1.1 	A bill for an act
1.2 	relating to retirement; regulating volunteer firefighters' relief associations; 
1.3 	reorganizing the defined contribution relief association provisions; recodifying 
1.4 	the general volunteer firefighters' relief association law; making conforming 
1.5 	changes;amending Minnesota Statutes 2008, sections 69.031, subdivision 5; 
1.6 	69.771, subdivision 3; 69.772, subdivisions 4, 6; 69.773, subdivision 6; 356.219, 
1.7 	subdivision 3; 424A.001, subdivisions 1, 1a, 2, 3, 4, 5, 6, 8, 9, 10, by adding 
1.8 	subdivisions; 424A.01; 424A.02, subdivisions 1, 2, 3, 3a, 6, 7, 8, 9, 9a, 9b, 10, 
1.9 	12, 13; 424A.021; 424A.03; 424A.04; 424A.05, subdivisions 1, 2, 3, 4; 424A.06; 
1.10 	424A.07; 424A.08; 424A.10, subdivisions 1, 2, 3, 4, 5; 424B.10, subdivision 2, 
1.11 	by adding subdivisions; 424B.21; proposing coding for new law in Minnesota 
1.12 	Statutes, chapters 420; 424A; 424B; repealing Minnesota Statutes 2008, sections 
1.13 	424A.001, subdivision 7; 424A.02, subdivisions 4, 6, 8a, 8b, 9b; 424A.09; 
1.14 	424B.10, subdivision 1.
1.15 	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

1.16 	ARTICLE 1
1.17 	REORGANIZATION AND RECODIFICATION OF
1.18 	VOLUNTEER FIREFIGHTER RETIREMENT PROVISIONS

1.19 	Section 1. [420.20] PROHIBITION OF SERVICE BY MINORS AS VOLUNTEER 
1.20 	FIREFIGHTERS.
1.21 	It is unlawful for any municipality or independent nonprofit firefighting corporation 
1.22 	to employ a minor to serve as a volunteer firefighter or to permit a minor to serve in any 
1.23 	capacity performing any firefighting duties with a volunteer fire department.

1.24 	Sec. 2. Minnesota Statutes 2008, section 424A.001, subdivision 1, is amended to read:
1.25 		Subdivision 1.Terms defined. Unless the context clearly indicates otherwise, as 
1.26 	used in this chapter, the terms defined in this section have the meanings given.

2.1 	Sec. 3. Minnesota Statutes 2008, section 424A.001, subdivision 1a, is amended to read:
2.2 		Subd. 1a.Ancillary benefit. "Ancillary benefit" means a benefit payable from the 
2.3 	special fund of the relief association other than a service pension that is permitted by law 
2.4 	and that is provided for in the relief association bylaws.

2.5 	Sec. 4. Minnesota Statutes 2008, section 424A.001, is amended by adding a 
2.6 	subdivision to read:
2.7 		Subd. 1b.Defined benefit relief association. "Defined benefit relief association" 
2.8 	means a volunteer firefighters' relief association that provides a lump-sum service pension, 
2.9 	provides a monthly benefit service pension, or provides a lump-sum service pension as an 
2.10 	alternative to the monthly benefit service pension.

2.11 	Sec. 5. Minnesota Statutes 2008, section 424A.001, is amended by adding a 
2.12 	subdivision to read:
2.13 		Subd. 1c.Defined contribution relief association. "Defined contribution relief 
2.14 	association" means a volunteer firefighters' relief association that provides a service 
2.15 	pension based solely on an individual account balance rather than a specified annual 
2.16 	lump-sum or monthly benefit service pension amount.

2.17 	Sec. 6. Minnesota Statutes 2008, section 424A.001, subdivision 2, is amended to read:
2.18 		Subd. 2.Fire department. "Fire department" includes a municipal fire department 
2.19 	andor an independent nonprofit firefighting corporation.

2.20 	Sec. 7. Minnesota Statutes 2008, section 424A.001, subdivision 3, is amended to read:
2.21 		Subd. 3.Municipality. "Municipality" means a municipality which has 
2.22 	established a fire department with which the relief association is directly associated, or 
2.23 	the municipalities which have entered into a contract with the independent nonprofit 
2.24 	firefighting corporation of which the relief association is a subsidiary.

2.25 	Sec. 8. Minnesota Statutes 2008, section 424A.001, subdivision 4, is amended to read:
2.26 		Subd. 4.Relief association. "Relief association" means (a)(1) a volunteer 
2.27 	firefighters' relief association or a volunteer firefighters' division or account of a partially 
2.28 	salaried and partially volunteer firefighters' relief association that is organized and 
2.29 	incorporated under chapter 317A and any laws of the state, is governed by this chapter 
2.30 	and chapter 69, and is directly associated with a fire department established by municipal 
2.31 	ordinance; or (b)(2) any separateseparately incorporated volunteer firefighters' relief 
3.1 	association that is subsidiary to and providingthat provides service pension and retirement 
3.2 	benefit coverage for members of an independent nonprofit firefighting corporation that is 
3.3 	organized under the provisions of chapter 317A, is governed by this chapter, and operating
3.4 	operates exclusively for firefighting purposes. A relief association is a governmental entity 
3.5 	that receives and manages public money to provide retirement benefits for individuals 
3.6 	providing the governmental services of firefighting and emergency first response.

3.7 	Sec. 9. Minnesota Statutes 2008, section 424A.001, subdivision 5, is amended to read:
3.8 		Subd. 5.Special fund. "Special fund" means the special fund of a volunteer 
3.9 	firefighters' relief association or the account for volunteer firefighters within the special 
3.10 	fund of a partially salaried and partially volunteer firefighters' relief association.

3.11 	Sec. 10. Minnesota Statutes 2008, section 424A.001, subdivision 6, is amended to read:
3.12 		Subd. 6.Surviving spouse. For purposes of this chapter, and the governing bylaws 
3.13 	of anygoverning a relief association to which this chapter applies, the term "surviving 
3.14 	spouse" means the spouse of a deceased member who was legally married to the member 
3.15 	at the time of the member's death.

3.16 	Sec. 11. Minnesota Statutes 2008, section 424A.001, subdivision 8, is amended to read:
3.17 		Subd. 8.Firefighting service. "Firefighting service," if the applicable municipality 
3.18 	approves for a fire department that is a municipal department, or if the applicable 
3.19 	contracting municipality or municipalities approve for a fire department that is an 
3.20 	independent nonprofit firefighting corporation, includes fire department service rendered 
3.21 	by fire prevention personnel.

3.22 	Sec. 12. Minnesota Statutes 2008, section 424A.001, subdivision 9, is amended to read:
3.23 		Subd. 9.Separate from active service. "Separate from active service" means 
3.24 	tothat a firefighter permanently ceaseceases to perform fire suppression duties with 
3.25 	a particular volunteer fire department, to permanently ceaseceases to perform fire 
3.26 	prevention duties, to permanently ceaseceases to supervise fire suppression duties, and to
3.27 	permanently ceaseceases to supervise fire prevention duties.

3.28 	Sec. 13. Minnesota Statutes 2008, section 424A.001, subdivision 10, is amended to 
3.29 	read:
3.30 		Subd. 10.Volunteer firefighter. "Volunteer firefighter" means a person who either:
4.1 	(1) was a member of the applicable fire department or the independent nonprofit 
4.2 	firefighting corporation and a member of the relief association on July 1, 2006; or
4.3 	(2) became a member of the applicable fire department or the independent nonprofit 
4.4 	firefighting corporation and is eligible for membership in the applicable relief association 
4.5 	after June 30, 2006, and
4.6 	(i) is engaged in providing emergency response services or delivering fire education 
4.7 	or prevention services as a member of a municipal fire department, a joint powers entity 
4.8 	fire department, or an independent nonprofit firefighting corporation;
4.9 	(ii) is trained in or is qualified to provide fire suppression duties or to provide fire 
4.10 	prevention duties under subdivision 8; and
4.11 	(iii) meets any other minimum firefighter and service standards established by the 
4.12 	fire department or the independent nonprofit firefighting corporation or specified in the 
4.13 	articles of incorporation or bylaws of the relief association.

4.14 	Sec. 14. [424A.002] AUTHORIZATION OF NEW OR CONTINUING 
4.15 	VOLUNTEER FIREFIGHTERS' RELIEF ASSOCIATIONS.
4.16 		Subdivision 1.Authorization. A municipal fire department or an independent 
4.17 	nonprofit firefighting corporation, with approval by the applicable municipality or 
4.18 	municipalities, may establish a new volunteer firefighters' relief association or may retain 
4.19 	an existing volunteer firefighters' relief association.
4.20 		Subd. 2.Defined benefit or defined contribution relief association. The articles 
4.21 	of incorporation or the bylaws of the volunteer firefighters' relief association must specify 
4.22 	that the relief association is either a defined benefit relief association subject to sections 
4.23 	69.771 to 69.774, 424A.015, and 424A.02 or is a defined contribution relief association 
4.24 	subject to sections 424A.015 and 424A.016.

4.25 	Sec. 15. Minnesota Statutes 2008, section 424A.01, is amended to read:
4.26 	424A.01 MEMBERSHIP IN A VOLUNTEER FIREFIGHTERS' RELIEF 
4.27 	ASSOCIATION.
4.28 		Subdivision 1.Minors. It is unlawful for anyNo volunteer firefighters' relief 
4.29 	association associated with a municipality or an independent nonprofit firefighting 
4.30 	corporation to employmay include as a relief association member a minor serving as 
4.31 	a volunteer firefighter or to permit a minor to serve in any capacity performing any 
4.32 	firefighting duties with a volunteer fire department.
4.33 		Subd. 2.Status of substitute volunteer firefighters. No person who is serving as a 
4.34 	substitute volunteer firefighter shall be deemedmay be considered to be a firefighter for 
5.1 	purposes of chapter 69 or this chapter nor shall beand no substitute volunteer firefighter is 
5.2 	authorized to be a member of any volunteer firefighters' relief association governed by 
5.3 	chapter 69 or this chapter.
5.4 		Subd. 3.Status of nonmember volunteer firefighters. No person who is serving 
5.5 	as a firefighter in a fire department but who is not a member of the applicable firefighters' 
5.6 	relief association shall beis entitled to any service pension or ancillary benefits from 
5.7 	the relief association.
5.8 		Subd. 4.Exclusion of persons constituting an unwarranted health risk. The 
5.9 	board of trustees of every relief association may exclude from membership in the relief 
5.10 	association all applicants who, due to some medically determinable physical or mental 
5.11 	impairment or condition, wouldis determined to constitute a predictable and unwarranted 
5.12 	risk of imposing liability for an ancillary benefit at any age earlier than the minimum 
5.13 	age specified for receipt of a service pension. Notwithstanding any provision of section 
5.14 	363A.25, it shall beis a good and valid defense to a complaint or action brought under 
5.15 	chapter 363A that the board of trustees of the relief association made a good faith 
5.16 	determination that the applicant suffers from an impairment or condition constituting a 
5.17 	predictable and unwarranted risk for the relief association if the determination was made 
5.18 	following consideration of: (a)(1) the person's medical history; and (b)(2) the report of 
5.19 	the physician completing a physical examination of the applicant completedundertaken at 
5.20 	the expense of the relief association.
5.21 		Subd. 5.Fire prevention personnel. (a) If the fire department is a municipal 
5.22 	department and the applicable municipality approves, or if the fire department is an 
5.23 	independent nonprofit firefighting corporation and the contracting municipality or 
5.24 	municipalities approve, the fire department may employ or otherwise utilize the services 
5.25 	of persons as volunteer firefighters to perform fire prevention duties and to supervise 
5.26 	fire prevention activities.
5.27 	(b) Personnel serving in fire prevention positions are eligible to be members of 
5.28 	the applicable volunteer firefighter relief association and to qualify for service pension 
5.29 	or other benefit coverage of the relief association on the same basis as fire department 
5.30 	personnel who perform fire suppression duties.
5.31 	(c) Personnel serving in fire prevention positions also are eligible to receive any 
5.32 	other benefits under the applicable law or practice for services on the same basis as 
5.33 	personnel who are employed to perform fire suppression duties.

5.34 	Sec. 16. [424A.015] GENERALLY APPLICABLE VOLUNTEER 
5.35 	FIREFIGHTERS' RELIEF ASSOCIATION PENSION PLAN REGULATION.
6.1 		Subdivision 1.Separation from active service; exception. (a) No service pension 
6.2 	is payable to a person while the person remains an active member of the respective fire 
6.3 	department, and a person who is receiving a service pension is not entitled to receive any 
6.4 	other benefits from the special fund of the relief association.
6.5 	(b) No relief association as defined in section 424A.001, subdivision 4, may pay a 
6.6 	service pension or disability benefit to a former member of the relief association if that 
6.7 	person has not separated from active service with the fire department to which the relief 
6.8 	association is directly associated, unless: 
6.9 	(1) the person is employed subsequent to retirement by the municipality or the 
6.10 	independent nonprofit firefighting corporation, whichever applies, to perform duties within 
6.11 	the municipal fire department or corporation on a full-time basis;
6.12 	(2) the governing body of the municipality or of the corporation has filed its 
6.13 	determination with the board of trustees of the relief association that the person's 
6.14 	experience with and service to the fire department in that person's full-time capacity 
6.15 	would be difficult to replace; and
6.16 	(3) the bylaws of the relief association were amended to provide for the payment of 
6.17 	a service pension or disability benefit for such full-time employees.
6.18 		Subd. 2.No assignment or garnishment. A service pension or ancillary benefits 
6.19 	paid or payable from the special fund of a relief association to any person receiving or 
6.20 	entitled to receive a service pension or ancillary benefits is not subject to garnishment, 
6.21 	judgment, execution, or other legal process, except as provided in section 518.58, 518.581, 
6.22 	or 518A.53. No person entitled to a service pension or ancillary benefits from the special 
6.23 	fund of a relief association may assign any service pension or ancillary benefit payments, 
6.24 	and the association does not have the authority to recognize any assignment or pay over 
6.25 	any sum which has been assigned.
6.26 		Subd. 3.Purchase of annuity contract. A relief association that provides a service 
6.27 	pension in a single payment, if the governing articles of incorporation or bylaws so 
6.28 	provide, may purchase an annuity contract on behalf of a retiring member in an amount 
6.29 	equal to the service pension otherwise payable at the request of the person and in place of 
6.30 	a direct payment to the person. The annuity contract must be purchased from an insurance 
6.31 	carrier licensed to do business in this state.
6.32 		Subd. 4.Transfer to individual retirement account. A relief association that is a 
6.33 	qualified pension plan under section 401(a) of the Internal Revenue Code, as amended, 
6.34 	and that provides a single payment service pension, at the written request of the applicable 
6.35 	retiring member or, following the death of the active member, at the written request of the 
6.36 	deceased member's surviving spouse, may directly transfer on an institution-to-institution 
7.1 	basis the eligible member's lump-sum pension or the death, funeral, or survivor benefit 
7.2 	attributable to the member, whichever applies, to the requesting person's individual 
7.3 	retirement account under section 408(a) of the Internal Revenue Code, as amended.

7.4 	Sec. 17. [424A.016] DEFINED CONTRIBUTION VOLUNTEER 
7.5 	FIREFIGHTERS' RELIEF ASSOCIATION SPECIFIC REGULATION.
7.6 		Subdivision 1.Defined contribution relief association authorization. If the 
7.7 	articles of incorporation or the bylaws governing the volunteer firefighters' relief 
7.8 	association so provide exclusively, the relief association may pay a defined contribution 
7.9 	lump-sum service pension instead of a defined benefit service pension governed by section 
7.10 	424A.02.
7.11 		Subd. 2.Defined contribution service pension eligibility. (a) A relief association, 
7.12 	when its articles of incorporation or bylaws so provide, may pay out of the assets of its 
7.13 	special fund a service pension to each of its members who:
7.14 	(1) separates from active service with the fire department;
7.15 	(2) reaches age 50;
7.16 	(3) completes at least five years of active service as an active member of the 
7.17 	municipal fire department to which the relief association is associated;
7.18 	(4) completes at least five years of active membership with the relief association 
7.19 	before separation from active service; and
7.20 	(5) complies with any additional conditions as to age, service, and membership that 
7.21 	are prescribed by the bylaws of the relief association.
7.22 	(b) In the case of a member who has completed at least five years of active service as 
7.23 	an active member of the fire department to which the relief association is associated on 
7.24 	the date that the relief association is established and incorporated, the requirement that 
7.25 	the member complete at least five years of active membership with the relief association 
7.26 	before separation from active service may be waived by the board of trustees of the relief 
7.27 	association if the member completes at least five years of inactive membership with the 
7.28 	relief association before the date of the payment of the service pension. During the period 
7.29 	of inactive membership, the member is not entitled to receive any disability benefit 
7.30 	coverage, is not entitled to receive additional individual account allocation of fire state 
7.31 	aid or municipal contribution towards a service pension, and is considered to have the 
7.32 	status of a person entitled to a deferred service pension.
7.33 	(c) The service pension earned by a volunteer under this chapter and the articles 
7.34 	of incorporation and bylaws of the relief association may be paid whether or not the 
8.1 	municipality or nonprofit firefighting corporation to which the relief association is 
8.2 	associated qualifies for the receipt of fire state aid under chapter 69.
8.3 		Subd. 3.Reduced vesting schedule. If the articles of incorporation or bylaws of a 
8.4 	defined contribution relief association so provide, a relief association may pay a reduced 
8.5 	service pension not to exceed the nonforfeitable percentage of the account balance to a 
8.6 	retiring member who has completed fewer than 20 years of service. The reduced service 
8.7 	pension may be paid when the retiring member meets the minimum age and service 
8.8 	requirements of subdivision 2. The nonforfeitable percentage of pension amounts are 
8.9 	as follows:

8.10
8.11		Completed Years of Service
	Nonforfeitable Percentage 
of Pension Amount
	
8.12		5
		40 percent
	
8.13		6
		52 percent
	
8.14		7
		64 percent
	
8.15		8
		76 percent
	
8.16		9
		88 percent
	
8.17		10
	and thereafter
	100 percent
	
8.18 		Subd. 4.Individual accounts. (a) An individual account must be established for 
8.19 	each firefighter who is a member of the relief association.
8.20 	(b) To each individual active member account must be credited an equal share of:
8.21 	(1) amounts of fire state aid received by the relief association;
8.22 	(2) amounts of municipal contributions to the relief association raised from levies on 
8.23 	real estate or from other available municipal revenue sources exclusive of fire state aid; and
8.24 	(3) amounts equal to the share of the assets of the special fund to the credit of:
8.25 	(i) any former member who terminated active service with the fire department to 
8.26 	which the relief association is associated before meeting the minimum service requirement 
8.27 	provided for in subdivision 2, paragraph (b), and has not returned to active service with 
8.28 	the fire department for a period no shorter than five years; or
8.29 	(ii) any retired member who retired before obtaining a full nonforfeitable interest in 
8.30 	the amounts credited to the individual member account under subdivision 2, paragraph 
8.31 	(b), and any applicable provision of the bylaws of the relief association. In addition, any 
8.32 	investment return on the assets of the special fund must be credited in proportion to the 
8.33 	share of the assets of the special fund to the credit of each individual active member 
8.34 	account. Administrative expenses of the relief association payable from the special 
8.35 	fund may be deducted from individual accounts in a manner specified in the bylaws of 
8.36 	the relief association. 
9.1 	(c) Amounts to be credited to individual accounts must be allocated uniformly 
9.2 	for all years of active service and allocations must be made for all years of service, 
9.3 	except as otherwise provided in this section. The allocation method may utilize monthly 
9.4 	proration for fractional years of service, if the bylaws or articles of incorporation of the 
9.5 	relief association so provide.
9.6 	(d) At the time of retirement under subdivision 2 and any applicable provision of the 
9.7 	bylaws of the relief association, a retiring member is entitled to that portion of the assets 
9.8 	of the special fund to the credit of the member in the individual member account which is 
9.9 	nonforfeitable under subdivision 3 and any applicable provision of the bylaws of the relief 
9.10 	association based on the number of years of service to the credit of the retiring member.
9.11 	(e) Annually, the secretary of the relief association shall certify the individual 
9.12 	account allocations to the state auditor at the same time that the annual financial statement 
9.13 	or financial report and audit of the relief association, whichever applies, is due under 
9.14 	section 69.051.
9.15 		Subd. 5.Service pension installment payments. At the option of the retiring 
9.16 	member and in lieu of a single payment of a service pension, a defined contribution relief 
9.17 	association may pay the service pension in installments, if the governing bylaws so 
9.18 	provide. The election of installment payments is irrevocable and must be made by the 
9.19 	retiring member in writing and filed with the secretary of the relief association no later 
9.20 	than 30 days before the commencement of payment of the service pension. The amount of 
9.21 	the installment payments must be the fractional portion of the remaining account balance 
9.22 	equal to one divided by the number of remaining annual installment payments.
9.23 		Subd. 6.Deferred service pensions. (a) A member of a relief association is entitled 
9.24 	to a deferred service pension if the member:
9.25 	(1) has completed the lesser of the minimum period of active service with the fire 
9.26 	department specified in the bylaws or 20 years of active service with the fire department;
9.27 	(2) has completed at least five years of active membership in the relief association; 
9.28 	and
9.29 	(3) separates from active service and membership before reaching age 50 or the 
9.30 	minimum age for retirement and commencement of a service pension specified in the 
9.31 	bylaws governing the relief association if that age is greater than age 50.
9.32 	(b) The deferred service pension is payable when the former member reaches age 
9.33 	50, or the minimum age specified in the bylaws governing the relief association if that age 
9.34 	is greater than age 50, and when the former member makes a valid written application.
9.35 	(c) A defined contribution relief association may, if its governing bylaws so provide, 
9.36 	credit interest or additional investment performance on the deferred lump-sum service 
10.1 	pension during the period of deferral. If provided for in the bylaws, the interest must be 
10.2 	paid:
10.3 	(1) at the investment performance rate actually earned on that portion of the assets 
10.4 	if the deferred benefit amount is invested by the relief association in a separate account 
10.5 	established and maintained by the relief association or if the deferred benefit amount is 
10.6 	invested in a separate investment vehicle held by the relief association; or 
10.7 	(2) the investment return on the assets of the special fund of the defined contribution 
10.8 	volunteer firefighter relief association in proportion to the share of the assets of the special 
10.9 	fund to the credit of each individual deferred member account through the date on which 
10.10 	the investment return is recognized by and credited to the special fund.
10.11 	(d) The deferred service pension is governed by and must be calculated under 
10.12 	the general statute, special law, relief association articles of incorporation, and relief 
10.13 	association bylaw provisions applicable on the date on which the member separated from 
10.14 	active service with the fire department and active membership in the relief association.
10.15 		Subd. 7.Limitation on ancillary benefits. (a) A defined contribution relief 
10.16 	association may only pay an ancillary benefit which would constitute an authorized 
10.17 	disbursement as specified in section 424A.05. The ancillary benefit for active members 
10.18 	must equal the vested or nonvested amount of the individual account of the member.
10.19 	(b) For deferred members, the ancillary benefit must equal the vested amount of 
10.20 	the individual account of the member. For the recipient of installment payments of a 
10.21 	service pension, the ancillary benefit must equal the remaining balance in the individual 
10.22 	account of the recipient.
10.23 		Subd. 8.Repayment of service pension in certain instances. If a retired volunteer 
10.24 	firefighter does not permanently separate from active firefighting service as required 
10.25 	by subdivision 1 and section 424A.001, subdivision 9, by resuming active service as a 
10.26 	firefighter in the same volunteer fire department or as a person in charge of firefighters in 
10.27 	the same volunteer fire department, no additional service pension amount is payable to the 
10.28 	person, no additional individual account allocation may be made to the person, and the 
10.29 	person must repay to the relief association any previously received service pension.
10.30 		Subd. 9.Filing of bylaw amendments. Each relief association to which this section 
10.31 	applies must file a revised copy of its governing bylaws with the state auditor upon the 
10.32 	adoption of any amendment to its governing bylaws by the relief association. Failure of 
10.33 	the relief association to file a copy of the bylaws or any bylaw amendments with the state 
10.34 	auditor disqualifies the municipality from the distribution of any future fire state aid until 
10.35 	this filing requirement has been completed.

