HF 1951

2nd Unofficial Engrossment - 88th Legislature (2013 - 2014)

Posted on 05/01/2014 03:35 p.m.

1.1A bill for an act 1.2relating to retirement; various Minnesota public employee retirement plans; 1.3allowing MSRS-General deferred members to vote in board elections; 1.4continuing Stevens County Housing and Redevelopment Authority employees 1.5in PERA-General; excluding fixed-route bus drivers employed by the St. 1.6Cloud Metropolitan Transit Commission from PERA-General coverage; 1.7increasing member and employer contribution rates for certain retirement 1.8plans; providing for the consolidation of the Duluth Teachers Retirement Fund 1.9Association retirement plan and fund into the statewide Teachers Retirement 1.10Association; revising an amortization target date, creating new state aid 1.11programs; appropriating money; extending a MnSCU early retirement incentive 1.12program; increasing the limit for certain reemployed MnSCU retirees; extending 1.13the applicability of a second chance at tenure retirement coverage election 1.14opportunity for MnSCU faculty members; revising investment authority for 1.15various defined contribution plans or programs; authorizing the State Board of 1.16Investment to revise, remove, or create investment options for the Minnesota 1.17supplemental investment fund; expanding permissible investments under the 1.18unclassified state employees retirement program, the public employees defined 1.19contribution plan, the deferred compensation program, and the health care savings 1.20plan; revising salary reporting requirements; clarifying retirement provision 1.21applications to sheriffs; revising local government postretirement option program 1.22requirements and extending expiration date; clarifying future postretirement 1.23adjustment rates for former members of the former Minneapolis Firefighters 1.24Relief Association and the former Minneapolis Police Relief Association; making 1.25technical changes to amortization state aid and supplemental state aid; clarifying 1.26the eligibility of independent nonprofit firefighting corporations to receive police 1.27and fire supplemental retirement state aid; implementing the recommendations 1.28of the 2013-2014 state auditor volunteer fire working group; modifying the 1.29disability benefit application deadline for certain former Wadena County sheriff's 1.30deputies; authorizing city of Duluth and Duluth Airports Authority employee 1.31salary-supplement payments coverage following Court of Appeals decision; 1.32specifying interest rate for computing joint and survivor annuities; revising 1.33postretirement adjustment triggers; revising reemployed annuitant withholding in 1.34certain divorce situations; clarifying medical advisor and resumption of teaching 1.35provisions; specifying explicit postretirement adjustment assumptions; allowing 1.36volunteer firefighter relief associations to pay state fire chiefs association dues 1.37from the special fund; authorizing MnSCU employee to elect TRA coverage and 1.38transfer past service from IRAP to TRA; clarifying the applicability of 2013 1.39postretirement adjustment modifications to certain county sheriffs; ratifying or 2.1grandparenting MSRS-Correctional plan coverage for Department of Human 2.2Services employees; allowing various service credit purchases; requiring a 2.3PERA report on certain survivor benefit amounts;amending Minnesota Statutes 2.42012, sections 3A.01, subdivision 1a; 11A.17, subdivisions 1, 9; 13.632, 2.5subdivision 1; 122A.18, subdivision 7a; 136F.481; 352.01, subdivisions 2b, 2.612; 352.03, subdivision 1, by adding a subdivision; 352.04, subdivisions 2, 2.73; 352.115, subdivisions 8, 10; 352.1155, subdivisions 1, 4; 352.90; 352.91, 2.8subdivisions 1, 2, 3c, 3d, 3e, 3f, by adding a subdivision; 352.92, subdivisions 2.91, 2; 352.965, subdivision 4, by adding subdivisions; 352.98, subdivision 2; 2.10352B.08, subdivision 3; 352D.04, by adding subdivisions; 353.01, subdivision 2.1114; 353.27, subdivisions 2, 3, 3b, 4, by adding a subdivision; 353.30, subdivision 2.123; 353.37, by adding a subdivision; 353.371, by adding a subdivision; 353.6511, 2.13subdivision 7; 353.6512, subdivision 7; 353D.05, subdivision 1, by adding a 2.14subdivision; 354.05, subdivisions 2, 7, 13; 354.42, subdivisions 2, 3; 354.44, 2.15subdivision 5; 354.445; 354.48, subdivision 6a; 354A.011, subdivisions 11, 15a, 2.1627; 354A.021, subdivision 1; 354A.092; 354A.093, subdivision 1; 354A.096; 2.17354A.12, subdivision 2; 354A.29, subdivision 8; 354A.31, subdivisions 1, 2.183a; 354A.32, subdivision 1; 354A.35, subdivision 1; 354A.37, subdivisions 2.193, 4; 354A.39; 354A.41; 354B.21, subdivisions 2, 3a; 355.01, subdivision 2.202c; 356.215, subdivision 11; 356.24, subdivision 1; 356.302, subdivision 2.217; 356.303, subdivision 4; 356.32, subdivision 2; 356.415, subdivision 1d; 2.22356.42, subdivision 3; 356.465, subdivision 3; 356.47, subdivision 3; 356.635, 2.23subdivision 6; 356.99, subdivision 1; 356A.06, subdivisions 7, 7a; 424A.015, 2.24by adding a subdivision; 424A.016, subdivisions 4, 7; 424A.05, subdivision 2.253; 424A.08; 424B.12; 490.121, subdivision 2a; Minnesota Statutes 2013 2.26Supplement, sections 69.051, subdivisions 1a, 3; 352.01, subdivision 2a; 352.03, 2.27subdivision 4; 353.01, subdivisions 2a, 2b; 353.651, subdivision 4; 354.436; 2.28354.44, subdivision 6; 354A.12, subdivisions 1, 2a, 3a, 3c; 354A.27, subdivision 2.296a; 356.20, subdivision 2; 356.214, subdivision 1; 356.215, subdivision 8; 2.30356.219, subdivision 8; 356.30, subdivision 3; 356.401, subdivision 3; 356.415, 2.31subdivisions 1a, 1c, 1e, 1f; 356.91; 363A.36, subdivision 1; 423A.02, subdivision 2.323; 423A.022, subdivisions 2, 3; 424A.016, subdivision 6; 424A.02, subdivisions 2.333, 7; 424A.092, subdivision 6; 424A.093, subdivisions 2, 6; 424A.094, 2.34subdivision 2; 424A.10, subdivision 2; Laws 2009, chapter 169, article 5, 2.35section 2, as amended; article 6, section 1; proposing coding for new law in 2.36Minnesota Statutes, chapters 354; 354A; 356; repealing Minnesota Statutes 2012, 2.37sections 11A.17, subdivision 4; 352.965, subdivision 5; 352D.04, subdivision 1; 2.38353D.05, subdivision 2; 354A.021, subdivision 5; 354A.108; 354A.24; 354A.27, 2.39subdivision 5; 356.415, subdivision 3; Minnesota Statutes 2013 Supplement, 2.40sections 354A.27, subdivisions 6a, 7; 354A.31, subdivision 4a. 2.41BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 2.42ARTICLE 1 2.43RETIREMENT PLAN MEMBERSHIP INCLUSIONS AND EXCLUSIONS 2.44    Section 1. Minnesota Statutes 2013 Supplement, section 352.01, subdivision 2a, 2.45is amended to read: 2.46    Subd. 2a. Included employees. (a) "State employee" includes: 2.47    (1) employees of the Minnesota Historical Society; 2.48    (2) employees of the State Horticultural Society; 2.49    (3) employees of the Minnesota Crop Improvement Association; 3.1    (4) employees of the adjutant general whose salaries are paid from federal funds and 3.2who are not covered by any federal civilian employees retirement system; 3.3    (5) employees of the Minnesota State Colleges and Universities who are employed 3.4under the university or college activities program; 3.5    (6) currently contributing employees covered by the system who are temporarily 3.6employed by the legislature during a legislative session or any currently contributing 3.7employee employed for any special service as defined in subdivision 2b, clause (8); 3.8    (7) employees of the legislature who are appointed without a limit on the duration 3.9of their employment and persons employed or designated by the legislature or by a 3.10legislative committee or commission or other competent authority to conduct a special 3.11inquiry, investigation, examination, or installation; 3.12    (8) trainees who are employed on a full-time established training program 3.13performing the duties of the classified position for which they will be eligible to receive 3.14immediate appointment at the completion of the training period; 3.15    (9) employees of the Minnesota Safety Council; 3.16    (10) any employees who are on authorized leave of absence from the Transit 3.17Operating Division of the former Metropolitan Transit Commission and who are employed 3.18by the labor organization which is the exclusive bargaining agent representing employees 3.19of the Transit Operating Division; 3.20    (11) employees of the Metropolitan Council, Metropolitan Parks and Open Space 3.21Commission, Metropolitan Sports Facilities Commission, or Metropolitan Mosquito 3.22Control Commission unless excluded under subdivision 2b or are covered by another 3.23public pension fund or plan under section 473.415, subdivision 3; 3.24    (12) judges of the Tax Court; 3.25    (13) personnel who were employed on June 30, 1992, by the University of 3.26Minnesota in the management, operation, or maintenance of its heating plant facilities, 3.27whose employment transfers to an employer assuming operation of the heating plant 3.28facilities, so long as the person is employed at the University of Minnesota heating plant 3.29by that employer or by its successor organization; 3.30    (14) personnel who are employed as seasonal employees in the classified or 3.31unclassified service; 3.32    (15) persons who are employed by the Department of Commerce as a peace officer 3.33in the Commerce Fraud Bureau under section 45.0135 who have attained the mandatory 3.34retirement age specified in section 43A.34, subdivision 4; 3.35    (16) employees of the University of Minnesota unless excluded under subdivision 3.362b, clause (3); 4.1    (17) employees of the Middle Management Association whose employment began 4.2after July 1, 2007, and to whom section 352.029 does not apply; 4.3    (18) employees of the Minnesota Government Engineers Council to whom section 4.4352.029 does not apply; 4.5(19) employees of the Minnesota Sports Facilities Authority; and 4.6(20) employees of the Minnesota Association of Professional Employees. new text begin ; new text end 4.7 new text begin (21) employees of the Minnesota State Retirement System; new text end 4.8 new text begin (22) employees of the State Agricultural Society; new text end 4.9 new text begin (23) employees of the Gillette Children's Hospital Board who were employed in the new text end 4.10 new text begin state unclassified service at the former Gillette Children's Hospital on March 28, 1974; and new text end 4.11 new text begin (24) if approved for coverage by the Board of Directors of Conservation Corps new text end 4.12 new text begin Minnesota, employees of Conservation Corps Minnesota so employed on June 30, 2003. new text end 4.13    (b) Employees specified in paragraph (a), clause (13), are included employees under 4.14paragraph (a) if employer and employee contributions are made in a timely manner in the 4.15amounts required by section 352.04. Employee contributions must be deducted from 4.16salary. Employer contributions are the sole obligation of the employer assuming operation 4.17of the University of Minnesota heating plant facilities or any successor organizations to 4.18that employer. 4.19 new text begin EFFECTIVE DATE. new text end new text begin This section is effective July 1, 2014. new text end 4.20    Sec. 2. Minnesota Statutes 2012, section 352.01, subdivision 2b, is amended to read: 4.21    Subd. 2b. Excluded employees. "State employee" does not include: 4.22    (1) new text begin persons who are: new text end 4.23     new text begin (i) new text end students who are employed by the University of Minnesota, or new text begin within new text end the 4.24 new text begin Minnesota new text end State Colleges and Universities new text begin system new text end , unless approved for coverage by 4.25the Board of Regents of the University of Minnesota or the Board of Trustees of the 4.26Minnesota State Colleges and Universities, whichever is applicable new text begin applies new text end ; 4.27 new text begin (ii) employed as interns for a period not to exceed six months unless included under new text end 4.28 new text begin subdivision 2a, paragraph (a), clause (8); new text end 4.29 new text begin (iii) employed as trainee employees unless included under subdivision 2a, paragraph new text end 4.30 new text begin (a), clause (8); or new text end 4.31 new text begin (iv) employed in the student worker classification as designated by Minnesota new text end 4.32 new text begin Management and Budget; new text end 4.33    (2) employees who are new text begin : new text end 4.34     new text begin (i) new text end eligible for membership in the state Teachers Retirement Association, except 4.35employees new text begin unless the person is an employee new text end of the Department of Education who have 5.1chosen or may choose new text begin elected new text end to be covered by the general state employees retirement plan 5.2of the Minnesota State Retirement System instead of the Teachers Retirement Association; 5.3     new text begin (ii) employees of the state who, in any year, were credited with 12 months of new text end 5.4 new text begin allowable service as a public school teacher and, as such, are members of a retirement plan new text end 5.5 new text begin governed by chapter 354 or 354A unless the employment is incidental employment as a new text end 5.6 new text begin state employee that is not covered by a retirement plan governed by chapter 354 or 354A; new text end 5.7     new text begin (iii) employees of the state who are employed by the Board of Trustees of the new text end 5.8 new text begin Minnesota State Colleges and Universities in an unclassified position that is listed in new text end 5.9 new text begin section 43A.08, subdivision 1, clause (9); new text end 5.10     new text begin (iv) persons employed by the Board of Trustees of the Minnesota State Colleges and new text end 5.11 new text begin Universities who elected retirement coverage other than by the general state employees new text end 5.12 new text begin retirement plan of the Minnesota State Retirement System under Minnesota Statutes new text end 5.13 new text begin 1994, section 136C.75; new text end 5.14     new text begin (v) officers or enlisted personnel in the National Guard or in the naval militia who new text end 5.15 new text begin are assigned to permanent peacetime duty and who are or are required to be members of a new text end 5.16 new text begin federal retirement system under federal law; new text end 5.17     new text begin (vi) persons employed by the Department of Military Affairs as full-time firefighters new text end 5.18 new text begin and who, as such, are members of the public employees police and fire retirement plan; new text end 5.19     new text begin (vii) members of the State Patrol retirement plan under section 352B.011, new text end 5.20 new text begin subdivision 10; new text end 5.21     new text begin (viii) off-duty police officers while employed by the Metropolitan Council and new text end 5.22 new text begin persons employed as full-time police officers by the Metropolitan Council and who, as new text end 5.23 new text begin such, are members of the public employees police and fire retirement plan; and new text end 5.24     new text begin (ix) employees of the state who have elected to transfer account balances derived new text end 5.25 new text begin from state service to the unclassified state employees retirement program under section new text end 5.26 new text begin 352D.02, subdivision 1d; new text end 5.27    (3) employees of the University of Minnesota who are excluded from coverage by 5.28action of the Board of Regents; 5.29    (4) officers and enlisted personnel in the National Guard and the naval militia who 5.30are assigned to permanent peacetime duty and who under federal law are or are required to 5.31be members of a federal retirement system; 5.32    (5) new text begin (4) new text end election officers new text begin judges and persons who are employed solely to administer new text end 5.33 new text begin elections new text end ; 5.34    (6) new text begin (5) new text end persons who are new text begin : new text end 5.35     new text begin (i) new text end engaged in public work for the state but who are employed by contractors when the 5.36performance of the contract is authorized by the legislature or other competent authority; 6.1    (7) officers and employees of the senate, or of the house of representatives, or of a 6.2legislative committee or commission who are temporarily employed; 6.3 new text begin (ii) employed to perform professional services where the service is incidental to the new text end 6.4 new text begin person's regular professional duties and where compensation is paid on a per diem basis; or new text end 6.5 new text begin (iii) compensated on a fee payment basis or as an independent contractor; new text end 6.6 new text begin (6) persons who are employed: new text end 6.7 new text begin (i) on a temporary basis by the house of representatives, the senate, or a legislative new text end 6.8 new text begin commission or agency under the jurisdiction of the Legislative Coordinating Commission; new text end 6.9 new text begin (ii) as a temporary employee on or after July 1 for a period ending on or before new text end 6.10 new text begin October 15 of that calendar year for the Minnesota State Agricultural Society or the new text end 6.11 new text begin Minnesota State Fair, or as an employee at any time for a special event held on the new text end 6.12 new text begin fairgrounds; new text end 6.13 new text begin (iii) by the executive branch as a temporary employee in the classified service or new text end 6.14 new text begin as an executive branch temporary employee in the unclassified service if appointed for a new text end 6.15 new text begin definite period not to exceed six months, and if employment is less than six months, then new text end 6.16 new text begin in any 12-month period; new text end 6.17 new text begin (iv) by the adjutant general if employed on an unlimited intermittent or temporary new text end 6.18 new text begin basis in the classified service or in the unclassified service for the support of Army or Air new text end 6.19 new text begin National Guard training facilities; new text end 6.20 new text begin (v) by a state or federal program for training or rehabilitation as a temporary new text end 6.21 new text begin employee if employed for a limited period from an area of economic distress and if other new text end 6.22 new text begin than a skilled or supervisory personnel position or other than a position that has civil new text end 6.23 new text begin service status covered by the retirement system; and new text end 6.24 new text begin (vi) by the Metropolitan Council or a statutory board of the Metropolitan Council new text end 6.25 new text begin where the members of the board are appointed by the Metropolitan Council as a temporary new text end 6.26 new text begin employee if the appointment does not exceed six months; new text end 6.27    (8) new text begin (7) new text end receivers, jurors, notaries public, and court employees who are not in the 6.28judicial branch as defined in section 43A.02, subdivision 25, except referees and adjusters 6.29employed by the Department of Labor and Industry; 6.30    (9) new text begin (8) new text end patient and inmate help who perform services in state charitable, penal, and 6.31correctional institutions new text begin , new text end including the new text begin a new text end Minnesota Veterans Home; 6.32    (10) persons who are employed for professional services where the service is 6.33incidental to their regular professional duties and whose compensation is paid on a per 6.34diem basis; 6.35    (11) new text begin (9) new text end employees of the Sibley House Association; 6.36 new text begin (10) persons who are: new text end 7.1    (12) the new text begin (i) new text end members of any state board or commission who serve the state 7.2intermittently and are paid on a per diem basis; new text begin , new text end the secretary, secretary-treasurer, and 7.3treasurer of those boards if their compensation is $5,000 or less per year, or, if they are 7.4legally prohibited from serving more than three years; new text begin , new text end and the board of managers of the 7.5State Agricultural Society and its treasurer unless the treasurer is also its full-time secretary; 7.6    (13) state troopers and persons who are described in section 352B.011, subdivision 7.710 , clauses (2) to (8); 7.8    (14) temporary employees of the Minnesota State Fair who are employed on or 7.9after July 1 for a period not to extend beyond October 15 of that year; and persons who 7.10are employed at any time by the state fair administration for special events held on the 7.11fairgrounds; 7.12 new text begin (ii) examination monitors employed by a department, agency, commission, or board new text end 7.13 new text begin of the state to conduct examinations that are required by law; or new text end 7.14 new text begin (iii) appointees serving as a member of a fact-finding commission or an adjustment new text end 7.15 new text begin panel, an arbitrator, or a labor referee under chapter 179; new text end 7.16    (15) new text begin (11) new text end emergency employees who are in the classified service; except that new text begin , new text end 7.17 new text begin but new text end if an emergency employee, within the same pay period, becomes a provisional or 7.18probationary employee on other than a temporary basis, the employee must be considered 7.19a "state employee" retroactively to the beginning of the pay period; 7.20    (16) temporary employees in the classified service, and temporary employees in the 7.21unclassified service who are appointed for a definite period of not more than six months 7.22and who are employed less than six months in any one-year period; 7.23    (17) interns who are hired for six months or less and trainee employees, except 7.24those listed in subdivision 2a, clause (8); 7.25    (18) persons whose compensation is paid on a fee basis or as an independent 7.26contractor; 7.27    (19) state employees who are employed by the Board of Trustees of the Minnesota 7.28State Colleges and Universities in unclassified positions enumerated in section 43A.08, 7.29subdivision 1 , clause (9); 7.30    (20) state employees who in any year have credit for 12 months service as teachers 7.31in the public schools of the state and as teachers are members of the Teachers Retirement 7.32Association or a retirement system in St. Paul, Minneapolis, or Duluth, except for 7.33incidental employment as a state employee that is not covered by one of the teacher 7.34retirement associations or systems; 8.1    (21) employees of the adjutant general who are employed on an unlimited 8.2intermittent or temporary basis in the classified or unclassified service for the support of 8.3Army and Air National Guard training facilities; 8.4    (22) chaplains and nuns new text begin (12) persons who are members of a religious order new text end who are 8.5excluded from coverage under the federal Old Age, Survivors, Disability, and Health 8.6Insurance Program for the performance of service as specified in United States Code, title 8.742, section 410(a)(8)(A), as amended, if no irrevocable election of coverage has been 8.8made under section 3121(r) of the Internal Revenue Code of 1986, as amended through 8.9December 31, 1992; 8.10    (23) examination monitors who are employed by departments, agencies, 8.11commissions, and boards to conduct examinations required by law; 8.12    (24) persons who are appointed to serve as members of fact-finding commissions or 8.13adjustment panels, arbitrators, or labor referees under chapter 179; 8.14    (25) temporary employees who are employed for limited periods under any state or 8.15federal program for training or rehabilitation, including persons who are employed for 8.16limited periods from areas of economic distress, but not including skilled and supervisory 8.17personnel and persons having civil service status covered by the system; 8.18    (26) full-time students who are employed by the Minnesota Historical Society 8.19intermittently during part of the year and full-time during the summer months; 8.20    (27) temporary employees who are appointed for not more than six months, of 8.21the Metropolitan Council and of any of its statutory boards, if the board members are 8.22appointed by the Metropolitan Council; 8.23    (28) persons who are employed in positions designated by the Department of 8.24Management and Budget as student workers; 8.25    (29) new text begin (13) new text end members of trades who are employed by the successor to the Metropolitan 8.26Waste Control Commission, who have trade union pension plan coverage under a 8.27collective bargaining agreement, and who are first employed after June 1, 1977; 8.28    (30) off-duty peace officers while employed by the Metropolitan Council; 8.29    (31) persons who are employed as full-time police officers by the Metropolitan 8.30Council and as police officers are members of the public employees police and fire fund; 8.31    (32) persons who are employed as full-time firefighters by the Department of Military 8.32Affairs and as firefighters are members of the public employees police and fire fund; 8.33    (33) new text begin (14) new text end foreign citizens who are employed under a work permit of less than three 8.34years, or new text begin under new text end an H-1b/JV new text begin H-1b visa or a J-1 new text end visa new text begin that is initially new text end valid for less than three 8.35years of employment, unless notice of new text begin a visa new text end extension is supplied which allows them to 8.36work for three or more years as of the date that the extension is granted new text begin and is supplied to new text end 9.1 new text begin the retirement plan new text end , in which case they are new text begin the person is new text end eligible for coverage from the date 9.2extended new text begin of the extension new text end ; new text begin and new text end 9.3    (34) persons who are employed by the Board of Trustees of the Minnesota State 9.4Colleges and Universities and who elected to remain members of the Public Employees 9.5Retirement Association or of the MERF division of the Public Employees Retirement 9.6Association as the successor of the Minneapolis Employees Retirement Fund, whichever 9.7applies, under Minnesota Statutes 1994, section ; and 9.8(35) employees who have elected to transfer service to the unclassified program 9.9under section 352D.02, subdivision 1d. 9.10 new text begin (15) reemployed annuitants of the general state employees retirement plan, the new text end 9.11 new text begin military affairs personnel retirement plan, the transportation department pilots retirement new text end 9.12 new text begin plan, the state fire marshal employees retirement plan, or the correctional state employees new text end 9.13 new text begin retirement plan during the course of that reemployment. new text end 9.14 new text begin EFFECTIVE DATE. new text end new text begin This section is effective July 1, 2014. new text end 9.15    Sec. 3. Minnesota Statutes 2013 Supplement, section 353.01, subdivision 2a, is 9.16amended to read: 9.17    Subd. 2a. Included employees; mandatory membership. (a) Public employees 9.18whose new text begin annual new text end salary exceeds $425 in any month new text begin from one governmental subdivision is new text end 9.19 new text begin stipulated in advance to exceed $5,100 if the person is not a school year employee or new text end 9.20 new text begin $3,800 if the person is a school year employee new text end and who are not specifically excluded under 9.21subdivision 2b or who have not been provided an option to participate under subdivision 9.222d, whether individually or by action of the governmental subdivision, must participate as 9.23members of the association with retirement coverage by the general employees retirement 9.24plan under this chapter, the public employees police and fire retirement plan under this 9.25chapter, or the local government correctional employees retirement plan under chapter 9.26353E, whichever applies. Membership commences as a condition of their employment on 9.27the first day of their employment or on the first day that the eligibility criteria are met, 9.28whichever is later. Public employees include but are not limited to: 9.29(1) persons whose salary meets the threshold in this paragraph from employment in 9.30one or more positions within one governmental subdivision; 9.31(2) elected county sheriffs; 9.32(3) persons who are appointed, employed, or contracted to perform governmental 9.33functions that by law or local ordinance are required of a public officer, including, but 9.34not limited to: 9.35(i) town and city clerk or treasurer; 10.1(ii) county auditor, treasurer, or recorder; 10.2(iii) city manager as defined in section 353.028 who does not exercise the option 10.3provided under subdivision 2d; or 10.4(iv) emergency management director, as provided under section 12.25; 10.5(4) physicians under section 353D.01, subdivision 2, who do not elect public 10.6employees defined contribution plan coverage under section 353D.02, subdivision 2; 10.7(5) full-time employees of the Dakota County Agricultural Society; 10.8(6) employees of the Red Wing Port Authority who were first employed by the 10.9Red Wing Port Authority before May 1, 2011, and who are not excluded employees 10.10under subdivision 2b; and 10.11(7) employees of the Seaway Port Authority of Duluth who are not excluded 10.12employees under subdivision 2b. 10.13 new text begin (8) employees of the Stevens County Housing and Redevelopment Authority who new text end 10.14 new text begin were first employed by the Stevens County Housing and Redevelopment Authority before new text end 10.15 new text begin May 1, 2014, and who are not excluded employees under subdivision 2b; and new text end 10.16 new text begin (9) employees of the Public Employees Retirement Association. new text end 10.17    (b) A public employee or elected official who was a member of the association on 10.18June 30, 2002, based on employment that qualified for membership coverage by the public 10.19employees retirement plan or the public employees police and fire plan under this chapter, 10.20or the local government correctional employees retirement plan under chapter 353E as of 10.21June 30, 2002, retains that membership for the duration of the person's employment in that 10.22position or incumbency in elected office. Except as provided in subdivision 28, the person 10.23shall participate as a member until the employee or elected official terminates public 10.24employment under subdivision 11a or terminates membership under subdivision 11b. 10.25    (c) If new text begin in any subsequent year new text end the new text begin annual new text end salary of an included public employee is 10.26less than $425 in any subsequent month new text begin the minimum salary threshold specified in this new text end 10.27 new text begin subdivision new text end , the member retains membership eligibility. 10.28(d) For the purpose of participation in the MERF division of the general employees 10.29retirement plan, public employees include employees who were members of the former 10.30Minneapolis Employees Retirement Fund on June 29, 2010, and who participate as 10.31members of the MERF division of the association. 10.32 new text begin EFFECTIVE DATE. new text end new text begin The amendments to paragraphs (b) and (d) are effective the new text end 10.33 new text begin day following final enactment. The amendments to paragraphs (a) and (c) are effective new text end 10.34 new text begin January 1, 2015. new text end 11.1    Sec. 4. Minnesota Statutes 2013 Supplement, section 353.01, subdivision 2b, is 11.2amended to read: 11.3    Subd. 2b. Excluded employees. (a) The following public employees are not eligible 11.4to participate as members of the association with retirement coverage by the general 11.5employees retirement plan, the local government correctional employees retirement plan 11.6under chapter 353E, or the public employees police and fire retirement plan: 11.7    (1) persons whose new text begin annual new text end salary from one governmental subdivision never exceeds 11.8 new text begin an amount, stipulated in writing in advance, of $5,100 if the person is not a school year new text end 11.9 new text begin employee or $3,800 if the person is a school year employee. If annual compensation from new text end 11.10 new text begin one governmental subdivision to an employee exceeds the stipulated amount in a calendar new text end 11.11 new text begin year or a school year, whichever applies, after being stipulated in advance not to exceed new text end 11.12 new text begin the applicable amount, the stipulation is no longer valid and contributions must be made new text end 11.13 new text begin on behalf of the employee under section 353.27, subdivision 12, from the first month in new text end 11.14 new text begin which the employee received salary exceeding new text end $425 in a month; 11.15(2) public officers who are elected to a governing body, city mayors, or persons who 11.16are appointed to fill a vacancy in an elective office of a governing body, whose term of office 11.17commences on or after July 1, 2002, for the service to be rendered in that elective position; 11.18    (3) election officers or election judges new text begin and persons employed solely to administer new text end 11.19 new text begin elections new text end ; 11.20    (4) patient and inmate personnel who perform services for a governmental 11.21subdivision; 11.22    (5) except as otherwise specified in subdivision 12a, employees who are hired for 11.23 new text begin employed solely in new text end a temporary position as defined under subdivision 12a, and employees 11.24who resign from a nontemporary position and accept a temporary position within 30 days 11.25 new text begin of that resignation new text end in the same governmental subdivision; 11.26    (6) employees who are employed by reason of work emergency caused by fire, 11.27flood, storm, or similar disaster new text begin , but if the person becomes a probationary or provisional new text end 11.28 new text begin employee within the same pay period, other than on a temporary basis, the person is a new text end 11.29 new text begin "public employee" retroactively to the beginning of the pay period new text end ; 11.30    (7) employees who by virtue of their employment in one governmental subdivision 11.31are required by law to be a member of and to contribute to any of the plans or funds 11.32administered by the Minnesota State Retirement System, the Teachers Retirement 11.33Association, the Duluth Teachers Retirement Fund Association, and new text begin or new text end the St. Paul 11.34Teachers Retirement Fund Association. new text begin , but new text end this clause new text begin exclusion new text end must not be construed 11.35to prevent a person from being a member of and contributing to the Public Employees 11.36Retirement Association and also belonging to and contributing to another public pension 12.1plan or fund for other service occurring during the same period of time. new text begin , and new text end a person who 12.2meets the definition of "public employee" in subdivision 2 by virtue of other service 12.3occurring during the same period of time becomes a member of the association unless 12.4contributions are made to another public retirement fund new text begin plan new text end on the salary based on the 12.5other service or to the Teachers Retirement Association by a teacher as defined in section 12.6354.05, subdivision 2 ; 12.7    (8) persons who are members of a religious order and are excluded from coverage 12.8under the federal Old Age, Survivors, Disability, and Health Insurance Program for the 12.9performance of service as specified in United States Code, title 42, section 410(a)(8)(A), 12.10as amended through January 1, 1987, if no irrevocable election of coverage has been made 12.11under section 3121(r) of the Internal Revenue Code of 1954, as amended; 12.12    (9) employees of new text begin persons who are: new text end 12.13     new text begin (i) employed by new text end a governmental subdivision who have not reached the age of 23 12.14and new text begin who new text end are enrolled on a full-time basis to attend or are attending classes on a full-time 12.15basis at an accredited school, college, or university in an undergraduate, graduate, or 12.16professional-technical program, or new text begin at new text end a public or charter high school; 12.17    (10) new text begin (ii) employed as new text end resident physicians, medical interns, and pharmacist residents 12.18and new text begin , or new text end pharmacist interns who new text begin and new text end are serving in a degree or residency program in new text begin a new text end 12.19public hospitals new text begin hospital new text end or clinics new text begin in a public clinic new text end ; new text begin or new text end 12.20    (11) new text begin (iii) new text end students who are serving for up new text begin a period not new text end to new text begin exceed new text end five years in an 12.21internship or new text begin a new text end residency program new text begin that is new text end sponsored by a governmental subdivision, 12.22including an accredited educational institution; 12.23    (12) new text begin (10) new text end persons who hold a part-time adult supplementary technical college license 12.24who render part-time teaching service in a technical college; 12.25    (13) new text begin (11) new text end except for employees of Hennepin County or new text begin employees of new text end Hennepin 12.26Healthcare System, Inc., foreign citizens who are employed by a governmental subdivision 12.27under a work permit, or new text begin under new text end an H-1b visa initially issued or extended for a combined 12.28period new text begin of new text end less than three years of employment. new text begin but new text end upon extension of the employment 12.29 new text begin of the visa new text end beyond the three-year period, the foreign citizens new text begin citizen new text end must be reported 12.30for membership beginning new text begin on new text end the first of the month thereafter provided new text begin following the new text end 12.31 new text begin extension if new text end the monthly earnings threshold as provided under subdivision 2a is met; 12.32    (14) new text begin (12) new text end public hospital employees who elected not to participate as members 12.33of the association before 1972 and who did not elect to participate from July 1, 1988, 12.34to October 1, 1988; 12.35    (15) new text begin (13) new text end except as provided in section 353.86, volunteer ambulance service 12.36personnel, as defined in subdivision 35, but persons who serve as volunteer ambulance 13.1service personnel may still qualify as public employees under subdivision 2 and may 13.2be members of the Public Employees Retirement Association and participants in the 13.3general employees retirement plan or the public employees police and fire plan, whichever 13.4applies, on the basis of compensation received from public employment service other than 13.5service as volunteer ambulance service personnel; 13.6    (16) new text begin (14) new text end except as provided in section 353.87, volunteer firefighters, as defined in 13.7subdivision 36, engaging in activities undertaken as part of volunteer firefighter duties, 13.8but a person who is a volunteer firefighter may still qualify as a public employee under 13.9subdivision 2 and may be a member of the Public Employees Retirement Association and 13.10a participant in the general employees retirement plan or the public employees police 13.11and fire plan, whichever applies, on the basis of compensation received from public 13.12employment activities other than those as a volunteer firefighter; 13.13    (17) new text begin (15) new text end pipefitters and associated trades personnel employed by Independent 13.14School District No. 625, St. Paul, with coverage under a collective bargaining agreement 13.15by the pipefitters local 455 pension plan who were either first employed after May 1, 13.161997, or, if first employed before May 2, 1997, elected to be excluded under Laws 1997, 13.17chapter 241, article 2, section 12; 13.18    (18) new text begin (16) new text end electrical workers, plumbers, carpenters, and associated trades personnel 13.19who are employed by Independent School District No. 625, St. Paul, or the city of St. 13.20Paul, who have retirement coverage under a collective bargaining agreement by the 13.21Electrical Workers Local 110 pension plan, the United Association Plumbers Local 34 13.22pension plan, or the pension plan applicable to Carpenters Local 87 new text begin 322 new text end who were either 13.23first employed after May 1, 2000, or, if first employed before May 2, 2000, elected to be 13.24excluded under Laws 2000, chapter 461, article 7, section 5; 13.25    (19) new text begin (17) new text end bricklayers, allied craftworkers, cement masons, glaziers, glassworkers, 13.26painters, allied tradesworkers, and plasterers who are employed by the city of St. Paul 13.27or Independent School District No. 625, St. Paul, with coverage under a collective 13.28bargaining agreement by the Bricklayers and Allied Craftworkers Local 1 pension plan, 13.29the Cement Masons Local 633 pension plan, the Glaziers and Glassworkers Local L-1324 13.30pension plan, the Painters and Allied Trades Local 61 pension plan, or the Twin Cities 13.31Plasterers Local 265 pension plan who were either first employed after May 1, 2001, or if 13.32first employed before May 2, 2001, elected to be excluded under Laws 2001, First Special 13.33Session chapter 10, article 10, section 6; 13.34    (20) new text begin (18) new text end plumbers who are employed by the Metropolitan Airports Commission, 13.35with coverage under a collective bargaining agreement by the Plumbers Local 34 pension 13.36plan, who either were first employed after May 1, 2001, or if first employed before May 2, 14.12001, elected to be excluded under Laws 2001, First Special Session chapter 10, article 14.210, section 6; 14.3    (21) new text begin (19) new text end employees who are hired after June 30, 2002, new text begin solely new text end to fill seasonal positions 14.4under subdivision 12b which are limited in duration by the employer to 185 consecutive 14.5calendar days or less in each year of employment with the governmental subdivision; 14.6    (22) new text begin (20) new text end persons who are provided supported employment or work-study positions 14.7by a governmental subdivision and who participate in an employment or industries 14.8program maintained for the benefit of these persons where the governmental subdivision 14.9limits the position's duration to up to five years, including persons participating in a 14.10federal or state subsidized on-the-job training, work experience, senior citizen, youth, or 14.11unemployment relief program where the training or work experience is not provided as a 14.12part of, or for, future permanent public employment; 14.13    (23) new text begin (21) new text end independent contractors and the employees of independent contractors; 14.14    (24) new text begin (22) new text end reemployed annuitants of the association during the course of that 14.15reemployment; and 14.16(25) new text begin (23) new text end persons appointed to serve on a board or commission of a governmental 14.17subdivision or an instrumentality thereof. new text begin ; and new text end 14.18 new text begin (24) persons employed as full-time fixed-route bus drivers by the St. Cloud new text end 14.19 new text begin Metropolitan Transit Commission who are members of the International Brotherhood new text end 14.20 new text begin of Teamsters Local 638 and who are, by virtue of that employment, members of the new text end 14.21 new text begin International Brotherhood of Teamsters Central States pension plan. new text end 14.22(b) Any person performing the duties of a public officer in a position defined in 14.23subdivision 2a, paragraph (a), clause (3), is not an independent contractor and is not an 14.24employee of an independent contractor. 