in the lifetime of the surviving 
22.14 	spouse, or upon expiration of a term certain benefit payment to a surviving spouse under 
22.15 	subdivision 2a. An amount equal to the excess, if any, of the accumulated contributions 
22.16 	credited to the account of the deceased employee in excess of the total of the benefits paid 
22.17 	and payable to the surviving spouse must be paid to the deceased employee's or former 
22.18 	employee's last designated beneficiary or, if none, as specified under subdivision 1. 
22.19 	(e) Any employee or former employee may request in writing, with the signed 
22.20 	consent of the spouse, that this subdivision not apply and that payment be made only to a 
22.21 	designated beneficiary as otherwise provided by this chapter.

22.22 	EFFECTIVE DATE. This section is effective the day following final enactment.

22.23 	Sec. 2. Minnesota Statutes 2006, section 352.931, subdivision 1, is amended to read:
22.24 		Subdivision 1.Surviving spouse benefit. (a) If the correctional employee was at 
22.25 	least age 50, has credit for at least three years of allowable service, and dies before an 
22.26 	annuity or disability benefit has become payable, notwithstanding any designation of 
22.27 	beneficiary to the contrary, the surviving spouse of the employee may elect to receive, 
22.28 	in lieu of the refund under section 352.12, subdivision 1, an annuity for life equal to the 
22.29 	joint and 100 percent survivor annuity which the employee could have qualified for had 
22.30 	the employee terminated service on the date of death. The election may be made at any 
22.31 	time after the date of death of the employee. The surviving spouse benefit begins to 
22.32 	accrue as of the first of the month next following the date on which the application for 
22.33 	the benefit was filed. 
22.34 	(b) If the employee was under age 50, dies, and had credit for at least three years of 
22.35 	allowable service credit on the date of death but did not yet qualify for retirement, the 
23.1 	surviving spouse may elect to receive a 100 percent joint and survivor annuity based on 
23.2 	the age of the employee and surviving spouse at the time of death. The annuity is payable 
23.3 	using the early retirement reduction under section 352.93, subdivision 2a, to age 50, and 
23.4 	one-half of the early retirement reduction from age 50 to the age payment begins. The 
23.5 	surviving spouse eligible for surviving spouse benefits under this paragraph may apply 
23.6 	for the annuity at any time after the employee's death. Sections 352.22, subdivision 3, 
23.7 	and 352.72, subdivision 2, apply to a deferred annuity or surviving spouse benefit payable 
23.8 	under this subdivision. 
23.9 	(c) The annuity must cease with the last payment received by the surviving spouse 
23.10 	in the lifetime of the surviving spouse. Any employee may request in writing, with the 
23.11 	signed consent of the spouse, that this subdivision not apply and that payment be made 
23.12 	only to a designated beneficiary as otherwise provided by this chapter.

23.13 	EFFECTIVE DATE. This section is effective the day following final enactment.

23.14 	Sec. 3. Minnesota Statutes 2006, section 353.30, subdivision 3, is amended to read:
23.15 		Subd. 3.Optional retirement annuity forms. The board of trustees shall establish 
23.16 	optional annuities which shall take the form of a joint and survivor annuity. Except as 
23.17 	provided in subdivision 3a, the optional annuity forms shall be actuarially equivalent to 
23.18 	the forms provided in section 353.29 and subdivisions 1, 1a, 1b, 1c, and 5. In establishing 
23.19 	those optional forms, the board shall obtain the written recommendation of the actuary 
23.20 	retained under section 356.214. The recommendations shall be a part of the permanent 
23.21 	records of the board. A member or former member may select an optional form of 
23.22 	annuity, subject to the provisions of section 356.46, in lieu of accepting any other form of 
23.23 	annuity which might otherwise be available. 

23.24 	EFFECTIVE DATE. This section is effective January 1, 2009.

23.25 	Sec. 4. Minnesota Statutes 2007 Supplement, section 353.32, subdivision 1a, is 
23.26 	amended to read:
23.27 		Subd. 1a.Surviving spouse optional annuity. (a) If a member or former member 
23.28 	who has credit for not less than three years of allowable service and dies before the 
23.29 	annuity or disability benefit begins to accrue under section 353.29, subdivision 7, or 
23.30 	353.33, subdivision 2, notwithstanding any designation of beneficiary to the contrary, the 
23.31 	surviving spouse may elect to receive, instead of a refund with interest under subdivision 
23.32 	1, or surviving spouse benefits otherwise payable under section 353.31, an annuity equal 
24.1 	to a 100 percent joint and survivor annuity computed consistent with section 353.30, 
24.2 	subdivision 1a, 1c, or 5, whichever is applicable. 
24.3 	(b) If a member first became a public employee or a member of a pension fund listed 
24.4 	in section 356.30, subdivision 3, before July 1, 1989, and has credit for at least 30 years 
24.5 	of allowable service on the date of death, the surviving spouse may elect to receive a 
24.6 	100 percent joint and survivor annuity computed using section 353.30, subdivision 1b, 
24.7 	except that the early retirement reduction under that provision will be applied from age 
24.8 	62 back to age 55 and one-half of the early retirement reduction from age 55 back to 
24.9 	the age payment begins. 
24.10 	(c) If a member who was under age 55 and has credit for at least three years 
24.11 	of allowable service dies, but did not qualify for retirement on the date of death, the 
24.12 	surviving spouse may elect to receive a 100 percent joint and survivor annuity computed 
24.13 	using section 353.30, subdivision 1c or 5, as applicable, except that the early retirement 
24.14 	reduction specified in the applicable subdivision will be applied to age 55 and one-half of 
24.15 	the early retirement reduction from age 55 back to the age payment begins. 
24.16 	(d) Notwithstanding the definition of surviving spouse in section 353.01, subdivision 
24.17 	20, a former spouse of the member, if any, is entitled to a portion of the monthly surviving 
24.18 	spouse optional annuity if stipulated under the terms of a marriage dissolution decree filed 
24.19 	with the association. If there is no surviving spouse or child or children, a former spouse 
24.20 	may be entitled to a lump-sum refund payment under subdivision 1, if provided for in a 
24.21 	marriage dissolution decree, but not a monthly surviving spouse optional annuity, despite 
24.22 	the terms of a marriage dissolution decree filed with the association. 
24.23 	(e) The surviving spouse eligible for surviving spouse benefits under paragraph (a) 
24.24 	may apply for the annuity at any time after the date on which the deceased employee 
24.25 	would have attained the required age for retirement based on the employee's allowable 
24.26 	service. The surviving spouse eligible for surviving spouse benefits under paragraph (b) or 
24.27 	(c) may apply for an annuity any time after the member's death. 
24.28 	(f) Sections 353.34, subdivision 3, and 353.71, subdivision 2, apply to a deferred 
24.29 	annuity or surviving spouse benefit payable under this subdivision. 
24.30 	(g) An amount equal to any excess of the accumulated contributions that were 
24.31 	credited to the account of the deceased employee over and above the total of the annuities 
24.32 	paid and payable to the surviving spouse must be paid to the surviving spouse's estate. 
24.33 	(h) A member may specify in writing, with the signed consent of the spouse, that 
24.34 	this subdivision does not apply and that payment may be made only to the designated 
24.35 	beneficiary as otherwise provided by this chapter. The waiver of a surviving spouse 
25.1 	annuity under this section does not make a dependent child eligible for benefits under 
25.2 	subdivision 1c. 
25.3 	(i) If the deceased member or former member first became a public employee or a 
25.4 	member of a public pension plan listed in section 356.30, subdivision 3, on or after July 
25.5 	1, 1989, a survivor annuity computed under paragraph (a) or (c) must be computed as 
25.6 	specified in section 353.30, subdivision 5, except for the revised early retirement reduction 
25.7 	specified in paragraph (c), if paragraph (c) is the applicable provision.
25.8 	(j) For any survivor annuity determined under this subdivision, the payment is to be 
25.9 	based on the total allowable service that the member had accrued as of the date of death 
25.10 	and the age of the member and surviving spouse on that date.

25.11 	EFFECTIVE DATE. This section is effective the day following final enactment.

25.12 	Sec. 5. Minnesota Statutes 2007 Supplement, section 353.657, subdivision 2a, is 
25.13 	amended to read:
25.14 		Subd. 2a.Death while eligible survivor benefit. (a) If a member or former 
25.15 	member who has attained the age of at least 50 years and has credit for not less than 
25.16 	three years allowable service or who has credit for at least 30 years of allowable service, 
25.17 	regardless of age attained, dies before the annuity or disability benefit becomes payable, 
25.18 	notwithstanding any designation of beneficiary to the contrary, the surviving spouse may 
25.19 	elect to receive a death while eligible survivor benefit.
25.20 	(b) Notwithstanding the definition of surviving spouse in section 353.01, subdivision 
25.21 	20, a former spouse of the member, if any, is entitled to a portion of the death while 
25.22 	eligible survivor benefit if stipulated under the terms of a marriage dissolution decree 
25.23 	filed with the association. If there is no surviving spouse or child or children, a former 
25.24 	spouse may be entitled to a lump-sum refund payment under section 353.32, subdivision 
25.25 	1, if provided for in a marriage dissolution decree but not a death while eligible survivor 
25.26 	benefit despite the terms of a marriage dissolution decree filed with the association. 
25.27 	(c) The benefit may be elected instead of a refund with interest under section 353.32, 
25.28 	subdivision 1, or surviving spouse benefits otherwise payable under subdivisions 1 and 
25.29 	2. The benefit must be an annuity equal to the 100 percent joint and survivor annuity 
25.30 	which the member could have qualified for on the date of death, computed as provided in 
25.31 	sections 353.651, subdivisions 2 and 3, and 353.30, subdivision 3. 
25.32 	(d) The surviving spouse may apply for the annuity at any time after the date 
25.33 	on which the deceased employee would have attained the required age for retirement 
25.34 	based on the employee's allowable service. Sections 353.34, subdivision 3, and 353.71, 
25.35 	subdivision 2, apply to a deferred annuity payable under this subdivision.
26.1 	(e) No payment accrues beyond the end of the month in which entitlement to 
26.2 	such annuity has terminated. An amount equal to the excess, if any, of the accumulated 
26.3 	contributions which were credited to the account of the deceased employee over and 
26.4 	above the total of the annuities paid and payable to the surviving spouse must be paid to 
26.5 	the deceased member's last designated beneficiary or, if none, to the legal representative of 
26.6 	the estate of such deceased member.
26.7 	(f) Any member may request in writing, with the signed consent of the spouse, that 
26.8 	this subdivision not apply and that payment be made only to the designated beneficiary, as 
26.9 	otherwise provided by this chapter.
26.10 	(g) For a member who is employed as a full-time firefighter by the Department of 
26.11 	Military Affairs of the state of Minnesota, allowable service as a full-time state Military 
26.12 	Affairs Department firefighter credited by the Minnesota State Retirement System may be 
26.13 	used in meeting the minimum allowable service requirement of this subdivision.

26.14 	EFFECTIVE DATE. This section is effective the day following final enactment.

26.15 	Sec. 6. Minnesota Statutes 2006, section 353E.07, subdivision 7, is amended to read:
26.16 		Subd. 7.Election that section does not apply. A member may specify in writing, 
26.17 	with the signed consent of the spouse, that this section does not apply and that payment 
26.18 	must be made only to the designated beneficiary, as otherwise provided by this chapter.

26.19 	EFFECTIVE DATE. This section is effective the day following final enactment.

26.20 	Sec. 7. Minnesota Statutes 2006, section 356.46, as amended by Laws 2007, chapter 
26.21 	134, article 2, section 44, is amended to read:
26.22 	356.46 APPLICATION FOR RETIREMENT ANNUITY; PROCEDURE 
26.23 	FOR ELECTING ANNUITY FORM; MANDATORY JOINT AND SURVIVOR 
26.24 	OPTIONAL ANNUITY FORM.
26.25 		Subdivision 1.Definitions. As used in this section, each of the following terms shall 
26.26 	have the meaning given.
26.27 	(a) "Annuity form" means the payment procedure and duration of a retirement 
26.28 	annuity or disability benefit available to a member of a public pension fund plan, based on 
26.29 	the period over which a retirement annuity or disability benefit is payable, determined by 
26.30 	the number of persons to whom the retirement annuity or disability benefit is payable, and 
26.31 	the amount of the retirement annuity or disability benefit which is payable to each person.
26.32 	(b) "Joint and survivor optional annuity" means an optional annuity form which 
26.33 	provides a retirement annuity or disability benefit to a retired member or disabilitant
27.1 	and the spouse of the member or disabilitant on a joint basis during the lifetime of the 
27.2 	retired member or disabilitant and all or a portion of the original retirement annuity or 
27.3 	disability benefit amount to the surviving spouse in the event of the death of the retired 
27.4 	member or disabilitant.
27.5 	(c) "Optional annuity form" means an annuity form which is elected by a member 
27.6 	and is not provided automatically as the standard annuity form of the public pension plan.
27.7 	(d) "Public pension plan" means a public pension plan as defined under section 
27.8 	356.63, paragraph (b). 
27.9 	(e) "Retirement annuity" means a series of monthly payments to which a former or 
27.10 	retired member of a public pension fund plan is entitled due to attaining a specified age 
27.11 	and acquiring credit for a specified period of service, which includes a retirement annuity, 
27.12 	retirement allowance, or service pension.
27.13 	(f) "Disability benefit" means a series of monthly payments to which a former or 
27.14 	disabled member of a public pension fund plan is entitled due to a physical or mental 
27.15 	inability to engage in specified employment.
27.16 		Subd. 2.Provision of information on annuity forms. (a) Every public pension 
27.17 	plan which provides for an annuity form other than a single life retirement annuity as an 
27.18 	option which can be elected by an active, disabled, or retiring member shall provide as a 
27.19 	part of, or accompanying the annuity application form, a written statement summarizing 
27.20 	the optional annuity forms which are available, a general indication of the consequences 
27.21 	of selecting one annuity form over another, a calculation of the actuarial reduction in the 
27.22 	amount of the retirement annuity which would be required for each optional annuity 
27.23 	form, and the procedure to be followed to obtain more information from the public 
27.24 	pension fund plan administration concerning the optional all annuity forms provided by 
27.25 	the plan. If the public pension plan offers joint and survivor optional annuity forms, the 
27.26 	annuity application and accompanying information must include a statement informing 
27.27 	the member and the member's spouse that, notwithstanding any law to the contrary, 
27.28 	unless the spouse waives any rights to an optional annuity by a notarized statement on 
27.29 	the annuity application or other form provided by the pension plan administration, the 
27.30 	public pension plan administration shall assume that the member selected the 50 percent 
27.31 	joint and survivor optional annuity form.
27.32 	(b) In lieu of the notarized statement requirement referred to in paragraph (a), the 
27.33 	pension plan administration may accept a statement which has been verified, including 
27.34 	electronic verification, by administrators of the pension plan.
27.35 		Subd. 3.Requirement of notice to member's spouse. (a) Except as specified 
27.36 	in paragraph (c), if a Every public pension plan administration that provides optional 
28.1 	retirement annuity forms which includefor a joint and survivor optional retirement or 
28.2 	disability annuity form potentially applicable to the surviving spouse of a member, the 
28.3 	executive director of the public pension plan shall send a copy of the written statement 
28.4 	required by subdivision 2 to the spouse of the member before the member's election
28.5 	selection of a retirement annuity the form of retirement or disability benefit.
28.6 	(b) Following the election selection of a retirement or disability annuity by the 
28.7 	member, a copy of the completed retirement annuity application and retirement annuity 
28.8 	beneficiary form, if applicable, must be sent by the executive director of the public 
28.9 	pension plan to the spouse of the retiring or disabled member. A signed acknowledgment 
28.10 	must be required from the spouse confirming receipt of a copy of the completed retirement
28.11 	annuity application and retirement annuity beneficiary form, unless the spouse's signature 
28.12 	confirming acknowledging the receipt annuity form selected is on the annuity application
28.13 	or other form as designated by the plan. If the required signed acknowledgment is public 
28.14 	pension plan administration has not received from the spouse within 30 days, a signed 
28.15 	acknowledgment, because the annuity application or other form as designated by the public 
28.16 	pension plan administration did not include the spouse's signature, the executive director 
28.17 	of the public pension plan must send another copy of the completed retirement annuity 
28.18 	applicationnotify the member and retirement annuity beneficiary form, if applicable, to
28.19 	the member's spouse that the 50 percent joint and survivor annuity form, or a higher joint 
28.20 	and survivor form if selected, shall be paid if the spouse does not acknowledge the annuity 
28.21 	form selected by the member by responding to the second notice sent to the spouse within 
28.22 	30 days. The second notice must be sent by certified mail with restricted delivery.
28.23 	(c) If a public pension plan administration receives notice that the provisions of 
28.24 	this section have not been complied with, or if a member selects a benefit form without 
28.25 	the valid consent of the member's spouse, the executive director of the public pension 
28.26 	plan shall suspend the payment of monthly benefits and shall take all actions necessary 
28.27 	to comply with this subdivision.
28.28 	(d) For the Teachers Retirement Association, the statement to the spouse that is 
28.29 	required under paragraph (a) must be sent before or upon the member's election of an 
28.30 	annuity.
28.31 		Subd. 4.Plan exclusions. This section does not apply to:
28.32 	(1) any volunteer fire relief association to which sections 69.771 to 69.776 apply; and
28.33 	(2) any plan under which the applicable surviving spouse would receive automatic 
28.34 	surviving spouse coverage if a joint and survivor annuity were not elected.
29.1 		Subd. 5.Disabilitant survivor treatment. This section should not be interpreted as 
29.2 	prohibiting payment of a survivor annuity to the spouse of a deceased disabilitant, in lieu of 
29.3 	any other annuity, if laws specific to the plan provide for a higher surviving spouse annuity.
29.4 		Subd. 6.Limitations due to marriage dissolution. The requirement to pay a 50 
29.5 	percent joint and survivor annuity is void if there is a court order to the contrary.
29.6 		Subd. 7.Liability waiver. The pension fund and plan, its employees, and any agent 
29.7 	working on behalf of the plan administration are not liable for harm caused by any act of 
29.8 	fraud committed by the retiring member or current or previous spouse, or any information 
29.9 	withheld from, or incorrect information supplied to the plan administration.

29.10 	EFFECTIVE DATE. This section is effective January 1, 2009, and applies to 
29.11 	annuities that are elected and commence on or after that date.

29.12 	ARTICLE 5
29.13 	ADMINISTRATIVE PROVISIONS

29.14 	Section 1. Minnesota Statutes 2007 Supplement, section 352.01, subdivision 2a, 
29.15 	is amended to read:
29.16 		Subd. 2a.Included employees. (a) "State employee" includes:
29.17 	(1) employees of the Minnesota Historical Society;
29.18 	(2) employees of the State Horticultural Society;
29.19 	(3) employees of the Minnesota Crop Improvement Association;
29.20 	(4) employees of the adjutant general who are paid from federal funds and who are 
29.21 	not covered by any federal civilian employees retirement system;
29.22 	(5) employees of the Minnesota State Colleges and Universities employed under the 
29.23 	university or college activities program;
29.24 	(6) currently contributing employees covered by the system who are temporarily 
29.25 	employed by the legislature during a legislative session or any currently contributing 
29.26 	employee employed for any special service as defined in subdivision 2b, clause (8);
29.27 	(7) employees of the legislature appointed without a limit on the duration of their 
29.28 	employment and persons employed or designated by the legislature or by a legislative 
29.29 	committee or commission or other competent authority to conduct a special inquiry, 
29.30 	investigation, examination, or installation;
29.31 	(8) trainees who are employed on a full-time established training program 
29.32 	performing the duties of the classified position for which they will be eligible to receive 
29.33 	immediate appointment at the completion of the training period;
29.34 	(9) employees of the Minnesota Safety Council;
30.1 	(10) any employees on authorized leave of absence from the Transit Operating 
30.2 	Division of the former Metropolitan Transit Commission who are employed by the 
30.3 	labor organization which is the exclusive bargaining agent representing employees of 
30.4 	the Transit Operating Division;
30.5 	(11) employees of the Metropolitan Council, Metropolitan Parks and Open Space 
30.6 	Commission, Metropolitan Sports Facilities Commission, Metropolitan Mosquito Control 
30.7 	Commission, or Metropolitan Radio Board unless excluded or covered by another public 
30.8 	pension fund or plan under section 473.415, subdivision 3;
30.9 	(12) judges of the Tax Court;
30.10 	(13) personnel employed on June 30, 1992, by the University of Minnesota in the 
30.11 	management, operation, or maintenance of its heating plant facilities, whose employment 
30.12 	transfers to an employer assuming operation of the heating plant facilities, so long as the 
30.13 	person is employed at the University of Minnesota heating plant by that employer or by its 
30.14 	successor organization;
30.15 	(14) seasonal help in the classified service employed by the Department of Revenue; 
30.16 	(15) persons employed by the Department of Commerce as a peace officer in 
30.17 	the Insurance Fraud Prevention Division under section 45.0135 who have attained the 
30.18 	mandatory retirement age specified in section 43A.34, subdivision 4;
30.19 	(16) employees of the University of Minnesota unless excluded under subdivision 
30.20 	2b, clause (3); and
30.21 	(17) employees of the Middle Management Association whose employment began 
30.22 	after July 1, 2007, and to whom section 352.029 does not apply.; and
30.23 	(18) employees of the Minnesota Government Engineers Council to whom section 
30.24 	352.029 does not apply.
30.25 	(b) Employees specified in paragraph (a), clause (13), are included employees under 
30.26 	paragraph (a) if employer and employee contributions are made in a timely manner in the 
30.27 	amounts required by section 352.04. Employee contributions must be deducted from 
30.28 	salary. Employer contributions are the sole obligation of the employer assuming operation 
30.29 	of the University of Minnesota heating plant facilities or any successor organizations to 
30.30 	that employer.

30.31 	Sec. 2. Minnesota Statutes 2007 Supplement, section 352.017, subdivision 2, is 
30.32 	amended to read:
30.33 		Subd. 2.Purchase procedure. (a) An employee covered by a plan specified in 
30.34 	this chapter may purchase credit for allowable service in that plan for a period specified 
30.35 	in subdivision 1 if the employee makes a payment as specified in paragraph (b) or (c), 
31.1 	whichever applies. The employing unit, at its option, may pay the employer portion of the 
31.2 	amount specified in paragraph (b) on behalf of its employees.
31.3 	(b) If payment is received by the executive director within one year from the end of
31.4 	date the employee returned to work following the authorized leave, the payment amount is 
31.5 	equal to the employee and employer contribution rates specified in law for the applicable 
31.6 	plan at the end of the leave period multiplied by the employee's hourly rate of salary on 
31.7 	the date of return from the leave of absence and by the days and months of the leave of 
31.8 	absence for which the employee wantsis eligible for allowable service credit. Payments 
31.9 	made under this paragraphThe payment must include compound interest at a monthly 
31.10 	rate of 0.71 percent from the last day of the leave period until the last day of the month in 
31.11 	which payment is received. If payment is received by the executive director after one year, 
31.12 	the payment amount is the amount determined under section 356.551. Payment under this 
31.13 	paragraph must be made before the date of termination from public employment covered 
31.14 	under this chapter.
31.15 	(c) If payment is received by the executive director after one year, the payment 
31.16 	amount is the amount determined under  section 356.551. If the employee terminates 
31.17 	employment covered by this chapter during the leave or following the leave rather than 
31.18 	returning to covered employment, payment must be received by the executive director 
31.19 	within 30 days after the termination date. The payment amount is equal to the employee 
31.20 	and employer contribution rates specified in law for the applicable plan on the day prior to 
31.21 	the termination date, multiplied by the employee's hourly rate of salary on that date and by 
31.22 	the days and months of the leave of absence prior to termination.

31.23 	EFFECTIVE DATE. This section is effective retroactively from July 1, 2007.

31.24 	Sec. 3. Minnesota Statutes 2006, section 352.03, subdivision 4, is amended to read:
31.25 		Subd. 4.Duties and powers of board of directors. (a) The board shall:
31.26 	(1) elect a chair;
31.27 	(2) appoint an executive director;
31.28 	(3) establish rules to administer this chapter and chapters 3A, 352B, 352C, 352D, 
31.29 	and 490 and transact the business of the system, subject to the limitations of law;
31.30 	(4) consider and dispose of, or take any other action the board of directors deems 
31.31 	appropriate concerning denials of applications for annuities or disability benefits under 
31.32 	this chapter, and complaints of employees and others pertaining to the retirement of 
31.33 	employees and the operation of the system;
31.34 	(5) advise the director on any matters relating to the system and carrying out 
31.35 	functions and purposes of this chapter. The board's advice shall control; and
32.1 	(6)(5) oversee the administration of the state deferred compensation plan established 
32.2 	in section 352.96; and
32.3 	(6) oversee the administration of the health care savings plan established in section 
32.4 	352.98. 
32.5 	The director and assistant director must be in the unclassified service but appointees 
32.6 	may be selected from civil service lists if desired. The salary of the executive director 
32.7 	must be as provided by section 15A.0815. The salary of the assistant director must be set 
32.8 	in accordance with section 43A.18, subdivision 3. 
32.9 	(b) The board shall advise the director on any matters relating to the system and 
32.10 	carrying out functions and purposes of this chapter. The board's advice shall control.

32.11 	EFFECTIVE DATE. This section is effective the day after final enactment.

32.12 	Sec. 4. Minnesota Statutes 2006, section 352.03, subdivision 5, is amended to read:
32.13 		Subd. 5.Executive director; assistant director. (a) The executive director, in this 
32.14 	chapter called the director, of the system must be appointed by the board on the basis of 
32.15 	fitness, experience in the retirement field, and leadership ability. The director must have 
32.16 	had at least five years' experience on the administrative staff of a major retirement system.
32.17 	(b) The executive director and assistant director must be in the unclassified service 
32.18 	but appointees may be selected from civil service lists if desired. The salary of the 
32.19 	executive director must be as provided by section 15A.0815. The salary of the assistant 
32.20 	director must be set in accordance with section 43A.18, subdivision 3.

32.21 	EFFECTIVE DATE. This section is effective the day after final enactment.

32.22 	Sec. 5. Minnesota Statutes 2006, section 352.22, subdivision 10, is amended to read:
32.23 		Subd. 10.Other refunds. Former employees covered by the system are entitled 
32.24 	to apply for refunds if they are or become members of the State Patrol retirement fund, 
32.25 	the state Teachers Retirement Association, or employees of the University of Minnesota 
32.26 	excluded from coverage under the system by action of the Board of Regents; or employees 
32.27 	of the adjutant general who under federal law effectually elect membership in a federal 
32.28 	retirement system; or officers or employees of the senate or house of representatives, 
32.29 	excluded from coverage under section 352.01, subdivision 2b, clause (7). The refunds 
32.30 	must include accumulated contributions plus interest as provided in subdivision 2. These 
32.31 	employees may apply for a refund once 30 days or more have elapsed after their coverage 
32.32 	ceases, even if they continue in state service but in positions not covered by this chapter.

32.33 	EFFECTIVE DATE. This section is effective the day following final enactment.

33.1 	Sec. 6. Minnesota Statutes 2007 Supplement, section 352.955, subdivision 3, is 
33.2 	amended to read:
33.3 		Subd. 3.Payment of additional equivalent contributions; post-June 30, 2007, 
33.4 	coverage transfers. (a) An eligible employee who wasis transferred to plan coverage 
33.5 	after June 30, 2007, and who elects to transfer past service credit under this section must 
33.6 	pay an additional member contribution for that prior service period. The additional 
33.7 	member contribution is (1) the difference between the member contribution rate or rates 
33.8 	for the general state employees retirement plan of the Minnesota State Retirement System 
33.9 	for the period of employment covered by the service credit to be transferred and the 
33.10 	member contribution rate or rates for the correctional state employees retirement plan 
33.11 	for the most recent 12 month period of employment covered by the service credit to be 
33.12 	transferred, plus annual compound interest at the rate of 8.5 percent, and (2)the amount 
33.13 	computed under paragraph (b), plus the greater of the amount computed under paragraph 
33.14 	(c), or 40 percent of the unfunded actuarial accrued liability attributable to the past service 
33.15 	credit transfer. The unfunded actuarial accrued liability attributable to the past service 
33.16 	credit transfer is the present value of the benefit obtained by the transfer of the service 
33.17 	credit to the correctional state employees retirement plan reduced by the amount of the 
33.18 	asset transfer under subdivision 4, by the amount of the member contribution equivalent 
33.19 	payment under clause (1), and by the amount of the employer contribution equivalent 
33.20 	payment under paragraph (c), clause (1).
33.21 	(b) The executive director shall compute, for the most recent 12 months of service 
33.22 	credit eligible for transfer, or for the entire period eligible for transfer if less than 12 
33.23 	months, the difference between the employee contribution rate or rates for the general state 
33.24 	employees retirement plan and the employee contribution rate or rates for the correctional 
33.25 	state employees retirement plan applied to the eligible employee's salary during that 
33.26 	transfer period, plus compound interest at a monthly rate of 0.71 percent.
33.27 	(c) The executive director shall compute, for any service credit being transferred 
33.28 	on behalf of the eligible employee and not included under paragraph (b), the difference 
33.29 	between the employee contribution rate or rates for the general state employees retirement 
33.30 	plan and the employee contribution rate or rates for the correctional state employees 
33.31 	retirement plan applied to the eligible employee's salary during that transfer period, plus 
33.32 	compound interest at a monthly rate of 0.71 percent.
33.33 	(d) The executive director shall compute an amount using the process specified in 
33.34 	paragraph (b), but based on differences in employer contribution rates between the general 
33.35 	state employees retirement plan and the correctional state employees retirement plan 
33.36 	rather than employee contribution rates.
34.1 	(e) The executive director shall compute an amount using the process specified in 
34.2 	paragraph (c), but based on differences in employer contribution rates between the general 
34.3 	state employees retirement plan and the correctional state employees retirement plan 
34.4 	rather than employee contribution rates.
34.5 	(f) The additional equivalent member contribution under this subdivision must be 
34.6 	paid in a lump sum. Payment must accompany the election to transfer the prior service 
34.7 	credit. No transfer election or additional equivalent member contribution payment may be 
34.8 	made by a person or accepted by the executive director after the one year anniversary date 
34.9 	of the effective date of the retirement coverage transfer, or the date on which the eligible 
34.10 	employee terminates state employment, whichever is earlier.
34.11 	(c)(g) If an eligible employee elects to transfer past service credit under this section 
34.12 	and pays the additional equivalent member contribution amount under subdivision 2
34.13 	paragraph (a), the applicable department shall pay an additional equivalent employer 
34.14 	contribution amount. The additional employer contribution is (1) the difference between 
34.15 	the employer contribution rate or rates for the general state employees retirement plan 
34.16 	for the period of employment covered by the service credit to be transferred and the 
34.17 	employer contribution rate or rates for the correctional state employees retirement 
34.18 	plan for the period of employment covered by the service credit to be transferred, plus 
34.19 	annual compound interest at the rate of 8.5 percent, and (2)the amount computed under 
34.20 	paragraph (d), plus the greater of the amount computed under paragraph (e), or 60 percent 
34.21 	of the unfunded actuarial accrued liability attributable to the past service credit transfer
34.22 	calculated as provided in paragraph (a), clause (2).
34.23 	(h) The unfunded actuarial accrued liability attributable to the past service credit 
34.24 	transfer is the present value of the benefit obtained by the transfer of the service credit 
34.25 	to the correctional state employees retirement plan reduced by the amount of the asset 
34.26 	transfer under subdivision 4, by the amount of the member contribution equivalent 
34.27 	payment computed under paragraph (b), and by the amount of the employer contribution 
34.28 	equivalent payment computed under paragraph (d).
34.29 	(d)(i) The additional equivalent employer contribution under this subdivision must 
34.30 	be paid in a lump sum and must be paid within 30 days of the date on which the executive 
34.31 	director of the Minnesota State Retirement System certifies to the applicable department 
34.32 	that the employee paid the additional equivalent member contribution.

34.33 	EFFECTIVE DATE. This section is effective the day following final enactment.

34.34 	Sec. 7. Minnesota Statutes 2007 Supplement, section 352.955, subdivision 5, is 
34.35 	amended to read:
35.1 		Subd. 5.Effect of the asset transfer. Upon the transfer of assets under subdivision 
35.2 	4, the service credit in the general state employees retirement plan of the Minnesota State 
35.3 	Retirement System related to the period being transferred is forfeited and may not be 
35.4 	reinstated. The transferred service credit and the transferred assets must be credited to the 
35.5 	correctional state employees retirement plan and fund, respectively.

35.6 	EFFECTIVE DATE. This section is effective the day following final enactment.

35.7 	Sec. 8. Minnesota Statutes 2006, section 352.98, subdivision 1, is amended to read:
35.8 		Subdivision 1.Plan created. This section must be administered by the executive 
35.9 	director of the system with the advice and consent of the board of directors. The Minnesota 
35.10 	State Retirement Systemexecutive director shall establish a plan or plans, known as health 
35.11 	care savings plans, through which public employers and employees an officer or employee 
35.12 	of the state or of a political subdivision, including officers or employees covered by a plan 
35.13 	or fund specified in chapter 353D, 354B, 354D, 424A, or section 356.20, subdivision 2, 
35.14 	may save to cover health care costs. For purposes of this section, a volunteer firefighter 
35.15 	is an employee. The Minnesota State Retirement Systemexecutive director shall make 
35.16 	available one or more trusts, including a governmental trust or governmental trusts, 
35.17 	authorized under the Internal Revenue Code to be eligible for tax-preferred or tax-free 
35.18 	treatment through which employers and employees can save to cover health care costs.

35.19 	EFFECTIVE DATE. This section is effective the day following final enactment.

35.20 	Sec. 9. Minnesota Statutes 2006, section 352.98, subdivision 2, is amended to read:
35.21 		Subd. 2.Contracting authorized. The Minnesota State Retirement System is 
35.22 	authorized toexecutive director shall administer the plan and to contract with public and 
35.23 	private entities to provide investment services, record keeping, benefit payments, and other 
35.24 	functions necessary for the administration of the plan. If allowed by the Minnesota State 
35.25 	Board of Investment, the Minnesota State Board of Investment supplemental investment 
35.26 	funds may be offered as investment options under the health care savings plan or plans.

35.27 	EFFECTIVE DATE. This section is effective the day following final enactment.

35.28 	Sec. 10. Minnesota Statutes 2006, section 352.98, subdivision 3, is amended to read:
35.29 		Subd. 3.Contributions. (a) Contributions to the plan must be determined through
35.30 	defined in a personnel policy or in a collective bargaining agreement of a public employer 
35.31 	with the exclusive representative of the covered employees in an appropriate unit or 
35.32 	political subdivision. The Minnesota State Retirement Systemexecutive director may 
36.1 	offer different types of trusts permitted under the Internal Revenue Code to best meet the 
36.2 	needs of different employeeemployer units.
36.3 	(b) Contributions to the plan by or on behalf of the employeeparticipant must 
36.4 	be held in trust for reimbursement of employee and dependenteligible health-related 
36.5 	expenses for participants and their dependents following retirementtermination from 
36.6 	public employment or during active employment. The Minnesota State Retirement 
36.7 	Systemexecutive director shall maintain a separate account of the contributions made by 
36.8 	or on behalf of each participant and the earnings thereon. The Minnesota State Retirement 
36.9 	Systemexecutive director shall make available a limited range of investment options, 
36.10 	and each employeeparticipant may direct the investment of the accumulations in the 
36.11 	employee'sparticipant's account among the investment options made available by the 
36.12 	Minnesota State Retirement System executive director. At the request of a participating 
36.13 	employer and employee group, the Minnesota State Retirement System may determine 
36.14 	how the assets of the affected employer and employee group should be invested.
36.15 	(c) This section does not obligate a public employer to meet and negotiate in good 
36.16 	faith with the exclusive bargaining representative of any public employee group regarding 
36.17 	an employer contribution to a postretirement or active employee health care savings plan 
36.18 	authorized by this section and section 356.24, subdivision 1, clause (7). It is not the intent 
36.19 	of the legislature to authorize the state to incur new funding obligations for the costs of 
36.20 	retiree health care or the costs of administering retiree health care plans or accounts. 

36.21 	EFFECTIVE DATE. This section is effective the day following final enactment.

36.22 	Sec. 11. Minnesota Statutes 2006, section 352.98, subdivision 4, is amended to read:
36.23 		Subd. 4.Reimbursement for health-related expenses. The Minnesota State 
36.24 	Retirement Systemexecutive director shall reimburse employeesparticipants at least 
36.25 	quarterly for submittedeligible health-related expenses, as requiredallowable by federal 
36.26 	and state law, until the employeeparticipant exhausts the accumulation in the employee's
36.27 	participant's account. If an employeea participant dies prior to exhausting the employee's
36.28 	participant's account balance, the employee'sparticipant's spouse or dependents are 
36.29 	eligible to be reimbursed for health care expenses from the account until the account 
36.30 	balance is exhausted. If an account balance remains after the death of a participant and 
36.31 	all of the participant's legal dependents, the remainder of the account must be paid to the 
36.32 	employee'sparticipant's beneficiaries or, if none, to the employee'sparticipant's estate.