11.1 	Sec. 18. Minnesota Statutes 2008, section 424A.02, subdivision 1, is amended to read:
11.2 		Subdivision 1.Authorization. (a) A defined benefit relief association, when its 
11.3 	articles of incorporation or bylaws so provide, may pay out of the assets of its special fund 
11.4 	a service pension to each of its members who: (1) separates from active service with the 
11.5 	fire department; (2) reaches age 50; (3) completes at least five years of active service 
11.6 	as an active member of the municipal fire department to which the relief association 
11.7 	is associated; (4) completes at least five years of active membership with the relief 
11.8 	association before separation from active service; and (5) complies with any additional 
11.9 	conditions as to age, service, and membership that are prescribed by the bylaws of the 
11.10 	relief association. A service pension computed under this section may be prorated 
11.11 	monthly for fractional years of service, if the bylaws or articles of incorporation of the 
11.12 	relief association so provide. The service pension earned by a volunteer firefighter under 
11.13 	this chapter and the articles of incorporation and bylaws of the volunteer firefighters' 
11.14 	relief association may be paid whether or not the municipality or nonprofit firefighting 
11.15 	corporation to which the relief association is associated qualifies for the receipt of fire 
11.16 	state aid under chapter 69.
11.17 	(b) In the case of a member who has completed at least five years of active service as 
11.18 	an active member of the fire department to which the relief association is associated on 
11.19 	the date that the relief association is established and incorporated, the requirement that 
11.20 	the member complete at least five years of active membership with the relief association 
11.21 	before separation from active service may be waived by the board of trustees of the relief 
11.22 	association if the member completes at least five years of inactive membership with the 
11.23 	relief association before the date of the payment of the service pension. During the 
11.24 	period of inactive membership, the member is not entitled to receive disability benefit 
11.25 	coverage, is not entitled to receive additional service credit towards computation of a 
11.26 	service pension, and is considered to have the status of a person entitled to a deferred 
11.27 	service pension under subdivision 7.
11.28 	(c) No municipality or nonprofit firefighting corporation may delegate the power to 
11.29 	take final action in setting a service pension or ancillary benefit amount or level to the 
11.30 	board of trustees of the relief association or to approve in advance a service pension or 
11.31 	ancillary benefit amount or level equal to the maximum amount or level that this chapter 
11.32 	would allow rather than a specific dollar amount or level.
11.33 	(d) No relief association as defined in section 424A.001, subdivision 4, may pay a 
11.34 	service pension or disability benefit to a former member of the relief association if that 
11.35 	person has not separated from active service with the fire department to which the relief 
11.36 	association is directly associated, unless:
12.1 	(1) the person is employed subsequent to retirement by the municipality or the 
12.2 	independent nonprofit firefighting corporation, whichever applies, to perform duties within 
12.3 	the municipal fire department or corporation on a full-time basis;
12.4 	(2) the governing body of the municipality or of the corporation has filed its 
12.5 	determination with the board of trustees of the relief association that the person's 
12.6 	experience with and service to the fire department in that person's full-time capacity 
12.7 	would be difficult to replace; and
12.8 	(3) the bylaws of the relief association were amended to provide for the payment of 
12.9 	a service pension or disability benefit for such full-time employees.

12.10 	Sec. 19. Minnesota Statutes 2008, section 424A.02, subdivision 2, is amended to read:
12.11 		Subd. 2.Nonforfeitable portion of service pension. (a) If the articles of 
12.12 	incorporation or bylaws of a defined benefit relief association so provide, athe relief 
12.13 	association may pay a reduced service pension to a retiring member who has completed 
12.14 	fewer than 20 years of service. The reduced service pension may be paid when the retiring 
12.15 	member meets the minimum age and service requirements of subdivision 1.
12.16 	(b) The amount of the reduced service pension may not exceed the amount calculated 
12.17 	by multiplying the service pension appropriate for the completed years of service as 
12.18 	specified in the bylaws timesmultiplied by the applicable nonforfeitable percentage of 
12.19 	pension.
12.20 	(c) For a defined benefit volunteer firefighter relief association that pays a lump-sum 
12.21 	service pension, a monthly benefit service pension, or a lump-sum service pension or a 
12.22 	monthly benefit service pension as alternative benefit forms, the nonforfeitable percentage 
12.23 	of pension amounts are as follows:

12.24
12.25		Completed Years of Service
	Nonforfeitable Percentage of 
Pension Amount
	
12.26		5
		40 percent
		
12.27		6
		44 percent
		
12.28		7
		48 percent
		
12.29		8
		52 percent
		
12.30		9
		56 percent
		
12.31		10
		60 percent
		
12.32		11
		64 percent
		
12.33		12
		68 percent
		
12.34		13
		72 percent
		
12.35		14
		76 percent
		
12.36		15
		80 percent
		
12.37		16
		84 percent
		
12.38		17
		88 percent
		
13.1		18
		92 percent
		
13.2		19
		96 percent
		
13.3		20
	and thereafter
	100 percent
		
13.4 	(d) For a volunteer firefighter relief association that pays a defined contribution 
13.5 	service pension, the nonforfeitable percentage of pension amounts are as follows:

13.6
13.7		Completed Years of Service
	Nonforfeitable Percentage of 
Pension Amount 
	
13.8		5
		40 percent
		
13.9		6
		52 percent
		
13.10		7
		64 percent
		
13.11		8
		76 percent
		
13.12		9
		88 percent
		
13.13		10
	and thereafter
	100 percent

13.14 	Sec. 20. Minnesota Statutes 2008, section 424A.02, subdivision 3, is amended to read:
13.15 		Subd. 3.Flexible service pension maximums. (a) Annually on or before August 1 
13.16 	as part of the certification of the financial requirements and minimum municipal obligation 
13.17 	determined under section 69.772, subdivision 4, or 69.773, subdivision 5, as applicable, 
13.18 	the secretary or some other official of the relief association designated in the bylaws of 
13.19 	each defined benefit relief association shall calculate and certify to the governing body 
13.20 	of the applicable qualified municipality the average amount of available financing per 
13.21 	active covered firefighter for the most recent three-year period. The amount of available 
13.22 	financing shall includeincludes any amounts of fire state aid received or receivable by the 
13.23 	relief association, any amounts of municipal contributions to the relief association raised 
13.24 	from levies on real estate or from other available revenue sources exclusive of fire state 
13.25 	aid, and one-tenth of the amount of assets in excess of the accrued liabilities of the relief 
13.26 	association calculated under section 69.772, subdivision 2; 69.773, subdivisions 2 and 4; 
13.27 	or 69.774, subdivision 2, if any.
13.28 	(b) The maximum service pension which the defined benefit relief association has 
13.29 	authority to provide for in its bylaws for payment to a member retiring after the calculation 
13.30 	date when the minimum age and service requirements specified in subdivision 1 are met 
13.31 	must be determined using the table in paragraph (c) or (d), whichever applies.
13.32 	(c) For a defined benefit relief association where the governing bylaws provide for 
13.33 	a monthly service pension to a retiring member, the maximum monthly service pension 
13.34 	amount per month for each year of service credited that may be provided for in the bylaws 
13.35 	is the greater of the service pension amount provided for in the bylaws on the date of the 
13.36 	calculation of the average amount of the available financing per active covered firefighter 
14.1 	or the maximum service pension figure corresponding to the average amount of available 
14.2 	financing per active covered firefighter:

14.3
14.4
14.5	Minimum Average Amount of Available 
Financing per Firefighter
	Maximum Service Pension Amount 
Payable per Month for Each 
Year of Service
	
14.6	$ ...
		$ .25
		
14.7	41
		.50
		
14.8	81
		1.00
		
14.9	122
		1.50
		
14.10	162
		2.00
		
14.11	203
		2.50
		
14.12	243
		3.00
		
14.13	284
		3.50
		
14.14	324
		4.00
		
14.15	365
		4.50
		
14.16	405
		5.00
		
14.17	486
		6.00
		
14.18	567
		7.00
		
14.19	648
		8.00
		
14.20	729
		9.00
		
14.21	810
		10.00
		
14.22	891
		11.00
		
14.23	972
		12.00
		
14.24	1053
		13.00
		
14.25	1134
		14.00
		
14.26	1215
		15.00
		
14.27	1296
		16.00
		
14.28	1377
		17.00
		
14.29	1458
		18.00
		
14.30	1539
		19.00
		
14.31	1620
		20.00
		
14.32	1701
		21.00
		
14.33	1782
		22.00
		
14.34	1823
		22.50
		
14.35	1863
		23.00
		
14.36	1944
		24.00
		
14.37	2025
		25.00
		
14.38	2106
		26.00
		
14.39	2187
		27.00
		
14.40	2268
		28.00
		
14.41	2349
		29.00
		
14.42	2430
		30.00
		
14.43	2511
		31.00
		
14.44	2592
		32.00
		
15.1	2673
		33.00
		
15.2	2754
		34.00
		
15.3	2834
		35.00
		
15.4	2916
		36.00
		
15.5	2997
		37.00
		
15.6	3078
		38.00
		
15.7	3159
		39.00
		
15.8	3240
		40.00
		
15.9	3321
		41.00
		
15.10	3402
		42.00
		
15.11	3483
		43.00
		
15.12	3564
		44.00
		
15.13	3645
		45.00
		
15.14	3726
		46.00
		
15.15	3807
		47.00
		
15.16	3888
		48.00
		
15.17	3969
		49.00
		
15.18	4050
		50.00
		
15.19	4131
		51.00
		
15.20	4212
		52.00
		
15.21	4293
		53.00
		
15.22	4374
		54.00
		
15.23	4455
		55.00
		
15.24	4536
		56.00
		
15.25	Effective beginning December 31, 2008
			
15.26	4617
		57.00
		
15.27	4698
		58.00
		
15.28	4779
		59.00
		
15.29	4860
		60.00
		
15.30	4941
		61.00
		
15.31	5022
		62.00
		
15.32	5103
		63.00
		
15.33	5184
		64.00
		
15.34	5265
		65.00
		
15.35	Effective beginning December 31, 2009
			
15.36	5346
		66.00
		
15.37	5427
		67.00
		
15.38	5508
		68.00
		
15.39	5589
		69.00
		
15.40	5670
		70.00
		
15.41	5751
		71.00
		
15.42	5832
		72.00
		
15.43	5913
		73.00
		
16.1	5994
		74.00
		
16.2	Effective beginning December 31, 2010
			
16.3	6075
		75.00
		
16.4	6156
		76.00
		
16.5	6237
		77.00
		
16.6	6318
		78.00
		
16.7	6399
		79.00
		
16.8	6480
		80.00
		
16.9	6561
		81.00
		
16.10	6642
		82.00
		
16.11	6723
		83.00
		
16.12	Effective beginning December 31, 2011
			
16.13	6804
		84.00
		
16.14	6885
		85.00
		
16.15	6966
		86.00
		
16.16	7047
		87.00
		
16.17	7128
		88.00
		
16.18	7209
		89.00
		
16.19	7290
		90.00
		
16.20	7371
		91.00
		
16.21	7452
		92.00
		
16.22	Effective beginning December 31, 2012
			
16.23	7533
		93.00
		
16.24	7614
		94.00
		
16.25	7695
		95.00
		
16.26	7776
		96.00
		
16.27	7857
		97.00
		
16.28	7938
		98.00
		
16.29	8019
		99.00
		
16.30	8100
		100.00
		
16.31	any amount in excess of 
				
16.32	8100
		100.00
		
16.33 	(d) For a defined benefit relief association in which the governing bylaws provide 
16.34 	for a lump-sum service pension to a retiring member, the maximum lump-sum service 
16.35 	pension amount for each year of service credited that may be provided for in the bylaws is 
16.36 	the greater of the service pension amount provided for in the bylaws on the date of the 
16.37 	calculation of the average amount of the available financing per active covered firefighter 
16.38 	or the maximum service pension figure corresponding to the average amount of available 
16.39 	financing per active covered firefighter for the applicable specified period:

17.1
17.2
17.3	Minimum Average Amount of Available 
Financing per Firefighter
	Maximum Lump-Sum Service 
Pension Amount Payable for 
Each Year of Service
	
17.4	$ ...
		$ 10
		
17.5	11
		20
		
17.6	16
		30
		
17.7	23
		40
		
17.8	27
		50
		
17.9	32
		60
		
17.10	43
		80
		
17.11	54
		100
		
17.12	65
		120
		
17.13	77
		140
		
17.14	86
		160
		
17.15	97
		180
		
17.16	108
		200
		
17.17	131
		240
		
17.18	151
		280
		
17.19	173
		320
		
17.20	194
		360
		
17.21	216
		400
		
17.22	239
		440
		
17.23	259
		480
		
17.24	281
		520
		
17.25	302
		560
		
17.26	324
		600
		
17.27	347
		640
		
17.28	367
		680
		
17.29	389
		720
		
17.30	410
		760
		
17.31	432
		800
		
17.32	486
		900
		
17.33	540
		1000
		
17.34	594
		1100
		
17.35	648
		1200
		
17.36	702
		1300
		
17.37	756
		1400
		
17.38	810
		1500
		
17.39	864
		1600
		
17.40	918
		1700
		
17.41	972
		1800
		
17.42	1026
		1900
		
17.43	1080
		2000
		
17.44	1134
		2100
		
18.1	1188
		2200
		
18.2	1242
		2300
		
18.3	1296
		2400
		
18.4	1350
		2500
		
18.5	1404
		2600
		
18.6	1458
		2700
		
18.7	1512
		2800
		
18.8	1566
		2900
		
18.9	1620
		3000
		
18.10	1672
		3100
		
18.11	1726
		3200
		
18.12	1753
		3250
		
18.13	1780
		3300
		
18.14	1820
		3375
		
18.15	1834
		3400
		
18.16	1888
		3500
		
18.17	1942
		3600
		
18.18	1996
		3700
		
18.19	2023
		3750
		
18.20	2050
		3800
		
18.21	2104
		3900
		
18.22	2158
		4000
		
18.23	2212
		4100
		
18.24	2265
		4200
		
18.25	2319
		4300
		
18.26	2373
		4400
		
18.27	2427
		4500
		
18.28	2481
		4600
		
18.29	2535
		4700
		
18.30	2589
		4800
		
18.31	2643
		4900
		
18.32	2697
		5000
		
18.33	2751
		5100
		
18.34	2805
		5200
		
18.35	2859
		5300
		
18.36	2913
		5400
		
18.37	2967
		5500
		
18.38	3021
		5600
		
18.39	3075
		5700
		
18.40	3129
		5800
		
18.41	3183
		5900
		
18.42	3237
		6000
		
18.43	3291
		6100
		
19.1	3345
		6200
		
19.2	3399
		6300
		
19.3	3453
		6400
		
19.4	3507
		6500
		
19.5	3561
		6600
		
19.6	3615
		6700
		
19.7	3669
		6800
		
19.8	3723
		6900
		
19.9	3777
		7000
		
19.10	3831
		7100
		
19.11	3885
		7200
		
19.12	3939
		7300
		
19.13	3993
		7400
		
19.14	4047
		7500
		
19.15	Effective beginning December 31, 2008
			
19.16	4101
		7600
		
19.17	4155
		7700
		
19.18	4209
		7800
		
19.19	4263
		7900
		
19.20	4317
		8000
		
19.21	4371
		8100
		
19.22	4425
		8200
		
19.23	4479
		8300
		
19.24	Effective beginning December 31, 2009
			
19.25	4533
		8400
		
19.26	4587
		8500
		
19.27	4641
		8600
		
19.28	4695
		8700
		
19.29	4749
		8800
		
19.30	4803
		8900
		
19.31	4857
		9000
		
19.32	4911
		9100
		
19.33	Effective beginning December 31, 2010
			
19.34	4965
		9200
		
19.35	5019
		9300
		
19.36	5073
		9400
		
19.37	5127
		9500
		
19.38	5181
		9600
		
19.39	5235
		9700
		
19.40	5289
		9800
		
19.41	5343
		9900
		
19.42	5397
		10,000
		
20.1	any amount in excess of
				
20.2	5397
		10,000
		
20.3 	(e) For a defined benefit relief association in which the governing bylaws provide 
20.4 	for a monthly benefit service pension as an alternative form of service pension payment 
20.5 	to a lump-sum service pension, the maximum service pension amount for each pension 
20.6 	payment type must be determined using the applicable table contained in this subdivision.
20.7 	(f) If a defined benefit relief association establishes a service pension in compliance 
20.8 	with the applicable maximum contained in paragraph (c) or (d) and the minimum average 
20.9 	amount of available financing per active covered firefighter is subsequently reduced 
20.10 	because of a reduction in fire state aid or because of an increase in the number of active 
20.11 	firefighters, the relief association may continue to provide the prior service pension 
20.12 	amount specified in its bylaws, but may not increase the service pension amount until 
20.13 	the minimum average amount of available financing per firefighter under the table in 
20.14 	paragraph (c) or (d), whichever applies, permits.
20.15 	(g) No defined benefit relief association is authorized to provide a service pension in 
20.16 	an amount greater than the largest applicable flexible service pension maximum amount 
20.17 	even if the amount of available financing per firefighter is greater than the financing 
20.18 	amount associated with the largest applicable flexible service pension maximum.
20.19 	(h) The method of calculating service pensions must be applied uniformly for all 
20.20 	years of active service and credit must be given for all years of active service except as 
20.21 	otherwise provided in this section.

20.22 	Sec. 21. Minnesota Statutes 2008, section 424A.02, subdivision 3a, is amended to read:
20.23 		Subd. 3a.Penalty for paying pension greater than applicable maximum. (a) 
20.24 	If a defined benefit relief association pays a service pension greater than the maximum 
20.25 	service pension associated with the applicable average amount of available financing per 
20.26 	active covered firefighter under the table in subdivision 3, paragraph (c) or (d), whichever 
20.27 	applies, the maximum service pension under subdivision 3, paragraph (f), or the applicable 
20.28 	maximum service pension amount specified in subdivision 3, paragraph (g), whichever is 
20.29 	less, the state auditor shall:
20.30 	(1) disqualify the municipality or the nonprofit firefighting corporation associated 
20.31 	with the relief association from receiving fire state aid by making the appropriate 
20.32 	notification to the municipality and the commissioner of revenue, with the disqualification 
20.33 	applicable for the next apportionment and payment of fire state aid; and
20.34 	(2) recover the amount of the overpaid service pension or pensions from any retired 
20.35 	firefighter who received an overpayment.
21.1 	(b) Fire state aid amounts from disqualified municipalities for the period of 
21.2 	disqualifications under paragraph (a), clause (1), must be credited to the amount of 
21.3 	fire insurance premium tax proceeds available for the next subsequent fire state aid 
21.4 	apportionment.
21.5 	(c) The amount of any overpaid service pension recovered under paragraph (a), 
21.6 	clause (2), must be credited to the amount of fire insurance premium tax proceeds 
21.7 	available for the next subsequent fire state aid apportionment.
21.8 	(d) The determination of the state auditor that a relief association has paid a service 
21.9 	pension greater than the applicable maximum must be made on the basis of the information 
21.10 	filed by the relief association and the municipality with the state auditor under sections 
21.11 	69.011, subdivision 2, and 69.051, subdivision 1 or 1a, whichever applies, and any other 
21.12 	relevant information that comes to the attention of the state auditor. The determination 
21.13 	of the state auditor is final. An aggrieved municipality, relief association, or person may 
21.14 	appeal the determination under section 480A.06.

21.15 	Sec. 22. Minnesota Statutes 2008, section 424A.02, subdivision 7, is amended to read:
21.16 		Subd. 7.Deferred service pensions. (a) A member of a defined benefit relief 
21.17 	association is entitled to a deferred service pension if the member:
21.18 	(1) has completed the lesser of either the minimum period of active service with 
21.19 	the fire department specified in the bylaws or 20 years of active service with the fire 
21.20 	department;
21.21 	(2) has completed at least five years of active membership in the relief association; 
21.22 	and
21.23 	(3) separates from active service and membership before reaching age 50 or the 
21.24 	minimum age for retirement and commencement of a service pension specified in the 
21.25 	bylaws governing the relief association if that age is greater than age 50.
21.26 	(b) The deferred service pension is payable when the former member reaches age 
21.27 	50, or the minimum age specified in the bylaws governing the relief association if that age 
21.28 	is greater than age 50, and when the former member makes a valid written application.
21.29 	(c) A defined benefit relief association that provides a lump-sum service pension 
21.30 	governed by subdivision 3 may, when its governing bylaws so provide, pay interest on the 
21.31 	deferred lump-sum service pension during the period of deferral. If provided for in the 
21.32 	bylaws, interest must be paid in one of the following manners:
21.33 	(1) at the investment performance rate actually earned on that portion of the assets 
21.34 	if the deferred benefit amount is invested by the relief association in a separate account 
22.1 	established and maintained by the relief association or if the deferred benefit amount is 
22.2 	invested in a separate investment vehicle held by the relief association; or
22.3 	(2) at an interest rate of up to five percent, compounded annually, as set by the board 
22.4 	of directors and approved as provided in subdivision 10.
22.5 	(d) Interest under paragraph (c), clause (2), is payable following the date on which 
22.6 	the municipality has approved the deferred service pension interest rate established by 
22.7 	the board of trustees.
22.8 	(e) A relief association that provides a defined contribution service pension may, 
22.9 	if its governing bylaws so provide, credit interest or additional investment performance 
22.10 	on the deferred lump-sum service pension during the period of deferral. If provided for 
22.11 	in the bylaws, the interest must be paid in one of the manners specified in paragraph 
22.12 	(c) or alternatively the relief association may credit any investment return on the assets 
22.13 	of the special fund of the defined contribution volunteer firefighter relief association in 
22.14 	proportion to the share of the assets of the special fund to the credit of each individual 
22.15 	deferred member account through the date on which the investment return is recognized 
22.16 	by and credited to the special fund.
22.17 	(f)(e) For a deferred service pension that is transferred to a separate account 
22.18 	established and maintained by the relief association or separate investment vehicle held 
22.19 	by the relief association, the deferred member bears the full investment risk subsequent 
22.20 	to transfer and in calculating the accrued liability of the volunteer firefighters relief 
22.21 	association that pays a lump-sum service pension, the accrued liability for deferred service 
22.22 	pensions is equal to the separate relief association account balance or the fair market value 
22.23 	of the separate investment vehicle held by the relief association.
22.24 	(g)(f) The deferred service pension is governed by and must be calculated under 
22.25 	the general statute, special law, relief association articles of incorporation, and relief 
22.26 	association bylaw provisions applicable on the date on which the member separated from 
22.27 	active service with the fire department and active membership in the relief association.