14.25 new text begin EFFECTIVE DATE. new text end new text begin This section is effective January 1, 2015, except paragraph new text end 14.26 new text begin (a), clause (24), which is effective retroactively from August 1, 1986. new text end 14.27    Sec. 5. Minnesota Statutes 2012, section 353.27, is amended by adding a subdivision 14.28to read: 14.29     new text begin Subd. 10a. new text end new text begin Written disclosure of membership exclusion determination. new text end new text begin If the new text end 14.30 new text begin determination by the employer under section 353.01, subdivisions 2a and 2b, is to exclude new text end 14.31 new text begin a public employee from membership, the governmental subdivision shall provide the new text end 14.32 new text begin employee with a written notice of the exclusion on a form prescribed by the executive new text end 14.33 new text begin director. The notice must include the statutory basis for the exclusion and information new text end 14.34 new text begin about the employee's right to appeal the determination to the association under section new text end 15.1 new text begin 356.96. The employer must provide the exclusion notice to the employee within two new text end 15.2 new text begin weeks of the date of the determination and shall retain a copy in the person's personnel file. new text end 15.3 new text begin EFFECTIVE DATE. new text end new text begin This section is effective January 1, 2015. new text end 15.4    Sec. 6. Minnesota Statutes 2012, section 354.05, subdivision 2, is amended to read: 15.5    Subd. 2. Teacher. (a) "Teacher" means: 15.6(1) a person who renders service as a teacher, supervisor, principal, superintendent, 15.7librarian, nurse, counselor, social worker, therapist, or psychologist in a public school of 15.8the state located outside of the corporate limits of the city of Duluth or the city of St. Paul 15.9 new text begin other than in Independent School District No. 625 or in Independent School District No. new text end 15.10 new text begin 709 new text end , or in any charter school, irrespective of the location of the school, or in any charitable, 15.11penal, or correctional institutions of a governmental subdivision, or who is engaged in 15.12educational administration in connection with the state public school system, but excluding 15.13the University of Minnesota, whether the position be a public office or an employment, and 15.14not including the members or officers of any general governing or managing board or body; 15.15(2) an employee of the Teachers Retirement Association; 15.16(3) a person who renders teaching service on a part-time basis and who also renders 15.17other services for a single employing unit. A person whose new text begin where the new text end teaching service 15.18comprises at least 50 percent of the combined employment salary is a member of the 15.19association for all services with the single employing unit. If the person's teaching service 15.20comprises new text begin or, if new text end less than 50 percent of the combined employment salary, the executive 15.21director must determine whether new text begin determines new text end all or none of the combined service is covered 15.22by the association; or 15.23(4) a person who is not covered by the plans established under chapter 352D, 354A, 15.24or 354B and who is employed by the Board of Trustees of the Minnesota State Colleges 15.25and Universities system in an unclassified position as: 15.26(i) a president, vice-president, or dean; 15.27(ii) a manager or a professional in an academic or an academic support program 15.28other than specified in item (i); 15.29(iii) an administrative or a service support faculty position; or 15.30(iv) a teacher or a research assistant. 15.31(b) "Teacher" does not mean: 15.32(1) a person who works for a school or institution as an independent contractor as 15.33defined by the Internal Revenue Service; 15.34(2) a person who renders part-time teaching service or who is a customized trainer 15.35as defined by the Minnesota State Colleges and Universities system if (i) the service is 16.1incidental to the regular nonteaching occupation of the person; and (ii) the employer 16.2stipulates annually in advance that the part-time teaching service or customized training 16.3service will not exceed 300 hours in a fiscal year and retains the stipulation in its records; 16.4and (iii) the part-time teaching service or customized training service actually does not 16.5exceed 300 hours in a fiscal year; or 16.6(3) a person exempt from licensure under section 122A.30. new text begin ; new text end 16.7 new text begin (4) annuitants of the teachers retirement plan who are employed after retirement by new text end 16.8 new text begin an employing unit that participates in the teachers retirement plan during the course of new text end 16.9 new text begin that reemployment; new text end 16.10 new text begin (5) a person who is employed by the University of Minnesota; new text end 16.11 new text begin (6) a member or an officer of any general governing or managing board or body of new text end 16.12 new text begin an employing unit that participates in the teachers retirement plan; or new text end 16.13 new text begin (7) a person employed by Independent School District No. 625 or Independent new text end 16.14 new text begin School District No. 709 as a teacher as defined in section 354A.011, subdivision 27. new text end 16.15 new text begin EFFECTIVE DATE. new text end new text begin This section is effective July 1, 2014. new text end 16.16    Sec. 7. Minnesota Statutes 2012, section 354A.011, subdivision 27, is amended to read: 16.17    Subd. 27. Teacher. (a) "Teacher" means any person who renders service for a public 16.18school district, other than a charter school, located in the corporate limits of Duluth or 16.19St. Paul, as any of the following: 16.20(1) a full-time employee in a position for which a valid license from the state 16.21Department of Education is required; 16.22(2) an employee of the teachers retirement fund association located in the city of 16.23the first class; 16.24(3) a part-time employee in a position for which a valid license from the state 16.25Department of Education is required; or 16.26(4) a part-time employee in a position for which a valid license from the state 16.27Department of Education is required who also renders other nonteaching services for the 16.28school district, unless the board of trustees of the teachers retirement fund association 16.29determines that the combined employment is on the whole so substantially dissimilar to 16.30teaching service that the service may not be covered by the association. 16.31(b) The term does not mean any person who renders service in the school district 16.32as any of the following: 16.33(1) an independent contractor or the employee of an independent contractor; 17.1(2) an employee who is a full-time teacher covered by the Teachers Retirement 17.2Association or by another teachers retirement fund association established pursuant to this 17.3chapter or chapter 354; 17.4(3) an employee who is exempt from licensure pursuant to section 122A.30; 17.5(4) an employee who is a teacher in a technical college located in a city of the first 17.6class unless the person elects coverage by the applicable first class city teacher retirement 17.7fund association under section 354B.21, subdivision 2; 17.8(5) a teacher employed by a charter school, irrespective of the location of the 17.9school; or 17.10(6) an employee who is a part-time teacher in a technical college in a city of the first 17.11class and who has elected coverage by the applicable first class city teacher retirement 17.12fund association under section 354B.21, subdivision 2, but (i) the teaching service is 17.13incidental to the regular nonteaching occupation of the person; (ii) the applicable technical 17.14college stipulates annually in advance that the part-time teaching service will not exceed 17.15300 hours in a fiscal year; and (iii) the part-time teaching actually does not exceed 300 17.16hours in the fiscal year to which the certification applies. new text begin ; or new text end 17.17 new text begin (7) a person who is receiving a retirement annuity from the Teachers Retirement new text end 17.18 new text begin Fund Association and is employed after retirement by the school district associated with new text end 17.19 new text begin the retirement fund association. new text end 17.20 new text begin EFFECTIVE DATE. new text end new text begin This section is effective July 1, 2014. new text end 17.21    Sec. 8. Minnesota Statutes 2012, section 356.24, subdivision 1, is amended to read: 17.22    Subdivision 1. Restriction; exceptions. It is unlawful for a school district or other 17.23governmental subdivision or state agency to levy taxes for or to contribute public funds to 17.24a supplemental pension or deferred compensation plan that is established, maintained, 17.25and operated in addition to a primary pension program for the benefit of the governmental 17.26subdivision employees other than: 17.27    (1) to a supplemental pension plan that was established, maintained, and operated 17.28before May 6, 1971; 17.29    (2) to a plan that provides solely for group health, hospital, disability, or death 17.30benefits; 17.31    (3) to the individual retirement account plan established by chapter 354B; 17.32    (4) to a plan that provides solely for severance pay under section 465.72 to a retiring 17.33or terminating employee; 17.34    (5) for employees other than personnel employed by the Board of Trustees of the 17.35Minnesota State Colleges and Universities and covered under the Higher Education 18.1Supplemental Retirement Plan under chapter 354C, but including city managers covered 18.2by an alternative retirement arrangement under section 353.028, subdivision 3, paragraph 18.3(a), or by the defined contribution plan of the Public Employees Retirement Association 18.4under section 353.028, subdivision 3, paragraph (b), if the supplemental plan coverage is 18.5provided for in a personnel policy of the public employer or in the collective bargaining 18.6agreement between the public employer and the exclusive representative of public 18.7employees in an appropriate unit or in the individual employment contract between a city 18.8and a city manager, and if for each available investment all fees and historic rates of return 18.9for the prior one-, three-, five-, and ten-year periods, or since inception, are disclosed in an 18.10easily comprehended document not to exceed two pages, in an amount matching employee 18.11contributions on a dollar for dollar basis, but not to exceed an employer contribution of 18.12one-half of the available elective deferral permitted per year per employee, under the 18.13Internal Revenue Code: 18.14    (i) to the state of Minnesota deferred compensation plan under section 352.965; 18.15    (ii) in payment of the applicable portion of the contribution made to any investment 18.16eligible under section 403(b) of the Internal Revenue Code, if the employing unit has 18.17complied with any applicable pension plan provisions of the Internal Revenue Code with 18.18respect to the tax-sheltered annuity program during the preceding calendar year; or 18.19    (iii) any other deferred compensation plan offered by the employer under section 18.20457 of the Internal Revenue Code; 18.21    (6) for personnel employed by the Board of Trustees of the Minnesota State Colleges 18.22and Universities and not covered by clause (5), to the supplemental retirement plan under 18.23chapter 354C, if the supplemental plan coverage is provided for in a personnel policy 18.24or in the collective bargaining agreement of the public employer with the exclusive 18.25representative of the covered employees in an appropriate unit, in an amount matching 18.26employee contributions on a dollar for dollar basis, but not to exceed an employer 18.27contribution of $2,700 a year for each employee; 18.28    (7) to a supplemental plan or to a governmental trust to save for postretirement 18.29health care expenses qualified for tax-preferred treatment under the Internal Revenue 18.30Code, if the supplemental plan coverage is provided for in a personnel policy or in the 18.31collective bargaining agreement of a public employer with the exclusive representative of 18.32the covered employees in an appropriate unit; 18.33    (8) to the laborers national industrial pension fund or to a laborers local pension fund 18.34for the employees of a governmental subdivision who are covered by a collective bargaining 18.35agreement that provides for coverage by that fund and that sets forth a fund contribution 18.36rate, but not to exceed an employer contribution of $5,000 per year per employee; 19.1    (9) to the plumbers and pipefitters national pension fund or to a plumbers and 19.2pipefitters local pension fund for the employees of a governmental subdivision who are 19.3covered by a collective bargaining agreement that provides for coverage by that fund and 19.4that sets forth a fund contribution rate, but not to exceed an employer contribution of 19.5$5,000 per year per employee; 19.6    (10) to the international union of operating engineers pension fund for the employees 19.7of a governmental subdivision who are covered by a collective bargaining agreement that 19.8provides for coverage by that fund and that sets forth a fund contribution rate, but not to 19.9exceed an employer contribution of $5,000 per year per employee; 19.10    (11) to a supplemental plan organized and operated under the federal Internal 19.11Revenue Code, as amended, that is wholly and solely funded by the employee's 19.12accumulated sick leave, accumulated vacation leave, and accumulated severance pay; 19.13    (12) to the International Association of Machinists national pension fund for the 19.14employees of a governmental subdivision who are covered by a collective bargaining 19.15agreement that provides for coverage by that fund and that sets forth a fund contribution 19.16rate, but not to exceed an employer contribution of $5,000 per year per employee; 19.17    (13) for employees of United Hospital District, Blue Earth, to the state of Minnesota 19.18deferred compensation program, if the employee makes a contribution, in an amount that 19.19does not exceed the total percentage of covered salary under section 353.27, subdivisions 19.203 and 3a; or 19.21(14) to the alternative retirement plans established by the Hennepin County Medical 19.22Center under section 383B.914, subdivision 5. new text begin ; or new text end 19.23 new text begin (15) to the International Brotherhood of Teamsters Central States pension plan for new text end 19.24 new text begin fixed-route bus drivers employed by the St. Cloud Metropolitan Transit Commission who new text end 19.25 new text begin are members of the International Brotherhood of Teamsters Local 638 by virtue of that new text end 19.26 new text begin employment. new text end 19.27 new text begin EFFECTIVE DATE. new text end new text begin This section is effective retroactively from August 1, 1986. new text end 19.28    Sec. 9. new text begin VALIDATION OF PAST RETIREMENT COVERAGE new text end 19.29 new text begin AND CONTRIBUTIONS FOR STEVENS COUNTY HOUSING AND new text end 19.30 new text begin REDEVELOPMENT AUTHORITY EMPLOYEES. new text end 19.31 new text begin (a) Retirement coverage by the general employees plan of the Public Employees new text end 19.32 new text begin Retirement Association, allowable service credit, and salary credit for employees of the new text end 19.33 new text begin Stevens County Housing and Redevelopment Authority who were so employed after new text end 19.34 new text begin November 7, 1984, and were first so employed before May 1, 2014, who had monthly new text end 19.35 new text begin salary in any month of at least $325 until June 30, 1988, and who had monthly salary in new text end 20.1 new text begin any month of at least $425 after June 30, 1988, who were not otherwise excluded under new text end 20.2 new text begin the applicable edition of Minnesota Statutes, section 353.01, subdivision 2b, and who had new text end 20.3 new text begin member deductions taken and transferred in a timely manner to the general employees new text end 20.4 new text begin retirement fund before the effective date of this section are hereby validated. new text end 20.5 new text begin (b) Notwithstanding any provision of Minnesota Statutes, chapter 353, to the new text end 20.6 new text begin contrary, employee contributions deducted from employees of the Stevens County new text end 20.7 new text begin Housing and Redevelopment Authority described in paragraph (a) before the effective new text end 20.8 new text begin date of this section and associated employer contributions are valid assets of the general new text end 20.9 new text begin employees retirement fund and are not subject to refund or adjustment for erroneous new text end 20.10 new text begin receipt except as provided in Minnesota Statutes, section 353.32, subdivision 1 or 2; new text end 20.11 new text begin or 353.34, subdivisions 1 and 2. new text end 20.12 new text begin EFFECTIVE DATE. new text end new text begin This section is effective the day following final enactment. new text end 20.13ARTICLE 2 20.14RETIREMENT GOVERNING BOARD PROVISIONS 20.15    Section 1. Minnesota Statutes 2012, section 352.03, subdivision 1, is amended to read: 20.16    Subdivision 1. Membership of board; election; term. new text begin (a) new text end The policy-making 20.17function of the system is vested in a board of 11 members known as the board of directors. 20.18This board shall consist of new text begin : new text end 20.19 new text begin (1) new text end three members appointed by the governor, one of whom must be a constitutional 20.20officer or appointed state official and two of whom must be public members knowledgeable 20.21in pension matters, new text begin ; new text end 20.22 new text begin (2) new text end four state employees elected by state employees covered by the system new text begin active new text end 20.23 new text begin members and former members eligible for a deferred annuity from the general state new text end 20.24 new text begin employees retirement plan, new text end excluding employees in categories specifically authorized 20.25to designate or elect a member by this subdivision, new text begin and deferred annuitants for whom new text end 20.26 new text begin a board member is designated; new text end 20.27 new text begin (3) new text end one employee of the Metropolitan Council's transit operations or its successor 20.28agency designated by the executive committee of the labor organization that is the 20.29exclusive bargaining agent representing employees of the transit division, new text begin ; new text end 20.30 new text begin (4) new text end one new text begin employee who is a new text end member of the State Patrol retirement fund new text begin plan new text end elected 20.31by new text begin active new text end members of new text begin and former members eligible for a deferred annuity from new text end that fund 20.32at a time and in a manner fixed by the board, new text begin plan; new text end 21.1 new text begin (5) new text end one employee covered by new text begin who is a member of new text end the correctional new text begin state new text end employees 21.2 new text begin retirement new text end plan new text begin established under this chapter new text end elected by employees covered by new text begin active new text end 21.3 new text begin members and former members eligible for a deferred annuity from new text end that plan, new text begin ; new text end and 21.4 new text begin (6) new text end one retired employee new text begin of a plan included in the system, new text end elected by disabled and 21.5retired employees of all new text begin the new text end plans administered by the system at a time and in a manner to 21.6be fixed new text begin determined new text end by the board. 21.7 new text begin (b) The terms of the four elected state employees under paragraph (a), clause (2), new text end 21.8 new text begin must be staggered, with new text end two new text begin of the new text end state employee members new text begin board positions elected new text end 21.9 new text begin each biennium new text end , whose terms of office begin on the first Monday in May after their 21.10election, must be elected biennially. Elected members and the appointed member of the 21.11Metropolitan Council's transit operations hold office for a term of four years and until their 21.12successors are elected or appointed, and have qualified. 21.13 new text begin (c) new text end An employee new text begin or former employee new text end of the system is not eligible for membership 21.14on the board of directors. A state employee on leave of absence is not eligible for election 21.15or reelection to membership on the board of directors. 21.16 new text begin (d) new text end The term of any board member who is on leave for more than six months 21.17automatically ends on expiration of the term of office. 21.18 new text begin EFFECTIVE DATE. new text end new text begin This section is effective the day following final enactment. new text end 21.19    Sec. 2. Minnesota Statutes 2012, section 352.03, is amended by adding a subdivision 21.20to read: 21.21     new text begin Subd. 1b. new text end new text begin Membership voting limitations. new text end new text begin Active members and former members new text end 21.22 new text begin eligible for a deferred annuity from a plan under this chapter or chapter 352B are eligible new text end 21.23 new text begin to vote in board elections as further specified and restricted in this section. Retired new text end 21.24 new text begin members and disabilitants from a plan in the system may vote only for the retired member new text end 21.25 new text begin position under subdivision 1, paragraph (a), clause (6). If a former member eligible for a new text end 21.26 new text begin deferred annuity from a plan under this chapter or chapter 352B is a deferred annuitant new text end 21.27 new text begin from more than one plan covered by the system, that person is eligible to vote only in new text end 21.28 new text begin elections applicable for deferred annuitants from the plan in the system from which the new text end 21.29 new text begin person last received allowable service. If a person is an active member of a plan in the new text end 21.30 new text begin system and is a deferred annuitant or a retiree from another plan or plans in the system, new text end 21.31 new text begin the person is only eligible to vote in board elections applicable due to the active member new text end 21.32 new text begin plan membership. If a person is a deferred annuitant from a plan in the system and is also new text end 21.33 new text begin a retiree from another plan in the system, the person is only eligible to vote in elections new text end 21.34 new text begin applicable due to the retiree status. new text end 22.1 new text begin EFFECTIVE DATE. new text end new text begin This section is effective the day following final enactment. new text end 22.2ARTICLE 3 22.3RETIREMENT PLAN CONTRIBUTION RATE CHANGES 22.4    Section 1. Minnesota Statutes 2012, section 352.04, subdivision 2, is amended to read: 22.5    Subd. 2. Employee contributions. (a) The employee contribution to the fund must 22.6be equal to the following percent of salary: 22.7 before July 1, 2007 4.00 22.8 from July 1, 2007, to June 30, 2008 4.25 22.9 from July 1, 2008, to June 30, 2009 4.50 22.10 from July 1, 2009, to June 30, 2010 4.75 22.11 22.12 from July 1, 2010, and thereafter new text begin to June 30, new text end new text begin 2014 new text end 5.00. 22.13 new text begin from July 1, 2014, and thereafter new text end new text begin 5.50. new text end 22.14(b) These contributions must be made by deduction from salary as provided in 22.15subdivision 4. 22.16 new text begin EFFECTIVE DATE. new text end new text begin This section is effective on the first day of the first full pay new text end 22.17 new text begin period beginning after July 1, 2014. new text end 22.18    Sec. 2. Minnesota Statutes 2012, section 352.04, subdivision 3, is amended to read: 22.19    Subd. 3. Employer contributions. The employer contribution to the fund must be 22.20equal to the following percent of salary: 22.21 before July 1, 2007 4.00 22.22 from July 1, 2007, to June 30, 2008 4.25 22.23 from July 1, 2008, to June 30, 2009 4.50 22.24 from July 1, 2009, to June 30, 2010 4.75 22.25 22.26 from July 1, 2010, and thereafter new text begin to June 30, new text end new text begin 2014 new text end 5.00. 22.27 new text begin from July 1, 2014, and thereafter new text end new text begin 5.50. new text end 22.28 new text begin EFFECTIVE DATE. new text end new text begin This section is effective on the first day of the first full pay new text end 22.29 new text begin period beginning after July 1, 2014. new text end 22.30    Sec. 3. Minnesota Statutes 2012, section 352.92, subdivision 1, is amended to read: 22.31    Subdivision 1. Employee contributions. (a) Employee contributions of covered 22.32correctional employees must be in an amount equal to the following percent of salary: 23.1 before July 1, 2007 5.69 23.2 from July 1, 2007, to June 30, 2008 6.40 23.3 from July 1, 2008, to June 30, 2009 7.00 23.4 from July 1, 2009, to June 30, 2010 7.70 23.5 23.6 from July 1, 2010, and thereafter new text begin to June 30, new text end new text begin 2014 new text end 8.60. 23.7 new text begin from July 1, 2014, and thereafter new text end new text begin 9.10. new text end 23.8(b) These contributions must be made by deduction from salary as provided in 23.9section 352.04, subdivision 4. 23.10 new text begin EFFECTIVE DATE. new text end new text begin This section is effective on the first day of the first full pay new text end 23.11 new text begin period beginning after July 1, 2014. new text end 23.12    Sec. 4. Minnesota Statutes 2012, section 352.92, subdivision 2, is amended to read: 23.13    Subd. 2. Employer contributions. The employer shall contribute for covered 23.14correctional employees an amount equal to the following percent of salary: 23.15 before July 1, 2007 7.98 23.16 from July 1, 2007, to June 30, 2008 9.10 23.17 from July 1, 2008, to June 30, 2009 10.10 23.18 from July 1, 2009, to June 30, 2010 11.10 23.19 23.20 from July 1, 2010, and thereafter new text begin to June 30, new text end new text begin 2014 new text end 12.10. 23.21 new text begin from July 1, 2014, and thereafter new text end new text begin 12.85. new text end 23.22 new text begin EFFECTIVE DATE. new text end new text begin This section is effective on the first day of the first full pay new text end 23.23 new text begin period beginning after July 1, 2014. new text end 23.24    Sec. 5. Minnesota Statutes 2012, section 353.27, subdivision 2, is amended to read: 23.25    Subd. 2. General employees retirement plan; employee contribution. (a) For 23.26a basic member of the general employees retirement plan of the Public Employees 23.27Retirement Association, the employee contribution is 9.10 percent of salary. For a 23.28coordinated member of the general employees retirement plan of the Public Employees 23.29Retirement Association, the employee contribution is the following percentage of salary 23.30plus any contribution rate adjustment under subdivision 3b: 23.31 Effective before January 1, 2011 6.00 23.32 Effective after December 31, 2010 6.25 23.33 new text begin Effective January 1, 2015 new text end new text begin 6.50. new text end 23.34(b) These contributions must be made by deduction from salary as defined in section 23.35353.01, subdivision 10 , in the manner provided in subdivision 4. If any portion of a 24.1member's salary is paid from other than public funds, the member's employee contribution 24.2must be based on the total salary received by the member from all sources. 24.3 new text begin EFFECTIVE DATE. new text end new text begin This section is effective the day following final enactment. new text end 24.4    Sec. 6. Minnesota Statutes 2012, section 353.27, subdivision 3, is amended to read: 24.5    Subd. 3. General employees retirement plan; employer contribution. (a) For 24.6a basic member of the general employees retirement plan of the Public Employees 24.7Retirement Association, the employer contribution is 9.10 percent of salary. For a 24.8coordinated member of the general employees retirement plan of the Public Employees 24.9Retirement Association, the employer contribution is the following percentage of salary 24.10plus any contribution rate adjustment under subdivision 3b: 24.11 Effective before January 1, 2011 6.00 24.12 Effective after December 31, 2010 6.25 24.13 new text begin Effective January 1, 2015 new text end new text begin 6.50. new text end 24.14(b) This contribution must be made from funds available to the employing 24.15subdivision by the means and in the manner provided in section 353.28. 24.16 new text begin EFFECTIVE DATE. new text end new text begin This section is effective the day following final enactment. new text end 24.17    Sec. 7. Minnesota Statutes 2012, section 353.27, subdivision 3b, is amended to read: 24.18    Subd. 3b. Change in employee and employer contributions in certain instances. 24.19(a) For purposes of this section: 24.20(1) a contribution sufficiency exists if the total of the employee contribution under 24.21subdivision 2, the employer contribution under subdivision 3, the additional employer 24.22contribution under subdivision 3a, and any additional contribution previously imposed 24.23under this subdivision exceeds the total of the normal cost, the administrative expenses, 24.24and the amortization contribution of the general employees retirement plan as reported in 24.25the most recent actuarial valuation of the retirement plan prepared by the actuary retained 24.26under section 356.214 and prepared under section 356.215 and the standards for actuarial 24.27work of the Legislative Commission on Pensions and Retirement; and 24.28(2) a contribution deficiency exists if the total of the employee contributions under 24.29subdivision 2, the employer contributions under subdivision 3, the additional employer 24.30contribution under subdivision 3a, and any additional contribution previously imposed 24.31under this subdivision is less than the total of the normal cost, the administrative expenses, 24.32and the amortization contribution of the general employees retirement plan as reported in 24.33the most recent actuarial valuation of the retirement plan prepared by the actuary retained 25.1under section 356.214 and prepared under section 356.215 and the standards for actuarial 25.2work of the Legislative Commission on Pensions and Retirement. 25.3(b) Employee and employer contributions to the general employees retirement plan 25.4under subdivisions 2 and 3 must be adjusted: 25.5(1) if, on or after July 1, 2010, the regular actuarial valuation of the general employees 25.6retirement plan of the Public Employees Retirement Association under section 356.215 25.7indicates that there is a contribution sufficiency under paragraph (a) greater than one 25.8percent of covered payroll and that the sufficiency has existed for at least two consecutive 25.9years, the coordinated program employee and employer contribution rates must be 25.10decreased as determined under paragraph (c) to a level such that the sufficiency is no 25.11greater than one percent of covered payroll based on the most recent actuarial valuation; or 25.12(2) if, on or after July 1, 2010, the regular actuarial valuation of the general 25.13employees retirement plan of the Public Employees Retirement Association under section 25.14356.215 indicates that there is a contribution deficiency equal to or greater than 0.5 percent 25.15of covered payroll and that the deficiency has existed for at least two consecutive years, 25.16the coordinated program employee and employer contribution rates must be increased 25.17as determined under paragraph (d) to a level such that no deficiency exists based on the 25.18most recent actuarial valuation. 25.19(c) If the actuarially required contribution of the general employees retirement plan is 25.20less than the total support provided by the combined employee and employer contribution 25.21rates under subdivisions 2, 3, and 3a, by more than one percent of covered payroll, 25.22the general employees retirement plan coordinated program employee and employer 25.23contribution rates under subdivisions 2 and 3 must be decreased incrementally over one or 25.24more years by no more than 0.25 percent of pay each for employee and employer matching 25.25contribution rates to a level such that there remains a contribution sufficiency of at least one 25.26percent of covered payroll. No contribution rate decrease may be made until at least two 25.27years have elapsed since any adjustment under this subdivision has been fully implemented. 25.28(d) If the actuarially required contribution exceeds the total support provided by the 25.29combined employee and employer contribution rates under subdivisions 2, 3, and 3a, 25.30the employee and matching employer contribution rates must be increased equally to 25.31eliminate that contribution deficiency. If the contribution deficiency is: 25.32(1) less than two percent, the incremental increase may be up to 0.25 percent for the 25.33general employees retirement plan employee and matching employer contribution rates; 25.34(2) greater than 1.99 percent and less than 4.01 percent, the incremental increase 25.35may be up to 0.5 percent for the employee and matching employer contribution rates; or 26.1(3) greater than four percent, the incremental increase may be up to 0.75 percent for 26.2the employee and matching employer contribution. 26.3(e) The general employees retirement plan contribution sufficiency or deficiency 26.4determination under paragraphs (a) to (d) must be made without the inclusion of the 26.5contributions to, the funded condition of, or the actuarial funding requirements of the 26.6MERF division. 26.7(f) Any recommended adjustment to the contribution rates must be reported to the 26.8chair and the executive director of the Legislative Commission on Pensions and Retirement 26.9by January 15 following new text begin the new text end receipt of the most recent annual actuarial valuation prepared 26.10under section 356.215. If the Legislative Commission on Pensions and Retirement does 26.11not recommend against the rate change or does not recommend a modification in the rate 26.12change, the recommended adjustment becomes effective on the first day of the first full 26.13payroll period in the fiscal year new text begin for any salary paid on or after the January 1 next new text end following 26.14receipt of the most recent actuarial valuation that gave rise to the adjustment new text begin the legislative new text end 26.15 new text begin session in which the Legislative Commission on Pensions and Retirement did not take any new text end 26.16 new text begin action to disapprove or modify the Public Employees Retirement Association Board of new text end 26.17 new text begin Trustees' recommendation to adjust the employee and employer rates new text end . 26.18(g) A contribution sufficiency of up to one percent of covered payroll must be held in 26.19reserve to be used to offset any future actuarially required contributions that are more than 26.20the total combined employee and employer contributions under subdivisions 2, 3, and 3a. 26.21(h) Before any reduction in contributions to eliminate a sufficiency in excess of one 26.22percent of covered pay may be recommended, the executive director must review any 26.23need for a change in actuarial assumptions, as recommended by the actuary retained under 26.24section 356.214 in the most recent experience study of the general employees retirement 26.25plan prepared under section 356.215 and the standards for actuarial work promulgated by 26.26the Legislative Commission on Pensions and Retirement that may result in an increase 26.27in the actuarially required contribution and must report to the Legislative Commission 26.28on Pensions and Retirement any recommendation by the board to use the sufficiency 26.29exceeding one percent of covered payroll to offset the impact of an actuarial assumption 26.30change recommended by the actuary retained under section 356.214, subdivision 1, and 26.31reviewed by the actuary retained by the commission under section 356.214, subdivision 4. 26.32(i) No contribution sufficiency in excess of one percent of covered pay may be 26.33proposed to be used to increase benefits, and no benefit increase may be proposed that 26.34would initiate an automatic adjustment to increase contributions under this subdivision. 26.35Any proposed benefit improvement must include a recommendation, prepared by the 26.36actuary retained under section 356.214, subdivision 1, and reviewed by the actuary 27.1retained by the Legislative Commission on Pensions and Retirement as provided under 27.2section 356.214, subdivision 4, on how the benefit modification will be funded. 27.3 new text begin EFFECTIVE DATE. new text end new text begin This section is effective the day following final enactment. new text end 27.4ARTICLE 4 27.5JOINT AND SURVIVOR OPTIONAL ANNUITY COMPUTATION 27.6DISCOUNT RATE 27.7    Section 1. Minnesota Statutes 2012, section 3A.01, subdivision 1a, is amended to read: 27.8    Subd. 1a. Actuarial equivalent. new text begin (a) new text end "Actuarial equivalent" means the condition of 27.9one allowance or benefit having an equal actuarial present value to another allowance or 27.10benefit, determined by the actuary retained under section 356.214 as of a given date at a 27.11specified age with each actuarial present value based on the mortality table applicable for 27.12the plan and approved under section 356.215, subdivision 18, and using the applicable 27.13preretirement or postretirement interest rate assumption specified in section 356.215, 27.14subdivision 8 . 