36.33 	EFFECTIVE DATE. This section is effective the day following final enactment.

37.1 	Sec. 12. Minnesota Statutes 2006, section 352.98, subdivision 5, is amended to read:
37.2 		Subd. 5.Fees. The Minnesota state retirement planexecutive director is authorized 
37.3 	to charge uniform fees to participants to cover the ongoing cost of operating the plan. 
37.4 	Any fees not needed must revert to participant accounts or be used to reduce plan fees 
37.5 	the following year.

37.6 	EFFECTIVE DATE. This section is effective the day following final enactment.

37.7 	Sec. 13. Minnesota Statutes 2006, section 352D.075, subdivision 2a, is amended to 
37.8 	read:
37.9 		Subd. 2a.Surviving spouse coverage term certain. In lieu of the annuity under 
37.10 	subdivision 2, clause (2) or (3), or in lieu of a distribution under subdivision 2, clause (1), 
37.11 	the surviving spouse of a deceased participant may elect to receive survivor coverage in 
37.12 	the form of a term certain annuity of five, six ten, 15, or 20 years, based on the value of 
37.13 	the remaining shares. The monthly term certain annuity must be calculated under section 
37.14 	352D.06, subdivision 1. 

37.15 	EFFECTIVE DATE. This section is effective the day following final enactment.

37.16 	Sec. 14. Minnesota Statutes 2007 Supplement, section 353.01, subdivision 2b, is 
37.17 	amended to read:
37.18 		Subd. 2b.Excluded employees. The following public employees are not eligible 
37.19 	to participate as members of the association with retirement coverage by the public 
37.20 	employees retirement plan, the local government correctional employees retirement plan 
37.21 	under chapter 353E, or the public employees police and fire retirement plan:
37.22 	(1) public officers, other than county sheriffs, who are elected to a governing body, 
37.23 	or persons who are appointed to fill a vacancy in an elective office of a governing body, 
37.24 	whose term of office commences on or after July 1, 2002, for the service to be rendered 
37.25 	in that elective position;
37.26 	(2) election officers or election judges;
37.27 	(3) patient and inmate personnel who perform services for a governmental 
37.28 	subdivision;
37.29 	(4) except as otherwise specified in subdivision 12a, employees who are hired for 
37.30 	a temporary position as defined under subdivision 12a, and employees who resign from 
37.31 	a nontemporary position and accept a temporary position within 30 days in the same 
37.32 	governmental subdivision;
38.1 	(5) employees who are employed by reason of work emergency caused by fire, 
38.2 	flood, storm, or similar disaster;
38.3 	(6) employees who by virtue of their employment in one governmental subdivision 
38.4 	are required by law to be a member of and to contribute to any of the plans or funds 
38.5 	administered by the Minnesota State Retirement System, the Teachers Retirement 
38.6 	Association, the Duluth Teachers Retirement Fund Association, the St. Paul Teachers 
38.7 	Retirement Fund Association, the Minneapolis Employees Retirement Fund, or any police 
38.8 	or firefighters relief association governed by section 69.77 that has not consolidated 
38.9 	with the Public Employees Retirement Association, or any local police or firefighters 
38.10 	consolidation account who have not elected the type of benefit coverage provided by the 
38.11 	public employees police and fire fund under sections 353A.01 to 353A.10, or any persons 
38.12 	covered by section 353.665, subdivision 4, 5, or 6, who have not elected public employees 
38.13 	police and fire plan benefit coverage. This clause must not be construed to prevent a person 
38.14 	from being a member of and contributing to the Public Employees Retirement Association 
38.15 	and also belonging to and contributing to another public pension plan or fund for other 
38.16 	service occurring during the same period of time. A person who meets the definition of 
38.17 	"public employee" in subdivision 2 by virtue of other service occurring during the same 
38.18 	period of time becomes a member of the association unless contributions are made to 
38.19 	another public retirement fund on the salary based on the other service or to the Teachers 
38.20 	Retirement Association by a teacher as defined in section 354.05, subdivision 2;
38.21 	(7) persons who are members of a religious order and are excluded from coverage 
38.22 	under the federal Old Age, Survivors, Disability, and Health Insurance Program for the 
38.23 	performance of service as specified in United States Code, title 42, section 410(a)(8)(A), 
38.24 	as amended through January 1, 1987, if no irrevocable election of coverage has been made 
38.25 	under section 3121(r) of the Internal Revenue Code of 1954, as amended;
38.26 	(8) employees of a governmental subdivision who have not reached the age of 
38.27 	23 and are enrolled on a full-time basis to attend or are attending classes on a full-time 
38.28 	basis at an accredited school, college, or university in an undergraduate, graduate, or 
38.29 	professional-technical program, or a public or charter high school;
38.30 	(9) resident physicians, medical interns, and pharmacist residents and pharmacist 
38.31 	interns who are serving in a degree or residency program in public hospitals or clinics;
38.32 	(10) students who are serving in an internship or residency program sponsored 
38.33 	by an accredited educational institution;
38.34 	(11) persons who hold a part-time adult supplementary technical college license who 
38.35 	render part-time teaching service in a technical college;
39.1 	(12) except for employees of Hennepin County or Hennepin Healthcare System, 
39.2 	Inc., foreign citizens working for a governmental subdivision with a work permit of less 
39.3 	than three years, or an H-1b visa valid for less than three years of employment. Upon 
39.4 	notice to the association that the work permit or visa extends beyond the three-year period, 
39.5 	the foreign citizens must be reported for membership from the date of the extension;
39.6 	(13) public hospital employees who elected not to participate as members of the 
39.7 	association before 1972 and who did not elect to participate from July 1, 1988, to October 
39.8 	1, 1988;
39.9 	(14) except as provided in section 353.86, volunteer ambulance service personnel, 
39.10 	as defined in subdivision 35, but persons who serve as volunteer ambulance service 
39.11 	personnel may still qualify as public employees under subdivision 2 and may be members 
39.12 	of the Public Employees Retirement Association and participants in the public employees 
39.13 	retirement fund or the public employees police and fire fund, whichever applies, on the 
39.14 	basis of compensation received from public employment service other than service as 
39.15 	volunteer ambulance service personnel;
39.16 	(15) except as provided in section 353.87, volunteer firefighters, as defined in 
39.17 	subdivision 36, engaging in activities undertaken as part of volunteer firefighter duties; 
39.18 	provided that a person who is a volunteer firefighter may still qualify as a public 
39.19 	employee under subdivision 2 and may be a member of the Public Employees Retirement 
39.20 	Association and a participant in the public employees retirement fund or the public 
39.21 	employees police and fire fund, whichever applies, on the basis of compensation received 
39.22 	from public employment activities other than those as a volunteer firefighter;
39.23 	(16) pipefitters and associated trades personnel employed by Independent School 
39.24 	District No. 625, St. Paul, with coverage under a collective bargaining agreement by the 
39.25 	pipefitters local 455 pension plan who were either first employed after May 1, 1997, or, 
39.26 	if first employed before May 2, 1997, elected to be excluded under Laws 1997, chapter 
39.27 	241, article 2, section 12;
39.28 	(17) electrical workers, plumbers, carpenters, and associated trades personnel 
39.29 	employed by Independent School District No. 625, St. Paul, or the city of St. Paul, 
39.30 	who have retirement coverage under a collective bargaining agreement by the Electrical 
39.31 	Workers Local 110 pension plan, the United Association Plumbers Local 34 pension plan, 
39.32 	or the Carpenters Local 87 pension plan who were either first employed after May 1, 
39.33 	2000, or, if first employed before May 2, 2000, elected to be excluded under Laws 2000, 
39.34 	chapter 461, article 7, section 5;
39.35 	(18) bricklayers, allied craftworkers, cement masons, glaziers, glassworkers, 
39.36 	painters, allied tradesworkers, and plasterers employed by the city of St. Paul or 
40.1 	Independent School District No. 625, St. Paul, with coverage under a collective 
40.2 	bargaining agreement by the Bricklayers and Allied Craftworkers Local 1 pension plan, 
40.3 	the Cement Masons Local 633 pension plan, the Glaziers and Glassworkers Local L-1324 
40.4 	pension plan, the Painters and Allied Trades Local 61 pension plan, or the Twin Cities 
40.5 	Plasterers Local 265 pension plan who were either first employed after May 1, 2001, or if 
40.6 	first employed before May 2, 2001, elected to be excluded under Laws 2001, First Special 
40.7 	Session chapter 10, article 10, section 6;
40.8 	(19) plumbers employed by the Metropolitan Airports Commission, with coverage 
40.9 	under a collective bargaining agreement by the Plumbers Local 34 pension plan, who either 
40.10 	were first employed after May 1, 2001, or if first employed before May 2, 2001, elected to 
40.11 	be excluded under Laws 2001, First Special Session chapter 10, article 10, section 6;
40.12 	(20) employees who are hired after June 30, 2002, to fill seasonal positions under 
40.13 	subdivision 12b which are limited in duration by the employer to 185 consecutive calendar 
40.14 	days or less in each year of employment with the governmental subdivision;
40.15 	(21) persons who are provided supported employment or work-study positions 
40.16 	by a governmental subdivision and who participate in an employment or industries 
40.17 	program maintained for the benefit of these persons where the governmental subdivision 
40.18 	limits the position's duration to three years or less, including persons participating in a 
40.19 	federal or state subsidized on-the-job training, work experience, senior citizen, youth, or 
40.20 	unemployment relief program where the training or work experience is not provided as a 
40.21 	part of, or for, future permanent public employment;
40.22 	(22) independent contractors and the employees of independent contractors; and
40.23 	(23) reemployed annuitants of the association during the course of that 
40.24 	reemployment.

40.25 	EFFECTIVE DATE. This section is effective the day following final enactment.

40.26 	Sec. 15. Minnesota Statutes 2006, section 353.01, subdivision 10, is amended to read:
40.27 		Subd. 10.Salary. (a) Subject to the limitations of section 356.611, "salary" means:
40.28 	(1) the periodic compensation of a public employee, before deductions for deferred 
40.29 	compensation, supplemental retirement plans, or other voluntary salary reduction 
40.30 	programs, and also means "wages" and includes net income from fees;
40.31 	(2) for a public employee who is covered by a supplemental retirement plan under 
40.32 	section 356.24, subdivision 1, clause (8), (9), or (10), which require all plan contributions 
40.33 	be made by the employer, the contribution to the applicable supplemental retirement plan 
40.34 	when an agreement between the parties establishes that the contribution is fromwill either 
41.1 	result in a mandatory withholdings fromreduction of employees' wages through payroll 
41.2 	withholdings, or be made in lieu of an amount that would otherwise be paid as wages; and
41.3 	(3) for a public employee who has prior service covered by a local police or 
41.4 	firefighters relief association that has consolidated with the Public Employees Retirement 
41.5 	Association or to which section 353.665 applies and who has elected coverage either 
41.6 	under the public employees police and fire fund benefit plan under section 353A.08
41.7 	following the consolidation or under section 353.665, subdivision 4, the rate of salary 
41.8 	upon which member contributions to the special fund of the relief association were made 
41.9 	prior to the effective date of the consolidation as specified by law and by bylaw provisions 
41.10 	governing the relief association on the date of the initiation of the consolidation procedure 
41.11 	and the actual periodic compensation of the public employee after the effective date of 
41.12 	consolidation.
41.13 	(b) Salary does not mean:
41.14 	(1) the fees paid to district court reporters, unused annual vacation or sick leave 
41.15 	payments, in lump-sum or periodic payments, severance payments, reimbursement of 
41.16 	expenses, lump-sum settlements not attached to a specific earnings period, or workers' 
41.17 	compensation payments;
41.18 	(2) employer-paid amounts used by an employee toward the cost of insurance 
41.19 	coverage, employer-paid fringe benefits, flexible spending accounts, cafeteria plans, health 
41.20 	care expense accounts, day care expenses, or any payments in lieu of any employer-paid 
41.21 	group insurance coverage, including the difference between single and family rates that 
41.22 	may be paid to a member with single coverage and certain amounts determined by the 
41.23 	executive director to be ineligible;
41.24 	(3) the amount equal to that which the employing governmental subdivision would 
41.25 	otherwise pay toward single or family insurance coverage for a covered employee when, 
41.26 	through a contract or agreement with some but not all employees, the employer:
41.27 	(i) discontinues, or for new hires does not provide, payment toward the cost of the 
41.28 	employee's selected insurance coverages under a group plan offered by the employer;
41.29 	(ii) makes the employee solely responsible for all contributions toward the cost of 
41.30 	the employee's selected insurance coverages under a group plan offered by the employer, 
41.31 	including any amount the employer makes toward other employees' selected insurance 
41.32 	coverages under a group plan offered by the employer; and
41.33 	(iii) provides increased salary rates for employees who do not have any 
41.34 	employer-paid group insurance coverages;
42.1 	(4) except as provided in section 353.86 or 353.87, compensation of any kind paid to 
42.2 	volunteer ambulance service personnel or volunteer firefighters, as defined in subdivision 
42.3 	35 or 36; and
42.4 	(5) the amount of compensation that exceeds the limitation provided in section 
42.5 	356.611; and
42.6 	(6) amounts paid by a federal or state grant for which the grant specifically 
42.7 	prohibits grant proceeds from being used to make pension plan contributions, unless the 
42.8 	contributions to the plan are made from sources other than the federal or state grant.
42.9 	(c) Amounts provided to an employee by the employer through a grievance 
42.10 	proceeding or a legal settlement are salary only if the settlement is reviewed by the 
42.11 	executive director and the amounts are determined by the executive director to be 
42.12 	consistent with paragraph (a) and prior determinations.

42.13 	EFFECTIVE DATE. This section is effective the day following final enactment.

42.14 	Sec. 16. Minnesota Statutes 2006, section 353.01, subdivision 11a, is amended to read:
42.15 		Subd. 11a.Termination of public service. (a) "Termination of public service" 
42.16 	occurs (1) when a member resigns or is dismissed from public service by the employing 
42.17 	governmental subdivision and the employee does not, within 30 days of the date 
42.18 	the employment relationship ended, return to an employment position in the same 
42.19 	governmental subdivision; or (2) when the employer-employee relationship is severed due 
42.20 	to the expiration of a layoff under subdivision 12 or 12c.
42.21 	(b) The termination of public service must be recorded in the association records 
42.22 	upon receipt of an appropriate notice from the governmental subdivision.
42.23 	(c) A termination of public service does not occur if, prior to termination of service, 
42.24 	the member has an agreement, verbal or written, to return to a governmental subdivision 
42.25 	as an employee, independent contractor, or employee of an independent contractor.

42.26 	EFFECTIVE DATE. This section is effective the day following final enactment.

42.27 	Sec. 17. Minnesota Statutes 2006, section 353.01, is amended by adding a subdivision 
42.28 	to read:
42.29 		Subd. 16b.Uncredited military service credit purchase. (a) A public employee 
42.30 	who has at least three years of allowable service with the Public Employees Retirement 
42.31 	Association or the public employees police and fire plan and who performed service in 
42.32 	the United States armed forces before becoming a public employee, or who failed to 
42.33 	obtain service credit for a military leave of absence under subdivision 16, paragraph (h), is 
43.1 	entitled to purchase allowable service credit for the initial period of enlistment, induction, 
43.2 	or call to active duty without any voluntary extension by making payment under section 
43.3 	356.551 if the public employee has not purchased service credit from any other Minnesota 
43.4 	defined benefit public employee pension plan for the same period of service.
43.5 	(b) A public employee who desires to purchase service credit under paragraph 
43.6 	(a) must apply with the executive director to make the purchase. The application must 
43.7 	include all necessary documentation of the public employee's qualifications to make the 
43.8 	purchase, signed written permission to allow the executive director to request and receive 
43.9 	necessary verification of applicable facts and eligibility requirements, and any other 
43.10 	relevant information that the executive director may require.
43.11 	(c) Allowable service credit for the purchase period must be granted by the Public 
43.12 	Employees Retirement Association or the public employees police and fire plan, whichever 
43.13 	applies, to the purchasing public employee upon receipt of the purchase payment amount. 
43.14 	Payment must be made before the effective date of retirement of the public employee.
43.15 	(d) This subdivision is repealed July 1, 2013.

43.16 	EFFECTIVE DATE. This section is effective the day following final enactment.

43.17 	Sec. 18. Minnesota Statutes 2007 Supplement, section 353.0161, subdivision 2, 
43.18 	is amended to read:
43.19 		Subd. 2.Purchase procedure. (a) An employee covered by a plan specified in 
43.20 	subdivision 1 may purchase credit for allowable service in that plan for a period specified 
43.21 	in subdivision 1 if the employee makes a payment as specified in paragraph (b) or (c), 
43.22 	whichever applies. The employing unit, at its option, may pay the employer portion of the 
43.23 	amount specified in paragraph (b) on behalf of its employees.
43.24 	(b) If payment is received by the executive director within one year from the end 
43.25 	ofdate the member returned to work following the authorized leave, or within 30 days 
43.26 	after the date of termination of public service if the member did not return to work, the 
43.27 	payment amount is equal to the employee and employer contribution rates specified in 
43.28 	law for the applicable plan at the end of the leave period, or at termination of public 
43.29 	service, whichever is earlier, multiplied by the employee's hourly rate ofaverage monthly 
43.30 	salary on the dateupon which deductions were paid during the six months, or portion 
43.31 	thereof, before the commencement of return from the leave of absence and by the days 
43.32 	andnumber of months of the leave of absence for which the employee wants allowable 
43.33 	service credit. Payments made under this paragraph must include compound interest at 
43.34 	a monthly rate of 0.71 percent from the last day of the leave period until the last day of 
43.35 	the month in which payment is received.
44.1 	(c) If payment is received by the executive director after one year, the payment 
44.2 	amount is the amount determined under section 356.551. Payment under this paragraph 
44.3 	must be made before the date the person terminates public service under section 353.01, 
44.4 	subdivision 11a.

44.5 	EFFECTIVE DATE. This section is effective retroactively from July 1, 2007.

44.6 	Sec. 19. Minnesota Statutes 2006, section 353.27, is amended by adding a subdivision 
44.7 	to read:
44.8 		Subd. 7c.Limitation on additional plan coverage. No deductions for any plan 
44.9 	under this chapter or chapter 353E may be taken from the salary of a person who is 
44.10 	employed by a governmental subdivision under section 353.01, subdivision 6, and who is 
44.11 	receiving disability benefit payments from any plan under this chapter or chapter 353E 
44.12 	unless the person waives the right to further disability benefit payments.

44.13 	EFFECTIVE DATE. This section is effective the day following final enactment.

44.14 	Sec. 20. Minnesota Statutes 2007 Supplement, section 353.27, subdivision 14, is 
44.15 	amended to read:
44.16 		Subd. 14.Treatment of periods before initial coverage date. (a) If an entity is 
44.17 	determined to be a governmental subdivision due to receipt of a written notice of eligibility 
44.18 	from the association, that employer and its employees are subject to the requirements 
44.19 	of subdivision 12, effective retroactively to the date that the executive director of 
44.20 	the association determines that the entity first met the definition of a governmental 
44.21 	subdivision, if that date predates the notice of eligibility.
44.22 	(b) If the retroactive time period under paragraph (a) exceeds three years, an 
44.23 	employee is authorized to purchase service credit in the applicable Public Employees 
44.24 	Retirement Association plan for the portion of the period in excess of three years, by 
44.25 	making payment under section 356.551. Notwithstanding section 356.551, subdivision 2, 
44.26 	regarding time limits on purchases, payment may be made anytime before termination of 
44.27 	public service.
44.28 	(c) This subdivision does not apply if the applicable employment under paragraph 
44.29 	(a) included coverage by any public or private defined benefit or defined contribution 
44.30 	retirement plan, other than a volunteer firefighters relief association. If this paragraph 
44.31 	applies, an individual is prohibited from purchasing service credit for any period or 
44.32 	periods specified in paragraph (a).

44.33 	EFFECTIVE DATE. This section is effective the day following final enactment.

45.1 	Sec. 21. Minnesota Statutes 2006, section 353.33, subdivision 5, is amended to read:
45.2 		Subd. 5.Benefits paid under workers' compensation law. (a) Disability benefits 
45.3 	paid shall be coordinated with any amounts, other than those amounts excluded under 
45.4 	paragraph (b), received or receivable under workers' compensation law, such as temporary 
45.5 	total, permanent total, temporary partial, permanent partial, or economic recovery 
45.6 	compensation benefits, in either periodic or lump sum payments from the employer 
45.7 	under applicable workers' compensation laws, after deduction of amount of attorney 
45.8 	fees, authorized under applicable workers' compensation laws, paid by a disabilitant. If 
45.9 	the total of the single life annuity actuarial equivalent disability benefit and the workers' 
45.10 	compensation benefit exceeds: (1) the salary the disabled member received as of the date 
45.11 	of the disability or (2) the salary currently payable for the same employment position or 
45.12 	an employment position substantially similar to the one the person held as of the date of 
45.13 	the disability, whichever is greater, the disability benefit must be reduced to that amount 
45.14 	which, when added to the workers' compensation benefits, does not exceed the greater of 
45.15 	the salaries described in clauses (1) and (2).
45.16 	(b) Permanent partial disability payments provided for in section 176.101, 
45.17 	subdivision 2a, and retraining payments provided for in section 176.102, subdivision 11, 
45.18 	must not be offset from disability payments due under paragraph (a) if the amounts of 
45.19 	the permanent partial or retraining payments are reported to the executive director in a 
45.20 	manner specified by the executive director.

45.21 	EFFECTIVE DATE. This section is effective the day following final enactment.

45.22 	Sec. 22. Minnesota Statutes 2006, section 353.64, subdivision 11, is amended to read:
45.23 		Subd. 11.Pension coverage for certain tribal police officers exercising state 
45.24 	arrest powers. (a) The governing body of a tribal police department which is exercising 
45.25 	state arrest powers under section 626.90, 626.91, 626.92, or 626.93 may request by 
45.26 	resolution to the executive director that its police officers be considered public employees 
45.27 	under section 353.01, subdivision 2, be considered a police officer under section 353.64, 
45.28 	subdivision 1, and become members of the public employees police and fire retirement 
45.29 	plan and that the tribal police department be considered a governmental subdivision under 
45.30 	section 353.01, subdivision 6. 
45.31 	(b) The executive director of the association must approve the request by a tribal 
45.32 	police department under paragraph (a) if a ruling made by the federal Internal Revenue 
45.33 	Service provides that:
45.34 	(1) the tribal police department is an agency or instrumentality of the state of 
45.35 	Minnesota for purposes of enforcing state law; and
46.1 	(2) contributions made by the tribal police department to a retirement plan on behalf 
46.2 	of employees of the tribal police department are contributions to a governmental plan 
46.3 	within the meaning of section 414(d) of the federal Internal Revenue Code.
46.4 	(c)(b) Following the approval of the request by the executive director, the head of 
46.5 	the police department or that person's designee must immediately report for membership in 
46.6 	the police and fire fund a person who is employed as a full-time or part-time police officer 
46.7 	in a position that meets the conditions in sections 353.01, subdivision 2a, and 353.64, 
46.8 	subdivisions 1 and 2. The police department head or that person's designee must deduct 
46.9 	the employee contributions from the salary of each eligible police officer as required by 
46.10 	section 353.65, subdivision 2, and make the employer contributions required by section 
46.11 	353.65, subdivision 3. The head of the police department or that person's designee must 
46.12 	meet the reporting requirements in section 353.65, subdivision 4. 

46.13 	EFFECTIVE DATE. This section is effective the day following final enactment.

46.14 	Sec. 23. Minnesota Statutes 2006, section 353.656, subdivision 2, is amended to read:
46.15 		Subd. 2.Benefits paid under workers' compensation law. (a) If a member, as 
46.16 	described in subdivision 1, is injured under circumstances which entitle the member to 
46.17 	receive benefits under the workers' compensation law, the member shall receive the same 
46.18 	benefits as provided in subdivision 1, with disability benefits paid reimbursed and future 
46.19 	benefits reduced by all periodic or lump sum amounts, other than those amounts excluded 
46.20 	under paragraph (b), paid to the member under the workers' compensation law, after 
46.21 	deduction of amount of attorney fees, authorized under applicable workers' compensation 
46.22 	laws, paid by a disabilitant if the total of the single life annuity actuarial equivalent 
46.23 	disability benefit and the workers' compensation benefit exceeds: (1) the salary the 
46.24 	disabled member received as of the date of the disability or (2) the salary currently payable 
46.25 	for the same employment position or an employment position substantially similar to the 
46.26 	one the person held as of the date of the disability, whichever is greater. The disability 
46.27 	benefit must be reduced to that amount which, when added to the workers' compensation 
46.28 	benefits, does not exceed the greater of the salaries described in clauses (1) and (2).
46.29 	(b) Permanent partial disability payments provided for in section 176.101, 
46.30 	subdivision 2a, and retraining payments provided for in section 176.102, subdivision 11, 
46.31 	must not be offset from disability payments due under paragraph (a) if the amounts of 
46.32 	the permanent partial or retraining payments are reported to the executive director in a 
46.33 	manner specified by the executive director.

46.34 	EFFECTIVE DATE. This section is effective the day following final enactment.

47.1 	Sec. 24. Minnesota Statutes 2006, section 353D.05, subdivision 2, is amended to read:
47.2 		Subd. 2.Investment options. (a) A participant may elect to purchase shares in 
47.3 	the income share account, the growth share account, the international share account, 
47.4 	the money market account, the bond market account, the fixed interest account, or the 
47.5 	common stock index account established by section 11A.17, or a combination of those 
47.6 	accounts. The participant may elect to purchase shares in a combination of those accounts 
47.7 	by specifying the percentage of the total contributions to be used to purchase shares in 
47.8 	each of the accounts. 
47.9 	(b) A participant or a former participant may indicate in writing a choice of options 
47.10 	for subsequent purchases of shares. After a choice is made, until the participant or former 
47.11 	participant makes a different written indication, the executive director of the association 
47.12 	shall purchase shares in the supplemental investment account or accounts specified by 
47.13 	the participant. If no initial option is indicated by a participant or the specifications made 
47.14 	by the participant exceeds 100 percent to be invested in more than one account, the 
47.15 	executive director shall invest all contributions made by or on behalf of a participant in 
47.16 	the income share account. If the specifications are less than 100 percent, the executive 
47.17 	director shall invest the remaining percentage in the income share account. A choice of 
47.18 	investment options is effective the first of the month following the date of receipt of the 
47.19 	signed written choice of options.
47.20 	(c) Shares in the fixed interest account attributable to any guaranteed investment 
47.21 	contract as of July 1, 1994, may not be withdrawn from the fund or transferred to another 
47.22 	account until the guaranteed investment contract has expired, unless the participant 
47.23 	qualifies for a benefit payment under section 353D.07. 
47.24 	(d) A participant or former participant may also change the investment options 
47.25 	selected for all or a portion of the individual's previously purchased shares in accounts, 
47.26 	subject to the provisions of paragraph (c) concerning the fixed interest account. A change 
47.27 	under this paragraph is effective the first of the month following the date of receipt of a 
47.28 	signed written choice of options.
47.29 	(e) The change or selection of an investment option or the transfer of all or a portion 
47.30 	of the deceased or former participant's shares in the income share, growth share, common 
47.31 	stock index, bond market, international share, money market, or fixed interest accounts 
47.32 	must not be made following death of the participant or former participant.

47.33 	EFFECTIVE DATE. This section is effective the day following final enactment.

47.34 	Sec. 25. [353D.071] FEDERAL COMPLIANCE.
48.1 		Subdivision 1.Definitions. (a) For purposes of this section, the following terms 
48.2 	have the meanings given them.
48.3 	(b) "Designated beneficiary" means the person designated as the beneficiary under 
48.4 	section 353D.07, subdivision 5, and who is the designated beneficiary under section 
48.5 	401(a)(9) of the Internal Revenue Code and section 1.401(a)(9)-1, Q&A-4 of the Treasury 
48.6 	regulations.
48.7 	(c) "Distribution calendar year" means a calendar year for which a minimum 
48.8 	distribution is required. For distributions beginning before the member's death, the first 
48.9 	distribution calendar year is the calendar year immediately preceding the calendar year 
48.10 	which contains the member's required beginning date. For distributions beginning after 
48.11 	the member's death, the first distribution calendar year is the calendar year in which 
48.12 	distributions are required to begin under subdivision 2, paragraph (c). The required 
48.13 	minimum distribution for the member's first distribution calendar year shall be made on or 
48.14 	before the member's required beginning date. 
48.15 	(d) "Member's account balance" means the account balance as of the last valuation 
48.16 	date in the valuation calendar year increased by the amount of any contributions made 
48.17 	and allocated to the account balance as of dates in the valuation calendar year after the 
48.18 	valuation date and decreased by distributions made in the valuation calendar year after 
48.19 	the valuation date. The account balance for the valuation calendar year includes any 
48.20 	amounts rolled over or transferred to the plan either in the valuation calendar year or in the 
48.21 	distribution calendar year if distributed or transferred in the valuation calendar year.
48.22 	(e) "Required beginning date" means the later of April 1 of the calendar year 
48.23 	following the calendar year that the member attains age 70 years, six months, or April 
48.24 	1 of the calendar year following the calendar year in which the member terminates 
48.25 	employment.
48.26 	(f) "Valuation calendar year" means the calendar year immediately preceding the 
48.27 	distribution calendar year.
48.28 		Subd. 2.Required minimum distributions. (a) The provisions of this subdivision 
48.29 	shall apply for purposes of determining required minimum distributions for calendar years 
48.30 	beginning with the 2003 calendar year and will take precedence over any inconsistent 
48.31 	provisions of the plan. All distributions required under this section will be determined and 
48.32 	made in accordance with the treasury regulations under section 401(a)(9) of the Internal 
48.33 	Revenue Code, including regulations providing special rules for governmental plans, as 
48.34 	defined under section 414(d) of the Internal Revenue Code, that comply with a reasonable 
48.35 	good faith interpretation of the minimum distribution requirements.
49.1 	(b) The member's entire interest will be distributed to the member in a lump sum no 
49.2 	later than the member's required beginning date.
49.3 	(c) If the member dies before the required minimum distribution is made, the 
49.4 	member's entire interest will be distributed in a lump sum no later than as follows:
49.5 	(1) if the member's surviving spouse is the member's sole designated beneficiary, the 
49.6 	distribution must be made by December 31 of the calendar year immediately following the 
49.7 	calendar year in which the member died, or by December 31 of the calendar year in which 
49.8 	the member would have attained age 70 years, six months, whichever is later;
49.9 	(2) if the member's surviving spouse is not the member's sole beneficiary, or if 
49.10 	there is no designated beneficiary as of September 30 of the year following the year of 
49.11 	the member's death, the member's entire interest shall be distributed by December 31 
49.12 	of the calendar year containing the fifth anniversary of the member's death as directed 
49.13 	under section 353D.07, subdivision 5; or
49.14 	(3) if the member's surviving spouse is the member's sole designated beneficiary and 
49.15 	the surviving spouse dies after the member, but before the account balance is distributed 
49.16 	to the surviving spouse, paragraph (c), clause (2), shall apply as if the surviving spouse 
49.17 	were the member.
49.18 	(d) For purposes of paragraph (c), unless clause (3) applies, distributions are 
49.19 	considered to be made on the member's required beginning date. If paragraph (c), clause 
49.20 	(3), applies, distributions are considered to begin on the date distributions are required to 
49.21 	be made to the surviving spouse under paragraph (c), clause (1).

49.22 	EFFECTIVE DATE. This section is effective the day following final enactment.

49.23 	Sec. 26. Minnesota Statutes 2007 Supplement, section 353F.02, subdivision 4, is 
49.24 	amended to read:
49.25 		Subd. 4.Medical facility. "Medical facility" means:
49.26 	(1) Bridges Medical Services;
49.27 	(2) the City of Cannon Falls Hospital;
49.28 	(3) Clearwater County Memorial Hospital doing business as Clearwater Health 
49.29 	Services in Bagley;
49.30 	(4) the Dassel Lakeside Community Home;
49.31 	(5) the Fair Oaks Lodge, Wadena;
49.32 	(6) the Glencoe Area Health Center;
49.33 	(7) the Hutchinson Area Health Care;
49.34 	(8) the Kanabec Hospital;
49.35 	(9) the Lakefield Nursing Home;
50.1 	(10)(9) the Lakeview Nursing Home in Gaylord;
50.2 	(11)(10) the Luverne Public Hospital;
50.3 	(12) the Northfield Hospital;
50.4 	(13)(11) the Oakland Park Nursing Home;
50.5 	(14)(12) the RenVilla Nursing Home;
50.6 	(15) the Renville County Hospital in Olivia;
50.7 	(16)(13) the St. Peter Community Healthcare Center; and
50.8 	(17)(14) the Waconia-Ridgeview Medical Center.

50.9 	EFFECTIVE DATE. This section is effective the day following final enactment.

50.10 	Sec. 27. [353F.025] CERTIFICATION AND DECERTIFICATION OF MEDICAL 
50.11 	FACILITIES AND OTHER PUBLIC EMPLOYING UNITS.
50.12 		Subdivision 1.Eligibility determination. (a) The chief clerical officer of a 
50.13 	governmental subdivision may submit a resolution from the governing body to the 
50.14 	executive director of the Public Employees Retirement Association which supports 
50.15 	providing coverage under this chapter for employees of that governmental subdivision 
50.16 	who are privatized, and which states that the governing body will pay for actuarial 
50.17 	calculations, as further specified in paragraph (c). 
50.18 	(b) The governing body must also provide a copy of any applicable purchase or 
50.19 	lease agreement and any other information requested by the executive director to allow the 
50.20 	executive director to verify that under the proposed employer change, the new employer 
50.21 	does not qualify as a governmental subdivision under section 353.01, subdivision 6, 
50.22 	making the employees ineligible for continued coverage as active members of the general 
50.23 	employees retirement plan of the Public Employees Retirement Association.
50.24 	(c) Following receipt of a resolution and a determination by the executive director 
50.25 	that the new employer is not a governmental subdivision, the executive director shall 
50.26 	direct the consulting actuary retained under section 356.214 to determine whether the 
50.27 	general employees retirement plan of the Public Employees Retirement Association is 
50.28 	expected to receive a net gain if privatization occurs, by determining whether the actuarial 
50.29 	liability of the special benefit coverage provided under this chapter, if extended to the 
50.30 	applicable employees under the privatization, is less than the actuarial gain otherwise to 
50.31 	accrue to the plan. The date of the actuarial calculations used to make this determination 
50.32 	must be within one year of the effective date, as defined in section 353F.02, subdivision 3.
50.33 		Subd. 2.Recommendation to legislature. (a) If the actuarial calculations under 
50.34 	subdivision 1, paragraph (c), indicate that a net gain to the general employees retirement 
50.35 	plan of the Public Employees Retirement Association is expected due to the privatization, 
51.1 	the executive director shall forward a recommendation and supporting documentation to 
51.2 	the chair of the Legislative Commission on Pensions and Retirement, the chair of the 
51.3 	Governmental Operations, Reform, Technology and Elections Committee of the house of 
51.4 	representatives, the chair of the State and Local Government Operations and Oversight 
51.5 	Committee of the senate, and the executive director of the Legislative Commission on 
51.6 	Pensions and Retirement. The recommendation must be in the form of an addition to 
51.7 	the definition of "medical facility" under section 353F.02, subdivision 4, or to "other 
51.8 	public employing unit" under section 353F.02, subdivision 5, whichever is applicable. 
51.9 	The recommendation must be forwarded to the legislature before January 15 for the 
51.10 	recommendation to be considered in that year's legislative session.
51.11 	(b) If a medical facility or other public employing unit listed under section 353F.02, 
51.12 	subdivision 4 or 5, fails to privatize within one year of the final enactment date of the 
51.13 	legislation adding the entity to the applicable definition, its inclusion under this chapter 
51.14 	is voided, and the executive director shall include in the proposed legislation under 
51.15 	paragraph (a) a recommendation that the applicable entity be stricken from the definition.
51.16 		Subd. 3.Date of application. For any privatization added to this chapter after the 
51.17 	effective date of this section, the first date of coverage is the effective date as defined in 
51.18 	section 353F.02, subdivision 3.

51.19 	EFFECTIVE DATE. This section is effective the day following final enactment.

51.20 	Sec. 28. Minnesota Statutes 2007 Supplement, section 354.096, subdivision 2, is 
51.21 	amended to read:
51.22 		Subd. 2.Payment. (a) Notwithstanding any laws to the contrary, a member who 
51.23 	is granted a family leave under United States Code, title 42, section 12631, may receive 
51.24 	allowable service credit for the leave by making payment of the employee, employer, and 
51.25 	additional employer contributions at the rates under section 354.42, during the leave 
51.26 	period as applied to the member's average full-time monthly salary rate on the date the 
51.27 	leave commenced under section 354.72. 
51.28 	(b) If payment is made after the leave terminates, section 354.72 applies.