22.28 	Sec. 23. Minnesota Statutes 2008, section 424A.02, subdivision 8, is amended to read:
22.29 		Subd. 8.Lump-sum service pensions; installment payments. (a) AnyA defined 
22.30 	benefit relief association, if the governing bylaws so provide, may pay, at the option of 
22.31 	the retiring member and in lieu of a single payment of a lump-sum service pension, a 
22.32 	lump-sum service pension in installments.
22.33 	(b) The election of installment payments shall beis irrevocable and shallmust 
22.34 	be made by the retiring member in writing and filed with the secretary of the relief 
22.35 	association no later than 30 days prior to the commencement of payment of the service 
23.1 	pension. The amount of the installment payments shallmust be determined so that the 
23.2 	present value of the aggregate installment payments computed at an interest rate of five 
23.3 	percent, compounded annually, is equal to the amount of the single lump-sum payment 
23.4 	which would have been made had the installment payments option not been elected. 
23.5 	The payment of each installment shallmust include interest at the rate of five percent, 
23.6 	compounded annually on the reserve supporting the remaining installment payments as 
23.7 	of the date on which the previous installment payment was paid and computed from the 
23.8 	date on which the previous installment payment was paid to the date of payment for 
23.9 	the current installment payment.
23.10 	(c) To the extent that the commissioner of commercestate auditor deems it to be 
23.11 	necessary or practical, the commissionerstate auditor may specify and issue procedures, 
23.12 	forms or mathematical tables for use in performing the calculations required pursuant to
23.13 	under this subdivision.

23.14 	Sec. 24. Minnesota Statutes 2008, section 424A.02, subdivision 9, is amended to read:
23.15 		Subd. 9.Limitation on ancillary benefits. AnyA defined benefit relief association, 
23.16 	including any volunteer firefighters relief association governed by section 69.77 or any 
23.17 	volunteer firefighters division of a relief association governed by chapter 424, may only 
23.18 	pay ancillary benefits which would constitute an authorized disbursement as specified in 
23.19 	section 424A.05 subject to the following requirements or limitations:
23.20 	(1) with respect to a defined benefit relief association in which governing bylaws 
23.21 	provide for a lump-sum service pension to a retiring member, no ancillary benefit may 
23.22 	be paid to any former member or paid to any person on behalf of any former member 
23.23 	after the former member (i) terminates active service with the fire department and active 
23.24 	membership in the relief association; and (ii) commences receipt of a service pension as 
23.25 	authorized under this section; and
23.26 	(2) with respect to any defined benefit relief association, no ancillary benefit paid or 
23.27 	payable to any member, to any former member, or to any person on behalf of any member 
23.28 	or former member, may exceed in amount the total earned service pension of the member 
23.29 	or former member. The total earned service pension must be calculated by multiplying 
23.30 	the service pension amount specified in the bylaws of the relief association at the time of 
23.31 	death or disability, whichever applies, by the years of service credited to the member or 
23.32 	former member. The years of service must be determined as of (i) the date the member or 
23.33 	former member became entitled to the ancillary benefit; or (ii) the date the member or 
23.34 	former member died entitling a survivor or the estate of the member or former member to 
23.35 	an ancillary benefit. The ancillary benefit must be calculated without regard to whether the 
24.1 	member had attained the minimum amount of service and membership credit specified in 
24.2 	the governing bylaws. For active members, the amount of a permanent disability benefit 
24.3 	or a survivor benefit must be equal to the member's total earned service pension except 
24.4 	that the bylaws of anya defined benefit relief association may provide for the payment of 
24.5 	a survivor benefit in an amount not to exceed five times the yearly service pension amount 
24.6 	specified in the bylaws on behalf of any member who dies before having performed five 
24.7 	years of active service in the fire department with which the relief association is affiliated.

24.8 	Sec. 25. Minnesota Statutes 2008, section 424A.02, subdivision 9a, is amended to read:
24.9 		Subd. 9a.Postretirement increases. Notwithstanding any provision of general or 
24.10 	special law to the contrary, a defined benefit relief association paying a monthly service 
24.11 	pension may provide a postretirement increase to retired members and ancillary benefit 
24.12 	recipients of the relief association if (1) the relief association adopts an appropriate bylaw 
24.13 	amendment; and (2) the bylaw amendment is approved by the municipality pursuant to 
24.14 	subdivision 10 and section 69.773, subdivision 6. The postretirement increase shall be
24.15 	is applicable only to retired members and ancillary benefit recipients receiving a service 
24.16 	pension or ancillary benefit as of the effective date of the bylaw amendment. The authority 
24.17 	to provide a postretirement increase to retired members and ancillary benefit recipients 
24.18 	of a relief association contained in this subdivision shall supersedesupersedes any prior 
24.19 	special law authorization relating to the provision of postretirement increases.

24.20 	Sec. 26. Minnesota Statutes 2008, section 424A.02, subdivision 9b, is amended to read:
24.21 		Subd. 9b.Repayment of service pension in certain instances. If a retired 
24.22 	volunteer firefighter does not permanently separate from active firefighting service as 
24.23 	required by subdivision 1 and section 424A.001, subdivision 9, by resuming active service 
24.24 	as a firefighter in the same volunteer fire department or as a person in charge of firefighters 
24.25 	in the same volunteer fire department, no additional service pension amount is payable 
24.26 	to the person, no additional service is creditable to the person, and the person shallmust 
24.27 	repay to the defined benefit relief association any previously received service pension.

24.28 	Sec. 27. Minnesota Statutes 2008, section 424A.02, subdivision 10, is amended to read:
24.29 		Subd. 10.Local approval of bylaw amendments; filing requirements. (a) Each 
24.30 	defined benefit relief association to which this section applies shallmust file a revised 
24.31 	copy of its governing bylaws with the state auditor upon the adoption of any amendment 
24.32 	to its governing bylaws by the relief association or upon the approval of any amendment 
24.33 	to its governing bylaws granted by the governing body of each municipality served by the 
25.1 	fire department to which the relief association is directly associated. Failure of the relief 
25.2 	association to file a copy of the bylaws or any bylaw amendments with the state auditor 
25.3 	shall disqualifydisqualifies the municipality from the distribution of any future fire state 
25.4 	aid until this filing requirement has been completed.
25.5 	(b) If the special fund of the relief association does not have a surplus over full 
25.6 	funding pursuant tounder section 69.772, subdivision 3, clause (2), subclause (e), or 
25.7 	69.773, subdivision 4, and if the municipality is required to provide financial support to 
25.8 	the special fund of the relief association pursuant tounder section 69.772 or 69.773, no 
25.9 	bylaw amendment which would affect the amount of, the manner of payment of, or the 
25.10 	conditions for qualification for service pensions or ancillary benefits or disbursements 
25.11 	other than administrative expenses authorized pursuant tounder section 69.80 payable 
25.12 	from the special fund of the relief association shall beis effective until it has been ratified 
25.13 	by the governing body or bodies of the appropriate municipalities. If the municipality is 
25.14 	not required to provide financial support to the special fund pursuant tounder this section, 
25.15 	the relief association may adopt or amend without municipal ratification its articles 
25.16 	of incorporation or bylaws which increase or otherwise affect the service pensions or 
25.17 	ancillary benefits payable from the special fund so long as the changes do not cause the 
25.18 	amount of the resulting increase in the accrued liability of the special fund to exceed 90 
25.19 	percent of the amount of the prior surplus over full funding and the changes do not result 
25.20 	in the financial requirements of the special fund exceeding the expected amount of the 
25.21 	futuresubsequent calendar year's fire state aid to be received by the relief association.
25.22 	(c) If the relief association pays only a lump-sum pension, the financial requirements 
25.23 	are to be determined by the board of trustees following the preparation of an estimate 
25.24 	of the expected increase in the accrued liability and annual accruing liability of the 
25.25 	relief association attributable to the change. If the relief association pays a monthly 
25.26 	benefit service pension, the financial requirements are to be determined by the board of 
25.27 	trustees following either an updated actuarial valuation including the proposed change 
25.28 	or an estimate of the expected actuarial impact of the proposed change prepared by the 
25.29 	actuary of the relief association. If a relief association adopts or amends its articles of 
25.30 	incorporation or bylaws without municipal ratification pursuant tounder this subdivision, 
25.31 	and, subsequent to the amendment or adoption, the financial requirements of the special 
25.32 	fund pursuant tounder this section are such so as to require financial support from the 
25.33 	municipality, the provision which was implemented without municipal ratification shallis 
25.34 	no longer be effective without municipal ratification, and any service pensions or ancillary 
25.35 	benefits payable after that date shallmust be paid only in accordance with the articles of 
25.36 	incorporation or bylaws as amended or adopted with municipal ratification.

26.1 	Sec. 28. Minnesota Statutes 2008, section 424A.02, subdivision 12, is amended to read:
26.2 		Subd. 12.Transfer of service credit to new district. Notwithstanding the 
26.3 	requirements of subdivision 1 or any other law, a member of a fire department which is 
26.4 	disbanded upon formation of a fire district to serve substantially the same geographic 
26.5 	area, who serves as an active firefighter with the new district fire department, and is a 
26.6 	member of the district firefighters' defined benefit relief association shall beis entitled 
26.7 	to a nonforfeitable service pension from the new relief association upon completion of 
26.8 	a combined total of 20 years active service in the disbanded and the new departments. 
26.9 	The amount of the service pension shall beis based upon years of service in the new 
26.10 	department only, and shallmust be in an amount equal to the accrued liability for the 
26.11 	appropriate years of service calculated in accordance with section 69.772, subdivision 2.

26.12 	Sec. 29. Minnesota Statutes 2008, section 424A.02, subdivision 13, is amended to read:
26.13 		Subd. 13.Combined service pensions. (a) If the articles of incorporation or bylaws 
26.14 	of the defined benefit relief associations so provide, a volunteer firefighter with credit for 
26.15 	service as an active firefighter in more than one defined benefit volunteer firefighters relief 
26.16 	association is entitled, when the applicable requirements of paragraph (b) are met and 
26.17 	when otherwise qualified, to a prorated service credit from each relief association.
26.18 	(b) A volunteer firefighter receiving a prorated service pension under this subdivision 
26.19 	must have a total amount of service credit of ten years or more, if the bylaws of every 
26.20 	affected relief association doesdo not requirespecify only a five-year service vesting 
26.21 	requirement, or five years or more, if the bylaws of every affected relief association 
26.22 	requiresrequire only a five-year service vesting requirement, as a member of two or more 
26.23 	relief associations otherwise qualified. The member must have one year or more of service 
26.24 	credit in each relief association. The prorated service pension must be based on the service 
26.25 	pension amount in effect for the relief association on the date on which active volunteer 
26.26 	firefighting services covered by that relief association terminate. To receive a service 
26.27 	pension under this subdivision, the firefighter must become a member of the second or 
26.28 	succeeding association and must give notice of membership to the prior association within 
26.29 	two years of the date of termination of active service with the prior association. The notice 
26.30 	must be attested to by the second or subsequent relief association secretary.

26.31 	Sec. 30. Minnesota Statutes 2008, section 424A.021, is amended to read:
26.32 	424A.021 CREDIT FOR BREAK IN SERVICE TO PROVIDE UNIFORMED 
26.33 	SERVICE.
27.1 		Subdivision 1.Authorization. Subject to restrictions stated in this section, a 
27.2 	volunteer firefighter who is absent from firefighting service due to service in the uniformed 
27.3 	services, as defined in United States Code, title 38, section 4303(13), may obtain service 
27.4 	credit if the relief association is a defined benefit plan or an allocation of any fire state 
27.5 	aid, any municipal contributions, and any investment return received by the relief 
27.6 	association as though the person was an active member if the relief association is a defined 
27.7 	contribution plan for the period of the uniformed service, not to exceed five years, unless a 
27.8 	longer period is required under United States Code, title 38, section 4312.
27.9 		Subd. 2.Limitations. (a) To be eligible for service credit or an investment return
27.10 	allocation as though an active member under this section, the volunteer firefighter must 
27.11 	return to firefighting service with coverage by the same relief association or by the 
27.12 	successor to that relief association upon discharge from service in the uniformed service 
27.13 	within the time frame required in United States Code, title 38, section 4312(e).
27.14 	(b) Service credit or an investment return allocation as though an active member is 
27.15 	not authorized if the firefighter separates from uniformed service with a dishonorable or 
27.16 	bad conduct discharge or under other than honorable conditions.
27.17 	(c) Service credit or an investment return allocation as though an active member 
27.18 	is not authorized if the firefighter fails to provide notice to the fire department that the 
27.19 	individual is leaving to provide service in the uniformed service, unless it is not feasible to 
27.20 	provide that notice due to the emergency nature of the situation.

27.21 	Sec. 31. Minnesota Statutes 2008, section 424A.03, is amended to read:
27.22 	424A.03 UNIFORMITY OF VOLUNTEER FIREFIGHTER SERVICE 
27.23 	PENSION AND RETIREMENT BENEFITS.
27.24 		Subdivision 1.Limitation on nonuniformity of pensions. Every partially salaried 
27.25 	and partially volunteer firefighters' relief association shallmust provide service pensions 
27.26 	to volunteer firefighter members based on the years of service of the members not on 
27.27 	the compensation paid to the members for firefighting services. Each relief association 
27.28 	shallmust provide service pensions to salaried members as set forth in chapter 424 and 
27.29 	applicable special laws.
27.30 		Subd. 2.Penalties for violations. AnyA municipality which has a fire department 
27.31 	to whichassociated with a relief association which violates the provisions of subdivision 
27.32 	1 is directly associated or which contracts with an independent nonprofit firefighting 
27.33 	corporation of whichassociated with a relief association which violates the provisions 
27.34 	of subdivision 1 is a subsidiary shallmay not be included in the apportionment of fire 
27.35 	state aid by the commissioner of commerce to the applicable county auditor pursuant to
28.1 	under section 69.021, subdivision 6, and shallmay not be included in the apportionment 
28.2 	of fire state aid by the county auditor to the various municipalities pursuant tounder 
28.3 	section 69.021, subdivision 7.
28.4 		Subd. 3.Exception to application of limitation and penalty. The limitation 
28.5 	provided for in subdivision 1 shalldoes not apply to any relief association which prior to
28.6 	before January 1, 1957, had established a definite service pension formula for members 
28.7 	of the partially salaried and partially volunteer firefighters' relief association who are 
28.8 	regularly employed firefighters.

28.9 	Sec. 32. Minnesota Statutes 2008, section 424A.04, is amended to read:
28.10 	424A.04 VOLUNTEER RELIEF ASSOCIATIONS; BOARD OF TRUSTEES.
28.11 		Subdivision 1.Membership. (a) A relief association that is directly associated with 
28.12 	a municipal fire department must be managed by a board of trustees consisting of nine 
28.13 	members. Six trustees must be elected from the membership of the relief association and 
28.14 	three trustees must be drawn from the officials of the municipalities served by the fire 
28.15 	department to which the relief association is directly associated. The bylaws of a relief 
28.16 	association which provides a monthly benefit service pension may provide that one of 
28.17 	the six trustees elected from the relief association membership may be a retired member 
28.18 	receiving a monthly pension who is elected by the membership of the relief association. 
28.19 	The three municipal trustees must be one elected municipal official and one elected or 
28.20 	appointed municipal official who are designated as municipal representatives by the 
28.21 	municipal governing board annually and the chief of the municipal fire department.
28.22 	(b) A relief association that is a subsidiary of an independent nonprofit firefighting 
28.23 	corporation must be managed by a board of trustees consisting of nine members. Six 
28.24 	trustees must be elected from the membership of the relief association, two trustees must 
28.25 	be drawn from the officials of the municipalities served by the fire department to which 
28.26 	the relief association is directly associated, and one trustee shallmust be the fire chief 
28.27 	serving with the independent nonprofit firefighting corporation. The bylaws of a relief 
28.28 	association may provide that one of the six trustees elected from the relief association 
28.29 	membership may be a retired member receiving a monthly pension who is elected by the 
28.30 	membership of the relief association. The two municipal trustees must be elected or 
28.31 	appointed municipal officials, selected as follows:
28.32 	(1) if only one municipality contracts with the independent nonprofit firefighting 
28.33 	corporation, the municipal trustees must be two officials of the contracting municipality 
28.34 	who are designated annually by the governing body of the municipality; or
29.1 	(2) if two or more municipalities contract with the independent nonprofit corporation, 
29.2 	the municipal trustees must be one official from each of the two largest municipalities 
29.3 	in population who are designated annually by the governing bodies of the applicable 
29.4 	municipalities.
29.5 	(c) The municipal trustees for a relief association that is directly associated with a fire 
29.6 	department operated as or by a joint powers entity must be designated annually by the joint 
29.7 	powers board. The municipal trustees for a relief association that is directly associated 
29.8 	with a fire department service area township must be designated by the township board.
29.9 	(d) If a relief association lacks the municipal board members provided for in 
29.10 	paragraph (a), (b), or (c) because the fire department is not located in or associated with an 
29.11 	organized municipality, joint powers entity, or township, the municipal board members 
29.12 	must be appointed from the fire department service area by the board of commissioners 
29.13 	of the applicable county.
29.14 	(e) The term of thesethe appointed municipal board members is one year or until the 
29.15 	person's successor is qualified, whichever is later.
29.16 	(f) A municipal trustee under paragraph (a), (b), (c), or (d) has all the rights 
29.17 	and duties accorded to any other trustee, except the right to be an officer of the relief 
29.18 	association board of trustees.
29.19 	(g) A board must have at least three officers, who are a president, a secretary and a 
29.20 	treasurer. These officers must be elected from among the elected trustees by either the full 
29.21 	board of trustees or by the relief association membership, as specified in the bylaws. In 
29.22 	no event may any trustee hold more than one officer position at any one time. The terms 
29.23 	of the elected trustees and of the officers of the board must be specified in the bylaws of 
29.24 	the relief association, but may not exceed three years. If the term of the elected trustees 
29.25 	exceeds one year, the election of the various trustees elected from the membership must be 
29.26 	staggered on as equal a basis as is practicable.
29.27 		Subd. 2.Fiduciary duty. The board of trustees of a relief association shall 
29.28 	undertake their activities consistent with chapter 356A.
29.29 		Subd. 2a.Fiduciary responsibility. In the discharge of their respective duties, the 
29.30 	officers and trustees shall be held to the standard of care specified in section 11A.09. In 
29.31 	addition, the trustees shall act in accordance with chapter 356A. Each member of the 
29.32 	board is a fiduciary and shall undertake all fiduciary activities in accordance with the 
29.33 	standard of care of section 11A.09, and in a manner consistent with chapter 356A. No 
29.34 	fiduciary of a relief association shall cause a relief association to engage in a transaction if 
29.35 	the fiduciary knows or should know that the transaction constitutes one of the following 
29.36 	direct or indirect transactions:
30.1 	(1) sale or exchange or leasing of any real property between the relief association 
30.2 	and a board member;
30.3 	(2) lending of money or other extension of credit between the relief association and 
30.4 	a board member or member of the relief association;
30.5 	(3) furnishing of goods, services, or facilities between the relief association and a 
30.6 	board member; or
30.7 	(4) transfer to a board member, or use by or for the benefit of a board member, of any 
30.8 	assets of the relief association. A transfer of assets does not mean the payment of relief 
30.9 	association benefits or administrative expenses permitted by law.
30.10 		Subd. 3.Conditions on relief association consultants. (a) If a volunteer firefighter 
30.11 	relief association hiresemploys or contracts with a consultant to provide legal or financial 
30.12 	advice, the secretary of the relief association shall obtain and the consultant shall provide 
30.13 	to the secretary of the relief association a copy of the consultant's certificate of insurance.
30.14 	(b) A consultant is any person who is employed under contract to provide legal or 
30.15 	financial advice and who is or who represents to the volunteer firefighter relief association 
30.16 	that the person is:
30.17 	(1) an actuary;
30.18 	(2) a licensed public accountant or a certified public accountant;
30.19 	(3) an attorney;
30.20 	(4) an investment advisor or manager, or an investment counselor;
30.21 	(5) an investment advisor or manager selection consultant;
30.22 	(6) a pension benefit design advisor or consultant; or
30.23 	(7) any other financial consultant.

30.24 	Sec. 33. Minnesota Statutes 2008, section 424A.05, subdivision 1, is amended to read:
30.25 		Subdivision 1.Establishment of special fund. Every volunteer firefighters' relief 
30.26 	association shall establish and maintain a special fund within the relief association.

30.27 	Sec. 34. Minnesota Statutes 2008, section 424A.05, subdivision 2, is amended to read:
30.28 		Subd. 2.Special fund assets and revenues. The special fund shallmust be credited 
30.29 	with all fire state aid moneys received pursuant tounder sections 69.011 to 69.051, 
30.30 	all taxes levied by or other revenues received from the municipality pursuant tounder 
30.31 	sections 69.771 to 69.776 or any applicable special law requiring municipal support for 
30.32 	the relief association, any moneys or property donated, given, granted or devised by any 
30.33 	person which is specified for use for the support of the special fund and any interest or 
30.34 	investment return earned upon the assets of the special fund. The treasurer of the relief 
31.1 	association shall beis the custodian of the assets of the special fund and shallmust be the 
31.2 	recipient on behalf of the special fund of all revenues payable to the special fund. The 
31.3 	treasurer shall maintain adequate records documenting any transaction involving the assets 
31.4 	or the revenues of the special fund. These records and the bylaws of the relief association 
31.5 	shall beare public and shallmust be open for inspection by any member of the relief 
31.6 	association, any officer or employee of the state or of the municipality, or any member of 
31.7 	the public, at reasonable times and places.