27.15 new text begin (b) For purposes of computing a joint and survivor annuity, the postretirement new text end 27.16 new text begin interest rate assumption specified in section 356.461 must be used, rather than the new text end 27.17 new text begin postretirement interest rate specified in section 356.215, subdivision 8. new text end 27.18 new text begin EFFECTIVE DATE. new text end new text begin This section is effective July 1, 2014. new text end 27.19    Sec. 2. Minnesota Statutes 2012, section 352.01, subdivision 12, is amended to read: 27.20    Subd. 12. Actuarial equivalent. new text begin (a) new text end "Actuarial equivalent" means the condition 27.21of one annuity or benefit having an equal actuarial present value as another annuity or 27.22benefit, determined as of a given date at a specified age with each actuarial present value 27.23based on the appropriate mortality table adopted by the board of directors based on the 27.24experience of the fund as recommended by the actuary retained under section 356.214, and 27.25approved under section 356.215, subdivision 18, and using the applicable preretirement or 27.26postretirement interest rate assumption specified in section 356.215, subdivision 8. 27.27 new text begin (b) For purposes of computing a joint and survivor annuity, the postretirement new text end 27.28 new text begin interest rate assumption specified in section 356.461 must be used, rather than the new text end 27.29 new text begin postretirement interest rate specified in section 356.215, subdivision 8. new text end 27.30 new text begin EFFECTIVE DATE. new text end new text begin This section is effective July 1, 2014. new text end 28.1    Sec. 3. Minnesota Statutes 2013 Supplement, section 352.03, subdivision 4, is 28.2amended to read: 28.3    Subd. 4. Duties and powers of board of directors. (a) The board shall: 28.4    (1) elect a chair; 28.5    (2) appoint an executive director; 28.6    (3) establish rules to administer this chapter and chapters 3A, 352B, 352C, 352D, 28.7and 490 and transact the business of the system, subject to the limitations of law; 28.8    (4) consider and dispose of, or take any other action the board of directors deems 28.9appropriate concerning, denials of applications for annuities or disability benefits under 28.10this chapter, chapter 3A, 352B, 352C, 352D, or 490, and complaints of employees and 28.11others pertaining to the retirement of employees and the operation of the system; 28.12    (5) oversee the administration of the deferred compensation plan established in 28.13section 352.965; 28.14    (6) oversee the administration of the health care savings plan established in section; 28.15and 28.16    (7) approve early retirement and optional annuity factors new text begin for all plans administered new text end 28.17 new text begin by the system, including approving retirement annuity factors for the unclassified state new text end 28.18 new text begin employees program under chapter 352D new text end , subject to review by the actuary retained by 28.19the Legislative Commission on Pensions and Retirement; establish the schedule for 28.20implementation of the approved factors; and notify the Legislative Commission on 28.21Pensions and Retirement of the implementation schedule. 28.22    (b) The board shall advise the director on any matters relating to the system and 28.23carrying out functions and purposes of this chapter. The board's advice shall control. 28.24 new text begin EFFECTIVE DATE. new text end new text begin This section is effective July 1, 2014. new text end 28.25    Sec. 4. Minnesota Statutes 2012, section 352B.08, subdivision 3, is amended to read: 28.26    Subd. 3. Optional annuity forms. new text begin (a) new text end In lieu of the single life annuity provided in 28.27subdivision 2, the member or former member may elect an optional annuity form. The 28.28board of the Minnesota state retirement system shall establish a joint and survivor annuity, 28.29payable to a designated beneficiary for life, adjusted to the actuarial equivalent value of 28.30the single life annuity. The board shall also establish an additional optional annuity with 28.31an actuarial equivalent value of the single life annuity in the form of a joint and survivor 28.32annuity which provides that the elected annuity be reinstated to the single life annuity 28.33provided in subdivision 2, if after commencing the elected joint and survivor annuity, the 28.34designated beneficiary dies before the member, which reinstatement is not retroactive but 28.35takes effect for the first full month occurring after the death of the designated beneficiary. 29.1The board may also establish other actuarial equivalent value optional annuity forms. In 29.2establishing actuarial equivalent value optional annuity forms, each optional annuity form 29.3shall have the same present value as a regular single life annuity using the mortality 29.4table adopted by the board and the interest assumption specified in section 356.215, 29.5subdivision 8 , and new text begin . new text end 29.6 new text begin (b) For purposes of computing a joint and survivor annuity, the postretirement new text end 29.7 new text begin interest rate assumption specified in section 356.461 must be used, rather than the new text end 29.8 new text begin postretirement interest rate specified in section 356.215, subdivision 8. new text end 29.9 new text begin (c) new text end The board shall obtain the written recommendation of the actuary retained under 29.10section 356.214. These recommendations shall be a part of the permanent records of 29.11the board. 29.12 new text begin EFFECTIVE DATE. new text end new text begin This section is effective July 1, 2014. new text end 29.13    Sec. 5. Minnesota Statutes 2012, section 353.01, subdivision 14, is amended to read: 29.14    Subd. 14. Actuarial equivalent. new text begin (a) new text end "Actuarial equivalent" means the condition 29.15of one annuity or benefit having an equal actuarial present value as another annuity or 29.16benefit, determined as of a given date with each actuarial present value based on the 29.17appropriate mortality table adopted by the board of trustees based on the experience of the 29.18fund as recommended by the actuary retained under section 356.214, and approved under 29.19section 356.215, subdivision 18, and using the applicable preretirement or postretirement 29.20interest rate assumption specified in section 356.215, subdivision 8. 29.21 new text begin (b) For purposes of computing a joint and survivor annuity, the postretirement new text end 29.22 new text begin interest rate assumption specified in section 356.461 must be used rather than the new text end 29.23 new text begin postretirement interest rate specified in section 356.215, subdivision 8. new text end 29.24 new text begin EFFECTIVE DATE. new text end new text begin This section is effective on the same date as the next mortality new text end 29.25 new text begin assumption adjustment or on July 1, 2017, whichever is earlier. new text end 29.26    Sec. 6. Minnesota Statutes 2012, section 353.30, subdivision 3, is amended to read: 29.27    Subd. 3. Optional retirement annuity forms. new text begin (a) new text end The board of trustees shall 29.28establish optional annuities which shall take the form of a joint and survivor annuity. 29.29Except as provided in subdivision 3a, the optional annuity forms shall be actuarially 29.30equivalent to the forms provided in section 353.29 and subdivisions 1, 1a, 1b, 1c, and 5. 29.31In establishing those optional forms, the board shall obtain the written recommendation of 29.32the actuary retained under section 356.214. The recommendations shall be a part of the 29.33permanent records of the board. A member or former member may select an optional form 30.1of annuity, subject to the provisions of section 356.46, in lieu of accepting any other form 30.2of annuity which might otherwise be available. 30.3 new text begin (b) For purposes of computing a joint and survivor annuity, the postretirement new text end 30.4 new text begin interest rate assumption specified in section 356.461 must be used rather than the new text end 30.5 new text begin postretirement interest rate specified in section 356.215, subdivision 8. new text end 30.6 new text begin EFFECTIVE DATE. new text end new text begin This section is effective on the same date as the next mortality new text end 30.7 new text begin assumption adjustment or on July 1, 2017, whichever is earlier. new text end 30.8    Sec. 7. Minnesota Statutes 2012, section 354.05, subdivision 7, is amended to read: 30.9    Subd. 7. Actuarial equivalent. new text begin (a) new text end "Actuarial equivalent" means the condition 30.10of one annuity or benefit having an equal actuarial present value as another annuity or 30.11benefit, determined as of a given date with each actuarial present value based on the 30.12appropriate mortality table adopted by the board of trustees based on the experience 30.13of the association as recommended by the actuary retained under section 356.214, and 30.14approved under section 356.215, subdivision 18, and using the applicable preretirement or 30.15postretirement interest rate assumption specified in section 356.215, subdivision 8. 30.16 new text begin (b) For purposes of computing a joint and survivor annuity, the postretirement new text end 30.17 new text begin interest rate assumption specified in section 356.461 must be used rather than the new text end 30.18 new text begin postretirement interest rate specified in section 356.215, subdivision 8. new text end 30.19 new text begin EFFECTIVE DATE. new text end new text begin This section is effective July 1, 2014. new text end 30.20    Sec. 8. new text begin [356.461] VARIOUS RETIREMENT SYSTEMS; JOINT AND new text end 30.21 new text begin SURVIVOR ANNUITY COMPUTATION. new text end 30.22     new text begin Subdivision 1. new text end new text begin Joint and survivor annuity computation. new text end new text begin Notwithstanding any new text end 30.23 new text begin provision of section 356.215, subdivision 8, or 356.415 to the contrary, for purposes of new text end 30.24 new text begin computing joint and survivor annuities, the applicable postretirement interest assumption new text end 30.25 new text begin is 6.5 percent. new text end 30.26     new text begin Subd. 2. new text end new text begin Covered plans. new text end new text begin This section applies to the following retirement plans: new text end 30.27 new text begin (1) the legislators retirement plan, established under chapter 3A, including new text end 30.28 new text begin constitutional officers as specified in that chapter; new text end 30.29 new text begin (2) the correctional state employees retirement plan of the Minnesota State new text end 30.30 new text begin Retirement System, established under chapter 352; new text end 30.31 new text begin (3) the general state employees retirement plan of the Minnesota State Retirement new text end 30.32 new text begin System, established under chapter 352; new text end 30.33 new text begin (4) the State Patrol retirement plan, established under chapter 352B; new text end 31.1 new text begin (5) the unclassified state employees retirement program of the Minnesota State new text end 31.2 new text begin Retirement System, established under chapter 352D; new text end 31.3 new text begin (6) the judges retirement plan, established under chapter 490; new text end 31.4 new text begin (7) the general employees retirement plan of the Public Employees Retirement new text end 31.5 new text begin Association, established under chapter 353, including the MERF division of the Public new text end 31.6 new text begin Employees Retirement Association; new text end 31.7 new text begin (8) the public employees police and fire retirement plan of the Public Employees new text end 31.8 new text begin Retirement Association, established under chapter 353; new text end 31.9 new text begin (9) the local government correctional service retirement plan of the Public new text end 31.10 new text begin Employees Retirement Association, established under chapter 353E; and new text end 31.11 new text begin (10) the Teachers Retirement Association, established under chapter 354. new text end 31.12 new text begin EFFECTIVE DATE. new text end new text begin (a) For plans administered by the Minnesota State Retirement new text end 31.13 new text begin System and the Teachers Retirement Association, this section is effective July 1, 2014. new text end 31.14 new text begin (b) For plans administered by the Public Employees Retirement Association, this new text end 31.15 new text begin section applies to the determination of joint and survivor factors implemented for the new text end 31.16 new text begin applicable Public Employees Retirement Association plan effective on the same date as new text end 31.17 new text begin the next mortality assumption adjustment or on July 1, 2017, whichever is earlier. new text end 31.18    Sec. 9. Minnesota Statutes 2012, section 490.121, subdivision 2a, is amended to read: 31.19    Subd. 2a. Actuarial equivalent. new text begin (a) new text end "Actuarial equivalent" means the condition 31.20of one annuity or benefit having an equal actuarial present value as another annuity or 31.21benefit, determined as of a given date with each actuarial present value based on the 31.22appropriate mortality table adopted by the board of directors of the Minnesota State 31.23Retirement System based on the experience of the fund as recommended by the actuary 31.24retained under section 356.214 and approved under section 356.215, subdivision 18, and 31.25using the applicable preretirement or postretirement interest rate assumption specified in 31.26section 356.215, subdivision 8. 31.27 new text begin (b) For purposes of computing a joint and survivor annuity, the postretirement new text end 31.28 new text begin interest rate assumption specified in section 356.461 must be used, rather than the new text end 31.29 new text begin postretirement interest rate specified in section 356.215, subdivision 8. new text end 31.30 new text begin EFFECTIVE DATE. new text end new text begin This section is effective July 1, 2014. new text end 32.1ARTICLE 5 32.2MSRS-CORRECTIONAL RETIREMENT PLAN COVERAGE CHANGES 32.3    Section 1. Minnesota Statutes 2012, section 352.90, is amended to read: 32.4352.90 POLICY. 32.5It is the policy of the legislature to provide special retirement benefits for and special 32.6contributions by certain correctional employees who may be required to retire at an early 32.7age because they lose the mental or physical capacity required to maintain the safety, 32.8security, discipline, and custody of inmates at state correctional facilities or new text begin ; new text end of patients 32.9at new text begin in new text end the new text begin state-operated forensic services program, which is comprised of the new text end Minnesota 32.10Security Hospital, new text begin the forensic nursing home, the forensic transition service, and the new text end 32.11 new text begin competency restoration program; new text end of patients in the Minnesota sex offender program, new text begin ; new text end or of 32.12patients in the Minnesota Specialty Health System-Cambridge. 32.13    Sec. 2. Minnesota Statutes 2012, section 352.91, subdivision 1, is amended to read: 32.14    Subdivision 1. Qualifying jobs. "Covered correctional service" means service 32.15performed by a state employee, as defined in section 352.01, employed at a state 32.16correctional facility, the Minnesota Security Hospital new text begin state-operated forensic services new text end 32.17 new text begin program new text end , or the Minnesota sex offender program as: 32.18(1) a corrections officer 1; 32.19(2) a corrections officer 2; 32.20(3) a corrections officer 3; 32.21(4) a corrections officer supervisor; 32.22(5) a corrections lieutenant; 32.23(6) a corrections captain; 32.24(7) a security counselor; 32.25(8) a security counselor lead; or 32.26(9) a corrections canine officer. 32.27    Sec. 3. Minnesota Statutes 2012, section 352.91, subdivision 2, is amended to read: 32.28    Subd. 2. Maintenance, correctional industry, and trades. "Covered correctional 32.29service" also means service rendered at any time by state employees as maintenance 32.30personnel, correctional industry personnel, or members of trades certified by the 32.31commissioner of management and budget to the executive director as being engaged for at 32.32least 75 percent of the employee's working time in the rehabilitation, treatment, custody, 32.33or supervision of inmates at a Minnesota correctional facility, or of patients at new text begin in new text end the 33.1Minnesota Security Hospital new text begin state-operated forensic services program new text end or the Minnesota 33.2sex offender program. 33.3    Sec. 4. Minnesota Statutes 2012, section 352.91, subdivision 3c, is amended to read: 33.4    Subd. 3c. Nursing personnel. (a) "Covered correctional service" means service 33.5by a state employee in one of the employment positions at a correctional facility or at new text begin , new text end 33.6 new text begin in new text end the Minnesota Security Hospital new text begin state-operated forensic services program new text end , or in the 33.7Minnesota sex offender program that are specified in paragraph (b) if at least 75 percent of 33.8the employee's working time is spent in direct contact with inmates or patients and the fact 33.9of this direct contact is certified to the executive director by the appropriate commissioner. 33.10(b) The employment positions are as follows: 33.11(1) registered nurse - senior; 33.12(2) registered nurse; 33.13(3) registered nurse - principal; 33.14(4) licensed practical nurse 2; 33.15(5) registered nurse advance practice; and 33.16(6) psychiatric advance practice registered nurse. 33.17 new text begin EFFECTIVE DATE. new text end new text begin This section is effective the day following final enactment. new text end 33.18    Sec. 5. Minnesota Statutes 2012, section 352.91, subdivision 3d, is amended to read: 33.19    Subd. 3d. Other correctional personnel. (a) "Covered correctional service" 33.20means service by a state employee in one of the employment positions at a correctional 33.21facility or at new text begin in new text end the Minnesota Security Hospital new text begin state-operated forensic services program new text end 33.22 specified in paragraph (b) if at least 75 percent of the employee's working time is spent 33.23in direct contact with inmates or patients and the fact of this direct contact is certified to 33.24the executive director by the appropriate commissioner. 33.25    (b) The employment positions are: 33.26    (1) automotive mechanic; 33.27(2) baker; 33.28    (3) central services administrative specialist, intermediate; 33.29    (4) central services administrative specialist, principal; 33.30    (5) chaplain; 33.31    (6) chief cook; 33.32    (7) clinical program therapist 1; 33.33(8) clinical program therapist 2; 33.34(9) clinical program therapist 3; 34.1(10) clinical program therapist 4; 34.2(11) cook; 34.3    (12) cook coordinator; 34.4    (13) corrections inmate program coordinator; 34.5    (14) corrections transitions program coordinator; 34.6    (15) corrections security caseworker; 34.7    (16) corrections security caseworker career; 34.8    (17) corrections teaching assistant; 34.9    (18) delivery van driver; 34.10    (19) dentist; 34.11    (20) electrician supervisor; 34.12    (21) general maintenance worker lead; 34.13    (22) general repair worker; 34.14    (23) library/information research services specialist; 34.15    (24) library/information research services specialist senior; 34.16    (25) library technician; 34.17    (26) painter lead; 34.18    (27) plant maintenance engineer lead; 34.19    (28) plumber supervisor; 34.20    (29) psychologist 1; 34.21    (30) psychologist 3; 34.22    (31) recreation therapist; 34.23    (32) recreation therapist coordinator; 34.24    (33) recreation program assistant; 34.25    (34) recreation therapist senior; 34.26    (35) sports medicine specialist; 34.27    (36) work therapy assistant; 34.28    (37) work therapy program coordinator; and 34.29    (38) work therapy technician. 34.30    Sec. 6. Minnesota Statutes 2012, section 352.91, subdivision 3e, is amended to read: 34.31    Subd. 3e. Minnesota Specialty Health System-Cambridge. (a) "Covered 34.32correctional service" means service by a state employee in one of the employment positions 34.33with the Minnesota Specialty Health System-Cambridge specified in paragraph (b) if at 34.34least 75 percent of the employee's working time is spent in direct contact with patients 35.1who are in the Minnesota Specialty Health System-Cambridge and if service in such a 35.2position is certified to the executive director by the commissioner of human services. 35.3    (b) The employment positions are: 35.4    (1) behavior analyst 1; 35.5    (2) behavior analyst 2; 35.6    (3) behavior analyst 3; 35.7    (4) group supervisor; 35.8    (5) group supervisor assistant; 35.9    (6) human services support specialist; 35.10    (7) residential program lead; 35.11    (8) psychologist 2; 35.12    (9) recreation program assistant; 35.13    (10) recreation therapist senior; 35.14    (11) registered nurse senior; 35.15    (12) skills development specialist; 35.16    (13) social worker senior; 35.17    (14) social worker specialist; and 35.18    (15) speech pathology specialist. 35.19 new text begin (c) A Department of Human Services employee who was employed at the Minnesota new text end 35.20 new text begin Specialty Health System-Cambridge immediately preceding the 2014 conversion to the new text end 35.21 new text begin community-based homes and was in covered correctional service at the time of the new text end 35.22 new text begin transition shall continue to be covered by the correctional employee retirement plan while new text end 35.23 new text begin employed and without a break in service with the Department of Human Services in the new text end 35.24 new text begin direct care and treatment services administration. new text end 35.25    Sec. 7. Minnesota Statutes 2012, section 352.91, subdivision 3f, is amended to read: 35.26    Subd. 3f. Additional Department of Human Services personnel. (a) "Covered 35.27correctional service" means service by a state employee in one of the employment 35.28positions specified in paragraph (b) at new text begin in new text end the Minnesota Security Hospital new text begin state-operated new text end 35.29 new text begin forensic services program new text end or in the Minnesota sex offender program if at least 75 35.30percent of the employee's working time is spent in direct contact with patients and 35.31the determination of this direct contact is certified to the executive director by the 35.32commissioner of human services. 35.33    (b) The employment positions are: 35.34    (1) behavior analyst 2; 35.35    (2) behavior analyst 3; 36.1    (3) certified occupational therapy assistant 1; 36.2    (4) certified occupational therapy assistant 2; 36.3    (5) chemical dependency counselor senior; 36.4    (6) client advocate; 36.5     new text begin (7) clinical program therapist 2; new text end 36.6    (7) new text begin (8) new text end clinical program therapist 3; 36.7(8) new text begin (9) new text end clinical program therapist 4; 36.8(9) new text begin (10) new text end customer services specialist principal; 36.9    (10) new text begin (11) new text end dental assistant registered; 36.10    (11) new text begin (12) new text end group supervisor; 36.11    (12) new text begin (13) new text end group supervisor assistant; 36.12    (13) new text begin (14) new text end human services support specialist; 36.13    (14) new text begin (15) new text end licensed alcohol and drug counselor; 36.14    (15) new text begin (16) new text end licensed practical nurse 1; 36.15    (16) new text begin (17) new text end management analyst 3; 36.16    (17) new text begin (18) new text end occupational therapist; 36.17    (18) new text begin (19) new text end occupational therapist, senior; 36.18    (19) new text begin (20) new text end psychologist 1; 36.19    (20) new text begin (21) new text end psychologist 2; 36.20    (21) new text begin (22) new text end psychologist 3; 36.21    (22) new text begin (23) new text end recreation program assistant; 36.22    (23) new text begin (24) new text end recreation therapist lead; 36.23    (24) new text begin (25) new text end recreation therapist senior; 36.24    (25) new text begin (26) new text end rehabilitation counselor senior; 36.25    (26) new text begin (27) new text end security supervisor; 36.26    (27) new text begin (28) new text end skills development specialist; 36.27    (28) new text begin (29) new text end social worker senior; 36.28    (29) new text begin (30) new text end social worker specialist; 36.29    (30) new text begin (31) new text end social worker specialist, senior; 36.30    (31) new text begin (32) new text end special education program assistant; 36.31    (32) new text begin (33) new text end speech pathology clinician; 36.32    (33) new text begin (34) new text end work therapy assistant; and 36.33    (34) new text begin (35) new text end work therapy program coordinator. 36.34    Sec. 8. Minnesota Statutes 2012, section 352.91, is amended by adding a subdivision 36.35to read: 37.1     new text begin Subd. 3j. new text end new text begin State-operated forensic services program. new text end new text begin For purposes of this section, new text end 37.2 new text begin "state-operated forensic services program" means the Minnesota Security Hospital, the new text end 37.3 new text begin forensic nursing home, the forensic transition service, and the competency restoration new text end 37.4 new text begin program. new text end 37.5ARTICLE 6 37.6TRA-DTRFA CONSOLIDATION 37.7    Section 1. Minnesota Statutes 2012, section 13.632, subdivision 1, is amended to read: 37.8    Subdivision 1. Beneficiary and survivor data. The following data on beneficiaries 37.9and survivors of the St. Paul Teachers Retirement Fund Association and the Duluth 37.10Teachers Retirement Fund Association members are private data on individuals: home 37.11address, date of birth, direct deposit number, and tax withholding data. 37.12    Sec. 2. Minnesota Statutes 2012, section 122A.18, subdivision 7a, is amended to read: 37.13    Subd. 7a. Permission to substitute teach. (a) The Board of Teaching may allow a 37.14person who is enrolled in and making satisfactory progress in a board-approved teacher 37.15program and who has successfully completed student teaching to be employed as a 37.16short-call substitute teacher. 37.17(b) The Board of Teaching may issue a lifetime qualified short-call substitute 37.18teaching license to a person who: 37.19(1) was a qualified teacher under section 122A.16 while holding a continuing 37.20five-year teaching license issued by the board, and receives a retirement annuity from the 37.21Teachers Retirement Association, Minneapolis Teachers Retirement Fund Association, 37.22 new text begin or the new text end St. Paul Teachers Retirement Fund Association, or Duluth Teachers Retirement 37.23Fund Association; 37.24(2) holds an out-of-state teaching license and receives a retirement annuity as a 37.25result of the person's teaching experience; or 37.26(3) held a continuing five-year license issued by the board, taught at least three 37.27school years in an accredited nonpublic school in Minnesota, and receives a retirement 37.28annuity as a result of the person's teaching experience. 37.29A person holding a lifetime qualified short-call substitute teaching license is not required 37.30to complete continuing education clock hours. A person holding this license may reapply 37.31to the board for a continuing five-year license and must again complete continuing 37.32education clock hours one school year after receiving the continuing five-year license. 38.1    Sec. 3. Minnesota Statutes 2013 Supplement, section 353.01, subdivision 2b, is 38.2amended to read: 38.3    Subd. 2b. Excluded employees. (a) The following public employees are not eligible 38.4to participate as members of the association with retirement coverage by the general 38.5employees retirement plan, the local government correctional employees retirement plan 38.6under chapter 353E, or the public employees police and fire retirement plan: 38.7    (1) persons whose salary from one governmental subdivision never exceeds $425 in 38.8a month; 38.9(2) public officers who are elected to a governing body, city mayors, or persons who 38.10are appointed to fill a vacancy in an elective office of a governing body, whose term of office 38.11commences on or after July 1, 2002, for the service to be rendered in that elective position; 38.12    (3) election officers or election judges; 38.13    (4) patient and inmate personnel who perform services for a governmental 38.14subdivision; 38.15    (5) except as otherwise specified in subdivision 12a, employees who are hired for 38.16a temporary position as defined under subdivision 12a, and employees who resign from 38.17a nontemporary position and accept a temporary position within 30 days in the same 38.18governmental subdivision; 38.19    (6) employees who are employed by reason of work emergency caused by fire, 38.20flood, storm, or similar disaster; 38.21    (7) employees who by virtue of their employment in one governmental subdivision 38.22are required by law to be a member of and to contribute to any of the plans or funds 38.23administered by the Minnesota State Retirement System, the Teachers Retirement 38.24Association, the Duluth Teachers Retirement Fund Association, and the St. Paul Teachers 38.25Retirement Fund Association. This clause must not be construed to prevent a person from 38.26being a member of and contributing to the Public Employees Retirement Association and 38.27also belonging to and contributing to another public pension plan or fund for other service 38.28occurring during the same period of time. A person who meets the definition of "public 38.29employee" in subdivision 2 by virtue of other service occurring during the same period of 38.30time becomes a member of the association unless contributions are made to another public 38.31retirement fund on the salary based on the other service or to the Teachers Retirement 38.32Association by a teacher as defined in section 354.05, subdivision 2; 38.33    (8) persons who are members of a religious order and are excluded from coverage 38.34under the federal Old Age, Survivors, Disability, and Health Insurance Program for the 38.35performance of service as specified in United States Code, title 42, section 410(a)(8)(A), 39.1as amended through January 1, 1987, if no irrevocable election of coverage has been made 39.2under section 3121(r) of the Internal Revenue Code of 1954, as amended; 39.3    (9) employees of a governmental subdivision who have not reached the age of 39.423 and are enrolled on a full-time basis to attend or are attending classes on a full-time 39.5basis at an accredited school, college, or university in an undergraduate, graduate, or 39.6professional-technical program, or a public or charter high school; 39.7    (10) resident physicians, medical interns, and pharmacist residents and pharmacist 39.8interns who are serving in a degree or residency program in public hospitals or clinics; 39.9    (11) students who are serving for up to five years in an internship or residency program 39.10sponsored by a governmental subdivision, including an accredited educational institution; 39.11    (12) persons who hold a part-time adult supplementary technical college license who 39.12render part-time teaching service in a technical college; 39.13    (13) except for employees of Hennepin County or Hennepin Healthcare System, Inc., 39.14foreign citizens who are employed by a governmental subdivision under a work permit, or 39.15an H-1b visa initially issued or extended for a combined period less than three years of 39.16employment. Upon extension of the employment beyond the three-year period, the foreign 39.17citizens must be reported for membership beginning the first of the month thereafter 39.18provided the monthly earnings threshold as provided under subdivision 2a is met; 39.19    (14) public hospital employees who elected not to participate as members of the 39.20association before 1972 and who did not elect to participate from July 1, 1988, to October 39.211, 1988; 39.22    (15) except as provided in section 353.86, volunteer ambulance service personnel, as 39.23defined in subdivision 35, but persons who serve as volunteer ambulance service personnel 39.24may still qualify as public employees under subdivision 2 and may be members of the 39.25Public Employees Retirement Association and participants in the general employees 39.26retirement plan or the public employees police and fire plan, whichever applies, on the 39.27basis of compensation received from public employment service other than service as 39.28volunteer ambulance service personnel; 39.29    (16) except as provided in section 353.87, volunteer firefighters, as defined in 39.30subdivision 36, engaging in activities undertaken as part of volunteer firefighter duties, 39.31but a person who is a volunteer firefighter may still qualify as a public employee under 39.32subdivision 2 and may be a member of the Public Employees Retirement Association and 39.33a participant in the general employees retirement plan or the public employees police 39.34and fire plan, whichever applies, on the basis of compensation received from public 39.35employment activities other than those as a volunteer firefighter; 40.1    (17) pipefitters and associated trades personnel employed by Independent School 40.2District No. 625, St. Paul, with coverage under a collective bargaining agreement by the 40.3pipefitters local 455 pension plan who were either first employed after May 1, 1997, or, 40.4if first employed before May 2, 1997, elected to be excluded under Laws 1997, chapter 40.5241, article 2, section 12; 40.6    (18) electrical workers, plumbers, carpenters, and associated trades personnel who 40.7are employed by Independent School District No. 625, St. Paul, or the city of St. Paul, 40.8who have retirement coverage under a collective bargaining agreement by the Electrical 40.9Workers Local 110 pension plan, the United Association Plumbers Local 34 pension plan, 40.10or the pension plan applicable to Carpenters Local 87 who were either first employed after 40.11May 1, 2000, or, if first employed before May 2, 2000, elected to be excluded under 40.12Laws 2000, chapter 461, article 7, section 5; 40.13    (19) bricklayers, allied craftworkers, cement masons, glaziers, glassworkers, 40.14painters, allied tradesworkers, and plasterers who are employed by the city of St. Paul 40.15or Independent School District No. 625, St. Paul, with coverage under a collective 40.16bargaining agreement by the Bricklayers and Allied Craftworkers Local 1 pension plan, 40.17the Cement Masons Local 633 pension plan, the Glaziers and Glassworkers Local L-1324 40.18pension plan, the Painters and Allied Trades Local 61 pension plan, or the Twin Cities 40.19Plasterers Local 265 pension plan who were either first employed after May 1, 2001, or if 40.20first employed before May 2, 2001, elected to be excluded under Laws 2001, First Special 40.21Session chapter 10, article 10, section 6; 40.22    (20) plumbers who are employed by the Metropolitan Airports Commission, with 40.23coverage under a collective bargaining agreement by the Plumbers Local 34 pension plan, 40.24who either were first employed after May 1, 2001, or if first employed before May 2, 40.252001, elected to be excluded under Laws 2001, First Special Session chapter 10, article 40.2610, section 6; 40.27    (21) employees who are hired after June 30, 2002, to fill seasonal positions under 40.28subdivision 12b which are limited in duration by the employer to 185 consecutive calendar 40.29days or less in each year of employment with the governmental subdivision; 40.30    (22) persons who are provided supported employment or work-study positions by a 40.31governmental subdivision and who participate in an employment or industries program 40.32maintained for the benefit of these persons where the governmental subdivision limits the 40.33position's duration to up to five years, including persons participating in a federal or state 40.34subsidized on-the-job training, work experience, senior citizen, youth, or unemployment 40.35relief program where the training or work experience is not provided as a part of, or 40.36for, future permanent public employment; 41.1    (23) independent contractors and the employees of independent contractors; 41.2    (24) reemployed annuitants of the association during the course of that 41.3reemployment; and 41.4(25) persons appointed to serve on a board or commission of a governmental 41.5subdivision or an instrumentality thereof. 41.6(b) Any person performing the duties of a public officer in a position defined in 41.7subdivision 2a, paragraph (a), clause (3), is not an independent contractor and is not an 41.8employee of an independent contractor. 41.9    Sec. 4. Minnesota Statutes 2012, section 354.05, subdivision 2, is amended to read: 41.10    Subd. 2. Teacher. (a) "Teacher" means: 41.11(1) a person who renders service as a teacher, supervisor, principal, superintendent, 41.12librarian, nurse, counselor, social worker, therapist, or psychologist in a public school of 41.13the state located outside of the corporate limits of the city of Duluth or the city of St. Paul, 41.14or in any charter school, irrespective of the location of the school, or in any charitable, 41.15penal, or correctional institutions of a governmental subdivision, or who is engaged in 41.16educational administration in connection with the state public school system, but excluding 41.17the University of Minnesota, whether the position be a public office or an employment, and 41.18not including the members or officers of any general governing or managing board or body; 41.19(2) an employee of the Teachers Retirement Association; 41.20(3) a person who renders teaching service on a part-time basis and who also renders 41.21other services for a single employing unit. A person whose teaching service comprises at 41.22least 50 percent of the combined employment salary is a member of the association for all 41.23services with the single employing unit. If the person's teaching service comprises less 41.24than 50 percent of the combined employment salary, the executive director must determine 41.25whether all or none of the combined service is covered by the association; or 41.26(4) a person who is not covered by the plans established under chapter 352D, 354A, 41.27or 354B and who is employed by the Board of Trustees of the Minnesota State Colleges 41.28and Universities system in an unclassified position as: 41.29(i) a president, vice-president, or dean; 41.30(ii) a manager or a professional in an academic or an academic support program 41.31other than specified in item (i); 41.32(iii) an administrative or a service support faculty position; or 41.33(iv) a teacher or a research assistant. 41.34(b) "Teacher" does not mean: 42.1(1) a person who works for a school or institution as an independent contractor as 42.2defined by the Internal Revenue Service; 42.3(2) a person who renders part-time teaching service or who is a customized trainer 42.4as defined by the Minnesota State Colleges and Universities system if (i) the service is 42.5incidental to the regular nonteaching occupation of the person; and (ii) the employer 42.6stipulates annually in advance that the part-time teaching service or customized training 42.7service will not exceed 300 hours in a fiscal year and retains the stipulation in its records; 42.8and (iii) the part-time teaching service or customized training service actually does not 42.9exceed 300 hours in a fiscal year; or 42.10(3) a person exempt from licensure under section 122A.30. 42.11    Sec. 5. Minnesota Statutes 2012, section 354.05, subdivision 13, is amended to read: 42.12    Subd. 13. Allowable service. "Allowable service" means: 42.13    (1) any service rendered by a teacher for which on or before July 1, 1957, the 42.14teacher's account in the retirement fund was credited by reason of employee contributions 42.15in the form of salary deductions, payments in lieu of salary deductions, or in any other 42.16manner authorized by Minnesota Statutes 1953, sections 135.01 to 135.13, as amended by 42.17Laws 1955, chapters 361, 549, 550, 611, or new text begin ; new text end 42.18    (2) any service rendered by a teacher for which on or before July 1, 1961, the teacher 42.19elected to obtain credit for service by making payments to the fund pursuant to new text begin under new text end 42.20Minnesota Statutes 1980, section 354.09 and section 354.51, or new text begin ; new text end 42.21    (3) any service rendered by a teacher after July 1, 1957, for any calendar month 42.22when the member receives salary from which deductions are made, deposited and credited 42.23in the fund, or new text begin ; new text end 42.24    (4) any service rendered by a person after July 1, 1957, for any calendar month where 42.25payments in lieu of salary deductions are made, deposited and credited into the fund as 42.26provided in Minnesota Statutes 1980, section 354.09, subdivision 4, and section 354.53, or new text begin ; new text end 42.27    (5) any service rendered by a teacher for which the teacher elected to obtain credit 42.28for service by making payments to the fund pursuant to new text begin under new text end Minnesota Statutes 1980, 42.29section 354.09, subdivisions 1 and 4, sections 354.50, 354.51, Minnesota Statutes 1957, 42.30section 135.41, subdivision 4, Minnesota Statutes 1971, section 354.09, subdivision 2, or 42.31Minnesota Statutes, 1973 Supplement, section 354.09, subdivision 3, or new text begin ; new text end 42.32    (6) both service during years of actual membership in the course of which 42.33contributions were currently made and service in years during which the teacher was not a 42.34member but for which the teacher later elected to obtain credit by making payments to the 42.35fund as permitted by any law then in effect, or new text begin ; new text end 43.1    (7) any service rendered where contributions were made and no credit was 43.2established because of the limitations contained in Minnesota Statutes 1957, section 43.3135.09, subdivision 2, as determined by the ratio between the amounts of money credited 43.4to the teacher's account in a fiscal year and the maximum retirement contribution allowable 43.5for that year, or new text begin ; new text end 43.6    (8) MS 2002 [Expired] 43.7    (9) a period of time during which a teacher was on strike without pay, not to exceed a 43.8period of one year, if payment in lieu of salary deductions is made under section 354.72, or new text begin ; new text end 43.9    (10) a period of service before July 1, 2006, that was properly credited as allowable 43.10service by the Minneapolis Teachers Retirement Fund Association, and that was rendered 43.11by a teacher as an employee of Special School District No. 1, Minneapolis, or by an 43.12employee of the Minneapolis Teachers Retirement Fund Association who was a member 43.13of the Minneapolis Teachers Retirement Fund Association by virtue of that employment, 43.14who has not begun receiving an annuity or other retirement benefit from the former 43.15Minneapolis Teachers Retirement Fund Association calculated in whole or in part on that 43.16service before July 1, 2006, and who has not taken a refund of member contributions 43.17related to that service unless the refund is repaid under section 354.50, subdivision 4. 