51.29 	EFFECTIVE DATE. This section is effective July 1, 2008.

51.30 	Sec. 29. Minnesota Statutes 2006, section 354.33, subdivision 5, is amended to read:
51.31 		Subd. 5.Retirees not eligible for federal benefits. Notwithstanding the provisions 
51.32 	of section 354.55, subdivision 3, When any person retires after July 1, 1973, who (1) 
51.33 	has ten or more years of allowable service, and (2) does not have any retroactive Social 
52.1 	Security coverage by reason of the person's position in the retirement system, and (3) does 
52.2 	not qualify for federal old age and survivor primary benefits at the time of retirement, the 
52.3 	annuity must be computed under section 354.44, subdivision 2, of the law in effect on 
52.4 	June 30, 1969, except that accumulations after June 30, 1957, must be calculated using the 
52.5 	same mortality table and interest assumption as are used to transfer the required reserves 
52.6 	to the Minnesota postretirement investment fund.

52.7 	EFFECTIVE DATE. This section is effective the day following final enactment.

52.8 	Sec. 30. Minnesota Statutes 2007 Supplement, section 354.72, subdivision 2, is 
52.9 	amended to read:
52.10 		Subd. 2.Purchase procedure. (a) A teacher may purchase credit for allowable and 
52.11 	formula service in the plan for a period specified in subdivision 1 if the teacher makes a 
52.12 	payment as specified in paragraph (b) or, (c), or (d), whichever applies. The employing 
52.13 	unit, at its option, may pay the employer portion of the amount specified in paragraph (b)
52.14 	on behalf of its employees.
52.15 	(b) If payment is received by the executive director within one year from the end
52.16 	by June 30 of the fiscal year of the strike period or authorized leave included under section 
52.17 	354.093, 354.095, or 354.096, orpayment must equal the total employee and employer 
52.18 	contribution rates, including amortization contribution rates if applicable, multiplied by the 
52.19 	member's average monthly salary rate on the date the leave or strike period commenced, 
52.20 	or for an extended leave under section 354.094, on the salary received during the year 
52.21 	immediately preceding the initial year of the leave, multiplied by the months and portions 
52.22 	of a month of the leave or strike period for which the teacher seeks allowable service credit.
52.23 	(c) If payment is made after June 30 and before the following June 30 for a strike 
52.24 	period or for leaves of absence under section 354.093, 354.095, or 354.096, or for an 
52.25 	extended leave of absence under section 354.094, the payment must equal the total 
52.26 	employee and employer contributions, including amortization contributions if applicable, 
52.27 	given the contribution rates in section 354.42, multiplied by the member's average 
52.28 	monthly salary rate on the commencement of the leave or period of strike, multiplied by 
52.29 	the months and portions of a month of the leave of absence or period of strike for which 
52.30 	the teacher seeks allowable service credit. Payments made under this paragraph must 
52.31 	include  the amount determined in paragraph (b) plus compound interest at a monthly rate 
52.32 	of 0.71 percent from the last day of the leave period or strike period, or from June 30 for 
52.33 	an extended leave of absence under section 354.094, until the last day of the month in 
52.34 	which payment is received.
53.1 	(c)(d) If payment is received by the executive director after the applicable last 
53.2 	permitted date under paragraph (b) (c), the payment amount is the amount determined 
53.3 	under  section 356.551. Notwithstanding payment deadlines specified in section 356.551, 
53.4 	payment under this section may be made anytime before the effective date of retirement.

53.5 	EFFECTIVE DATE. This section is effective retroactively from July 1, 2007.

53.6 	Sec. 31. Minnesota Statutes 2006, section 356.47, subdivision 3, is amended to read:
53.7 		Subd. 3.Payment. (a) Upon the retired member attaining the age of 65 years 
53.8 	or upon the first day of the month next following the month occurringBeginning one 
53.9 	year after the termination of the reemployment withholding period ends relating to the 
53.10 	reemployment that gave rise to the limitation, whichever is later, and the filing of a written 
53.11 	application, the retired member is entitled to the payment, in a lump sum, of the value 
53.12 	of the person's amount under subdivision 2, plus interest at the compound annual rate 
53.13 	of six percent from the date that the amount was deducted from the retirement annuity 
53.14 	to the date of payment.
53.15 	(b) The written application must be on a form prescribed by the chief administrative 
53.16 	officer of the applicable retirement plan.
53.17 	(c) If the retired member dies before the payment provided for in paragraph (a) is 
53.18 	made, the amount is payable, upon written application, to the deceased person's surviving 
53.19 	spouse, or if none, to the deceased person's designated beneficiary, or if none, to the 
53.20 	deceased person's estate.
53.21 	(d) In lieu of the direct payment of the person's amount under subdivision 2, on 
53.22 	or after the payment date under paragraph (a), if the federal Internal Revenue Code so 
53.23 	permits, the retired member may elect to have all or any portion of the payment amount 
53.24 	under this section paid in the form of a direct rollover to an eligible retirement plan as 
53.25 	defined in section 402(c) of the federal Internal Revenue Code that is specified by the 
53.26 	retired member. If the retired member dies with a balance remaining payable under this 
53.27 	section, the surviving spouse of the retired member, or if none, the deceased person's 
53.28 	designated beneficiary, or if none, the administrator of the deceased person's estate may 
53.29 	elect a direct rollover under this paragraph.

53.30 	EFFECTIVE DATE. This section is effective retroactively from January 1, 2008.

53.31 	Sec. 32. Minnesota Statutes 2006, section 356.551, subdivision 2, is amended to read:
53.32 		Subd. 2.Determination. (a) Unless the minimum purchase amount set forth in 
53.33 	paragraph (c) applies, the prior service credit purchase amount is an amount equal to the 
54.1 	actuarial present value, on the date of payment, as calculated by the chief administrative 
54.2 	officer of the pension plan and reviewed by the actuary retained under section 356.214, 
54.3 	of the amount of the additional retirement annuity obtained by the acquisition of the 
54.4 	additional service credit in this section.
54.5 	(b) Calculation of this amount must be made using the preretirement interest rate 
54.6 	applicable to the public pension plan specified in section 356.215, subdivision 8, and 
54.7 	the mortality table adopted for the public pension plan. The calculation must assume 
54.8 	continuous future service in the public pension plan until, and retirement at, the age at 
54.9 	which the minimum requirements of the fund for normal retirement or retirement with an 
54.10 	annuity unreduced for retirement at an early age, including section 356.30, are met with 
54.11 	the additional service credit purchased. The calculation must also assume a full-time 
54.12 	equivalent salary, or actual salary, whichever is greater, and a future salary history that 
54.13 	includes annual salary increases at the applicable salary increase rate for the plan specified 
54.14 	in section 356.215, subdivision 4d.
54.15 	(c) The prior service credit purchase amount may not be less than the amount 
54.16 	determined by applying the current employee or member contribution rate, the employer 
54.17 	contribution rate, and the additional employer contribution rate, if any, to the person's 
54.18 	current annual salary and multiplying that result by the number of whole and fraction 
54.19 	years of service to be purchased.
54.20 	(c) The prior service credit purchase amount may not be less than the amount 
54.21 	determined by applying, for each year or fraction of a year being purchased, the sum of the 
54.22 	employee contribution rate, the employer contribution rate, and the additional employer 
54.23 	contribution rate, if any, applicable during that period, to the person's annual salary during 
54.24 	that period, or fractional portion of a year's salary, if applicable, plus interest at the annual 
54.25 	rate of 8.5 percent compounded annually from the end of the year in which contributions 
54.26 	would otherwise have been made to the date on which the payment is received.
54.27 	(d) Unless otherwise provided by statutes governing a specific plan, payment must 
54.28 	be made in one lump sum within one year of the prior service credit authorization or prior 
54.29 	to the member's effective date of retirement, whichever is earlier. Payment of the amount 
54.30 	calculated under this section must be made by the applicable eligible person.
54.31 	(e) However, the current employer or the prior employer may, at its discretion, pay 
54.32 	all or any portion of the payment amount that exceeds an amount equal to the employee 
54.33 	contribution rates in effect during the period or periods of prior service applied to the 
54.34 	actual salary rates in effect during the period or periods of prior service, plus interest at the 
54.35 	rate of 8.5 percent a year compounded annually from the date on which the contributions 
54.36 	would otherwise have been made to the date on which the payment is made. If the 
55.1 	employer agrees to payments under this subdivision, the purchaser must make the 
55.2 	employee payments required under this subdivision within 90 days of the prior service 
55.3 	credit authorization. If that employee payment is made, the employer payment under this 
55.4 	subdivision must be remitted to the chief administrative officer of the public pension plan 
55.5 	within 60 days of receipt by the chief administrative officer of the employee payments 
55.6 	specified under this subdivision.

55.7 	EFFECTIVE DATE. This section is effective the day following final enactment.

55.8 	Sec. 33. Minnesota Statutes 2006, section 356.611, subdivision 2, is amended to read:
55.9 		Subd. 2.Federal compensation limits. (a) For members of a covered pension plan 
55.10 	enumerated in section 356.30, subdivision 3, and of the plan established under chapter 
55.11 	353D, compensation in excess of the limitation specified in section 401(a)(17) of the 
55.12 	Internal Revenue Code, as amended, for changes in the cost of living under section 
55.13 	401(a)(17)(B) of the Internal Revenue Code, may not be included for contribution and 
55.14 	benefit computation purposes. 
55.15 	(b) Notwithstanding paragraph (a), for members specified in paragraph (a) who first 
55.16 	contributed to a covered plan specified in that paragraph before July 1, 1995, the annual 
55.17 	compensation limit specified in Internal Revenue Code 401(a)(17) on June 30, 1993, 
55.18 	applies if that provides a greater allowable annual compensation.

55.19 	EFFECTIVE DATE. This section is effective the day following final enactment.

55.20 	Sec. 34. Minnesota Statutes 2006, section 356.611, is amended by adding a subdivision 
55.21 	to read:
55.22 		Subd. 3a.Maximum annual addition limitation. The annual additions on behalf 
55.23 	of a member to the plan established under chapter 352D or 353D for any limitation year 
55.24 	beginning after December 31, 2001, shall not exceed the lesser of one hundred percent 
55.25 	of the member's compensation, as defined for purposes of section 415(c) of the Internal 
55.26 	Revenue Code; or $40,000, as adjusted by the United States secretary of the treasury under 
55.27 	section 415(d) of the Internal Revenue Code.

55.28 	EFFECTIVE DATE. This section is effective the day following final enactment.

55.29 	Sec. 35. Laws 2002, chapter 392, article 2, section 4, is amended to read:
55.30 	Sec. 4. EFFECTIVE DATE.
 55.31 	(a) Sections 1, 2, and 3 are effective retroactive to July 1, 2001. 
56.1 	(b) The authority to obtain credit for allowable service under section 1, clause (11); 
56.2 	and section 2, paragraph (a), clause (8); and section 3, clause (9), expires 12 months 
56.3 	after the date of enactment.

56.4 	EFFECTIVE DATE. This section is effective retroactively without interruption 
56.5 	from July 1, 2002.

56.6 	Sec. 36. Laws 2006, chapter 271, article 5, section 5, is amended to read:
56.7 	Sec. 5. EFFECTIVE DATE.
 56.8 	(a) Sections 1, 3, and 4 are effective the day following final enactment and section 3 
56.9 	has effect retroactively from July 25, 2005. 
56.10 	(b) Section 2 with respect to the Cannon Falls Hospital District is effective upon the 
56.11 	latter of: 
56.12 	(1) the day after the governing body of the Cannon Falls Hospital District and its 
56.13 	chief clerical officer meet the requirements under Minnesota Statutes, section 645.021, 
56.14 	subdivisions 2 and 3; and 
56.15 	(2) the first day of the month following certification to the Cannon Falls Hospital 
56.16 	District by the executive director of the Public Employees Retirement Association that the 
56.17 	actuarial accrued liability of the special benefit coverage proposed for extension to the 
56.18 	privatized City of Cannon Falls Hospital employees under section 1 does not exceed the 
56.19 	actuarial gain otherwise to be accrued by the Public Employees Retirement Association, as 
56.20 	calculated by the consulting actuary retained under Minnesota Statutes, section 356.214. 
56.21 	The cost of the actuarial calculations must be borne by the current employer or by the 
56.22 	entity which is the employer following the privatization. 
56.23 	(c) Section 2, with respect to Clearwater County Memorial Hospital, is effective 
56.24 	upon the latter of: 
56.25 	(1) the day after the governing body of Clearwater County and its chief clerical 
56.26 	officer meet the requirements under Minnesota Statutes, section 645.021, subdivisions 2
56.27 	and 3, except that the certificate of approval must be filed before January 1, 2009; and 
56.28 	(2) the first day of the month following certification to Clearwater County by the 
56.29 	executive director of the Public Employees Retirement Association that the actuarial 
56.30 	accrued liability of the special benefit coverage proposed for extension to the privatized 
56.31 	Clearwater Health Services employees under section 2 does not exceed the actuarial gain 
56.32 	otherwise to be accrued by the Public Employees Retirement Association, as calculated by 
56.33 	the consulting actuary retained under Minnesota Statutes, section 356.214. The cost of 
56.34 	the actuarial calculations must be borne by the current employer or by the entity which is 
56.35 	the employer following the privatization. 
57.1 	(d) Section 2 with respect to the Dassel Lakeside Community Home is effective 
57.2 	upon the latter of: 
57.3 	(1) the day after the governing body of the city of Dassel and its chief clerical officer 
57.4 	timely complete compliance with Minnesota Statutes, section 645.021, subdivisions 2
57.5 	and 3; and 
57.6 	(2) the first day of the month next following certification to the Dassel City 
57.7 	Council by the executive director of the Public Employees Retirement Association that 
57.8 	the actuarial accrued liability of the special benefit coverage proposed for extension to 
57.9 	the privatized Dassel Lakeside Community Home employees under section 2 does not 
57.10 	exceed the actuarial gain otherwise to be accrued by the Public Employees Retirement 
57.11 	Association, as calculated by the consulting actuary retained under Minnesota Statutes, 
57.12 	section 356.214. The cost of the actuarial calculations must be borne by the city of Dassel 
57.13 	or by the entity which is the employer following the privatization.

57.14 	EFFECTIVE DATE. This section is effective the day following final enactment.

57.15 	Sec. 37.  REPEALER.
 57.16 	(a) Minnesota Statutes 2006, sections 354.44, subdivision 6a; 354.465; 354.51, 
57.17 	subdivision 4; and 354.55, subdivisions 2, 3, 6, 12, and 15, are repealed effective July 
57.18 	1, 2008.
57.19 	(b) Minnesota Statutes 2006, sections 354A.091, subdivisions 1a and 1b; and 
57.20 	355.629, are repealed effective July 1, 2008.
57.21 	(c) Laws 2005, First Special Session chapter 8, article 1, section 23, is repealed 
57.22 	retroactively from July 26, 2005.

57.23 	ARTICLE 6
57.24 	MSRS-CORRECTIONAL PLAN COVERAGE EXPANSION

57.25 	Section 1. Minnesota Statutes 2007 Supplement, section 352.91, subdivision 3d, 
57.26 	is amended to read:
57.27 		Subd. 3d.Other correctional personnel. (a) "Covered correctional service" means 
57.28 	service by a state employee in one of the employment positions at a correctional facility or 
57.29 	at the Minnesota Security Hospital specified in paragraph (b) if at least 75 percent of the 
57.30 	employee's working time is spent in direct contact with inmates or patients and the fact of 
57.31 	this direct contact is certified to the executive director by the appropriate commissioner.
57.32 	(b) The employment positions are as follows:
57.33 	(1) baker;
58.1 	(2) central services administrative specialist, intermediate;
58.2 	(3) central services administrative specialist, principal;
58.3 	(4) chaplain;
58.4 	(5) chief cook;
58.5 	(6) cook;
58.6 	(7) cook coordinator;
58.7 	(8) corrections program therapist 1;
58.8 	(9) corrections program therapist 2;
58.9 	(10) corrections program therapist 3;
58.10 	(11) corrections program therapist 4;
58.11 	(12) corrections inmate program coordinator;
58.12 	(13) corrections transitions program coordinator;
58.13 	(14) corrections security caseworker;
58.14 	(15) corrections security caseworker career;
58.15 	(16) corrections teaching assistant;
58.16 	(17) delivery van driver;
58.17 	(18) dentist;
58.18 	(19) electrician supervisor;
58.19 	(20) general maintenance worker lead;
58.20 	(21) general repair worker;
58.21 	(22) library/information research services specialist;
58.22 	(23) library/information research services specialist senior;
58.23 	(24) library technician;
58.24 	(25) painter lead;
58.25 	(26) plant maintenance engineer lead;
58.26 	(27) plumber supervisor;
58.27 	(28) psychologist 1;
58.28 	(29) psychologist 3;
58.29 	(30) recreation therapist;
58.30 	(31) recreation therapist coordinator;
58.31 	(32) recreation program assistant;
58.32 	(33) recreation therapist senior;
58.33 	(34) sports medicine specialist;
58.34 	(35) work therapy assistant;
58.35 	(36) work therapy program coordinator; and
58.36 	(37) work therapy technician.

59.1 	EFFECTIVE DATE. This section is effective the day following final enactment.

59.2 	Sec. 2. COVERAGE TRANSFER DATES.
 59.3 	(a) The coverage transfer under Minnesota Statutes, section 352.91, subdivision 3d, 
59.4 	paragraph (b), clause (20), also covers employment in that position after December 11, 
59.5 	2007, for purposes of Minnesota Statutes, section 352.955, subdivisions 1, 3, 4, 5, and 6.
59.6 	(b) The coverage change under Minnesota Statutes, section 352.91, subdivision 3d, 
59.7 	paragraph (b), clause (25), is prospective only.

59.8 	EFFECTIVE DATE. This section is effective the day following final enactment.

59.9 	ARTICLE 7
59.10 	MSRS-UNCLASSIFIED RETIREMENT PROGRAM CHANGES

59.11 	Section 1. Minnesota Statutes 2007 Supplement, section 352D.02, subdivision 1, 
59.12 	is amended to read:
59.13 		Subdivision 1.Coverage.  (a) Except as specified in paragraph (b), employees 
59.14 	enumerated in paragraph (c), clauses (2), (3), (4), (6) to (14), and (16) to (18), if they are 
59.15 	an elected official or in the unclassified service of the state or Metropolitan Council and 
59.16 	are eligible for coverage under the general state employees retirement plan under chapter 
59.17 	352, are participants in the unclassified program under this chapter unless the employee 
59.18 	gives notice to the executive director of the Minnesota State Retirement System within 
59.19 	one year following the commencement of employment in the unclassified service that the 
59.20 	employee desires coverage under the general state employees retirement plan. For the 
59.21 	purposes of this chapter, an employee who does not file notice with the executive director 
59.22 	is deemed to have exercised the option to participate in the unclassified program.
59.23 	(b) Persons referenced in paragraph (c), clause (5), are participants in the unclassified 
59.24 	program under this chapter unless the person was eligible to elect different coverage under 
59.25 	section 3A.07 and elected retirement coverage by the applicable alternative retirement 
59.26 	plan. Persons referenced in paragraph (c), clause (15), are participants in the unclassified 
59.27 	program under this chapter for judicial employment in excess of the service credit limit in 
59.28 	section 490.121, subdivision 22, and are not eligible for the choice of coverage specified 
59.29 	in paragraph (a).
59.30 	(c) Enumerated employees and referenced persons are:
59.31 	(1) the governor, the lieutenant governor, the secretary of state, the state auditor, 
59.32 	and the attorney general;
60.1 	(2) an employee in the Office of the Governor, Lieutenant Governor, Secretary 
60.2 	of State, State Auditor, Attorney General;
60.3 	(3) an employee of the State Board of Investment;
60.4 	(4) the head of a department, division, or agency created by statute in the unclassified 
60.5 	service, an acting department head subsequently appointed to the position, or an employee 
60.6 	enumerated in section 15A.0815 or 15A.083, subdivision 4;
60.7 	(5) a member of the legislature;
60.8 	(6) a full-time unclassified employee of the legislature or a commission or agency of 
60.9 	the legislature who is appointed without a limit on the duration of the employment or a 
60.10 	temporary legislative employee having shares in the supplemental retirement fund as a 
60.11 	result of former employment covered by this chapter, whether or not eligible for coverage 
60.12 	under the Minnesota State Retirement System;
60.13 	(7) a person who is employed in a position established under section 43A.08, 
60.14 	subdivision 1, clause (3), or in a position authorized under a statute creating or establishing 
60.15 	a department or agency of the state, which is at the deputy or assistant head of department 
60.16 	or agency or director level;
60.17 	(8) the regional administrator, or executive director of the Metropolitan Council, 
60.18 	general counsel, division directors, operations managers, and other positions as designated 
60.19 	by the council, all of which may not exceed 27 positions at the council and the chair;
60.20 	(9) the executive director, associate executive director, and not to exceed nine 
60.21 	positions of the Minnesota Office of Higher Education in the unclassified service, as 
60.22 	designated by the Minnesota Office of Higher Education before January 1, 1992, or 
60.23 	subsequently redesignated with the approval of the board of directors of the Minnesota 
60.24 	State Retirement System, unless the person has elected coverage by the individual 
60.25 	retirement account plan under chapter 354B;
60.26 	(10) the clerk of the appellate courts appointed under article VI, section 2, of the 
60.27 	Constitution of the state of Minnesota, the state court administrator and judicial district 
60.28 	administrators;
60.29 	(11) the chief executive officers of correctional facilities operated by the Department 
60.30 	of Corrections and of hospitals and nursing homes operated by the Department of Human 
60.31 	Services;
60.32 	(12) an employee whose principal employment is at the state ceremonial house;
60.33 	(13) an employee of the Agricultural Utilization Research Institute;
60.34 	(14) an employee of the State Lottery who is covered by the managerial plan 
60.35 	established under section 43A.18, subdivision 3; 
61.1 	(15) a judge who has exceeded the service credit limit in section 490.121, 
61.2 	subdivision 22;
61.3 	(16) an employee of Minnesota Technology Incorporated;
61.4 	(17) a person employed by the Minnesota State Colleges and Universities as faculty 
61.5 	or in an eligible unclassified administrative position as defined in section 354B.20, 
61.6 	subdivision 6, who was employed by the former state university or the former community 
61.7 	college system before May 1, 1995, and elected unclassified program coverage prior to 
61.8 	May 1, 1995; and
61.9 	(18) a person employed by the Minnesota State Colleges and Universities who 
61.10 	was employed in state service before July 1, 1995, who subsequently is employed in an 
61.11 	eligible unclassified administrative position as defined in section 354B.20, subdivision 
61.12 	6, and who elects coverage by the unclassified program.

61.13 	EFFECTIVE DATE. This section is effective January 6, 2009.

61.14 	Sec. 2. Minnesota Statutes 2007 Supplement, section 352D.02, subdivision 3, is 
61.15 	amended to read:
61.16 		Subd. 3.Transfer to general plan. (a) An employee, other than a judge as 
61.17 	specified in subdivision 1, paragraph (c), clause (15), credited with employee shares in the 
61.18 	unclassified program, after acquiring credit for ten years of allowable service and not later 
61.19 	than one month following the termination of covered employment, may elect to terminate 
61.20 	participation in the unclassified program and be covered by the general plan by filing a 
61.21 	written election with the executive director. The executive director shall then redeem the 
61.22 	employee's total shares and shall credit to the employee's account in the general plan the 
61.23 	amount of contributions that would have been so credited had the employee been covered 
61.24 	by the general plan during the employee's entire covered employment or elective state 
61.25 	service. The balance of money so redeemed and not credited to the employee's account 
61.26 	shall be transferred to the general plan retirement fund, except that (1) the employee 
61.27 	contribution paid to the unclassified program must be compared to (2) the employee 
61.28 	contributions that would have been paid to the general plan for the comparable period, if 
61.29 	the individual had been covered by that plan. If clause (1) is greater than clause (2), the 
61.30 	difference must be refunded to the employee as provided in section 352.22. If clause (2) is 
61.31 	greater than clause (1), the difference must be paid by the employee within six months 
61.32 	of electing general plan coverage or before the effective date of the annuity, whichever 
61.33 	is sooner. 
61.34 	(b) An election under paragraph (a) to transfer coverage to the general plan is 
61.35 	irrevocable during any period of covered employment.

62.1 	EFFECTIVE DATE. This section is effective January 6, 2009.

62.2 	ARTICLE 8
62.3 	PERA BENEFITS FOLLOWING PRIVATIZATIONS

62.4 	Section 1. Minnesota Statutes 2007 Supplement, section 353F.02, subdivision 4, 
62.5 	is amended to read:
62.6 		Subd. 4.Medical facility. "Medical facility" means:
62.7 	(1) Bridges Medical Services;
62.8 	(2) the City of Cannon Falls Hospital;
62.9 	(3) Clearwater County Memorial Hospital doing business as Clearwater Health 
62.10 	Services in Bagley;
62.11 	(4) the Dassel Lakeside Community Home;
62.12 	(5) the Fair Oaks Lodge, Wadena;
62.13 	(6) the Glencoe Area Health Center;
62.14 	(7) the Hutchinson Area Health Care;
62.15 	(8) the Kanabec Hospital;
62.16 	(9) the Lakefield Nursing Home;
62.17 	(10) the Lakeview Nursing Home in Gaylord;
62.18 	(11) the Luverne Public Hospital;
62.19 	(12) the Northfield Hospital;
62.20 	(13) the Oakland Park Nursing Home;
62.21 	(14) the RenVilla Nursing Home;
62.22 	(15) the Renville County Hospital in Olivia;
62.23 	(16) the Rice Memorial Hospital in Willmar, with respect to the Department of 
62.24 	Radiology and the Department of Radiation/Oncology;
62.25 	(17) the St. Peter Community Healthcare Center; and
62.26 	(17)(18) the Waconia-Ridgeview Medical Center; and
62.27 	(19) the Worthington Regional Hospital.

62.28 	Sec. 2. EFFECTIVE DATE.
 62.29 	(a) Minnesota Statutes, section 353F.02, subdivision 4, clause (16), is effective the 
62.30 	day after the governing body of the city of Willmar and its chief clerical officer timely 
62.31 	comply with Minnesota Statutes, section 645.021, subdivisions 2 and 3.
62.32 	(b) Minnesota Statutes, section 353F.02, subdivision 4, clause (19), is effective the 
62.33 	day after the governing body of the city of Worthington and its chief clerical officer timely 
62.34 	comply with Minnesota Statutes, section 645.021, subdivisions 2 and 3.

63.1 	ARTICLE 9
63.2 	RETIREMENT RELATED STATE AID PROGRAMS

63.3 	Section 1. Minnesota Statutes 2006, section 354A.12, subdivision 3a, is amended to 
63.4 	read:
63.5 		Subd. 3a.Special direct state aid to first class city teachers retirement fund 
63.6 	associations. (a) In fiscal year 1998, The state shall pay $4,827,000 to the St. Paul 
63.7 	Teachers Retirement Fund Association, $17,954,000 to the Minneapolis Teachers 
63.8 	Retirement Fund Association, and $486,000 $346,000 to the Duluth Teachers Retirement 
63.9 	Fund Association. In each fiscal year after fiscal year 2006, these payments to the first 
63.10 	class city teachers retirement fund associations must be, $2,827,000 forto the St. Paul, 
63.11 	$12,954,000 to the Teachers Retirement Fund Association and, for the former Minneapolis 
63.12 	Teachers Retirement Fund Association, and $486,000 for Duluth $12,954,000 to the 
63.13 	Teachers Retirement Association.
63.14 	(b) The direct state aids under this subdivision are payable October 1 annually. The 
63.15 	commissioner of finance shall pay the direct state aid. The amount required under this 
63.16 	subdivision is appropriated annually from the general fund to the commissioner of finance.

63.17 	EFFECTIVE DATE. (a) This section is effective July 1, 2009.
63.18 	(b) The aid paid to the Teachers Retirement Association and to the St. Paul 
63.19 	Teachers Retirement Fund Association under Minnesota Statutes 2006, section 354A.12, 
63.20 	subdivision 3a, in fiscal year 2007 is ratified. $346,000 that was payable under Minnesota 
63.21 	Statutes 2006, section 354A.12, subdivision 3a, in fiscal year 2008, but remains unpaid as 
63.22 	of the date of enactment, is payable to the Teachers Retirement Association and $140,000 
63.23 	that was payable under Minnesota Statutes 2006, section 354A.12, subdivision 3a, in 
63.24 	fiscal year 2008, but remains unpaid as of the date of enactment, is payable to the St. 
63.25 	Paul Teachers Retirement Fund Association.

63.26 	Sec. 2. Minnesota Statutes 2007 Supplement, section 354A.12, subdivision 3c, is 
63.27 	amended to read:
63.28 		Subd. 3c.Termination of supplemental contributions and direct matching 
63.29 	and state aid. (a) The supplemental contributions payable to the Minneapolis Teachers 
63.30 	Retirement Fund Association by Special School District No. 1 and the city of Minneapolis 
63.31 	under section 423A.02, subdivision 3, must continue to be paid to the Teachers Retirement 
63.32 	Association and must continue until the current assets of the fund equal or exceed the 
63.33 	actuarial accrued liability of the fund as determined in the most recent actuarial report 
63.34 	for the fund by the actuary retained under section 356.214, or 2037, whichever occurs 
64.1 	earlier. The supplemental contributions payable to the St. Paul Teachers Retirement 
64.2 	Fund Association by Independent School District No. 625 under section 423A.02, 
64.3 	subdivision 3, or the direct state aidsaid under subdivision 3a to the St. Paul Teachers 
64.4 	Retirement Fund Association terminate at the end of the fiscal year in which the accrued 
64.5 	liability funding ratio for that fund, as determined in the most recent actuarial report for 
64.6 	that fund by the actuary retained under section 356.214, equals or exceeds the accrued 
64.7 	liability funding ratio for the Teachers Retirement Association, as determined in the most 
64.8 	recent actuarial report for the Teachers Retirement Association by the actuary retained 
64.9 	under section 356.214. 
64.10 	(b) If the state direct matching, state supplemental, or state aid is terminated for a 
64.11 	first class city teachers retirement fund association under paragraph (a), it may not again 
64.12 	be received by that fund.
64.13 	(c) If the St. Paul Teachers Retirement Fund Association is funded at an amount 
64.14 	equal to or greater than the funding ratio applicable to the Teachers Retirement Association 
64.15 	when the provisions of paragraph (b) become effective, then any future state aid previously 
64.16 	distributed to that association must be immediately transferredunder subdivision 3a is 
64.17 	payable to the Teachers Retirement Association.

64.18 	EFFECTIVE DATE. This section is effective the day following final enactment and 
64.19 	applies retroactively to direct state aid paid or payable during fiscal years 2007 and 2008.

64.20 	Sec. 3. Minnesota Statutes 2006, section 423A.02, subdivision 1b, is amended to read:
64.21 		Subd. 1b.Additional amortization state aid. (a) Annually, on October 1, the 
64.22 	commissioner of revenue shall allocate the additional amortization state aid transferred 
64.23 	under section 69.021, subdivision 11, to: 
64.24 	(1) all police or salaried firefighters relief associations governed by and in full 
64.25 	compliance with the requirements of section 69.77, that had an unfunded actuarial accrued 
64.26 	liability in the actuarial valuation prepared under sections 356.215 and 356.216 as of the 
64.27 	preceding December 31; 
64.28 	(2) all local police or salaried firefighter consolidation accounts governed by chapter 
64.29 	353A that are certified by the executive director of the public employees retirement 
64.30 	association as having for the current fiscal year an additional municipal contribution 
64.31 	amount under section 353A.09, subdivision 5, paragraph (b), and that have implemented 
64.32 	section 353A.083, subdivision 1, if the effective date of the consolidation preceded May 
64.33 	24, 1993, and that have implemented section 353A.083, subdivision 2, if the effective date 
64.34 	of the consolidation preceded June 1, 1995; and 
65.1 	(3) the municipalities that are required to make an additional municipal contribution 
65.2 	under section 353.665, subdivision 8, for the duration of the required additional 
65.3 	contribution. 
65.4 	(b) The commissioner shall allocate the state aid on the basis of the proportional share 
65.5 	of the relief association or consolidation account of the total unfunded actuarial accrued 
65.6 	liability of all recipient relief associations and consolidation accounts as of December 31, 
65.7 	1993, for relief associations, and as of June 30, 1994, for consolidation accounts.
65.8 	(c) Beginning October 1, 2000, and annually thereafter, the commissioner shall 
65.9 	allocate the state aid, including any state aid in excess of the limitation in subdivision 
65.10 	4, on the following basis:
65.11 	(1) 64.5 percent to the municipalities to which section 353.665, subdivision 
65.12 	8, paragraph (b), or 353A.09, subdivision 5, paragraph (b), apply for distribution in 
65.13 	accordance with paragraph (b) and subject to the limitation in subdivision 4; 
65.14 	(2) 34.2 percent to the city of Minneapolis to fund any unfunded actuarial accrued 
65.15 	liability in the actuarial valuation prepared under sections 356.215 and 356.216 as of the 
65.16 	preceding December 31 for the Minneapolis Police Relief Association or the Minneapolis 
65.17 	Fire Department Relief Association; and 
65.18 	(3) 1.3 percent to the city of Virginia to fund any unfunded actuarial accrued liability 
65.19 	in the actuarial valuation prepared under sections 356.215 and 356.216 as of the preceding 
65.20 	December 31 for the Virginia Fire Department Relief Association. 
65.21 	If there is no unfunded actuarial accrued liability in both the Minneapolis Police 
65.22 	Relief Association and the Minneapolis Fire Department Relief Association as disclosed 
65.23 	in the most recent actuarial valuations for the relief associations prepared under sections 
65.24 	356.215 and 356.216, the commissioner shall allocate that 34.2 percent of the aid as 
65.25 	follows: 49 percent to the Teachers Retirement Association, 21 percent to the St. Paul 
65.26 	Teachers Retirement Fund Association, and 30 percent as additional funding to support 
65.27 	minimum fire state aid for volunteer firefighters relief associations. If there is no unfunded 
65.28 	actuarial accrued liability in the Virginia Fire Department Relief Association as disclosed 
65.29 	in the most recent actuarial valuation for the relief association prepared under sections 
65.30 	356.215 and 356.216, the commissioner shall allocate that 1.3 percent of the aid as 
65.31 	follows: 49 percent to the Teachers Retirement Association, 21 percent to the St. Paul 
65.32 	Teachers Retirement Fund Association, and 30 percent as additional funding to support 
65.33 	minimum fire state aid for volunteer firefighters relief associations. Upon the final 
65.34 	payment to municipalities required by section 353.665, subdivision 8, paragraph (b), 
65.35 	or 353A.09, subdivision 5, paragraph (b), the commissioner shall allocate that 64.5 
65.36 	percent of the aid as follows: 20 percent to the St. Paul Teachers Retirement Fund 
66.1 	Association, 20 percent to the city of Minneapolis to fund any unfunded actuarial accrued 
66.2 	liability in the actuarial valuation proposed under sections 356.215 and 356.216 as of the 
66.3 	preceding December 31 for the Minneapolis Police Relief Association or the Minneapolis 
66.4 	Firefighters Relief Association, 20 percent for the city of Duluth to pay for any costs 
66.5 	associated with the police and firefighters pensions, and 40 percent as additional funding to 
66.6 	support minimum fire state aid for volunteer firefighters relief associations. The allocation 
66.7 	must be made by the commissioner at the same time and under the same procedures 
66.8 	as specified in subdivision 3. With respect to the St. Paul Teachers Retirement Fund 
66.9 	Association, annually, beginning on July 1, 2005, if the applicable teacher's association 
66.10 	five-year average time-weighted rate of investment return does not equal or exceed the 
66.11 	performance of a composite portfolio assumed passively managed (indexed) invested ten 
66.12 	percent in cash equivalents, 60 percent in bonds and similar debt securities, and 30 percent 
66.13 	in domestic stock calculated using the formula under section 11A.04, clause (11), the aid 
66.14 	allocation to that retirement fund under this section ceases until the five-year annual rate 
66.15 	of investment return equals or exceeds the performance of that composite portfolio. 
66.16 	(d) The amounts required under this subdivision are annually appropriated to the 
66.17 	commissioner of revenue.

66.18 	EFFECTIVE DATE. This section is effective August 1, 2008.

66.19 	Sec. 4. REPEALER.
 66.20 	(a) Minnesota Statutes 2006, section 354A.12, subdivision 3a, is repealed effective 
66.21 	the first day of the fiscal year next following the fiscal year in which neither the Teachers 
66.22 	Retirement Association nor the St. Paul Teachers Retirement Fund Association has an 
66.23 	unfunded actuarial accrued liability as determined in the actuarial valuation prepared 
66.24 	under Minnesota Statutes, section 356.215, by the actuary retained under Minnesota 
66.25 	Statutes, section 356.214.
66.26 	(b) Minnesota Statutes 2007 Supplement, section 354A.12, subdivisions 3b and 3c,
66.27 	are repealed effective the first day of the fiscal year next following the fiscal year in which 
66.28 	neither the Teachers Retirement Association nor the St. Paul Teachers Retirement Fund 
66.29 	Association has an unfunded actuarial accrued liability as determined in the actuarial 
66.30 	valuation prepared under Minnesota Statutes, section 356.215, by the actuary retained 
66.31 	under Minnesota Statutes, section 356.214.