31.8 	Sec. 35. Minnesota Statutes 2008, section 424A.05, subdivision 3, is amended to read:
31.9 		Subd. 3.Authorized disbursements from the special fund. (a) Disbursements 
31.10 	from the special fund aremay not permitted to be made for any purpose other than one of 
31.11 	the following:
31.12 	(1) for the payment of service pensions to retired members of the relief association if 
31.13 	authorized and paid under law and the bylaws governing the relief association;
31.14 	(2) for the payment of temporary or permanent disability benefits to disabled 
31.15 	members of the relief association if authorized and paid pursuant tounder law and 
31.16 	specified in amount in the bylaws governing the relief association;
31.17 	(3) for the payment of survivor benefits to surviving spouses and surviving children, 
31.18 	or if none, to designated beneficiaries, of deceased members of the relief association, and 
31.19 	if no survivors and if no designated beneficiary, for the payment of a death benefit to the 
31.20 	estate of the deceased active or deferred firefighter, if authorized by and paid pursuant to
31.21 	under law and specified in amount in the bylaws governing the relief association;
31.22 	(4) for the payment of the fees, dues and assessments to the Minnesota State Fire 
31.23 	Department Association, to the Minnesota Area Relief Association Coalition, and to 
31.24 	the state Volunteer Firefighters Benefit Association in order to entitle relief association 
31.25 	members to membership in and the benefits of these associations or organizations; and
31.26 	(5) for the payment of administrative expenses of the relief association as authorized 
31.27 	under section 69.80. 
31.28 	(b) For purposes of this chapter, a designated beneficiary must be a natural person.

31.29 	Sec. 36. Minnesota Statutes 2008, section 424A.05, subdivision 4, is amended to read:
31.30 		Subd. 4.Investments of assets of the special fund. The assets of the special fund 
31.31 	shallmust be invested only in securities authorized by section 69.775.

31.32 	Sec. 37. Minnesota Statutes 2008, section 424A.06, is amended to read:
31.33 	424A.06 RELIEF ASSOCIATION GENERAL FUND.
32.1 		Subdivision 1.Establishment of general fund. AnyA volunteer firefighters' relief 
32.2 	association may establish and maintain a general fund within the relief association.
32.3 		Subd. 2.General fund assets and revenues. To the general fund, if established, 
32.4 	shallmust be credited all moneys received from dues, fines, initiation fees, entertainment 
32.5 	revenues and any moneys or property donated, given, granted or devised by any person, 
32.6 	for unspecified uses. The treasurer of the relief association shall beis the custodian of the 
32.7 	assets of the general fund and shallmust be the recipient on behalf of the general fund of 
32.8 	all revenues payable to the general fund. The treasurer shall maintain adequate records 
32.9 	documenting any transaction involving the assets or the revenues of the general fund. 
32.10 	These records shallmust be open for inspection by any member of the relief association 
32.11 	at reasonable times and places.
32.12 		Subd. 3.Authorized disbursements from the general fund. Disbursements from 
32.13 	the general fund may be made for any purpose that is authorized by either the articles of 
32.14 	incorporation or bylaws of the relief association.
32.15 		Subd. 4.Investment of assets of the general fund. The assets of the general 
32.16 	fund may be invested in any securities that are authorized by the bylaws of the relief 
32.17 	association and may be certified for investment by the State Board of Investment in fixed 
32.18 	income pools or in a separately managed account at the discretion of the State Board of 
32.19 	Investment as provided in section 11A.14.

32.20 	Sec. 38. Minnesota Statutes 2008, section 424A.07, is amended to read:
32.21 	424A.07 NONPROFIT FIREFIGHTING CORPORATIONS; 
32.22 	ESTABLISHMENT OF RELIEF ASSOCIATIONS.
32.23 	Prior toBefore paying any service pensions or retirement benefits pursuant to
32.24 	under section 424A.02 or before becoming entitled to receive any amounts of fire state 
32.25 	aid upon transmittal from a contracting municipality pursuant tounder section 69.031, 
32.26 	subdivision 5, a nonprofit firefighting corporation shall establish a volunteer firefighters' 
32.27 	relief association governed by this chapter.

32.28 	Sec. 39. Minnesota Statutes 2008, section 424A.08, is amended to read:
32.29 	424A.08 MUNICIPALITY WITHOUT RELIEF ASSOCIATION; 
32.30 	AUTHORIZED DISBURSEMENTS.
32.31 	Any qualified municipality which is entitled to receive fire state aid but which has 
32.32 	no volunteer firefighters' relief association directly associated with its fire department 
32.33 	shall deposit the fire state aid in a special account established for that purpose in the 
33.1 	municipal treasury. Disbursement from the special account shallmay not be made for 
33.2 	any purpose except:
33.3 	(1) payment of the fees, dues and assessments to the Minnesota State Fire 
33.4 	Department Association and to the state Volunteer Firefighters' Benefit Association in 
33.5 	order to entitle its firefighters to membership in and the benefits of these state associations;
33.6 	(2) payment of the cost of purchasing and maintaining needed equipment for the 
33.7 	fire department; and
33.8 	(3) payment of the cost forof construction, acquisition, repair andor maintenance of 
33.9 	buildings or other premises to house the equipment of the fire department.

33.10 	Sec. 40. Minnesota Statutes 2008, section 424A.10, subdivision 1, is amended to read:
33.11 		Subdivision 1. Definitions. For purposes of this section: 
33.12 	(1) "qualified recipient" means an individual who receives a lump-sum distribution 
33.13 	of pension or retirement benefits from a volunteer firefighters' relief association for service 
33.14 	that the individual has performed as a volunteer firefighter;
33.15 	(2) "survivor of a deceased active or deferred volunteer firefighter" means the legally 
33.16 	married spouse of a deceased volunteer firefighter, or, if none, the surviving minor child or 
33.17 	minor children of a deceased volunteer firefighter; 
33.18 	(3) "active volunteer firefighter" means a person who regularly renders fire 
33.19 	suppression service for a municipal fire department or an independent nonprofit firefighting 
33.20 	corporation, who has met the statutory and other requirements for relief association 
33.21 	membership, and who has been a fully qualified member of the relief association for 
33.22 	at least one month; and
33.23 	(4) "deferred volunteer firefighter" means a former active volunteer firefighter who 
33.24 	terminated active firefighting service, has sufficient service credit from the applicable 
33.25 	relief association to be entitled to a service pension, but has not applied for or has not 
33.26 	received the service pension.

33.27 	Sec. 41. Minnesota Statutes 2008, section 424A.10, subdivision 2, is amended to read:
33.28 		Subd. 2.Payment of supplemental benefit. (a) Upon the payment by a volunteer 
33.29 	firefighters' relief association of a lump-sum distribution to a qualified recipient, the 
33.30 	association must pay a supplemental benefit to the qualified recipient. Notwithstanding 
33.31 	any law to the contrary, the relief association must pay the supplemental benefit out of 
33.32 	its special fund. The amount of This benefit equalsis an amount equal to ten percent of 
33.33 	the regular lump-sum distribution that is paid on the basis of the recipient's service as 
33.34 	a volunteer firefighter. In no case may the amount of the supplemental benefit exceed 
34.1 	$1,000. A supplemental benefit under this paragraph may not be paid to a survivor of a 
34.2 	deceased active or deferred volunteer firefighter in that capacity.
34.3 	(b) Upon the payment by a relief association of a lump-sum survivor benefit or 
34.4 	funeral benefit to a survivor of a deceased active volunteer firefighter or of a deceased 
34.5 	deferred volunteer firefighter, the association may pay a supplemental survivor benefit 
34.6 	to the survivor of the deceased active or deferred volunteer firefighter from the special 
34.7 	fund of the relief association if its articles of incorporation or bylaws so provide. The 
34.8 	amount of the supplemental survivor benefit is 20 percent of the survivor benefit or funeral 
34.9 	benefit, but not to exceed $2,000.
34.10 	(c) An individual may receive a supplemental benefit under paragraph (a) or under 
34.11 	paragraph (b), but not under both paragraphs with respect to one lump-sum volunteer 
34.12 	firefighter benefit.

34.13 	Sec. 42. Minnesota Statutes 2008, section 424A.10, subdivision 3, is amended to read:
34.14 		Subd. 3. State reimbursement. (a) Each year, to be eligible for state reimbursement 
34.15 	of the amount of supplemental benefits paid under subdivision 2 during the preceding 
34.16 	calendar year, the volunteer firefighters' relief association must apply to the commissioner 
34.17 	of revenue by February 15. By March 15, the commissioner shall reimburse the relief 
34.18 	association for the amount of the supplemental benefits paid by the relief association to 
34.19 	qualified recipients and to survivors of deceased active or deferred volunteer firefighters. 
34.20 	(b) The commissioner of revenue shall prescribe the form of and supporting 
34.21 	information that must be supplied as part of the application for state reimbursement. 
34.22 	The commissioner of revenue shall reimburse the relief association by paying the 
34.23 	reimbursement amount to the treasurer of the municipality where the association is located. 
34.24 	Within 30 days after receipt, the municipal treasurer shall transmit the state reimbursement 
34.25 	to the treasurer of the association if the association has filed a financial report with the 
34.26 	municipality. If the relief association has not filed a financial report with the municipality, 
34.27 	the municipal treasurer shall delay transmission of the reimbursement payment to the 
34.28 	association until the complete financial report is filed. If the association has dissolved or 
34.29 	has been removed as a trustee of state aid, the treasurer shall deposit the money in a 
34.30 	special account in the municipal treasury, and the money may be disbursed only for the 
34.31 	purposes and in the manner provided in section 424A.08. When paid to the association, 
34.32 	the reimbursement payment must be deposited in the special fund of the relief association. 
34.33 	(c) A sum sufficient to make the payments is appropriated from the general fund 
34.34 	to the commissioner of revenue. 

35.1 	Sec. 43. Minnesota Statutes 2008, section 424A.10, subdivision 4, is amended to read:
35.2 		Subd. 4.In lieu of income tax exclusion. (a) The supplemental benefit provided 
35.3 	by this section is in lieu of the state income tax exclusion for lump-sum distributions of 
35.4 	retirement benefits paid to volunteer firefighters. 
35.5 	(b) If the law is modified to exclude or exempt volunteer firefighters' lump-sum 
35.6 	distributions from state income taxation, the supplemental benefits under this section 
35.7 	mayare no longer be paidpayable, beginning with the first calendar year in which the 
35.8 	exclusion or exemption is effective. This subdivision does not apply to exemption of all or 
35.9 	part of a lump-sum distribution under section 290.032 or 290.0802. 

35.10 	Sec. 44. Minnesota Statutes 2008, section 424A.10, subdivision 5, is amended to read:
35.11 		Subd. 5.Retroactive reimbursement in certain instances.  A supplemental 
35.12 	survivor or funeral benefit may be paid by a relief association for the death of an active 
35.13 	volunteer firefighter or of a deferred volunteer firefighter that occurred on or after August 
35.14 	1, 2005, if the relief association articles of incorporation or bylaws so provide for a 
35.15 	supplemental survivor benefit and provide for retroactivity.

35.16 	Sec. 45. Minnesota Statutes 2008, section 424B.10, is amended by adding a 
35.17 	subdivision to read:
35.18 		Subd. 1a.Applicability. This section applies when all of the volunteer firefighters' 
35.19 	relief associations involved in the consolidation are defined benefit relief associations as 
35.20 	defined in section 424A.001, subdivision 1b.

35.21 	Sec. 46. Minnesota Statutes 2008, section 424B.10, is amended by adding a 
35.22 	subdivision to read:
35.23 		Subd. 1b.Benefits. (a) The successor relief association following the consolidation 
35.24 	of two or more defined benefit relief associations must be a defined benefit relief 
35.25 	association.
35.26 	(b) Notwithstanding any provision of section 424A.02, subdivision 3, to the contrary, 
35.27 	the initial service pension amount of the subsequent defined benefit relief association as 
35.28 	of the effective date of consolidation is either the service pension amount specified in 
35.29 	clause (1) or the service pension amounts specified in clause (2), as provided for in the 
35.30 	consolidated relief association's articles of incorporation or bylaws:
35.31 	(1) the highest dollar amount service pension amount of any prior volunteer 
35.32 	firefighters relief association in effect immediately before the consolidation initiation if the 
35.33 	pension amount was implemented consistent with section 424A.02; or
36.1 	(2) for service rendered by each individual volunteer firefighter before consolidation, 
36.2 	the service pension amount under the consolidating volunteer firefighters relief association 
36.3 	that the firefighter belonged to immediately before the consolidation if the pension amount 
36.4 	was implemented consistent with section 424A.02 and for service rendered after the 
36.5 	effective date of the consolidation, the highest dollar amount service pension of any of the 
36.6 	consolidating volunteer firefighters relief associations in effect immediately before the 
36.7 	consolidation if the pension amount was implemented consistent with section 424A.02.
36.8 	(c) Any increase in the service pension amount beyond the amount implemented 
36.9 	under paragraph (a) must conform with the requirements and limitations of sections 
36.10 	69.771 to 69.775 and section 424A.02.

36.11 	Sec. 47. Minnesota Statutes 2008, section 424B.10, subdivision 2, is amended to read:
36.12 		Subd. 2.Funding. (a) Unless the applicable municipalities agree in writing to 
36.13 	allocate the minimum municipal obligation in a different manner, the minimum municipal 
36.14 	obligation under section 69.772 or 69.773, whichever applies, must be allocated between 
36.15 	the applicable municipalities in proportion to their fire state aid.
36.16 	(b) If any applicable municipality fails to meet its portion of the minimum municipal 
36.17 	obligation to the subsequent relief association, all other applicable municipalities are 
36.18 	jointly obligated to provide the required funding upon certification by the relief association 
36.19 	secretary. An applicable municipality that pays the minimum municipal obligation 
36.20 	amount for another applicable municipality, the municipality may collect thethat payment 
36.21 	amount, plus a 25 percent surcharge, from the responsible applicable municipality by any 
36.22 	available means, including a deduction from any state aid or payment amount payable 
36.23 	to the responsible municipality upon certification of the necessary information to the 
36.24 	commissioner of finance.

36.25 	Sec. 48. [424B.11] CONSOLIDATING DEFINED CONTRIBUTION RELIEF 
36.26 	ASSOCIATIONS; INDIVIDUAL ACCOUNTS; FUNDING.
36.27 		Subdivision 1.Applicability. This section applies when all of the volunteer 
36.28 	firefighters' relief associations involved in the consolidation are defined contribution relief 
36.29 	associations as defined in section 424A.001, subdivision 1c.
36.30 		Subd. 2.Individual accounts. The successor relief association following the 
36.31 	consolidation of two or more defined contribution relief associations must be a defined 
36.32 	contribution relief association and the successor relief association board shall establish 
36.33 	individual accounts for every active member, deferred member, or retired member 
36.34 	receiving installment payments with that status as of the consolidation date. To each 
37.1 	individual account the successor relief association must credit the amount to the credit 
37.2 	of each person by a predecessor relief association as of the date of consolidation plus a 
37.3 	proportional share, based on account value, of any subsequent net revenue during the 
37.4 	consolidation process.
37.5 		Subd. 3.Funding. Unless the articles of incorporation or bylaws of the successor 
37.6 	relief association specify that municipal contributions are wholly voluntary or unless the 
37.7 	municipalities associated with the consolidating defined contribution relief associations 
37.8 	agree in writing to a different municipal support arrangement, each municipality must 
37.9 	continue to provide the same amount of municipal support to the successor relief 
37.10 	association as the municipality provided to the applicable predecessor relief association in 
37.11 	the calendar year immediately prior to the calendar year in which the consolidation occurs.

37.12 	Sec. 49. [424B.12] MIXED CONSOLIDATING RELIEF ASSOCIATIONS; 
37.13 	BENEFIT PLAN; FUNDING.
37.14 		Subdivision 1.Applicability. This section applies where one or more of the 
37.15 	volunteer firefighters' relief associations involved in the consolidation are defined benefit 
37.16 	relief associations as defined in section 424A.001, subdivision 1b, and one or more of 
37.17 	the volunteer firefighters' relief associations involved in the consolidation are defined 
37.18 	contribution relief associations as defined in section 424A.001, subdivision 1c.
37.19 		Subd. 2.Benefit plan. The articles of incorporation or bylaws of the successor 
37.20 	relief association must specify whether the relief association is a defined benefit relief 
37.21 	association or whether the relief association is a defined contribution relief association. If 
37.22 	the successor relief association is a defined benefit relief association, the relief association 
37.23 	benefits must comply with sections 424A.02 and 424B.11, subdivision 1a. If the successor 
37.24 	relief association is a defined contribution relief association, the relief association must 
37.25 	comply with sections 424A.016 and 424B.12, subdivision 2.
37.26 		Subd. 3.Funding. If the successor relief association is a defined benefit relief 
37.27 	association, the relief association funding is governed by section 424B.11, subdivision 2. 
37.28 	If the successor relief association is a defined contribution relief association, the relief 
37.29 	association funding is governed by section 424B.12, subdivision 3.

37.30 	Sec. 50.  REPEALER.
 37.31 		Subdivision 1.Repealed for recodification. Minnesota Statutes 2008, sections 
37.32 	424A.001, subdivision 7; 424A.02, subdivisions 4, 6, 8a, and 8b; and 424B.10, subdivision 
37.33 	1, are repealed.
38.1 		Subd. 2.Repealed as obsolete. Minnesota Statutes 2008, section 424A.09, is 
38.2 	repealed.

38.3 	Sec. 51. EFFECTIVE DATE.
 38.4 	(a) Except as specified in paragraphs (b) and (c), sections 1 to 21, 23 to 31, and 36 
38.5 	to 50 are effective July 1, 2009.
38.6 	(b) The reduction in the number of deferred service pension interest options 
38.7 	contained in section 22 is effective January 1, 2010.
38.8 	(c) Sections 32 to 35 are effective retroactively from July 1, 2008.

38.9 	ARTICLE 2
38.10 	CONFORMING CHANGES

38.11 	Section 1. Minnesota Statutes 2008, section 69.771, subdivision 3, is amended to read:
38.12 		Subd. 3.Remedy for noncompliance; determination. (a) A municipality in which 
38.13 	there exists a firefighters' relief association as specified in subdivision 1 which does not 
38.14 	comply with the applicable provisions of sections 69.771 to 69.776 or the provisions of 
38.15 	any applicable special law relating to the funding or financing of the association does 
38.16 	not qualify initially to receive, and is not entitled subsequently to retain, fire state aid 
38.17 	under sections 69.011 to 69.051 until the reason for the disqualification specified by the 
38.18 	state auditor is remedied, whereupon the municipality or relief association, if otherwise 
38.19 	qualified, is entitled to again receive fire state aid for the year occurring immediately 
38.20 	subsequent to the year in which the disqualification is remedied.
38.21 	(b) The state auditor shall determine if a municipality to which a firefighters' relief 
38.22 	association is directly associated or a firefighters' relief association fails to comply with 
38.23 	the provisions of sections 69.771 to 69.776 or the funding or financing provisions of any 
38.24 	applicable special law based upon the information contained in the annual financial report 
38.25 	of the firefighters' relief association required under section 69.051, the actuarial valuation 
38.26 	of the relief association, if applicable, the relief association officers' financial requirements 
38.27 	of the relief association and minimum municipal obligation determination documentation 
38.28 	under section 69.772, subdivisions 3 and 4; 69.773, subdivisions 4 and 5; or 69.774, 
38.29 	subdivision 2, if requested to be filed by the state auditor, the applicable municipal or 
38.30 	nonprofit firefighting corporation budget, if requested to be filed by the state auditor, and 
38.31 	any other relevant documents or reports obtained by the state auditor.
38.32 	(c) The municipality or nonprofit firefighting corporation and the associated relief 
38.33 	association are not eligible to receive or to retain fire state aid if:
39.1 	(1) the relief association fails to prepare or to file the financial report or financial 
39.2 	statement under section 69.051;
39.3 	(2) the relief association treasurer is not bonded in the manner and in the amount 
39.4 	required by section 69.051, subdivision 2;
39.5 	(3) the relief association officers fail to determine or improperly determine the 
39.6 	accrued liability and the annual accruing liability of the relief association under section 
39.7 	69.772, subdivisions 2, 2a, and 3, paragraph (c), clause (2), if applicable;
39.8 	(4) if applicable, the relief association officers fail to obtain and file a required 
39.9 	actuarial valuation or the officers file an actuarial valuation that does not contain the 
39.10 	special fund actuarial liability calculated under the entry age normal actuarial cost 
39.11 	method, the special fund current assets, the special fund unfunded actuarial accrued 
39.12 	liability, the special fund normal cost under the entry age normal actuarial cost method, 
39.13 	the amortization requirement for the special fund unfunded actuarial accrued liability 
39.14 	by the applicable target date, a summary of the applicable benefit plan, a summary of 
39.15 	the membership of the relief association, a summary of the actuarial assumptions used 
39.16 	in preparing the valuation, and a signed statement by the actuary attesting to its results 
39.17 	and certifying to the qualifications of the actuary as an approved actuary under section 
39.18 	356.215, subdivision 1, paragraph (c);
39.19 	(5) the municipality failed to provide a municipal contribution, or the nonprofit 
39.20 	firefighting corporation failed to provide a corporate contribution, in the amount equal 
39.21 	to the minimum municipal obligation if the relief association is governed under section 
39.22 	69.772, or the amount necessary, when added to the fire state aid actually received 
39.23 	in the plan year in question, to at least equal in total the calculated annual financial 
39.24 	requirements of the special fund of the relief association if the relief association is 
39.25 	governed under section 69.773, and, if the municipal or corporate contribution is deficient, 
39.26 	the municipality failed to include the minimum municipal obligation certified under 
39.27 	section 69.772, subdivision 3, or 69.773, subdivision 5, in its budget and tax levy or the 
39.28 	nonprofit firefighting corporation failed to include the minimum corporate obligation 
39.29 	certified under section 69.774, subdivision 2, in the corporate budget;
39.30 	(6) the defined benefit relief association did not receive municipal ratification for 
39.31 	the most recent plan amendment when municipal ratification was required under section 
39.32 	69.772, subdivision 6; 69.773, subdivision 6; or 424A.02, subdivision 10;
39.33 	(7) the relief association invested special fund assets in an investment security 
39.34 	that is not authorized under section 69.775;
40.1 	(8) the relief association had an administrative expense that is not authorized under 
40.2 	section 69.80 or 424A.05, subdivision 3, or the municipality had an expenditure that 
40.3 	is not authorized under section 424A.08;
40.4 	(9) the relief association officers fail to provide a complete and accurate public 
40.5 	pension plan investment portfolio and performance disclosure under section 356.219;
40.6 	(10) the relief association fails to obtain the acknowledgment from a broker of the 
40.7 	statement of investment restrictions under section 356A.06, subdivision 8b;
40.8 	(11) the relief association officers permitted to occur a prohibited transaction under 
40.9 	section 356A.06, subdivision 9, or 424A.001 424A.04, subdivision 7 2a, or failed to 
40.10 	undertake correction of a prohibited transaction that did occur; or
40.11 	(12) the relief association pays a defined benefit service pension in an amount 
40.12 	that is in excess of the applicable service pension maximum under section 424A.02, 
40.13 	subdivision 3.