43.18Service as an employee of Special School District No. 1, Minneapolis, on or after July 1, 43.192006, is "allowable service" only as provided by this chapter. new text begin ; or new text end 43.20 new text begin (11) a period of service before July 1, 2015, that was properly credited as allowable new text end 43.21 new text begin service by the Duluth Teachers Retirement Fund Association, and that was rendered new text end 43.22 new text begin by a teacher as an employee of Independent School District No. 709, Duluth, or by an new text end 43.23 new text begin employee of the Duluth Teachers Retirement Fund Association who was a member of the new text end 43.24 new text begin Duluth Teachers Retirement Fund Association by virtue of that employment, who has not new text end 43.25 new text begin begun receiving an annuity or other retirement benefit from the former Duluth Teachers new text end 43.26 new text begin Retirement Fund Association calculated in whole or in part on that service before July new text end 43.27 new text begin 1, 2015, and who has not taken a refund of member contributions related to that service new text end 43.28 new text begin unless the refund is repaid under section new text end new text begin , subdivision 4. Service as an employee new text end 43.29 new text begin of Independent School District No. 709, Duluth, on or after July 1, 2015, is "allowable new text end 43.30 new text begin service" only as provided by this chapter. new text end 43.31    Sec. 6. Minnesota Statutes 2012, section 354.42, subdivision 2, is amended to read: 43.32    Subd. 2. Employee contribution. (a) For a basic member, The employee 43.33contribution to the fund is the following percentage of the member's salary: 43.34 new text begin Period new text end new text begin Basic Program new text end new text begin Coordinated Program new text end 43.35 before July 1, 2011 9.0 percent 44.1 from July 1, 2011, until June 30, 2012 9.5 percent 44.2 from July 1, 2012, until June 30, 2013 10.0 percent 44.3 from July 1, 2013, until June 30, 2014 10.5 percent new text begin 7.0 percent new text end 44.4 after June 30, 2014 11.0 percent new text begin 7.5 percent new text end 44.5(b) For a coordinated member, the employee contribution is the following percentage 44.6of the member's salary: 44.7 before July 1, 2011 5.5 percent 44.8 from July 1, 2011, until June 30, 2012 6.0 percent 44.9 from July 1, 2012, until June 30, 2013 6.5 percent 44.10 from July 1, 2013, until June 30, 2014 7.0 percent 44.11 after June 30, 2014 7.5 percent 44.12(c) new text begin (b) new text end When an employee contribution rate changes for a fiscal year, the new 44.13contribution rate is effective for the entire salary paid for each employer unit with the 44.14first payroll cycle reported. 44.15(d) new text begin (c) new text end After June 30, 2015, if a contribution rate revision is required under 44.16subdivisions 4a, 4b, and 4c, the employee contributions under paragraphs (a) and (b) must 44.17be adjusted accordingly. 44.18(e) new text begin (d) new text end This contribution must be made by deduction from salary. Where any portion 44.19of a member's salary is paid from other than public funds, the member's employee 44.20contribution must be based on the entire salary received. 44.21    Sec. 7. Minnesota Statutes 2012, section 354.42, subdivision 3, is amended to read: 44.22    Subd. 3. Employer. (a) The regular employer contribution to the fund by Special 44.23School District No. 1, Minneapolis, is an amount equal to the applicable following 44.24percentage of salary of each coordinated member and the applicable following percentage 44.25of salary of each basic member: new text begin specified in paragraph (c). new text end 44.26 Period Coordinated Member Basic Member 44.27 before July 1, 2011 5.5 percent 9.5 percent 44.28 from July 1, 2011, until June 30, 2012 6.0 percent 10.0 percent 44.29 from July 1, 2012, until June 30, 2013 6.5 percent 10.5 percent 44.30 from July 1, 2013, until June 30, 2014 7.0 percent 11.0 percent 44.31 after June 30, 2014 7.5 percent 11.5 percent 44.32The additional employer contribution to the fund by Special School District No. 1, 44.33Minneapolis, is an amount equal to 3.64 percent of the salary of each teacher who is a 44.34coordinated member or new text begin who new text end is a basic member. 45.1 new text begin (b) The regular employer contribution to the fund by Independent School District new text end 45.2 new text begin No. 709, Duluth, is an amount equal to the applicable percentage of salary of each old law new text end 45.3 new text begin or new law coordinated member specified for the coordinated program in paragraph (c). new text end 45.4(b) new text begin (c) new text end The employer contribution to the fund for every other employer is an amount 45.5equal to the applicable following percentage of the salary of each coordinated member and 45.6the applicable following percentage of the salary of each basic member: 45.7 Period Coordinated Member Basic Member 45.8 before July 1, 2011 5.5 percent 9.5 percent 45.9 from July 1, 2011, until June 30, 2012 6.0 percent 10.0 percent 45.10 from July 1, 2012, until June 30, 2013 6.5 percent 10.5 percent 45.11 from July 1, 2013, until June 30, 2014 7.0 percent 11.0 percent 45.12 after June 30, 2014 7.5 percent 11.5 percent 45.13(c) new text begin (d) new text end When an employer contribution rate changes for a fiscal year, the new 45.14contribution rate is effective for the entire salary paid for each employer unit with the 45.15first payroll cycle reported. 45.16(d) new text begin (e) new text end After June 30, 2015, if a contribution rate revision is made under subdivisions 45.174a, 4b, and 4c, the employer contributions under paragraphs (a) and new text begin , new text end (b) new text begin , and (c) new text end must 45.18be adjusted accordingly. 45.19    Sec. 8. Minnesota Statutes 2013 Supplement, section 354.436, is amended to read: 45.20354.436 DIRECT STATE AID ON BEHALF OF THE FORMER 45.21MINNEAPOLIS new text begin FIRST CLASS CITY new text end TEACHERS RETIREMENT FUND 45.22ASSOCIATION new text begin ASSOCIATIONS new text end . 45.23    Subdivision 1. Aid authorization. The state shall pay $12,954,000 to the Teachers 45.24Retirement Association on behalf of the former Minneapolis Teachers Retirement Fund 45.25Association new text begin and in fiscal year 2017 and later shall pay $14,377,000 on behalf of the Duluth new text end 45.26 new text begin Teachers Retirement Fund Association new text end . 45.27    Subd. 2. Aid appropriation. The commissioner of management and budget shall 45.28pay the aid new text begin amounts under subdivision 1 new text end annually on October 1. The amount required 45.29is appropriated annually from the general fund to the commissioner of management and 45.30budget. 45.31    Subd. 3. Aid expiration. The aid new text begin amounts new text end specified in this section terminates 45.32 new text begin terminate new text end and this section expires new text begin on the October 1 next following the later of the new text end 45.33 new text begin following dates: (1) new text end when the current assets of the Teachers Retirement Association fund 45.34equal or exceed the actuarial accrued liabilities of the fund as determined in the most 45.35recent actuarial valuation report for the Teachers Retirement Association fund by the 45.36actuary retained under section 356.214, or on the established date for full funding under 46.1section 356.215, subdivision 11, whichever occurs earlier new text begin ; or (2) when the member and new text end 46.2 new text begin employer contribution rates are first determined to be eligible for a reduction under section new text end 46.3 new text begin 354.42, subdivisions 4a, 4b, 4c, and 4d new text end . 46.4    Sec. 9. Minnesota Statutes 2013 Supplement, section 354.44, subdivision 6, is 46.5amended to read: 46.6    Subd. 6. Computation of formula program retirement annuity. (a) The formula 46.7retirement annuity must be computed in accordance with the applicable provisions of the 46.8formulas stated in paragraph (b) or (d) on the basis of each member's average salary under 46.9section 354.05, subdivision 13a, for the period of the member's formula service credit. 46.10    (b) This paragraph, in conjunction with paragraph (c), applies to a person who first 46.11became a member of the association or a member of a pension fund listed in section 46.12356.30, subdivision 3 , before July 1, 1989, unless paragraph (d), in conjunction with 46.13paragraph (e), produces a higher annuity amount, in which case paragraph (d) applies. The 46.14average salary as defined in section 354.05, subdivision 13a, multiplied by the following 46.15percentages per year of formula service credit shall determine the amount of the annuity to 46.16which the member qualifying therefor is entitled for service rendered before July 1, 2006: 46.17 new text begin Period new text end Coordinated Member Basic Member 46.18 46.19 Each year of service during first ten 1.2 percent per year 2.2 percent per year 46.20 46.21 Each year of service thereafter 1.7 percent per year 2.7 percent per year 46.22    For service rendered on or after July 1, 2006, new text begin by a member other than a member new text end 46.23 new text begin who was a member of the former Duluth Teachers Retirement Fund Association between new text end 46.24 new text begin January 1, 2006, and June 30, 2015, and for service rendered on or after July 1, 2013, by a new text end 46.25 new text begin member who was a member of the former Duluth Teachers Retirement Fund Association new text end 46.26 new text begin between January 1, 2013, and June 30, 2015, new text end the average salary as defined in section 46.27354.05 , subdivision 13a, multiplied by the following percentages per year of service credit, 46.28determines the amount the annuity to which the member qualifying therefor is entitled: 46.29 new text begin Period new text end Coordinated Member Basic Member 46.30 46.31 Each year of service during first ten 1.4 percent per year 2.2 percent per year 46.32 46.33 Each year of service after ten years of service 1.9 percent per year 2.7 percent per year 46.34    (c)(i) This paragraph applies only to a person who first became a member of the 46.35association or a member of a pension fund listed in section 356.30, subdivision 3, before 46.36July 1, 1989, and whose annuity is higher when calculated under paragraph (b), in 47.1conjunction with this paragraph than when calculated under paragraph (d), in conjunction 47.2with paragraph (e). 47.3    (ii) Where any member retires prior to normal retirement age under a formula 47.4annuity, the member shall be paid a retirement annuity in an amount equal to the normal 47.5annuity provided in paragraph (b) reduced by one-quarter of one percent for each month 47.6that the member is under normal retirement age at the time of retirement except that for 47.7any member who has 30 or more years of allowable service credit, the reduction shall be 47.8applied only for each month that the member is under age 62. 47.9    (iii) Any member whose attained age plus credited allowable service totals 90 years 47.10is entitled, upon application, to a retirement annuity in an amount equal to the normal 47.11annuity provided in paragraph (b), without any reduction by reason of early retirement. 47.12    (d) This paragraph applies to a member who has become at least 55 years old and 47.13first became a member of the association after June 30, 1989, and to any other member 47.14who has become at least 55 years old and whose annuity amount when calculated under 47.15this paragraph and in conjunction with paragraph (e), is higher than it is when calculated 47.16under paragraph (b), in conjunction with paragraph (c). For a basic member, the average 47.17salary, as defined in section 354.05, subdivision 13a, multiplied by 2.7 percent for each 47.18year of service for a basic member determines the amount of the retirement annuity to 47.19which the basic member is entitled. The annuity of a basic member who was a member of 47.20the former Minneapolis Teachers Retirement Fund Association as of June 30, 2006, must 47.21be determined according to the annuity formula under the articles of incorporation of the 47.22former Minneapolis Teachers Retirement Fund Association in effect as of that date. For a 47.23coordinated member, the average salary, as defined in section 354.05, subdivision 13a, 47.24multiplied by 1.7 percent for each year of service rendered before July 1, 2006, and by 1.9 47.25percent for each year of service rendered on or after July 1, 2006, new text begin for a member other than new text end 47.26 new text begin a member who was a member of the former Duluth Teachers Retirement Fund Association new text end 47.27 new text begin between January 1, 2006, and June 30, 2015, and by 1.9 percent for each year of service new text end 47.28 new text begin rendered on or after July 1, 2013, for a member of the former Duluth Teachers Retirement new text end 47.29 new text begin Fund Association between January 1, 2013, and June 30, 2015, new text end determines the amount of 47.30the retirement annuity to which the coordinated member is entitled. 47.31    (e) This paragraph applies to a person who has become at least 55 years old and first 47.32becomes a member of the association after June 30, 1989, and to any other member who 47.33has become at least 55 years old and whose annuity is higher when calculated under 47.34paragraph (d) in conjunction with this paragraph than when calculated under paragraph 47.35(b), in conjunction with paragraph (c). An employee who retires under the formula annuity 47.36before the normal retirement age shall be paid the normal annuity provided in paragraph 48.1(d) reduced so that the reduced annuity is the actuarial equivalent of the annuity that 48.2would be payable to the employee if the employee deferred receipt of the annuity and the 48.3annuity amount were augmented at an annual rate of three percent compounded annually 48.4from the day the annuity begins to accrue until the normal retirement age if the employee 48.5became an employee before July 1, 2006, and at 2.5 percent compounded annually if the 48.6employee becomes an employee after June 30, 2006. Except in regards to section 354.46, 48.7this paragraph remains in effect until June 30, 2015. 48.8(f) After June 30, 2020, this paragraph applies to a person who has become at least 48.955 years old and first becomes a member of the association after June 30, 1989, and to any 48.10other member who has become at least 55 years old and whose annuity is higher when 48.11calculated under paragraph (d) in conjunction with this paragraph than when calculated 48.12under paragraph (b) in conjunction with paragraph (c). An employee who retires under 48.13the formula annuity before the normal retirement age is entitled to receive the normal 48.14annuity provided in paragraph (d). For a person who is at least age 62 or older and has at 48.15least 30 years of service, the annuity must be reduced by an early reduction factor of six 48.16percent per year of the annuity that would be payable to the employee if the employee 48.17deferred receipt of the annuity and the annuity amount were augmented at an annual rate 48.18of three percent compounded annually from the day the annuity begins to accrue until the 48.19normal retirement age if the employee became an employee before July 1, 2006, and at 2.5 48.20percent compounded annually if the employee became an employee after June 30, 2006. 48.21For a person who is not at least age 62 or older and does not have at least 30 years of 48.22service, the annuity would be reduced by an early reduction factor of four percent per year 48.23for ages 55 through 59 and seven percent per year of the annuity that would be payable 48.24to the employee if the employee deferred receipt of the annuity and the annuity amount 48.25were augmented at an annual rate of three percent compounded annually from the day 48.26the annuity begins to accrue until the normal retirement age if the employee became an 48.27employee before July 1, 2006, and at 2.5 percent compounded annually if the employee 48.28became an employee after June 30, 2006. 48.29(g) After June 30, 2015, and before July 1, 2020, for a person who would have 48.30a reduced retirement annuity under either paragraph (e) or (f) if they were applicable, 48.31the employee is entitled to receive a reduced annuity which must be calculated using 48.32a blended reduction factor augmented monthly by 1/60 of the difference between the 48.33reduction required under paragraph (e) and the reduction required under paragraph (f). 48.34    (h) No retirement annuity is payable to a former employee with a salary that exceeds 48.3595 percent of the governor's salary unless and until the salary figures used in computing 48.36the highest five successive years average salary under paragraph (a) have been audited by 49.1the Teachers Retirement Association and determined by the executive director to comply 49.2with the requirements and limitations of section 354.05, subdivisions 35 and 35a. 49.3    Sec. 10. new text begin [354.73] RETIREMENT COVERAGE RELATED TO THE FORMER new text end 49.4 new text begin DULUTH TEACHERS RETIREMENT FUND ASSOCIATION. new text end 49.5     new text begin Subdivision 1. new text end new text begin Application. new text end new text begin This section applies to the retirement coverage of new text end 49.6 new text begin members of the former Duluth Teachers Retirement Fund Association transferred to the new text end 49.7 new text begin Teachers Retirement Association by section 46. new text end 49.8     new text begin Subd. 2. new text end new text begin Teachers Retirement Association as successor in interest. new text end new text begin The Teachers new text end 49.9 new text begin Retirement Association is the successor in interest to all claims which the former Duluth new text end 49.10 new text begin Teachers Retirement Fund Association may have or may have been able to assert against new text end 49.11 new text begin any person on June 30, 2015, and is the successor in interest to all claims which could new text end 49.12 new text begin have been asserted against the former Duluth Teachers Retirement Fund Association, new text end 49.13 new text begin subject to the following: new text end 49.14 new text begin (1) the Teachers Retirement Association is not liable for any claim against the new text end 49.15 new text begin Duluth Teachers Retirement Fund Association, its former board or board members, which new text end 49.16 new text begin is founded upon a claim of breach of fiduciary duty, where the act or acts constituting the new text end 49.17 new text begin claimed breach were not done in good faith; new text end 49.18 new text begin (2) the Teachers Retirement Association may assert any applicable defense to new text end 49.19 new text begin any claim in any judicial or administrative proceeding that the former Duluth Teachers new text end 49.20 new text begin Retirement Fund Association or its board would otherwise have been entitled to assert; new text end 49.21 new text begin (3) the Teachers Retirement Association may assert any applicable defense that it new text end 49.22 new text begin may assert in its capacity as a statewide agency; and new text end 49.23 new text begin (4) the Teachers Retirement Association shall indemnify any former fiduciary of the new text end 49.24 new text begin Duluth Teachers Retirement Fund Association consistent with section new text end new text begin . new text end 49.25     new text begin Subd. 3. new text end new text begin Benefit calculation. new text end new text begin (a) For every deferred, inactive, disabled, and new text end 49.26 new text begin retired member of the Duluth Teachers Retirement Fund Association transferred under new text end 49.27 new text begin subdivision 1, and the survivors of these members, annuities or benefits earned before July new text end 49.28 new text begin 1, 2015, other than future postretirement adjustments, must be calculated and paid by the new text end 49.29 new text begin Teachers Retirement Association under the laws, articles of incorporation, and bylaws of new text end 49.30 new text begin the former Duluth Teachers Retirement Fund Association that were in effect relative to new text end 49.31 new text begin the person on the date of the person's termination of active service covered by the former new text end 49.32 new text begin Duluth Teachers Retirement Fund Association. new text end 49.33 new text begin (b) Former Duluth Teachers Retirement Fund Association members who retired new text end 49.34 new text begin before July 1, 2015, must receive postretirement adjustments after January 1, 2015, only new text end 49.35 new text begin as provided in section new text end new text begin . All other benefit recipients of the former Duluth Teachers new text end 50.1 new text begin Retirement Fund Association must receive postretirement adjustments after December 31, new text end 50.2 new text begin 2015, only as provided in section new text end new text begin . new text end 50.3 new text begin (c) This consolidation does not impair or diminish benefits for an active, deferred, new text end 50.4 new text begin or retired member or a survivor of an active, deferred, or retired member under the new text end 50.5 new text begin former Duluth Teachers Retirement Fund Association in existence at the time of the new text end 50.6 new text begin consolidation, except that any future postretirement adjustments must be paid after July 1, new text end 50.7 new text begin 2015, in accordance with paragraph (b), and all benefits based on service on or after July new text end 50.8 new text begin 1, 2015, must be determined only by laws governing the Teachers Retirement Association. new text end 50.9    Sec. 11. Minnesota Statutes 2012, section 354A.011, subdivision 11, is amended to read: 50.10    Subd. 11. Coordinated member. "Coordinated member" means any member of the 50.11teachers retirement fund association who is covered by any agreement or modification 50.12made between the state and the Secretary of Health, Education and Welfare making the 50.13provisions of the federal Old Age, Survivors and Disability Insurance Act applicable 50.14to certain teachers except in the case of a member of the Duluth Teachers Retirement 50.15Fund Association, in which it means additionally that the member either first became a 50.16member prior to July 1, 1981, and elected to be covered by the new law coordinated 50.17program of the Duluth Teachers Retirement Fund Association or first became a member 50.18on or subsequent to July 1, 1981. 50.19    Sec. 12. Minnesota Statutes 2012, section 354A.011, subdivision 15a, is amended to 50.20read: 50.21    Subd. 15a. Normal retirement age. "Normal retirement age" means age 65 for a 50.22person who first became a member of the coordinated program of the St. Paul Teachers 50.23Retirement Fund Association or the new law coordinated program of the Duluth Teachers 50.24Retirement Fund Association or a member of a pension fund listed in section 356.30, 50.25subdivision 3 , before July 1, 1989. For a person who first became a member of the 50.26coordinated program of the St. Paul Teachers Retirement Fund Association or the new law 50.27coordinated program of the Duluth Teachers Retirement Fund Association after June 30, 50.281989, normal retirement age means the higher of age 65 or retirement age, as defined in 50.29United States Code, title 42, section 416(l), as amended, but not to exceed age 66. For a 50.30person who is a member of the basic program of the St. Paul Teachers Retirement Fund 50.31Association or the old law coordinated program of the Duluth Teachers Retirement Fund 50.32Association, normal retirement age means the age at which a teacher becomes eligible for 50.33a normal retirement annuity computed upon meeting the age and service requirements 51.1specified in the applicable provisions of the articles of incorporation or bylaws of the 51.2respective teachers retirement fund association. 51.3    Sec. 13. Minnesota Statutes 2012, section 354A.011, subdivision 27, is amended to read: 51.4    Subd. 27. Teacher. (a) "Teacher" means any person who renders service for a public 51.5school district, other than a charter school, located in the corporate limits of Duluth or 51.6 St. Paul, as any of the following: 51.7(1) a full-time employee in a position for which a valid license from the state 51.8Department of Education is required; 51.9(2) an employee of the teachers retirement fund association located in the city of the 51.10first class new text begin St. Paul new text end ; 51.11(3) a part-time employee in a position for which a valid license from the state 51.12Department of Education is required; or 51.13(4) a part-time employee in a position for which a valid license from the state 51.14Department of Education is required who also renders other nonteaching services for the 51.15school district, unless the board of trustees of the teachers retirement fund association 51.16determines that the combined employment is on the whole so substantially dissimilar to 51.17teaching service that the service may not be covered by the association. 51.18(b) The term does not mean any person who renders service in the school district 51.19as any of the following: 51.20(1) an independent contractor or the employee of an independent contractor; 51.21(2) an employee who is a full-time teacher covered by the Teachers Retirement 51.22Association or by another teachers retirement fund association established pursuant to 51.23this chapter or new text begin under new text end chapter 354; 51.24(3) an employee who is exempt from licensure pursuant to section 122A.30; 51.25(4) an employee who is a teacher in a technical college located in a city of the first 51.26class unless the person elects coverage by the applicable first class city teacher retirement 51.27fund association under section 354B.21, subdivision 2; 51.28(5) a teacher employed by a charter school, irrespective of the location of the 51.29school; or 51.30(6) an employee who is a part-time teacher in a technical college in a new text begin the new text end city of the 51.31first class new text begin St. Paul new text end and who has elected coverage by the applicable first class city teacher 51.32retirement fund association under section 354B.21, subdivision 2, but (i) the teaching 51.33service is incidental to the regular nonteaching occupation of the person; (ii) the applicable 51.34technical college stipulates annually in advance that the part-time teaching service will not 52.1exceed 300 hours in a fiscal year; and (iii) the part-time teaching actually does not exceed 52.2300 hours in the fiscal year to which the certification applies. 52.3    Sec. 14. Minnesota Statutes 2012, section 354A.021, subdivision 1, is amended to read: 52.4    Subdivision 1. Establishment. There is established a teachers retirement fund 52.5association in each of the cities new text begin city new text end of Duluth and St. Paul. The associations shall be 52.6 new text begin association is new text end known respectively as the "Duluth Teachers Retirement Fund Association" 52.7and the "St. Paul Teachers Retirement Fund Association." Each new text begin The new text end association shall be 52.8 new text begin is new text end a continuation of the teachers retirement fund association with the same corporate 52.9name established pursuant to new text begin under new text end the authorization contained in Laws 1909, chapter 52.10343, section 1. 52.11    Sec. 15. new text begin [354A.022] AUTHORIZATION TO CERTIFY FUNDS TO STATE new text end 52.12 new text begin BOARD OF INVESTMENT. new text end 52.13     new text begin Subdivision 1. new text end new text begin Certification of funds to State Board of Investment. new text end new text begin The chief new text end 52.14 new text begin administrative officer of the Duluth Teachers Retirement Fund Association, from time new text end 52.15 new text begin to time, may certify to the State Board of Investment those portions of the assets of the new text end 52.16 new text begin retirement plan that are not needed for administrative expenses or benefit payments. new text end 52.17 new text begin Assets certified to the State Board of Investment must be invested under sections 11A.14 new text end 52.18 new text begin and 11A.23. The chief administrative officer of the Duluth Teachers Retirement Fund new text end 52.19 new text begin Association may certify assets for withdrawal from the State Board of Investment only new text end 52.20 new text begin to make benefit payments or to pay administrative expenses or investment expenses of new text end 52.21 new text begin existing direct real estate holdings or assets that are noncompliant with State Board of new text end 52.22 new text begin Investment objectives or limitations. new text end 52.23     new text begin Subd. 2. new text end new text begin Investment of certified funds. new text end new text begin Assets certified to the State Board of new text end 52.24 new text begin Investment are deemed to be from a covered retirement fund required to be invested by new text end 52.25 new text begin the State Board of Investment under section 11A.23. new text end 52.26     new text begin Subd. 3. new text end new text begin Expiration. new text end new text begin This section expires June 30, 2015, if the consolidation new text end 52.27 new text begin provisions receive the local approvals in section 49 and all other requirements of section new text end 52.28 new text begin 49 are met. new text end 52.29    Sec. 16. Minnesota Statutes 2012, section 354A.092, is amended to read: 52.30354A.092 SABBATICAL LEAVE. 52.31Any teacher in the coordinated program of the St. Paul Teachers Retirement Fund 52.32Association or any teacher in the new law coordinated program of the Duluth Teachers 52.33Retirement Fund Association who is granted a sabbatical leave shall be new text begin is new text end entitled to 53.1receive allowable service credit in the applicable association for periods of sabbatical 53.2leave. To obtain the service credit, the teacher on sabbatical leave shall make an employee 53.3contribution to the applicable association. No teacher shall be new text begin is new text end entitled to receive more 53.4than three years of allowable service credit pursuant to new text begin under new text end this section for a period or 53.5periods of sabbatical leave during any ten consecutive fiscal or calendar years, whichever is 53.6the applicable plan year for the teachers retirement fund association. If the teacher granted a 53.7sabbatical leave makes the employee contribution for a period of sabbatical leave pursuant 53.8to new text begin under new text end this section, the employing unit shall make an employer contribution on behalf of 53.9the teacher to the applicable association for that period of sabbatical leave in the manner 53.10described in section 354A.12, subdivision 2a. The employee and employer contributions 53.11shall new text begin must new text end be in an amount equal to the employee and employer contribution rates in effect 53.12for other active members of the association covered by the same program applied to a salary 53.13figure equal to the teacher's actual covered salary for the plan year immediately preceding 53.14the sabbatical leave period. Payment of the employee contribution authorized pursuant 53.15to new text begin under new text end this section shall new text begin must new text end be made by the teacher on or before June 30 of year 53.16next following the year in which the sabbatical leave terminated and shall new text begin must new text end be made 53.17without interest. For sabbatical leaves taken after June 30, 1986, the required employer 53.18contributions shall new text begin must new text end be paid by the employing unit within 30 days after notification by 53.19the association of the amount due. If the employee contributions for the sabbatical leave 53.20period are less than an amount equal to the applicable contribution rate applied to a salary 53.21figure equal to the teacher's actual covered salary for the plan year immediately preceding 53.22the sabbatical leave period, service credit shall new text begin must new text end be prorated. The prorated service 53.23credit shall new text begin must new text end be determined by the ratio between the amount of the actual payment 53.24which was made and the full contribution amount payable pursuant to new text begin under new text end this section. 53.25    Sec. 17. Minnesota Statutes 2012, section 354A.093, subdivision 1, is amended to read: 53.26    Subdivision 1. Eligibility. Any teacher in the coordinated program of the St. Paul 53.27Teachers Retirement Fund Association or any teacher in the new law coordinated program 53.28of the Duluth Teachers Retirement Fund Association who is absent from employment by 53.29reason of service in the uniformed services as defined in United States Code, title 38, 53.30section 4303(13) and who returns to the employer providing active teaching service upon 53.31discharge from uniformed service within the time frames required under United States 53.32Code, title 38, section 4312(e), may receive allowable service credit in the applicable 53.33 association for all or a portion of the period of uniformed service, provided that the teacher 53.34did not separate from uniformed service with a dishonorable or bad conduct discharge 53.35or under other than honorable conditions. 54.1    Sec. 18. Minnesota Statutes 2012, section 354A.096, is amended to read: 54.2354A.096 MEDICAL LEAVE. 54.3Any teacher in the coordinated program of the St. Paul Teachers Retirement Fund 54.4Association or the new law coordinated program of the Duluth Teachers Retirement Fund 54.5Association who is on an authorized medical leave of absence and subsequently returns to 54.6teaching service is entitled to receive allowable service credit, not to exceed one year, for 54.7the period of leave, upon making the prescribed payment to the fund. This payment must 54.8include the required employee and employer contributions at the rates specified in section 54.9354A.12 , subdivisions 1 and 2a, as applied to the member's average full-time monthly 54.10salary rate on the date the leave of absence commenced plus annual interest at the rate of 54.118.5 percent per year from the end of the fiscal year during which the leave terminates to the 54.12end of the month during which payment is made. The member must pay the total amount 54.13required unless the employing unit, at its option, pays the employer contributions. The total 54.14amount required must be paid by the end of the fiscal year following the fiscal year in which 54.15the leave of absence terminated or before the member retires, whichever is earlier. Payment 54.16must be accompanied by a copy of the resolution or action of the employing authority 54.17granting the leave and the employing authority, upon granting the leave, must certify the 54.18leave to the association in a manner specified by the executive director. A member may not 54.19receive more than one year of allowable service credit during any fiscal year by making 54.20payment under this section. A member may not receive disability benefits under section 54.21354A.36 and receive allowable service credit under this section for the same period of time. 54.22    Sec. 19. Minnesota Statutes 2013 Supplement, section 354A.12, subdivision 1, is 54.23amended to read: 54.24    Subdivision 1. Employee contributions. (a) The contribution required to be paid 54.25by each member of a new text begin the St. Paul new text end Teachers Retirement Fund Association is the percentage 54.26of total salary specified below for the applicable association and program: 54.27 Association and Program Percentage of Total Salary 54.28 Duluth Teachers Retirement Fund Association 54.29 old law and new law 54.30 coordinated programs 54.31 before July 1, 2013 6.5 percent 54.32 effective July 1, 2013 7.0 percent 54.33 effective July 1, 2014 7.5 percent 54.34 St. Paul Teachers Retirement Fund Association 54.35 basic program after June 30, 2012 8.5 percent 54.36 basic program after June 30, 2013 8.75 percent 55.1 basic program after June 30, 2014 9.0 percent 55.2 basic program after June 30, 2015 9.5 percent 55.3 basic program after June 30, 2016 10.0 percent 55.4 coordinated program after June 30, 2012 6.0 percent 55.5 coordinated program after June 30, 2013 6.25 percent 55.6 coordinated program after June 30, 2014 6.5 percent 55.7 coordinated program after June 30, 2015 7.0 percent 55.8 coordinated program after June 30, 2016 7.5 percent 55.9(b) Contributions shall new text begin must new text end be made by deduction from salary and must be remitted 55.10directly to the respective new text begin St. Paul new text end Teachers Retirement Fund Association at least once 55.11each month. 55.12(c) When an employee contribution rate changes for a fiscal year, the new 55.13contribution rate is effective for the entire salary paid by the employer with the first 55.14payroll cycle reported. 55.15    Sec. 20. Minnesota Statutes 2012, section 354A.12, subdivision 2, is amended to read: 55.16    Subd. 2. Retirement contribution levy disallowed. Except as provided in 55.17section 423A.02, subdivision 3, with respect to Independent School District No. 625, 55.18notwithstanding any law to the contrary, levies for new text begin the St. Paul new text end Teachers Retirement Fund 55.19associations in the cities of Duluth and St. Paul new text begin Association new text end , including levies for any 55.20employer Social Security taxes for teachers covered by the Duluth Teachers Retirement 55.21Fund Association or the St. Paul Teachers Retirement Fund Association, are disallowed. 55.22    Sec. 21. Minnesota Statutes 2013 Supplement, section 354A.12, subdivision 2a, 55.23is amended to read: 55.24    Subd. 2a. Employer regular and additional contributions. (a) The employing 55.25units shall make the following employer contributions to new text begin the new text end teachers retirement fund 55.26associations new text begin association new text end : 55.27(1) for any coordinated member of one of the following new text begin St. Paul new text end Teachers 55.28Retirement Fund associations in a city of the first class new text begin Association new text end , the employing unit 55.29shall make a regular employer contribution to the respective retirement fund association in 55.30an amount equal to the designated percentage of the salary of the coordinated member 55.31as provided below: 55.32 Duluth Teachers Retirement Fund Association 55.33 before July 1, 2013 6.79 percent 55.34 effective July 1, 2013 7.29 percent 55.35 effective July 1, 2014 7.50 percent 56.1 St. Paul Teachers Retirement Fund Association 56.2 after June 30, 2012 5.0 percent 56.3 after June 30, 2013 5.25 percent 56.4 after June 30, 2014 5.5 percent 56.5 after June 30, 2015 6.0 percent 56.6 after June 30, 2016 6.25 percent 56.7 after June 30, 2017 6.5 percent 56.8(2) for any basic member of the St. Paul Teachers Retirement Fund Association, the 56.9employing unit shall make a regular employer contribution to the respective retirement 56.10fund in an amount according to the schedule below: 56.11 after June 30, 2012 8.5 percent of salary 56.12 after June 30, 2013 8.75 percent of salary 56.13 after June 30, 2014 9.0 percent of salary 56.14 after June 30, 2015 9.5 percent of salary 56.15 after June 30, 2016 9.75 percent of salary 56.16 after June 30, 2017 10.0 percent of salary 56.17(3) for a basic member of the St. Paul Teachers Retirement Fund Association, the 56.18employing unit shall make an additional employer contribution to the respective fund in 56.19an amount equal to 3.64 percent of the salary of the basic member; 56.20(4) for a coordinated member of the St. Paul Teachers Retirement Fund Association, 56.21the employing unit shall make an additional employer contribution to the respective fund 56.22in an amount equal to the applicable percentage new text begin 3.84 percent new text end of the coordinated member's 56.23salary, as provided below: new text begin . new text end 56.24 St. Paul Teachers Retirement Fund Association 3.84 percent 56.25(b) The regular and additional employer contributions must be remitted directly to 56.26the respective new text begin St. Paul new text end Teachers Retirement Fund Association at least once each month. 