67.1 	ARTICLE 10
67.2 	MNSCU-IRAP AND RELATED CHANGES

67.3 	Section 1. Minnesota Statutes 2006, section 354B.20, is amended by adding a 
67.4 	subdivision to read:
67.5 		Subd. 19.Unclaimed plan account amounts. "Unclaimed plan account amounts" 
67.6 	means the accounts of any plan participant who has terminated employment by the 
67.7 	Minnesota State Colleges and Universities System or who has died, or of the surviving 
67.8 	spouse, beneficiary, or estate of the participant if the plan administrator is unable to 
67.9 	locate the applicable recipient in accordance with Internal Revenue Service due diligence 
67.10 	requirements.

67.11 	Sec. 2. Minnesota Statutes 2006, section 354B.25, subdivision 5, is amended to read:
67.12 		Subd. 5.Individual retirement account plan administrative expenses. (a) The 
67.13 	reasonable and necessary administrative expenses of the individual retirement account 
67.14 	plan may be charged to plan participants by the plan sponsor in the form of an annual 
67.15 	fee, an asset-based fee, a percentage of the contributions to the plan, or a combination 
67.16 	thereof. This amount shall be offset by interest earned on both the plan reserves and 
67.17 	unclaimed funds account.
67.18 	(b) Any administrative expense charge that is not actually needed for the 
67.19 	administrative expenses of the individual retirement account plan must be refunded to 
67.20 	member accounts.
67.21 	(c) The Board of Trustees shall report annually, before October 1, to the advisory 
67.22 	committee created in subdivision 1a on administrative expenses of the plan. The report 
67.23 	must include a detailed accounting of charges for administrative expenses collected 
67.24 	from plan participants and expenditure of the administrative expense charges. The 
67.25 	administrative expense charges collected from plan participants must be kept in a separate 
67.26 	account from any other funds under control of the Board of Trustees and may be used only 
67.27 	for the necessary and reasonable administrative expenses of the plan.

67.28 	Sec. 3. Minnesota Statutes 2006, section 354B.25, is amended by adding a subdivision 
67.29 	to read:
67.30 		Subd. 6.Disposition of abandoned public pension amounts. (a) Any unclaimed 
67.31 	plan account amounts are presumed to be abandoned, but are not subject to the provisions 
67.32 	of sections 345.31 to 345.60. If the account remains unclaimed after five years following 
67.33 	the date that the plan administrator first attempts to locate the former member, surviving 
68.1 	spouse, or other beneficiary, the unclaimed plan account amount cancels and must be 
68.2 	credited to the reserve account specified in paragraph (b).
68.3 	(b) The board must establish a separate account to receive unclaimed plan account 
68.4 	amounts. A portion of this reserve account and any investment earnings attributable to 
68.5 	this reserve account are to be used to offset the reasonable and necessary expenses of 
68.6 	the individual retirement account plan, including costs incurred in efforts to locate lost 
68.7 	participants, surviving spouses, or other beneficiaries.
68.8 	(c) If the unclaimed plan account amount exceeded $25 and the inactive member, 
68.9 	surviving spouse, or beneficiary, whichever is applicable, establishes a valid claim to the 
68.10 	forfeited account, the forfeited account is to be reestablished in an amount equal to the 
68.11 	amount originally forfeited. The board must ensure that the reserve account has sufficient 
68.12 	assets to cover any transfers needed to reestablish accounts.

68.13 	Sec. 4. Minnesota Statutes 2007 Supplement, section 354C.12, subdivision 4, is 
68.14 	amended to read:
68.15 		Subd. 4.Administrative expenses. (a) The Board of Trustees of the Minnesota 
68.16 	State Colleges and Universities is authorized to pay the necessary and reasonable 
68.17 	administrative expenses of the supplemental retirement plan and may bill participants to 
68.18 	recover these expenses. The administrative fees or charges may be charged to participants 
68.19 	as an annual fee, an asset-based fee, a percentage of contributions to the plan, or a 
68.20 	contribution thereof. This amount shall be offset by interest earned on both the plan 
68.21 	reserves and unclaimed funds account.
68.22 	(b) Any recovered or assessed amounts that are not needed for the necessary and 
68.23 	reasonable administrative expenses of the plan must be refunded to member accounts.
68.24 	(c) The Board of Trustees shall report annually, before October 1, to the legislature 
68.25 	on administrative expenses of the plan. The report must include a detailed accounting of 
68.26 	charges for administrative expenses collected from plan participants and expenditure 
68.27 	of the administrative expense charges. The administrative expense charges collected 
68.28 	from plan participants must be kept in a separate account from any other funds under 
68.29 	control of the Board of Trustees and may be used only for the necessary and reasonable 
68.30 	administrative expenses of the plan. 

68.31 	Sec. 5. [354C.155] UNCLAIMED PLAN ACCOUNT AMOUNTS.
68.32 	Section 354B.25, subdivision 6, applies to the supplemental retirement plan.

69.1 	Sec. 6. Minnesota Statutes 2006, section 354C.165, is amended to read:
69.2 	354C.165 PROHIBITION ON LOANS OR PRETERMINATION 
69.3 	DISTRIBUTIONS.
69.4 	(a) Except as provided in paragraph (c), No participant may obtain a loan or any 
69.5 	distribution from the plan before the participant terminates the employment that gave 
69.6 	rise to plan coverage.
69.7 	(b) No amounts to the credit of the plan are assignable either in law or in equity, or 
69.8 	are subject to execution, levy, attachment, garnishment, or other legal process, except as 
69.9 	provided in section 518.58, 518.581, or 518A.53. 
69.10 	(c) MS 2002 [Expired]
69.11 	(d) Except for a participant in a phased retirement program that is part of an approved 
69.12 	collective bargaining agreement, no participant may obtain a distribution from the plan at a 
69.13 	time before the participant terminates the employment that gave rise to the plan coverage.

69.14 	Sec. 7. ACTUARIAL IMPACT STUDY; MNSCU-TENURED FACULTY 
69.15 	RETIREMENT PLAN COVERAGE CHANGE.
 69.16 	(a) The Teachers Retirement Association shall have the actuary retained under 
69.17 	Minnesota Statutes, section 356.214, conduct a study of the likely actuarial impact on the 
69.18 	Teachers Retirement Association of potentially permitting current tenure-track faculty 
69.19 	members employed by the Minnesota State Colleges and Universities System who have 
69.20 	not yet attained tenure or its equivalent to elect retroactive and prospective retirement 
69.21 	coverage by the Teachers Retirement Association within one year of attaining tenure or 
69.22 	its equivalent, with the retroactive coverage effected by a service credit purchase under 
69.23 	Minnesota Statutes, section 356.551.
69.24 	(b) The actuarial study must include an assessment of the likelihood that tenure-track 
69.25 	Minnesota State Colleges and Universities System faculty members would elect retirement 
69.26 	coverage by the Teachers Retirement Association that underlies any election assumption 
69.27 	used in the study based on the experience of Minnesota State Colleges and Universities 
69.28 	System faculty members employed during the most recent ten years. The Minnesota State 
69.29 	Colleges and Universities System shall provide the Teachers Retirement Association with 
69.30 	the data on its faculty members necessary to conduct the study.
69.31 	(c) The actuarial study must assess the actuarial accrued liability that could be 
69.32 	assumed by the Teachers Retirement Association from potential service credit purchases 
69.33 	by Minnesota State Colleges and Universities System faculty members attaining tenure 
69.34 	or its equivalent, the likely purchase payments related to those potential Minnesota State 
69.35 	Colleges and Universities System faculty member service credit purchases, and the effect 
70.1 	on the Teachers Retirement Association normal cost rate of the potential prospective 
70.2 	inclusion of Minnesota State Colleges and Universities System faculty members upon 
70.3 	attaining tenure.
70.4 	(d) The report required under this section must be filed with the executive director of 
70.5 	the Legislative Commission on Pensions and Retirement on or before January 15, 2009.

70.6 	EFFECTIVE DATE. This section is effective July 1, 2008.

70.7 	ARTICLE 11
70.8 	FINANCIAL AND ACTUARIAL REPORTING

70.9 	Section 1. Minnesota Statutes 2006, section 16A.055, subdivision 5, is amended to 
70.10 	read:
70.11 		Subd. 5.Retirement fund reporting. (a) The commissioner may not require a 
70.12 	public retirement fund to use financial or actuarial reporting practices or procedures 
70.13 	different from those required by section 356.20 or 356.215. 
70.14 	(b) The commissioner may contract with the consulting actuary retained under 
70.15 	section 356.214  for the preparation of quadrennial projection valuations as required 
70.16 	under section 356.215, subdivisions 2 and 2a. The initial projection valuation under 
70.17 	this paragraph, if any, is due on May 1, 2003, and subsequent projection valuations are 
70.18 	due on May 1 each fourth year thereafter. The commissioner of finance shall assess the 
70.19 	applicable statewide and major local retirement plan or plans the cost of the quadrennial 
70.20 	projection valuation. 

70.21 	Sec. 2. Minnesota Statutes 2006, section 356.20, subdivision 1, is amended to read:
70.22 		Subdivision 1.Report required. (a) The governing or managing board or the 
70.23 	chief administrative officialsofficer of theeach public pension and retirement fundsplan 
70.24 	enumerated in subdivision 2 shall annually prepare and file a financial report following the 
70.25 	close of each fiscal year.
70.26 	(b) This requirement also applies to any plan or fund which may be a successor to any 
70.27 	organization so enumerated or to any newly formed retirement plan, fund or association 
70.28 	operating under the control or supervision of any public employee group, governmental 
70.29 	unit, or institution receiving a portion of its support through legislative appropriations.
70.30 	(c)  The report must be prepared under the supervision and at the direction of 
70.31 	the management of each fundplan and must be signed by the presiding officer of the 
70.32 	managing board of the fundplan and the chief administrative official of the fund plan.

71.1 	Sec. 3. Minnesota Statutes 2006, section 356.20, subdivision 2, is amended to read:
71.2 		Subd. 2.Covered public pension plans and funds. This section applies to the 
71.3 	following public pension plans:
71.4 	(1) the general state employees retirement plan of the Minnesota State Retirement 
71.5 	System;
71.6 	(2) the general employees retirement plan of the Public Employees Retirement 
71.7 	Association;
71.8 	(3) the Teachers Retirement Association;
71.9 	(4) the State Patrol retirement plan;
71.10 	(5) the St. Paul Teachers Retirement Fund Association;
71.11 	(6) the Duluth Teachers Retirement Fund Association;
71.12 	(7) the Minneapolis Employees Retirement Fund;
71.13 	(8) the University of Minnesota faculty retirement plan;
71.14 	(9) the University of Minnesota faculty supplemental retirement plan;
71.15 	(10) the judges retirement fund;
71.16 	(11) a police or firefighter's relief association specified or described in section 69.77, 
71.17 	subdivision 1a, or;
71.18 	(12) a volunteer firefighter relief association governed by section69.771, subdivision 
71.19 	1; 
71.20 	(12)(13) the public employees police and fire plan of the Public Employees 
71.21 	Retirement Association;
71.22 	(13)(14) the correctional state employees retirement plan of the Minnesota State 
71.23 	Retirement System; and
71.24 	(14)(15) the local government correctional service retirement plan of the Public 
71.25 	Employees Retirement Association.

71.26 	Sec. 4. Minnesota Statutes 2006, section 356.20, subdivision 3, is amended to read:
71.27 		Subd. 3.Filing requirement. The financial report is a public record. A copy of the 
71.28 	report or a synopsis of the report containing the information required by this section must 
71.29 	be distributedmade available annually to each member of the fund and to the governing 
71.30 	body of each governmental subdivision of the state which makes employers contributions 
71.31 	thereto or in whose behalf taxes are levied for the employers' contribution. A signed copy 
71.32 	of the report must be delivered to the executive director of the Legislative Commission 
71.33 	on Pensions and Retirement and to the Legislative Reference Library not later than six 
71.34 	months after the close of each fiscal year or one month following the completion and 
72.1 	delivery to the retirement fund of the actuarial valuation report of the fund by the actuary 
72.2 	retained under section 356.214, if applicable, whichever is later.

72.3 	Sec. 5. Minnesota Statutes 2006, section 356.20, subdivision 4, is amended to read:
72.4 		Subd. 4.Contents of financial report. (a) The financial report required by 
72.5 	this section must contain financial statements and disclosures that indicate the financial 
72.6 	operations and position of the retirement plan and fund. The report must conform with 
72.7 	generally accepted governmental accounting principles, applied on a consistent basis. The 
72.8 	report must be audited. 
72.9 	(b) The report must include, as part of its exhibits or its footnotes, an actuarial 
72.10 	disclosure item based on the actuarial valuation calculations prepared by the actuary 
72.11 	retained under section 356.214 or by the actuary retained by the retirement fund or 
72.12 	plan, whichever applies, according to applicable actuarial requirements enumerated in 
72.13 	section 356.215, and specified in the most recent standards for actuarial work adopted 
72.14 	by the Legislative Commission on Pensions and Retirement. The accruedactuarial value 
72.15 	of assets, the actuarial accrued liabilities, including accrued reserves, and the unfunded 
72.16 	actuarial accrued liability of the fund or plan must be disclosed. The disclosure item 
72.17 	must contain a declaration by the actuary retained under section 356.214 or the actuary 
72.18 	retained by the fund or plan, whichever applies, specifying that the required reserves 
72.19 	for any retirement, disability, or survivor benefits provided under a benefit formula are 
72.20 	computed in accordance with the entry age actuarial cost method and in accordance 
72.21 	with the most recent applicable standards for actuarial work adopted by the Legislative 
72.22 	Commission on Pensions and Retirement.
72.23 	(b) Assets of the fund or plan contained in the disclosure item must include the 
72.24 	following statement of the actuarial value of current assets as defined in section 356.215, 
72.25 	subdivision 1:

72.26
72.27				Value at 
cost
		Value at 
market
	
72.28	Cash, cash equivalents, and
					
72.29		short-term securities
		........
		........
	
72.30	Accounts receivable
		........
		........
	
72.31	Accrued investment income
		........
		........
	
72.32	Fixed income investments
		........
		........
	
72.33	Equity investments other
					
72.34		than real estate
		........
		........
	
72.35	Real estate investments
		........
		........
	
72.36	Equipment
		........
		........
	
72.37	Participation in the Minnesota
					
72.38		postretirement investment
					
73.1		fund or the retirement
					
73.2		benefit fund
		........
		........
	
73.3	Other
		........
		........

73.4	Total assets
					
73.5		Value at cost
				........
	
73.6		Value at market
				........
	
73.7
73.8		Actuarial value of current 
assets
				........
	
73.9 	(c) The unfunded actuarial accrued liability of the fund or plan contained in the 
73.10 	disclosure item must include the following measures of unfunded actuarial accrued 
73.11 	liability, using the actuarial value of current assets:
73.12 	(1) the unfunded actuarial accrued liability, determined by subtracting the current 
73.13 	assets and the present value of future normal costs from the total current and expected 
73.14 	future benefit obligations; and
73.15 	(2) the unfunded pension benefit obligation, determined by subtracting the current 
73.16 	assets from the actuarial present value of credited projected benefits.
73.17 	If the current assets of the fund or plan exceed the actuarial accrued liabilities, the 
73.18 	excess must be disclosed and indicated as a surplus.
73.19 	(d) The pension benefit obligations schedule included in the disclosure must contain 
73.20 	the following information on the benefit obligations:
73.21 	(1) the pension benefit obligation, determined as the actuarial present value of 
73.22 	credited projected benefits on account of service rendered to date, separately identified 
73.23 	as follows:

73.24		(i)
	for annuitants,
	
73.25			retirement annuities,
	
73.26			disability benefits,
	
73.27			surviving spouse and child benefits;
	
73.28
73.29		(ii)
	for former members without vested 
rights;
	
73.30
73.31		(iii)
	for deferred annuitants' benefits, 
including any augmentation;
	
73.32		(iv)
	for active employees,
	
73.33
73.34			accumulated employee contributions, 
including allocated investment income,
	
73.35			employer-financed benefits vested,
	
73.36			employer-financed benefits nonvested,
	
73.37			total pension benefit obligation; and
	
73.38 	(2) if there are additional benefits not appropriately covered by the foregoing items 
73.39 	of benefit obligations, a separate identification of the obligation.
74.1 	(e)(c) The report must contain an itemized exhibit describing the administrative 
74.2 	expenses of the plan, including, but not limited to, the following items, classified on a 
74.3 	consistent basis from year to year, and with any further meaningful detail:
74.4 	(1) personnel expenses;
74.5 	(2) communication-related expenses;
74.6 	(3) office building and maintenance expenses;
74.7 	(4) professional services fees; and
74.8 	(5) other expenses.
74.9 	(f)(d) The report must contain an itemized exhibit describing the investment 
74.10 	expenses of the plan, including, but not limited to, the following items, classified on a 
74.11 	consistent basis from year to year, and with any further meaningful detail:
74.12 	(1) internal investment-related expenses; and
74.13 	(2) external investment-related expenses.
74.14 	(g)(e) Any additional statements or exhibits or more detailed or subdivided 
74.15 	itemization of a disclosure item that will enable the management of the fundplan to 
74.16 	portray a true interpretation of the fund'splan's financial condition must be included in the 
74.17 	additional statements or exhibits.

74.18 	Sec. 6. Minnesota Statutes 2006, section 356.20, subdivision 4a, is amended to read:
74.19 		Subd. 4a.Financial report for police or firefighters relief association. For any 
74.20 	police or firefighter's relief association referred to in subdivision 2, clause (11) or (12), a 
74.21 	financial report that is duly filed and meetingthat meets the requirements of section  69.051
74.22 	must beis deemed to have met the requirements of subdivision 4. 

74.23 	Sec. 7. Minnesota Statutes 2006, section 356.214, subdivision 1, is amended to read:
74.24 		Subdivision 1.JointActuary retention. (a) The chief administrative officers of the 
74.25 	Minnesota State Retirement System, the Public Employees Retirement Association, the 
74.26 	Teachers Retirement Association, the Duluth Teachers Retirement Fund Association, the 
74.27 	Minneapolis Employees Retirement Fund, and the St. Paul Teachers Retirement Fund 
74.28 	Association, jointly, on behalf of the state, its employees, its taxpayers, and its various 
74.29 	public pension plans,governing board or managing or administrative official of each 
74.30 	public pension plan and retirement fund or plan enumerated in paragraph (b) shall contract 
74.31 	with an established actuarial consulting firm to conduct annual actuarial valuations and 
74.32 	related services for the retirement plans named in paragraph (b). The principal from 
74.33 	the actuarial consulting firm on the contract must be an approved actuary under section 
74.34 	356.215, subdivision 1, paragraph (c). Prior to becoming effective, the contract under this 
75.1 	section is subject to a review and approval by the Legislative Commission on Pensions 
75.2 	and Retirement.
75.3 	(b) The contract for Actuarial services must include the preparation of actuarial 
75.4 	valuations and related actuarial work for the following retirement plans:
75.5 	(1) the teachers retirement plan, Teachers Retirement Association;
75.6 	(2) the general state employees retirement plan, Minnesota State Retirement System;
75.7 	(3) the correctional employees retirement plan, Minnesota State Retirement System;
75.8 	(4) the State Patrol retirement plan, Minnesota State Retirement System;
75.9 	(5) the judges retirement plan, Minnesota State Retirement System;
75.10 	(6) the Minneapolis employees retirement plan, Minneapolis Employees Retirement 
75.11 	Fund;
75.12 	(7) the public employees retirement plan, Public Employees Retirement Association;
75.13 	(8) the public employees police and fire plan, Public Employees Retirement 
75.14 	Association;
75.15 	(9) the Duluth teachers retirement plan, Duluth Teachers Retirement Fund 
75.16 	Association;
75.17 	(10) the St. Paul teachers retirement plan, St. Paul Teachers Retirement Fund 
75.18 	Association;
75.19 	(11) the legislators retirement plan, Minnesota State Retirement System;
75.20 	(12) the elective state officers retirement plan, Minnesota State Retirement System; 
75.21 	and
75.22 	(13) local government correctional service retirement plan, Public Employees 
75.23 	Retirement Association.
75.24 	(c) The contractcontracts must require completion of the annual actuarial valuation 
75.25 	calculations on a fiscal year basis, with the contents of the actuarial valuation calculations 
75.26 	as specified in section 356.215, and in conformity with the standards for actuarial work 
75.27 	adopted by the Legislative Commission on Pensions and Retirement. 
75.28 	The contractcontracts must require completion of annual experience data collection 
75.29 	and processing and a quadrennial published experience study for the plans listed in 
75.30 	paragraph (b), clauses (1), (2), and (7), as provided for in the standards for actuarial work 
75.31 	adopted by the commission. The experience data collection, processing, and analysis 
75.32 	must evaluate the following:
75.33 	(1) individual salary progression;
75.34 	(2) the rate of return on investments based on the current asset value;
75.35 	(3) payroll growth;
75.36 	(4) mortality;
76.1 	(5) retirement age;
76.2 	(6) withdrawal; and
76.3 	(7) disablement.
76.4 	The contract must include provisions for the preparation of cost analyses by the 
76.5 	jointly retained actuary for proposed legislation that include changes in benefit provisions 
76.6 	or funding policies prior to their consideration by the Legislative Commission on Pensions 
76.7 	and Retirement.
76.8 	(d) The actuary retained by the joint retirement systems shall annually prepare a 
76.9 	report to the governing or managing board or administrative official and the legislature, 
76.10 	including a commentary on the actuarial valuation calculations for the plans named in 
76.11 	paragraph (b) and summarizing the results of the actuarial valuation calculations. The 
76.12 	actuary shall include with the report the actuary'sany recommendations to the legislature
76.13 	concerning the appropriateness of the support rates to achieve proper funding of the 
76.14 	retirement plans by the required funding dates. The actuary shall, as part of the quadrennial 
76.15 	experience study, include recommendations to the legislature on the appropriateness of the 
76.16 	actuarial valuation assumptions required for evaluation in the study.
76.17 	(e) If the actuarial gain and loss analysis in the actuarial valuation calculations 
76.18 	indicates a persistent pattern of sizable gains or losses, as directed by the joint retirement 
76.19 	systems or as requested by the chair of the Legislative Commission on Pensions and 
76.20 	Retirement, the governing or managing board or administrative official shall direct the 
76.21 	actuary shall to prepare a special experience study for a plan listed in paragraph (b), 
76.22 	clause (3), (4), (5), (6), (8), (9), (10), (11), (12), or (13), in the manner provided for in the 
76.23 	standards for actuarial work adopted by the commission.
76.24 	(f) The term of the contract between the joint retirement systems and the actuary 
76.25 	retained may not exceed five years. The joint retirement system administrative officers 
76.26 	shall establish procedures for the consideration and selection of contract bidders and 
76.27 	the requirements for the contents of an actuarial services contract under this section. 
76.28 	The procedures and requirements must be submitted to the Legislative Commission on 
76.29 	Pensions and Retirement for review and comment prior to final approval by the joint 
76.30 	administrators. The contract is subject to the procurement procedures under chapter 16C. 
76.31 	The consideration of bids and the selection of a consulting actuarial firm by the chief 
76.32 	administrative officers must occur at a meeting that is open to the public and reasonable 
76.33 	timely public notice of the date and the time of the meeting and its subject matter must 
76.34 	be given.
77.1 	(g) The actuarial services contract may not limit the ability of the Minnesota 
77.2 	legislature and its standing committees and commissions to rely on the actuarial results 
77.3 	of the work prepared under the contract.
77.4 	(h) The joint retirement systems shall designate one of the retirement system 
77.5 	executive directors as the actuarial services contract manager.

77.6 	Sec. 8. Minnesota Statutes 2006, section 356.214, subdivision 3, is amended to read:
77.7 		Subd. 3.Reporting to commission. A copy of the actuarial valuations,and 
77.8 	experience studies, and actuarial cost analyses prepared by the actuary retained by the 
77.9 	joint retirement systems under thea contract provided for in this section must be filed with 
77.10 	the executive director of the Legislative Commission on Pensions and Retirement at the 
77.11 	same time that the document is transmitted to the actuarial services contract manager or 
77.12 	to any other document recipient.

77.13 	Sec. 9. Minnesota Statutes 2006, section 356.214, is amended by adding a subdivision 
77.14 	to read:
77.15 		Subd. 4.Commission to contract with auditing actuary. (a) The Legislative 
77.16 	Commission on Pensions and Retirement may contract with an established actuarial 
77.17 	consulting firm to audit or review the actuarial valuations, experience studies, and actuarial 
77.18 	cost analyses prepared by the actuary retained by the governing or managing boards, or 
77.19 	administrative officials of each of the plans or funds listed in subdivision 1, paragraph 
77.20 	(b). The principal representative from the actuarial consulting firm so engaged must be an 
77.21 	approved actuary under section 356.215, subdivision 1, paragraph (c).
77.22 	(b) Any actuarial consulting firm retained under paragraph (a) will, according to a 
77.23 	schedule determined under an agreement with the Legislative Commission on Pensions 
77.24 	and Retirement, audit the valuation reports submitted by the actuary retained by each 
77.25 	governing or managing board or administrative official, and provide an assessment of the 
77.26 	reasonableness, reliability, and areas of concern or potential improvement in the specific 
77.27 	reports reviewed, the procedures utilized by any particular reporting actuary, or general 
77.28 	modifications to standards, procedures, or assumptions that the commission may wish to 
77.29 	consider. Actuarial firms retained by the retirement funds must cooperate fully and make 
77.30 	available any data or other materials necessary for the commission-retained actuary to 
77.31 	conduct an adequate review and to render advice to the commission.

77.32 	Sec. 10. Minnesota Statutes 2006, section 356.215, subdivision 1, is amended to read:
78.1 		Subdivision 1.Definitions. (a) For the purposes of sections 3.85 and 356.20 to 
78.2 	356.23, each of the terms in the following paragraphs has the meaning given. 
78.3 	(b) "Actuarial valuation" means a set of calculations prepared by thean actuary 
78.4 	retained under section 356.214 if so required under section 3.85, or otherwise, by an 
78.5 	approved actuary, to determine the normal cost and the accrued actuarial liabilities of 
78.6 	a benefit plan, according to the entry age actuarial cost method and based upon stated 
78.7 	assumptions including, but not limited to rates of interest, mortality, salary increase, 
78.8 	disability, withdrawal, and retirement and to determine the payment necessary to amortize 
78.9 	over a stated period any unfunded accrued actuarial liability disclosed as a result of the 
78.10 	actuarial valuation of the benefit plan. 
78.11 	(c) "Approved actuary" means a person who is regularly engaged in the business 
78.12 	of providing actuarial services and who has at least 15 years of service to major public 
78.13 	employee pension or retirement funds or who is a fellow in the Society of Actuaries.
78.14 	(d) "Entry age actuarial cost method" means an actuarial cost method under which 
78.15 	the actuarial present value of the projected benefits of each individual currently covered 
78.16 	by the benefit plan and included in the actuarial valuation is allocated on a level basis over 
78.17 	the service of the individual, if the benefit plan is governed by section 69.773, or over the 
78.18 	earnings of the individual, if the benefit plan is governed by any other law, between the 
78.19 	entry age and the assumed exit age, with the portion of the actuarial present value which is 
78.20 	allocated to the valuation year to be the normal cost and the portion of the actuarial present 
78.21 	value not provided for at the valuation date by the actuarial present value of future normal 
78.22 	costs to be the actuarial accrued liability, with aggregation in the calculation process to be 
78.23 	the sum of the calculated result for each covered individual and with recognition given to 
78.24 	any different benefit formulas which may apply to various periods of service.
78.25 	(e) "Experience study" means a report providing experience data and an actuarial 
78.26 	analysis of the adequacy of the actuarial assumptions on which actuarial valuations are 
78.27 	based.
78.28 	(f) "Current"Actuarial value of assets" means:
78.29 	(1) for the July 1, 2001, actuarial valuation, the market value of all assets as of 
78.30 	June 30, 2001, reduced by:
78.31 	(i) 30 percent of the difference between the market value of all assets as of June 30, 
78.32 	1999, and the actuarial value of assets used in the July 1, 1999, actuarial valuation;
78.33 	(ii) 60 percent of the difference between the actual net change in the market value of 
78.34 	assets between June 30, 1999, and June 30, 2000, and the computed increase in the market 
78.35 	value of assets between June 30, 1999, and June 30, 2000, if the assets had increased at 
79.1 	the percentage preretirement interest rate assumption used in the July 1, 1999, actuarial 
79.2 	valuation; and
79.3 	(iii) 80 percent of the difference between the actual net change in the market value 
79.4 	of assets between June 30, 2000, and June 30, 2001, and the computed increase in 
79.5 	the market value of assets between June 30, 2000, and June 30, 2001, if the assets had 
79.6 	increased at the percentage preretirement interest rate assumption used in the July 1, 
79.7 	2000, actuarial valuation;
79.8 	(2) for the July 1, 2002, actuarial valuation, the market value of all assets as of 
79.9 	June 30, 2002, reduced by:
79.10 	(i) ten percent of the difference between the market value of all assets as of June 30, 
79.11 	1999, and the actuarial value of assets used in the July 1, 1999, actuarial valuation;
79.12 	(ii) 40 percent of the difference between the actual net change in the market value of 
79.13 	assets between June 30, 1999, and June 30, 2000, and the computed increase in the market 
79.14 	value of assets between June 30, 1999, and June 30, 2000, if the assets had increased at 
79.15 	the percentage preretirement interest rate assumption used in the July 1, 1999, actuarial 
79.16 	valuation;
79.17 	(iii) 60 percent of the difference between the actual net change in the market value 
79.18 	of assets between June 30, 2000, and June 30, 2001, and the computed increase in 
79.19 	the market value of assets between June 30, 2000, and June 30, 2001, if the assets had 
79.20 	increased at the percentage preretirement interest rate assumption used in the July 1, 2000, 
79.21 	actuarial valuation; and
79.22 	(iv) 80 percent of the difference between the actual net change in the market value of 
79.23 	assets between June 30, 2001, and June 30, 2002, and the computed increase in the market 
79.24 	value of assets between June 30, 2001, and June 30, 2002, if the assets had increased at 
79.25 	the percentage preretirement interest rate assumption used in the July 1, 2001, actuarial 
79.26 	valuation; or
79.27 	(3) for any actuarial valuation after July 1, 2002, the market value of all assets 
79.28 	as of the preceding June 30, reduced by:
79.29 	(i)(1) 20 percent of the difference between the actual net change in the market value 
79.30 	of assets between the June 30 that occurred three years earlier and the June 30 that occurred 
79.31 	four years earlier and the computed increase in the market value of assets over that 
79.32 	fiscal year period if the assets had increased at the percentage preretirement interest rate 
79.33 	assumption used in the actuarial valuation for the July 1 that occurred four years earlier;
79.34 	(ii)(2) 40 percent of the difference between the actual net change in the market value 
79.35 	of assets between the June 30 that occurred two years earlier and the June 30 that occurred 
79.36 	three years earlier and the computed increase in the market value of assets over that 
80.1 	fiscal year period if the assets had increased at the percentage preretirement interest rate 
80.2 	assumption used in the actuarial valuation for the July 1 that occurred three years earlier;
80.3 	(iii)(3) 60 percent of the difference between the actual net change in the market 
80.4 	value of assets between the June 30 that occurred one year earlier and the June 30 that 
80.5 	occurred two years earlier and the computed increase in the market value of assets over 
80.6 	that fiscal year period if the assets had increased at the percentage preretirement interest 
80.7 	rate assumption used in the actuarial valuation for the July 1 that occurred two years 
80.8 	earlier; and
80.9 	(iv)(4) 80 percent of the difference between the actual net change in the market 
80.10 	value of assets between the immediately prior June 30 and the June 30 that occurred one 
80.11 	year earlier and the computed increase in the market value of assets over that fiscal year 
80.12 	period if the assets had increased at the percentage preretirement interest rate assumption 
80.13 	used in the actuarial valuation for the July 1 that occurred one year earlier.
80.14 	(g) "Unfunded actuarial accrued liability" means the total current and expected 
80.15 	future benefit obligations, reduced by the sum of currentthe actuarial value of assets and 
80.16 	the present value of future normal costs.
80.17 	(h) "Pension benefit obligation" means the actuarial present value of credited 
80.18 	projected benefits, determined as the actuarial present value of benefits estimated to be 
80.19 	payable in the future as a result of employee service attributing an equal benefit amount, 
80.20 	including the effect of projected salary increases and any step rate benefit accrual rate 
80.21 	differences, to each year of credited and expected future employee service.

80.22 	Sec. 11. Minnesota Statutes 2006, section 356.215, subdivision 2, is amended to read:
80.23 		Subd. 2.Requirements. (a) It is the policy of the legislature that it is necessary 
80.24 	and appropriate to determine annually the financial status of tax supported retirement and 
80.25 	pension plans for public employees. To achieve this goal:,
80.26 	(1) the actuary retained under section 356.214 shall prepare annual actuarial 
80.27 	valuations of the retirement plans enumerated in section 356.214, subdivision 1, paragraph 
80.28 	(b), and quadrennial experience studies of the retirement plans enumerated in section 
80.29 	356.214, subdivision 1, paragraph (b), clauses (1), (2), and (7); and.
80.30 	(2) the commissioner of finance may have prepared by the actuary retained by the 
80.31 	commission, two years after each set of quadrennial experience studies, quadrennial 
80.32 	projection valuations of at least one of the retirement plans enumerated in section 6, 
80.33 	subdivision 1, paragraph (b), for which the commissioner determines that the analysis 
80.34 	may be beneficial.
81.1 	(b) The governing or managing board or administrative officials of each public 
81.2 	pension and retirement fund or plan enumerated in section   356.20, subdivision 2, clauses 
81.3 	(9), (10) (11), and (12), shall have prepared by an approved actuary annual actuarial 
81.4 	valuations of their respective funds as provided in this section. This requirement also 
81.5 	applies to any fund or plan that is the successor to any organization enumerated in section 
81.6 	356.20, subdivision 2, or to the governing or managing board or administrative officials 
81.7 	of any newly formed retirement fund, plan, or association operating under the control or 
81.8 	supervision of any public employee group, governmental unit, or institution receiving a 
81.9 	portion of its support through legislative appropriations, and any local police or fire fund
81.10 	relief association to which section 356.216 applies.

81.11 	Sec. 12. Minnesota Statutes 2006, section 356.215, subdivision 3, is amended to read:
81.12 		Subd. 3.Reports. (a) The actuarial valuations required annually must be made as of 
81.13 	the beginning of each fiscal year.
81.14 	(b) Two copies of the completed valuation must be delivered to the executive 
81.15 	director of the Legislative Commission on Pensions and Retirement, to the commissioner 
81.16 	of finance, and to the Legislative Reference Library, not later than the first day of the sixth 
81.17 	month occurring after the end of the previous fiscal year.
81.18 	(c) Two copies of a quadrennial experience study must be filed with the 
81.19 	executive director of the Legislative Commission on Pensions and Retirement, with the 
81.20 	commissioner of finance, and with the Legislative Reference Library, not later than the 
81.21 	first day of the 11th month occurring after the end of the last fiscal year of the four-year 
81.22 	period which the experience study covers.
81.23 	(d) For actuarial valuations and experience studies prepared at the direction of the 
81.24 	Legislative Commission on Pensions and Retirement, two copies of the document must be 
81.25 	delivered to the governing or managing board or administrative officials of the applicable 
81.26 	public pension and retirement fund or plan.