40.14 	EFFECTIVE DATE. This section is effective July 1, 2009, if article 1 is also 
40.15 	enacted.

40.16 	Sec. 2. Minnesota Statutes 2008, section 424B.21, is amended to read:
40.17 	424B.21 ANNUITY PURCHASES UPON DISSOLUTION.
40.18 	The board of trustees of a volunteer firefighters relief association that is scheduled 
40.19 	for dissolution may purchase annuity contracts under section 424A.02 424A.015, 
40.20 	subdivision 8a 3, instead of transferring special fund assets to a municipal trust fund 
40.21 	under section 424B.20, subdivision 4. Payment of an annuity for which a contract is 
40.22 	purchased may not commence before the retirement age specified in the relief association 
40.23 	bylaws and in compliance with section 424A.016, subdivision 2, or 424A.02, subdivision 
40.24 	1. Legal title to the annuity contract transfers to the municipal trust fund under section 
40.25 	424B.20, subdivision 4.

40.26 	EFFECTIVE DATE. This section is effective July 1, 2009, if article 1 is also 
40.27 	enacted.

40.28 	ARTICLE 3
40.29 	VOLUNTEER FIREFIGHTER RELIEF ASSOCIATION
40.30 	GENERAL CHANGES

40.31 	Section 1. Minnesota Statutes 2008, section 69.031, subdivision 5, is amended to read:
40.32 		Subd. 5.Deposit of state aid. (a) The municipal treasurer shall, within 30 days 
40.33 	after receipt, transmit the fire state aid to the treasurer of the duly incorporated firefighters' 
41.1 	relief association if there is one organized and the association has filed a financial report 
41.2 	with the municipality. If the relief association has not filed a financial report with the 
41.3 	municipality, the municipal treasurer shall delay transmission of the fire state aid to the 
41.4 	relief association until the complete financial report is filed. If there is no relief association 
41.5 	organized, or if the association has dissolved, or has been removed as trustees of state aid, 
41.6 	then the treasurer of the municipality shall deposit the money in the municipal treasury 
41.7 	as provided for in section 424A.08 and the money may be disbursed only for the purposes 
41.8 	and in the manner set forth in that section 424A.08 or for the payment of the employer 
41.9 	contribution requirement with respect to firefighters covered by the public employees 
41.10 	police and fire retirement plan under section 353.65, subdivision 3.
41.11 	(b) The municipal treasurer, upon receipt of the police state aid, shall disburse the 
41.12 	police state aid in the following manner:
41.13 	(1) For a municipality in which a local police relief association exists and all peace 
41.14 	officers are members of the association, the total state aid must be transmitted to the 
41.15 	treasurer of the relief association within 30 days of the date of receipt, and the treasurer 
41.16 	of the relief association shall immediately deposit the total state aid in the special fund 
41.17 	of the relief association;
41.18 	(2) For a municipality in which police retirement coverage is provided by the public 
41.19 	employees police and fire fund and all peace officers are members of the fund, including 
41.20 	municipalities covered by section 353.665, the total state aid must be applied toward the 
41.21 	municipality's employer contribution to the public employees police and fire fund under 
41.22 	sections 353.65, subdivision 3, and 353.665, subdivision 8, paragraph (b), if applicable; or
41.23 	(3) For a municipality other than a city of the first class with a population of more 
41.24 	than 300,000 in which both a police relief association exists and police retirement 
41.25 	coverage is provided in part by the public employees police and fire fund, the municipality 
41.26 	may elect at its option to transmit the total state aid to the treasurer of the relief association 
41.27 	as provided in clause (1), to use the total state aid to apply toward the municipality's 
41.28 	employer contribution to the public employees police and fire fund subject to all the 
41.29 	provisions set forth in clause (2), or to allot the total state aid proportionately to be 
41.30 	transmitted to the police relief association as provided in this subdivision and to apply 
41.31 	toward the municipality's employer contribution to the public employees police and fire 
41.32 	fund subject to the provisions of clause (2) on the basis of the respective number of active 
41.33 	full-time peace officers, as defined in section 69.011, subdivision 1, clause (g).
41.34 	For a city of the first class with a population of more than 300,000, in addition, the 
41.35 	city may elect to allot the appropriate portion of the total police state aid to apply toward 
41.36 	the employer contribution of the city to the public employees police and fire fund based 
42.1 	on the covered salary of police officers covered by the fund each payroll period and to 
42.2 	transmit the balance to the police relief association; or
42.3 	(4) For a municipality in which police retirement coverage is provided in part by 
42.4 	the public employees police and fire fund and in part by a local police consolidation 
42.5 	account governed by chapter 353A and established before March 2, 1999, for which the 
42.6 	municipality declined merger under section 353.665, subdivision 1, or established after 
42.7 	March 1, 1999, the total police state aid must be applied towards the municipality's total 
42.8 	employer contribution to the public employees police and fire fund and to the local police 
42.9 	consolidation account under sections 353.65, subdivision 3, and 353A.09, subdivision 5.
42.10 	(c) The county treasurer, upon receipt of the police state aid for the county, shall 
42.11 	apply the total state aid toward the county's employer contribution to the public employees 
42.12 	police and fire fund under section 353.65, subdivision 3.
42.13 	(d) The designated Metropolitan Airports Commission official, upon receipt of the 
42.14 	police state aid for the Metropolitan Airports Commission, shall apply the total police 
42.15 	state aid first toward the commission's employer contribution for police officers to the 
42.16 	Minneapolis Employees Retirement Fund under section 422A.101, subdivision 2a, and, if 
42.17 	there is any amount of police state aid remaining, shall apply that remainder toward the 
42.18 	commission's employer contribution for police officers to the public employees police and 
42.19 	fire plan under section 353.65, subdivision 3.
42.20 	(e) The police state aid apportioned to the Departments of Public Safety and Natural 
42.21 	Resources under section 69.021, subdivision 7a, is appropriated to the commissioner of 
42.22 	finance for transfer to the funds and accounts from which the salaries of peace officers 
42.23 	certified under section 69.011, subdivision 2a, are paid. The commissioner of revenue 
42.24 	shall certify to the commissioners of public safety, natural resources, and finance the 
42.25 	amounts to be transferred from the appropriation for police state aid. The commissioners 
42.26 	of public safety and natural resources shall certify to the commissioner of finance the 
42.27 	amounts to be credited to each of the funds and accounts from which the peace officers 
42.28 	employed by their respective departments are paid. Each commissioner must allocate the 
42.29 	police state aid first for employer contributions for employees funded from the general 
42.30 	fund and then for employer contributions for employees funded from other funds. For 
42.31 	peace officers whose salaries are paid from the general fund, the amounts transferred from 
42.32 	the appropriation for police state aid must be canceled to the general fund.

42.33 	EFFECTIVE DATE. This section is effective July 1, 2009.

42.34 	Sec. 2. Minnesota Statutes 2008, section 69.772, subdivision 4, is amended to read:
43.1 		Subd. 4.Certification of financial requirements and minimum municipal 
43.2 	obligation; levy. (a) The officers of the relief association shall certify the financial 
43.3 	requirements of the special fund of the relief association and the minimum obligation of 
43.4 	the municipality with respect to the special fund of the relief association as determined 
43.5 	under subdivision 3 to the governing body of the municipality on or before August 1 of 
43.6 	each year. The financial requirements of the relief association and the minimum municipal 
43.7 	obligation must be included in the financial report or financial statement under section 
43.8 	69.051. The schedule forms related to the determination of the financial requirements 
43.9 	must be filed with the state auditor by March 31, annually, if the relief association is 
43.10 	required to file a financial statement under section 69.051, subdivision 1a, or by June 30, 
43.11 	annually, if the relief association is required to file a financial report and audit under 
43.12 	section 69.051, subdivision 1.
43.13 	(b) The municipality shall provide for at least the minimum obligation of the 
43.14 	municipality with respect to the special fund of the relief association by tax levy or from 
43.15 	any other source of public revenue.
43.16 	(c) The municipality may levy taxes for the payment of the minimum municipal 
43.17 	obligation without any limitation as to rate or amount and irrespective of any limitations 
43.18 	imposed by other provisions of law upon the rate or amount of taxation until the balance 
43.19 	of the special fund or any fund of the relief association has attained a specified level. In 
43.20 	addition, any taxes levied under this section must not cause the amount or rate of any other 
43.21 	taxes levied in that year or to be levied in a subsequent year by the municipality which are 
43.22 	subject to a limitation as to rate or amount to be reduced.
43.23 	(d) If the municipality does not include the full amount of the minimum municipal 
43.24 	obligations in its levy for any year, the officers of the relief association shall certify that 
43.25 	amount to the county auditor, who shall spread a levy in the amount of the certified 
43.26 	minimum municipal obligation on the taxable property of the municipality.
43.27 	(e) If the state auditor determines that a municipal contribution actually made in a 
43.28 	plan year was insufficient under section 69.771, subdivision 3, paragraph (c), clause (5), 
43.29 	the state auditor may request a copy of the certifications under this subdivision from the 
43.30 	relief association or from the city. The relief association or the city, whichever applies, 
43.31 	must provide the certifications within 14 days of the date of the request from the state 
43.32 	auditor.

43.33 	EFFECTIVE DATE. This section is effective July 1, 2009.

43.34 	Sec. 3. Minnesota Statutes 2008, section 69.772, subdivision 6, is amended to read:
44.1 		Subd. 6.Municipal ratification for plan amendments. If the special fund of the 
44.2 	relief association does not have a surplus over full funding pursuant to subdivision 3, 
44.3 	clause (2), subclause (e), or if the municipality is required to provide financial support 
44.4 	to the special fund of the relief association pursuant to this section, the adoption of 
44.5 	or any amendment to the articles of incorporation or bylaws of a relief association 
44.6 	which increases or otherwise affects the retirement coverage provided by or the service 
44.7 	pensions or retirement benefits payable from the special fund of any relief association 
44.8 	to which this section applies shall not be effective until it is ratified by the governing 
44.9 	body of the municipality in which the relief association is located and the officers of a 
44.10 	relief association shall not seek municipal ratification prior to preparing and certifying 
44.11 	an estimate of the expected increase in the accrued liability and annual accruing liability 
44.12 	of the relief association attributable to the amendment. If the special fund of the relief 
44.13 	association has a surplus over full funding pursuant to subdivision 3, clause (2), subclause 
44.14 	(e), and if the municipality is not required to provide financial support to the special fund 
44.15 	of the relief association pursuant to this section, the relief association may adopt or amend 
44.16 	its articles of incorporation or bylaws which increase or otherwise affect the retirement 
44.17 	coverage provided by or the service pensions or retirement benefits payable from the 
44.18 	special fund of the relief association which shall be effective without municipal ratification 
44.19 	so long as this does not cause the amount of the resulting increase in the accrued liability 
44.20 	of the special fund of the relief association to exceed 90 percent of the amount of the 
44.21 	prior surplus over full funding reported in the prior year and this does not result in the 
44.22 	financial requirements of the special fund of the relief association exceeding the expected 
44.23 	amount of the future fire state aid to be received by the relief association as determined 
44.24 	by the board of trustees following the preparation of an estimate of the expected increase 
44.25 	in the accrued liability and annual accruing liability of the relief association attributable 
44.26 	to the change. If a relief association adopts or amends its articles of incorporation or 
44.27 	bylaws without municipal ratification pursuant to this subdivision, and, subsequent to 
44.28 	the amendment or adoption, the financial requirements of the special fund of the relief 
44.29 	association pursuant to this section are such so as to require financial support from the 
44.30 	municipality, the provision which was implemented without municipal ratification shall no 
44.31 	longer be effective without municipal ratification and any service pensions or retirement 
44.32 	benefits payable after that date shall be paid only in accordance with the articles of 
44.33 	incorporation or bylaws as amended or adopted with municipal ratification.

44.34 	EFFECTIVE DATE. This section is effective July 1, 2009.

44.35 	Sec. 4. Minnesota Statutes 2008, section 69.773, subdivision 6, is amended to read:
45.1 		Subd. 6.Municipal ratification for plan amendments. If the special fund of the 
45.2 	relief association does not have a surplus over full funding pursuant to subdivision 4, or if 
45.3 	the municipality is required to provide financial support to the special fund of the relief 
45.4 	association pursuant to this section, the adoption of or any amendment to the articles of 
45.5 	incorporation or bylaws of a relief association which increases or otherwise affects the 
45.6 	retirement coverage provided by or the service pensions or retirement benefits payable 
45.7 	from the special fund of any relief association to which this section applies shall not 
45.8 	be effective until it is ratified by the governing body of the municipality in which the 
45.9 	relief association is located. If the special fund of the relief association has a surplus over 
45.10 	full funding pursuant to subdivision 4, and if the municipality is not required to provide 
45.11 	financial support to the special fund of the relief association pursuant to this section, 
45.12 	the relief association may adopt or amend its articles of incorporation or bylaws which 
45.13 	increase or otherwise affect the retirement coverage provided by or the service pensions or 
45.14 	retirement benefits payable from the special fund of the relief association which shall be 
45.15 	effective without municipal ratification so long as this does not cause the amount of the 
45.16 	resulting increase in the accrued liability of the special fund of the relief association to 
45.17 	exceed 90 percent of the amount of the prior surplus over full funding reported in the prior 
45.18 	year and this does not result in the financial requirements of the special fund of the relief 
45.19 	association exceeding the expected amount of the future fire state aid to be received by the 
45.20 	relief association as determined by the board of trustees following the preparation of an 
45.21 	updated actuarial valuation including the proposed change or an estimate of the expected 
45.22 	actuarial impact of the proposed change prepared by the actuary of the relief association. 
45.23 	If a relief association adopts or amends its articles of incorporation or bylaws without 
45.24 	municipal ratification pursuant to this subdivision, and, subsequent to the amendment or 
45.25 	adoption, the financial requirements of the special fund of the relief association pursuant to 
45.26 	this section are such so as to require financial support from the municipality, the provision 
45.27 	which was implemented without municipal ratification shall no longer be effective without 
45.28 	municipal ratification and any service pensions or retirement benefits payable after that 
45.29 	date shall be paid only in accordance with the articles of incorporation or bylaws as 
45.30 	amended or adopted with municipal ratification.

45.31 	EFFECTIVE DATE. This section is effective July 1, 2009.

45.32 	Sec. 5. Minnesota Statutes 2008, section 356.219, subdivision 3, is amended to read:
45.33 		Subd. 3.Content of reports. (a) The report required by subdivision 1 must include 
45.34 	a written statement of the investment policy. Following that initial report, subsequent 
45.35 	reports must include investment policy changes and the effective date of each policy 
46.1 	change rather than a complete statement of investment policy, unless the state auditor 
46.2 	requests submission of a complete current statement. The report must also include the 
46.3 	information required by the following paragraphs, as applicable.
46.4 	(b) If, after four years of reporting under this paragraph, the total portfolio time 
46.5 	weighted rate of return, net of all investment related costs and fees, provided by the public 
46.6 	pension plan differs by no more than 0.1 percent from the comparable return for the plan 
46.7 	calculated by the Office of the State Auditor, and if a public pension plan has a total 
46.8 	market value of $25,000,000 or more as of the beginning of the calendar year, and if the 
46.9 	public pension plan's annual audit is performed by the state auditor or by the legislative 
46.10 	auditor, the report required by subdivision 1 must include the market value of the total 
46.11 	portfolio and the market value of each asset class included in the pension fund as of the 
46.12 	beginning of the calendar year and as of the end of the calendar year. At the discretion of 
46.13 	the state auditor, the public pension plan may be required to submit the market value of the 
46.14 	total portfolio and the market value of each investment account, investment portfolio, or 
46.15 	asset class included in the pension fund for each month, and the amount and date of each 
46.16 	injection and withdrawal to the total portfolio and to each investment account, investment 
46.17 	portfolio, or asset class. If the market value of a public pension plan's fund drops below 
46.18 	$25,000,000 in a subsequent year, it must continue reporting under this paragraph for any 
46.19 	subsequent year in which the public pension plan is not fully invested as specified in 
46.20 	subdivision 1, paragraph (b), except that if the public pension plan's annual audit is not 
46.21 	performed by the state auditor or legislative auditor, paragraph (c) applies.
46.22 	(c) If paragraph (b) would apply if the annual audit were provided by the state 
46.23 	auditor or legislative auditor, the report required by subdivision 1 must include the market 
46.24 	value of the total portfolio and the market value of each asset class included in the pension 
46.25 	fund as of the beginning of the calendar year and for each month, and the amount and date 
46.26 	of each injection and withdrawal to the total portfolio and to each investment account, 
46.27 	investment portfolio, or asset class.
46.28 	(d) For public pension plans to which paragraph (b) or (c) applies, the report required 
46.29 	by subdivision 1 must also include a calculation of the total time-weighted rate of return 
46.30 	available from index-matching investments assuming the asset class performance targets 
46.31 	and target asset mix indicated in the written statement of investment policy. The provided 
46.32 	information must include a description of indices used in the analyses and an explanation 
46.33 	of why those indices are appropriate. This paragraph does not apply to any fully invested 
46.34 	plan, as defined by subdivision 1, paragraph (b). Reporting by the State Board of 
46.35 	Investment under this paragraph is limited to information on the Minnesota public pension 
46.36 	plans required to be invested by the State Board of Investment under section 11A.23. 
47.1 	(e) If a public pension plan has a total market value of less than $25,000,000 as of 
47.2 	the beginning of the calendar year and was never required to file under paragraph (b) or 
47.3 	(c), the report required by subdivision 1 must include the amount and date of each total 
47.4 	portfolio injection and withdrawal. In addition, the report must include the market value 
47.5 	of the total portfolio as of the beginning of the calendar year and for each quarter.
47.6 	(f) Any public pension plan reporting under paragraph (b) or (c) must include 
47.7 	computed time-weighted rates of return with the report, in addition to all other required 
47.8 	information, as applicable. The chief administrative officer of the public pension plan 
47.9 	submitting the returns must certify, on a form prescribed by the state auditor, that the 
47.10 	returns have been computed by the pension plan's investment performance consultant or 
47.11 	custodial bank. The chief administrative officer of the public pension plan submitting the 
47.12 	returns also must certify that the returns are net of all costs and fees, including investment 
47.13 	management fees, and that the procedures used to compute the returns are consistent 
47.14 	with Bank Administration Institute studies of investment performance measurement 
47.15 	and presentation standards set by the Certified Financial AnalystCFA Institute. If the 
47.16 	certifications required under this paragraph are not provided, the reporting requirements of 
47.17 	paragraph (c) apply.
47.18 	(g) For public pension plans reporting under paragraph (e), the public pension plan 
47.19 	must retain supporting information specifying the date and amount of each injection and 
47.20 	withdrawal to each investment account and investment portfolio. The public pension plan 
47.21 	must also retain the market value of each investment account and investment portfolio at 
47.22 	the beginning of the calendar year and for each quarter. Information that is required to be 
47.23 	collected and retained for any given year or years under this paragraph must be submitted 
47.24 	to the Office of the State Auditor if the Office of the State Auditor requests in writing that 
47.25 	the information be submitted by a public pension plan or plans, or be submitted by the 
47.26 	State Board of Investment for any plan or plans for which the State Board of Investment is 
47.27 	the investment authority under this section. If the state auditor requests information under 
47.28 	this subdivision, and the public plan fails to comply, the pension plan is subject to penalties 
47.29 	under subdivision 5, unless penalties are waived by the state auditor under that subdivision.

47.30 	EFFECTIVE DATE. This section is effective July 1, 2009.

47.31 	Sec. 6. Minnesota Statutes 2008, section 424A.01, subdivision 1, is amended to read:
47.32 		Subdivision 1.Minors. (a) It is unlawful for any municipality or independent 
47.33 	nonprofit firefighting corporation to employ a minor as a volunteer firefighter or to permit 
47.34 	a minor to serve in any capacity performing any firefighting duties with a volunteer fire 
47.35 	department, except for members of a youth, civic, or educational organization or program 
48.1 	who participate with uninterrupted adult supervision, as allowed by federal law and by 
48.2 	section 181A.04. Such organizations or programs include, but are not limited to, Boy 
48.3 	Scout Explorer programs or firefighting degree programs.
48.4 	(b) No volunteer firefighters' relief association associated with a municipality or an 
48.5 	independent nonprofit firefighting corporation may include as a relief association member 
48.6 	a minor serving as a volunteer firefighter.

48.7 	EFFECTIVE DATE. This section is effective July 1, 2009.

48.8 	Sec. 7. Minnesota Statutes 2008, section 424A.01, is amended by adding a subdivision 
48.9 	to read:
48.10 		Subd. 6.Return to active firefighting after break in service. (a) If a former active 
48.11 	firefighter who has separated from active service for at least 60 days resumes performing 
48.12 	active firefighting with the fire department associated with the relief association, if the 
48.13 	bylaws of the relief association so permit, the person may again become an active member 
48.14 	of the relief association.
48.15 	(b) A firefighter who returns to active relief association membership under paragraph 
48.16 	(a) may qualify for the receipt of a service pension from the relief association for the 
48.17 	resumption service period if the firefighter meets a minimum period of resumption service 
48.18 	specified in the relief association bylaws.
48.19 	(c) A firefighter who returns to active lump-sum relief association membership and 
48.20 	who qualifies for a service pension under paragraph (b) must have, upon a subsequent 
48.21 	cessation of duties, any service pension for the resumption service period calculated as 
48.22 	a separate benefit. If a lump-sum service pension had been paid to the firefighter upon 
48.23 	the firefighter's previous cessation of duties, a second lump-sum service pension for the 
48.24 	resumption service period must be calculated to apply the service pension amount in effect 
48.25 	on the date of the firefighter's termination of the resumption service for all years of the 
48.26 	resumption service. No firefighter can be paid twice for the same period of service. If 
48.27 	a lump-sum service pension had not been paid to the firefighter upon the firefighter's 
48.28 	previous cessation of duties and the firefighter meets the minimum service requirement of 
48.29 	section 424A.02, subdivision 2, a service pension shall be calculated to apply the service 
48.30 	pension amount in effect on the date of the firefighter's termination of the resumption 
48.31 	service for all years of service credit.
48.32 	(d) A firefighter who had not been paid a lump-sum service pension returns to active 
48.33 	relief association membership under paragraph (a), who does not qualify for a service 
48.34 	pension under paragraph (b), but who does meet the minimum service requirement of 
48.35 	section 424A.02, subdivision 2, based on the firefighter's previous years of active service, 
49.1 	must have, upon a subsequent cessation of duties, a service pension calculated for the 
49.2 	previous years of service based on the service pension amount in effect on the date of the 
49.3 	firefighter's termination of the resumption service, or, if the bylaws so provide, based on the 
49.4 	service pension amount in effect on the date of the firefighter's previous cessation of duties.
49.5 	(e) If a firefighter receiving a monthly benefit service pension returns to active 
49.6 	monthly benefit relief association membership under paragraph (a), any monthly benefit 
49.7 	service pension payable to the firefighter is suspended as of the first day of the month next 
49.8 	following the date on which the firefighter returns to active membership. If the firefighter 
49.9 	was receiving a monthly benefit service pension, and qualifies for a service pension under 
49.10 	paragraph (b), the firefighter is entitled to an additional monthly benefit service pension 
49.11 	upon a subsequent cessation of duties calculated based on the resumption service credit 
49.12 	and the service pension accrual amount in effect on the date of the termination of the 
49.13 	resumption service. The suspended initial service pension resumes as of the first of 
49.14 	the month next following the termination of the resumption service. If the firefighter 
49.15 	was not receiving a monthly benefit service pension and meets the minimum service 
49.16 	requirement of section 424A.02, subdivision 2, a service pension must be calculated to 
49.17 	apply the service pension amount  in effect on the date of the firefighter's termination of the 
49.18 	resumption service for all years of service credit.
49.19 	(f) A firefighter who was not receiving a monthly benefit service pension returns 
49.20 	to active relief association membership under paragraph (a), who does not qualify for a 
49.21 	service pension under paragraph (b), but who does meet the minimum service requirement 
49.22 	of section 424A.02, subdivision 2, based on the firefighter's previous years of active 
49.23 	service, must have, upon a subsequent cessation of duties, a service pension calculated for 
49.24 	the previous years of service based on the service pension amount in effect on the date 
49.25 	of the firefighter's termination of the resumption service, or, if the bylaws so provide, 
49.26 	based on the service pension amount in effect on the date of the firefighter's previous 
49.27 	cessation of duties.