56.27Delinquent amounts are payable with interest under the procedure in subdivision 1a. 56.28(c) Payments of regular and additional employer contributions for school district 56.29or technical college employees who are paid from normal operating funds must be made 56.30from the appropriate fund of the district or technical college. 56.31(d) When an employer contribution rate changes for a fiscal year, the new 56.32contribution rate is effective for the entire salary paid by the employer with the first 56.33payroll cycle reported. 56.34    Sec. 22. Minnesota Statutes 2013 Supplement, section 354A.12, subdivision 3a, 56.35is amended to read: 57.1    Subd. 3a. Special direct state aid to first class city teachers retirement fund 57.2associations. (a) The state shall pay $346,000 as special direct state aid to the Duluth 57.3Teachers Retirement Fund Association and $2,827,000 to the St. Paul Teachers Retirement 57.4Fund Association. 57.5    (b) The aids new text begin aid new text end under this subdivision are new text begin is new text end payable October 1 annually. The 57.6commissioner of management and budget shall pay the aids new text begin aid new text end specified in this 57.7subdivision. The amounts new text begin amount new text end required are new text begin is new text end appropriated annually from the general 57.8fund to the commissioner of management and budget. 57.9    Sec. 23. Minnesota Statutes 2012, section 354A.31, subdivision 1, is amended to read: 57.10    Subdivision 1. Age and service requirements. Any coordinated member or former 57.11coordinated member of the Duluth Teachers Retirement Fund Association or of the St. 57.12Paul Teachers Retirement Fund Association who has ceased to render teaching service for 57.13the new text begin Independent new text end School District in which the teachers retirement fund association exists 57.14 new text begin No. 625 new text end , who is vested and who has either attained the age of at least 55 years or received 57.15credit for not less than 30 years of allowable service regardless of age, shall be new text begin is new text end entitled 57.16upon written application to a retirement annuity. 57.17    Sec. 24. Minnesota Statutes 2012, section 354A.32, subdivision 1, is amended to read: 57.18    Subdivision 1. Optional forms generally. The board of the St. Paul Teachers 57.19Retirement Fund Association shall establish for the coordinated program and the board 57.20of the Duluth Teachers Retirement Fund Association shall establish for the new law 57.21coordinated program an optional retirement annuity which shall new text begin must new text end take the form of 57.22a joint and survivor annuity. Each new text begin The new text end board may also new text begin , new text end in its discretion new text begin , new text end establish an 57.23optional annuity which shall new text begin may new text end take the form of an annuity payable for a period certain 57.24and for life thereafter. Each new text begin The new text end board shall also establish an optional retirement annuity 57.25that guarantees payment of the balance of the annuity recipient's accumulated deductions 57.26to a designated beneficiary upon the death of the annuity recipient. Except as provided in 57.27subdivision 1a, new text begin the new text end optional annuity forms shall new text begin must new text end be the actuarial equivalent of the 57.28normal forms provided in section 354A.31. In establishing these optional annuity forms, 57.29the board shall obtain the written recommendation of the actuary retained under section 57.30356.214 . The recommendation shall new text begin must new text end be a part of the permanent records of the board. 57.31    Sec. 25. Minnesota Statutes 2012, section 354A.35, subdivision 1, is amended to read: 57.32    Subdivision 1. Death before retirement; refund. If a coordinated member or 57.33former coordinated member dies prior to new text begin before new text end retirement or prior to new text begin before new text end the receipt 58.1of any retirement annuity or other benefit payment which is or may be payable and a 58.2surviving spouse optional annuity is not payable pursuant to new text begin under new text end subdivision 2, a 58.3refund shall new text begin must new text end be paid to the person's surviving spouse, or if there is none, to the 58.4person's designated beneficiary, or if there is none, to the legal representative of the 58.5person's estate. For a coordinated member or former coordinated member of the St. Paul 58.6Teachers Retirement Fund Association, the refund shall new text begin must new text end be in an amount equal to the 58.7person's accumulated employee contributions plus interest at the rate of six percent per 58.8annum compounded annually. For a coordinated member or former coordinated member 58.9of the Duluth Teachers Retirement Fund Association, the refund shall be in an amount 58.10equal to the person's accumulated employee contributions plus interest at the rate of six 58.11percent per annum compounded annually to July 1, 2010, and four percent per annum 58.12compounded annually thereafter. 58.13    Sec. 26. Minnesota Statutes 2012, section 354A.37, subdivision 3, is amended to read: 58.14    Subd. 3. Computation of refund amount. A former coordinated member who 58.15qualifies for a refund under subdivision 1 shall new text begin is entitled to new text end receive a refund equal to the 58.16amount of the former coordinated member's accumulated employee contributions with 58.17interest at the rate of six percent per annum compounded annually to July 1, 2010, if the 58.18person is a former member of the Duluth Teachers Retirement Fund Association, or to 58.19 July 1, 2011, if the person is a former member of the St. Paul Teachers Retirement Fund 58.20Association, and four percent per annum compounded annually thereafter. 58.21    Sec. 27. Minnesota Statutes 2012, section 354A.37, subdivision 4, is amended to read: 58.22    Subd. 4. Certain refunds at normal retirement age. Any coordinated member 58.23who has attained the normal retirement age with less than ten years of allowable service 58.24credit and has terminated active teaching service shall be new text begin is new text end entitled to a refund in lieu of a 58.25proportionate annuity under section 356.32. The refund must be equal to the coordinated 58.26member's accumulated employee contributions plus interest at the rate of six percent 58.27compounded annually to July 1, 2010, if the person is a former member of the Duluth 58.28Teachers Retirement Fund Association, or to July 1, 2011, if the person is a former 58.29member of the St. Paul Teachers Retirement Fund Association, and four percent per 58.30annum compounded annually thereafter. 58.31    Sec. 28. Minnesota Statutes 2012, section 354A.39, is amended to read: 58.32354A.39 SERVICE IN OTHER PUBLIC RETIREMENT FUNDS; ANNUITY. 59.1Any person who has been a member of the Minnesota State Retirement System, the 59.2Public Employees Retirement Association including the Public Employees Retirement 59.3Association Police and Fire Fund, the Teachers Retirement Association, the Minnesota 59.4State Patrol Retirement Association, the legislators retirement plan, the constitutional 59.5officers retirement plan, the Duluth Teachers Retirement Fund Association new law 59.6coordinated program, the St. Paul Teachers Retirement Fund Association coordinated 59.7program, or any other public employee retirement system in the state of Minnesota 59.8having a like provision, but excluding all other funds providing retirement benefits for 59.9police officers or firefighters, is entitled, when qualified, to an annuity from each fund if 59.10the person's total allowable service in all of the funds or in any two or more of the funds 59.11totals three or more years, provided that no portion of the allowable service upon which 59.12the retirement annuity from one fund is based is used again in the computation for a 59.13retirement annuity from another fund and provided further that the person has not taken a 59.14refund from any of funds or associations since the person's membership in the fund or 59.15association has terminated. The annuity from each fund or association must be determined 59.16by the appropriate provisions of the law governing each fund or association, except that 59.17the requirement that a person must have at least three years of allowable service in the 59.18respective fund or association does not apply for the purposes of this section, provided 59.19that the aggregate service in two or more of these funds equals three or more years. 59.20    Sec. 29. Minnesota Statutes 2012, section 354A.41, is amended to read: 59.21354A.41 ADMINISTRATION OF COORDINATED PROGRAM. 59.22    Subdivision 1. Administrative provisions. The provisions of the articles of 59.23incorporation and bylaws of the St. Paul Teachers Retirement Fund Association relating 59.24to the administration of the fund shall govern the administration of the coordinated and 59.25basic programs and the provisions of the articles of incorporation and bylaws of the 59.26Duluth Teachers Retirement Fund Association relating to the administration of the fund 59.27shall govern the administration of the new law coordinated program in instances where the 59.28administrative provisions are not inconsistent with the provisions of sections 354A.31 to 59.29354A.41 , including but not limited to provisions relating to the composition and function 59.30of the board of trustees, the investment of assets of the new text begin St. Paul new text end Teachers Retirement Fund 59.31Association, and the definition of the plan year. The administrative provisions in the 59.32articles of incorporation and the bylaws of the Minneapolis Teachers Retirement Fund 59.33Association pertaining to the granting of pension benefits of the basic and coordinated 59.34programs are no longer in effect after June 30, 2006 new text begin , and the administrative provisions of new text end 60.1 new text begin the Duluth Teachers Retirement Fund Association pertaining to retirement benefits of the new text end 60.2 new text begin old law coordinated program are no longer in effect after June 30, 2015 new text end . 60.3    Subd. 2. Actuarial valuations. In any actuarial valuation of the St. Paul Teachers 60.4Retirement Fund Association, or the Duluth Teachers Retirement Fund Association under 60.5section 356.215 prepared by the actuary retained under section 356.214 or supplemental 60.6actuarial valuation prepared by an approved actuary retained by the new text begin St. Paul new text end Teachers 60.7Retirement Fund Association, there shall new text begin must new text end be included a finding of the condition of the 60.8fund showing separately the basic and coordinated programs or the old law coordinated 60.9and new law coordinated programs, as appropriate. The finding shall new text begin must new text end include the level 60.10normal cost and the applicable employee and employer contribution rates for each program. 60.11    Sec. 30. Minnesota Statutes 2012, section 354B.21, subdivision 3a, is amended to read: 60.12    Subd. 3a. Plan coverage and election; certain past service technical college 60.13faculty. (a) Notwithstanding subdivision 3, if an employee of the board was employed in 60.14a faculty position in a technical college on June 30, 1997, with coverage by the Teachers 60.15Retirement Association, the employee retains that coverage. If the employee was a 60.16technical college faculty member on June 30, 1995, covered by a first class city teacher 60.17retirement fund established under chapter 354A, the retirement coverage continues with 60.18the Duluth Teachers Retirement Fund Association or the St. Paul Teachers Retirement 60.19Fund Association, whichever is applicable. If the person was a technical college faculty 60.20member on June 30, 1995, covered by the former Minneapolis Teachers Retirement Fund 60.21Association new text begin or the former Duluth Teachers Retirement Fund Association new text end , the Teachers 60.22Retirement Association shall provide coverage. 60.23(b) An employee under paragraph (a) who has coverage by a first class city 60.24teacher new text begin the St. Paul Teachers Retirement new text end Fund Association retains that coverage for the 60.25duration of the person's employment by the board unless, within one year of a change in 60.26employment within the Minnesota State Colleges and Universities system, the person 60.27elects the individual retirement account plan for all future employment by the board. 60.28The election is irrevocable. 60.29    Sec. 31. Minnesota Statutes 2012, section 355.01, subdivision 2c, is amended to read: 60.30    Subd. 2c. Duluth teacher. "Duluth teacher" means a person employed by 60.31Independent School District No. 709, Duluth, who holds a position covered by the Duluth 60.32 Teachers Retirement Fund Association established under chapter 354A new text begin section 354.73 new text end 60.33 new text begin and section 46 new text end . 61.1    Sec. 32. Minnesota Statutes 2013 Supplement, section 356.20, subdivision 2, is 61.2amended to read: 61.3    Subd. 2. Covered public pension plans and funds. This section applies to the 61.4following public pension plans: 61.5    (1) the general state employees retirement plan of the Minnesota State Retirement 61.6System; 61.7    (2) the general employees retirement plan of the Public Employees Retirement 61.8Association; 61.9    (3) the Teachers Retirement Association; 61.10    (4) the State Patrol retirement plan; 61.11    (5) the St. Paul Teachers Retirement Fund Association; 61.12    (6) the Duluth Teachers Retirement Fund Association; 61.13    (7) new text begin (6) new text end the University of Minnesota faculty retirement plan; 61.14    (8) new text begin (7) new text end the University of Minnesota faculty supplemental retirement plan; 61.15    (9) new text begin (8) new text end the judges retirement fund; 61.16    (10) new text begin (9) new text end the Bloomington Fire Department Relief Association; 61.17    (11) new text begin (10) new text end a volunteer firefighter relief association governed by section 424A.091; 61.18    (12) new text begin (11) new text end the public employees police and fire plan of the Public Employees 61.19Retirement Association; 61.20    (13) new text begin (12) new text end the correctional state employees retirement plan of the Minnesota State 61.21Retirement System; 61.22    (14) new text begin (13) new text end the local government correctional service retirement plan of the Public 61.23Employees Retirement Association; and 61.24(15) new text begin (14) new text end the voluntary statewide lump-sum volunteer firefighter retirement plan. 61.25    Sec. 33. Minnesota Statutes 2013 Supplement, section 356.214, subdivision 1, is 61.26amended to read: 61.27    Subdivision 1. Actuary retention. (a) The governing board or managing or 61.28administrative official of each public pension plan and retirement fund or plan enumerated 61.29in paragraph (b) shall contract with an established actuarial consulting firm to conduct 61.30annual actuarial valuations and related services. The principal from the actuarial 61.31consulting firm on the contract must be an approved actuary under section 356.215, 61.32subdivision 1 , paragraph (c). 61.33    (b) Actuarial services must include the preparation of actuarial valuations and 61.34related actuarial work for the following retirement plans: 61.35    (1) the teachers retirement plan, Teachers Retirement Association; 62.1    (2) the general state employees retirement plan, Minnesota State Retirement System; 62.2    (3) the correctional employees retirement plan, Minnesota State Retirement System; 62.3    (4) the State Patrol retirement plan, Minnesota State Retirement System; 62.4    (5) the judges retirement plan, Minnesota State Retirement System; 62.5    (6) the general employees retirement plan, Public Employees Retirement 62.6Association, including the MERF division; 62.7    (7) the public employees police and fire plan, Public Employees Retirement 62.8Association; 62.9    (8) the Duluth teachers retirement plan, Duluth Teachers Retirement Fund 62.10Association; 62.11    (9) new text begin (8) new text end the St. Paul teachers retirement plan, St. Paul Teachers Retirement Fund 62.12Association; 62.13    (10) new text begin (9) new text end the legislators retirement plan, Minnesota State Retirement System; and 62.14    (11) new text begin (10) new text end the local government correctional service retirement plan, Public 62.15Employees Retirement Association. 62.16(c) The actuarial valuation for the legislators retirement plan must include a separate 62.17calculation of total plan actuarial accrued liabilities due to constitutional officer coverage 62.18under section 3A.17. 62.19    (d) The contracts must require completion of the annual actuarial valuation 62.20calculations on a fiscal year basis, with the contents of the actuarial valuation calculations 62.21as specified in section 356.215, and in conformity with the standards for actuarial work 62.22adopted by the Legislative Commission on Pensions and Retirement. 62.23    The contracts must require completion of annual experience data collection and 62.24processing and a quadrennial published experience study for the plans listed in paragraph 62.25(b), clauses (1), (2), and (6), as provided for in the standards for actuarial work adopted by 62.26the commission. The experience data collection, processing, and analysis must evaluate 62.27the following: 62.28    (1) individual salary progression; 62.29    (2) the rate of return on investments based on the current asset value; 62.30    (3) payroll growth; 62.31    (4) mortality; 62.32    (5) retirement age; 62.33    (6) withdrawal; and 62.34    (7) disablement. 62.35    (e) The actuary shall annually prepare a report to the governing or managing board 62.36or administrative official and the legislature, summarizing the results of the actuarial 63.1valuation calculations. The actuary shall include with the report any recommendations 63.2concerning the appropriateness of the support rates to achieve proper funding of 63.3the retirement plans by the required funding dates. The actuary shall, as part of the 63.4quadrennial experience study, include recommendations on the appropriateness of the 63.5actuarial valuation assumptions required for evaluation in the study. 63.6    (f) If the actuarial gain and loss analysis in the actuarial valuation calculations 63.7indicates a persistent pattern of sizable gains or losses, the governing or managing board 63.8or administrative official shall direct the actuary to prepare a special experience study for a 63.9plan listed in paragraph (b), clause (3), (4), (5), (7), (8), (9), new text begin or new text end (10), or (11), in the manner 63.10provided for in the standards for actuarial work adopted by the commission. 63.11    Sec. 34. Minnesota Statutes 2013 Supplement, section 356.215, subdivision 8, is 63.12amended to read: 63.13    Subd. 8. Interest and salary assumptions. (a) The actuarial valuation must use 63.14the applicable following preretirement interest assumption and the applicable following 63.15postretirement interest assumption: 63.16(1) select and ultimate interest rate assumption 63.17 63.18 63.19 63.20 plan ultimate preretirement interest rate assumption ultimate postretirement interest rate assumption 63.21 general state employees retirement plan 8.5% 6.0% 63.22 correctional state employees retirement plan 8.5 6.0 63.23 State Patrol retirement plan 8.5 6.0 63.24 63.25 63.26 legislators retirement plan, and for the constitutional officers calculation of total plan liabilities 0.0 0.0 63.27 judges retirement plan 8.5 6.0 63.28 general public employees retirement plan 8.5 6.0 63.29 public employees police and fire retirement plan 8.5 6.0 63.30 63.31 local government correctional service retirement plan 8.5 6.0 63.32 teachers retirement plan 8.5 6.0 63.33 Duluth teachers retirement plan 8.5 8.5 63.34 St. Paul teachers retirement plan 8.5 8.5 63.35Except for the legislators retirement plan and the constitutional officers calculation 63.36of total plan liabilities, the select preretirement interest rate assumption for the period 63.37after June 30, 2012, through June 30, 2017, is 8.0 percent. Except for the legislators 63.38retirement plan and the constitutional officers calculation of total plan liabilities, the select 63.39postretirement interest rate assumption for the period after June 30, 2012, through June 64.130, 2017, is 5.5 percent, except for the Duluth teachers retirement plan and the St. Paul 64.2teachers retirement plan, each with a select postretirement interest rate assumption for the 64.3period after June 30, 2012, through June 30, 2017, of 8.0 percent. 64.4(2) single rate preretirement and postretirement interest rate assumption 64.5 64.6 plan interest rate assumption 64.7 Bloomington Fire Department Relief Association 6.0 64.8 64.9 local monthly benefit volunteer firefighters relief associations 5.0 64.10    (b) The actuarial valuation must use the applicable following single rate future salary 64.11increase assumption, the applicable following modified single rate future salary increase 64.12assumption, or the applicable following graded rate future salary increase assumption: 64.13    (1) single rate future salary increase assumption 64.14 plan future salary increase assumption 64.15 legislators retirement plan 5.0% 64.16 judges retirement plan 3.0 64.17 64.18 Bloomington Fire Department Relief Association 4.0 64.19    (2) age-related future salary increase age-related select and ultimate future salary 64.20increase assumption or graded rate future salary increase assumption 64.21 plan future salary increase assumption 64.22 local government correctional service retirement plan assumption C new text begin B new text end 64.23 Duluth teachers retirement plan assumption A 64.24 St. Paul teachers retirement plan assumption B new text begin A new text end 64.25For plans other than the Duluth new text begin St. Paul new text end 64.26teachers retirement plan new text begin and the local new text end 64.27 new text begin government correctional service retirement new text end 64.28 new text begin plan new text end , the select calculation is: during the 64.29designated select period, a designated 64.30percentage rate is multiplied by the result of 64.31the designated integer minus T, where T is the 64.32number of completed years of service, and is 64.33added to the applicable future salary increase 64.34assumption. The designated select period is 64.35ten years and the designated integer is ten 64.36for the Duluth Teachers Retirement Fund 64.37Association and for the local government 64.38correctional service retirement plan and 15 65.1for the St. Paul Teachers Retirement Fund 65.2Association. The designated percentage 65.3rate is 0.2 percent for the St. Paul Teachers 65.4Retirement Fund Association. The select 65.5calculation for the Duluth Teachers 65.6Retirement Fund Association is 8.00 percent 65.7per year for service years one through seven, 65.87.25 percent per year for service years seven 65.9and eight, and 6.50 percent per year for 65.10service years eight and nine. 65.11    The ultimate future salary increase assumption is: 65.12 age A B new text begin A new text end C new text begin B new text end 65.13 16 6.00% 5.90% 9.00% 65.14 17 6.00 5.90 9.00 65.15 18 6.00 5.90 9.00 65.16 19 6.00 5.90 9.00 65.17 20 6.00 5.90 9.00 65.18 21 6.00 5.90 8.75 65.19 22 6.00 5.90 8.50 65.20 23 6.00 5.85 8.25 65.21 24 6.00 5.80 8.00 65.22 25 6.00 5.75 7.75 65.23 26 6.00 5.70 7.50 65.24 27 6.00 5.65 7.25 65.25 28 6.00 5.60 7.00 65.26 29 6.00 5.55 6.75 65.27 30 6.00 5.50 6.75 65.28 31 6.00 5.45 6.50 65.29 32 6.00 5.40 6.50 65.30 33 6.00 5.35 6.50 65.31 34 6.00 5.30 6.25 65.32 35 6.00 5.25 6.25 65.33 36 5.86 5.20 6.00 65.34 37 5.73 5.15 6.00 65.35 38 5.59 5.10 6.00 65.36 39 5.45 5.05 5.75 65.37 40 5.31 5.00 5.75 65.38 41 5.18 4.95 5.75 65.39 42 5.04 4.90 5.50 65.40 43 4.90 4.85 5.25 65.41 44 4.76 4.80 5.25 66.1 45 4.63 4.75 5.00 66.2 46 4.49 4.70 5.00 66.3 47 4.35 4.65 5.00 66.4 48 4.21 4.60 5.00 66.5 49 4.08 4.55 5.00 66.6 50 3.94 4.50 5.00 66.7 51 3.80 4.45 5.00 66.8 52 3.66 4.40 5.00 66.9 53 3.53 4.35 5.00 66.10 54 3.39 4.30 5.00 66.11 55 3.25 4.25 4.75 66.12 56 3.25 4.20 4.75 66.13 57 3.25 4.15 4.50 66.14 58 3.25 4.10 4.25 66.15 59 3.25 4.05 4.25 66.16 60 3.25 4.00 4.25 66.17 61 3.25 4.00 4.25 66.18 62 3.25 4.00 4.25 66.19 63 3.25 4.00 4.25 66.20 64 3.25 4.00 4.25 66.21 65 3.25 4.00 4.00 66.22 66 3.25 4.00 4.00 66.23 67 3.25 4.00 4.00 66.24 68 3.25 4.00 4.00 66.25 69 3.25 4.00 4.00 66.26 70 3.25 4.00 4.00 66.27(3) service-related ultimate future salary increase assumption 66.28 66.29 general state employees retirement plan of the Minnesota State Retirement System assumption A 66.30 66.31 general employees retirement plan of the Public Employees Retirement Association assumption B 66.32 Teachers Retirement Association assumption C 66.33 public employees police and fire retirement plan assumption D 66.34 State Patrol retirement plan assumption E 66.35 66.36 correctional state employees retirement plan of the Minnesota State Retirement System assumption F 66.37 66.38 service length A B C D E F 66.39 1 10.50% 12.03% 12.00% 13.00% 8.00% 6.00% 66.40 2 8.10 8.90 9.00 11.00 7.50 5.85 66.41 3 6.90 7.46 8.00 9.00 7.00 5.70 66.42 4 6.20 6.58 7.50 8.00 6.75 5.55 66.43 5 5.70 5.97 7.25 6.50 6.50 5.40 67.1 6 5.30 5.52 7.00 6.10 6.25 5.25 67.2 7 5.00 5.16 6.85 5.80 6.00 5.10 67.3 8 4.70 4.87 6.70 5.60 5.85 4.95 67.4 9 4.50 4.63 6.55 5.40 5.70 4.80 67.5 10 4.40 4.42 6.40 5.30 5.55 4.65 67.6 11 4.20 4.24 6.25 5.20 5.40 4.55 67.7 12 4.10 4.08 6.00 5.10 5.25 4.45 67.8 13 4.00 3.94 5.75 5.00 5.10 4.35 67.9 14 3.80 3.82 5.50 4.90 4.95 4.25 67.10 15 3.70 3.70 5.25 4.80 4.80 4.15 67.11 16 3.60 3.60 5.00 4.80 4.65 4.05 67.12 17 3.50 3.51 4.75 4.80 4.50 3.95 67.13 18 3.50 3.50 4.50 4.80 4.35 3.85 67.14 19 3.50 3.50 4.25 4.80 4.20 3.75 67.15 20 3.50 3.50 4.00 4.80 4.05 3.75 67.16 21 3.50 3.50 3.90 4.70 4.00 3.75 67.17 22 3.50 3.50 3.80 4.60 4.00 3.75 67.18 23 3.50 3.50 3.70 4.50 4.00 3.75 67.19 24 3.50 3.50 3.60 4.50 4.00 3.75 67.20 25 3.50 3.50 3.50 4.50 4.00 3.75 67.21 26 3.50 3.50 3.50 4.50 4.00 3.75 67.22 27 3.50 3.50 3.50 4.50 4.00 3.75 67.23 28 3.50 3.50 3.50 4.50 4.00 3.75 67.24 29 3.50 3.50 3.50 4.50 4.00 3.75 67.25 30 or more 3.50 3.50 3.50 4.50 4.00 3.75 67.26    (c) The actuarial valuation must use the applicable following payroll growth 67.27assumption for calculating the amortization requirement for the unfunded actuarial 67.28accrued liability where the amortization retirement is calculated as a level percentage 67.29of an increasing payroll: 67.30 plan payroll growth assumption 67.31 67.32 general state employees retirement plan of the Minnesota State Retirement System 3.75% 67.33 correctional state employees retirement plan 3.75 67.34 State Patrol retirement plan 3.75 67.35 judges retirement plan 3.00 67.36 67.37 general employees retirement plan of the Public Employees Retirement Association 3.75 67.38 public employees police and fire retirement plan 3.75 67.39 local government correctional service retirement plan 3.75 67.40 teachers retirement plan 3.75 67.41 Duluth teachers retirement plan 3.50 67.42 St. Paul teachers retirement plan 4.00 68.1    (d) The assumptions set forth in paragraphs (b) and (c) continue to apply, unless a 68.2different salary assumption or a different payroll increase assumption: 68.3    (1) has been proposed by the governing board of the applicable retirement plan; 68.4    (2) is accompanied by the concurring recommendation of the actuary retained under 68.5section 356.214, subdivision 1, if applicable, or by the approved actuary preparing the 68.6most recent actuarial valuation report if section 356.214 does not apply; and 68.7    (3) has been approved or deemed approved under subdivision 18. 68.8    Sec. 35. Minnesota Statutes 2013 Supplement, section 356.219, subdivision 8, is 68.9amended to read: 68.10    Subd. 8. Timing of reports. (a) For the Bloomington Fire Department Relief 68.11Association and the volunteer firefighter relief associations, the information required 68.12under this section must be submitted by the due date for reports required under section 68.1369.051, subdivision 1 or 1a, as applicable. If a relief association satisfies the definition of 68.14a fully invested plan under subdivision 1, paragraph (b), for the calendar year covered 68.15by the report required under section 69.051, subdivision 1 or 1a, as applicable, the chief 68.16administrative officer of the covered pension plan shall certify that compliance on a form 68.17prescribed by the state auditor. The state auditor shall transmit annually to the State Board 68.18of Investment a list or lists of covered pension plans which submitted certifications in 68.19order to facilitate reporting by the State Board of Investment under paragraph (c). 68.20(b) For the St. Paul Teachers Retirement Fund Association, the Duluth Teachers 68.21Retirement Fund Association, and the University of Minnesota faculty supplemental 68.22retirement plan, the information required under this section must be submitted to the state 68.23auditor by June 1 of each year. 68.24(c) The State Board of Investment, on behalf of pension funds specified in 68.25subdivision 1, paragraph (c), must new text begin shall new text end report information required under this section by 68.26September 1 of each year. 68.27    Sec. 36. Minnesota Statutes 2013 Supplement, section 356.30, subdivision 3, is 68.28amended to read: 68.29    Subd. 3. Covered plans. This section applies to the following retirement plans: 68.30(1) the general state employees retirement plan of the Minnesota State Retirement 68.31System, established under chapter 352; 68.32(2) the correctional state employees retirement plan of the Minnesota State 68.33Retirement System, established under chapter 352; 68.34(3) the unclassified employees retirement program, established under chapter 352D; 69.1(4) the State Patrol retirement plan, established under chapter 352B; 69.2(5) the legislators retirement plan, established under chapter 3A, including 69.3constitutional officers as specified in that chapter; 69.4(6) the general employees retirement plan of the Public Employees Retirement 69.5Association, established under chapter 353, including the MERF division of the Public 69.6Employees Retirement Association; 69.7(7) the public employees police and fire retirement plan of the Public Employees 69.8Retirement Association, established under chapter 353; 69.9(8) the local government correctional service retirement plan of the Public 69.10Employees Retirement Association, established under chapter 353E; 69.11(9) the Teachers Retirement Association, established under chapter 354; 69.12(10) the St. Paul Teachers Retirement Fund Association, established under chapter 69.13354A; new text begin and new text end 69.14(11) the Duluth Teachers Retirement Fund Association, established under chapter 69.15354A; and 69.16(12) new text begin (11) new text end the judges retirement fund, established by chapter 490. 69.17    Sec. 37. Minnesota Statutes 2012, section 356.302, subdivision 7, is amended to read: 69.18    Subd. 7. Covered retirement plans. This section applies to the following 69.19retirement plans: 69.20(1) the general state employees retirement plan of the Minnesota State Retirement 69.21System, established by chapter 352; 69.22(2) the unclassified state employees retirement program of the Minnesota State 69.23Retirement System, established by chapter 352D; 69.24(3) the general employees retirement plan of the Public Employees Retirement 69.25Association, established by chapter 353, including the MERF division of the Public 69.26Employees Retirement Association; 69.27(4) the Teachers Retirement Association, established by chapter 354; 69.28(5) the Duluth Teachers Retirement Fund Association, established by chapter 354A; 69.29(6) new text begin (5) new text end the St. Paul Teachers Retirement Fund Association, established by chapter 69.30354A; 69.31(7) new text begin (6) new text end the state correctional employees retirement plan of the Minnesota State 69.32Retirement System, established by chapter 352; 69.33(8) new text begin (7) new text end the State Patrol retirement plan, established by chapter 352B; 69.34(9) new text begin (8) new text end the public employees police and fire plan of the Public Employees Retirement 69.35Association, established by chapter 353; 70.1(10) new text begin (9) new text end the local government correctional service retirement plan of the Public 70.2Employees Retirement Association, established by chapter 353E; and 70.3(11) new text begin (10) new text end the judges retirement plan, established by chapter 490. 70.4    Sec. 38. Minnesota Statutes 2012, section 356.303, subdivision 4, is amended to read: 70.5    Subd. 4. Covered retirement plans. This section applies to the following 70.6retirement plans: 70.7(1) the legislators retirement plan, established by chapter 3A; 70.8(2) the general state employees retirement plan of the Minnesota State Retirement 70.9System, established by chapter 352; 70.10(3) the correctional state employees retirement plan of the Minnesota State 70.11Retirement System, established by chapter 352; 70.12(4) the State Patrol retirement plan, established by chapter 352B; 70.13(5) the elective state officers retirement plan, established by chapter 352C; 70.14(6) the unclassified state employees retirement program, established by chapter 352D; 70.15(7) the general employees retirement plan of the Public Employees Retirement 70.16Association, established by chapter 353, including the MERF division of the Public 70.17Employees Retirement Association; 70.18(8) the public employees police and fire plan of the Public Employees Retirement 70.19Association, established by chapter 353; 70.20(9) the local government correctional service retirement plan of the Public 70.21Employees Retirement Association, established by chapter 353E; 70.22(10) the Teachers Retirement Association, established by chapter 354; 70.23(11) the Duluth Teachers Retirement Fund Association, established by chapter 354A; 70.24(12) new text begin (11) new text end the St. Paul Teachers Retirement Fund Association, established by chapter 70.25354A; and 70.26(13) new text begin (12) new text end the judges retirement fund, established by chapter 490. 70.27    Sec. 39. Minnesota Statutes 2012, section 356.32, subdivision 2, is amended to read: 70.28    Subd. 2. Covered retirement plans. The provisions of this section apply to the 70.29following retirement plans: 70.30(1) the general state employees retirement plan of the Minnesota State Retirement 70.31System, established under chapter 352; 70.32(2) the correctional state employees retirement plan of the Minnesota State 70.33Retirement System, established under chapter 352; 70.34(3) the State Patrol retirement plan, established under chapter 352B; 71.1(4) the general employees retirement plan of the Public Employees Retirement 71.2Association, established under chapter 353, including the MERF division of the Public 71.3Employees Retirement Association; 71.4(5) the public employees police and fire plan of the Public Employees Retirement 71.5Association, established under chapter 353; 71.6(6) the Teachers Retirement Association, established under chapter 354; new text begin and new text end 71.7(7) the Duluth Teachers Retirement Fund Association, established under chapter 71.8354A; and 71.9(8) new text begin (7) new text end the St. Paul Teachers Retirement Fund Association, established under chapter 71.10354A. 71.11    Sec. 40. Minnesota Statutes 2013 Supplement, section 356.401, subdivision 3, is 71.12amended to read: 71.13    Subd. 3. Covered retirement plans. The provisions of this section apply to the 71.14following retirement plans: 71.15(1) the legislators retirement plan, established by chapter 3A, including constitutional 71.16officers as specified in that chapter; 71.17(2) the general state employees retirement plan of the Minnesota State Retirement 71.18System, established by chapter 352; 71.19(3) the correctional state employees retirement plan of the Minnesota State 71.20Retirement System, established by chapter 352; 71.21(4) the State Patrol retirement plan, established by chapter 352B; 71.22(5) the unclassified state employees retirement program, established by chapter 352D; 71.23(6) the general employees retirement plan of the Public Employees Retirement 71.24Association, established by chapter 353, including the MERF division of the Public 71.25Employees Retirement Association; 71.26(7) the public employees police and fire plan of the Public Employees Retirement 71.27Association, established by chapter 353; 71.28(8) the public employees defined contribution plan, established by chapter 353D; 71.29(9) the local government correctional service retirement plan of the Public 71.30Employees Retirement Association, established by chapter 353E; 71.31(10) the voluntary statewide lump-sum volunteer firefighter retirement plan, 71.32established by chapter 353G; 71.33(11) the Teachers Retirement Association, established by chapter 354; 71.34(12) the Duluth Teachers Retirement Fund Association, established by chapter 354A; 72.1(13) new text begin (12) new text end the St. Paul Teachers Retirement Fund Association, established by chapter 72.2354A; 72.3(14) new text begin (13) new text end the individual retirement account plan, established by chapter 354B; 72.4(15) new text begin (14) new text end the higher education supplemental retirement plan, established by chapter 72.5354C; and 72.6(16) new text begin (15) new text end the judges retirement fund, established by chapter 490. 72.7    Sec. 41. Minnesota Statutes 2012, section 356.42, subdivision 3, is amended to read: 72.8    Subd. 3. Covered retirement plans. The postretirement adjustment provided in 72.9this section applies to the following retirement funds: 72.10(1) the general employees retirement plans of the Public Employees Retirement 72.11Association; 72.12(2) the public employees police and fire plan of the Public Employees Retirement 72.13Association; 72.14(3) the teachers retirement association; 72.15(4) the State Patrol retirement plan; 72.16(5) the state employees retirement plan of the Minnesota State Retirement System; 72.17 new text begin and new text end 72.18(6) the St. Paul Teachers Retirement Fund Association established under chapter 72.19354A; and new text begin . new text end 72.20(7) the Duluth Teachers Retirement Fund Association established under chapter 72.21354A. 72.22    Sec. 42. Minnesota Statutes 2012, section 356.465, subdivision 3, is amended to read: 72.23    Subd. 3. Covered retirement plans. The provisions of this section apply to the 72.24following retirement plans: 72.25(1) the general state employees retirement plan of the Minnesota State Retirement 72.26System established under chapter 352; 72.27(2) the correctional state employees retirement plan of the Minnesota State 72.28Retirement System established under chapter 352; 72.29(3) the State Patrol retirement plan established under chapter 352B; 72.30(4) the legislators retirement plan established under chapter 3A; 72.31(5) the judges retirement plan established under chapter 490; 72.32(6) the general employees retirement plan of the Public Employees Retirement 72.33Association established under chapter 353, including the MERF division of the Public 72.34Employees Retirement Association; 73.1(7) the public employees police and fire plan of the Public Employees Retirement 73.2Association established under chapter 353; 73.3(8) the teachers retirement plan established under chapter 354; 73.4(9) the Duluth Teachers Retirement Fund Association established under chapter 73.5354A; 73.6(10) new text begin (9) new text end the St. Paul Teachers Retirement Fund Association established under 73.7chapter 354A; and 73.8(11) new text begin (10) new text end the local government correctional service retirement plan of the Public 73.9Employees Retirement Association established under chapter 353E. 73.10    Sec. 43. Minnesota Statutes 2012, section 356.47, subdivision 3, is amended to read: 73.11    Subd. 3. Payment. (a) Beginning one year after the reemployment withholding 73.12period ends relating to the reemployment that gave rise to the limitation, and the filing of a 73.13written application, the retired member is entitled to the payment, in a lump sum, of the 73.14value of the person's amount under subdivision 2, plus annual compound interest. For the 73.15general state employees retirement plan, the correctional state employees retirement plan, 73.16the general employees retirement plan of the Public Employees Retirement Association, 73.17the public employees police and fire retirement plan, the local government correctional 73.18employees retirement plan, and the teachers retirement plan, the annual interest rate is 73.19six percent from the date on which the amount was deducted from the retirement annuity 73.20to the date of payment or until January 1, 2011, whichever is earlier, and no interest 73.21after January 1, 2011. For the Duluth Teachers Retirement Fund Association, the annual 73.22interest is six percent from the date on which the amount was deducted from the retirement 73.23annuity to the date of payment or until June 30, 2010, whichever is earlier, and with 73.24no interest accrual after June 30, 2010. For the St. Paul Teachers Retirement Fund 73.25Association, the annual interest is the rate of six percent from the date that the amount was 73.26deducted from the retirement annuity to the date of payment or June 30, 2011, whichever 73.27is earlier, and with no interest accrual after June 30, 2011. 