81.27 	Sec. 13. Minnesota Statutes 2006, section 356.215, subdivision 8, is amended to read:
81.28 		Subd. 8.Interest and salary assumptions. (a) The actuarial valuation must use 
81.29 	the applicable following preretirement interest assumption and the applicable following 
81.30 	postretirement interest assumption:

81.31		preretirement
	postretirement
		
81.32		interest rate
	interest rate
		
81.33	plan
	assumption
	assumption

82.1	general state employees retirement plan
		8.5%
	6.0%
	
82.2
82.3	correctional state employees retirement 
plan
		8.5
	6.0
	
82.4	State Patrol retirement plan
		8.5
	6.0
	
82.5	legislators retirement plan
		8.5
	6.0
	
82.6	elective state officers retirement plan
		8.5
	6.0
	
82.7	judges retirement plan
		8.5
	6.0
	
82.8
82.9	general public employees retirement 
plan
		8.5
	6.0
	
82.10
82.11	public employees police and fire 
retirement plan
		8.5
	6.0
	
82.12
82.13	local government correctional service 
retirement plan
		8.5
	6.0
	
82.14	teachers retirement plan
		8.5
	6.0
	
82.15	Minneapolis employees retirement plan
		6.0
	5.0
	
82.16	Duluth teachers retirement plan
		8.5
	8.5
	
82.17	St. Paul teachers retirement plan
		8.5
	8.5
	
82.18	Minneapolis Police Relief Association
		6.0
	6.0
	
82.19	Fairmont Police Relief Association
		5.0
	5.0
	
82.20
82.21	Minneapolis Fire Department Relief 
Association
		6.0
	6.0
	
82.22
82.23	Virginia Fire Department Relief 
Association
		5.0
	5.0
	
82.24
82.25	Bloomington Fire Department Relief 
Association
		6.0
	6.0
	
82.26
82.27	local monthly benefit volunteer 
firefighters relief associations
		5.0
	5.0
	
82.28 	(b) Before July 1, 2010, the actuarial valuation must use the applicable following 
82.29 	single rate future salary increase assumption, the applicable following modified single 
82.30 	rate future salary increase assumption, or the applicable following graded rate future 
82.31 	salary increase assumption:
82.32 	(1) single rate future salary increase assumption

82.33		future salary
	
82.34	plan
	increase assumption

82.35	legislators retirement plan
		5.0%
	
82.36	elective state officers retirement plan
		5.0
	
82.37
82.38	judges retirement plan
		5.0
4.0
	
82.39	Minneapolis Police Relief Association
		4.0
	
82.40	Fairmont Police Relief Association
		3.5
	
82.41
82.42	Minneapolis Fire Department Relief 
Association
		4.0
	
83.1	Virginia Fire Department Relief Association
		3.5
	
83.2
83.3	Bloomington Fire Department Relief 
Association
		4.0
	
83.4 	(2) modified single rate future salary increase assumption

83.5			future salary
	
83.6	plan
		increase assumption
	
83.7
83.8
83.983.10
83.11
	Minneapolis employees 
retirement plan
		the prior calendar year amount 
increased first by 1.0198 percent to 
prior fiscal year date and then increased 
by 4.0 percent annually for each future 
year
	
83.12 	(3) select and ultimate future salary increase assumption or graded rate future salary 
83.13 	increase assumption

83.14		future salary
	
83.15	plan
	increase assumption
	
83.16
83.17	general state employees 
retirement plan
	select calculation and assumption A
	
83.18
83.19	correctional state employees 
retirement plan
	assumption GH
	
83.20	State Patrol retirement plan
	assumption G
	
83.21
83.22	general public employees 
retirement plan
	select calculation and assumption B
	
83.23
83.24	public employees police and fire 
fund retirement plan
	assumption C
	
83.25
83.26	local government correctional 
service retirement plan
	assumption G
	
83.27	teachers retirement plan
	assumption D
	
83.28	Duluth teachers retirement plan
	assumption E
	
83.29	St. Paul teachers retirement plan
	assumption F
	
83.30 	The select calculation is: during the ten-year
83.31 	designated select period, a designated 
83.32 	percentpercentage rate is multiplied by the 
83.33 	result of tenthe designated integer minus T, 
83.34 	where T is the number of completed years 
83.35 	of service, and is added to the applicable 
83.36 	future salary increase assumption. The 
83.37 	designated select period is five years and 
83.38 	the designated integer is five for the general 
83.39 	state employees retirement plan and the 
83.40 	general public employees retirement plan. 
83.41 	The designated select period is ten years and 
84.1 	the designated integer is ten for all other 
84.2 	retirement plans covered by this clause. The 
84.3 	designated percentpercentage rate is: (1) 0.2 
84.4 	percent for the correctional state employees 
84.5 	retirement plan, the State Patrol retirement 
84.6 	plan, the public employees police and fire 
84.7 	plan, and the local government correctional 
84.8 	service plan; and 0.3 (2) 0.6 percent for 
84.9 	the general state employees retirement 
84.10 	plan,and the general public employees 
84.11 	retirement plan,; and (3) 0.3 percent for the 
84.12 	teachers retirement plan, the Duluth Teachers 
84.13 	Retirement Fund Association, and the St. 
84.14 	Paul Teachers Retirement Fund Association.
84.15 	The select calculation for the Duluth Teachers 
84.16 	Retirement Fund Association is 8.00 percent 
84.17 	per year for service years one through seven, 
84.18 	7.25 percent per year for service years seven 
84.19 	and eight, and 6.50 percent per year for 
84.20 	service years eight and nine.
84.21 	The ultimate future salary increase assumption is:

84.22	age
	A
	B
	C
	D
	E
	F
	G
	
84.23	16
	6.95%
	6.95%
	11.50%
	8.20%
	8.00%
	6.90%
	7.7500%
	
84.24	17
	6.90
	6.90
	11.50
	8.15
	8.00
	6.90
	7.7500
	
84.25	18
	6.85
	6.85
	11.50
	8.10
	8.00
	6.90
	7.7500
	
84.26	19
	6.80
	6.80
	11.50
	8.05
	8.00
	6.90
	7.7500
	
84.27	20
	6.75
	6.40
	11.50
	6.00
	6.90
	6.90
	7.7500
	
84.28	21
	6.75
	6.40
	11.50
	6.00
	6.90
	6.90
	7.1454
	
84.29	22
	6.75
	6.40
	11.00
	6.00
	6.90
	6.90
	7.0725
	
84.30	23
	6.75
	6.40
	10.50
	6.00
	6.85
	6.85
	7.0544
	
84.31	24
	6.75
	6.40
	10.00
	6.00
	6.80
	6.80
	7.0363
	
84.32	25
	6.75
	6.40
	9.50
	6.00
	6.75
	6.75
	7.0000
	
84.33	26
	6.75
	6.36
	9.20
	6.00
	6.70
	6.70
	7.0000
	
84.34	27
	6.75
	6.32
	8.90
	6.00
	6.65
	6.65
	7.0000
	
84.35	28
	6.75
	6.28
	8.60
	6.00
	6.60
	6.60
	7.0000
	
84.36	29
	6.75
	6.24
	8.30
	6.00
	6.55
	6.55
	7.0000
	
84.37	30
	6.75
	6.20
	8.00
	6.00
	6.50
	6.50
	7.0000
	
84.38	31
	6.75
	6.16
	7.80
	6.00
	6.45
	6.45
	7.0000
	
84.39	32
	6.75
	6.12
	7.60
	6.00
	6.40
	6.40
	7.0000
	
85.1	33
	6.75
	6.08
	7.40
	6.00
	6.35
	6.35
	7.0000
	
85.2	34
	6.75
	6.04
	7.20
	6.00
	6.30
	6.30
	7.0000
	
85.3	35
	6.75
	6.00
	7.00
	6.00
	6.25
	6.25
	7.0000
	
85.4	36
	6.75
	5.96
	6.80
	6.00
	6.20
	6.20
	6.9019
	
85.5	37
	6.75
	5.92
	6.60
	6.00
	6.15
	6.15
	6.8074
	
85.6	38
	6.75
	5.88
	6.40
	5.90
	6.10
	6.10
	6.7125
	
85.7	39
	6.75
	5.84
	6.20
	5.80
	6.05
	6.05
	6.6054
	
85.8	40
	6.75
	5.80
	6.00
	5.70
	6.00
	6.00
	6.5000
	
85.9	41
	6.75
	5.76
	5.90
	5.60
	5.90
	5.95
	6.3540
	
85.10	42
	6.75
	5.72
	5.80
	5.50
	5.80
	5.90
	6.2087
	
85.11	43
	6.65
	5.68
	5.70
	5.40
	5.70
	5.85
	6.0622
	
85.12	44
	6.55
	5.64
	5.60
	5.30
	5.60
	5.80
	5.9048
	
85.13	45
	6.45
	5.60
	5.50
	5.20
	5.50
	5.75
	5.7500
	
85.14	46
	6.35
	5.56
	5.45
	5.10
	5.40
	5.70
	5.6940
	
85.15	47
	6.25
	5.52
	5.40
	5.00
	5.30
	5.65
	5.6375
	
85.16	48
	6.15
	5.48
	5.35
	5.00
	5.20
	5.60
	5.5822
	
85.17	49
	6.05
	5.44
	5.30
	5.00
	5.10
	5.55
	5.5404
	
85.18	50
	5.95
	5.40
	5.25
	5.00
	5.00
	5.50
	5.5000
	
85.19	51
	5.85
	5.36
	5.25
	5.00
	5.00
	5.45
	5.4384
	
85.20	52
	5.75
	5.32
	5.25
	5.00
	5.00
	5.40
	5.3776
	
85.21	53
	5.65
	5.28
	5.25
	5.00
	5.00
	5.35
	5.3167
	
85.22	54
	5.55
	5.24
	5.25
	5.00
	5.00
	5.30
	5.2826
	
85.23	55
	5.45
	5.20
	5.25
	5.00
	5.00
	5.25
	5.2500
	
85.24	56
	5.35
	5.16
	5.25
	5.00
	5.00
	5.20
	5.2500
	
85.25	57
	5.25
	5.12
	5.25
	5.00
	5.00
	5.15
	5.2500
	
85.26	58
	5.25
	5.08
	5.25
	5.10
	5.00
	5.10
	5.2500
	
85.27	59
	5.25
	5.04
	5.25
	5.20
	5.00
	5.05
	5.2500
	
85.28	60
	5.25
	5.00
	5.25
	5.30
	5.00
	5.00
	5.2500
	
85.29	61
	5.25
	5.00
	5.25
	5.40
	5.00
	5.00
	5.2500
	
85.30	62
	5.25
	5.00
	5.25
	5.50
	5.00
	5.00
	5.2500
	
85.31	63
	5.25
	5.00
	5.25
	5.60
	5.00
	5.00
	5.2500
	
85.32	64
	5.25
	5.00
	5.25
	5.70
	5.00
	5.00
	5.2500
	
85.33	65
	5.25
	5.00
	5.25
	5.70
	5.00
	5.00
	5.2500
	
85.34	66
	5.25
	5.00
	5.25
	5.70
	5.00
	5.00
	5.2500
	
85.35	67
	5.25
	5.00
	5.25
	5.70
	5.00
	5.00
	5.2500
	
85.36	68
	5.25
	5.00
	5.25
	5.70
	5.00
	5.00
	5.2500
	
85.37	69
	5.25
	5.00
	5.25
	5.70
	5.00
	5.00
	5.2500
	
85.38	70
	5.25
	5.00
	5.25
	5.70
	5.00
	5.00
	5.2500
	
85.39	71
	5.25
	5.00
		5.70

85.40	age
	A
	B
	C
	D
	E
	F
	G
	H
	
85.41	16
	5.95%
	5.95%
	11.00%
	7.70%
	8.00%
	6.90%
	7.7500%
	7.2500%
	
85.42	17
	5.90
	5.90
	11.00
	7.65
	8.00
	6.90
	7.7500
	7.2500
	
85.43	18
	5.85
	5.85
	11.00
	7.60
	8.00
	6.90
	7.7500
	7.2500
	
86.1	19
	5.80
	5.80
	11.00
	7.55
	8.00
	6.90
	7.7500
	7.2500
	
86.2	20
	5.75
	5.40
	11.00
	5.50
	6.90
	6.90
	7.7500
	7.2500
	
86.3	21
	5.75
	5.40
	11.00
	5.50
	6.90
	6.90
	7.1454
	6.6454
	
86.4	22
	5.75
	5.40
	10.50
	5.50
	6.90
	6.90
	7.0725
	6.5725
	
86.5	23
	5.75
	5.40
	10.00
	5.50
	6.85
	6.85
	7.0544
	6.5544
	
86.6	24
	5.75
	5.40
	9.50
	5.50
	6.80
	6.80
	7.0363
	6.5363
	
86.7	25
	5.75
	5.40
	9.00
	5.50
	6.75
	6.75
	7.0000
	6.5000
	
86.8	26
	5.75
	5.36
	8.70
	5.50
	6.70
	6.70
	7.0000
	6.5000
	
86.9	27
	5.75
	5.32
	8.40
	5.50
	6.65
	6.65
	7.0000
	6.5000
	
86.10	28
	5.75
	5.28
	8.10
	5.50
	6.60
	6.60
	7.0000
	6.5000
	
86.11	29
	5.75
	5.24
	7.80
	5.50
	6.55
	6.55
	7.0000
	6.5000
	
86.12	30
	5.75
	5.20
	7.50
	5.50
	6.50
	6.50
	7.0000
	6.5000
	
86.13	31
	5.75
	5.16
	7.30
	5.50
	6.45
	6.45
	7.0000
	6.5000
	
86.14	32
	5.75
	5.12
	7.10
	5.50
	6.40
	6.40
	7.0000
	6.5000
	
86.15	33
	5.75
	5.08
	6.90
	5.50
	6.35
	6.35
	7.0000
	6.5000
	
86.16	34
	5.75
	5.04
	6.70
	5.50
	6.30
	6.30
	7.0000
	6.5000
	
86.17	35
	5.75
	5.00
	6.50
	5.50
	6.25
	6.25
	7.0000
	6.5000
	
86.18	36
	5.75
	4.96
	6.30
	5.50
	6.20
	6.20
	6.9019
	6.4019
	
86.19	37
	5.75
	4.92
	6.10
	5.50
	6.15
	6.15
	6.8074
	6.3074
	
86.20	38
	5.75
	4.88
	5.90
	5.40
	6.10
	6.10
	6.7125
	6.2125
	
86.21	39
	5.75
	4.84
	5.70
	5.30
	6.05
	6.05
	6.6054
	6.1054
	
86.22	40
	5.75
	4.80
	5.50
	5.20
	6.00
	6.00
	6.5000
	6.0000
	
86.23	41
	5.75
	4.76
	5.40
	5.10
	5.90
	5.95
	6.3540
	5.8540
	
86.24	42
	5.75
	4.72
	5.30
	5.00
	5.80
	5.90
	6.2087
	5.7087
	
86.25	43
	5.65
	4.68
	5.20
	4.90
	5.70
	5.85
	6.0622
	5.5622
	
86.26	44
	5.55
	4.64
	5.10
	4.80
	5.60
	5.80
	5.9048
	5.4078
	
86.27	45
	5.45
	4.60
	5.00
	4.70
	5.50
	5.75
	5.7500
	5.2500
	
86.28	46
	5.35
	4.56
	4.95
	4.60
	5.40
	5.70
	5.6940
	5.1940
	
86.29	47
	5.25
	4.52
	4.90
	4.50
	5.30
	5.65
	5.6375
	5.1375
	
86.30	48
	5.15
	4.48
	4.85
	4.50
	5.20
	5.60
	5.5822
	5.0822
	
86.31	49
	5.05
	4.44
	4.80
	4.50
	5.10
	5.55
	5.5404
	5.0404
	
86.32	50
	4.95
	4.40
	4.75
	4.50
	5.00
	5.50
	5.5000
	5.0000
	
86.33	51
	4.85
	4.36
	4.75
	4.50
	4.90
	5.45
	5.4384
	4.9384
	
86.34	52
	4.75
	4.32
	4.75
	4.50
	4.80
	5.40
	5.3776
	4.8776
	
86.35	53
	4.65
	4.28
	4.75
	4.50
	4.70
	5.35
	5.3167
	4.8167
	
86.36	54
	4.55
	4.24
	4.75
	4.50
	4.60
	5.30
	5.2826
	4.7826
	
86.37	55
	4.45
	4.20
	4.75
	4.50
	4.50
	5.25
	5.2500
	4.7500
	
86.38	56
	4.35
	4.16
	4.75
	4.50
	4.40
	5.20
	5.2500
	4.7500
	
86.39	57
	4.25
	4.12
	4.75
	4.50
	4.30
	5.15
	5.2500
	4.7500
	
86.40	58
	4.25
	4.08
	4.75
	4.60
	4.20
	5.10
	5.2500
	4.7500
	
86.41	59
	4.25
	4.04
	4.75
	4.70
	4.10
	5.05
	5.2500
	4.7500
	
86.42	60
	4.25
	4.00
	4.75
	4.80
	4.00
	5.00
	5.2500
	4.7500
	
86.43	61
	4.25
	4.00
	4.75
	4.90
	3.90
	5.00
	5.2500
	4.7500
	
87.1	62
	4.25
	4.00
	4.75
	5.00
	3.80
	5.00
	5.2500
	4.7500
	
87.2	63
	4.25
	4.00
	4.75
	5.10
	3.70
	5.00
	5.2500
	4.7500
	
87.3	64
	4.25
	4.00
	4.75
	5.20
	3.60
	5.00
	5.2500
	4.7500
	
87.4	65
	4.25
	4.00
	4.75
	5.20
	3.50
	5.00
	5.2500
	4.7500
	
87.5	66
	4.25
	4.00
	4.75
	5.20
	3.50
	5.00
	5.2500
	4.7500
	
87.6	67
	4.25
	4.00
	4.75
	5.20
	3.50
	5.00
	5.2500
	4.7500
	
87.7	68
	4.25
	4.00
	4.75
	5.20
	3.50
	5.00
	5.2500
	4.7500
	
87.8	69
	4.25
	4.00
	4.75
	5.20
	3.50
	5.00
	5.2500
	4.7500
	
87.9	70
	4.25
	4.00
	4.75
	5.20
	3.50
	5.00
	5.2500
	4.7500
	
87.10	71
	4.25
	4.00
		5.20
					
87.11 	(c) Before July 2, 2010, the actuarial valuation must use the applicable following 
87.12 	payroll growth assumption for calculating the amortization requirement for the unfunded 
87.13 	actuarial accrued liability where the amortization retirement is calculated as a level 
87.14 	percentage of an increasing payroll:

87.15		payroll growth
	
87.16	plan
	assumption

87.17	general state employees retirement plan
		5.004.50%
	
87.18	correctional state employees retirement plan
		5.004.50
	
87.19	State Patrol retirement plan
		5.004.50
	
87.20	legislators retirement plan
		5.004.50
	
87.21	elective state officers retirement plan
		5.00
	
87.22	judges retirement plan
		5.004.00
	
87.23	general public employees retirement plan
		6.004.50
	
87.24
87.25	public employees police and fire retirement 
plan
		6.004.50
	
87.26
87.27	local government correctional service 
retirement plan
		6.004.50
	
87.28	teachers retirement plan
		5.004.50
	
87.29	Duluth teachers retirement plan
		5.004.50
	
87.30	St. Paul teachers retirement plan
		5.00
	
87.31 	(d) After July 1, 2010, the assumptions set forth in paragraphs (b) and (c) continue to 
87.32 	apply, unless a different salary assumption or a different payroll increase assumption:
87.33 	(1) has been proposed by the governing board of the applicable retirement plan;
87.34 	(2) is accompanied by the concurring recommendation of the actuary retained under 
87.35 	section 356.214, subdivision 1, if applicable, or by the approved actuary preparing the 
87.36 	most recent actuarial valuation report if section 356.214 does not apply; and
87.37 	(3) has been approved or deemed approved under subdivision 18.

87.38 	Sec. 14. Minnesota Statutes 2006, section 356.215, subdivision 11, is amended to read:
88.1 		Subd. 11.Amortization contributions. (a) In addition to the exhibit indicating the 
88.2 	level normal cost, the actuarial valuation of the retirement plan must contain an exhibit 
88.3 	for financial reporting purposes indicating the additional annual contribution sufficient 
88.4 	to amortize the unfunded actuarial accrued liability and must contain an exhibit for 
88.5 	contribution determination purposes indicating the additional contribution sufficient to 
88.6 	amortize the unfunded actuarial accrued liability. For funds governed by chapters 3A, 
88.7 	352, 352B, 352C, 353, 354, 354A, and 490 the retirement plans listed in subdivision 8, 
88.8 	paragraph (c), the additional contribution must be calculated on a level percentage of 
88.9 	covered payroll basis by the established date for full funding in effect when the valuation 
88.10 	is prepared. For funds governed by chapter 3A, sections 352.90 through 352.951, chapters 
88.11 	352B, 352C, sections 353.63 through 353.68, and chapters 353C, 354A, and 490, the level 
88.12 	percent additional contribution must be calculated, assuming annual payroll growth of 6.5 
88.13 	percent. For funds governed by sections 352.01 through 352.86 and chapter 354, the level 
88.14 	percent additional contribution must be calculated assuming an annual payroll growth of 
88.15 	five percent. For the fund governed by sections 353.01 through 353.46, the level percent 
88.16 	additional contribution must be calculated assuming an annual payroll growth of six 
88.17 	percent at the applicable percentage rate set forth in subdivision 8, paragraph (c). For all 
88.18 	other funds retirement plans, the additional annual contribution must be calculated on a 
88.19 	level annual dollar amount basis. 
88.20 	(b) For any fundretirement plan other than the Minneapolis Employees Retirement 
88.21 	Fund and, the general employees retirement plan of the Public Employees Retirement 
88.22 	Association general plan, and the St. Paul Teachers Retirement Fund Association, if 
88.23 	there has not been a change in the actuarial assumptions used for calculating the actuarial 
88.24 	accrued liability of the fund, a change in the benefit plan governing annuities and benefits 
88.25 	payable from the fund, a change in the actuarial cost method used in calculating the 
88.26 	actuarial accrued liability of all or a portion of the fund, or a combination of the three, 
88.27 	which change or changes by itself or by themselves without inclusion of any other items 
88.28 	of increase or decrease produce a net increase in the unfunded actuarial accrued liability of 
88.29 	the fund, the established date for full funding is the first actuarial valuation date occurring 
88.30 	after June 1, 2020.
88.31 	(c) For any fund orretirement plan other than the Minneapolis Employees 
88.32 	Retirement Fund and the general employees retirement plan of the Public Employees 
88.33 	Retirement Association general plan, if there has been a change in any or all of the 
88.34 	actuarial assumptions used for calculating the actuarial accrued liability of the fund, a 
88.35 	change in the benefit plan governing annuities and benefits payable from the fund, a 
88.36 	change in the actuarial cost method used in calculating the actuarial accrued liability of all 
89.1 	or a portion of the fund, or a combination of the three, and the change or changes, by itself 
89.2 	or by themselves and without inclusion of any other items of increase or decrease, produce 
89.3 	a net increase in the unfunded actuarial accrued liability in the fund, the established date 
89.4 	for full funding must be determined using the following procedure:
89.5 	(i) the unfunded actuarial accrued liability of the fund must be determined in 
89.6 	accordance with the plan provisions governing annuities and retirement benefits and the 
89.7 	actuarial assumptions in effect before an applicable change;
89.8 	(ii) the level annual dollar contribution or level percentage, whichever is applicable, 
89.9 	needed to amortize the unfunded actuarial accrued liability amount determined under item 
89.10 	(i) by the established date for full funding in effect before the change must be calculated 
89.11 	using the interest assumption specified in subdivision 8 in effect before the change;
89.12 	(iii) the unfunded actuarial accrued liability of the fund must be determined in 
89.13 	accordance with any new plan provisions governing annuities and benefits payable from 
89.14 	the fund and any new actuarial assumptions and the remaining plan provisions governing 
89.15 	annuities and benefits payable from the fund and actuarial assumptions in effect before 
89.16 	the change;
89.17 	(iv) the level annual dollar contribution or level percentage, whichever is applicable, 
89.18 	needed to amortize the difference between the unfunded actuarial accrued liability amount 
89.19 	calculated under item (i) and the unfunded actuarial accrued liability amount calculated 
89.20 	under item (iii) over a period of 30 years from the end of the plan year in which the 
89.21 	applicable change is effective must be calculated using the applicable interest assumption 
89.22 	specified in subdivision 8 in effect after any applicable change;
89.23 	(v) the level annual dollar or level percentage amortization contribution under item 
89.24 	(iv) must be added to the level annual dollar amortization contribution or level percentage 
89.25 	calculated under item (ii);
89.26 	(vi) the period in which the unfunded actuarial accrued liability amount determined 
89.27 	in item (iii) is amortized by the total level annual dollar or level percentage amortization 
89.28 	contribution computed under item (v) must be calculated using the interest assumption 
89.29 	specified in subdivision 8 in effect after any applicable change, rounded to the nearest 
89.30 	integral number of years, but not to exceed 30 years from the end of the plan year in 
89.31 	which the determination of the established date for full funding using the procedure set 
89.32 	forth in this clause is made and not to be less than the period of years beginning in the 
89.33 	plan year in which the determination of the established date for full funding using the 
89.34 	procedure set forth in this clause is made and ending by the date for full funding in effect 
89.35 	before the change; and
90.1 	(vii) the period determined under item (vi) must be added to the date as of which 
90.2 	the actuarial valuation was prepared and the date obtained is the new established date 
90.3 	for full funding.
90.4 	(d) For the Minneapolis Employees Retirement Fund, the established date for full 
90.5 	funding is June 30, 2020.
90.6 	(e) For the general employees retirement plan of the Public Employees Retirement 
90.7 	Association, the established date for full funding is June 30, 2031.
90.8 	(f) For the Teachers Retirement Association, the established date for full funding is 
90.9 	June 30, 2037.
90.10 	(g) For the correctional state employees retirement plan of the Minnesota State 
90.11 	Retirement System, the established date for full funding is June 30, 2038.
90.12 	(h) For the judges retirement plan, the established date for full funding is June 
90.13 	30, 2038.
90.14 	(i) For the public employees police and fire retirement plan, the established date 
90.15 	for full funding is June 30, 2038.
90.16 	(j) For the St. Paul Teachers Retirement Fund Association, the established date for 
90.17 	full funding is June 30 of the 25th year from the valuation date. In addition to other 
90.18 	requirements of this chapter, the annual actuarial valuation shall contain an exhibit 
90.19 	indicating the funded ratio and the deficiency or sufficiency in annual contributions when 
90.20 	comparing liabilities to the market value of the assets of the fund as of the close of the 
90.21 	most recent fiscal year.
90.22 	(g)(k) For the retirement plans for which the annual actuarial valuation indicates 
90.23 	an excess of valuation assets over the actuarial accrued liability, the valuation assets in 
90.24 	excess of the actuarial accrued liability must be recognized as a reduction in the current 
90.25 	contribution requirements by an amount equal to the amortization of the excess expressed 
90.26 	as a level percentage of pay over a 30-year period beginning anew with each annual 
90.27 	actuarial valuation of the plan.
90.28 	(l) In addition to calculating the unfunded actuarial accrued liability of the retirement 
90.29 	plan for financial reporting purposes under paragraphs (a) to (j), the actuarial valuation 
90.30 	of the retirement plan must also include a calculation of the unfunded actuarial accrued 
90.31 	liability of the retirement plan for purposes of determining the amortization contribution 
90.32 	sufficient to amortize the unfunded actuarial liability of the Minnesota Post Retirement 
90.33 	Investment Fund. For this exhibit, the calculation must be the unfunded actuarial accrued 
90.34 	liability net of the postretirement adjustment liability funded from the investment 
90.35 	performance of the Minnesota Post Retirement Investment Fund or the retirement benefit 
90.36 	fund.

91.1 	Sec. 15. Minnesota Statutes 2006, section 356.215, subdivision 18, is amended to read:
91.2 		Subd. 18.Establishment of actuarial assumptions. (a) Before July 2, 2010, the 
91.3 	actuarial assumptions used for the preparation of actuarial valuations under this section 
91.4 	that are other than those set forth in this sectionpreretirement interest, postretirement 
91.5 	interest, salary increase, and payroll increase may be changed only with the approval of 
91.6 	the Legislative Commission on Pensions and Retirement or after a period of one year has 
91.7 	elapsed since the date on which the proposed assumption change or changes were received 
91.8 	by the Legislative Commission on Pensions and Retirement without commission action.
91.9 	(b) After July 1, 2010, the actuarial assumptions used for the preparation of actuarial 
91.10 	valuations under this section that are other than postretirement interest and preretirement 
91.11 	interest may be changed only with the approval of the Legislative Commission on 
91.12 	Pensions and Retirement or after a period of one year has elapsed since the date on which 
91.13 	the proposed assumption change or changes were received by the Legislative Commission 
91.14 	on Pensions and Retirement without commission action.
91.15 	(b)(c) A change in the applicable actuarial assumptions may be proposed by the 
91.16 	governing board of the applicable pension fund or relief association, by the actuary 
91.17 	retained by the joint retirement systems under section   356.214, by the actuarial advisor to 
91.18 	a pension fund governed by chapter 352, 353, 354, or 354A, or by the actuary retained by 
91.19 	a local police or firefighters relief association governed by sections   69.77 or   69.771 to   
91.20 	69.776, if one is retained. 

91.21 	Sec. 16. Minnesota Statutes 2007 Supplement, section 356.96, subdivision 1, is 
91.22 	amended to read:
91.23 		Subdivision 1.Definitions. (a) Unless the language or context clearly indicates that 
91.24 	a different meaning is intended, for the purpose of this section, the terms in paragraphs 
91.25 	(b) to (e) have the meanings given them.
91.26 	(b) "Chief administrative officer" means the executive director of a covered pension 
91.27 	plan or the executive director's designee or representative.
91.28 	(c) "Covered pension plan" means a plan enumerated in section 356.20, subdivision 
91.29 	2, clauses (1) to (4), (10), and (12) to (14) (13) to (15), but does not mean the deferred 
91.30 	compensation plan administered under sections 352.96 and 352.97 or to the postretirement 
91.31 	health care savings plan administered under section 352.98.
91.32 	(d) "Governing board" means the Board of Trustees of the Public Employees 
91.33 	Retirement Association, the Board of Trustees of the Teachers Retirement Association, or 
91.34 	the Board of Directors of the Minnesota State Retirement System.
92.1 	(e) "Person" includes an active, retired, deferred, or nonvested inactive participant in 
92.2 	a covered pension plan  or a beneficiary of a participant, or an individual who has applied 
92.3 	to be a participant or who is or may be a survivor of a participant, or a state agency or 
92.4 	other governmental unit that employs active participants in a covered  pension plan.

92.5 	Sec. 17. APPROPRIATION; LEGISLATIVE COMMISSION ON PENSIONS 
92.6 	AND RETIREMENT.
 92.7 	$140,000 is appropriated from the general fund to the Legislative Commission on 
92.8 	Pensions and Retirement in fiscal year 2009 in order to cover the costs of any contract 
92.9 	authorized under Minnesota Statutes, section 356.214, subdivision 4. The commissioner 
92.10 	of finance must include these funds in the base level funding for the commission when 
92.11 	preparing forecasts of general fund spending and revenue and initial budget estimates 
92.12 	each biennium, as long as an actuary remains under contract to the commission under 
92.13 	Minnesota Statutes, section 356.214, subdivision 4.

92.14 	Sec. 18.  REPEALER.
 92.15 	Minnesota Statutes 2006, sections 356.214, subdivision 2; and 356.215, subdivision 
92.16 	2a, are repealed.

92.17 	Sec. 19. EFFECTIVE DATE.
 92.18 	Sections 1 to 18 are effective June 30, 2008, and apply to annual financial reports 
92.19 	and actuarial valuations prepared after June 1, 2008.

92.20 	ARTICLE 12
92.21 	RETIREMENT SAVINGS PROGRAMS

92.22 	Section 1. Minnesota Statutes 2006, section 123B.02, subdivision 15, is amended to 
92.23 	read:
92.24 		Subd. 15.Annuity contract; payroll allocation. At the request of an employee 
92.25 	and as part of the employee's compensation arrangement, the board may purchase an 
92.26 	individual annuity contract for an employee for retirement or other purposes and may 
92.27 	make payroll allocations in accordance with such arrangement for the purpose of paying 
92.28 	the entire premium due and to become due under such contract. The allocation must be 
92.29 	made in a manner which will qualify the annuity premiums, or a portion thereof, for 
92.30 	the benefit afforded under section 403(b) of the current Federal Internal Revenue Code 
92.31 	or any equivalent provision of subsequent federal income tax law. The employee shall 
92.32 	own such contract and the employee's rights under the contract shall be nonforfeitable 
93.1 	except for failure to pay premiums. Section 122A.40 shall not be applicable hereto and the 
93.2 	board shall have no liability thereunder because of its purchase of any individual annuity 
93.3 	contracts. This statute shall be applied in a nondiscriminatory manner to employees of the 
93.4 	school district. The identity and number of the available vendors under section 403(b) of 
93.5 	the Internal Revenue Code is a term and condition of employment under section 179A.03.

93.6 	EFFECTIVE DATE. This section is effective August 1, 2008.

93.7 	Sec. 2. Minnesota Statutes 2006, section 352.03, subdivision 4, is amended to read:
93.8 		Subd. 4.Duties and powers of board of directors. The board shall:
93.9 	(1) elect a chair;
93.10 	(2) appoint an executive director;
93.11 	(3) establish rules to administer this chapter and chapters 3A, 352B, 352C, 352D, 
93.12 	and 490 and transact the business of the system, subject to the limitations of law;
93.13 	(4) consider and dispose of, or take any other action the board of directors deems 
93.14 	appropriate concerning denials of applications for annuities or disability benefits under 
93.15 	this chapter, and complaints of employees and others pertaining to the retirement of 
93.16 	employees and the operation of the system;
93.17 	(5) advise the director on any matters relating to the system and carrying out 
93.18 	functions and purposes of this chapter. The board's advice shall control; and
93.19 	(6) oversee the administration of the state deferred compensation plan established in 
93.20 	section 352.96 352.965. 
93.21 	The director and assistant director must be in the unclassified service but appointees 
93.22 	may be selected from civil service lists if desired. The salary of the executive director 
93.23 	must be as provided by section 15A.0815. The salary of the assistant director must be set 
93.24 	in accordance with section 43A.18, subdivision 3. 