49.28 	EFFECTIVE DATE. This section is effective July 1, 2009.

49.29 	Sec. 8. Minnesota Statutes 2008, section 424A.02, subdivision 1, is amended to read:
49.30 		Subdivision 1.Authorization. (a) A relief association, when its articles of 
49.31 	incorporation or bylaws so provide, may pay out of the assets of its special fund a 
49.32 	service pension to each of its members who: (1) separates from active service with the 
49.33 	fire department; (2) reaches age 50; (3) completes at least five years of active service 
49.34 	as an active member of the municipal fire department to which the relief association 
49.35 	is associated; (4) completes at least five years of active membership with the relief 
50.1 	association before separation from active service; and (5) complies with any additional 
50.2 	conditions as to age, service, and membership that are prescribed by the bylaws of the 
50.3 	relief association. A service pension computed under this section may be prorated 
50.4 	monthly for fractional years of service, ifas the bylaws or articles of incorporation of 
50.5 	the relief association so provide. The bylaws or articles of incorporation may define a 
50.6 	"month," but the definition must require a calendar month to have at least 16 days of active 
50.7 	service. If the bylaws or articles of incorporation do not define a "month," a "month" is a 
50.8 	completed calendar month of active service measured from the member's date of entry 
50.9 	to the same date in the subsequent month. The service pension may be paid whether or 
50.10 	not the municipality or nonprofit firefighting corporation to which the relief association 
50.11 	is associated qualifies for fire state aid under chapter 69.
50.12 	(b) In the case of a member who has completed at least five years of active service as 
50.13 	an active member of the fire department to which the relief association is associated on 
50.14 	the date that the relief association is established and incorporated, the requirement that 
50.15 	the member complete at least five years of active membership with the relief association 
50.16 	before separation from active service may be waived by the board of trustees of the relief 
50.17 	association if the member completes at least five years of inactive membership with the 
50.18 	relief association before the payment of the service pension. During the period of inactive 
50.19 	membership, the member is not entitled to receive disability benefit coverage, is not 
50.20 	entitled to receive additional service credit towards computation of a service pension, and 
50.21 	is considered to have the status of a person entitled to a deferred service pension under 
50.22 	subdivision 7.
50.23 	(c) No municipality or nonprofit firefighting corporation may delegate the power to 
50.24 	take final action in setting a service pension or ancillary benefit amount or level to the 
50.25 	board of trustees of the relief association or to approve in advance a service pension or 
50.26 	ancillary benefit amount or level equal to the maximum amount or level that this chapter 
50.27 	would allow rather than a specific dollar amount or level.
50.28 	(d) No relief association as defined in section 424A.001, subdivision 4, may pay a 
50.29 	service pension or disability benefit to a former member of the relief association if that 
50.30 	person has not separated from active service with the fire department to which the relief 
50.31 	association is directly associated, unless:
50.32 	(1) the person is employed subsequent to retirement by the municipality or the 
50.33 	independent nonprofit firefighting corporation, whichever applies, to perform duties within 
50.34 	the municipal fire department or corporation on a full-time basis;
50.35 	(2) the governing body of the municipality or of the corporation has filed its 
50.36 	determination with the board of trustees of the relief association that the person's 
51.1 	experience with and service to the fire department in that person's full-time capacity 
51.2 	would be difficult to replace; and
51.3 	(3) the bylaws of the relief association were amended to provide for the payment of 
51.4 	a service pension or disability benefit for such full-time employees.

51.5 	EFFECTIVE DATE. This section is effective July 1, 2009.

51.6 	Sec. 9. Minnesota Statutes 2008, section 424A.02, subdivision 3a, is amended to read:
51.7 		Subd. 3a.Penalty for paying pension greater than applicable maximum. (a) 
51.8 	If a relief association pays a service pension greater than the maximum service pension 
51.9 	associated with the applicable average amount of available financing per active covered 
51.10 	firefighter under the table in subdivision 3, paragraph (c) or (d), whichever applies, the 
51.11 	maximum service pension under subdivision 3, paragraph (f), or the applicable maximum 
51.12 	service pension amount specified in subdivision 3, paragraph (g), whichever is less, the 
51.13 	state auditor shall:
51.14 	(1) disqualify the municipality or the nonprofit firefighting corporation associated 
51.15 	with the relief association from receiving fire state aid by making the appropriate 
51.16 	notification to the municipality and the commissioner of revenue, with the disqualification 
51.17 	applicable for the next apportionment and payment of fire state aid; and
51.18 	(2) order the treasurer of the applicable relief association to recover the amount of 
51.19 	the overpaid service pension or pensions from any retired firefighter who received an 
51.20 	overpayment.
51.21 	(b) Fire state aid amounts from disqualified municipalities for the period of 
51.22 	disqualifications under paragraph (a), clause (1), must be credited to the amount of 
51.23 	fire insurance premium tax proceeds available for the next subsequent fire state aid 
51.24 	apportionment.
51.25 	(c) The amount of any overpaid service pension recovered under paragraph (a), 
51.26 	clause (2), must be credited to the amount of fire insurance premium tax proceeds 
51.27 	available for the next subsequent fire state aid apportionment.
51.28 	(d) The determination of the state auditor that a relief association has paid a service 
51.29 	pension greater than the applicable maximum must be made on the basis of the information 
51.30 	filed by the relief association and the municipality with the state auditor under sections 
51.31 	69.011, subdivision 2, and 69.051, subdivision 1 or 1a, whichever applies, and any other 
51.32 	relevant information that comes to the attention of the state auditor. The determination 
51.33 	of the state auditor is final. An aggrieved municipality, relief association, or person may 
51.34 	appeal the determination under section 480A.06.

52.1 	EFFECTIVE DATE. This section is effective July 1, 2009.

52.2 	Sec. 10. Minnesota Statutes 2008, section 424A.02, subdivision 6, is amended to read:
52.3 		Subd. 6.Payment of service pensions; nonassignability. The method of 
52.4 	calculating service pensions shall be applied uniformly for all years of active service and.
52.5 	Credit shall be given for all years of active service, except as otherwise provided in this 
52.6 	section for caps on service credit if so provided in the bylaws of the relief association. No 
52.7 	service pension shall be paid to any person while the person remains an active member 
52.8 	of the respective fire department, and no person who is receiving a service pension shall 
52.9 	be entitled to receive any other benefits from the special fund of the relief association. 
52.10 	No service pension or ancillary benefits paid or payable from the special fund of a relief 
52.11 	association to any person receiving or entitled to receive a service pension or ancillary 
52.12 	benefits shall be subject to garnishment, judgment, execution, or other legal process, 
52.13 	except as provided in section 518.58, 518.581, or 518A.53. No person entitled to a service 
52.14 	pension or ancillary benefits from the special fund of a relief association may assign any 
52.15 	service pension or ancillary benefit payments, nor shall the association have the authority 
52.16 	to recognize any assignment or pay over any sum which has been assigned.

52.17 	EFFECTIVE DATE. This section is effective July 1, 2009.

52.18 	Sec. 11. Minnesota Statutes 2008, section 424A.02, subdivision 8, is amended to read:
52.19 		Subd. 8.Lump-sum service pensions; installment payments. (a) Any relief 
52.20 	association, if the governing bylaws so provide, may pay, at the option of the retiring 
52.21 	memberintended recipient and in lieu of a single payment of a lump-sum service pension
52.22 	or survivor benefit, a lump-sum service pension or survivor benefit in installments.
52.23 	(b) The election of installment payments shall beis irrevocable and shallmust be 
52.24 	made by the retiring memberintended recipient in writing and filed with the secretary of 
52.25 	the relief association no later than 30 days prior tobefore the commencement of payment 
52.26 	of the service pension or survivor benefit. The amount of the installment payments shall
52.27 	must be determined so that the present value of the aggregate installment payments 
52.28 	computed at an interest rate of five percent, compounded annually, is equal to the amount 
52.29 	of the single lump-sum payment which would have been made had the installment 
52.30 	payments option not been elected. The payment of each installment shall include interest 
52.31 	at the rate of five percent, compounded annually on the reserve supporting the remaining 
52.32 	installment payments as of the date on which the previous installment payment was paid 
52.33 	and computed from the date on which the previous installment payment was paid to the 
52.34 	date of payment for the current installment payment in any reasonable manner provided 
53.1 	for in the governing bylaws, but the total amount of installment payments may not exceed 
53.2 	the single payment service pension amount plus interest at an annual rate of five percent 
53.3 	on the amount of delayed payments for the period during which payment was delayed.
53.4 	(c) To the extent that the commissioner of commerce deems it to be necessary or 
53.5 	practical, the commissioner may specify and issue procedures, forms or mathematical 
53.6 	tables for use in performing the calculations required pursuant to this subdivision.

53.7 	EFFECTIVE DATE. This section is effective July 1, 2009.

53.8 	Sec. 12. Minnesota Statutes 2008, section 424A.02, subdivision 10, is amended to read:
53.9 		Subd. 10.Local approval of bylaw amendments; filing requirements. (a) Each 
53.10 	relief association to which this section applies shall file a revised copy of its governing 
53.11 	bylaws with the state auditor upon the adoption of any amendment to its governing bylaws 
53.12 	by the relief association or upon the approval of any amendment to its governing bylaws 
53.13 	granted by the governing body of each municipality served by the fire department to 
53.14 	which the relief association is directly associated. Failure of the relief association to file a 
53.15 	copy of the bylaws or any bylaw amendments with the state auditor shall disqualify the 
53.16 	municipality from the distribution of any future fire state aid until this filing requirement 
53.17 	has been completed.
53.18 	(b) If the special fund of the relief association does not have a surplus over full 
53.19 	funding pursuant to section 69.772, subdivision 3, clause (2), subclause (e), or 69.773, 
53.20 	subdivision 4, and if the municipality is required to provide financial support to the special 
53.21 	fund of the relief association pursuant to section 69.772 or 69.773, no bylaw amendment 
53.22 	which would affect the amount of, the manner of payment of, or the conditions for 
53.23 	qualification for service pensions or ancillary benefits or disbursements other than 
53.24 	administrative expenses authorized pursuant to section 69.80 payable from the special 
53.25 	fund of the relief association shall be effective until it has been ratified by the governing 
53.26 	body or bodies of the appropriate municipalities. If the municipality is not required to 
53.27 	provide financial support to the special fund pursuant to this section, the relief association 
53.28 	may adopt or amend without municipal ratification its articles of incorporation or bylaws 
53.29 	which increase or otherwise affect the service pensions or ancillary benefits payable from 
53.30 	the special fund so long as the changes do not cause the amount of the resulting increase in 
53.31 	the accrued liability of the special fund to exceed 90 percent of the amount of the prior
53.32 	surplus over full funding reported in the prior year and the changes do not result in the 
53.33 	financial requirements of the special fund exceeding the expected amount of the future fire 
53.34 	state aid to be received by the relief association.
54.1 	(c) If the relief association pays only a lump-sum pension, the financial requirements 
54.2 	are to be determined by the board of trustees following the preparation of an estimate 
54.3 	of the expected increase in the accrued liability and annual accruing liability of the 
54.4 	relief association attributable to the change. If the relief association pays a monthly 
54.5 	benefit service pension, the financial requirements are to be determined by the board of 
54.6 	trustees following either an updated actuarial valuation including the proposed change 
54.7 	or an estimate of the expected actuarial impact of the proposed change prepared by the 
54.8 	actuary of the relief association. If a relief association adopts or amends its articles of 
54.9 	incorporation or bylaws without municipal ratification pursuant to this subdivision, and, 
54.10 	subsequent to the amendment or adoption, the financial requirements of the special fund 
54.11 	pursuant to this section are such so as to require financial support from the municipality, 
54.12 	the provision which was implemented without municipal ratification shall no longer be 
54.13 	effective without municipal ratification, and any service pensions or ancillary benefits 
54.14 	payable after that date shall be paid only in accordance with the articles of incorporation 
54.15 	or bylaws as amended or adopted with municipal ratification.

54.16 	EFFECTIVE DATE. This section is effective July 1, 2009.

54.17 	Sec. 13. Minnesota Statutes 2008, section 424A.04, subdivision 1, is amended to read:
54.18 		Subdivision 1.Membership. (a) A relief association that is directly associated with 
54.19 	a municipal fire department must be managed by a board of trustees consisting of nine 
54.20 	members. Six trustees must be elected from the membership of the relief association and 
54.21 	three trustees must be drawn from the officials of the municipalities served by the fire 
54.22 	department to which the relief association is directly associated. The bylaws of a relief 
54.23 	association which provides a monthly benefit service pension may provide that one of 
54.24 	the six trustees elected from the relief association membership may be a retired member 
54.25 	receiving a monthly pension who is elected by the membership of the relief association. 
54.26 	The three municipal trustees must be one elected municipal official and one elected or 
54.27 	appointed municipal official who are designated as municipal representatives by the 
54.28 	municipal governing board annually and the chief of the municipal fire department.
54.29 	(b) A relief association that is a subsidiary of an independent nonprofit firefighting 
54.30 	corporation must be managed by a board of trustees consisting of nine members. Six 
54.31 	trustees must be elected from the membership of the relief association, two trustees must 
54.32 	be drawn from the officials of the municipalities served by the fire department to which 
54.33 	the relief association is directly associated, and one trustee shallmust be the fire chief 
54.34 	serving with the independent nonprofit firefighting corporation. The bylaws of a relief 
54.35 	association may provide that one of the six trustees elected from the relief association 
55.1 	membership may be a retired member receiving a monthly pension who is elected by the 
55.2 	membership of the relief association. The two municipal trustees must be elected or 
55.3 	appointed municipal officials, selected as follows:
55.4 	(1) if only one municipality contracts with the independent nonprofit firefighting 
55.5 	corporation, the municipal trustees must be two officials of the contracting municipality 
55.6 	who are designated annually by the governing body of the municipality; or
55.7 	(2) if two or more municipalities contract with the independent nonprofit corporation, 
55.8 	the municipal trustees must be one official from each of the two largest municipalities 
55.9 	in population who are designated annually by the governing bodies of the applicable 
55.10 	municipalities.
55.11 	(c) The municipal trustees for a relief association that is directly associated with a 
55.12 	fire department operated as or by a joint powers entity must be the fire chief of the fire 
55.13 	department and two trustees designated annually by the joint powers board. The municipal 
55.14 	trustees for a relief association that is directly associated with a fire department service 
55.15 	area township must be the fire chief of the fire department and two trustees designated by 
55.16 	the township board.
55.17 	(d) If a relief association lacks the municipal board members provided for in 
55.18 	paragraph (a), (b), or (c) because the fire department is not located in or associated with an 
55.19 	organized municipality, joint powers entity, or township, the municipal board members 
55.20 	must be the fire chief of the fire department and two board members appointed from the 
55.21 	fire department service area by the board of commissioners of the applicable county.
55.22 	(e) The term of thesethe appointed municipal board members is one year or until the 
55.23 	person's successor is qualified, whichever is later.
55.24 	(f) A municipal trustee under paragraph (a), (b), (c), or (d) has all the rights 
55.25 	and duties accorded to any other trustee, except the right to be an officer of the relief 
55.26 	association board of trustees.
55.27 	(g) A board must have at least three officers, who are a president, a secretary and a 
55.28 	treasurer. These officers must be elected from among the elected trustees by either the full 
55.29 	board of trustees or by the relief association membership, as specified in the bylaws. In 
55.30 	no event may any trustee hold more than one officer position at any one time. The terms 
55.31 	of the elected trustees and of the officers of the board must be specified in the bylaws of 
55.32 	the relief association, but may not exceed three years. If the term of the elected trustees 
55.33 	exceeds one year, the election of the various trustees elected from the membership must be 
55.34 	staggered on as equal a basis as is practicable.

55.35 	EFFECTIVE DATE. This section is effective July 1, 2009.

56.1 	Sec. 14. Minnesota Statutes 2008, section 424A.05, subdivision 3, is amended to read:
56.2 		Subd. 3.Authorized disbursements from the special fund. (a) Disbursements 
56.3 	from the special fund are not permitted to be made for any purpose other than one of 
56.4 	the following:
56.5 	(1) for the payment of service pensions to retired members of the relief association if 
56.6 	authorized and paid under law and the bylaws governing the relief association;
56.7 	(2) for the payment of temporary or permanent disability benefits to disabled 
56.8 	members of the relief association if authorized and paid pursuant to law and specified in 
56.9 	amount in the bylaws governing the relief association;
56.10 	(3) for the payment of survivor benefits to surviving spouses and surviving children, 
56.11 	or if none, to designated beneficiaries, of deceased members of the relief association, 
56.12 	and if survivors and if no designated beneficiary, for the payment of a death benefit to 
56.13 	the estate of the deceased active firefighter, if authorized by and paid pursuant to law and 
56.14 	specified in amount in the bylaws governing the relief association;
56.15 	(4) for the payment of the fees, dues and assessments to the Minnesota State Fire 
56.16 	Department Association,and to the Minnesota Area Relief Association Coalition, and to 
56.17 	the state Volunteer Firefighters Benefit Association in order to entitle relief association 
56.18 	members to membership in and the benefits of these associations or organizations; and
56.19 	(5) for the payment of insurance premiums to the state Volunteer Firefighters Benefit 
56.20 	Association, or an insurance company licensed by the state of Minnesota offering casualty 
56.21 	insurance, in order to entitle relief association members to membership in and the benefits 
56.22 	of the association or organization; and
56.23 	(5)(6) for the payment of administrative expenses of the relief association as 
56.24 	authorized under section 69.80. 
56.25 	(b) For purposes of this chapter, for a monthly benefit volunteer fire relief association 
56.26 	or for a combination lump-sum and monthly benefit volunteer fire relief association where 
56.27 	a monthly benefit service pension has been elected by or a monthly benefit is payable with 
56.28 	respect to a firefighter, a designated beneficiary must be a natural person. For purposes of 
56.29 	this chapter, for a defined contribution volunteer fire relief association, for a lump-sum 
56.30 	volunteer fire relief association, or for a combination lump-sum and monthly benefit 
56.31 	volunteer fire relief association where a lump-sum service pension has been elected by 
56.32 	or a lump-sum benefit is payable with respect to a firefighter, a designated beneficiary 
56.33 	may be a trust created under chapter 501B.

56.34 	EFFECTIVE DATE. This section is effective July 1, 2009.

57.1 	Sec. 15. Minnesota Statutes 2008, section 424A.08, is amended to read:
57.2 	424A.08 MUNICIPALITY WITHOUT RELIEF ASSOCIATION; 
57.3 	AUTHORIZED DISBURSEMENTS.
57.4 	(a) Any qualified municipality which is entitled to receive fire state aid but which has 
57.5 	no volunteer firefighters' relief association directly associated with its fire department and 
57.6 	which has no full-time firefighters with retirement coverage by the public employees police 
57.7 	and fire retirement plan shall deposit the fire state aid in a special account in the municipal 
57.8 	treasury. Disbursement from the special account shall not be made for any purpose except:
57.9 	(1) payment of the fees, dues and assessments to the Minnesota State Fire 
57.10 	Department Association and to the state Volunteer Firefighters' Benefit Association in 
57.11 	order to entitle its firefighters to membership in and the benefits of these state associations;
57.12 	(2) payment of the cost of purchasing and maintaining needed equipment for the 
57.13 	fire department; and
57.14 	(3) payment of the cost for construction, acquisition, repair and maintenance of 
57.15 	buildings or other premises to house the fire department.
57.16 	(b) A qualified municipality which is entitled to receive fire state aid, which has no 
57.17 	volunteer firefighters' relief association directly associated with its fire department and 
57.18 	which has full-time firefighters with retirement coverage by the public employees police 
57.19 	and fire retirement plan may disburse the fire state aid as provided in paragraph (a), for the 
57.20 	payment of the employer contribution requirement with respect to firefighters covered by 
57.21 	the public employees police and fire retirement plan under section 353.65, subdivision 3, 
57.22 	or for a combination of the two types of disbursements.

57.23 	EFFECTIVE DATE. This section is effective July 1, 2009.

57.24 	Sec. 16. Minnesota Statutes 2008, section 424A.10, subdivision 1, is amended to read:
57.25 		Subdivision 1. Definitions. For purposes of this section: 
57.26 	(1) "qualified recipient" means an individual who receives a lump-sum distribution 
57.27 	of pension or retirement benefits from a firefighters' relief association for service that the 
57.28 	individual has performed as a volunteer firefighter;
57.29 	(2) "survivor of a deceased active or deferred volunteer firefighter" means the legally 
57.30 	marriedsurviving spouse of a deceased active or deferred volunteer firefighter under 
57.31 	section 424A.001, subdivision 6, or, if none, the surviving minor child or minor children 
57.32 	of a deceased active or deferred volunteer firefighter; 
57.33 	(3) "active volunteer firefighter" means a person who regularly renders fire 
57.34 	suppression service for a municipal fire department or an independent nonprofit firefighting 
58.1 	corporation, who has met the statutory and other requirements for relief association 
58.2 	membership, and who has beenis deemed by the relief association under law and its 
58.3 	bylaws to be a fully qualified member of the relief association for at least one month; and
58.4 	(4) "deferred volunteer firefighter" means a former active volunteer firefighter who 
58.5 	terminated active firefighting service, has sufficient service credit from the applicable relief 
58.6 	association to be entitled to a service pension under the bylaws of the relief association, 
58.7 	but has not applied for or has not received the service pension.