73.28    (b) The written application must be on a form prescribed by the chief administrative 73.29officer of the applicable retirement plan. 73.30    (c) If the retired member dies before the payment provided for in paragraph (a) is 73.31made, the amount is payable, upon written application, to the deceased person's surviving 73.32spouse, or if none, to the deceased person's designated beneficiary, or if none, to the 73.33deceased person's estate. 73.34    (d) In lieu of the direct payment of the person's amount under subdivision 2, on 73.35or after the payment date under paragraph (a), if the federal Internal Revenue Code so 74.1permits, the retired member may elect to have all or any portion of the payment amount 74.2under this section paid in the form of a direct rollover to an eligible retirement plan as 74.3defined in section 402(c) of the federal Internal Revenue Code that is specified by the 74.4retired member. If the retired member dies with a balance remaining payable under this 74.5section, the surviving spouse of the retired member, or if none, the deceased person's 74.6designated beneficiary, or if none, the administrator of the deceased person's estate may 74.7elect a direct rollover under this paragraph. 74.8    Sec. 44. Minnesota Statutes 2012, section 356.99, subdivision 1, is amended to read: 74.9    Subdivision 1. Definitions. (a) For purposes of this section, the terms in paragraphs 74.10(b) to (e) have the meanings given them. 74.11(b) "Chief administrative officer" means the person selected or elected by the 74.12governing board of a covered pension plan with primary responsibility to administer the 74.13covered pension plan, or that person's designee or representative. 74.14(c) "Covered pension plan" means a plan enumerated in section 356.30, subdivision 74.153 , except clauses (3), (5), and (6). 74.16(d) "Governing board" means the governing board of the Minnesota State Retirement 74.17System, the Public Employees Retirement Association, the Teachers Retirement 74.18Association, the Duluth Teachers Retirement Fund Association, or the St. Paul Teachers 74.19Retirement Fund Association. 74.20(e) "Member" means an active plan member in a covered pension plan. 74.21    Sec. 45. Minnesota Statutes 2013 Supplement, section 423A.02, subdivision 3, is 74.22amended to read: 74.23    Subd. 3. Reallocation of amortization state aid. (a) Seventy percent of the 74.24difference between $5,720,000 and the current year amortization aid distributed under 74.25subdivision 1 that is not distributed for any reason to a municipality must be distributed 74.26by the commissioner of revenue according to this paragraph. The commissioner shall 74.27distribute 50 new text begin 60 new text end percent of the amounts derived under this paragraph to the Teachers 74.28Retirement Association, ten percent to the Duluth Teachers Retirement Fund Association, 74.29 and 40 percent to the St. Paul Teachers Retirement Fund Association to fund the unfunded 74.30actuarial accrued liabilities of the respective funds. These payments must be made on July 74.3115 each fiscal year. If the St. Paul Teachers Retirement Fund Association or the Duluth 74.32Teachers Retirement Fund Association becomes fully funded, the association's eligibility 74.33for its portion of this aid ceases. Amounts remaining in the undistributed balance account 74.34at the end of the biennium if aid eligibility ceases cancel to the general fund. 75.1    (b) In order to receive amortization aid under paragraph (a), before June 30 annually 75.2Independent School District No. 625, St. Paul, must make an additional contribution of 75.3$800,000 each year to the St. Paul Teachers Retirement Fund Association. 75.4    (c) Thirty percent of the difference between $5,720,000 and the current year 75.5amortization aid under subdivision 1a that is not distributed for any reason to a 75.6municipality must be distributed under section 69.021, subdivision 7, paragraph (d), as 75.7additional funding to support a minimum fire state aid amount for volunteer firefighter 75.8relief associations. 75.9    Sec. 46. new text begin CONSOLIDATION OF DULUTH TEACHERS RETIREMENT FUND new text end 75.10 new text begin ASSOCIATION. new text end 75.11     new text begin Subdivision 1. new text end new text begin Membership transfer. new text end new text begin All active, inactive, and retired members new text end 75.12 new text begin of the Duluth Teachers Retirement Fund Association are transferred to the Teachers new text end 75.13 new text begin Retirement Association and are no longer members of the Duluth Teachers Retirement new text end 75.14 new text begin Fund Association as of July 1, 2015. new text end 75.15     new text begin Subd. 2. new text end new text begin Teachers Retirement Association membership. new text end new text begin A person first hired as a new text end 75.16 new text begin teacher by Independent School District No. 709, Duluth, after June 30, 2015, and who is a new text end 75.17 new text begin teacher as defined in Minnesota Statutes, section new text end new text begin , subdivision 2, is a member of the new text end 75.18 new text begin Teachers Retirement Association for the person's subsequent teaching service. new text end 75.19     new text begin Subd. 3. new text end new text begin Service credit and liability transfer. new text end new text begin All allowable service and salary new text end 75.20 new text begin credit of the members and other individuals transferred under subdivision 1 as specified new text end 75.21 new text begin in the records of the Duluth Teachers Retirement Fund Association as of June 30, 2015, new text end 75.22 new text begin is allowable service credit under Minnesota Statutes, section new text end new text begin , subdivision 13, new text end 75.23 new text begin formula service credit under Minnesota Statutes, section new text end new text begin , subdivision 25, and new text end 75.24 new text begin salary credit under Minnesota Statutes, section new text end new text begin , subdivision 35, for the Teachers new text end 75.25 new text begin Retirement Association. new text end 75.26     new text begin Subd. 4. new text end new text begin Transfer of records. new text end new text begin On or before June 30, 2015, the chief administrative new text end 75.27 new text begin officer of the Duluth Teachers Retirement Fund Association shall transfer all records and new text end 75.28 new text begin documents relating to the funds and the benefit plans of the association to the executive new text end 75.29 new text begin director of the Teachers Retirement Association. To the extent possible, original copies of new text end 75.30 new text begin all records and documents must be transferred. new text end 75.31     new text begin Subd. 5. new text end new text begin Transfer of assets. new text end new text begin (a) On or before December 31, 2014, the chief new text end 75.32 new text begin administrative officer of the Duluth Teachers Retirement Fund Association shall transfer new text end 75.33 new text begin to the State Board of Investment for investment under Minnesota Statutes, section 11A.14, new text end 75.34 new text begin the entire assets of the special retirement fund, except for direct real estate holdings, of the new text end 75.35 new text begin Duluth Teachers Retirement Fund Association. new text end 76.1 new text begin (b) By August 1, 2014, the chief administrative officer of the Duluth Teachers new text end 76.2 new text begin Retirement Fund Association must provide to the State Board of Investment a list of new text end 76.3 new text begin assets that are intended to be transferred. new text end 76.4 new text begin (c) The executive director of the State Board of Investment shall review the assets new text end 76.5 new text begin and determine which assets are not in compliance with the requirements and limitations new text end 76.6 new text begin set forth in Minnesota Statutes, sections 11A.09, 11A.14, 11A.23, and 11A.24, or are not new text end 76.7 new text begin appropriate for retention under the established investment objectives of the State Board of new text end 76.8 new text begin Investment. Within 30 days of the date on which the asset transfer occurred, the executive new text end 76.9 new text begin director of the State Board of Investment shall provide the chief administrative officer of new text end 76.10 new text begin the Duluth Teachers Retirement Fund Association with a list of assets that are acceptable new text end 76.11 new text begin for transfer and a list of assets that are noncompliant or inappropriate. Acceptable assets, new text end 76.12 new text begin including cash, must be transferred at market value, and transfers may begin upon the new text end 76.13 new text begin transfer of legal title and notification by the chief administrative officer of the Duluth new text end 76.14 new text begin Teachers Retirement Fund Association to the State Board of Investment. new text end 76.15 new text begin (d) Assets deemed to be noncompliant or inappropriate must be retained by the new text end 76.16 new text begin Duluth Teachers Retirement Fund Association. Within 30 days of receipt of the list of new text end 76.17 new text begin noncompliant or inappropriate assets, the chief administrative officer of the Duluth new text end 76.18 new text begin Teachers Retirement Fund Association must provide the executive director of the State new text end 76.19 new text begin Board of Investment with evidence that the chief administrative officer of the Duluth new text end 76.20 new text begin Teachers Retirement Fund Association is taking action to convert noncompliant or new text end 76.21 new text begin inappropriate assets to acceptable assets. new text end 76.22 new text begin (e) Beginning January 1, 2015, the executive director of the State Board of new text end 76.23 new text begin Investment is authorized to direct the process of transferring legal title of assets for which new text end 76.24 new text begin such change is deemed necessary. new text end 76.25 new text begin (f) On June 30, 2015, the remaining assets of the special retirement fund of the new text end 76.26 new text begin Duluth Teachers Retirement Fund Association are transferred to the State Board of new text end 76.27 new text begin Investment at market values determined by the executive director of the State Board of new text end 76.28 new text begin Investment. Legal title to transferred assets vests with the State Board of Investment new text end 76.29 new text begin on behalf of the Teachers Retirement Association. The transfer of the assets of the new text end 76.30 new text begin Duluth Teachers Retirement Fund Association special retirement fund must include any new text end 76.31 new text begin investment-related accounts receivable that are determined by the executive director new text end 76.32 new text begin of the State Board of Investment as reasonably capable of being collected and any new text end 76.33 new text begin non-investment-related accounts receivable that are determined by the executive director new text end 76.34 new text begin of the Teachers Retirement Association as reasonably capable of being collected. For new text end 76.35 new text begin accounts receivable that are determined as not reasonably capable of being collected, legal new text end 76.36 new text begin title to the account transfers to Independent School District No. 709, Duluth, as of the new text end 77.1 new text begin date of the determination of the executive director of the State Board of Investment and new text end 77.2 new text begin the executive director of the Teachers Retirement Association. If the accounts receivable new text end 77.3 new text begin transferred to Independent School District No. 709, Duluth, are subsequently recovered new text end 77.4 new text begin by the school district, the superintendent of Independent School District No. 709, Duluth, new text end 77.5 new text begin shall transfer the recovered amount to the executive director of the Teachers Retirement new text end 77.6 new text begin Association, in cash, for deposit in the teachers retirement fund, less the reasonable new text end 77.7 new text begin expenses of the school district related to the recovery. If the board of trustees of the Duluth new text end 77.8 new text begin Teachers Retirement Fund Association establishes a liquidating trust and deposits any of new text end 77.9 new text begin the retirement fund association assets in that trust or if the legislative auditor determines new text end 77.10 new text begin that the transferred assets were in an amount less than the full assets of the retirement fund new text end 77.11 new text begin association other than assets in the tax sheltered annuity program on the date of transfer as new text end 77.12 new text begin specified in paragraph (g), the amount of any untransferred assets are a claim against the new text end 77.13 new text begin state aid otherwise payable to Independent School District No. 709, Duluth, payable to the new text end 77.14 new text begin Teachers Retirement Association by the commissioner of management and budget upon new text end 77.15 new text begin request by the executive director of the Teachers Retirement Association. new text end 77.16 new text begin (g) As of June 30, 2015, assets of the special retirement fund, except for direct real new text end 77.17 new text begin estate holdings, of the Duluth Teachers Retirement Fund Association are assets of the new text end 77.18 new text begin Teachers Retirement Association to be invested by the State Board of Investment under new text end 77.19 new text begin Minnesota Statutes, section 354.07, subdivision 4. new text end 77.20     new text begin Subd. 6. new text end new text begin Termination of Duluth Teachers Retirement Fund Association special new text end 77.21 new text begin retirement fund. new text end new text begin (a) As of June 30, 2015, the Duluth Teachers Retirement Fund new text end 77.22 new text begin Association as a public retirement plan and its special retirement fund ceases to exist. new text end 77.23 new text begin (b) Contracts, records, and obligations of the Duluth Teachers Retirement Fund new text end 77.24 new text begin Association special retirement fund existing at the time of consolidation with the Teachers new text end 77.25 new text begin Retirement Association are transferred to the Teachers Retirement Association under new text end 77.26 new text begin Minnesota Statutes, section new text end new text begin , subdivisions 5 and 5a, except that contracts, records, new text end 77.27 new text begin and obligations of the Duluth Teachers Retirement Fund Association special retirement new text end 77.28 new text begin fund related to investment and safekeeping of assets are transferred to the State Board new text end 77.29 new text begin of Investment under Minnesota Statutes, section new text end new text begin , subdivisions 5 and 5a. The new text end 77.30 new text begin State Board of Investment has the authority to pay the investment-related liabilities new text end 77.31 new text begin and obligations from the assets transferred from the Duluth Teachers Retirement Fund new text end 77.32 new text begin Association incurred by the Teachers Retirement Association. The legislative auditor shall new text end 77.33 new text begin audit the Duluth Teachers Retirement Fund Association for the fiscal year ending June 30, new text end 77.34 new text begin 2015, as part of the Teachers Retirement Association board's annual financial reporting new text end 77.35 new text begin requirements under Minnesota Statutes, section 356.20. The board of trustees of the new text end 77.36 new text begin Teachers Retirement Association may authorize and contract with either the legislative new text end 78.1 new text begin auditor or the state auditor to perform other audit services. Between April 1, 2015, and new text end 78.2 new text begin June 30, 2015, the Duluth Teachers Retirement Fund Association cannot incur a new or new text end 78.3 new text begin additional enforceable contractual liability or obligation without approval of the executive new text end 78.4 new text begin director of the Teachers Retirement Association. new text end 78.5    Sec. 47. new text begin DULUTH TEACHERS RETIREMENT FUND ASSOCIATION new text end 78.6 new text begin EMPLOYEES. new text end 78.7 new text begin Effective June 30, 2015, the employees of the Duluth Teachers Retirement new text end 78.8 new text begin Fund Association have their employment with the Duluth Teachers Retirement Fund new text end 78.9 new text begin Association terminated and, effective July 1, 2015, unless the former employee elects new text end 78.10 new text begin otherwise, the Duluth Teachers Retirement Fund Association employees, excluding the new text end 78.11 new text begin Executive Director, become employees of the Teachers Retirement Association. The new text end 78.12 new text begin commissioner of management and budget shall place employees from the former Duluth new text end 78.13 new text begin Teachers Retirement Fund Association into state service in their proper classifications, new text end 78.14 new text begin except that employees are appointed without examination and must be compensated at no new text end 78.15 new text begin less than their current hourly salary rate. Employees must have their accumulated, but new text end 78.16 new text begin unused, vacation leave balance as of June 30, 2015, posted to their credit by the Teachers new text end 78.17 new text begin Retirement Association, but if the employee has vacation time in excess of the applicable new text end 78.18 new text begin maximum, no additional vacation may accrue until the employee's balance falls below new text end 78.19 new text begin the maximum permitted by the state for the employee's position. The employees must new text end 78.20 new text begin receive length of service credit for vacation leave accrual for time served at the Duluth new text end 78.21 new text begin Teachers Retirement Fund Association. Duluth Teachers Retirement Fund Association new text end 78.22 new text begin employees who become employees of the Teachers Retirement Association effective on new text end 78.23 new text begin July 1, 2015, must be considered to have completed six months of continuous service new text end 78.24 new text begin for vacation use purposes. Employees of the former Duluth Teachers Retirement Fund new text end 78.25 new text begin Association appointed to the classified service are subject to a probationary period under new text end 78.26 new text begin the collective bargaining agreement or compensation plan applicable to the employee's new text end 78.27 new text begin position at the Teachers Retirement Association. Effective July 1, 2015, all transferred new text end 78.28 new text begin employees must be enrolled in the state employees' group insurance program as provided new text end 78.29 new text begin in Minnesota Statutes, sections 43A.22 to 43A.31, and the commissioner of management new text end 78.30 new text begin and budget shall provide open enrollment in all state employee health and dental insurance new text end 78.31 new text begin plans with no limitation on preexisting conditions except as specified in existing state new text end 78.32 new text begin employee certificates of coverage. The commissioner of management and budget shall new text end 78.33 new text begin provide these transferred employees with the opportunity to purchase optional life and new text end 78.34 new text begin disability insurance as provided by the state group insurance program in accordance with new text end 78.35 new text begin the policies of management and budget. new text end 79.1    Sec. 48. new text begin REPEALER. new text end 79.2 new text begin (a) new text end new text begin Minnesota Statutes 2012, sections 354A.021, subdivision 5; 354A.108; 354A.24; new text end 79.3 new text begin and 354A.27, subdivision 5, new text end new text begin are repealed. new text end 79.4 new text begin (b) new text end new text begin Minnesota Statutes 2013 Supplement, sections 354A.27, subdivisions 6a and 7; new text end 79.5 new text begin and 354A.31, subdivision 4a, new text end new text begin are repealed. new text end 79.6    Sec. 49. new text begin EFFECTIVE DATE. new text end 79.7 new text begin (a) Section 46, subdivision 5, is effective October 1, 2014. Sections 1 to 14, 16 to new text end 79.8 new text begin 45, 46, subdivisions 1 to 4 and 6, 47, and 49 are effective June 30, 2015, if the following new text end 79.9 new text begin approve the consolidation provisions before October 1, 2014: new text end 79.10 new text begin (1) the board of trustees of the Duluth Teachers Retirement Fund Association; new text end 79.11 new text begin (2) the membership of the Duluth Teachers Retirement Fund Association; and new text end 79.12 new text begin (3) the board of trustees of the Teachers Retirement Association. new text end 79.13 new text begin (b) An approval under paragraph (a) must be provided in a timely manner in new text end 79.14 new text begin compliance with Minnesota Statutes, section 645.021, subdivisions 2 and 3, to the secretary new text end 79.15 new text begin of state, the state auditor, the legislative auditor, and the revisor of statutes by the chief new text end 79.16 new text begin administrative officer of the Duluth Teachers Retirement Fund Association for an approval new text end 79.17 new text begin under paragraph (a) by the board of trustees of the Duluth Teachers Retirement Fund new text end 79.18 new text begin Association or by the membership of the Duluth Teachers Retirement Fund Association and new text end 79.19 new text begin by the chief administrative officer of the Teachers Retirement Association for an approval new text end 79.20 new text begin under paragraph (a) by the board of trustees of the Teachers Retirement Association. new text end 79.21ARTICLE 7 79.22FIRST CLASS CITY TEACHER RETIREMENT FUND 79.23ASSOCIATION CHANGES 79.24    Section 1. Minnesota Statutes 2013 Supplement, section 354A.12, subdivision 3a, 79.25is amended to read: 79.26    Subd. 3a. Special Direct state aid to first class city teachers retirement fund 79.27associations. (a) The state shall pay $346,000 as special direct state aid to the Duluth 79.28Teachers Retirement Fund Association and $2,827,000 to the St. Paul Teachers Retirement 79.29Fund Association. 79.30 new text begin (b) In addition to other amounts specified in this subdivision, the state shall pay new text end 79.31 new text begin $7,000,000 as state aid to the St. Paul Teachers Retirement Fund Association. new text end 79.32    (b) new text begin (c) new text end The aids under this subdivision are payable October 1 annually. The 79.33commissioner of management and budget shall pay the aids specified in this subdivision. 80.1The amounts required are appropriated annually from the general fund to the commissioner 80.2of management and budget. 80.3 new text begin EFFECTIVE DATE. new text end new text begin This section is effective September 30, 2016. new text end 80.4    Sec. 2. Minnesota Statutes 2013 Supplement, section 354A.12, subdivision 3c, is 80.5amended to read: 80.6    Subd. 3c. Termination of supplemental contributions and direct matching 80.7and state aid. (a) The supplemental contributions payable to the St. Paul Teachers 80.8Retirement Fund Association by Independent School District No. 625 under section 80.9423A.02, subdivision 3 , and all forms of state aid under subdivision 3a to the St. Paul 80.10Teachers Retirement Fund Association must continue until the current assets of the fund 80.11equal or exceed the actuarial accrued liability of the fund as determined in the most recent 80.12actuarial report for the fund by the actuary retained under section 356.214 or until June 80.1330, 2037 new text begin the established date for full funding under section 356.215, subdivision 11 new text end , 80.14whichever occurs earlier. 80.15(b) The aid to the Duluth Teachers Retirement Fund Association under section 80.16423A.02, subdivision 3 , and all forms of state aid under subdivision 3a to the Duluth 80.17Teachers Retirement Fund Association must continue until the current assets of the fund 80.18equal or exceed the actuarial accrued liability of the fund as determined in the most 80.19recent actuarial report for the fund by the actuary retained under section 356.214 or until 80.20the established date for full funding under section 356.215, subdivision 11, whichever 80.21occurs earlier. 80.22 new text begin EFFECTIVE DATE. new text end new text begin This section is effective the day following final enactment. new text end 80.23    Sec. 3. Minnesota Statutes 2012, section 356.215, subdivision 11, is amended to read: 80.24    Subd. 11. Amortization contributions. (a) In addition to the exhibit indicating 80.25the level normal cost, the actuarial valuation of the retirement plan must contain an 80.26exhibit for financial reporting purposes indicating the additional annual contribution 80.27sufficient to amortize the unfunded actuarial accrued liability and must contain an exhibit 80.28for contribution determination purposes indicating the additional contribution sufficient 80.29to amortize the unfunded actuarial accrued liability. For the retirement plans listed in 80.30subdivision 8, paragraph (c), but excluding the MERF division of the Public Employees 80.31Retirement Association and the legislators retirement plan, the additional contribution 80.32must be calculated on a level percentage of covered payroll basis by the established 80.33date for full funding in effect when the valuation is prepared, assuming annual payroll 81.1growth at the applicable percentage rate set forth in subdivision 8, paragraph (c). For all 81.2other retirement plans and for the MERF division of the Public Employees Retirement 81.3Association and the legislators retirement plan, the additional annual contribution must be 81.4calculated on a level annual dollar amount basis. 81.5    (b) For any retirement plan other than the general state employees retirement plan 81.6of the Minnesota State Retirement System or a retirement plan governed by paragraph 81.7(d), (e), (f), (g), (h), (i), or (j), if there has not been a change in the actuarial assumptions 81.8used for calculating the actuarial accrued liability of the fund, a change in the benefit 81.9plan governing annuities and benefits payable from the fund, a change in the actuarial 81.10cost method used in calculating the actuarial accrued liability of all or a portion of the 81.11fund, or a combination of the three, which change or changes by itself or by themselves 81.12without inclusion of any other items of increase or decrease produce a net increase in the 81.13unfunded actuarial accrued liability of the fund, the established date for full funding is the 81.14first actuarial valuation date occurring after June 1, 2020. 81.15    (c) For any retirement plan other than the general employees retirement plan of the 81.16Public Employees Retirement Association, if there has been a change in any or all of the 81.17actuarial assumptions used for calculating the actuarial accrued liability of the fund, a 81.18change in the benefit plan governing annuities and benefits payable from the fund, a 81.19change in the actuarial cost method used in calculating the actuarial accrued liability of all 81.20or a portion of the fund, or a combination of the three, and the change or changes, by itself 81.21or by themselves and without inclusion of any other items of increase or decrease, produce 81.22a net increase in the unfunded actuarial accrued liability in the fund, the established date 81.23for full funding must be determined using the following procedure: 81.24    (i) the unfunded actuarial accrued liability of the fund must be determined in 81.25accordance with the plan provisions governing annuities and retirement benefits and the 81.26actuarial assumptions in effect before an applicable change; 81.27    (ii) the level annual dollar contribution or level percentage, whichever is applicable, 81.28needed to amortize the unfunded actuarial accrued liability amount determined under item 81.29(i) by the established date for full funding in effect before the change must be calculated 81.30using the interest assumption specified in subdivision 8 in effect before the change; 81.31    (iii) the unfunded actuarial accrued liability of the fund must be determined in 81.32accordance with any new plan provisions governing annuities and benefits payable from 81.33the fund and any new actuarial assumptions and the remaining plan provisions governing 81.34annuities and benefits payable from the fund and actuarial assumptions in effect before 81.35the change; 82.1    (iv) the level annual dollar contribution or level percentage, whichever is applicable, 82.2needed to amortize the difference between the unfunded actuarial accrued liability amount 82.3calculated under item (i) and the unfunded actuarial accrued liability amount calculated 82.4under item (iii) over a period of 30 years from the end of the plan year in which the 82.5applicable change is effective must be calculated using the applicable interest assumption 82.6specified in subdivision 8 in effect after any applicable change; 82.7    (v) the level annual dollar or level percentage amortization contribution under item 82.8(iv) must be added to the level annual dollar amortization contribution or level percentage 82.9calculated under item (ii); 82.10    (vi) the period in which the unfunded actuarial accrued liability amount determined 82.11in item (iii) is amortized by the total level annual dollar or level percentage amortization 82.12contribution computed under item (v) must be calculated using the interest assumption 82.13specified in subdivision 8 in effect after any applicable change, rounded to the nearest 82.14integral number of years, but not to exceed 30 years from the end of the plan year in which 82.15the determination of the established date for full funding using the procedure set forth in this 82.16clause is made and not to be less than the period of years beginning in the plan year in which 82.17the determination of the established date for full funding using the procedure set forth in 82.18this clause is made and ending by the date for full funding in effect before the change; and 82.19    (vii) the period determined under item (vi) must be added to the date as of which 82.20the actuarial valuation was prepared and the date obtained is the new established date 82.21for full funding. 82.22    (d) For the MERF division of the Public Employees Retirement Association, the 82.23established date for full funding is June 30, 2031. 82.24    (e) For the general employees retirement plan of the Public Employees Retirement 82.25Association, the established date for full funding is June 30, 2031. 82.26    (f) For the Teachers Retirement Association, the established date for full funding is 82.27June 30, 2037. 82.28    (g) For the correctional state employees retirement plan of the Minnesota State 82.29Retirement System, the established date for full funding is June 30, 2038. 82.30    (h) For the judges retirement plan, the established date for full funding is June 82.3130, 2038. 82.32    (i) For the public employees police and fire retirement plan, the established date 82.33for full funding is June 30, 2038. 82.34    (j) For the St. Paul Teachers Retirement Fund Association, the established date for 82.35full funding is June 30 of the 25th year from the valuation date new text begin , 2042 new text end . In addition to 82.36other requirements of this chapter, the annual actuarial valuation must contain an exhibit 83.1indicating the funded ratio and the deficiency or sufficiency in annual contributions when 83.2comparing liabilities to the market value of the assets of the fund as of the close of the 83.3most recent fiscal year. 83.4(k) For the general state employees retirement plan of the Minnesota State 83.5Retirement System, the established date for full funding is June 30, 2040. 83.6    (l) For the retirement plans for which the annual actuarial valuation indicates an 83.7excess of valuation assets over the actuarial accrued liability, the valuation assets in 83.8excess of the actuarial accrued liability must be recognized as a reduction in the current 83.9contribution requirements by an amount equal to the amortization of the excess expressed 83.10as a level percentage of pay over a 30-year period beginning anew with each annual 83.11actuarial valuation of the plan. 83.12 new text begin EFFECTIVE DATE. new text end new text begin This section is effective the day following final enactment. new text end 83.13ARTICLE 8 83.14MNSCU-RELATED PROVISIONS 83.15    Section 1. Minnesota Statutes 2012, section 136F.481, is amended to read: 83.16136F.481 EARLY SEPARATION INCENTIVE PROGRAM. 83.17(a) Notwithstanding any provision of law to the contrary, the Board of Trustees 83.18of the Minnesota State Colleges and Universities may offer a targeted early separation 83.19incentive program for its employees. 83.20(b) The early separation incentive program may include one or both of the following: 83.21(1) cash incentives, not to exceed one year of base salary; or 83.22(2) employer contributions to the postretirement healthcare savings plan established 83.23under section 352.98. 83.24(c) To be eligible to receive an incentive, an employee must be at least age 55 83.25and must have at least five years of employment by the Minnesota State Colleges and 83.26Universities System. The board of trustees shall establish new text begin and periodically revise new text end the 83.27eligibility requirements for system employees to receive an incentive. The board of 83.28trustees shall file a copy of its proposed new text begin revised new text end eligibility requirements with the chairs 83.29and ranking members of the senate committee on new text begin with new text end higher education new text begin within its new text end 83.30 new text begin jurisdiction new text end and the Higher Education budget and Policy new text begin senate finance new text end division of the 83.31senate Committee on Finance new text begin with higher education within its jurisdiction new text end and with the 83.32chair and ranking members of the Higher Education and Workforce Development Finance 83.33and Policy Division of the Finance committee of new text begin in new text end the house of representatives new text begin with new text end 83.34 new text begin higher education within its jurisdiction and of the house of representatives Committee new text end 84.1 new text begin on Ways and Means, new text end at least 30 days before their new text begin the new text end final adoption new text begin of the proposed new text end 84.2 new text begin revised eligibility requirements new text end by the board of trustees, shall post the same document 84.3on the system Web site at the same time, and shall hold a public hearing on the proposed 84.4eligibility requirements. The type and any additional amount of the incentive to be offered 84.5may vary by employee classification, as specified by the board. 84.6(d) The president of a college or university, consistent with paragraphs (b) and 84.7(c), may designate: 84.8(1) specific departments or programs at the college or university whose employees 84.9are eligible to be offered the incentive program; or 84.10(2) positions at the college or university eligible to be offered the incentive program. 84.11(e) The chancellor, consistent with paragraphs (b) and (c), may designate: 84.12(1) system office divisions whose employees are eligible to be offered the incentive 84.13program; or 84.14(2) positions at the system office eligible to be offered the incentive program. 84.15(f) Acceptance of the offered incentive must be voluntary on the part of the employee 84.16and must be in writing. The incentive may only be offered at the sole discretion of the 84.17president of the applicable college or university. 84.18(g) A decision by the president of a college or university or by the chancellor not to 84.19offer an incentive may not be challenged. 84.20(h) The cost of the incentive is payable by the college or university on whose behalf 84.21the president offered the incentive or from the system office budget if the chancellor offered 84.22the incentive. If a college or university is merged, the remaining cost of any early separation 84.23incentive must be borne by the successor institution. If a college or university is closed, 84.24the remaining cost of any early separation incentive must be borne by the board of trustees. 84.25(i) Annually, the chancellor and the president of each college or university must 84.26report on the number and types of early separation incentives which were offered and 84.27utilized under this section. The report must be filed annually with the board of trustees and 84.28with the Legislative Reference Library on or before September 1. 84.29 new text begin (j) The early retirement incentive authority under this section expires on June 30, new text end 84.30 new text begin 2019. new text end 84.31 new text begin EFFECTIVE DATE. new text end new text begin This section is effective the day following final enactment. new text end 84.32    Sec. 2. Minnesota Statutes 2012, section 352.1155, subdivision 1, is amended to read: 84.33    Subdivision 1. Eligibility. Except as indicated in subdivision 4, the annuity 84.34reduction provisions of section 352.115, subdivision 10, do not apply to a person who: 85.1(1) retires from the Minnesota State Colleges and Universities system with at least 85.2ten years of combined service credit in a system under the jurisdiction of the Board of 85.3Trustees of the Minnesota State Colleges and Universities; 85.4(2) was employed on a full-time basis immediately preceding retirement as a faculty 85.5member or as an unclassified administrator in that system; 85.6 new text begin (3) was not a recipient of an early retirement incentive under section 136F.481; new text end 85.7(3) new text begin (4) new text end begins drawing an annuity from the general state employees retirement plan 85.8of the Minnesota State Retirement System; and 85.9(4) new text begin (5) new text end returns to work on not less than a one-third time basis and not more than a 85.10two-thirds time basis in the system from which the person retired under an agreement in 85.11which the person may not earn a salary of more than $46,000 new text begin $62,000 new text end in a calendar year 85.12from new text begin through new text end employment after retirement in the system from which the person retired. 85.13 new text begin EFFECTIVE DATE. new text end new text begin This section is effective July 1, 2014. new text end 85.14    Sec. 3. Minnesota Statutes 2012, section 352.1155, subdivision 4, is amended to read: 85.15    Subd. 4. Exemption limit. For a person eligible under this section who earns more 85.16than $46,000 new text begin $62,000 new text end in a calendar year from new text begin through new text end reemployment in the Minnesota 85.17State Colleges and Universities system following retirement, the annuity reduction 85.18provisions of section 352.115, subdivision 10, apply only to income over $46,000 new text begin $62,000 new text end . 85.19 new text begin EFFECTIVE DATE. new text end new text begin This section is effective July 1, 2014. new text end 85.20    Sec. 4. Minnesota Statutes 2012, section 354.445, is amended to read: 85.21354.445 NO ANNUITY REDUCTION. 85.22(a) The annuity reduction provisions of section 354.44, subdivision 5, do not apply 85.23to a person who: 85.24(1) retires from the Minnesota State Colleges and Universities system with at least 85.25ten years of combined service credit in a system under the jurisdiction of the Board of 85.26Trustees of the Minnesota State Colleges and Universities; 85.27(2) was employed on a full-time basis immediately preceding retirement as a faculty 85.28member or as an unclassified administrator in that system; 85.29 new text begin (3) was not a recipient of an early retirement incentive under section 136F.481; new text end 85.30(3) new text begin (4) new text end begins drawing an annuity from the teachers retirement association; and 85.31(4) new text begin (5) new text end returns to work on not less than a one-third time basis and not more than a 85.32two-thirds time basis in the system from which the person retired under an agreement in 86.1which the person may not earn a salary of more than $46,000 new text begin $62,000 new text end in a calendar year 86.2from new text begin through new text end employment after retirement in the system from which the person retired. 