93.25 	EFFECTIVE DATE. This section is effective August 1, 2008.

93.26 	Sec. 3. [352.965] MINNESOTA STATE DEFERRED COMPENSATION PLAN.
93.27 		Subdivision 1.Establishment. (a) The Minnesota state deferred compensation plan 
93.28 	is established. For purposes of this section, "plan" means the Minnesota state deferred 
93.29 	compensation plan, unless the context clearly indicates otherwise. The Minnesota State 
93.30 	Retirement System shall administer the plan.
93.31 	(b) The purpose of the plan is to provide a means for a public employee to contribute 
93.32 	a portion of the employee's compensation to a tax-deferred investment account. The plan 
93.33 	is an eligible tax-deferred compensation plan under section 457(b) of the Internal Revenue 
94.1 	Code, United States Code, title 26, section 457(b), and the applicable regulations under 
94.2 	Code of Federal Regulations, title 26, parts 1.457-3 to 1.457-10.
94.3 	(c) The board of directors of the Minnesota State Retirement System is the plan 
94.4 	trustee and the board's executive director is the plan administrator. Fiduciary activities of 
94.5 	the plan must be undertaken in a manner consistent with chapter 356A.
94.6 	(d) The executive director, with the approval of the board of directors, shall 
94.7 	adopt and amend, as required to maintain tax-qualified status, a written plan document 
94.8 	specifying the material terms and conditions for eligibility, benefits, applicable limitations, 
94.9 	and the time and form under which benefit distributions can be made. With the approval 
94.10 	of the board of directors, the executive director may also establish policies and procedures 
94.11 	necessary for the administration of the deferred compensation plan.
94.12 	(e) The plan document shall include provisions that are necessary to cause the plan 
94.13 	to be an eligible deferred compensation plan within the meaning of section 457(b) of 
94.14 	the Internal Revenue Code. The plan document may provide additional administrative 
94.15 	and substantive provisions consistent with state law, provided those provisions will not 
94.16 	cause the plan to fail to be an eligible deferred compensation plan within the meaning 
94.17 	of section 457(b) of the Internal Revenue Code and may include provisions for certain 
94.18 	optional features and services.
94.19 	(f) The board of directors may authorize the executive director to establish and 
94.20 	administer a Roth 457 plan if authorized by the Internal Revenue Code or a Roth 
94.21 	individual retirement account as defined under section 408A of the Internal Revenue Code.
94.22 	(g) All amounts contributed to the deferred compensation plan and all earnings 
94.23 	on those amounts must be held in trust, in custodial accounts, or in qualifying annuity 
94.24 	contracts for the exclusive benefit of the plan participants and beneficiaries, as required by 
94.25 	section 457(g) of the Internal Revenue Code and in accordance with sections 356.001 and 
94.26 	356A.06, subdivision 1.
94.27 	(h) The information and data maintained in the accounts of the participants and 
94.28 	beneficiaries are private data and shall not be disclosed to anyone other than the participant 
94.29 	or beneficiary pursuant to a court order or pursuant to section 356.49.
94.30 	(i) The plan document is not subject to the rule adoption process under the 
94.31 	Administrative Procedures Act, including section 14.386, but must conform with 
94.32 	applicable federal and state laws.
94.33 		Subd. 2.Right to participate in the deferred compensation plan. At the request 
94.34 	of an officer or employee of the state, an officer or employee of a political subdivision, or 
94.35 	an employee covered by a retirement fund in section 356.20, subdivision 2, the appointing 
94.36 	authority shall defer the payment of part of the compensation of the public officer or 
95.1 	employee through payroll deduction. The amount to be deferred must be as provided 
95.2 	in a written agreement between the officer or employee and the public employer. The 
95.3 	agreement must be in a form specified by the executive director of the Minnesota State 
95.4 	Retirement System and must be consistent with the requirements for an eligible plan under 
95.5 	federal and state tax laws, regulations, and rulings.
95.6 		Subd. 3.Failure to implement plan. The public employer must complete 
95.7 	implementation of the deferred compensation plan within 45 days of the request as 
95.8 	provided in subdivision 2. If the public employer fails to implement the deferred 
95.9 	compensation plan, the public employer may not defer compensation under any existing 
95.10 	or new deferred compensation plan from the date of the request until the date on which the 
95.11 	deferred compensation plan provided for in this section is implemented. Upon the petition 
95.12 	of a public officer or employee, the executive director of the Minnesota State Retirement 
95.13 	System may order the public officer's or employee's public employer to implement the 
95.14 	deferred compensation plan provided for in this section and may enforce that order 
95.15 	in appropriate legal proceedings.
95.16 		Subd. 4.Plan investments. (a) Investments under the plan may include:
95.17 	(1) shares in the Minnesota supplemental investment fund established in section 
95.18 	11A.17 that are selected to be offered under the plan by the State Board of Investment;
95.19 	(2) saving accounts in federally insured financial institutions;
95.20 	(3) life insurance contracts, fixed annuity, and variable annuity contracts from 
95.21 	companies that are subject to regulation by the commissioner of commerce;
95.22 	(4) investment options from open-end investment companies registered under the 
95.23 	federal Investment Company Act of 1940, United States Code, title 15, sections 80a-1 
95.24 	to 80a-64;
95.25 	(5) investment options from a firm that is a registered investment advisor under the 
95.26 	Investment Advisers Act of 1940, United States Code, title 15, sections 80b-1 to 80b-21;
95.27 	(6) investment options of a bank as defined in United States Code, title 15, section 
95.28 	80b-2, subsection (a), paragraph (2), or a bank holding company as defined in the Bank 
95.29 	Holding Company Act of 1956, United States Code, title 12, section 1841, subsection 
95.30 	(a), paragraph (1); or
95.31 	(7) a combination of clause (1), (2), (3), (4), (5), or (6), as provided by the plan as 
95.32 	specified by the participant.
95.33 	(b) All amounts contributed to the deferred compensation plan and all earnings 
95.34 	on those amounts must be held for the exclusive benefit of the plan participants and 
95.35 	beneficiaries. These amounts must be held in trust, in custodial accounts, or in qualifying 
95.36 	annuity contracts as required by federal law in accordance with section 356A.06, 
96.1 	subdivision 1. This subdivision does not authorize an employer contribution, except as 
96.2 	authorized in section 356.24, subdivision 1, paragraph (a), clause (5). The state, political 
96.3 	subdivision, or other employing unit is not responsible for any loss that may result from 
96.4 	investment of the deferred compensation.
96.5 		Subd. 5.State Board of Investment to determine investments. (a) The State 
96.6 	Board of Investment shall determine the investment products to be made available under 
96.7 	the plan and may retain appropriate consulting services to assist in making the selections. 
96.8 	At a minimum, the State Board of Investment shall consider the following:
96.9 	(1) the experience and ability of the financial institution to provide benefits and 
96.10 	products that are suited to meet the needs of plan participants;
96.11 	(2) the relationship of those benefits and products provided by the financial 
96.12 	institution to their cost;
96.13 	(3) the financial strength and stability of the financial institution; and
96.14 	(4) the fees and expenses associated with the investment products in comparison to 
96.15 	other products of similar risk and rates of return.
96.16 	(b) If the State Board of Investment so elects, it may solicit bids for options under 
96.17 	subdivision 4, clauses (2), (3), (4), (5), and (6). The State Board of Investment may retain 
96.18 	consulting services to assist in soliciting and evaluating bids and in the periodic review of 
96.19 	companies offering options under subdivision 4, clauses (3), (4), (5), and (6). The periodic 
96.20 	review must occur at least every two years. The State Board of Investment may annually 
96.21 	establish a budget for its costs in soliciting, evaluation, and periodic review processes. All 
96.22 	options in subdivision 4 must be presented in an unbiased manner and in a manner that 
96.23 	conforms to rules adopted by the executive director, be reported on a periodic basis to all 
96.24 	participants in the deferred compensation plan, and not be the subject of unreasonable 
96.25 	solicitation of participants in the plan. The State Board of Investment may charge a 
96.26 	proportional share of all costs related to the periodic review to each company currently 
96.27 	under contract and may charge a proportional share of all costs related to soliciting and 
96.28 	evaluating bids to each company selected by the State Board of Investment.
96.29 	(c) Under the procedures set forth in the plan document, participants may select the 
96.30 	funds or combination of funds within which to invest and may reallocate those investments 
96.31 	as provided in the plan document and procedures established by the executive director.
96.32 	(d) This section does not authorize an employer contribution, except as authorized in 
96.33 	section 356.24, subdivision 1, paragraph (a), clause (5).
96.34 	(e) The state, the Minnesota State Retirement System, the executive director and 
96.35 	board of directors of the system, the State Board of Investment, and participating public 
97.1 	employers are not liable and not responsible for any loss that may result from investment 
97.2 	of the deferred compensation or the investment choices made by the participants.
97.3 		Subd. 6.Plan administrative expenses. (a) The reasonable and necessary 
97.4 	administrative expenses of the deferred compensation plan may be charged to plan 
97.5 	participants in the form of an annual fee, an asset-based fee, a percentage of the 
97.6 	contributions to the plan, or a combination thereof, as set forth in the plan document. The 
97.7 	executive director of the system at the direction of the board of directors shall establish 
97.8 	procedures to carry out this section including allocation of administrative costs of the plan 
97.9 	to participants. Processes and procedures shall be set forth in the plan document. Fees 
97.10 	cannot be charged on contributions and investment returns attributable to contributions 
97.11 	made to the Minnesota supplemental investment funds before July 1, 1992. 
97.12 	(b) The plan document must conform to federal and state tax laws, regulations, and 
97.13 	rulings, and is not subject to the Administrative Procedure Act.
97.14 	(c) The executive director may contract with a third party to perform administrative 
97.15 	and record keeping functions. The executive director may solicit bids and negotiate such 
97.16 	contracts.
97.17 	(d) The board of directors may authorize a third-party investment consultant to 
97.18 	provide investment information and advice, provided that the offering of such information 
97.19 	and advice is consistent with the investment advice requirements applicable to private 
97.20 	plans under Title VI, subtitle A, of the Pension Protection Act of 2006, Public Law 
97.21 	109-280, section 601.
97.22 		Subd. 7.Other laws not applicable. Except as provided in this section, no 
97.23 	provisions of this chapter or other law specifically referring to this chapter applies to this 
97.24 	section unless the Minnesota deferred compensation plan is specifically referenced.
97.25 		Subd. 8.Exemption from process. No amount of deferred compensation is 
97.26 	assignable or subject to execution, levy, attachment, garnishment, or other legal process, 
97.27 	except as provided in section 518.58, 518.581, or 518A.53.
97.28 		Subd. 9.Missing participants. The plan document shall establish procedures to 
97.29 	assist in locating participants. If a participant cannot be located the participant's benefits 
97.30 	shall be deemed abandoned and the provisions of section 356.65 shall apply to their 
97.31 	disposition.

97.32 	EFFECTIVE DATE. This section is effective August 1, 2008.

97.33 	Sec. 4. Minnesota Statutes 2006, section 352.97, is amended to read:
97.34 	352.97 PRIOR DEFERRED COMPENSATION PLANS; CONSTRUCTION.
98.1 	Sections 352.96 352.965 and 352.97 do not preempt, prohibit, ratify, or approve any 
98.2 	other deferred compensation plan established before or after June 3, 1975. 

98.3 	Sec. 5. Minnesota Statutes 2006, section 353D.12, subdivision 4, is amended to read:
98.4 		Subd. 4.Authorized rollovers. To the extent allowed by federal law, the employee 
98.5 	purchase amount may be made with funds distributed from: (1) a plan qualified under 
98.6 	section 401(a) of the federal Internal Revenue Code, as amended; (2) an annuity qualified 
98.7 	under section 403(a) of the federal Internal Revenue Code, as amended; (3) an individual 
98.8 	retirement account used solely to receive a nontaxable rollover from that type of plan or 
98.9 	annuity; (4) the state deferred compensation plan authorized under section 352.96 352.965
98.10 	and qualified under section 457 of the federal Internal Revenue Code, as amended; or (5) 
98.11 	another tax qualified plan or annuity that authorizes rollovers. The participating elected 
98.12 	local government official shall supply sufficient written documentation that the transfer 
98.13 	amounts are eligible for tax-free rollover treatment. An authorized tax-free rollover, plus 
98.14 	any other purchase amount payments under this section, including subdivision 6, may not 
98.15 	exceed the limitation in subdivision 2, paragraph (a). Notwithstanding any provision of 
98.16 	state law or rule to the contrary, to the extent permitted under federal law, the employee 
98.17 	purchase amount may be transferred from the state deferred compensation plan before the 
98.18 	employee terminates public employment. 

98.19 	EFFECTIVE DATE. This section is effective August 1, 2008.

98.20 	Sec. 6. Minnesota Statutes 2006, section 356.24, subdivision 1, is amended to read:
98.21 		Subdivision 1.Restriction; exceptions. (a) It is unlawful for a school district 
98.22 	or other governmental subdivision or state agency to levy taxes for, or to contribute 
98.23 	public funds to a supplemental pension or deferred compensation plan that is established, 
98.24 	maintained, and operated in addition to a primary pension program for the benefit of the 
98.25 	governmental subdivision employees other than:
98.26 	(1) to a supplemental pension plan that was established, maintained, and operated 
98.27 	before May 6, 1971;
98.28 	(2) to a plan that provides solely for group health, hospital, disability, or death 
98.29 	benefits;
98.30 	(3) to the individual retirement account plan established by chapter 354B;
98.31 	(4) to a plan that provides solely for severance pay under section 465.72 to a retiring 
98.32 	or terminating employee; 
98.33 	(5) for employees other than personnel employed by the Board of Trustees of the 
98.34 	Minnesota State Colleges and Universities and covered under the Higher Education 
99.1 	Supplemental Retirement Plan under chapter 354C, but including city managers covered 
99.2 	by an alternative retirement arrangement under section 353.028, subdivision 3, paragraph 
99.3 	(a), or by the defined contribution plan of the Public Employees Retirement Association 
99.4 	under section 353.028, subdivision 3, paragraph (b), if the supplemental plan coverage is 
99.5 	provided for in a personnel policy of the public employer or in the collective bargaining 
99.6 	agreement between the public employer and the exclusive representative of public 
99.7 	employees in an appropriate unit or in the individual employment contract between a city 
99.8 	and a city manager, and if for each available investment all fees and historic rates of return 
99.9 	for the prior one-, three-, five-, and ten-year periods, or since inception, are disclosed in an 
99.10 	easily comprehended document not to exceed two pages, in an amount matching employee 
99.11 	contributions on a dollar for dollar basis, but not to exceed an employer contribution of 
99.12 	$2,000 a one-half of the available elective deferral permitted per year per employee, 
99.13 	under the Internal Revenue Code:
99.14 	(i) to the state of Minnesota deferred compensation plan under section 352.96
99.15 	352.965; or
99.16 	(ii) in payment of the applicable portion of the contribution made to any investment 
99.17 	eligible under section 403(b) of the Internal Revenue Code, if the employing unit has 
99.18 	complied with any applicable pension plan provisions of the Internal Revenue Code with 
99.19 	respect to the tax-sheltered annuity program during the preceding calendar year; or
99.20 	(iii) any other deferred compensation plan offered by the employer under section 
99.21 	457 of the Internal Revenue Code;
99.22 	(6) for personnel employed by the Board of Trustees of the Minnesota State Colleges 
99.23 	and Universities and not covered by clause (5), to the supplemental retirement plan under 
99.24 	chapter 354C, if the supplemental plan coverage is provided for in a personnel policy 
99.25 	or in the collective bargaining agreement of the public employer with the exclusive 
99.26 	representative of the covered employees in an appropriate unit, in an amount matching 
99.27 	employee contributions on a dollar for dollar basis, but not to exceed an employer 
99.28 	contribution of $2,700 a year for each employee;
99.29 	(7) to a supplemental plan or to a governmental trust to save for postretirement 
99.30 	health care expenses qualified for tax-preferred treatment under the Internal Revenue 
99.31 	Code, if the supplemental plan coverage is provided for in a personnel policy or in the 
99.32 	collective bargaining agreement of a public employer with the exclusive representative of 
99.33 	the covered employees in an appropriate unit;
99.34 	(8) to the laborers national industrial pension fund or to a laborers local pension 
99.35 	fund for the employees of a governmental subdivision who are covered by a collective 
99.36 	bargaining agreement that provides for coverage by that fund and that sets forth a fund 
100.1 	contribution rate, but not to exceed an employer contribution of $5,000 per year per 
100.2 	employee;
100.3 	(9) to the plumbers and pipefitters national pension fund or to a plumbers and 
100.4 	pipefitters local pension fund for the employees of a governmental subdivision who are 
100.5 	covered by a collective bargaining agreement that provides for coverage by that fund and 
100.6 	that sets forth a fund contribution rate, but not to exceed an employer contribution of 
100.7 	$5,000 per year per employee;
100.8 	(10) to the international union of operating engineers pension fund for the employees 
100.9 	of a governmental subdivision who are covered by a collective bargaining agreement that 
100.10 	provides for coverage by that fund and that sets forth a fund contribution rate, but not to 
100.11 	exceed an employer contribution of $5,000 per year per employee; 
100.12 	(11) to a supplemental plan organized and operated under the federal Internal 
100.13 	Revenue Code, as amended, that is wholly and solely funded by the employee's 
100.14 	accumulated sick leave, accumulated vacation leave, and accumulated severance pay; or
100.15 	(12) to the International Association of Machinists national pension fund for the 
100.16 	employees of a governmental subdivision who are covered by a collective bargaining 
100.17 	agreement that provides for coverage by that fund and that sets forth a fund contribution 
100.18 	rate, but not to exceed an employer contribution of $5,000 per year per employee.; or
100.19 	(13) for employees of United Hospital District, Blue Earth, to the state of Minnesota 
100.20 	deferred compensation program, if the employee makes a contribution, in an amount that 
100.21 	does not exceed the total percentage of covered salary under section 353.27, subdivisions 
100.22 	3 and 3a.
100.23 	(b) No governmental subdivision may make a contribution to a deferred 
100.24 	compensation plan operating under section 457 of the Internal Revenue Code for volunteer 
100.25 	or emergency on-call firefighters in lieu of providing retirement coverage under the federal 
100.26 	old age, survivors, and disability insurance program.

100.27 	EFFECTIVE DATE. Paragraph (a), clause (13), is effective July 1, 2008. The 
100.28 	balance of this section is effective August 1, 2008.

100.29 	Sec. 7. Minnesota Statutes 2007 Supplement, section 356.96, subdivision 1, is 
100.30 	amended to read:
100.31 		Subdivision 1.Definitions. (a) Unless the language or context clearly indicates that 
100.32 	a different meaning is intended, for the purpose of this section, the terms in paragraphs 
100.33 	(b) to (e) have the meanings given them.
100.34 	(b) "Chief administrative officer" means the executive director of a covered pension 
100.35 	plan or the executive director's designee or representative.
101.1 	(c) "Covered pension plan" means a plan enumerated in section 356.20, subdivision 
101.2 	2, clauses (1) to (4), (10), and (12) to (14), but does not mean the deferred compensation 
101.3 	plan administered under sections 352.96 352.965 and 352.97 or to the postretirement 
101.4 	health care savings plan administered under section 352.98.
101.5 	(d) "Governing board" means the Board of Trustees of the Public Employees 
101.6 	Retirement Association, the Board of Trustees of the Teachers Retirement Association, or 
101.7 	the Board of Directors of the Minnesota State Retirement System.
101.8 	(e) "Person" includes an active, retired, deferred, or nonvested inactive participant in 
101.9 	a covered pension plan  or a beneficiary of a participant, or an individual who has applied 
101.10 	to be a participant or who is or may be a survivor of a participant, or a state agency or 
101.11 	other governmental unit that employs active participants in a covered  pension plan.

101.12 	EFFECTIVE DATE. This section is effective August 1, 2008.

101.13 	Sec. 8. Minnesota Statutes 2006, section 356B.10, subdivision 3, is amended to read:
101.14 		Subd. 3.Contracting procedures. (a) The commissioner may enter into a contract 
101.15 	for facilities with a contractor to furnish the architectural, engineering, and related services 
101.16 	as well as the labor, materials, supplies, equipment, and related construction services on 
101.17 	the basis of a request for qualifications and competitive responses received through a 
101.18 	request for proposals process that must include the items listed in paragraphs (b) to (i).
101.19 	(b) Before issuing a request for qualifications and a request for proposals, the 
101.20 	commissioner, with the assistance of the boards, shall prepare performance criteria and 
101.21 	specifications that include:
101.22 	(1) a general floor plan or layout indicating the general dimensions of the public 
101.23 	building and space requirements;
101.24 	(2) design criteria for the exterior and site area;
101.25 	(3) performance specifications for all building systems and components to ensure 
101.26 	quality and cost efficiencies;
101.27 	(4) conceptual floor plans for systems space;
101.28 	(5) preferred types of interior finishes, styles of windows, lighting and outlets, doors, 
101.29 	and features such as built-in counters and telephone wiring;
101.30 	(6) mechanical and electrical requirements;
101.31 	(7) special interior features required; and
101.32 	(8) a completion schedule.
101.33 	(c) The commissioner shall first solicit statements of qualifications from eligible 
101.34 	contractors and select more than one qualified contractor based upon experience, technical 
101.35 	competence, past performance, capability to perform, and other appropriate facts. 
102.1 	Contractors selected under this process must be, employ, or have as a partner, member, 
102.2 	coventurer, or subcontractor, persons licensed and registered under chapter 326 to provide 
102.3 	the services required to design and complete the project. The commissioner does not 
102.4 	have to select any of the respondents if none reasonably fulfill the criteria set forth in 
102.5 	this paragraph.
102.6 	(d) The contractors selected shall be asked to respond to a request for proposals. 
102.7 	Responses must include site plans, design concept, elevation, statement of material to 
102.8 	be used, floor layouts, a detailed development budget, and a total cost to complete the 
102.9 	project. The proposal must indicate that the contractor obtained at least two proposals 
102.10 	from subcontractors for each item of work and must set forth how the subcontractors 
102.11 	were selected. The commissioner, with the assistance of the boards, shall evaluate the 
102.12 	proposals based upon design, cost, quality, aesthetics, and the best overall value to the 
102.13 	state pension funds. The commissioner need not select any of the proposals submitted 
102.14 	and reserves the right to reject any and all proposals, and may terminate the process or 
102.15 	revise the request for proposals and solicit new proposals if the commissioner determines 
102.16 	that the best interests of the pension funds would be better served by doing so. Proposals 
102.17 	submitted are nonpublic data until the contract is awarded.
102.18 	(e) The contractor selected must comply with sections 574.26 to 574.261. Before 
102.19 	executing a final contract, the contractor selected shall certify a firm construction price 
102.20 	and completion date. 
102.21 	(f) The commissioner may consider building sites in the city of St. Paul and 
102.22 	surrounding suburbs.
102.23 	(g) Any land, building, or facility leased, constructed, or acquired and any leasehold 
102.24 	interest acquired under this section must be held by the state in trust for the three retirement 
102.25 	systems as tenants in common. Each retirement system fund must consider its interest as a 
102.26 	fixed asset of its pension fund in accordance with governmental accounting standards.
102.27 	(h) The commissioner may lease to another governmental subdivision, to a private 
102.28 	company under contract with the State Board of Investment, or with the Board of Directors 
102.29 	of the Minnesota State Retirement System, whichever applies, to provide deferred 
102.30 	compensation services under section 352.96 352.965, any portion of the funds' building 
102.31 	and lands that is not required for their direct use upon terms and conditions they deem to 
102.32 	be in the best interest of the pension funds. Any income accruing from the rentals must 
102.33 	be separately accounted for and utilized to offset ongoing administrative expenses and 
102.34 	any excess must be carried forward for future administrative expenses. The commissioner 
102.35 	may also enter into lease agreements for the establishment of satellite offices should the 
102.36 	boards find them to be necessary in order to assure their members reasonable access to 
103.1 	their services. The commissioner may lease under section 16B.24 any portion of the 
103.2 	facilities not required for the direct use of the boards. 
103.3 	(i) The boards shall formulate and adopt a written working agreement that sets forth 
103.4 	the nature of each retirement system's ownership interest, the duties and obligations of 
103.5 	each system toward the construction, operation, and maintenance costs of its facilities, and 
103.6 	identifies one retirement fund to serve as manager for operating and maintenance purposes. 
103.7 	The boards may contract with independent third parties for maintenance-related activities, 
103.8 	services, and supplies, and may use the services of the Department of Administration 
103.9 	where economically feasible to do so. If the boards cannot agree or resolve a dispute 
103.10 	about operations or maintenance of the facilities, they may request the commissioner of 
103.11 	administration to appoint a representative from the department's real estate management 
103.12 	division to serve as arbitrator of the dispute with authority to issue a written resolution 
103.13 	of the dispute.

103.14 	EFFECTIVE DATE. This section is effective August 1, 2008.

103.15 	Sec. 9. Minnesota Statutes 2006, section 363A.36, subdivision 1, is amended to read:
103.16 		Subdivision 1.Scope of application. (a) For all contracts for goods and services in 
103.17 	excess of $100,000, no department or agency of the state shall accept any bid or proposal 
103.18 	for a contract or agreement from any business having more than 40 full-time employees 
103.19 	within this state on a single working day during the previous 12 months, unless the 
103.20 	commissioner is in receipt of the business' affirmative action plan for the employment of 
103.21 	minority persons, women, and qualified disabled individuals. No department or agency of 
103.22 	the state shall execute any such contract or agreement until the affirmative action plan 
103.23 	has been approved by the commissioner. Receipt of a certificate of compliance issued by 
103.24 	the commissioner shall signify that a firm or business has an affirmative action plan that 
103.25 	has been approved by the commissioner. A certificate shall be valid for a period of two 
103.26 	years. A municipality as defined in section 466.01, subdivision 1, that receives state 
103.27 	money for any reason is encouraged to prepare and implement an affirmative action plan 
103.28 	for the employment of minority persons, women, and the qualified disabled and submit the 
103.29 	plan to the commissioner. 
103.30 	(b) This paragraph applies to a contract for goods or services in excess of $100,000 
103.31 	to be entered into between a department or agency of the state and a business that is 
103.32 	not subject to paragraph (a), but that has more than 40 full-time employees on a single 
103.33 	working day during the previous 12 months in the state where the business has its primary 
103.34 	place of business. A department or agency of the state may not execute a contract or 
103.35 	agreement with a business covered by this paragraph unless the business has a certificate 
104.1 	of compliance issued by the commissioner under paragraph (a) or the business certifies 
104.2 	that it is in compliance with federal affirmative action requirements.
104.3 	(c) This section does not apply to contracts entered into by the State Board of 
104.4 	Investment for investment options under section 352.96 352.965, subdivision 4. 

104.5 	EFFECTIVE DATE. This section is effective August 1, 2008.

104.6 	Sec. 10. Minnesota Statutes 2006, section 383B.914, subdivision 7, is amended to read:
104.7 		Subd. 7.Participation in state deferred compensation plan. (a) Existing 
104.8 	employees of the corporation, at the election of the corporation, if otherwise qualified, 
104.9 	are eligible to participate in the Hennepin County supplemental retirement plan under 
104.10 	sections 383B.46 and 383B.52.
104.11 	(b) Existing and future employees of the corporation, at the election of the 
104.12 	corporation, are eligible to participate in the Minnesota state deferred compensation 
104.13 	plan under section 352.96 352.965, the postretirement health care savings plan under 
104.14 	section 352.98, and all other deferred compensation arrangements for which all persons 
104.15 	employed by the county whose employment is accounted for in the county enterprise fund 
104.16 	for HCMC were eligible.

104.17 	EFFECTIVE DATE. This section is effective August 1, 2008.

104.18 	Sec. 11. Minnesota Statutes 2006, section 518.003, subdivision 8, is amended to read:
104.19 		Subd. 8.Public pension plan. "Public pension plan" means a pension plan or 
104.20 	fund specified in section 356.20, subdivision 2, or 356.30, subdivision 3, the deferred 
104.21 	compensation plan specified in section 352.96 352.965, or any retirement or pension plan 
104.22 	or fund, including a supplemental retirement plan or fund, established, maintained, or 
104.23 	supported by a governmental subdivision or public body whose revenues are derived from 
104.24 	taxation, fees, assessments, or from other public sources. 

104.25 	EFFECTIVE DATE. This section is effective August 1, 2008.

104.26 	Sec. 12.  REPEALER.
 104.27 	Minnesota Statutes 2006, section 352.96; and Minnesota Rules, parts 7905.0100; 
104.28 	7905.0200; 7905.0300; 7905.0400; 7905.0500; 7905.0600; 7905.0700; 7905.0800; 
104.29 	7905.0900; 7905.1000; 7905.1100; 7905.1200; 7905.1300; 7905.1400; 7905.1500; 
104.30 	7905.1600; 7905.1700; 7905.1800; 7905.1900; 7905.2000; 7905.2100; 7905.2200; 
104.31 	7905.2300; 7905.2400; 7905.2450; 7905.2500; 7905.2560; 7905.2600; 7905.2700; 
104.32 	7905.2800; and 7905.2900, are repealed.

105.1 	EFFECTIVE DATE. This section is effective August 1, 2008.

105.2 	ARTICLE 13
105.3 	PERA POLICE AND FIRE PLAN
105.4 	DUTY DISABILITY BENEFIT INCREASE

105.5 	Section 1. Minnesota Statutes 2007 Supplement, section 353.656, subdivision 1, 
105.6 	is amended to read:
105.7 		Subdivision 1.Duty disability; computation of benefits. (a) A member of 
105.8 	the police and fire plan who is determined to qualify for duty disability as defined in 
105.9 	section 353.01, subdivision 41, shall receive disability benefits during the period of such 
105.10 	disability in an amount equal to 60 percent of the average salary as defined in section 
105.11 	353.01, subdivision 17a, plus an additional percentage specified under section 356.315, 
105.12 	subdivision 6, of that average salary for each year of service in excess of 20 years. 
105.13 	(b) To be eligible for a benefit under paragraph (a), the member must have:
105.14 	(1) not met the requirements for a retirement annuity under section 353.651, 
105.15 	subdivision 1; or
105.16 	(2) met the requirements under that subdivision, but does not have at least 20 years 
105.17 	of allowable service credit.
105.18 	(c) If paragraph (b), clause (2), applies, the disability benefit must be paid for a 
105.19 	period of 60 months from the disability benefit accrual date and at the end of that period 
105.20 	is subject to provisions of subdivision 5a.
105.21 	(d) If the disability under this subdivision occurs before the member has at least five 
105.22 	years of allowable service credit in the police and fire plan, the disability benefit must be 
105.23 	computed on the average salary from which deductions were made for contribution to 
105.24 	the police and fire fund.

105.25 	EFFECTIVE DATE. This section is effective retroactively from July 1, 2007.

105.26 	ARTICLE 14
105.27 	LOCAL POLICE AND PAID FIRE
105.28 	RELIEF ASSOCIATION CHANGES

105.29 	Section 1. [423A.021] DEFINED POSTRETIREMENT BENEFITS.
105.30 		Subdivision 1.Pension unit increase. For a salaried firefighters relief association in 
105.31 	a city of the first class with a population greater than 300,000, when the actuarial value 
105.32 	of assets of the special fund first exceeds 110 percent of the actuarial accrued liabilities, 
105.33 	according to an annual actuarial valuation occurring after the effective date of this section 
106.1 	and performed in accordance with sections 356.215 and 356.216, each service pensioner, 
106.2 	joint survivor annuitant, and surviving spouse member is entitled to a permanent benefit 
106.3 	increase. The revised benefit is an increase of one unit for a service pensioner, not to 
106.4 	exceed 43 units, an increase from 22 to 23 units for a surviving spouse benefit, and an 
106.5 	increase from 42.3 to 43.2 units for unmarried service pensioners. The association shall 
106.6 	pay the increased benefit beginning January 1 of the year following the year for which the 
106.7 	valuation was prepared. If adding an additional unit results in raising total units past the 
106.8 	maximum, a partial unit may be added to reach the maximum. For joint survivor annuities, 
106.9 	this subdivision authorizes a benefit increase actuarially equivalent to one unit.
106.10 		Subd. 2.Unit precedence. The additional benefit provided for in subdivision 
106.11 	1 shall take precedence over any other benefit provided when the fund reaches 110 
106.12 	percent funding. In preparing the actuarial valuation under sections 356.215 and 356.216, 
106.13 	the actuary for the fund shall first account for the benefit provided in subdivision 1 in 
106.14 	determining the plan's funded ratio. No other benefit payments may be made by the 
106.15 	association until the actuarial impact of the benefit provided for in subdivision 1 has been 
106.16 	determined and factored into the funding ratio.
106.17 		Subd. 3.Excess investment income. For a salaried firefighters relief association in 
106.18 	a city of the first class with a population greater than 300,000 that no longer is entitled to 
106.19 	state general fund aid pursuant to section 423A.02, the association shall apply any assets 
106.20 	that constitute excess investment income to the payment of a supplemental postretirement 
106.21 	benefit to an eligible member notwithstanding any other limitation of law. Any amount 
106.22 	of excess investment income not otherwise used for the payment of a supplemental 
106.23 	postretirement benefit to an eligible member shall be applied to reduce the municipality's 
106.24 	property tax levy to the association in the year following the payment of the postretirement 
106.25 	benefit. A supplemental postretirement benefit is a lump sum payment equal to the 
106.26 	monthly benefit provided to the benefit recipient in the month prior to payment of the 
106.27 	supplemental postretirement benefit. A supplemental postretirement benefit payable under 
106.28 	this section is in lieu of any benefit payable under section 423C.06, subdivision 2. No 
106.29 	supplemental postretirement benefit is payable under this section if a benefit is payable 
106.30 	under section 423C.06, subdivision 3.

106.31 	ARTICLE 15
106.32 	VOLUNTEER FIREFIGHTER RELIEF ASSOCIATION CHANGES

106.33 	Section 1. Minnesota Statutes 2006, section 6.67, is amended to read:
106.34 	6.67 PUBLIC ACCOUNTANTS; REPORT OF EVIDENCE POINTING TO 
106.35 	MISCONDUCT.
107.1 	Whenever a public accountant in the course of auditing the books and affairs of a 
107.2 	county, city, town, school district, or other public corporations, shall discovercorporation, 
107.3 	or local public pension plan governed by section 69.77, sections 69.771 to 69.775, or 
107.4 	chapter 354A, 422A, 423B, 423C, or 424A, discovers evidence pointing to nonfeasance, 
107.5 	misfeasance, or malfeasance, on the part of an officer or employee in the conduct of duties 
107.6 	and affairs, the public accountant shall promptly make a report of such discovery to the 
107.7 	state auditor and the county attorney of the county in which the governmental unit is 
107.8 	situated and the public accountant shall also furnish a copy of the report of audit upon 
107.9 	completion to said officers. The county attorney shall act on such report in the same 
107.10 	manner as required by law for reports made to the county attorney by the state auditor.

107.11 	EFFECTIVE DATE. This section is effective the day following final enactment.

107.12 	Sec. 2. Minnesota Statutes 2006, section 69.011, subdivision 1, is amended to read:
107.13 		Subdivision 1.Definitions. Unless the language or context clearly indicates that a 
107.14 	different meaning is intended, the following words and terms shall for the purposes of this 
107.15 	chapter and chapters 423, 423A, 424 and 424A have the meanings ascribed to them:
107.16 	(a) "Commissioner" means the commissioner of revenue.
107.17 	(b) "Municipality" means:
107.18 	(1) a home rule charter or statutory city;
107.19 	(2) an organized town;
107.20 	(3) a park district subject to chapter 398;
107.21 	(4) the University of Minnesota;
107.22 	(5) for purposes of the fire state aid program only, an American Indian tribal 
107.23 	government entity located within a federally recognized American Indian reservation;
107.24 	(6) for purposes of the police state aid program only, an American Indian tribal 
107.25 	government with a tribal police department which exercises state arrest powers under 
107.26 	section 626.90, 626.91, 626.92, or 626.93; 
107.27 	(7) for purposes of the police state aid program only, the Metropolitan Airports 
107.28 	Commission with respect to peace officers covered under chapter 422A; and
107.29 	(8) for purposes of the police state aid program only, the Department of Natural 
107.30 	Resources and the Department of Public Safety with respect to peace officers covered 
107.31 	under chapter 352B.
107.32 	(c) "Minnesota Firetown Premium Report" means a form prescribed by the 
107.33 	commissioner containing space for reporting by insurers of fire, lightning, sprinkler 
107.34 	leakage and extended coverage premiums received upon risks located or to be performed 
107.35 	in this state less return premiums and dividends.
108.1 	(d) "Firetown" means the area serviced by any municipality having a qualified fire 
108.2 	department or a qualified incorporated fire department having a subsidiary volunteer 
108.3 	firefighters' relief association.
108.4 	(e) "Market value" means latest available market value of all property in a taxing 
108.5 	jurisdiction, whether the property is subject to taxation, or exempt from ad valorem 
108.6 	taxation obtained from information which appears on abstracts filed with the commissioner 
108.7 	of revenue or equalized by the State Board of Equalization.
108.8 	(f) "Minnesota Aid to Police Premium Report" means a form prescribed by the 
108.9 	commissioner for reporting by each fire and casualty insurer of all premiums received 
108.10 	upon direct business received by it in this state, or by its agents for it, in cash or otherwise, 
108.11 	during the preceding calendar year, with reference to insurance written for insuring against 
108.12 	the perils contained in auto insurance coverages as reported in the Minnesota business 
108.13 	schedule of the annual financial statement which each insurer is required to file with 
108.14 	the commissioner in accordance with the governing laws or rules less return premiums 
108.15 	and dividends.
108.16 	(g) "Peace officer" means any person:
108.17 	(1) whose primary source of income derived from wages is from direct employment 
108.18 	by a municipality or county as a law enforcement officer on a full-time basis of not less 
108.19 	than 30 hours per week;
108.20 	(2) who has been employed for a minimum of six months prior to December 31 
108.21 	preceding the date of the current year's certification under subdivision 2, clause (b);
108.22 	(3) who is sworn to enforce the general criminal laws of the state and local 
108.23 	ordinances;
108.24 	(4) who is licensed by the Peace Officers Standards and Training Board and is 
108.25 	authorized to arrest with a warrant; and
108.26 	(5) who is a member of a local police relief association to which section 69.77
108.27 	applies, the State Patrol retirement plan, the public employees police and fire fund, or the 
108.28 	Minneapolis Employees Retirement Fund. 
108.29 	(h) "Full-time equivalent number of peace officers providing contract service" means 
108.30 	the integral or fractional number of peace officers which would be necessary to provide 
108.31 	the contract service if all peace officers providing service were employed on a full-time 
108.32 	basis as defined by the employing unit and the municipality receiving the contract service.
108.33 	(i) "Retirement benefits other than a service pension" means any disbursement 
108.34 	authorized under section 424A.05, subdivision 3, clauses (2),and (3), and (4). 
108.35 	(j) "Municipal clerk, municipal clerk-treasurer, or county auditor" means the person 
108.36 	who was elected or appointed to the specified position or, in the absence of the person, 
109.1 	another person who is designated by the applicable governing body. In a park district, 
109.2 	the clerk is the secretary of the board of park district commissioners. In the case of the 
109.3 	University of Minnesota, the clerk is that official designated by the Board of Regents. 
109.4 	For the Metropolitan Airports Commission, the clerk is the person designated by the 
109.5 	commission. For the Department of Natural Resources or the Department of Public Safety, 
109.6 	the clerk is the respective commissioner. For a tribal police department which exercises 
109.7 	state arrest powers under section 626.90, 626.91, 626.92, or 626.93, the clerk is the person 
109.8 	designated by the applicable American Indian tribal government. 

109.9 	EFFECTIVE DATE. This section is effective January 1, 2009.

109.10 	Sec. 3. Minnesota Statutes 2006, section 356A.06, subdivision 1, is amended to read:
109.11 		Subdivision 1.Authorized holder of assets; title to assets. (a) Assets of a covered 
109.12 	pension plan may be held only by:
109.13 	(1) the plan treasurer,;
109.14 	(2) the State Board of Investment,;
109.15 	(3) the depository agent of the plan,; 
109.16 	(4) a security broker or the broker's agent with, in either case, insurance equal to or 
109.17 	greater than the plan assets held from the Securities Investor Protection Corporation or 
109.18 	from excess insurance coverage; or
109.19 	(5) the depository agent of the State Board of Investment. 
109.20 	(b) Legal title to plan assets must be vested in the plan, the State Board of 
109.21 	Investment, the governmental entity that sponsors the plan, the nominee of the plan, or 
109.22 	the depository agent. The holder of legal title shall function as a trustee for a person or 
109.23 	entity with a beneficial interest in the assets of the plan.