58.8 	EFFECTIVE DATE. This section is effective July 1, 2009.

58.9 	Sec. 17.  REPEALER.
 58.10 	Minnesota Statutes 2008, section 424A.02, subdivision 9b, is repealed.

58.11 	EFFECTIVE DATE. This section is effective July 1, 2009.

58.12 	ARTICLE 4
58.13 	ACCOMMODATING CHANGES

58.14 	Section 1. [420.20] PROHIBITION OF SERVICE BY MINORS AS VOLUNTEER 
58.15 	FIREFIGHTERS.
58.16 	It is unlawful for any municipality or independent nonprofit firefighting corporation 
58.17 	to employ a minor to serve as a firefighter or to permit a minor to serve in any capacity 
58.18 	performing any firefighting duties with a fire department, except for members of a youth, 
58.19 	civic, or educational organization or program who participate with uninterrupted adult 
58.20 	supervision, as allowed by federal law and by section 181A.04. Such organizations or 
58.21 	programs include, but are not limited to, Boy Scout Explorer programs or firefighting 
58.22 	degree programs.

58.23 	EFFECTIVE DATE. This section is effective July 1, 2009, if article 1, section 1, 
58.24 	and article 3, section 6, are enacted.

58.25 	Sec. 2. Minnesota Statutes 2008, section 424A.01, subdivision 1, is amended to read:
58.26 		Subdivision 1.Minors. It is unlawful for any(a) No volunteer firefighters' relief 
58.27 	association associated with a municipality or an independent nonprofit firefighting 
58.28 	corporation to employmay include as a relief association member a minor serving as 
58.29 	a volunteer firefighter or to permit a minor to serve in any capacity performing any 
58.30 	firefighting duties with a volunteer fire department, except for members of a youth, 
58.31 	civic, or educational organization or program who participate with uninterrupted adult 
59.1 	supervision, as allowed by federal law and by section 181A.04. Such organizations or 
59.2 	programs include, but are not limited to, Boy Scout Explorer programs or firefighting 
59.3 	degree programs.
59.4 	(b) No volunteer firefighters' relief association associated with a municipality or an 
59.5 	independent nonprofit firefighting corporation may include as a relief association member 
59.6 	a minor serving as a volunteer firefighter.

59.7 	EFFECTIVE DATE. This section is effective July 1, 2009, if article 1, section 
59.8 	15, and article 3, section 6, are enacted.

59.9 	Sec. 3. [424A.016] DEFINED CONTRIBUTION VOLUNTEER 
59.10 	FIREFIGHTERS' RELIEF ASSOCIATION SPECIFIC REGULATION.
59.11 		Subdivision 1.Defined contribution relief association authorization. If the 
59.12 	articles of incorporation or the bylaws governing the volunteer firefighters' relief 
59.13 	association so provide exclusively, the relief association may pay a defined contribution 
59.14 	lump-sum service pension instead of a defined benefit service pension governed by section 
59.15 	424A.02.
59.16 		Subd. 2.Defined contribution service pension eligibility. (a) A relief association, 
59.17 	when its articles of incorporation or bylaws so provide, may pay out of the assets of its 
59.18 	special fund a service pension to each of its members who:
59.19 	(1) separates from active service with the fire department;
59.20 	(2) reaches age 50;
59.21 	(3) completes at least five years of active service as an active member of the 
59.22 	municipal fire department to which the relief association is associated;
59.23 	(4) completes at least five years of active membership with the relief association 
59.24 	before separation from active service; and
59.25 	(5) complies with any additional conditions as to age, service, and membership that 
59.26 	are prescribed by the bylaws of the relief association.
59.27 	(b) In the case of a member who has completed at least five years of active service as 
59.28 	an active member of the fire department to which the relief association is associated on 
59.29 	the date that the relief association is established and incorporated, the requirement that 
59.30 	the member complete at least five years of active membership with the relief association 
59.31 	before separation from active service may be waived by the board of trustees of the relief 
59.32 	association if the member completes at least five years of inactive membership with the 
59.33 	relief association before the date of the payment of the service pension. During the period 
59.34 	of inactive membership, the member is not entitled to receive any disability benefit 
59.35 	coverage, is not entitled to receive additional individual account allocation of fire state 
60.1 	aid or municipal contribution towards a service pension, and is considered to have the 
60.2 	status of a person entitled to a deferred service pension.
60.3 	(c) The service pension earned by a volunteer under this chapter and the articles 
60.4 	of incorporation and bylaws of the relief association may be paid whether or not the 
60.5 	municipality or nonprofit firefighting corporation to which the relief association is 
60.6 	associated qualifies for the receipt of fire state aid under chapter 69.
60.7 		Subd. 3.Reduced vesting schedule. If the articles of incorporation or bylaws of a 
60.8 	defined contribution relief association so provide, a relief association may pay a reduced 
60.9 	service pension not to exceed the nonforfeitable percentage of the account balance to a 
60.10 	retiring member who has completed fewer than 20 years of service. The reduced service 
60.11 	pension may be paid when the retiring member meets the minimum age and service 
60.12 	requirements of subdivision 2. The nonforfeitable percentage of pension amounts are 
60.13 	as follows:

60.14
60.15		Completed Years of Service
	Nonforfeitable Percentage 
of Pension Amount
	
60.16		5
		40 percent
	
60.17		6
		52 percent
	
60.18		7
		64 percent
	
60.19		8
		76 percent
	
60.20		9
		88 percent
	
60.21		10
	and thereafter
	100 percent
	
60.22 		Subd. 4.Individual accounts. (a) An individual account must be established for 
60.23 	each firefighter who is a member of the relief association.
60.24 	(b) To each individual active member account must be credited an equal share of:
60.25 	(1) any amounts of fire state aid received by the relief association;
60.26 	(2) any amounts of municipal contributions to the relief association raised from 
60.27 	levies on real estate or from other available municipal revenue sources exclusive of fire 
60.28 	state aid; and
60.29 	(3) any amounts equal to the share of the assets of the special fund to the credit of:
60.30 	(i) any former member who terminated active service with the fire department to 
60.31 	which the relief association is associated before meeting the minimum service requirement 
60.32 	provided for in subdivision 2, paragraph (b), and has not returned to active service with 
60.33 	the fire department for a period no shorter than five years; or
60.34 	(ii) any retired member who retired before obtaining a full nonforfeitable interest in 
60.35 	the amounts credited to the individual member account under subdivision 2, paragraph 
60.36 	(b), and any applicable provision of the bylaws of the relief association. In addition, any 
60.37 	investment return on the assets of the special fund must be credited in proportion to the 
61.1 	share of the assets of the special fund to the credit of each individual active member 
61.2 	account. Administrative expenses of the relief association payable from the special 
61.3 	fund may be deducted from individual accounts in a manner specified in the bylaws of 
61.4 	the relief association. 
61.5 	(c) Amounts to be credited to individual accounts must be allocated uniformly for all 
61.6 	years of active service and allocations must be made for all years of service, except for 
61.7 	caps on service credit if so provided in the bylaws of the relief association. The allocation 
61.8 	method may utilize monthly proration for fractional years of service, as the bylaws or 
61.9 	articles of incorporation of the relief association so provide. The bylaws or articles of 
61.10 	incorporation may define a "month," but the definition must require a calendar month to 
61.11 	have at least 16 days of active service. If the bylaws or articles of incorporation do not 
61.12 	define a "month," a "month" is a completed calendar month of active service measured 
61.13 	from the member's date of entry to the same date in the subsequent month. 
61.14 	(d) At the time of retirement under subdivision 2 and any applicable provision of the 
61.15 	bylaws of the relief association, a retiring member is entitled to that portion of the assets 
61.16 	of the special fund to the credit of the member in the individual member account which is 
61.17 	nonforfeitable under subdivision 3 and any applicable provision of the bylaws of the relief 
61.18 	association based on the number of years of service to the credit of the retiring member.
61.19 	(e) Annually, the secretary of the relief association shall certify the individual 
61.20 	account allocations to the state auditor at the same time that the annual financial statement 
61.21 	or financial report and audit of the relief association, whichever applies, is due under 
61.22 	section 69.051.
61.23 		Subd. 5.Service pension installment payments. A defined contribution relief 
61.24 	association, if the governing bylaws so provide, may pay, at the option of the retiring 
61.25 	member and in lieu of a single payment of a service pension, the service pension in 
61.26 	installments. The election of installment payments is irrevocable and must be made by the 
61.27 	retiring member in writing and filed with the secretary of the relief association no later 
61.28 	than 30 days before the commencement of payment of the service pension. The amount of 
61.29 	the installment payments must be the fractional portion of the remaining account balance 
61.30 	equal to one divided by the number of remaining annual installment payments.
61.31 		Subd. 6.Deferred service pensions. (a) A member of a relief association is entitled 
61.32 	to a deferred service pension if the member:
61.33 	(1) has completed the lesser of the minimum period of active service with the fire 
61.34 	department specified in the bylaws or 20 years of active service with the fire department;
61.35 	(2) has completed at least five years of active membership in the relief association; 
61.36 	and
62.1 	(3) separates from active service and membership before reaching age 50 or the 
62.2 	minimum age for retirement and commencement of a service pension specified in the 
62.3 	bylaws governing the relief association if that age is greater than age 50.
62.4 	(b) The deferred service pension is payable when the former member reaches age 
62.5 	50, or the minimum age specified in the bylaws governing the relief association if that age 
62.6 	is greater than age 50, and when the former member makes a valid written application.
62.7 	(c) A defined contribution relief association may, if its governing bylaws so provide, 
62.8 	credit interest or additional investment performance on the deferred lump-sum service 
62.9 	pension during the period of deferral. If provided for in the bylaws, the interest must be 
62.10 	paid:
62.11 	(1) at the investment performance rate actually earned on that portion of the assets 
62.12 	if the deferred benefit amount is invested by the relief association in a separate account 
62.13 	established and maintained by the relief association or if the deferred benefit amount is 
62.14 	invested in a separate investment vehicle held by the relief association; or 
62.15 	(2) the investment return on the assets of the special fund of the defined contribution 
62.16 	volunteer firefighter relief association in proportion to the share of the assets of the special 
62.17 	fund to the credit of each individual deferred member account through the date on which 
62.18 	the investment return is recognized by and credited to the special fund.
62.19 	(d) The deferred service pension is governed by and must be calculated under 
62.20 	the general statute, special law, relief association articles of incorporation, and relief 
62.21 	association bylaw provisions applicable on the date on which the member separated from 
62.22 	active service with the fire department and active membership in the relief association.
62.23 		Subd. 7.Limitation on ancillary benefits. (a) A defined contribution relief 
62.24 	association may only pay an ancillary benefit which would constitute an authorized 
62.25 	disbursement as specified in section 424A.05. The ancillary benefit for active members 
62.26 	must equal the vested or nonvested amount of the individual account of the member.
62.27 	(b) For deferred members, the ancillary benefit must equal the vested amount of 
62.28 	the individual account of the member. For the recipient of installment payments of a 
62.29 	service pension, the ancillary benefit must equal the remaining balance in the individual 
62.30 	account of the recipient.
62.31 		Subd. 8.Filing of bylaw amendments. Each relief association to which this section 
62.32 	applies must file a revised copy of its governing bylaws with the state auditor upon the 
62.33 	adoption of any amendment to its governing bylaws by the relief association. Failure of 
62.34 	the relief association to file a copy of the bylaws or any bylaw amendments with the state 
62.35 	auditor disqualifies the municipality from the distribution of any future fire state aid until 
62.36 	this filing requirement has been completed.

63.1 	EFFECTIVE DATE. This section is effective July 1, 2009, if article 1, section 17, 
63.2 	and article 3, sections 8 and 10, are enacted.

63.3 	Sec. 4. Minnesota Statutes 2008, section 424A.02, subdivision 1, is amended to read:
63.4 		Subdivision 1.Authorization. (a) A defined benefit relief association, when its 
63.5 	articles of incorporation or bylaws so provide, may pay out of the assets of its special fund 
63.6 	a service pension to each of its members who: (1) separates from active service with the 
63.7 	fire department; (2) reaches age 50; (3) completes at least five years of active service 
63.8 	as an active member of the municipal fire department to which the relief association 
63.9 	is associated; (4) completes at least five years of active membership with the relief 
63.10 	association before separation from active service; and (5) complies with any additional 
63.11 	conditions as to age, service, and membership that are prescribed by the bylaws of the 
63.12 	relief association. A service pension computed under this section may be prorated monthly 
63.13 	for fractional years of service, ifas the bylaws or articles of incorporation of the relief 
63.14 	association so provide. The bylaws or articles of incorporation may define a "month," but 
63.15 	the definition must require a calendar month to have at least 16 days of active service. If 
63.16 	the bylaws or articles of incorporation do not define a "month," a "month" is a completed 
63.17 	calendar month of active service measured from the member's date of entry to the same 
63.18 	date in the subsequent month. The service pension earned by a volunteer firefighter under 
63.19 	this chapter and the articles of incorporation and bylaws of the volunteer firefighters' 
63.20 	relief association may be paid whether or not the municipality or nonprofit firefighting 
63.21 	corporation to which the relief association is associated qualifies for the receipt of fire 
63.22 	state aid under chapter 69.
63.23 	(b) In the case of a member who has completed at least five years of active service as 
63.24 	an active member of the fire department to which the relief association is associated on 
63.25 	the date that the relief association is established and incorporated, the requirement that 
63.26 	the member complete at least five years of active membership with the relief association 
63.27 	before separation from active service may be waived by the board of trustees of the relief 
63.28 	association if the member completes at least five years of inactive membership with the 
63.29 	relief association before the date of the payment of the service pension. During the 
63.30 	period of inactive membership, the member is not entitled to receive disability benefit 
63.31 	coverage, is not entitled to receive additional service credit towards computation of a 
63.32 	service pension, and is considered to have the status of a person entitled to a deferred 
63.33 	service pension under subdivision 7.
63.34 	(c) No municipality or nonprofit firefighting corporation may delegate the power to 
63.35 	take final action in setting a service pension or ancillary benefit amount or level to the 
64.1 	board of trustees of the relief association or to approve in advance a service pension or 
64.2 	ancillary benefit amount or level equal to the maximum amount or level that this chapter 
64.3 	would allow rather than a specific dollar amount or level.
64.4 	(d) No relief association as defined in section 424A.001, subdivision 4, may pay a 
64.5 	service pension or disability benefit to a former member of the relief association if that 
64.6 	person has not separated from active service with the fire department to which the relief 
64.7 	association is directly associated, unless:
64.8 	(1) the person is employed subsequent to retirement by the municipality or the 
64.9 	independent nonprofit firefighting corporation, whichever applies, to perform duties within 
64.10 	the municipal fire department or corporation on a full-time basis;
64.11 	(2) the governing body of the municipality or of the corporation has filed its 
64.12 	determination with the board of trustees of the relief association that the person's 
64.13 	experience with and service to the fire department in that person's full-time capacity 
64.14 	would be difficult to replace; and
64.15 	(3) the bylaws of the relief association were amended to provide for the payment of 
64.16 	a service pension or disability benefit for such full-time employees.

64.17 	EFFECTIVE DATE. This section is effective July 1, 2009, if article 1, section 
64.18 	18, and article 3, section 8, are enacted.

64.19 	Sec. 5. Minnesota Statutes 2008, section 424A.02, subdivision 3, is amended to read:
64.20 		Subd. 3.Flexible service pension maximums. (a) Annually on or before August 1 
64.21 	as part of the certification of the financial requirements and minimum municipal obligation 
64.22 	determined under section 69.772, subdivision 4, or 69.773, subdivision 5, as applicable, 
64.23 	the secretary or some other official of the relief association designated in the bylaws of 
64.24 	each defined benefit relief association shall calculate and certify to the governing body 
64.25 	of the applicable qualified municipality the average amount of available financing per 
64.26 	active covered firefighter for the most recent three-year period. The amount of available 
64.27 	financing shall includeincludes any amounts of fire state aid received or receivable by the 
64.28 	relief association, any amounts of municipal contributions to the relief association raised 
64.29 	from levies on real estate or from other available revenue sources exclusive of fire state 
64.30 	aid, and one-tenth of the amount of assets in excess of the accrued liabilities of the relief 
64.31 	association calculated under section 69.772, subdivision 2; 69.773, subdivisions 2 and 4; 
64.32 	or 69.774, subdivision 2, if any.
64.33 	(b) The maximum service pension which the defined benefit relief association has 
64.34 	authority to provide for in its bylaws for payment to a member retiring after the calculation 
65.1 	date when the minimum age and service requirements specified in subdivision 1 are met 
65.2 	must be determined using the table in paragraph (c) or (d), whichever applies.
65.3 	(c) For a defined benefit relief association where the governing bylaws provide for 
65.4 	a monthly service pension to a retiring member, the maximum monthly service pension 
65.5 	amount per month for each year of service credited that may be provided for in the bylaws 
65.6 	is the greater of the service pension amount provided for in the bylaws on the date of the 
65.7 	calculation of the average amount of the available financing per active covered firefighter 
65.8 	or the maximum service pension figure corresponding to the average amount of available 
65.9 	financing per active covered firefighter:

65.10
65.11
65.12	Minimum Average Amount of Available 
Financing per Firefighter
	Maximum Service Pension Amount 
Payable per Month for Each 
Year of Service
	
65.13	$ ...
		$ .25
		
65.14	41
		.50
		
65.15	81
		1.00
		
65.16	122
		1.50
		
65.17	162
		2.00
		
65.18	203
		2.50
		
65.19	243
		3.00
		
65.20	284
		3.50
		
65.21	324
		4.00
		
65.22	365
		4.50
		
65.23	405
		5.00
		
65.24	486
		6.00
		
65.25	567
		7.00
		
65.26	648
		8.00
		
65.27	729
		9.00
		
65.28	810
		10.00
		
65.29	891
		11.00
		
65.30	972
		12.00
		
65.31	1053
		13.00
		
65.32	1134
		14.00
		
65.33	1215
		15.00
		
65.34	1296
		16.00
		
65.35	1377
		17.00
		
65.36	1458
		18.00
		
65.37	1539
		19.00
		
65.38	1620
		20.00
		
65.39	1701
		21.00
		
65.40	1782
		22.00
		
65.41	1823
		22.50
		
65.42	1863
		23.00
		
66.1	1944
		24.00
		
66.2	2025
		25.00
		
66.3	2106
		26.00
		
66.4	2187
		27.00
		
66.5	2268
		28.00
		
66.6	2349
		29.00
		
66.7	2430
		30.00
		
66.8	2511
		31.00
		
66.9	2592
		32.00
		
66.10	2673
		33.00
		
66.11	2754
		34.00
		
66.12	2834
		35.00
		
66.13	2916
		36.00
		
66.14	2997
		37.00
		
66.15	3078
		38.00
		
66.16	3159
		39.00
		
66.17	3240
		40.00
		
66.18	3321
		41.00
		
66.19	3402
		42.00
		
66.20	3483
		43.00
		
66.21	3564
		44.00
		
66.22	3645
		45.00
		
66.23	3726
		46.00
		
66.24	3807
		47.00
		
66.25	3888
		48.00
		
66.26	3969
		49.00
		
66.27	4050
		50.00
		
66.28	4131
		51.00
		
66.29	4212
		52.00
		
66.30	4293
		53.00
		
66.31	4374
		54.00
		
66.32	4455
		55.00
		
66.33	4536
		56.00
		
66.34	Effective beginning December 31, 2008
			
66.35	4617
		57.00
		
66.36	4698
		58.00
		
66.37	4779
		59.00
		
66.38	4860
		60.00
		
66.39	4941
		61.00
		
66.40	5022
		62.00
		
66.41	5103
		63.00
		
66.42	5184
		64.00
		
66.43	5265
		65.00
		
67.1	Effective beginning December 31, 2009
			
67.2	5346
		66.00
		
67.3	5427
		67.00
		
67.4	5508
		68.00
		
67.5	5589
		69.00
		
67.6	5670
		70.00
		
67.7	5751
		71.00
		
67.8	5832
		72.00
		
67.9	5913
		73.00
		
67.10	5994
		74.00
		
67.11	Effective beginning December 31, 2010
			
67.12	6075
		75.00
		
67.13	6156
		76.00
		
67.14	6237
		77.00
		
67.15	6318
		78.00
		
67.16	6399
		79.00
		
67.17	6480
		80.00
		
67.18	6561
		81.00
		
67.19	6642
		82.00
		
67.20	6723
		83.00
		
67.21	Effective beginning December 31, 2011
			
67.22	6804
		84.00
		
67.23	6885
		85.00
		
67.24	6966
		86.00
		
67.25	7047
		87.00
		
67.26	7128
		88.00
		
67.27	7209
		89.00
		
67.28	7290
		90.00
		
67.29	7371
		91.00
		
67.30	7452
		92.00
		
67.31	Effective beginning December 31, 2012
			
67.32	7533
		93.00
		
67.33	7614
		94.00
		
67.34	7695
		95.00
		
67.35	7776
		96.00
		
67.36	7857
		97.00
		
67.37	7938
		98.00
		
67.38	8019
		99.00
		
67.39	8100
		100.00
		
67.40	any amount in excess of 
				
67.41	8100
		100.00
		
67.42 	(d) For a defined benefit relief association in which the governing bylaws provide 
67.43 	for a lump-sum service pension to a retiring member, the maximum lump-sum service 
68.1 	pension amount for each year of service credited that may be provided for in the bylaws is 
68.2 	the greater of the service pension amount provided for in the bylaws on the date of the 
68.3 	calculation of the average amount of the available financing per active covered firefighter 
68.4 	or the maximum service pension figure corresponding to the average amount of available 
68.5 	financing per active covered firefighter for the applicable specified period:

68.6
68.7
68.8	Minimum Average Amount of Available 
Financing per Firefighter
	Maximum Lump-Sum Service 
Pension Amount Payable for 
Each Year of Service
	