86.3(b) Initial participation, the amount of time worked, and the duration of participation 86.4under this section must be mutually agreed upon by the president of the institution where 86.5the person returns to work and the employee. The president may require up to one-year 86.6notice of intent to participate in the program as a condition of participation under this 86.7section. The president shall determine the time of year the employee shall work. The 86.8employer or the president may not require a person to waive any rights under a collective 86.9bargaining agreement as a condition of participation under this section. 86.10(c) Notwithstanding any law to the contrary, a person eligible under paragraphs (a) 86.11and (b) may not, based on employment to which the waiver in this section applies, earn 86.12further service credit in a Minnesota public defined benefit plan and is not eligible to 86.13participate in a Minnesota public defined contribution plan, other than a volunteer fire plan 86.14governed by chapter 424A. No employer or employee contribution to any of these plans 86.15may be made on behalf of such a person. 86.16(d) For a person eligible under paragraphs (a) and (b) who earns more than $46,000 86.17 new text begin $62,000 new text end in a calendar year from new text begin through new text end employment after retirement due to employment 86.18by the Minnesota state colleges and universities system, the annuity reduction provisions 86.19of section 354.44, subdivision 5, apply only to income over $46,000 new text begin $62,000 new text end . 86.20(e) A person who returns to work under this section is a member of the appropriate 86.21bargaining unit and is covered by the appropriate collective bargaining contract. Except 86.22as provided in this section, the person's coverage is subject to any part of the contract 86.23limiting rights of part-time employees. 86.24 new text begin EFFECTIVE DATE. new text end new text begin This section is effective July 1, 2014. new text end 86.25    Sec. 5. Minnesota Statutes 2012, section 354A.31, subdivision 3a, is amended to read: 86.26    Subd. 3a. No annuity reduction. (a) The annuity reduction provisions of 86.27subdivision 3 do not apply to a person who: 86.28(1) retires from the technical college system with at least ten years of service credit 86.29in the system from which the person retires; 86.30(2) was employed on a full-time basis immediately preceding retirement as a 86.31technical college faculty member; 86.32 new text begin (3) was not a recipient of an early retirement incentive under section 136F.481; new text end 86.33(3) new text begin (4) new text end begins drawing an annuity from a first class city teachers retirement 86.34association; and 87.1(4) new text begin (5) new text end returns to work on not less than a one-third time basis and not more than a 87.2two-thirds time basis in the technical college system under an agreement in which the 87.3person may not earn a salary of more than $46,000 new text begin $62,000 new text end in a calendar year from 87.4 new text begin through new text end the technical college system. 87.5(b) Initial participation, the amount of time worked, and the duration of participation 87.6under this section must be mutually agreed upon by the employer and the employee. The 87.7employer may require up to a one-year notice of intent to participate in the program as a 87.8condition of participation under this section. The employer shall determine the time 87.9of year the employee shall work. 87.10(c) Notwithstanding any law to the contrary, a person eligible under paragraphs 87.11(a) and (b) may not earn further service credit in a first class city teachers retirement 87.12association and is not eligible to participate in the individual retirement account plan or 87.13the supplemental retirement plan established in chapter 354B as a result of service under 87.14this section. No employer or employee contribution to any of these plans may be made on 87.15behalf of such a person. 87.16 new text begin EFFECTIVE DATE. new text end new text begin This section is effective July 1, 2014. new text end 87.17    Sec. 6. Minnesota Statutes 2012, section 354B.21, subdivision 2, is amended to read: 87.18    Subd. 2. Coverage; election. (a) An eligible person employed by the board has 87.19the default coverage specified in subdivision 3, or other subdivisions of this section, 87.20whichever is applicable, and retains that coverage for the period of covered employment 87.21unless a timely election to change that coverage is made as specified in this section. 87.22(b) An eligible person under subdivision 3, paragraph (b) or (c), is authorized to elect 87.23prospective Teachers Retirement Association plan coverage. 87.24(c) An eligible person under subdivision 3, paragraph (d), is authorized to elect 87.25prospective coverage by the plan established by this chapter. 87.26(d) The election under paragraph (a) must be made within one year of commencing 87.27eligible Minnesota State Colleges and Universities system employment. If an election 87.28is not made within the specified election period due to a termination of Minnesota State 87.29Colleges and Universities system employment, an election may be made within 90 days 87.30of returning to eligible Minnesota State Colleges and Universities system employment. 87.31Except as specified in paragraph (f), all elections are irrevocable. 87.32(e) Except as provided in paragraph (f), a purchase of service credit in the Teachers 87.33Retirement Association plan for any period or periods of Minnesota State Colleges 87.34and Universities system employment occurring before the election under this section 87.35is prohibited. 88.1(f) Notwithstanding other paragraphs in this subdivision, a faculty member who 88.2is a member of the individual retirement account plan may elect to transfer retirement 88.3coverage to the teachers retirement plan within one year of the faculty member first 88.4achieving tenure or its equivalent at a Minnesota state college or university. The faculty 88.5member electing Teachers Retirement Association coverage under this paragraph must 88.6purchase service credit in the Teachers Retirement Association for the entire period of 88.7time covered under the individual retirement account plan and the purchase payment 88.8amount must be determined under section 356.551. The Teachers Retirement Association 88.9may charge a faculty member transferring coverage a reasonable fee to cover the costs 88.10associated with computing the actuarial cost of purchasing service credit and making the 88.11transfer. A faculty member transferring from the individual retirement account plan to the 88.12Teachers Retirement Association may use any balances to the credit of the faculty member 88.13in the individual retirement account plan, any balances to the credit of the faculty member 88.14in the higher education supplemental retirement plan established under chapter 354C, or 88.15any source specified in section 356.441, subdivision 1, to purchase the service credit in the 88.16Teachers Retirement Association. If the total amount of payments under this paragraph are 88.17less than the total purchase payment amount under section 356.551, the payment amounts 88.18must be refunded to the applicable source. The retirement coverage transfer and service 88.19credit purchase authority under this paragraph expires with respect to any Minnesota State 88.20Colleges and Universities System faculty initially hired after June 30, 2014. 88.21 new text begin EFFECTIVE DATE. new text end new text begin This section is effective July 1, 2014. new text end 88.22    Sec. 7. Laws 2009, chapter 169, article 6, section 1, the effective date, is amended to 88.23read: 88.24EFFECTIVE DATE; SUNSET.This section is effective the day following final 88.25enactment and expires June 30, 2014. 88.26 new text begin EFFECTIVE DATE. new text end new text begin This section is effective the day following final enactment. new text end 88.27ARTICLE 9 88.28POLICE AND FIREFIGHTER PENSION CHANGES 88.29    Section 1. Minnesota Statutes 2012, section 353.6511, subdivision 7, is amended to read: 88.30    Subd. 7. Postretirement adjustments. Effective January 1, 2012, service pensions 88.31and survivor benefits in force are entitled to be recomputed with the number of units 88.32specified in subdivision 2, subdivision 4, and subdivision 6. Optional annuities under 89.1Minnesota Statutes 2010, section 423C.05, subdivision 8, also are entitled to be recomputed 89.2as the actuarial equivalent of the service pensions and survivor benefits with the number of 89.3units specified in subdivision 2, subdivision 4, and subdivision 6. Retirement annuities, 89.4service pensions, disability benefits, and survivor benefits after December 31, 2015, are 89.5eligible for postretirement adjustments under section 356.415, subdivision 1c. The unit 89.6value for the calculation of a retirement annuity first payable after December 31, 2015, is 89.7the calendar year 2015 unit value, plus any new text begin annual new text end postretirement adjustment percentage 89.8amount new text begin payable after December 31, 2015, new text end under section 356.415, subdivision 1c, payable 89.9after December 31, 2015, and before the date of retirement new text begin paragraph (a), clause (1), or, new text end 89.10 new text begin when applicable, under section 356.415, subdivision 1c, paragraph (b), clause (1) new text end . 89.11    Sec. 2. Minnesota Statutes 2012, section 353.6512, subdivision 7, is amended to read: 89.12    Subd. 7. Postretirement adjustments. Retirement annuities, service pensions, 89.13disability benefits, and survivor benefits after December 31, 2015, are eligible for 89.14postretirement adjustments under section 356.415, subdivision 1c. The unit value for the 89.15calculation of a retirement annuity first payable after December 31, 2015, is the calendar 89.16year 2015 unit value, plus any new text begin annual new text end postretirement adjustment percentage amount 89.17 new text begin payable after December 31, 2015, new text end under section 356.415, subdivision 1c, payable after 89.18December 31, 2015, and before the date of retirement new text begin paragraph (a), clause (1), or, when new text end 89.19 new text begin applicable, under section 356.415, subdivision 1c, paragraph (b), clause (1) new text end . 89.20    Sec. 3. Minnesota Statutes 2013 Supplement, section 423A.02, subdivision 3, is 89.21amended to read: 89.22    Subd. 3. Reallocation of amortization state aid. (a) Seventy percent of the 89.23difference between $5,720,000 and the current year amortization aid distributed under 89.24subdivision 1 that is not distributed for any reason to a municipality must be distributed 89.25by the commissioner of revenue according to this paragraph. The commissioner shall 89.26distribute 50 percent of the amounts derived under this paragraph to the Teachers 89.27Retirement Association, ten percent to the Duluth Teachers Retirement Fund Association, 89.28and 40 percent to the St. Paul Teachers Retirement Fund Association to fund the unfunded 89.29actuarial accrued liabilities of the respective funds. These payments must be made on July 89.3015 each fiscal year. If the St. Paul Teachers Retirement Fund Association or the Duluth 89.31Teachers Retirement Fund Association becomes fully funded, the association's eligibility 89.32for its portion of this aid ceases. Amounts remaining in the undistributed balance account 89.33at the end of the biennium if aid eligibility ceases cancel to the general fund. 90.1    (b) In order to receive amortization aid under paragraph (a), before June 30 annually 90.2Independent School District No. 625, St. Paul, must make an additional contribution of 90.3$800,000 each year to the St. Paul Teachers Retirement Fund Association. 90.4    (c) Thirty percent of the difference between $5,720,000 and the current year 90.5amortization aid under subdivision 1a new text begin 1 new text end that is not distributed for any reason to a 90.6municipality must be distributed under section 69.021, subdivision 7, paragraph (d), as 90.7additional funding to support a minimum fire state aid amount for volunteer firefighter 90.8relief associations. 90.9 new text begin EFFECTIVE DATE. new text end new text begin This section is effective retroactively from July 1, 2013. new text end 90.10    Sec. 4. Minnesota Statutes 2013 Supplement, section 423A.022, subdivision 2, is 90.11amended to read: 90.12    Subd. 2. Allocation. new text begin (a) new text end Of the total amount appropriated as supplemental state aid: 90.13    (1) 58.065 new text begin 58.064 new text end percent must be paid to the executive director of the Public 90.14Employees Retirement Association for deposit in the public employees police and fire 90.15retirement fund established by section 353.65, subdivision 1; 90.16    (2) 35.484 percent must be paid to municipalities other than municipalities solely 90.17employing firefighters with retirement coverage provided by the public employees police 90.18and fire retirement plan which qualified to receive fire state aid in that calendar year, 90.19allocated in proportion to the most recent amount of fire state aid paid under section 90.2069.021, subdivision 7 , for the municipality bears to the most recent total fire state aid 90.21for all municipalities other than the municipalities solely employing firefighters with 90.22retirement coverage provided by the public employees police and fire retirement plan 90.23paid under section 69.021, subdivision 7, with the allocated amount for fire departments 90.24participating in the voluntary statewide lump-sum volunteer firefighter retirement plan 90.25paid to the executive director of the Public Employees Retirement Association for deposit 90.26in the fund established by section 353G.02, subdivision 3, and credited to the respective 90.27account and with the balance paid to the treasurer of each municipality for transmittal 90.28within 30 days of receipt to the treasurer of the applicable volunteer firefighter relief 90.29association for deposit in its special fund; and 90.30    (3) 6.452 percent must be paid to the executive director of the Minnesota State 90.31Retirement System for deposit in the state patrol retirement fund. 90.32 new text begin (b) For purposes of this section, the term "municipalities" includes independent new text end 90.33 new text begin nonprofit firefighting corporations that participate in the voluntary statewide lump-sum new text end 90.34 new text begin volunteer firefighter retirement plan under chapter 353G or with subsidiary volunteer new text end 90.35 new text begin firefighter relief associations operating under chapter 424A. new text end 91.1 new text begin EFFECTIVE DATE. new text end new text begin This section is effective the day following final enactment. new text end 91.2    Sec. 5. Minnesota Statutes 2013 Supplement, section 423A.022, subdivision 3, is 91.3amended to read: 91.4    Subd. 3. Reporting; definitions. (a) On or before September 1, annually, the 91.5executive director of the Public Employees Retirement Association shall report to the 91.6commissioner of revenue the following: 91.7    (1) the municipalities which employ firefighters with retirement coverage by the 91.8public employees police and fire retirement plan; 91.9    (2) the number of firefighters with public employees police and fire retirement plan 91.10coverage employed by each municipality; 91.11    (3) the fire departments covered by the voluntary statewide lump-sum volunteer 91.12firefighter retirement plan; and 91.13    (4) any other information requested by the commissioner to administer the police 91.14and firefighter retirement supplemental state aid program. 91.15    (b) For this subdivision, (i) the number of firefighters employed by a municipality 91.16who have public employees police and fire retirement plan coverage means the number 91.17of firefighters with public employees police and fire retirement plan coverage that were 91.18employed by the municipality for not less than 30 hours per week for a minimum of six 91.19months prior to December 31 preceding the date of the payment under this section and, if 91.20the person was employed for less than the full year, prorated to the number of full months 91.21employed; and (ii) the number of active police officers certified for police state aid receipt 91.22under section 69.011, subdivisions 2 and 2b, means, for each municipality, the number of 91.23police officers meeting the definition of peace officer in section 69.011, subdivision 1, 91.24counted as provided and limited by section 69.011, subdivisions 2 and 2b. 91.25 new text begin EFFECTIVE DATE. new text end new text begin This section is effective the day following final enactment. new text end 91.26    Sec. 6. new text begin ADDITIONAL SUPPLEMENTAL AID REVISION FOR OMITTED 2013 new text end 91.27 new text begin INDEPENDENT NONPROFIT FIREFIGHTING CORPORATIONS. new text end 91.28 new text begin (a) Notwithstanding any provision of Minnesota Statutes, chapter 423A, to the new text end 91.29 new text begin contrary, this section modifies the allocation of the police and fire supplemental retirement new text end 91.30 new text begin state aid under Minnesota Statutes 2013 Supplement, section 423A.022, for October new text end 91.31 new text begin 1, 2014. new text end 91.32 new text begin (b) Before the allocation of the police and fire supplemental retirement state aid is new text end 91.33 new text begin made for October 1, 2014, the commissioner of revenue shall: new text end 92.1 new text begin (1) determine those fire departments that qualified for fire state aid under Minnesota new text end 92.2 new text begin Statutes 2012, section 69.021, subdivision 7, on October 1, 2013, that did not receive a new text end 92.3 new text begin 2013 allocation of police and fire supplemental retirement state aid, and that were an new text end 92.4 new text begin independent nonprofit firefighting corporation; and new text end 92.5 new text begin (2) determine the amount of police and fire supplemental retirement state aid new text end 92.6 new text begin under Minnesota Statutes 2013 Supplement, section 423A.022, that the fire departments new text end 92.7 new text begin described in clause (1) would have received on October 1, 2013, if the fire departments new text end 92.8 new text begin had been included in that allocation. new text end 92.9 new text begin (c) The total amount determined in paragraph (b), clause (2), must be deducted from new text end 92.10 new text begin the amount available for allocation under Minnesota Statutes 2013 Supplement, section new text end 92.11 new text begin 423A.022, subdivision 2, clause (2), and the commissioner of revenue shall pay to the fire new text end 92.12 new text begin departments determined in paragraph (b), clause (1), their respective portion of the total as new text end 92.13 new text begin an additional payment on October 1, 2014. new text end 92.14 new text begin (d) The remaining amount after the deduction of the total amount under paragraph new text end 92.15 new text begin (c) must be allocated as provided in Minnesota Statutes, section 423A.022, subdivision 2. new text end 92.16    Sec. 7. new text begin PERA; STUDY OF LOCAL RELIEF ASSOCIATION BENEFITS new text end 92.17 new text begin UNDER CONSOLIDATION. new text end 92.18 new text begin The executive director of the Public Employees Retirement Association shall new text end 92.19 new text begin report to the Legislative Commission on Pensions and Retirement by February 1, 2015, new text end 92.20 new text begin regarding the situation of former members and surviving spouses of former members of new text end 92.21 new text begin local salaried police and fire relief associations governed by Minnesota Statutes, chapter new text end 92.22 new text begin 423A, that consolidated with the public employees police and fire retirement plan under new text end 92.23 new text begin Minnesota Statutes, chapter 353A, and Laws 1999, chapter 222, article 4. new text end 92.24 new text begin EFFECTIVE DATE. new text end new text begin This section is effective the day following final enactment. new text end 92.25ARTICLE 10 92.26ACTUARIAL ASSUMPTION CHANGES 92.27    Section 1. Minnesota Statutes 2013 Supplement, section 356.215, subdivision 8, 92.28is amended to read: 92.29    Subd. 8. Interest and salary assumptions. (a) The actuarial valuation must use 92.30the applicable following preretirement interest assumption and the applicable following 92.31postretirement interest assumption: 92.32(1) select and ultimate interest rate assumption 93.1 93.2 93.3 93.4 plan ultimate preretirement interest rate assumption ultimate postretirement interest rate assumption 93.5 general state employees retirement plan 8.5% 6.0% 93.6 correctional state employees retirement plan 8.5 6.0 93.7 State Patrol retirement plan 8.5 6.0 93.8 93.9 93.10 legislators retirement plan, and for the constitutional officers calculation of total plan liabilities 0.0 0.0 93.11 judges retirement plan 8.5 6.0 93.12 general public employees retirement plan 8.5 6.0 93.13 public employees police and fire retirement plan 8.5 6.0 93.14 93.15 local government correctional service retirement plan 8.5 6.0 93.16 teachers retirement plan 8.5 6.0 93.17 Duluth teachers retirement plan 8.5 8.5 93.18 St. Paul teachers retirement plan 8.5 8.5 93.19Except for the legislators retirement plan and the constitutional officers calculation 93.20of total plan liabilities, the select preretirement interest rate assumption for the period 93.21after June 30, 2012, through June 30, 2017, is 8.0 percent. Except for the legislators 93.22retirement plan and the constitutional officers calculation of total plan liabilities, the select 93.23postretirement interest rate assumption for the period after June 30, 2012, through June 93.2430, 2017, is 5.5 percent, except for the Duluth teachers retirement plan and the St. Paul 93.25teachers retirement plan, each with a select postretirement interest rate assumption for the 93.26period after June 30, 2012, through June 30, 2017, of 8.0 percent. 93.27(2) single rate preretirement and postretirement interest rate assumption 93.28 93.29 plan interest rate assumption 93.30 Bloomington Fire Department Relief Association 6.0 93.31 93.32 local monthly benefit volunteer firefighters relief associations 5.0 93.33 new text begin (b)(1) If funding stability has been attained, the valuation must use a postretirement new text end 93.34 new text begin adjustment rate actuarial assumption equal to the postretirement adjustment rate specified new text end 93.35 new text begin in section 354A.27, subdivision 7; 354A.29, subdivision 9; or 356.415, subdivision 1, new text end 93.36 new text begin whichever applies. new text end 93.37 new text begin (2) If funding stability has not been attained, the valuation must use a select new text end 93.38 new text begin postretirement adjustment rate actuarial assumption equal to the postretirement adjustment new text end 93.39 new text begin rate specified in section 354A.27, subdivision 6a; 354A.29, subdivision 8; or 356.415, new text end 93.40 new text begin subdivisions 1a, 1b, 1c, 1d, 1e, or 1f, whichever applies, for a period ending when the new text end 93.41 new text begin approved actuary projects that the plan will attain the defined funding stability measure, new text end 94.1 new text begin and thereafter the valuation must use an ultimate postretirement adjustment rate actuarial new text end 94.2 new text begin assumption equal to the postretirement adjustment rate under section 354A.27, subdivision new text end 94.3 new text begin 7; 354A.29, subdivision 9; or 356.415, subdivision 1, for the applicable period or periods new text end 94.4 new text begin beginning when funding stability is projected to be attained. For actuarial valuations new text end 94.5 new text begin prepared after June 29, 2015, the projection under this clause must use the same actuarial new text end 94.6 new text begin assumptions as used in the actuarial valuation and must include the impact of any new text end 94.7 new text begin retirement contribution change under section 352.045, 353.27, subdivision 3b, or 354.42, new text end 94.8 new text begin subdivisions 4a, 4b, 4c, and 4d, whichever applies. For actuarial valuations prepared after new text end 94.9 new text begin June 29, 2015, if the attainment of the defined funding stability measure is projected to be new text end 94.10 new text begin later than the amortization target date applicable to the retirement plan in subdivision 11, the new text end 94.11 new text begin actuarial valuation must include an exhibit setting forth the annual results, for a period of new text end 94.12 new text begin at least 30 years from the valuation date, of the expected experience of the retirement plan new text end 94.13 new text begin under its actuarial assumptions, the expected funded condition, the expected total financial new text end 94.14 new text begin requirements, and the expected financial support on which that conclusion is based. new text end 94.15    (b) new text begin (c) new text end The actuarial valuation must use the applicable following single rate future 94.16salary increase assumption, the applicable following modified single rate future salary 94.17increase assumption, or the applicable following graded rate future salary increase 94.18assumption: 94.19    (1) single rate future salary increase assumption 94.20 plan future salary increase assumption 94.21 legislators retirement plan 5.0% 94.22 judges retirement plan 3.0 94.23 94.24 Bloomington Fire Department Relief Association 4.0 94.25    (2) age-related future salary increase age-related select and ultimate future salary 94.26increase assumption or graded rate future salary increase assumption 94.27 plan future salary increase assumption 94.28 local government correctional service retirement plan assumption C 94.29 Duluth teachers retirement plan assumption A 94.30 St. Paul teachers retirement plan assumption B 94.31For plans other than the Duluth teachers 94.32retirement plan, the select calculation 94.33is: during the designated select period, a 94.34designated percentage rate is multiplied by 94.35the result of the designated integer minus T, 94.36where T is the number of completed years 94.37of service, and is added to the applicable 95.1future salary increase assumption. The 95.2designated select period is ten years and 95.3the designated integer is ten for the Duluth 95.4Teachers Retirement Fund Association 95.5and for the local government correctional 95.6service retirement plan and 15 for the St. 95.7Paul Teachers Retirement Fund Association. 95.8The designated percentage rate is 0.2 95.9percent for the St. Paul Teachers Retirement 95.10Fund Association. The select calculation 95.11for the Duluth Teachers Retirement Fund 95.12Association is 8.00 percent per year for 95.13service years one through seven, 7.25 percent 95.14per year for service years seven and eight, 95.15and 6.50 percent per year for service years 95.16eight and nine. 95.17    The ultimate future salary increase assumption is: 95.18 age A B C 95.19 16 6.00% 5.90% 9.00% 95.20 17 6.00 5.90 9.00 95.21 18 6.00 5.90 9.00 95.22 19 6.00 5.90 9.00 95.23 20 6.00 5.90 9.00 95.24 21 6.00 5.90 8.75 95.25 22 6.00 5.90 8.50 95.26 23 6.00 5.85 8.25 95.27 24 6.00 5.80 8.00 95.28 25 6.00 5.75 7.75 95.29 26 6.00 5.70 7.50 95.30 27 6.00 5.65 7.25 95.31 28 6.00 5.60 7.00 95.32 29 6.00 5.55 6.75 95.33 30 6.00 5.50 6.75 95.34 31 6.00 5.45 6.50 95.35 32 6.00 5.40 6.50 95.36 33 6.00 5.35 6.50 95.37 34 6.00 5.30 6.25 95.38 35 6.00 5.25 6.25 95.39 36 5.86 5.20 6.00 95.40 37 5.73 5.15 6.00 96.1 38 5.59 5.10 6.00 96.2 39 5.45 5.05 5.75 96.3 40 5.31 5.00 5.75 96.4 41 5.18 4.95 5.75 96.5 42 5.04 4.90 5.50 96.6 43 4.90 4.85 5.25 96.7 44 4.76 4.80 5.25 96.8 45 4.63 4.75 5.00 96.9 46 4.49 4.70 5.00 96.10 47 4.35 4.65 5.00 96.11 48 4.21 4.60 5.00 96.12 49 4.08 4.55 5.00 96.13 50 3.94 4.50 5.00 96.14 51 3.80 4.45 5.00 96.15 52 3.66 4.40 5.00 96.16 53 3.53 4.35 5.00 96.17 54 3.39 4.30 5.00 96.18 55 3.25 4.25 4.75 96.19 56 3.25 4.20 4.75 96.20 57 3.25 4.15 4.50 96.21 58 3.25 4.10 4.25 96.22 59 3.25 4.05 4.25 96.23 60 3.25 4.00 4.25 96.24 61 3.25 4.00 4.25 96.25 62 3.25 4.00 4.25 96.26 63 3.25 4.00 4.25 96.27 64 3.25 4.00 4.25 96.28 65 3.25 4.00 4.00 96.29 66 3.25 4.00 4.00 96.30 67 3.25 4.00 4.00 96.31 68 3.25 4.00 4.00 96.32 69 3.25 4.00 4.00 96.33 70 3.25 4.00 4.00 96.34(3) service-related ultimate future salary increase assumption 96.35 96.36 general state employees retirement plan of the Minnesota State Retirement System assumption A 96.37 96.38 general employees retirement plan of the Public Employees Retirement Association assumption B 96.39 Teachers Retirement Association assumption C 96.40 public employees police and fire retirement plan assumption D 96.41 State Patrol retirement plan assumption E 96.42 96.43 correctional state employees retirement plan of the Minnesota State Retirement System assumption F 97.1 97.2 service length A B C D E F 97.3 1 10.50% 12.03% 12.00% 13.00% 8.00% 6.00% 97.4 2 8.10 8.90 9.00 11.00 7.50 5.85 97.5 3 6.90 7.46 8.00 9.00 7.00 5.70 97.6 4 6.20 6.58 7.50 8.00 6.75 5.55 97.7 5 5.70 5.97 7.25 6.50 6.50 5.40 97.8 6 5.30 5.52 7.00 6.10 6.25 5.25 97.9 7 5.00 5.16 6.85 5.80 6.00 5.10 97.10 8 4.70 4.87 6.70 5.60 5.85 4.95 97.11 9 4.50 4.63 6.55 5.40 5.70 4.80 97.12 10 4.40 4.42 6.40 5.30 5.55 4.65 97.13 11 4.20 4.24 6.25 5.20 5.40 4.55 97.14 12 4.10 4.08 6.00 5.10 5.25 4.45 97.15 13 4.00 3.94 5.75 5.00 5.10 4.35 97.16 14 3.80 3.82 5.50 4.90 4.95 4.25 97.17 15 3.70 3.70 5.25 4.80 4.80 4.15 97.18 16 3.60 3.60 5.00 4.80 4.65 4.05 97.19 17 3.50 3.51 4.75 4.80 4.50 3.95 97.20 18 3.50 3.50 4.50 4.80 4.35 3.85 97.21 19 3.50 3.50 4.25 4.80 4.20 3.75 97.22 20 3.50 3.50 4.00 4.80 4.05 3.75 97.23 21 3.50 3.50 3.90 4.70 4.00 3.75 97.24 22 3.50 3.50 3.80 4.60 4.00 3.75 97.25 23 3.50 3.50 3.70 4.50 4.00 3.75 97.26 24 3.50 3.50 3.60 4.50 4.00 3.75 97.27 25 3.50 3.50 3.50 4.50 4.00 3.75 97.28 26 3.50 3.50 3.50 4.50 4.00 3.75 97.29 27 3.50 3.50 3.50 4.50 4.00 3.75 97.30 28 3.50 3.50 3.50 4.50 4.00 3.75 97.31 29 3.50 3.50 3.50 4.50 4.00 3.75 97.32 30 or more 3.50 3.50 3.50 4.50 4.00 3.75 97.33    (c) new text begin (d) new text end The actuarial valuation must use the applicable following payroll growth 97.34assumption for calculating the amortization requirement for the unfunded actuarial 97.35accrued liability where the amortization retirement is calculated as a level percentage 97.36of an increasing payroll: 97.37 plan payroll growth assumption 97.38 97.39 general state employees retirement plan of the Minnesota State Retirement System 3.75% 97.40 correctional state employees retirement plan 3.75 97.41 State Patrol retirement plan 3.75 97.42 judges retirement plan 3.00 98.1 98.2 general employees retirement plan of the Public Employees Retirement Association 3.75 98.3 public employees police and fire retirement plan 3.75 98.4 local government correctional service retirement plan 3.75 98.5 teachers retirement plan 3.75 98.6 Duluth teachers retirement plan 3.50 98.7 St. Paul teachers retirement plan 4.00 98.8    (d) new text begin (e) new text end The assumptions set forth in paragraphs (b) new text begin (c) new text end and (c) new text begin (d) new text end continue to apply, 98.9unless a different salary assumption or a different payroll increase assumption: 98.10    (1) has been proposed by the governing board of the applicable retirement plan; 98.11    (2) is accompanied by the concurring recommendation of the actuary retained under 98.12section 356.214, subdivision 1, if applicable, or by the approved actuary preparing the 98.13most recent actuarial valuation report if section 356.214 does not apply; and 98.14    (3) has been approved or deemed approved under subdivision 18. 98.15 new text begin EFFECTIVE DATE. new text end new text begin This section is effective June 30, 2014, and applies to new text end 98.16 new text begin actuarial valuation reports prepared on or after that date. new text end 98.17    Sec. 2. Minnesota Statutes 2012, section 356.215, subdivision 11, is amended to read: 98.18    Subd. 11. Amortization contributions. (a) In addition to the exhibit indicating 98.19the level normal cost, the actuarial valuation of the retirement plan must contain an 98.20exhibit for financial reporting purposes indicating the additional annual contribution 98.21sufficient to amortize the unfunded actuarial accrued liability and must contain an exhibit 98.22for contribution determination purposes indicating the additional contribution sufficient 98.23to amortize the unfunded actuarial accrued liability. For the retirement plans listed in 98.24subdivision 8, paragraph (c), but excluding the MERF division of the Public Employees 98.25Retirement Association and the legislators retirement plan, the additional contribution 98.26must be calculated on a level percentage of covered payroll basis by the established date 98.27for full funding in effect when the valuation is prepared, assuming annual payroll growth 98.28at the applicable percentage rate set forth in subdivision 8, paragraph (c) new text begin (d) new text end . For all 98.29other retirement plans and for the MERF division of the Public Employees Retirement 98.30Association and the legislators retirement plan, the additional annual contribution must be 98.31calculated on a level annual dollar amount basis. 98.32    (b) For any retirement plan other than the general state employees retirement plan of 98.33the Minnesota State Retirement System or a retirement plan governed by paragraph (d), 98.34(e), (f), (g), (h), (i), or (j), new text begin or (k), new text end if there has not been a change in the actuarial assumptions 98.35used for calculating the actuarial accrued liability of the fund, a change in the benefit 98.36plan governing annuities and benefits payable from the fund, a change in the actuarial 99.1cost method used in calculating the actuarial accrued liability of all or a portion of the 99.2fund, or a combination of the three, which change or changes by itself or by themselves 99.3without inclusion of any other items of increase or decrease produce a net increase in the 99.4unfunded actuarial accrued liability of the fund, the established date for full funding is the 99.5first actuarial valuation date occurring after June 1, 2020. 99.6    (c) For any retirement plan other than the general employees retirement plan of the 99.7Public Employees Retirement Association, if there has been a change in any or all of the 99.8actuarial assumptions used for calculating the actuarial accrued liability of the fund, a 99.9change in the benefit plan governing annuities and benefits payable from the fund, a 99.10change in the actuarial cost method used in calculating the actuarial accrued liability of all 99.11or a portion of the fund, or a combination of the three, and the change or changes, by itself 99.12or by themselves and without inclusion of any other items of increase or decrease, produce 99.13a net increase in the unfunded actuarial accrued liability in the fund, the established date 99.14for full funding must be determined using the following procedure: 99.15    (i) the unfunded actuarial accrued liability of the fund must be determined in 99.16accordance with the plan provisions governing annuities and retirement benefits and the 99.17actuarial assumptions in effect before an applicable change; 99.18    (ii) the level annual dollar contribution or level percentage, whichever is applicable, 99.19needed to amortize the unfunded actuarial accrued liability amount determined under item 99.20(i) by the established date for full funding in effect before the change must be calculated 99.21using the interest assumption specified in subdivision 8 in effect before the change; 99.22    (iii) the unfunded actuarial accrued liability of the fund must be determined in 99.23accordance with any new plan provisions governing annuities and benefits payable from 99.24the fund and any new actuarial assumptions and the remaining plan provisions governing 99.25annuities and benefits payable from the fund and actuarial assumptions in effect before 99.26the change; 99.27    (iv) the level annual dollar contribution or level percentage, whichever is applicable, 99.28needed to amortize the difference between the unfunded actuarial accrued liability amount 99.29calculated under item (i) and the unfunded actuarial accrued liability amount calculated 99.30under item (iii) over a period of 30 years from the end of the plan year in which the 99.31applicable change is effective must be calculated using the applicable interest assumption 99.32specified in subdivision 8 in effect after any applicable change; 99.33    (v) the level annual dollar or level percentage amortization contribution under item 99.34(iv) must be added to the level annual dollar amortization contribution or level percentage 99.35calculated under item (ii); 100.1    (vi) the period in which the unfunded actuarial accrued liability amount determined 100.2in item (iii) is amortized by the total level annual dollar or level percentage amortization 100.3contribution computed under item (v) must be calculated using the interest assumption 100.4specified in subdivision 8 in effect after any applicable change, rounded to the nearest 100.5integral number of years, but not to exceed 30 years from the end of the plan year in which 100.6the determination of the established date for full funding using the procedure set forth in this 100.7clause is made and not to be less than the period of years beginning in the plan year in which 100.8the determination of the established date for full funding using the procedure set forth in 100.9this clause is made and ending by the date for full funding in effect before the change; and 100.10    (vii) the period determined under item (vi) must be added to the date as of which 100.11the actuarial valuation was prepared and the date obtained is the new established date 100.12for full funding. 100.13    (d) For the MERF division of the Public Employees Retirement Association, the 100.14established date for full funding is June 30, 2031. 100.15    (e) For the general employees retirement plan of the Public Employees Retirement 100.16Association, the established date for full funding is June 30, 2031. 100.17    (f) For the Teachers Retirement Association, the established date for full funding is 100.18June 30, 2037. 100.19    (g) For the correctional state employees retirement plan of the Minnesota State 100.20Retirement System, the established date for full funding is June 30, 2038. 100.21    (h) For the judges retirement plan, the established date for full funding is June 100.2230, 2038. 100.23    (i) For the public employees police and fire retirement plan, the established date 100.24for full funding is June 30, 2038. 100.25    (j) For the St. Paul Teachers Retirement Fund Association, the established date for 100.26full funding is June 30 of the 25th year from the valuation date. In addition to other 100.27requirements of this chapter, the annual actuarial valuation must contain an exhibit 100.28indicating the funded ratio and the deficiency or sufficiency in annual contributions when 100.29comparing liabilities to the market value of the assets of the fund as of the close of the 100.30most recent fiscal year. 100.31(k) For the general state employees retirement plan of the Minnesota State 100.32Retirement System, the established date for full funding is June 30, 2040. 100.33    (l) For the retirement plans for which the annual actuarial valuation indicates an 100.34excess of valuation assets over the actuarial accrued liability, the valuation assets in 100.35excess of the actuarial accrued liability must be recognized as a reduction in the current 100.36contribution requirements by an amount equal to the amortization of the excess expressed 101.1as a level percentage of pay over a 30-year period beginning anew with each annual 101.2actuarial valuation of the plan. 101.3 new text begin EFFECTIVE DATE. new text end new text begin This section is effective July 1, 2014, and applies to actuarial new text end 101.4 new text begin valuation results prepared on or after that date. new text end 101.5    Sec. 3. new text begin REPEALER. new text end 101.6 new text begin Minnesota Statutes 2012, section 356.415, subdivision 3, new text end new text begin is repealed. new text end 101.7 new text begin EFFECTIVE DATE. new text end new text begin This section is effective June 30, 2014, and applies to new text end 101.8 new text begin actuarial valuation reports prepared on or after that date. new text end 101.9ARTICLE 11 101.10POSTRETIREMENT ADJUSTMENT TRIGGER PROCEDURES 101.11    Section 1. Minnesota Statutes 2013 Supplement, section 354A.27, subdivision 6a, 101.12is amended to read: 101.13    Subd. 6a. Postretirement adjustment transition. (a) If the funded ratio of the 101.14retirement plan based on the actuarial value of assets is at least 90 percent as reported in 101.15the new text begin two new text end most recent actuarial valuation new text begin valuations new text end prepared under sections 356.214 and 101.16356.215 , this subdivision expires and subsequent postretirement adjustments are governed 101.17by subdivision 7. 