109.24 	EFFECTIVE DATE. This section is effective the day following final enactment.

109.25 	Sec. 4. Minnesota Statutes 2006, section 356A.06, subdivision 7, is amended to read:
109.26 		Subd. 7.Expanded list of authorized investment securities. (a) Authority. 
109.27 	 Except to the extent otherwise authorized by law, a covered pension plan not described by 
109.28 	subdivision 6, paragraph (a), shall invest its assets only in accordance with this subdivision.
109.29 	(b) Securities generally. The covered pension plan has the authority to purchase, 
109.30 	sell, lend, or exchange the securities specified in paragraphs (c) to (i), including puts and 
109.31 	call options and future contracts traded on a contract market regulated by a governmental 
109.32 	agency or by a financial institution regulated by a governmental agency. These securities 
109.33 	may be owned as units in commingled trusts that own the securities described in 
110.1 	paragraphs (c) to (i), including real estate investment trusts and insurance company 
110.2 	commingled accounts, including separate accounts.
110.3 	(c) Government obligations. The covered pension plan may invest funds in 
110.4 	governmental bonds, notes, bills, mortgages, and other evidences of indebtedness if the 
110.5 	issue is backed by the full faith and credit of the issuer or the issue is rated among the top 
110.6 	four quality rating categories by a nationally recognized rating agency. The obligations in 
110.7 	which funds may be invested under this paragraph include guaranteed or insured issues 
110.8 	of (1) the United States, its agencies, its instrumentalities, or organizations created and 
110.9 	regulated by an act of Congress; (2) Canada and its provinces, provided the principal and 
110.10 	interest is payable in United States dollars; (3) the states and their municipalities, political 
110.11 	subdivisions, agencies, or instrumentalities; (4) the International Bank for Reconstruction 
110.12 	and Development, the Inter-American Development Bank, the Asian Development Bank, 
110.13 	the African Development Bank, or any other United States government sponsored 
110.14 	organization of which the United States is a member, provided the principal and interest is 
110.15 	payable in United States dollars.
110.16 	(d) Corporate obligations. The covered pension plan may invest funds in bonds, 
110.17 	notes, debentures, transportation equipment obligations, or any other longer term 
110.18 	evidences of indebtedness issued or guaranteed by a corporation organized under the laws 
110.19 	of the United States or any state thereof, or the Dominion of Canada or any province 
110.20 	thereof if they conform to the following provisions:
110.21 	(1) the principal and interest of obligations of corporations incorporated or organized 
110.22 	under the laws of the Dominion of Canada or any province thereof must be payable in 
110.23 	United States dollars; and
110.24 	(2) obligations must be rated among the top four quality categories by a nationally 
110.25 	recognized rating agency.
110.26 	(e) Other obligations. (1) The covered pension plan may invest funds in 
110.27 	bankers acceptances, certificates of deposit, deposit notes, commercial paper, mortgage 
110.28 	participation certificates and pools, asset backed securities, repurchase agreements and 
110.29 	reverse repurchase agreements, guaranteed investment contracts, savings accounts, and 
110.30 	guaranty fund certificates, surplus notes, or debentures of domestic mutual insurance 
110.31 	companies if they conform to the following provisions:
110.32 	(i) bankers acceptances and deposit notes of United States banks are limited to those 
110.33 	issued by banks rated in the highest four quality categories by a nationally recognized 
110.34 	rating agency;
110.35 	(ii) certificates of deposit are limited to those issued by (A) United States banks and 
110.36 	savings institutions that are rated in the highest four quality categories by a nationally 
111.1 	recognized rating agency or whose certificates of deposit are fully insured by federal 
111.2 	agencies; or (B) credit unions in amounts up to the limit of insurance coverage provided 
111.3 	by the National Credit Union Administration;
111.4 	(iii) commercial paper is limited to those issued by United States corporations or 
111.5 	their Canadian subsidiaries and rated in the highest two quality categories by a nationally 
111.6 	recognized rating agency;
111.7 	(iv) mortgage participation or pass through certificates evidencing interests in pools 
111.8 	of first mortgages or trust deeds on improved real estate located in the United States where 
111.9 	the loan to value ratio for each loan as calculated in accordance with section 61A.28, 
111.10 	subdivision 3, does not exceed 80 percent for fully amortizable residential properties and 
111.11 	in all other respects meets the requirements of section 61A.28, subdivision 3;
111.12 	(v) collateral for repurchase agreements and reverse repurchase agreements is 
111.13 	limited to letters of credit and securities authorized in this section;
111.14 	(vi) guaranteed investment contracts are limited to those issued by insurance 
111.15 	companies or banks rated in the top four quality categories by a nationally recognized 
111.16 	rating agency or to alternative guaranteed investment contracts where the underlying 
111.17 	assets comply with the requirements of this subdivision;
111.18 	(vii) savings accounts are limited to those fully insured by federal agencies; and
111.19 	(viii) asset backed securities must be rated in the top four quality categories by a 
111.20 	nationally recognized rating agency.
111.21 	(2) Sections 16A.58, 16C.03, subdivision 4, and 16C.05 do not apply to certificates 
111.22 	of deposit and collateralization agreements executed by the covered pension plan under 
111.23 	clause (1), item (ii).
111.24 	(3) In addition to investments authorized by clause (1), item (iv), the covered 
111.25 	pension plan may purchase from the Minnesota Housing Finance Agency all or any part of 
111.26 	a pool of residential mortgages, not in default, that has previously been financed by the 
111.27 	issuance of bonds or notes of the agency. The covered pension plan may also enter into 
111.28 	a commitment with the agency, at the time of any issue of bonds or notes, to purchase 
111.29 	at a specified future date, not exceeding 12 years from the date of the issue, the amount 
111.30 	of mortgage loans then outstanding and not in default that have been made or purchased 
111.31 	from the proceeds of the bonds or notes. The covered pension plan may charge reasonable 
111.32 	fees for any such commitment and may agree to purchase the mortgage loans at a price 
111.33 	sufficient to produce a yield to the covered pension plan comparable, in its judgment, 
111.34 	to the yield available on similar mortgage loans at the date of the bonds or notes. The 
111.35 	covered pension plan may also enter into agreements with the agency for the investment 
112.1 	of any portion of the funds of the agency. The agreement must cover the period of the 
112.2 	investment, withdrawal privileges, and any guaranteed rate of return.
112.3 	(f) Corporate stocks. The covered pension plan may invest funds in stocks or 
112.4 	convertible issues of any corporation organized under the laws of the United States or the 
112.5 	states thereof, any corporation organized under the laws of the Dominion of Canada or its 
112.6 	provinces, or any corporation listed on an exchange regulated by an agency of the United 
112.7 	States or of the Canadian national government, if they conform to the following provisions:
112.8 	(1) the aggregate value of investments under this paragraph, plus paragraphs (g) and 
112.9 	(k), plus equity investments under paragraphs (h), (i), and (j), as adjusted for realized 
112.10 	gains and losses, must not exceed 85 percent of the market or book value, whichever is 
112.11 	less, of a fund; and
112.12 	(2) investments must not exceed five percent of the total outstanding shares of 
112.13 	any one corporation.
112.14 	(g) Developed market foreign stocks investments. In addition to investments 
112.15 	authorized under paragraph (f), the covered pension fund may invest in foreign stock sold 
112.16 	on an exchange in any developed market country that is included in the Europe, Australia, 
112.17 	and Far East Index.
112.18 	(h) Commingled or mutual investments. The covered pension plan may invest 
112.19 	in index funds or mutual funds, including index mutual funds, through bank-sponsored 
112.20 	collective funds and shares of open-end investment companies registered under the 
112.21 	Federal Investment Company Act of 1940, if the investments of the index or of the mutual 
112.22 	fundto the extent that these funds comply with paragraphs (c) to (j).
112.23 	(i) Real estate investment trust; related investments. The covered pension plan 
112.24 	may invest in real estate investment trusts secured by mortgages or deeds of trust and 
112.25 	sold on an exchange, and insurance company commingled accounts, including separate 
112.26 	accounts, of a debt or equity nature.
112.27 	(j) Exchange traded funds. The covered pension plan may invest funds in exchange 
112.28 	traded funds, subject to the maximums, the requirements, and the limitations set forth in 
112.29 	paragraphs (c) to (i), as applicable.
112.30 	(k) Other investments. (1) In addition to the investments authorized in paragraphs 
112.31 	(b) to (j), and subject to the provisions in clause (2), the covered pension plan may invest 
112.32 	funds in:
112.33 	(i) venture capital investment businesses through participation in limited partnerships 
112.34 	and corporations;
112.35 	(ii) real estate ownership interests or loans secured by mortgages or deeds of trust 
112.36 	through investment in limited partnerships or bank sponsored collective funds;
113.1 	(iii) regional and mutual funds through bank sponsored collective funds and 
113.2 	open-end investment companies registered under the Federal Investment Company Act 
113.3 	of 1940 which doto the extent that a fund or a portion of a fund does not qualify under 
113.4 	paragraph (h);
113.5 	(iv) resource investments through limited partnerships, private placements, and 
113.6 	corporations; and
113.7 	(v) international debt securities and emerging market equity securities.
113.8 	(2) The investments authorized in clause (1) must conform to the following 
113.9 	provisions:
113.10 	(i) the aggregate value of all investments made according to clause (1), including 
113.11 	allocated amounts of index and mutual funds, may not exceed 20 percent of the market 
113.12 	value of the fund for which the covered pension plan is investing;
113.13 	(ii) there must be at least four unrelated owners of the investment other than the 
113.14 	covered pension plan for investments made under clause (1), item (i), (ii), (iii), or (iv);
113.15 	(iii) covered pension plan participation in an investment vehicle is limited to 20 
113.16 	percent thereof for investments made under clause (1), item (i), (ii), (iii), or (iv); and
113.17 	(iv) covered pension plan participation in a limited partnership does not include a 
113.18 	general partnership interest or other interest involving general liability. The covered 
113.19 	pension plan may not engage in any activity as a limited partner which creates general 
113.20 	liability.

113.21 	EFFECTIVE DATE. This section is effective the day following final enactment.

113.22 	Sec. 5. Minnesota Statutes 2006, section 356A.06, subdivision 8b, is amended to read:
113.23 		Subd. 8b.Disclosure of investment authority; receipt of statement. (a) For 
113.24 	this subdivision, the term "broker" means a broker, broker-dealer, investment advisor, 
113.25 	investment manager, or third party agent who transfers, purchases, sells, or obtains 
113.26 	investment securities for, or on behalf of, a covered pension plan.
113.27 	(b) Before a covered pension plan may complete an investment transaction with or 
113.28 	in accord with the advice of a broker, the covered pension plan shall provide annually to 
113.29 	the broker a written statement of investment restrictions applicable under state law to the 
113.30 	covered pension plan or applicable under the pension plan governing board investment 
113.31 	policy.
113.32 	(c) A broker must acknowledge in writing annually the receipt of the statement of 
113.33 	investment restrictions and must agree to handle the covered pension plan's investments 
113.34 	and assets in accord with the provided investment restrictions. A covered pension plan 
113.35 	may not enter into or continue a business arrangement with a broker until the broker has 
114.1 	provided this written acknowledgment to the chief administrative officer of the covered 
114.2 	pension plan.
114.3 	(d) If any portion of the plan's assets are held by a security broker or its agent, the 
114.4 	security broker or its agent must acknowledge in writing annually that sufficient insurance 
114.5 	has been obtained from the Securities Investor Protection Corporation, supplemented by 
114.6 	additional insurance, if necessary, to cover the full amount of covered pension plan assets 
114.7 	held by the security broker or its agent. Uniform acknowledgment forms prepared by the 
114.8 	state auditor shall be used by covered pension plans and brokers to meet the requirements 
114.9 	of this subdivision.

114.10 	EFFECTIVE DATE. This section is effective the day following final enactment.

114.11 	Sec. 6. Minnesota Statutes 2006, section 424A.001, is amended by adding a 
114.12 	subdivision to read:
114.13 		Subd. 1a.Ancillary benefit. "Ancillary benefit" means a benefit other than a service 
114.14 	pension that is permitted by law and that is provided for in the relief association bylaws.

114.15 	EFFECTIVE DATE. This section is effective January 1, 2009.

114.16 	Sec. 7. Minnesota Statutes 2006, section 424A.001, subdivision 6, is amended to read:
114.17 		Subd. 6.Surviving spouse. For purposes of this chapter, and the governing bylaws 
114.18 	of any relief association to which this chapter applies, the term "surviving spouse" means 
114.19 	any person who was the dependent spouse of a deceased active member or retired former 
114.20 	member living with the member at the time of the death of the active member or retired 
114.21 	former member for at least one year prior to the date on which the member terminated 
114.22 	active service and membership the spouse of a deceased member who was legally married 
114.23 	to the member at the time of death.

114.24 	EFFECTIVE DATE. This section is effective January 1, 2009.

114.25 	Sec. 8. Minnesota Statutes 2006, section 424A.02, subdivision 3, is amended to read:
114.26 		Subd. 3.Flexible service pension maximums. (a) Annually on or before August 
114.27 	1 as part of the certification of the financial requirements and minimum municipal 
114.28 	obligation determined under section 69.772, subdivision 4, or 69.773, subdivision 5, as 
114.29 	applicable, the secretary or some other official of the relief association designated in 
114.30 	the bylaws of each relief association shall calculate and certify to the governing body 
114.31 	of the applicable qualified municipality the average amount of available financing per 
114.32 	active covered firefighter for the most recent three-year period. The amount of available 
115.1 	financing shall include any amounts of fire state aid received or receivable by the relief 
115.2 	association, any amounts of municipal contributions to the relief association raised from 
115.3 	levies on real estate or from other available revenue sources exclusive of fire state aid, 
115.4 	and one-tenth of the amount of assets in excess of the accrued liabilities of the relief 
115.5 	association calculated under section 69.772, subdivision 2; 69.773, subdivisions 2 and 4; 
115.6 	or 69.774, subdivision 2, if any.
115.7 	(b) The maximum service pension which the relief association has authority to 
115.8 	provide for in its bylaws for payment to a member retiring after the calculation date when 
115.9 	the minimum age and service requirements specified in subdivision 1 are met must be 
115.10 	determined using the table in paragraph (c) or (d), whichever applies.
115.11 	(c) For a relief association where the governing bylaws provide for a monthly 
115.12 	service pension to a retiring member, the maximum monthly service pension amount 
115.13 	per month for each year of service credited that may be provided for in the bylaws is 
115.14 	the greater of the service pension amount provided for in the bylaws on the date of the 
115.15 	calculation of the average amount of the available financing per active covered firefighter 
115.16 	or the maximum service pension figure corresponding to the average amount of available 
115.17 	financing per active covered firefighter:

115.18
115.19
115.20	Minimum Average Amount of Available 
Financing per Firefighter
	Maximum Service Pension 
Amount Payable per Month for 
Each Year of Service
	
115.21	$ ...
		$ .25
		
115.22	41
		.50
		
115.23	81
		1.00
		
115.24	122
		1.50
		
115.25	162
		2.00
		
115.26	203
		2.50
		
115.27	243
		3.00
		
115.28	284
		3.50
		
115.29	324
		4.00
		
115.30	365
		4.50
		
115.31	405
		5.00
		
115.32	486
		6.00
		
115.33	567
		7.00
		
115.34	648
		8.00
		
115.35	729
		9.00
		
115.36	810
		10.00
		
115.37	891
		11.00
		
115.38	972
		12.00
		
115.39	1053
		13.00
		
115.40	1134
		14.00
		
116.1	1215
		15.00
		
116.2	1296
		16.00
		
116.3	1377
		17.00
		
116.4	1458
		18.00
		
116.5	1539
		19.00
		
116.6	1620
		20.00
		
116.7	1701
		21.00
		
116.8	1782
		22.00
		
116.9	1823
		22.50
		
116.10	1863
		23.00
		
116.11	1944
		24.00
		
116.12	2025
		25.00
		
116.13	2106
		26.00
		
116.14	2187
		27.00
		
116.15	2268
		28.00
		
116.16	2349
		29.00
		
116.17	2430
		30.00
		
116.18	2511
		31.00
		
116.19	2592
		32.00
		
116.20	2673
		33.00
		
116.21	2754
		34.00
		
116.22	2834
		35.00
		
116.23	2916
		36.00
		
116.24	2997
		37.00
		
116.25	3078
		38.00
		
116.26	3159
		39.00
		
116.27	3240
		40.00
		
116.28	3321
		41.00
		
116.29	3402
		42.00
		
116.30	3483
		43.00
		
116.31	3564
		44.00
		
116.32	3645
		45.00
		
116.33	3726
		46.00
		
116.34	3807
		47.00
		
116.35	3888
		48.00
		
116.36	3969
		49.00
		
116.37	4050
		50.00
		
116.38	4131
		51.00
		
116.39	4212
		52.00
		
116.40	4293
		53.00
		
116.41	4374
		54.00
		
116.42	4455
		55.00
		
116.43	4536
		56.00
		
117.1	Effective beginning December 31, 2008
		
117.2	4617
		57.00
		
117.3	4698
		58.00
		
117.4	4779
		59.00
		
117.5	4860
		60.00
		
117.6	4941
		61.00
		
117.7	5022
		62.00
		
117.8	5103
		63.00
		
117.9	5184
		64.00
		
117.10	5265
		65.00
		
117.11	Effective beginning December 31, 2009
		
117.12	5346
		66.00
		
117.13	5427
		67.00
		
117.14	5508
		68.00
		
117.15	5589
		69.00
		
117.16	5670
		70.00
		
117.17	5751
		71.00
		
117.18	5832
		72.00
		
117.19	5913
		73.00
		
117.20	5994
		74.00
		
117.21	Effective beginning December 31, 2010
		
117.22	6075
		75.00
		
117.23	6156
		76.00
		
117.24	6237
		77.00
		
117.25	6318
		78.00
		
117.26	6399
		79.00
		
117.27	6480
		80.00
		
117.28	6561
		81.00
		
117.29	6642
		82.00
		
117.30	6723
		83.00
		
117.31	Effective beginning December 31, 2011
		
117.32	6804
		84.00
		
117.33	6885
		85.00
		
117.34	6966
		86.00
		
117.35	7047
		87.00
		
117.36	7128
		88.00
		
117.37	7209
		89.00
		
117.38	7290
		90.00
		
117.39	7371
		91.00
		
117.40	7452
		92.00
		
117.41	Effective beginning December 31, 2012
		
117.42	7533
		93.00
		
117.43	7614
		94.00
		
118.1	7695
		95.00
		
118.2	7776
		96.00
		
118.3	7857
		97.00
		
118.4	7938
		98.00
		
118.5	8019
		99.00
		
118.6	8100
		100.00
		
118.7
118.8	any amount in excess 
of 8100
		100.00
		
118.9 	(d) For a relief association in which the governing bylaws provide for a lump sum 
118.10 	service pension to a retiring member, the maximum lump sum service pension amount for 
118.11 	each year of service credited that may be provided for in the bylaws is the greater of the 
118.12 	service pension amount provided for in the bylaws on the date of the calculation of the 
118.13 	average amount of the available financing per active covered firefighter or the maximum 
118.14 	service pension figure corresponding to the average amount of available financing per 
118.15 	active covered firefighter for the applicable specified period:

118.16
118.17
118.18	Minimum Average Amount of Available 
Financing per Firefighter
	Maximum Lump Sum Service 
Pension Amount Payable for 
Each Year of Service
	
118.19	$ ...
		$ 10
		
118.20	11
		20
		
118.21	16
		30
		
118.22	23
		40
		
118.23	27
		50
		
118.24	32
		60
		
118.25	43
		80
		
118.26	54
		100
		
118.27	65
		120
		
118.28	77
		140
		
118.29	86
		160
		
118.30	97
		180
		
118.31	108
		200
		
118.32	131
		240
		
118.33	151
		280
		
118.34	173
		320
		
118.35	194
		360
		
118.36	216
		400
		
118.37	239
		440
		
118.38	259
		480
		
118.39	281
		520
		
118.40	302
		560
		
118.41	324
		600
		
118.42	347
		640
		
119.1	367
		680
		
119.2	389
		720
		
119.3	410
		760
		
119.4	432
		800
		
119.5	486
		900
		
119.6	540
		1000
		
119.7	594
		1100
		
119.8	648
		1200
		
119.9	702
		1300
		
119.10	756
		1400
		
119.11	810
		1500
		
119.12	864
		1600
		
119.13	918
		1700
		
119.14	972
		1800
		
119.15	1026
		1900
		
119.16	1080
		2000
		
119.17	1134
		2100
		
119.18	1188
		2200
		
119.19	1242
		2300
		
119.20	1296
		2400
		
119.21	1350
		2500
		
119.22	1404
		2600
		
119.23	1458
		2700
		
119.24	1512
		2800
		
119.25	1566
		2900
		
119.26	1620
		3000
		
119.27	1672
		3100
		
119.28	1726
		3200
		
119.29	1753
		3250
		
119.30	1780
		3300
		
119.31	1820
		3375
		
119.32	1834
		3400
		
119.33	1888
		3500
		
119.34	1942
		3600
		
119.35	1996
		3700
		
119.36	2023
		3750
		
119.37	2050
		3800
		
119.38	2104
		3900
		
119.39	2158
		4000
		
119.40	2212
		4100
		
119.41	2265
		4200
		
119.42	2319
		4300
		
119.43	2373
		4400
		
120.1	2427
		4500
		
120.2	2481
		4600
		
120.3	2535
		4700
		
120.4	2589
		4800
		
120.5	2643
		4900
		
120.6	2697
		5000
		
120.7	2751
		5100
		
120.8	2805
		5200
		
120.9	2859
		5300
		
120.10	2913
		5400
		
120.11	2967
		5500
		
120.12	3021
		5600
		
120.13	3075
		5700
		
120.14	3129
		5800
		
120.15	3183
		5900
		
120.16	3237
		6000
		
120.17	3291
		6100
		
120.18	3345
		6200
		
120.19	3399
		6300
		
120.20	3453
		6400
		
120.21	3507
		6500
		
120.22	3561
		6600
		
120.23	3615
		6700
		
120.24	3669
		6800
		
120.25	3723
		6900
		
120.26	3777
		7000
		
120.27	3831
		7100
		
120.28	3885
		7200
		
120.29	3939
		7300
		
120.30	3993
		7400
		
120.31	4047
		7500
		
120.32	Effective beginning December 31, 2008
		
120.33	4101
		7600
		
120.34	4155
		7700
		
120.35	4209
		7800
		
120.36	4263
		7900
		
120.37	4317
		8000
		
120.38	4371
		8100
		
120.39	4425
		8200
		
120.40	4479
		8300
		
120.41	Effective beginning December 31, 2009
		
120.42	4533
		8400
		
120.43	4587
		8500
		
121.1	4641
		8600
		
121.2	4695
		8700
		
121.3	4749
		8800
		
121.4	4803
		8900
		
121.5	4857
		9000
		
121.6	4911
		9100
		
121.7	Effective beginning December 31, 2010
		
121.8	4965
		9200
		
121.9	5019
		9300
		
121.10	5073
		9400
		
121.11	5127
		9500
		
121.12	5181
		9600
		
121.13	5235
		9700
		
121.14	5289
		9800
		
121.15	5343
		9900
		
121.16	5397
		10,000
		
121.17
121.18	any amount in excess 
of 5397
		10,000
		
121.19 	(e) For a relief association in which the governing bylaws provide for a monthly 
121.20 	benefit service pension as an alternative form of service pension payment to a lump sum 
121.21 	service pension, the maximum service pension amount for each pension payment type 
121.22 	must be determined using the applicable table contained in this subdivision.
121.23 	(f) If a relief association establishes a service pension in compliance with the 
121.24 	applicable maximum contained in paragraph (c) or (d) and the minimum average amount 
121.25 	of available financing per active covered firefighter is subsequently reduced because of a 
121.26 	reduction in fire state aid or because of an increase in the number of active firefighters, the 
121.27 	relief association may continue to provide the prior service pension amount specified in 
121.28 	its bylaws, but may not increase the service pension amount until the minimum average 
121.29 	amount of available financing per firefighter under the table in paragraph (c) or (d), 
121.30 	whichever applies, permits.
121.31 	(g) No relief association is authorized to provide a service pension in an amount 
121.32 	greater than the largest applicable flexible service pension maximum amount even if 
121.33 	the amount of available financing per firefighter is greater than the financing amount 
121.34 	associated with the largest applicable flexible service pension maximum.

121.35 	Sec. 9. Minnesota Statutes 2006, section 424A.02, subdivision 7, is amended to read:
121.36 		Subd. 7.Deferred service pensions. (a) A member of a relief association is entitled 
121.37 	to a deferred service pension if the member:
122.1 	(1) has completed the lesser of the minimum period of active service with the fire 
122.2 	department specified in the bylaws or 20 years of active service with the fire department;
122.3 	(2) has completed at least five years of active membership in the relief association; 
122.4 	and
122.5 	(3) separates from active service and membership before reaching age 50 or the 
122.6 	minimum age for retirement and commencement of a service pension specified in the 
122.7 	bylaws governing the relief association if that age is greater than age 50.
122.8 	(b) The deferred service pension is payable when the former member reaches age 
122.9 	50, or the minimum age specified in the bylaws governing the relief association if that age 
122.10 	is greater than age 50, and when the former member makes a valid written application.
122.11 	(c) A relief association that provides a lump sum service pension governed by 
122.12 	subdivision 3 may, when its governing bylaws so provide, pay interest on the deferred 
122.13 	lump sum service pension during the period of deferral. If provided for in the bylaws, 
122.14 	interest must be paid in one of the following manners:
122.15 	(1) at the investment performance rate actually earned on that portion of the assets 
122.16 	if the deferred benefit amount is invested by the relief association in a separate account 
122.17 	established and maintained by the relief association or if the deferred benefit amount is 
122.18 	invested in a separate investment vehicle held by the relief association; or
122.19 	(2) at an interest rate of up to five percent, compounded annually, as set by the board 
122.20 	of directors and approved as provided in subdivision 10; or.
122.21 	(3) at a rate equal to the actual time weighted total rate of return investment 
122.22 	performance of the special fund as reported by the Office of the State Auditor under 
122.23 	section 356.219, up to five percent, compounded annually, and applied consistently for 
122.24 	all deferred service pensioners.
122.25 	A relief association may not use the method provided for in clause (3), until it has 
122.26 	modified its bylaws to be consistent with that clause.
122.27 	(d) Interest under paragraph (c), clause (2) or (3), is payable from the first day of 
122.28 	the month next following the date on which the municipality has approved the deferred 
122.29 	service pension interest rate established by the board of trustees or from the first day of the 
122.30 	month next following the date on which the member separated from active fire department 
122.31 	service and relief association membership, whichever is later, to the last day of the month 
122.32 	immediately before the month in which the deferred member becomes eligible to begin 
122.33 	receipt of the service pension and applies for the deferred service pension.
122.34 	(e) A relief association that provides a defined contribution service pension may, 
122.35 	if its governing bylaws so provide, credit interest or additional investment performance 
122.36 	on the deferred lump sum service pension during the period of deferral. If provided for 
123.1 	in the bylaws, the interest must be paid in one of the manners specified in paragraph 
123.2 	(c) or alternatively the relief association may credit any investment return on the assets 
123.3 	of the special fund of the defined contribution volunteer firefighter relief association in 
123.4 	proportion to the share of the assets of the special fund to the credit of each individual 
123.5 	deferred member account through the date on which the investment return is recognized 
123.6 	by and credited to the special fund.
123.7 	(f) For a deferred service pension that is transferred to a separate account established 
123.8 	and maintained by the relief association or separate investment vehicle held by the relief 
123.9 	association, the deferred member bears the full investment risk subsequent to transfer and 
123.10 	in calculating the accrued liability of the volunteer firefighters relief association that pays 
123.11 	a lump sum service pension, the accrued liability for deferred service pensions is equal 
123.12 	to the separate relief association account balance or the fair market value of the separate 
123.13 	investment vehicle held by the relief association.
123.14 	(g) The deferred service pension is governed by and must be calculated under 
123.15 	the general statute, special law, relief association articles of incorporation, and relief 
123.16 	association bylaw provisions applicable on the date on which the member separated from 
123.17 	active service with the fire department and active membership in the relief association.

123.18 	EFFECTIVE DATE. This section is effective the day following final enactment.

123.19 	Sec. 10. Minnesota Statutes 2006, section 424A.02, subdivision 9, is amended to read:
123.20 		Subd. 9.Limitation on ancillary benefits. Any relief association, including 
123.21 	any volunteer firefighters relief association governed by section   69.77 or any volunteer 
123.22 	firefighters division of a relief association governed by chapter 424, may only pay 
123.23 	ancillary benefits which would constitute an authorized disbursement as specified in 
123.24 	section   424A.05 subject to the following requirements or limitations: 
123.25 	(1) with respect to a relief association in which governing bylaws provide for a 
123.26 	lump sum service pension to a retiring member, no ancillary benefit may be paid to any 
123.27 	former member or paid to any person on behalf of any former member after the former 
123.28 	member (i) terminates active service with the fire department and active membership 
123.29 	in the relief association; and (ii) commences receipt of a service pension as authorized 
123.30 	under this section; and
123.31 	(2) with respect to any relief association, no ancillary benefit paid or payable to any 
123.32 	member, to any former member, or to any person on behalf of any member or former 
123.33 	member, may exceed in amount the total earned service pension of the member or former 
123.34 	member. The total earned service pension must be calculated usingby multiplying 
123.35 	the service pension amount specified in the bylaws of the relief association andat the 
124.1 	time of death or disability, whichever applies, by the years of service credited to the 
124.2 	member or former member. The years of service must be determined as of (i) the date 
124.3 	the member or former member became entitled to the ancillary benefit; or (ii) the date 
124.4 	the member or former member died entitling a survivor or the estate of the member or 
124.5 	former member to an ancillary benefit. The ancillary benefit must be calculated (i) without 
124.6 	regard to whether the member or former member had attained the minimum amount of 
124.7 	service and membership credit specified in the governing bylaws; and (ii) without regard 
124.8 	to the percentage amounts specified in subdivision 2;. For active members, the amount 
124.9 	of a permanent disability benefit or a survivor benefit must be equal to the member's 
124.10 	total earned service pension except that the bylaws of any relief association may provide 
124.11 	for the payment of a survivor benefit in an amount not to exceed five times the yearly 
124.12 	service pension amount specified in the bylaws on behalf of any member who dies before 
124.13 	having performed five years of active service in the fire department with which the relief 
124.14 	association is affiliated.

124.15 	EFFECTIVE DATE. This section is effective January 1, 2009.

124.16 	Sec. 11. Minnesota Statutes 2006, section 424A.05, subdivision 3, is amended to read:
124.17 		Subd. 3.Authorized disbursements from the special fund. (a) Disbursements 
124.18 	from the special fund are not permitted to be made for any purpose other than one of 
124.19 	the following:
124.20 	(1) for the payment of service pensions to retired members of the relief association if 
124.21 	authorized and paid under law and the bylaws governing the relief association;
124.22 	(2) for the payment of temporary or permanent disability benefits to disabled 
124.23 	members of the relief association if authorized and paid pursuant to law and specified in 
124.24 	amount in the bylaws governing the relief association;
124.25 	(3) for the payment of survivor benefits to surviving spouses and surviving children, 
124.26 	or if none, to designated beneficiaries, of deceased members of the relief association, 
124.27 	and if survivors and if no designated beneficiary, for the payment of a death benefit to 
124.28 	the estate of the deceased active firefighter, if authorized by and paid pursuant to law and 
124.29 	specified in amount in the bylaws governing the relief association;
124.30 	(4) for the payment of any funeral benefits to the surviving spouse, or if no surviving 
124.31 	spouse, the estate, of the deceased member of the relief association if authorized by law 
124.32 	and specified in amount in the bylaws governing the relief association;
124.33 	(5) for the payment of the fees, dues and assessments to the Minnesota State Fire 
124.34 	Department Association, to the Minnesota Area Relief Association Coalition, and to 
125.1 	the state Volunteer Firefighters Benefit Association in order to entitle relief association 
125.2 	members to membership in and the benefits of these associations or organizations; and
125.3 	(6)(5) for the payment of administrative expenses of the relief association as 
125.4 	authorized under section 69.80. 
125.5 	(b) For purposes of this chapter, a designated beneficiary must be a natural person.

125.6 	EFFECTIVE DATE. This section is effective January 1, 2009.

125.7 	Sec. 12. VOLUNTARY STATEWIDE VOLUNTEER FIREFIGHTER 
125.8 	RETIREMENT PLAN ADVISORY BOARD.
 125.9 		Subdivision 1.Definitions. (a) For purposes of this article, unless the context clearly 
125.10 	indicates otherwise, the terms or phrases in this subdivision have the meanings given them.
125.11 	(b) "Board" means the voluntary statewide lump-sum volunteer firefighter retirement 
125.12 	plan advisory board established under subdivision 2.
125.13 	(c) "Executive director" means the executive director of the Public Employees 
125.14 	Retirement Association.
125.15 	(d) "Fire department" means the agency or department of a municipality or an 
125.16 	independent nonprofit firefighting corporation that is charged with the prevention and 
125.17 	suppression of fire and other related emergency activities.
125.18 	(e) "Firetown" means the area serviced by any municipality having a qualified fire 
125.19 	department or a qualified incorporated fire department having a subsidiary volunteer 
125.20 	firefighters relief association.
125.21 		Subd. 2.Establishment. The voluntary statewide lump-sum volunteer firefighter 
125.22 	retirement plan advisory board is established.
125.23 		Subd. 3.Membership. (a) The voluntary statewide lump-sum volunteer firefighter 
125.24 	retirement plan advisory board consists of six persons. The members of the board must 
125.25 	be appointed as follows:
125.26 	(1) board seat A: a volunteer firefighter from a firetown with a population under 
125.27 	5,000 appointed by the president of the Minnesota State Fire Departments Association;
125.28 	(2) board seat B: a volunteer firefighter from a firetown with a population greater 
125.29 	than 5,000 and less than 9,001 appointed by the president of the Minnesota State Fire 
125.30 	Chiefs Association;
125.31 	(3) board seat C: a volunteer firefighter from a firetown with a population greater 
125.32 	than 9,000 and less than 20,000 appointed by the president of the Minnesota State Fire 
125.33 	Departments Association;
125.34 	(4) board seat D: a volunteer firefighter from a firetown with a population greater 
125.35 	than 19,999 appointed by the president of the Minnesota State Fire Chiefs Association;
126.1 	(5) board seat E: a person appointed by the president of the League of Minnesota 
126.2 	Cities; and
126.3 	(6) board seat F: a person appointed by the president of the Minnesota Association 
126.4 	of Townships.
126.5 	(b) The members of the board shall serve until August 1, 2009.
126.6 	(c) Service as a member of the board is uncompensated and does not qualify for 
126.7 	the reimbursement of expenses or for any per diem allowance by the state or the Public 
126.8 	Employees Retirement Association.
126.9 	(d) A vacancy on the board must be filled by appointment by the governor in 
126.10 	accordance with the requirements specified in paragraph (a).
126.11 		Subd. 4.Board duties. The board shall:
126.12 	(1) elect a chair; and
126.13 	(2) with the advice and administrative support of the executive director, draft 
126.14 	legislative recommendations for establishment, organization, and administration of the 
126.15 	voluntary statewide lump-sum volunteer firefighter retirement plan consistent with 
126.16 	this section, Minnesota Statutes, chapters 356 and 356A, and any other limitation or 
126.17 	requirement of law.
126.18 		Subd. 5.Information from municipalities and fire departments. Municipalities 
126.19 	and fire departments with volunteer firefighters who would be covered by the plan shall 
126.20 	provide all relevant information and records that the board or the executive director 
126.21 	requires to perform their duties.

126.22 	EFFECTIVE DATE. This section is effective the day following final enactment.

126.23 	Sec. 13.  REPEALER OF PRIOR INCONSISTENT SPECIAL VOLUNTEER 
126.24 	FIRE RELIEF ASSOCIATION ANCILLARY BENEFIT LEGISLATION.
 126.25 		Subdivision 1.Anoka. Laws 1969, chapter 352, section 1, subdivisions 3, 4, 5, 
126.26 	and 6, are repealed.
126.27 		Subd. 2.Butterfield. Laws 1975, chapter 185, section 1, is repealed.
126.28 		Subd. 3.Coon Rapids. Laws 1973, chapter 304, section 1, subdivisions 3, 4, 5, 6, 
126.29 	7, 8, and 9, are repealed.
126.30 		Subd. 4.Edina. (1) Laws 1965, chapter 592, section 3, as amended by Laws 1969, 
126.31 	chapter 644, section 2, and Laws 1975, chapter 229, section 2; (2) Laws 1965, chapter 
126.32 	592, section 4, as amended by Laws 1969, chapter 644, section 2, Laws 1975, chapter 229, 
126.33 	section 3, Laws 1985, chapter 261, section 37, and Laws 1991, chapter 125, section 1; (3) 
126.34 	Laws 1985, chapter 261, section 37, as amended by Laws 1991, chapter 125, section 1; 
126.35 	and (4) Laws 1991, chapter 125, section 1, are repealed.
127.1 		Subd. 5.Fairmont. Laws 1967, chapter 575, sections 2, as amended by Laws 1979, 
127.2 	chapter 201, section 23; 3; and 4, are repealed.
127.3 		Subd. 6.Falcon Heights. Laws 1969, chapter 526, sections 3; 4; 5, as amended 
127.4 	by Laws 1974, chapter 208, section 2; and 7, as amended by Laws 1974, chapter 208, 
127.5 	section 3, are repealed.
127.6 		Subd. 7.Golden Valley. Laws 1971, chapter 140, sections 2, as amended by Laws 
127.7 	1973, chapter 30, section 2; 3, as amended by Laws 1973, chapter 30, section 3; 4, as 
127.8 	amended by Laws 1973, chapter 30, section 4; and 5, as amended by Laws 1973, chapter 
127.9 	30, section 5; and Laws 1993, chapter 244, article 4, section 1, are repealed.
127.10 		Subd. 8.Wayzata. Laws 1973, chapter 472, section 1, as amended by Laws 1976, 
127.11 	chapter 272, section 1, and Laws 1979, chapter 201, section 33, is repealed.
127.12 		Subd. 9.White Bear Lake. Laws 1971, chapter 214, section 1, subdivisions 1, 2, 
127.13 	3, 4, and 5, are repealed.