68.9	$ ...
		$ 10
		
68.10	11
		20
		
68.11	16
		30
		
68.12	23
		40
		
68.13	27
		50
		
68.14	32
		60
		
68.15	43
		80
		
68.16	54
		100
		
68.17	65
		120
		
68.18	77
		140
		
68.19	86
		160
		
68.20	97
		180
		
68.21	108
		200
		
68.22	131
		240
		
68.23	151
		280
		
68.24	173
		320
		
68.25	194
		360
		
68.26	216
		400
		
68.27	239
		440
		
68.28	259
		480
		
68.29	281
		520
		
68.30	302
		560
		
68.31	324
		600
		
68.32	347
		640
		
68.33	367
		680
		
68.34	389
		720
		
68.35	410
		760
		
68.36	432
		800
		
68.37	486
		900
		
68.38	540
		1000
		
68.39	594
		1100
		
68.40	648
		1200
		
68.41	702
		1300
		
68.42	756
		1400
		
68.43	810
		1500
		
69.1	864
		1600
		
69.2	918
		1700
		
69.3	972
		1800
		
69.4	1026
		1900
		
69.5	1080
		2000
		
69.6	1134
		2100
		
69.7	1188
		2200
		
69.8	1242
		2300
		
69.9	1296
		2400
		
69.10	1350
		2500
		
69.11	1404
		2600
		
69.12	1458
		2700
		
69.13	1512
		2800
		
69.14	1566
		2900
		
69.15	1620
		3000
		
69.16	1672
		3100
		
69.17	1726
		3200
		
69.18	1753
		3250
		
69.19	1780
		3300
		
69.20	1820
		3375
		
69.21	1834
		3400
		
69.22	1888
		3500
		
69.23	1942
		3600
		
69.24	1996
		3700
		
69.25	2023
		3750
		
69.26	2050
		3800
		
69.27	2104
		3900
		
69.28	2158
		4000
		
69.29	2212
		4100
		
69.30	2265
		4200
		
69.31	2319
		4300
		
69.32	2373
		4400
		
69.33	2427
		4500
		
69.34	2481
		4600
		
69.35	2535
		4700
		
69.36	2589
		4800
		
69.37	2643
		4900
		
69.38	2697
		5000
		
69.39	2751
		5100
		
69.40	2805
		5200
		
69.41	2859
		5300
		
69.42	2913
		5400
		
69.43	2967
		5500
		
70.1	3021
		5600
		
70.2	3075
		5700
		
70.3	3129
		5800
		
70.4	3183
		5900
		
70.5	3237
		6000
		
70.6	3291
		6100
		
70.7	3345
		6200
		
70.8	3399
		6300
		
70.9	3453
		6400
		
70.10	3507
		6500
		
70.11	3561
		6600
		
70.12	3615
		6700
		
70.13	3669
		6800
		
70.14	3723
		6900
		
70.15	3777
		7000
		
70.16	3831
		7100
		
70.17	3885
		7200
		
70.18	3939
		7300
		
70.19	3993
		7400
		
70.20	4047
		7500
		
70.21	Effective beginning December 31, 2008
			
70.22	4101
		7600
		
70.23	4155
		7700
		
70.24	4209
		7800
		
70.25	4263
		7900
		
70.26	4317
		8000
		
70.27	4371
		8100
		
70.28	4425
		8200
		
70.29	4479
		8300
		
70.30	Effective beginning December 31, 2009
			
70.31	4533
		8400
		
70.32	4587
		8500
		
70.33	4641
		8600
		
70.34	4695
		8700
		
70.35	4749
		8800
		
70.36	4803
		8900
		
70.37	4857
		9000
		
70.38	4911
		9100
		
70.39	Effective beginning December 31, 2010
			
70.40	4965
		9200
		
70.41	5019
		9300
		
70.42	5073
		9400
		
70.43	5127
		9500
		
71.1	5181
		9600
		
71.2	5235
		9700
		
71.3	5289
		9800
		
71.4	5343
		9900
		
71.5	5397
		10,000
		
71.6	any amount in excess of
				
71.7	5397
		10,000
		
71.8 	(e) For a defined benefit relief association in which the governing bylaws provide 
71.9 	for a monthly benefit service pension as an alternative form of service pension payment 
71.10 	to a lump-sum service pension, the maximum service pension amount for each pension 
71.11 	payment type must be determined using the applicable table contained in this subdivision.
71.12 	(f) If a defined benefit relief association establishes a service pension in compliance 
71.13 	with the applicable maximum contained in paragraph (c) or (d) and the minimum average 
71.14 	amount of available financing per active covered firefighter is subsequently reduced 
71.15 	because of a reduction in fire state aid or because of an increase in the number of active 
71.16 	firefighters, the relief association may continue to provide the prior service pension 
71.17 	amount specified in its bylaws, but may not increase the service pension amount until 
71.18 	the minimum average amount of available financing per firefighter under the table in 
71.19 	paragraph (c) or (d), whichever applies, permits.
71.20 	(g) No defined benefit relief association is authorized to provide a service pension in 
71.21 	an amount greater than the largest applicable flexible service pension maximum amount 
71.22 	even if the amount of available financing per firefighter is greater than the financing 
71.23 	amount associated with the largest applicable flexible service pension maximum.
71.24 	(h) The method of calculating service pensions must be applied uniformly for all 
71.25 	years of active service. Credit must be given for all years of active service except for caps 
71.26 	on service credit if so provided in the bylaws of the relief association.

71.27 	EFFECTIVE DATE. This section is effective July 1, 2009, if article 1, section 
71.28 	20, and article 3, section 10, are enacted.

71.29 	Sec. 6. Minnesota Statutes 2008, section 424A.02, subdivision 3a, is amended to read:
71.30 		Subd. 3a.Penalty for paying pension greater than applicable maximum. (a) 
71.31 	If a defined benefit relief association pays a service pension greater than the maximum 
71.32 	service pension associated with the applicable average amount of available financing per 
71.33 	active covered firefighter under the table in subdivision 3, paragraph (c) or (d), whichever 
71.34 	applies, the maximum service pension under subdivision 3, paragraph (f), or the applicable 
72.1 	maximum service pension amount specified in subdivision 3, paragraph (g), whichever is 
72.2 	less, the state auditor shall:
72.3 	(1) disqualify the municipality or the nonprofit firefighting corporation associated 
72.4 	with the relief association from receiving fire state aid by making the appropriate 
72.5 	notification to the municipality and the commissioner of revenue, with the disqualification 
72.6 	applicable for the next apportionment and payment of fire state aid; and
72.7 	(2) order the treasurer of the applicable relief association to recover the amount of 
72.8 	the overpaid service pension or pensions from any retired firefighter who received an 
72.9 	overpayment.
72.10 	(b) Fire state aid amounts from disqualified municipalities for the period of 
72.11 	disqualifications under paragraph (a), clause (1), must be credited to the amount of 
72.12 	fire insurance premium tax proceeds available for the next subsequent fire state aid 
72.13 	apportionment.
72.14 	(c) The amount of any overpaid service pension recovered under paragraph (a), 
72.15 	clause (2), must be credited to the amount of fire insurance premium tax proceeds 
72.16 	available for the next subsequent fire state aid apportionment.
72.17 	(d) The determination of the state auditor that a relief association has paid a service 
72.18 	pension greater than the applicable maximum must be made on the basis of the information 
72.19 	filed by the relief association and the municipality with the state auditor under sections 
72.20 	69.011, subdivision 2, and 69.051, subdivision 1 or 1a, whichever applies, and any other 
72.21 	relevant information that comes to the attention of the state auditor. The determination 
72.22 	of the state auditor is final. An aggrieved municipality, relief association, or person may 
72.23 	appeal the determination under section 480A.06.

72.24 	EFFECTIVE DATE. This section is effective July 1, 2009, if article 1, section 
72.25 	21, and article 3, section 9, are enacted.

72.26 	Sec. 7. Minnesota Statutes 2008, section 424A.02, subdivision 8, is amended to read:
72.27 		Subd. 8.Lump-sum service pensions; installment payments. (a) AnyA defined 
72.28 	benefit relief association, if the governing bylaws so provide, may pay, at the option of the 
72.29 	retiring memberintended recipient and in lieu of a single payment of a lump-sum service 
72.30 	pension or survivor benefit, a lump-sum service pension or survivor benefit in installments.
72.31 	(b) The election of installment payments shall beis irrevocable and shallmust be 
72.32 	made by the retiring memberintended recipient in writing and filed with the secretary of 
72.33 	the relief association no later than 30 days prior tobefore the commencement of payment 
72.34 	of the service pension or survivor benefit. The amount of the installment payments shall
72.35 	must be determined so that the present value of the aggregate installment payments 
73.1 	computed at an interest rate of five percent, compounded annually, is equal to the amount 
73.2 	of the single lump-sum payment which would have been made had the installment 
73.3 	payments option not been elected. The payment of each installment shall include interest 
73.4 	at the rate of five percent, compounded annually on the reserve supporting the remaining 
73.5 	installment payments as of the date on which the previous installment payment was paid 
73.6 	and computed from the date on which the previous installment payment was paid to the 
73.7 	date of payment for the current installment payment in any reasonable manner provided 
73.8 	for in the governing bylaws, but the total amount of installment payments may not exceed 
73.9 	the single payment service pension amount plus interest at an annual rate of five percent 
73.10 	on the amount of delayed payments for the period during which payment was delayed.
73.11 	(c) To the extent that the commissioner of commerce deems it to be necessary or 
73.12 	practical, the commissioner may specify and issue procedures, forms or mathematical 
73.13 	tables for use in performing the calculations required pursuant to this subdivision.

73.14 	EFFECTIVE DATE. This section is effective July 1, 2009, if article 1, section 
73.15 	23, and article 3, section 11, are enacted.

73.16 	Sec. 8. Minnesota Statutes 2008, section 424A.02, subdivision 10, is amended to read:
73.17 		Subd. 10.Local approval of bylaw amendments; filing requirements. (a) Each 
73.18 	defined benefit relief association to which this section applies shallmust file a revised 
73.19 	copy of its governing bylaws with the state auditor upon the adoption of any amendment 
73.20 	to its governing bylaws by the relief association or upon the approval of any amendment 
73.21 	to its governing bylaws granted by the governing body of each municipality served by the 
73.22 	fire department to which the relief association is directly associated. Failure of the relief 
73.23 	association to file a copy of the bylaws or any bylaw amendments with the state auditor 
73.24 	shall disqualifydisqualifies the municipality from the distribution of any future fire state 
73.25 	aid until this filing requirement has been completed.
73.26 	(b) If the special fund of the relief association does not have a surplus over full 
73.27 	funding pursuant tounder section 69.772, subdivision 3, clause (2), subclause (e), or 
73.28 	69.773, subdivision 4, and if the municipality is required to provide financial support to 
73.29 	the special fund of the relief association pursuant tounder section 69.772 or 69.773, no 
73.30 	bylaw amendment which would affect the amount of, the manner of payment of, or the 
73.31 	conditions for qualification for service pensions or ancillary benefits or disbursements 
73.32 	other than administrative expenses authorized pursuant tounder section 69.80 payable 
73.33 	from the special fund of the relief association shall beis effective until it has been ratified 
73.34 	by the governing body or bodies of the appropriate municipalities. If the municipality is 
73.35 	not required to provide financial support to the special fund pursuant tounder this section, 
74.1 	the relief association may adopt or amend without municipal ratification its articles 
74.2 	of incorporation or bylaws which increase or otherwise affect the service pensions or 
74.3 	ancillary benefits payable from the special fund so long as the changes do not cause the 
74.4 	amount of the resulting increase in the accrued liability of the special fund to exceed 90 
74.5 	percent of the amount of the prior surplus over full funding reported in the prior year and 
74.6 	the changes do not result in the financial requirements of the special fund exceeding the 
74.7 	expected amount of the futuresubsequent calendar year's fire state aid to be received 
74.8 	by the relief association.
74.9 	(c) If the relief association pays only a lump-sum pension, the financial requirements 
74.10 	are to be determined by the board of trustees following the preparation of an estimate 
74.11 	of the expected increase in the accrued liability and annual accruing liability of the 
74.12 	relief association attributable to the change. If the relief association pays a monthly 
74.13 	benefit service pension, the financial requirements are to be determined by the board of 
74.14 	trustees following either an updated actuarial valuation including the proposed change 
74.15 	or an estimate of the expected actuarial impact of the proposed change prepared by the 
74.16 	actuary of the relief association. If a relief association adopts or amends its articles of 
74.17 	incorporation or bylaws without municipal ratification pursuant tounder this subdivision, 
74.18 	and, subsequent to the amendment or adoption, the financial requirements of the special 
74.19 	fund pursuant tounder this section are such so as to require financial support from the 
74.20 	municipality, the provision which was implemented without municipal ratification shallis 
74.21 	no longer be effective without municipal ratification, and any service pensions or ancillary 
74.22 	benefits payable after that date shallmust be paid only in accordance with the articles of 
74.23 	incorporation or bylaws as amended or adopted with municipal ratification.

74.24 	EFFECTIVE DATE. This section is effective July 1, 2009, if article 1, section 
74.25 	27, and article 3, section 12, are enacted.

74.26 	Sec. 9. Minnesota Statutes 2008, section 424A.04, subdivision 1, is amended to read:
74.27 		Subdivision 1.Membership. (a) A relief association that is directly associated with 
74.28 	a municipal fire department must be managed by a board of trustees consisting of nine 
74.29 	members. Six trustees must be elected from the membership of the relief association and 
74.30 	three trustees must be drawn from the officials of the municipalities served by the fire 
74.31 	department to which the relief association is directly associated. The bylaws of a relief 
74.32 	association which provides a monthly benefit service pension may provide that one of 
74.33 	the six trustees elected from the relief association membership may be a retired member 
74.34 	receiving a monthly pension who is elected by the membership of the relief association. 
74.35 	The three municipal trustees must be one elected municipal official and one elected or 
75.1 	appointed municipal official who are designated as municipal representatives by the 
75.2 	municipal governing board annually and the chief of the municipal fire department.
75.3 	(b) A relief association that is a subsidiary of an independent nonprofit firefighting 
75.4 	corporation must be managed by a board of trustees consisting of nine members. Six 
75.5 	trustees must be elected from the membership of the relief association, two trustees must 
75.6 	be drawn from the officials of the municipalities served by the fire department to which 
75.7 	the relief association is directly associated, and one trustee shallmust be the fire chief 
75.8 	serving with the independent nonprofit firefighting corporation. The bylaws of a relief 
75.9 	association may provide that one of the six trustees elected from the relief association 
75.10 	membership may be a retired member receiving a monthly pension who is elected by the 
75.11 	membership of the relief association. The two municipal trustees must be elected or 
75.12 	appointed municipal officials, selected as follows:
75.13 	(1) if only one municipality contracts with the independent nonprofit firefighting 
75.14 	corporation, the municipal trustees must be two officials of the contracting municipality 
75.15 	who are designated annually by the governing body of the municipality; or
75.16 	(2) if two or more municipalities contract with the independent nonprofit corporation, 
75.17 	the municipal trustees must be one official from each of the two largest municipalities 
75.18 	in population who are designated annually by the governing bodies of the applicable 
75.19 	municipalities.
75.20 	(c) The municipal trustees for a relief association that is directly associated with a 
75.21 	fire department operated as or by a joint powers entity must be the fire chief of the fire 
75.22 	department and two trustees designated annually by the joint powers board. The municipal 
75.23 	trustees for a relief association that is directly associated with a fire department service 
75.24 	area township must be the fire chief of the fire department and two trustees designated by 
75.25 	the township board.
75.26 	(d) If a relief association lacks the municipal board members provided for in 
75.27 	paragraph (a), (b), or (c) because the fire department is not located in or associated with an 
75.28 	organized municipality, joint powers entity, or township, the municipal board members 
75.29 	must be the fire chief of the fire department and two board members appointed from the 
75.30 	fire department service area by the board of commissioners of the applicable county.
75.31 	(e) The term of thesethe appointed municipal board members is one year or until the 
75.32 	person's successor is qualified, whichever is later.
75.33 	(f) A municipal trustee under paragraph (a), (b), (c), or (d) has all the rights 
75.34 	and duties accorded to any other trustee, except the right to be an officer of the relief 
75.35 	association board of trustees.
76.1 	(g) A board must have at least three officers, who are a president, a secretary and a 
76.2 	treasurer. These officers must be elected from among the elected trustees by either the full 
76.3 	board of trustees or by the relief association membership, as specified in the bylaws. In 
76.4 	no event may any trustee hold more than one officer position at any one time. The terms 
76.5 	of the elected trustees and of the officers of the board must be specified in the bylaws of 
76.6 	the relief association, but may not exceed three years. If the term of the elected trustees 
76.7 	exceeds one year, the election of the various trustees elected from the membership must be 
76.8 	staggered on as equal a basis as is practicable.

76.9 	EFFECTIVE DATE. This section is effective July 1, 2009, if article 1, section 
76.10 	32, and article 3, section 13, are enacted.

76.11 	Sec. 10. Minnesota Statutes 2008, section 424A.05, subdivision 3, is amended to read:
76.12 		Subd. 3.Authorized disbursements from the special fund. (a) Disbursements 
76.13 	from the special fund aremay not permitted to be made for any purpose other than one of 
76.14 	the following:
76.15 	(1) for the payment of service pensions to retired members of the relief association if 
76.16 	authorized and paid under law and the bylaws governing the relief association;
76.17 	(2) for the payment of temporary or permanent disability benefits to disabled 
76.18 	members of the relief association if authorized and paid pursuant tounder law and 
76.19 	specified in amount in the bylaws governing the relief association;
76.20 	(3) for the payment of survivor benefits to surviving spouses and surviving children, 
76.21 	or if none, to designated beneficiaries, of deceased members of the relief association, and 
76.22 	if no survivors and if no designated beneficiary, for the payment of a death benefit to the 
76.23 	estate of the deceased active or deferred firefighter, if authorized by and paid pursuant to
76.24 	under law and specified in amount in the bylaws governing the relief association;
76.25 	(4) for the payment of the fees, dues and assessments to the Minnesota State Fire 
76.26 	Department Association,and to the Minnesota Area Relief Association Coalition, and to 
76.27 	the state Volunteer Firefighters Benefit Association in order to entitle relief association 
76.28 	members to membership in and the benefits of these associations or organizations; and
76.29 	(5) for the payment of insurance premiums to the state Volunteer Firefighters Benefit 
76.30 	Association, or an insurance company licensed by the state of Minnesota offering casualty 
76.31 	insurance, in order to entitle relief association members to membership in and the benefits 
76.32 	of the association or organization; and
76.33 	(5)(6) for the payment of administrative expenses of the relief association as 
76.34 	authorized under section 69.80. 
77.1 	(b) For purposes of this chapter, for a monthly benefit volunteer fire relief association 
77.2 	or for a combination lump-sum and monthly benefit volunteer fire relief association where 
77.3 	a monthly benefit service pension has been elected by or a monthly benefit is payable with 
77.4 	respect to a firefighter, a designated beneficiary must be a natural person. For purposes of 
77.5 	this chapter, for a defined contribution volunteer fire relief association, for a lump-sum 
77.6 	volunteer fire relief association, or for a combination lump-sum and monthly benefit 
77.7 	volunteer fire relief association where a lump-sum service pension has been elected by 
77.8 	or a lump-sum benefit is payable with respect to a firefighter, a designated beneficiary 
77.9 	may be a trust created under chapter 501B.

77.10 	EFFECTIVE DATE. This section is effective July 1, 2009, if article 1, section 
77.11 	32, and article 3, section 13, are enacted.

77.12 	Sec. 11. Minnesota Statutes 2008, section 424A.08, is amended to read:
77.13 	424A.08 MUNICIPALITY WITHOUT RELIEF ASSOCIATION; 
77.14 	AUTHORIZED DISBURSEMENTS.
77.15 	(a) Any qualified municipality which is entitled to receive fire state aid but which 
77.16 	has no volunteer firefighters' relief association directly associated with its fire department 
77.17 	and which has no full-time firefighters with retirement coverage by the public employees 
77.18 	police and fire retirement plan shall deposit the fire state aid in a special account 
77.19 	established for that purpose in the municipal treasury. Disbursement from the special 
77.20 	account shallmay not be made for any purpose except:
77.21 	(1) payment of the fees, dues and assessments to the Minnesota State Fire 
77.22 	Department Association and to the state Volunteer Firefighters' Benefit Association in 
77.23 	order to entitle its firefighters to membership in and the benefits of these state associations;
77.24 	(2) payment of the cost of purchasing and maintaining needed equipment for the 
77.25 	fire department; and
77.26 	(3) payment of the cost forof construction, acquisition, repair and, or maintenance 
77.27 	of buildings or other premises to house the equipment of the fire department.
77.28 	(b) A qualified municipality which is entitled to receive fire state aid, which has no 
77.29 	volunteer firefighters' relief association directly associated with its fire department and 
77.30 	which has full-time firefighters with retirement coverage by the public employees police 
77.31 	and fire retirement plan may disburse the fire state aid as provided in paragraph (a), for the 
77.32 	payment of the employer contribution requirement with respect to firefighters covered by 
77.33 	the public employees police and fire retirement plan under section 353.65, subdivision 3, 
77.34 	or for a combination of the two types of disbursements.

78.1 	EFFECTIVE DATE. This section is effective July 1, 2009, if article 1, section 
78.2 	39, and article 3, section 15, are enacted.

78.3 	Sec. 12. Minnesota Statutes 2008, section 424A.10, subdivision 1, is amended to read:
78.4 		Subdivision 1. Definitions. For purposes of this section: 
78.5 	(1) "qualified recipient" means an individual who receives a lump-sum distribution 
78.6 	of pension or retirement benefits from a volunteer firefighters' relief association for service 
78.7 	that the individual has performed as a volunteer firefighter;
78.8 	(2) "survivor of a deceased active or deferred volunteer firefighter" means the legally 
78.9 	marriedsurviving spouse of a deceased active or deferred volunteer firefighter under 
78.10 	section 424A.001, subdivision 6, or, if none, the surviving minor child or minor children 
78.11 	of a deceased active or deferred volunteer firefighter; 
78.12 	(3) "active volunteer firefighter" means a person who regularly renders fire 
78.13 	suppression service for a municipal fire department or an independent nonprofit firefighting 
78.14 	corporation, who has met the statutory and other requirements for relief association 
78.15 	membership, and who has beenis deemed by the relief association under law and its 
78.16 	bylaws to be a fully qualified member of the relief association for at least one month; and
78.17 	(4) "deferred volunteer firefighter" means a former active volunteer firefighter who 
78.18 	terminated active firefighting service, has sufficient service credit from the applicable relief 
78.19 	association to be entitled to a service pension under the bylaws of the relief association, 
78.20 	but has not applied for or has not received the service pension.

78.21 	EFFECTIVE DATE. This section is effective July 1, 2009, if article 1, section 
78.22 	40, and article 3, section 16, are enacted.

78.23 	Sec. 13.  REPEALER.
 78.24 	Minnesota Statutes 2008, section 424A.02, subdivision 9b, is repealed.

78.25 	EFFECTIVE DATE. This section is effective July 1, 2009, if article 1, section 
78.26 	26, is enacted.