127.14 	EFFECTIVE DATE; LOCAL APPROVAL. (a) Subdivision 1 is effective the day 
127.15 	after the governing body of Anoka and its chief clerical officer timely complete their 
127.16 	compliance with Minnesota Statutes, section 645.021, subdivisions 2 and 3, after June 
127.17 	30, 2009.
127.18 	(b) Subdivision 2 is effective the day after the governing body of Butterfield and its 
127.19 	chief clerical officer timely complete their compliance with Minnesota Statutes, section 
127.20 	645.021, subdivisions 2 and 3, after June 30, 2009.
127.21 	(c) Subdivision 3 is effective the day after the governing body of Coon Rapids and 
127.22 	its chief clerical officer timely complete their compliance with Minnesota Statutes, section 
127.23 	645.021, subdivisions 2 and 3, after June 30, 2009.
127.24 	(d) Subdivision 4 is effective the day after the governing body of Edina and its 
127.25 	chief clerical officer timely complete their compliance with Minnesota Statutes, section 
127.26 	645.021, subdivisions 2 and 3, after June 30, 2009.
127.27 	(e) Subdivision 5 is effective the day after the governing body of Fairmont and its 
127.28 	chief clerical officer timely complete their compliance with Minnesota Statutes, section 
127.29 	645.021, subdivisions 2 and 3, after June 30, 2009.
127.30 	(f) Subdivision 6 is effective the day after the governing body of Falcon Heights 
127.31 	and its chief clerical officer timely complete their compliance with Minnesota Statutes, 
127.32 	section 645.021, subdivisions 2 and 3, after June 30, 2009.
127.33 	(g) Subdivision 7 is effective the day after the governing body of Golden Valley and 
127.34 	its chief clerical officer timely complete their compliance with Minnesota Statutes, section 
127.35 	645.021, subdivisions 2 and 3, after June 30, 2009.
128.1 	(h) Subdivision 8 is effective the day after the governing body of Wayzata and its 
128.2 	chief clerical officer timely complete their compliance with Minnesota Statutes, section 
128.3 	645.021, subdivisions 2 and 3, after June 30, 2009.
128.4 	(i) Subdivision 9 is effective the day after the governing body of White Bear Lake 
128.5 	and its chief clerical officer timely complete their compliance with Minnesota Statutes, 
128.6 	section 645.021, subdivisions 2 and 3, after June 30, 2009.

128.7 	ARTICLE 16
128.8 	MEMBERSHIP DUES WITHHOLDING

128.9 	Section 1. [356.91] VOLUNTARY MEMBERSHIP DUES DEDUCTION.
128.10 	(a) Upon written authorization of a person receiving an annuity from a public 
128.11 	pension fund administered by the Minnesota State Retirement System, the Public 
128.12 	Employees Retirement Association, or the Minneapolis Employees Retirement Fund, the 
128.13 	executive director of the public pension fund may deduct from the retirement annuity an 
128.14 	amount requested by the annuitant to be paid as dues to any labor organization that is an 
128.15 	exclusive bargaining agent representing public employees or an organization representing 
128.16 	retired public employees of which the annuitant is a member and shall pay the amount to 
128.17 	the organization so designated by the annuitant.
128.18 	(b) A pension fund and the plan fiduciaries which authorize or administer deductions 
128.19 	of dues payments under paragraph (a) are not liable for failure to properly deduct or 
128.20 	transmit the dues amounts, provided that the fund and the fiduciaries have acted in good 
128.21 	faith.
128.22 	(c) The deductions under paragraph (a) may occur no more frequently than two 
128.23 	times per year.
128.24 	(d) Any labor organization specified in paragraph (a) shall reimburse the public 
128.25 	pension fund for the administrative expense of withholding premium amounts.

128.26 	EFFECTIVE DATE. This section is effective the day following final enactment.

128.27 	ARTICLE 17
128.28 	SMALL GROUP PROVISIONS

128.29 	Section 1. PUBLIC EMPLOYEES RETIREMENT ASSOCIATION COVERAGE 
128.30 	TERMINATION.
 128.31 		Subdivision 1.Eligibility. (a) An eligible individual specified in paragraph (b) 
128.32 	is authorized to apply for a retirement annuity, provided necessary age and service 
129.1 	requirements are met, under Minnesota Statutes, section 353.29 or 353.30, as applicable, 
129.2 	as further specified under subdivision 2.
129.3 	(b) An eligible individual is an individual who:
129.4 	(1) was employed by Independent School District No. 535, Rochester, on October 6, 
129.5 	1993, and became a member of the Public Employees Retirement Association coordinated 
129.6 	plan;
129.7 	(2) terminated from Independent School District No. 535, Rochester, on December 
129.8 	31, 2003;
129.9 	(3) was elected to the Rochester City Council on April 22, 2003, and sworn in on 
129.10 	May 5, 2003;
129.11 	(4) was reelected to the Rochester City Council and took office in November 2004;
129.12 	(5) continued to work for Olmsted County on a contract basis, while serving on 
129.13 	the city council;
129.14 	(6) elected under law then applicable to have Public Employees Retirement 
129.15 	Association coordinated plan coverage for the city council elected service; and 
129.16 	(7) terminated Independent School District No. 535, Rochester, employment but is 
129.17 	unable to commence receipt of a Public Employees Retirement Association coordinated 
129.18 	plan annuity because of the continuing Public Employees Retirement Association 
129.19 	coordinated plan coverage for the elected city council service and for Olmsted County.
129.20 		Subd. 2.Retirement annuity. (a) Notwithstanding an irrevocable election to 
129.21 	participate in the Public Employees Retirement Association coordinated plan as an elected 
129.22 	official and continuation of elected service, an eligible individual under subdivision 1, 
129.23 	paragraph (b), is deemed to have terminated membership under Minnesota Statutes, section 
129.24 	353.01, subdivision 11b, following termination of the Olmsted County employment.
129.25 	(b) If the requirements of paragraph (a) are satisfied, the eligible individual may 
129.26 	apply for a retirement annuity under Minnesota Statutes, section 353.29 or 353.30, as 
129.27 	applicable. In computing the annuity, the Public Employees Retirement Association 
129.28 	must exclude salary due to the elected Rochester City Council service. Deferred annuity 
129.29 	augmentation under Minnesota Statutes, section 353.71, applies to this annuity.
129.30 		Subd. 3.Treatment of Rochester City Council contributions to the Public 
129.31 	Employees Retirement Association. (a) All employee contributions to the Public 
129.32 	Employees Retirement Association coordinated plan by an eligible individual in 
129.33 	subdivision 1, paragraph (b), due to the elected Rochester City Council service, and all 
129.34 	corresponding employer contributions, must be determined.
129.35 	(b) An eligible individual under subdivision 1, paragraph (b), must elect, within 
129.36 	one year of the effective date of this section or upon termination of elective service, 
130.1 	whichever is earlier, a refund under Minnesota Statutes, section 353.34, subdivision 2, 
130.2 	of employee contributions determined under paragraph (a), or coverage by the public 
130.3 	employees defined contribution plan under Minnesota Statutes, chapter 353D, as further 
130.4 	specified in paragraph (c).
130.5 	(c) If public employee defined contribution plan coverage is elected under paragraph 
130.6 	(b), contributions to that plan commence as of the first day of the pay period following 
130.7 	this election, and accumulated employee and employer contributions determined under 
130.8 	paragraph (a) must be transferred with six percent annual interest to an account for the 
130.9 	eligible individual in the public employees defined contribution plan.
130.10 	(d) If no election is made by an eligible individual by the required date in paragraph 
130.11 	(b), the individual is assumed to have elected the refund indicated in paragraph (b).
130.12 	(e) Upon an election under paragraph (b), or a mandatory refund under paragraph 
130.13 	(d), all rights in the Public Employees Retirement Association coordinated plan due to 
130.14 	elected Rochester City Council service are forfeited and may not be reestablished.

130.15 	EFFECTIVE DATE. This section is effective the day following final enactment.

130.16 	Sec. 2. PERA-GENERAL; ST. PAUL PUBLIC WORKS EMPLOYEE; 
130.17 	RETIREMENT ANNUITY REVOCATION.
 130.18 	(a) Notwithstanding any provision of Minnesota Statutes, chapter 353, to the 
130.19 	contrary, an eligible person described in paragraph (b) is entitled to withdraw a retirement 
130.20 	annuity application previously filed with the general employees retirement plan of 
130.21 	the Public Employees Retirement Association and to apply for a disability benefit if 
130.22 	determined to have been totally and permanently disabled as of the date of the termination 
130.23 	of active employment.
130.24 	(b) An eligible person is a person who:
130.25 	(1) was born on March 9, 1949;
130.26 	(2) was an employee of the Department of Public Works of the city of St. Paul 
130.27 	prior to terminating active employment;
130.28 	(3) suffered an employment-related shoulder injury on May 9, 2006;
130.29 	(4) suffers from and has been treated for stress and related disorders; and
130.30 	(5) filed an application for a retirement annuity from the general employees 
130.31 	retirement plan of the Public Employees Retirement Association on December 12, 2006, 
130.32 	without being provided with a disability benefit application and without being provided 
130.33 	with any benefit counseling by the Public Employees Retirement Association.
130.34 	(c) If the eligible person, upon withdrawing the retirement annuity application 
130.35 	in writing and upon filing a disability benefit application with the Public Employees 
131.1 	Retirement Association, is determined to have been totally and permanently disabled as 
131.2 	of the date of the termination of active employment under Minnesota Statutes, sections 
131.3 	353.01, subdivision 19, and 353.33, the eligible person is entitled to receive a disability 
131.4 	benefit effective retroactively from the date on which the eligible person terminated active 
131.5 	employment, under the same annuity option selection made on December 12, 2006. The 
131.6 	amount of any increased benefit amount between the date of the termination of active 
131.7 	employment and the disability determination date is payable in a lump sum as soon as 
131.8 	is practicable following the disability determination date.
131.9 	(d) If the previously filed retirement annuity application is withdrawn under this 
131.10 	section and the eligible person is determined not to have been totally and permanently 
131.11 	disabled as of the date of the termination of active employment, the prior retirement 
131.12 	annuity application is reinstated.
131.13 	(e) The authority to withdraw a previously filed retirement annuity application under 
131.14 	this section expires on January 1, 2009.

131.15 	EFFECTIVE DATE. This section is effective the day following final enactment 
131.16 	and applies to any eligible person who was a public employee on December 1, 2006.

131.17 	Sec. 3. PERA-P&F; TRANSFER OF SERVICE CREDIT FOR PRIOR MAPLE 
131.18 	GROVE CITY EMPLOYMENT PERIOD.
 131.19 		Subdivision 1.Authorization. An eligible person described in subdivision 2 is 
131.20 	authorized to have service credit transferred under subdivision 3 upon the payment of the 
131.21 	additional amounts required under subdivision 4 and upon the substantiation of the nature 
131.22 	of the employment under subdivision 5.
131.23 		Subd. 2.Eligible person. For purposes of this section, an eligible person is a 
131.24 	person who:
131.25 	(1) was born on April 12, 1956;
131.26 	(2) was initially employed by the city of Maple Grove on February 16, 1988;
131.27 	(3) was employed as a full-time fire inspector by the fire-rescue department of the 
131.28 	city of Maple Grove, including daytime response to fire calls, with retirement coverage 
131.29 	by the coordinated program of the general employees retirement plan of the Public 
131.30 	Employees Retirement Association, on April 2, 1990; and
131.31 	(4) was transferred to retirement coverage by the public employees police and fire 
131.32 	retirement plan as a fire inspector by Maple Grove city council action on January 1, 1996.
131.33 		Subd. 3.Service credit transfer. (a) An eligible person, upon filing a written 
131.34 	application as prescribed by the executive director of the Public Employees Retirement 
131.35 	Association and upon compliance with subdivisions 4 and 5, shall have service credit 
132.1 	for the period from April 2, 1990, to January 1, 1996, transferred from the coordinated 
132.2 	program of the general employees retirement plan to the public employees police and 
132.3 	fire retirement plan on the first of the month next following the receipt of the additional 
132.4 	payments under subdivision 4.
132.5 	(b) Upon the transfer of service credit under paragraph (a), the service credit of 
132.6 	the eligible person in the coordinated program of the general employees retirement 
132.7 	plan for the period from April 2, 1990, to January 1, 1996, is forfeited and may not be 
132.8 	subsequently restored under Minnesota Statutes, section 353.35, or any other applicable 
132.9 	provision of law.
132.10 		Subd. 4.Additional payment amounts. (a) Accompanying the written application 
132.11 	under subdivision 3, the eligible person shall include an additional member contribution 
132.12 	payment for the period from April 2, 1990, to January 1, 1996. The additional member 
132.13 	contribution payment amount is the difference between the member contribution rate 
132.14 	under Minnesota Statutes, section 353.65, subdivision 2, and the member contribution rate 
132.15 	under Minnesota Statutes, section 353.27, subdivision 2, applied to the eligible person's 
132.16 	total covered salary for the period from April 2, 1990, to January 1, 1996, plus annual 
132.17 	compound interest from August 1, 1993, to the date on which the payment is made at the 
132.18 	rate of 8.5 percent.
132.19 	(b) Upon receipt of the additional member contributions under paragraph (a), the 
132.20 	executive director of the Public Employees Retirement Association shall notify the city 
132.21 	of Maple Grove that the payment was made and the amount of the additional employer 
132.22 	contribution. Within 30 days of the receipt of the notification from the Public Employees 
132.23 	Retirement Association, the city of Maple Grove shall pay the additional employer 
132.24 	contribution amount. The amount is the difference between the present value of the 
132.25 	eligible person's combined retirement annuity from the coordinated program of the general 
132.26 	employees retirement plan and from the public employees police and fire retirement plan 
132.27 	as of the end of the month preceding the payment of the additional member contribution 
132.28 	amount and the present value of the potential retirement annuity from the public employees 
132.29 	police and fire retirement plan if the service credit transfer occurred as of the same date, 
132.30 	reduced by the amount of the retirement plan asset transfer under paragraph (c) and by the 
132.31 	amount of the additional member contribution amount. The present value computation 
132.32 	must be made by the actuary retained under Minnesota Statutes, section 356.214, and must 
132.33 	utilize the applicable actuarial assumptions under Minnesota Statutes, section 356.215. 
132.34 	The additional employer contribution amount must be paid in a lump sum. If the additional 
132.35 	employer contribution payment is not made in a timely fashion, the executive director of 
132.36 	the Public Employees Retirement Association shall notify the commissioners of finance 
133.1 	and revenue of that fact and the commissioners shall deduct the required amount from any 
133.2 	state aid or other state payment amount applicable to the city, plus interest on the amount 
133.3 	at the rate of one percent per month from the payment due date to the actual payment date.
133.4 	(c) Upon the receipt of the additional member contribution under paragraph (a), the 
133.5 	executive director shall transfer an amount equal to double the eligible person's member 
133.6 	contributions to the coordinated program of the general employees retirement plan for the 
133.7 	period from April 2, 1990, to January 1, 1996, plus compound interest at the annual rate 
133.8 	of 8.5 percent from August 1, 1993, to the date of transfer from the general employees 
133.9 	retirement fund to the public employees police and fire retirement fund.
133.10 		Subd. 5.Public safety employment substantiation. Service credit is transferrable 
133.11 	under this section only if the employment for the city of Maple Grove by the eligible 
133.12 	person during the period from April 2, 1990, to January 1, 1996, is documented as 
133.13 	constituting firefighter employment sufficient to qualify for public employees police and 
133.14 	fire retirement plan membership and eligibility if the city of Maple Grove had adopted the 
133.15 	resolution under Minnesota Statutes, section 353.64, subdivision 2, as of April 2, 1990. 
133.16 	The city of Maple Grove and the eligible person must provide any relevant documentation 
133.17 	required by the executive director of the Public Employees Retirement Association.
133.18 		Subd. 6.Expiration. Authority to transfer service credit under this section expires 
133.19 	on July 1, 2009.

133.20 	EFFECTIVE DATE. This section is effective the day following final enactment.

133.21 	Sec. 4. TEACHERS RETIREMENT ASSOCIATION COVERAGE ELECTION 
133.22 	FOR CERTAIN MNSCU FACULTY MEMBERS.
 133.23 	(a) Notwithstanding any provision to the contrary of Minnesota Statutes, chapter 
133.24 	354B, an eligible person described in paragraph (b) may elect prospective and retroactive 
133.25 	retirement coverage under paragraph (c).
133.26 	(b) An eligible person is a person who:
133.27 	(1) was born on December 9, 1954;
133.28 	(2) was initially employed by the Minnesota State Colleges and Universities system 
133.29 	on a part-time basis at Metropolitan State University on January 12, 2004;
133.30 	(3) was first employed in excess of 25 percent of full-time employment by the 
133.31 	Minnesota State Colleges and Universities system on August 27, 2005;
133.32 	(4) was covered by the higher education individual retirement account plan because 
133.33 	of a failure of the Minnesota State Colleges and Universities system to advise about the 
133.34 	default retirement coverage provision of Minnesota Statutes, section 354B.21, subdivision 
133.35 	3; and
134.1 	(5) became a full-time employee of the Minnesota State Colleges and Universities 
134.2 	system as a full-time faculty member at Metropolitan State University on July 17, 2007.
134.3 	(c) An eligible person may elect retirement coverage by the Teachers Retirement 
134.4 	Association rather than the higher education individual retirement account plan for faculty 
134.5 	employment rendered after the date of the retirement coverage election under this section 
134.6 	and for past Minnesota State Colleges and Universities system faculty employment from 
134.7 	January 12, 2004, until the date of the retirement coverage election. The election must 
134.8 	be made in writing, must be filed with the executive director of the Teachers Retirement 
134.9 	Association, and must be accompanied with any relevant documentation required by the 
134.10 	executive director of the Teachers Retirement Association.
134.11 	(d) If an eligible person makes the retirement coverage election under paragraph (c), 
134.12 	the eligible person's member contributions to the higher education individual retirement 
134.13 	account plan must be transferred to the Teachers Retirement Association, with any earned 
134.14 	investment returns on those contributions. If the transferred member contributions and 
134.15 	investment earnings are less than the calculated amount of the member contribution that 
134.16 	the eligible person would have made to the Teachers Retirement Association on the 
134.17 	eligible person's compensation from the Minnesota State Colleges and Universities system 
134.18 	for the period from August 27, 2005, to the date of the retirement coverage election, if 
134.19 	the person had been covered by the Teachers Retirement Association during the period, 
134.20 	plus annual compound interest at the rate of 8.5 percent, the eligible person shall pay the 
134.21 	balance of that calculated member contribution obligation within 30 days of the retirement 
134.22 	coverage election. Any payment may be made through an institution-to-institution 
134.23 	transfer from the eligible person's account in the Minnesota state deferred compensation 
134.24 	program or the eligible person's tax-sheltered savings account under the federal Internal 
134.25 	Revenue Code, section 403(b).
134.26 	(e) Upon the transfer of the equivalent member contribution amount and any 
134.27 	additional payments under paragraph (d), the balance of the eligible person's higher 
134.28 	education individual retirement account plan account must be transferred to the Teachers 
134.29 	Retirement Association. If the amounts under paragraph (d) and the higher education 
134.30 	individual retirement account plan account balance under this paragraph are less than 
134.31 	the prior service credit purchase payment amount calculated under Minnesota Statutes, 
134.32 	section 356.551, the Minnesota State Colleges and Universities system shall pay that 
134.33 	difference within 60 days of the retirement coverage election date.
134.34 	(f) Upon the transfers and payments under paragraphs (d) and (e), the eligible 
134.35 	person must be credited by the Teachers Retirement Association with allowable and 
135.1 	formula service for Minnesota State Colleges and Universities system employment since 
135.2 	January 12, 2004.
135.3 	(g) The authority to make a retirement coverage election under this section expires 
135.4 	on January 1, 2009.

135.5 	EFFECTIVE DATE. This section is effective the day following final enactment.

135.6 	Sec. 5. TEACHERS RETIREMENT ASSOCIATION; SERVICE CREDIT 
135.7 	PURCHASE AUTHORIZATION.
 135.8 	(a) Notwithstanding any provision of Minnesota Statutes, chapter 354, to the 
135.9 	contrary, an eligible person described in paragraph (b) may purchase allowable and 
135.10 	formula service credit under Minnesota Statutes, section 354.05, subdivisions 13 and 25, 
135.11 	from the Teachers Retirement Association, for the period of prior out-of-state teaching 
135.12 	service specified in paragraph (c), by making the payment required under paragraph (d).
135.13 	(b) An eligible person is a person who:
135.14 	(1) was born on April 7, 1976;
135.15 	(2) was a teacher at the Edwardsville High School in O'Fallon, Illinois, during the 
135.16 	1998-1999, 1999-2000, 2000-2001, and 2001-2002 school years;
135.17 	(3) was a teacher for Independent School District No. 196, Rosemount, at the 
135.18 	Apple Valley High School during the 2002-2003, 2003-2004, 2004-2005, 2005-2006, 
135.19 	and 2006-2007 school years; and
135.20 	(4) was on a leave of absence from Independent School District No. 196, 
135.21 	Rosemount, for the 2007-2008 school year.
135.22 	(c) The period of prior service credit available for purchase is up to 4.188 years, 
135.23 	representing Illinois teaching service rendered during the 1998-1999, 1999-2000, 
135.24 	2000-2001, and 2001-2002 school years. The prior service credit may not exceed one year 
135.25 	of service credit in any school year and may not include any prior teaching service that 
135.26 	entitles the eligible person to a current or deferred age and service retirement annuity 
135.27 	or disability benefit from the Teachers Retirement Association or that was previously 
135.28 	subject to a prior service credit purchase from another defined benefit public employee 
135.29 	retirement plan.
135.30 	(d) The purchase payment amount under this section is the amount calculated under 
135.31 	Minnesota Statutes, section 356.551. If permitted by federal law and Illinois state law, the 
135.32 	purchase payment obligation may be met in whole or in part by an institution-to-institution 
135.33 	transfer of the eligible person's account balance in the Illinois Teachers Retirement System.
135.34 	(e) The election to purchase prior service credit under this section must be made 
135.35 	in writing and must be filed with the executive director of the Teachers Retirement 
136.1 	Association. The executive director of the Illinois Teachers Retirement System may 
136.2 	require the documentation of the applicability of this section and any other relevant 
136.3 	information from the eligible person.

136.4 	EFFECTIVE DATE; EXPIRATION. This section is effective the day following 
136.5 	final enactment and expires on January 1, 2010.

136.6 	Sec. 6. REVISED TOTAL AND PERMANENT DISABILITY BENEFIT, 
136.7 	MINNEAPOLIS BOMB SQUAD DISABILITANT.
 136.8 	(a) Notwithstanding Minnesota Statutes 2007 Supplement, section 353.656, 
136.9 	subdivision 1a, to the contrary, an eligible person specified in paragraph (b) is entitled 
136.10 	to the benefit specified in paragraph (c).
136.11 	(b) An eligible person is a person who:
136.12 	(1) was born on September 9, 1964;
136.13 	(2) was injured on February 9, 2005, while working as a police officer on the city of 
136.14 	Minneapolis bomb squad, causing traumatic brain injury;
136.15 	(3) because of ineligibility for coverage under the federal Old Age, Survivors, and 
136.16 	Disability Insurance Program, is not eligible for federal Old Age, Survivors, and Disability 
136.17 	Insurance Program disability benefits; and
136.18 	(4) commenced receiving public employees police and fire retirement plan disability 
136.19 	benefits on August 12, 2006.
136.20 	(c) The disability benefit payable to an eligible person specified in paragraph (b) is 
136.21 	75 percent of average salary as defined in Minnesota Statutes, section 353.01, subdivision 
136.22 	17a. The benefit specified in this paragraph commences on the first day of the month after 
136.23 	the effective date, and is in lieu of the disability benefit otherwise provided by law.

136.24 	EFFECTIVE DATE. This section is effective the day following final enactment.

136.25 	Sec. 7. PERA CONSOLIDATED INDEPENDENT SCHOOL DISTRICT NO. 
136.26 	2859, GLENCOE/SILVER LAKE, ANNUITANT WAIVER OF REPAYMENT 
136.27 	REQUIREMENT.
 136.28 	(a) Notwithstanding any provisions of Minnesota Statutes 2007 Supplement, section 
136.29 	353.01, subdivision 28, to the contrary, an eligible person described in paragraph (b) must 
136.30 	be considered by the executive director of the Public Employees Retirement Association 
136.31 	to have retired on September 30, 2003, although the person rendered service in October 
136.32 	2003 as an employee of an independent contractor which provided services to the same 
137.1 	governmental subdivision from which the individual terminated service on September 
137.2 	30, 2003.
137.3 	(b) An eligible person is a person who:
137.4 	(1) was born on November 13, 1944;
137.5 	(2) was hired on August 17, 1964, by Independent School District No. 422, 
137.6 	Glencoe, predecessor of the now consolidated Independent School District No. 2859, 
137.7 	Glencoe/Silver Lake, with coverage by the general employees retirement plan of the 
137.8 	Public Employees Retirement Association;
137.9 	(3) terminated employment as manager of the grounds and transportation for the 
137.10 	school district on September 30, 2003; and
137.11 	(4) relying upon incomplete or erroneous information provided by the Public 
137.12 	Employees Retirement Association regarding separation from service requirements as it 
137.13 	applies to independent contractor employment, became an employee in October 2003 of 
137.14 	the independent contractor providing bus service for the same school district.
137.15 	(c) Notwithstanding Minnesota Statutes, section 353.27, subdivision 7b, an eligible 
137.16 	person described in paragraph (b) must not be required to repay, through suspension 
137.17 	or reduction of the annuity or any other means, any Public Employees Retirement 
137.18 	Association general plan retirement annuity amount received before December 31, 2004.

137.19 	EFFECTIVE DATE. This section is effective the day following final enactment.

137.20 	Sec. 8. PERA-GENERAL; CITY OF ST. PAUL EMPLOYEE SERVICE CREDIT 
137.21 	PURCHASE.
 137.22 	(a) An eligible person described in paragraph (b) is entitled to purchase allowable 
137.23 	service credit from the general employees retirement plan of the Public Employees 
137.24 	Retirement Association for the period of employment by the city of St. Paul between 
137.25 	May 1, 1982, and March 31, 1984, that qualified as employment by a public employee 
137.26 	under Minnesota Statutes 1982, section 353.01, subdivision 2, that was not previously 
137.27 	credited by the retirement plan.
137.28 	(b) An eligible person is a person who:
137.29 	(1) was born on March 25, 1960;
137.30 	(2) was first employed by the city of St. Paul on April 23, 1979;
137.31 	(3) qualified for Public Employees Retirement Association general plan coverage in 
137.32 	May 1982 but was not reported by the city of St. Paul to the Public Employees Retirement 
137.33 	Association for coverage until April 1984; and
137.34 	(4) became a member of the general employees retirement plan of the Public 
137.35 	Employees Retirement Association in April 1984.
138.1 	(c) The eligible person described in paragraph (b) is authorized to apply with the 
138.2 	executive director of the Public Employees Retirement Association to make the service 
138.3 	credit purchase under this section. The application must be in writing and must include 
138.4 	all necessary documentation of the applicability of this section and any other relevant 
138.5 	information that the executive director may require.
138.6 	(d) Allowable service credit under Minnesota Statutes, section 353.01, subdivision 
138.7 	16, must be granted by the general employees retirement plan of the Public Employees 
138.8 	Retirement Association to the account of the eligible person upon the receipt of the prior 
138.9 	service credit purchase payment amount required under Minnesota Statutes, section 
138.10 	356.551.
138.11 	(e) Of the prior service credit purchase payment amount under Minnesota Statutes, 
138.12 	section 356.551, the eligible person must pay an amount equal to the employee 
138.13 	contribution rate or rates in effect during the uncredited employment period applied to the 
138.14 	actual salary rates in effect during the period, plus annual compound interest at the rate 
138.15 	of 8.5 percent from the date the member contribution payment should have been made 
138.16 	if made in a timely fashion until the date on which the contribution is actually made. If 
138.17 	the equivalent member contribution payment, plus interest, is made, the city of St. Paul 
138.18 	shall pay the balance of the total prior service credit purchase payment amount under 
138.19 	Minnesota Statutes, section 356.551, within 60 days of notification by the executive 
138.20 	director of the Public Employees Retirement Association that the member contribution 
138.21 	equivalent payment has been received by the association.
138.22 	(f) Authority for an eligible person to make a prior service credit purchase under 
138.23 	this section expires on June 30, 2009, or upon termination of employment covered by the 
138.24 	Public Employees Retirement Association, whichever is earlier.
138.25 	(g) If the city of St. Paul fails to pay its portion of the prior service credit purchase 
138.26 	payment amount under paragraph (e), the executive director of the Public Employees 
138.27 	Retirement Association must notify the commissioners of finance and revenue of that fact 
138.28 	and the commissioners shall order the deduction of the required payment amount from 
138.29 	the next payment of any state aid to the city of St. Paul and the commissioners shall 
138.30 	transmit the applicable amount to the general employees retirement fund of the Public 
138.31 	Employees Retirement Association.

138.32 	EFFECTIVE DATE. This section is effective the day following final enactment.

138.33 	Sec. 9. ST. PAUL SCHOOL BOARD; PRIOR SERVICE PURCHASE.
 138.34 	(a) An eligible person described in paragraph (b) is entitled to purchase prior 
138.35 	uncredited service rendered as a member of the board of education of Independent School 
139.1 	District No. 625, St. Paul, from the defined contribution retirement plan of the Public 
139.2 	Employees Retirement Association.
139.3 	(b) An eligible person is a person who has one of the following combinations of 
139.4 	date of birth, date of initial membership on the board of education of Independent School 
139.5 	District No. 625, St. Paul, and first enrolled in the public employees defined contribution 
139.6 	plan:

139.7
139.8
139.9139.10
	person
	birth date
	date of initial school board 
membership
	date of enrollment 
in public 
employees defined 
contribution plan
	
139.11	A
	January 10, 1955
		January 1, 2000
		August 28, 2007
	
139.12	B
	May 15, 1957
		January 1, 2006
		January 20, 2007
	
139.13	C
	May 7, 1960
		January 1, 1992
		February 17, 1998
	
139.14	D
	July 16, 1969
		January 1, 2004
		April 13, 2007
	
139.15 	(c) To make the purchase, eligible persons A, B, and D shall pay an amount equal to 
139.16 	five percent of the salary of the eligible person between the date of the initial school board 
139.17 	membership and the date of enrollment in the public employees defined contribution plan, 
139.18 	plus compound interest on that amount from the midpoint of that period to the date of 
139.19 	payment. To make the purchase, eligible person C shall make two payments, one before 
139.20 	December 15, 2008, and the other after January 1, 2009, and before January 31, 2010, 
139.21 	each in an amount equal to 2.5 percent of the salary of the eligible person between January 
139.22 	1, 1992, and February 17, 1998, plus compound interest on that amount at the rate of six 
139.23 	percent from July 1, 1994, to the date of payment.
139.24 	(d) If the eligible person makes the payment under paragraph (c), Independent 
139.25 	School District No. 625, St. Paul, shall pay an amount equal to the payment amount or 
139.26 	amounts under paragraph (c). The employer payment or payments must be made within 
139.27 	ten days of the date of notification of the eligible person's payment by the executive 
139.28 	director of the Public Employees Retirement Association.
139.29 	(e) This authority expires on May 31, 2010, or on the first day of the month next 
139.30 	following the conclusion of the eligible member's elected public service, whichever 
139.31 	occurs earlier. 

139.32 	EFFECTIVE DATE. This section is effective the day following final enactment.

139.33 	Sec. 10. TEACHERS RETIREMENT ASSOCIATION; SERVICE CREDIT 
139.34 	PURCHASE AUTHORIZATION.
 139.35 	(a) Notwithstanding any provision of Minnesota Statutes, chapter 354, to the 
139.36 	contrary, unless the period to be purchased is credited as allowable service by another 
140.1 	retirement plan covered by Minnesota Statutes, section 356.30, or is ineligible for credit as 
140.2 	allowable or formula service under Minnesota Statutes, chapter 354, an eligible person 
140.3 	described in paragraph (b) may purchase allowable and formula service credit under 
140.4 	Minnesota Statutes, section 354.05, subdivisions 13 and 25, from the Teachers Retirement 
140.5 	Association, for the period specified in paragraph (c), by making the payment required 
140.6 	under paragraph (d). 
140.7 	(b) An eligible person is a person who: 
140.8 	(1) was born on December 8, 1974; and 
140.9 	(2) took a leave of absence from teaching in Wayzata, Independent School District, 
140.10 	No. 284, from January, 2006, through March, 2006, during which the person did not 
140.11 	receive allowable and formula service credit from the Teachers Retirement Association. 
140.12 	(c) The period of prior service credit available for purchase is 26.5 days. 
140.13 	(d) The purchase payment amount under this section is the amount calculated in 
140.14 	Minnesota Statutes, section 356.551. 
140.15 	(e) The election to purchase prior service credit under this section must be made 
140.16 	in writing and must be filed with the executive director of the Teachers Retirement 
140.17 	Association. The executive director may require documentation of the applicability of this 
140.18 	section and any other relevant information from the eligible person.

140.19 	EFFECTIVE DATE; EXPIRATION. (a) This section is effective the day 
140.20 	following final enactment.
140.21 	(b) This section expires on June 30, 2009.

140.22 	Sec. 11. MSRS-UNCLASSIFIED PROGRAM; MARITAL PROPERTY 
140.23 	DIVISION.
 140.24 	(a) An eligible state employee described in paragraph (b) may elect to have the 
140.25 	person's account in the unclassified state employees retirement program of the Minnesota 
140.26 	State Retirement System governed by Minnesota Statutes, chapter 352D, divided as 
140.27 	provided in a marital property division decree as part of a marriage dissolution action prior 
140.28 	to the date on which the person terminates state employment.
140.29 	(b) An eligible state employee is a person who:
140.30 	(1) was born on July 19, 1953;
140.31 	(2) was employed by the State Lottery in October 1989; and
140.32 	(3) filed a marital property division decree from a marriage dissolution action with 
140.33 	the executive director of the Minnesota State Retirement System.
140.34 	(c) The former spouse of an eligible state employee, following the division election 
140.35 	under paragraph (a), may, upon filing a written application, withdraw the cash value 
141.1 	of the shares to the credit of the former spouse or leave those shares on deposit in the 
141.2 	supplemental investment fund.
141.3 	(d) If the eligible state employee described in paragraph (b) exercises a retirement 
141.4 	coverage transfer option election under Minnesota Statutes, section 352D.02, subdivision 
141.5 	3, and if the eligible state employee had previously exercised the division election under 
141.6 	paragraph (a), the redemption of shares by the eligible state employee under Minnesota 
141.7 	Statutes, section 352D.02, subdivision 3, is limited to the employee's portion of the total 
141.8 	account amount and the allowable service credit of the employee in the general state 
141.9 	employees retirement plan obtained by the election must bear the same relationship 
141.10 	to the total state employment of the employee that the employee's portion of the total 
141.11 	account bears to the total account amount. An election by an eligible state employee 
141.12 	under Minnesota Statutes, section 352D.02, subdivision 3, does not apply to the former 
141.13 	spouse and does not prevent the former spouse from utilizing Minnesota Statutes, section 
141.14 	352D.05, at any time after the division election under paragraph (a) is made or Minnesota 
141.15 	Statutes, section 352D.06, when the former spouse attains at least age 55.
141.16 	(e) A division election under paragraph (a) is irrevocable.

141.17 	EFFECTIVE DATE. This section is effective the day following final enactment.

141.18 	ARTICLE 18
141.19 	PENSION COMMISSION MEMBERSHIP

141.20 	Section 1. Minnesota Statutes 2006, section 3.85, subdivision 3, is amended to read:
141.21 		Subd. 3.Membership. The commission consists of five seven members of the 
141.22 	senate appointed by the Subcommittee on Committees of the Committee on Rules and 
141.23 	Administration and five seven members of the house of representatives appointed by 
141.24 	the speaker. No more than five members from each chamber may be from the majority 
141.25 	caucus in that chamber. Members shall be appointed at the commencement of each regular 
141.26 	session of the legislature for a two-year term beginning January 16 of the first year of the 
141.27 	regular session. Members continue to serve until their successors are appointed. Vacancies 
141.28 	that occur while the legislature is in session shall be filled like regular appointments. If the 
141.29 	legislature is not in session, senate vacancies shall be filled by the last Subcommittee on 
141.30 	Committees of the senate Committee on Rules and Administration or other appointing 
141.31 	authority designated by the senate rules, and house vacancies shall be filled by the last 
141.32 	speaker of the house, or if the speaker is not available, by the last chair of the house 
141.33 	Rules Committee.

141.34 	EFFECTIVE DATE. This section is effective January 1, 2009.