101.18(b) Each annuity or benefit recipient of the retirement plan who has been receiving 101.19that annuity or benefit for at least 12 months as of the applicable January 1 is eligible to 101.20receive a postretirement adjustment of one percent, payable on January 1. 101.21 new text begin EFFECTIVE DATE. new text end new text begin This section is effective July 1, 2015, unless Minnesota new text end 101.22 new text begin Statutes, section 354A.27, subdivision 6a, is repealed by action of the 2014 legislature. new text end 101.23    Sec. 2. Minnesota Statutes 2012, section 354A.29, subdivision 8, is amended to read: 101.24    Subd. 8. Calculation of postretirement adjustments; transitional provision. (a) 101.25For purposes of computing postretirement adjustments for eligible benefit recipients of 101.26the St. Paul Teachers Retirement Fund Association, the accrued liability funding ratio 101.27based on the actuarial value of assets of the plan as determined by the new text begin two new text end most recent 101.28actuarial valuation new text begin valuations new text end prepared under sections 356.214 and 356.215 determines 101.29the postretirement increase, as follows: 102.1 Funding ratio Postretirement increase 102.2 Less than 80 percent 1 percent 102.3 102.4 At least 80 percent but less than90 percent 2 percent 102.5(b) The amount determined under paragraph (a) is the full postretirement increase 102.6to be applied as a permanent increase to the regular payment of each eligible member 102.7on January 1 of the next calendar year. For any eligible member whose effective date 102.8of benefit commencement occurred during the calendar year before the postretirement 102.9increase is applied, the full increase amount must be prorated on the basis of whole 102.10calendar quarters in benefit payment status in the calendar year prior to the January 1 on 102.11which the postretirement increase is applied, calculated to the third decimal place. 102.12(c) If the accrued liability funding ratio based on the actuarial value of assets is at 102.13least 90 percent new text begin in two consecutive actuarial valuations new text end , this subdivision expires and 102.14subsequent postretirement increases must be paid as specified in subdivision 9. 102.15 new text begin EFFECTIVE DATE. new text end new text begin This section is effective July 1, 2015. new text end 102.16    Sec. 3. Minnesota Statutes 2013 Supplement, section 356.415, subdivision 1a, is 102.17amended to read: 102.18    Subd. 1a. Annual postretirement adjustments; Minnesota State Retirement 102.19System plans other than State Patrol retirement plan. (a) Retirement annuity, disability 102.20benefit, or survivor benefit recipients of the legislators retirement plans, including 102.21constitutional officers as specified in chapter 3A, the general state employees retirement 102.22plan, the correctional state employees retirement plan, the unclassified state employees 102.23retirement program, and the judges retirement plan are entitled to a postretirement 102.24adjustment annually on January 1, as follows: 102.25(1) a postretirement increase of two percent must be applied each year, effective 102.26on January 1, to the monthly annuity or benefit of each annuitant or benefit recipient 102.27who has been receiving an annuity or a benefit for at least 18 full months before the 102.28January 1 increase; and 102.29(2) for each annuitant or benefit recipient who has been receiving an annuity or 102.30a benefit for at least six full months, an annual postretirement increase of 1/12 of two 102.31percent for each month that the person has been receiving an annuity or benefit must be 102.32applied, effective January 1, following the calendar year in which the person has been 102.33retired for at least six months, but has been retired for less than 18 months. 102.34(b) The increases provided by this subdivision commence on January 1, 2011. 102.35Increases under this subdivision for the general state employees retirement plan, the 103.1correctional state employees retirement plan, or the judges retirement plan terminate on 103.2December 31 of the calendar year in which the new text begin two prior consecutive new text end actuarial valuation 103.3 new text begin valuations new text end prepared by the approved actuary under sections 356.214 and 356.215 and the 103.4standards for actuarial work promulgated by the Legislative Commission on Pensions 103.5and Retirement indicates that the market value of assets of the retirement plan equals or 103.6exceeds 90 percent of the actuarial accrued liability of the retirement plan and increases 103.7under subdivision 1 recommence after that date. Increases under this subdivision for 103.8the legislators retirement plan or the elected state officers retirement plan terminate 103.9on December 31 of the calendar year in which the actuarial valuation prepared by the 103.10approved actuary under sections 356.214 and 356.215 and the standards for actuarial work 103.11promulgated by the Legislative Commission on Pensions and Retirement indicates that the 103.12market value of assets of the general state employees retirement plan equals or exceeds 103.1390 percent of the actuarial accrued liability of the retirement plan and increases under 103.14subdivision 1 recommence after that date. 103.15(c) An increase in annuity or benefit payments under this subdivision must be made 103.16automatically unless written notice is filed by the annuitant or benefit recipient with the 103.17executive director of the applicable covered retirement plan requesting that the increase 103.18not be made. 103.19 new text begin EFFECTIVE DATE. new text end new text begin This section is effective July 1, 2014. new text end 103.20    Sec. 4. Minnesota Statutes 2012, section 356.415, subdivision 1d, is amended to read: 103.21    Subd. 1d. Teachers Retirement Association annual postretirement adjustments. 103.22(a) Retirement annuity, disability benefit, or survivor benefit recipients of the Teachers 103.23Retirement Association are entitled to a postretirement adjustment annually on January 103.241, as follows: 103.25(1) for January 1, 2011, and January 1, 2012, no postretirement increase is payable; 103.26(2) for January 1, 2013, and each successive January 1 until funding stability is 103.27restored, a postretirement increase of two percent must be applied each year, effective 103.28on January 1, to the monthly annuity or benefit amount of each annuitant or benefit 103.29recipient who has been receiving an annuity or a benefit for at least 18 full months prior 103.30to the January 1 increase; 103.31(3) for January 1, 2013, and each successive January 1 until funding stability is 103.32restored, for each annuitant or benefit recipient who has been receiving an annuity or a 103.33benefit for at least six full months before the January 1 increase, an annual postretirement 103.34increase of 1/12 of two percent for each month the person has been receiving an annuity or 104.1benefit must be applied, effective January 1, for which the person has been retired for at 104.2least six months but less than 18 months; 104.3(4) for each January 1 following the restoration of funding stability, a postretirement 104.4increase of 2.5 percent must be applied each year, effective January 1, to the monthly 104.5annuity or benefit amount of each annuitant or benefit recipient who has been receiving an 104.6annuity or a benefit for at least 18 full months prior to the January 1 increase; and 104.7(5) for each January 1 following the restoration of funding stability, for each 104.8annuitant or benefit recipient who has been receiving an annuity or a benefit for at least 104.9six full months before the January 1 increase, an annual postretirement increase of 1/12 104.10of 2.5 percent for each month the person has been receiving an annuity or benefit must 104.11be applied, effective January 1, for which the person has been retired for at least six 104.12months but less than 18 months. 104.13(b) Funding stability is restored when the market value of assets of the Teachers 104.14Retirement Association equals or exceeds 90 percent of the actuarial accrued liabilities 104.15of the Teachers Retirement Association in the new text begin two new text end most recent prior actuarial valuation 104.16 new text begin valuations new text end prepared under section 356.215 and the standards for actuarial work by the 104.17approved actuary retained by the Teachers Retirement Association under section 356.214. 104.18(c) An increase in annuity or benefit payments under this section must be made 104.19automatically unless written notice is filed by the annuitant or benefit recipient with the 104.20executive director of the Teachers Retirement Association requesting that the increase 104.21not be made. 104.22(d) The retirement annuity payable to a person who retires before becoming eligible 104.23for Social Security benefits and who has elected the optional payment as provided in 104.24section 354.35 must be treated as the sum of a period-certain retirement annuity and a life 104.25retirement annuity for the purposes of any postretirement adjustment. The period-certain 104.26retirement annuity plus the life retirement annuity must be the annuity amount payable 104.27until age 62, 65, or normal retirement age, as selected by the member at retirement, for an 104.28annuity amount payable under section 354.35. A postretirement adjustment granted on 104.29the period-certain retirement annuity must terminate when the period-certain retirement 104.30annuity terminates. 104.31 new text begin EFFECTIVE DATE. new text end new text begin This section is effective July 1, 2015. new text end 104.32    Sec. 5. Minnesota Statutes 2013 Supplement, section 356.415, subdivision 1e, is 104.33amended to read: 104.34    Subd. 1e. Annual postretirement adjustments; State Patrol retirement plan. 104.35(a) Retirement annuity, disability benefit, or survivor benefit recipients of the State Patrol 105.1retirement plan are entitled to a postretirement adjustment annually on January 1, as 105.2follows: 105.3(1) a postretirement increase of one percent must be applied each year, effective on 105.4January 1, to the monthly annuity or benefit of each annuitant or benefit recipient who 105.5has been receiving an annuity or a benefit for at least 18 full months before the January 1 105.6increase; and 105.7(2) for each annuitant or benefit recipient who has been receiving an annuity or a 105.8benefit for at least six full months, an annual postretirement increase of 1/12 of one percent 105.9for each month that the person has been receiving an annuity or benefit must be applied, 105.10effective January 1, following the calendar year in which the person has been retired for at 105.11least six months, but has been retired for less than 18 months. 105.12(b) The increases provided by this subdivision commence on January 1, 2014. 105.13Increases under paragraph (a) for the State Patrol retirement plan terminate on December 105.1431 of the calendar year in which the new text begin two prior consecutive new text end actuarial valuation new text begin valuations new text end 105.15prepared by the approved actuary under sections 356.214 and 356.215 and the standards 105.16for actuarial work promulgated by the Legislative Commission on Pensions and 105.17Retirement indicates that the market value of assets of the retirement plan equals or 105.18exceeds 85 percent of the actuarial accrued liability of the retirement plan and increases 105.19under paragraph (c) recommence after that date. 105.20(c) Retirement annuity, disability benefit, or survivor benefit recipients of the State 105.21Patrol retirement plan are entitled to a postretirement adjustment annually on January 105.221, as follows: 105.23(1) a postretirement increase of 1.5 percent must be applied each year, effective on 105.24January 1, to the monthly annuity or benefit of each annuitant or benefit recipient who 105.25has been receiving an annuity or a benefit for at least 18 full months before the January 1 105.26increase; and 105.27(2) for each annuitant or benefit recipient who has been receiving an annuity or a 105.28benefit for at least six full months, an annual postretirement increase of 1/12 of 1.5 percent 105.29for each month that the person has been receiving an annuity or benefit must be applied, 105.30effective January 1, following the calendar year in which the person has been retired for at 105.31least six months, but has been retired for less than 18 months. 105.32(d) Increases under paragraph (c) for the State Patrol retirement plan terminate on 105.33December 31 of the calendar year in which the new text begin two prior consecutive new text end actuarial valuation 105.34 new text begin valuations new text end prepared by the approved actuary under sections 356.214 and 356.215 and 105.35the standards for actuarial work adopted by the Legislative Commission on Pensions 105.36and Retirement indicates that the market value of assets of the retirement plan equals or 106.1exceeds 90 percent of the actuarial accrued liability of the retirement plan and increases 106.2under subdivision 1 recommence after that date. 106.3(e) An increase in annuity or benefit payments under this subdivision must be made 106.4automatically unless written notice is filed by the annuitant or benefit recipient with the 106.5executive director of the applicable covered retirement plan requesting that the increase 106.6not be made. 106.7 new text begin EFFECTIVE DATE. new text end new text begin This section is effective July 1, 2014. new text end 106.8    Sec. 6. Minnesota Statutes 2013 Supplement, section 356.415, subdivision 1f, is 106.9amended to read: 106.10    Subd. 1f. Annual postretirement adjustments; Minnesota State Retirement 106.11System judges retirement plan. (a) The increases provided under this subdivision begin 106.12on January 1, 2014, and are in lieu of increases under subdivision 1 or 1a for retirement 106.13annuity, disability benefit, or survivor benefit recipients of the judges retirement plan. 106.14(b) Retirement annuity, disability benefit, or survivor benefit recipients of the 106.15judges retirement plan are entitled to a postretirement adjustment annually on January 106.161, as follows: 106.17(1) a postretirement increase of 1.75 percent must be applied each year, effective 106.18on January 1, to the monthly annuity or benefit of each annuitant or benefit recipient 106.19who has been receiving an annuity or a benefit for at least 18 full months before the 106.20January 1 increase; and 106.21(2) for each annuitant or benefit recipient who has been receiving an annuity or a 106.22benefit for at least six full months, an annual postretirement increase of 1/12 of 1.75 106.23percent for each month that the person has been receiving an annuity or benefit must be 106.24applied, effective January 1, following the calendar year in which the person has been 106.25retired for at least six months, but has been retired for less than 18 months. 106.26(c) Increases under this subdivision terminate on December 31 of the calendar 106.27year in which the new text begin two prior consecutive new text end actuarial valuation new text begin valuations new text end prepared by the 106.28approved actuary under sections 356.214 and 356.215 and the standards for actuarial work 106.29promulgated by the Legislative Commission on Pensions and Retirement indicates that 106.30the market value of assets of the judges retirement plan equals or exceeds 70 percent of 106.31the actuarial accrued liability of the retirement plan. Increases under subdivision 1 or 1a, 106.32whichever is applicable, begin on the January 1 next following that date. 106.33(d) An increase in annuity or benefit payments under this subdivision must be made 106.34automatically unless written notice is filed by the annuitant or benefit recipient with the 107.1executive director of the applicable covered retirement plan requesting that the increase 107.2not be made. 107.3 new text begin EFFECTIVE DATE. new text end new text begin This section is effective July 1, 2014. new text end 107.4ARTICLE 12 107.5VOLUNTEER FIREFIGHTER RELIEF ASSOCIATION CHANGES 107.6    Section 1. Minnesota Statutes 2013 Supplement, section 69.051, subdivision 1a, 107.7is amended to read: 107.8    Subd. 1a. Financial statement. (a) The board of each volunteer firefighters relief 107.9association, as defined in section 424A.001, subdivision 4, that is not required to file a 107.10financial report and audit under subdivision 1 must prepare a detailed statement of the 107.11financial affairs for the preceding fiscal year of the relief association's special and general 107.12funds in the style and form prescribed by the state auditor. The detailed statement must 107.13show: 107.14(1) the sources and amounts of all money received; 107.15(2) all disbursements, accounts payable and accounts receivable; 107.16(3) the amount of money remaining in the treasury; 107.17(4) total assets, including a listing of all investments; 107.18(5) the accrued liabilities; and 107.19(6) all other items necessary to show accurately the revenues and expenditures and 107.20financial position of the relief association. 107.21(b) The detailed financial statement required under paragraph (a) must be certified 107.22by an independent new text begin a certified new text end public accountant or new text begin by the state new text end auditor or by the auditor or 107.23accountant who regularly examines or audits the financial transactions of the municipality. 107.24In addition to certifying the financial condition of the special and general funds of the relief 107.25association, the accountant or auditor conducting the examination shall give an opinion 107.26as to the condition of the special and general funds of the relief association, and shall 107.27comment upon any exceptions to the report. The independent accountant or auditor must 107.28have at least five years of public accounting, auditing, or similar experience, and must not 107.29be an active, inactive, or retired member of the relief association or the fire department. 107.30(c) The detailed statement required under paragraph (a) must be countersigned by: 107.31(1) the municipal clerk or clerk-treasurer of the municipality; or 107.32(2) where applicable, by the municipal clerk or clerk-treasurer of the largest 107.33municipality in population which contracts with the independent nonprofit firefighting 108.1corporation if the relief association is a subsidiary of an independent nonprofit firefighting 108.2corporation and by the secretary of the independent nonprofit firefighting corporation; or 108.3(3) by the chief financial official of the county in which the volunteer firefighter 108.4relief association is located or primarily located if the relief association is associated with 108.5a fire department that is not located in or associated with an organized municipality. 108.6(d) The volunteer firefighters' relief association board must file the detailed statement 108.7required under paragraph (a) in the relief association office for public inspection and 108.8present it to the governing body of the municipality within 45 days after the close of the 108.9fiscal year, and must submit a copy of the detailed statement to the state auditor within 90 108.10days of the close of the fiscal year. 108.11 new text begin EFFECTIVE DATE. new text end new text begin This section is effective the day following final enactment. new text end 108.12    Sec. 2. Minnesota Statutes 2013 Supplement, section 69.051, subdivision 3, is 108.13amended to read: 108.14    Subd. 3. Report by certain municipalities new text begin ; exceptions new text end . (a) The chief 108.15administrative officer of each municipality which has an organized fire department but 108.16which does not have a firefighters' relief association governed by section 69.77 or sections 108.17424A.091 to 424A.095 and which is not exempted under paragraph (b) new text begin or (c) new text end shall annually 108.18prepare a detailed financial report of the receipts and disbursements by the municipality 108.19for fire protection service during the preceding calendar year on a form prescribed by the 108.20state auditor. The financial report must contain any information which the state auditor 108.21deems necessary to disclose the sources of receipts and the purpose of disbursements for 108.22fire protection service. The financial report must be signed by the municipal clerk or 108.23clerk-treasurer of the municipality. The financial report must be filed by the municipal clerk 108.24or clerk-treasurer with the state auditor on or before July 1 annually. The municipality does 108.25not qualify initially to receive, and is not entitled subsequently to retain, state aid under 108.26this chapter if the financial reporting requirement or the applicable requirements of this 108.27chapter or any other statute or special law have not been complied with or are not fulfilled. 108.28(b) Each municipality that has an organized fire department and provides retirement 108.29coverage to its firefighters through the voluntary statewide lump-sum volunteer firefighter 108.30retirement plan under chapter 353G qualifies to have fire state aid transmitted to and 108.31retained in the statewide lump-sum volunteer firefighter retirement fund without filing 108.32a detailed financial report if the executive director of the Public Employees Retirement 108.33Association certifies compliance by the municipality with the requirements of sections 108.34353G.04 and 353G.08, paragraph (e), and certifies conformity by the applicable fire chief 108.35with the requirements of section 353G.07. 109.1 new text begin (c) Each municipality qualifies to receive fire state aid under this chapter without new text end 109.2 new text begin filing a financial report under paragraph (a) if the municipality: new text end 109.3 new text begin (1) has an organized fire department; new text end 109.4 new text begin (2) does not have a volunteer firefighters relief association directly associated with new text end 109.5 new text begin its fire department; new text end 109.6 new text begin (3) does not participate in the statewide lump-sum volunteer firefighter retirement new text end 109.7 new text begin plan under chapter 353G; new text end 109.8 new text begin (4) provides retirement coverage to its firefighters through the public employees new text end 109.9 new text begin police and fire retirement plan under sections 353.63 to 353.68; and new text end 109.10 new text begin (5) is certified by the executive director of the Public Employees Retirement new text end 109.11 new text begin Association to the state auditor to have had an employer contribution under section new text end 109.12 new text begin 353.65, subdivision 3, for its firefighters for the immediately prior calendar year equal to new text end 109.13 new text begin or greater than its fire state aid for the immediately prior calendar year. new text end 109.14 new text begin EFFECTIVE DATE. new text end new text begin This section is effective the day following final enactment new text end 109.15 new text begin and applies to fire state aid payable on October 1, 2014. new text end 109.16    Sec. 3. Minnesota Statutes 2012, section 356A.06, subdivision 7, is amended to read: 109.17    Subd. 7. Expanded list of authorized investment securities. (a) Authority. A 109.18covered pension plan not described by subdivision 6, paragraph (a), is an expanded list 109.19plan and shall invest its assets as specified in this subdivision. The governing board of an 109.20expanded list plan may select and appoint investment agencies to act for or on its behalf. 109.21    (b) Securities generally; investment forms. An expanded list plan is authorized 109.22to purchase, sell, lend, and exchange the investment securities authorized under this 109.23subdivision, including puts and call options and future contracts traded on a contract 109.24market regulated by a governmental agency or by a financial institution regulated by 109.25a governmental agency. These securities may be owned directly or through shares 109.26in exchange-traded or mutual funds, or as units in commingled trusts, subject to any 109.27limitations specified in this subdivision. 109.28    (c) Government obligations. An expanded list plan is authorized to invest funds in 109.29governmental bonds, notes, bills, mortgages, and other evidences of indebtedness if the 109.30issue is backed by the full faith and credit of the issuer or the issue is rated among the top 109.31four quality rating categories by a nationally recognized rating agency. The obligations in 109.32which funds may be invested under this paragraph are guaranteed or insured issues of: 109.33(1) the United States, one of its agencies, one of its instrumentalities, or an 109.34organization created and regulated by an act of Congress; 110.1(2) the Dominion of Canada or one of its provinces if the principal and interest are 110.2payable in United States dollars; 110.3(3) a state or one of its municipalities, political subdivisions, agencies, or 110.4instrumentalities; and 110.5(4) a United States government-sponsored organization of which the United States is 110.6a member if the principal and interest are payable in United States dollars. 110.7    (d) Investment-grade corporate obligations. An expanded list plan is authorized 110.8to invest funds in bonds, notes, debentures, transportation equipment obligations, or 110.9any other longer term evidences of indebtedness issued or guaranteed by a corporation 110.10organized under the laws of the United States or any of its states, or the Dominion of 110.11Canada or any of its provinces if: 110.12    (1) the principal and interest are payable in United States dollars; and 110.13    (2) the obligations are rated among the top four quality categories by a nationally 110.14recognized rating agency. 110.15(e) Below-investment-grade corporate obligations. An expanded list plan is 110.16authorized to invest in unrated corporate obligations or in corporate obligations that are 110.17not rated among the top four quality categories by a nationally recognized rating agency if: 110.18(1) the aggregate value of these obligations does not exceed five percent of the 110.19covered pension plan's market value; 110.20(2) the covered pension plan's participation is limited to 50 percent of a single 110.21offering subject to this paragraph; and 110.22(3) the covered pension plan's participation is limited to 25 percent of an issuer's 110.23obligations subject to this paragraph. 110.24    (f) Other obligations. (1) An expanded list plan is authorized to invest funds in: 110.25    (i) bankers acceptances and deposit notes if issued by a United States bank that is 110.26rated in the highest four quality categories by a nationally recognized rating agency; 110.27    (ii) certificates of deposit if issued by a United States bank or savings institution 110.28rated in the highest four quality categories by a nationally recognized rating agency or 110.29whose certificates of deposit are fully insured by federal agencies, or if issued by a credit 110.30union in an amount within the limit of the insurance coverage provided by the National 110.31Credit Union Administration; 110.32    (iii) commercial paper if issued by a United States corporation or its Canadian 110.33subsidiary and if rated in the highest two quality categories by a nationally recognized 110.34rating agency; 110.35    (iv) mortgage securities and asset-backed securities if rated in the top four quality 110.36categories by a nationally recognized rating agency; 111.1    (v) repurchase agreements and reverse repurchase agreements if collateralized with 111.2letters of credit or securities authorized in this section; 111.3    (vi) guaranteed investment contracts if issued by an insurance company or a bank 111.4that is rated in the top four quality categories by a nationally recognized rating agency 111.5or alternative guaranteed investment contracts if the underlying assets comply with the 111.6requirements of this subdivision; 111.7    (vii) savings accounts if fully insured by a federal agency; and 111.8    (viii) guaranty fund certificates, surplus notes, or debentures if issued by a domestic 111.9mutual insurance company. 111.10    (2) Sections 16A.58, 16C.03, subdivision 4, and 16C.05 do not apply to certificates 111.11of deposit and collateralization agreements executed by the covered pension plan under 111.12clause (1), item (ii). 111.13    (3) In addition to investments authorized by clause (1), item (iv), an expanded list 111.14plan is authorized to purchase from the Minnesota Housing Finance Agency all or any part 111.15of a pool of residential mortgages, not in default, that has previously been financed by the 111.16issuance of bonds or notes of the agency. The covered pension plan may also enter into 111.17a commitment with the agency, at the time of any issue of bonds or notes, to purchase 111.18at a specified future date, not exceeding 12 years from the date of the issue, the amount 111.19of mortgage loans then outstanding and not in default that have been made or purchased 111.20from the proceeds of the bonds or notes. The covered pension plan may charge reasonable 111.21fees for any such commitment and may agree to purchase the mortgage loans at a price 111.22sufficient to produce a yield to the covered pension plan comparable, in its judgment, 111.23to the yield available on similar mortgage loans at the date of the bonds or notes. The 111.24covered pension plan may also enter into agreements with the agency for the investment 111.25of any portion of the funds of the agency. The agreement must cover the period of the 111.26investment, withdrawal privileges, and any guaranteed rate of return. 111.27    (g) Corporate stocks. An expanded list plan is authorized to invest in stocks or 111.28convertible issues of any corporation organized under the laws of the United States or any 111.29of its states, any corporation organized under the laws of the Dominion of Canada or any 111.30of its provinces, or any corporation listed on an exchange that is regulated by an agency of 111.31the United States or of the Canadian national government. 111.32    An investment in any corporation must not exceed five percent of the total 111.33outstanding shares of that corporation, except that an expanded list plan may hold up 111.34to 20 percent of the shares of a real estate investment trust and up to 20 percent of the 111.35shares of a closed mutual fund. 112.1    (h) Other investments. (1) In addition to the investments authorized in paragraphs 112.2(b) to (g), and subject to the provisions in clause (2), an expanded list plan is authorized 112.3to invest funds in: 112.4    (i) equity and debt investment businesses through participation in limited 112.5partnerships, trusts, private placements, limited liability corporations, limited liability 112.6companies, limited liability partnerships, and corporations; 112.7    (ii) real estate ownership interests or loans secured by mortgages or deeds of trust 112.8or shares of real estate investment trusts, through investment in limited partnerships, 112.9bank-sponsored collective funds, trusts, mortgage participation agreements, and insurance 112.10company commingled accounts, including separate accounts; 112.11    (iii) resource investments through limited partnerships, trusts, private placements, 112.12limited liability corporations, limited liability companies, limited liability partnerships, 112.13and corporations; and 112.14    (iv) international securities. 112.15    (2) The investments authorized in clause (1) must conform to the following 112.16provisions: 112.17    (i) the aggregate value of all investments made under clause (1), items (i), (ii), and 112.18(iii), may not exceed 35 percent of the market value of the fund for which the expanded 112.19list plan is investing; 112.20    (ii) there must be at least four unrelated owners of the investment other than the 112.21expanded list plan for investments made under clause (1), item (i), (ii), or (iii); 112.22    (iii) the expanded list plan's participation in an investment vehicle is limited to 20 112.23percent thereof for investments made under clause (1), item (i), (ii), or (iii); 112.24    (iv) the expanded list plan's participation in a limited partnership does not include a 112.25general partnership interest or other interest involving general liability. The expanded list 112.26plan may not engage in any activity as a limited partner which creates general liability; and 112.27(v) new text begin the aggregate value of all unrated obligations and obligations that are not rated new text end 112.28 new text begin among the top four quality categories by a nationally recognized rating agency authorized new text end 112.29 new text begin by paragraph (e) and clause (1), item (iv), must not exceed five percent of the covered new text end 112.30 new text begin plan's market value; and new text end 112.31 new text begin (vi) new text end for volunteer firefighter relief associations, emerging market equity and 112.32international debt investments authorized under clause (1), item (iv), must not exceed 15 112.33percent of the association's special fund market value. 112.34(i) Supplemental plan investments. The governing body of an expanded list plan 112.35may certify assets to the State Board of Investment for investment under section 11A.17. 113.1(j) Asset mix limitations. The aggregate value of an expanded list plan's 113.2investments under paragraphs (g) and (h) and equity investments under paragraph (i), 113.3regardless of the form in which these investments are held, must not exceed 85 percent of 113.4the covered plan's market value. 113.5 new text begin EFFECTIVE DATE. new text end new text begin This section is effective the day following final enactment. new text end 113.6    Sec. 4. Minnesota Statutes 2012, section 356A.06, subdivision 7a, is amended to read: 113.7    Subd. 7a. Restrictions. Any agreement to lend securities must be concurrently 113.8collateralized with cash or securities with a market value of not less than 100 percent of the 113.9market value of the loaned securities at the time of the agreement. For a covered pension 113.10authorized to purchase put and call options and futures contracts under subdivision 7, any 113.11agreement for put and call options and futures contracts may only be entered into with a 113.12fully offsetting amount of cash or securities. Only securities authorized by this section, 113.13excluding those under subdivision 7, paragraph (g) new text begin (h) new text end , clause (1), items (i) to (iv), may be 113.14accepted as collateral or offsetting securities. 113.15 new text begin EFFECTIVE DATE. new text end new text begin This section is effective the day following final enactment. new text end 113.16    Sec. 5. Minnesota Statutes 2012, section 424A.015, is amended by adding a 113.17subdivision to read: 113.18     new text begin Subd. 6. new text end new text begin Governing benefit plan provisions. new text end new text begin A service pension or ancillary benefit new text end 113.19 new text begin payable under this chapter is governed by and must be calculated under the general statute, new text end 113.20 new text begin special law, relief association articles of incorporation, and relief association bylaw new text end 113.21 new text begin provisions applicable on the date on which the member separated from active service with new text end 113.22 new text begin the fire department and active membership in the relief association. new text end 113.23 new text begin EFFECTIVE DATE. new text end new text begin This section is effective the day following final enactment. new text end 113.24    Sec. 6. Minnesota Statutes 2012, section 424A.016, subdivision 4, is amended to read: 113.25    Subd. 4. Individual accounts. (a) An individual account must be established for 113.26each firefighter who is a member of the relief association. 113.27(b) To each individual active member account must be credited an equal share of: 113.28(1) any amounts of fire state aid received by the relief association; 113.29(2) any amounts of municipal contributions to the relief association raised from 113.30levies on real estate or from other available municipal revenue sources exclusive of fire 113.31state aid; and 113.32(3) any amounts equal to the share of the assets of the special fund to the credit of: 114.1(i) any former member who terminated active service with the fire department to 114.2which the relief association is associated before meeting the minimum service requirement 114.3provided for in subdivision 2, paragraph (b), and has not returned to active service with 114.4the fire department for a period no shorter than five years; or 114.5(ii) any retired member who retired before obtaining a full nonforfeitable interest in 114.6the amounts credited to the individual member account under subdivision 2, paragraph 114.7(b), and any applicable provision of the bylaws of the relief association. In addition, any 114.8investment return on the assets of the special fund must be credited in proportion to the 114.9share of the assets of the special fund to the credit of each individual active member 114.10account. Administrative expenses of the relief association payable from the special 114.11fund may be deducted from individual accounts in a manner specified in the bylaws of 114.12the relief association. 114.13(c) If the bylaws so permit and as the bylaws define, the relief association may credit 114.14any investment return on the assets of the special fund to the accounts of inactive members. 114.15(d) Amounts to be credited to individual accounts must be allocated uniformly 114.16for all years of active service and allocations must be made for all years of service, 114.17except for caps on service credit if so provided in the bylaws of the relief association. 114.18 new text begin Amounts forfeited under paragraph (b), clause (3), before a resumption of active service new text end 114.19 new text begin and membership under section 424A.01, subdivision 6, remain forfeited and may not be new text end 114.20 new text begin reinstated upon the resumption of active service and membership. new text end The allocation method 114.21may utilize monthly proration for fractional years of service, as the bylaws or articles of 114.22incorporation of the relief association so provide. The bylaws or articles of incorporation 114.23may define a "month," but the definition must require a calendar month to have at least 16 114.24days of active service. If the bylaws or articles of incorporation do not define a "month," a 114.25"month" is a completed calendar month of active service measured from the member's 114.26date of entry to the same date in the subsequent month. 114.27(e) At the time of retirement under subdivision 2 and any applicable provision of the 114.28bylaws of the relief association, a retiring member is entitled to that portion of the assets 114.29of the special fund to the credit of the member in the individual member account which is 114.30nonforfeitable under subdivision 3 and any applicable provision of the bylaws of the relief 114.31association based on the number of years of service to the credit of the retiring member. 114.32(f) Annually, the secretary of the relief association shall certify the individual 114.33account allocations to the state auditor at the same time that the annual financial statement 114.34or financial report and audit of the relief association, whichever applies, is due under 114.35section 69.051. 114.36 new text begin EFFECTIVE DATE. new text end new text begin This section is effective the day following final enactment. new text end 115.1    Sec. 7. Minnesota Statutes 2013 Supplement, section 424A.016, subdivision 6, is 115.2amended to read: 115.3    Subd. 6. Deferred service pensions. (a) A member of a relief association is entitled 115.4to a deferred service pension if the member separates from active service and membership 115.5and has completed the minimum service and membership requirements in subdivision 2. 115.6The requirement that a member separate from active service and membership is waived 115.7for persons who have discontinued their volunteer firefighter duties and who are employed 115.8on a full-time basis under section 424A.015, subdivision 1. 115.9    (b) The deferred service pension is payable when the former member reaches at 115.10least age 50, or at least the minimum age specified in the bylaws governing the relief 115.11association if that age is greater than age 50, and when the former member makes a valid 115.12written application. 115.13    (c) A defined contribution relief association may, if its governing bylaws so provide, 115.14credit interest or additional investment performance on the deferred lump-sum service 115.15pension during the period of deferral. If provided for in the bylaws, the interest must be 115.16paid: 115.17(1) at the investment performance rate actually earned on that portion of the assets 115.18if the deferred benefit amount is invested by the relief association in a separate account 115.19established and maintained by the relief association; 115.20(2) at the investment performance rate actually earned on that portion of the assets 115.21if the deferred benefit amount is invested in a separate investment vehicle held by the 115.22relief association; or 115.23(3) at the investment return on the assets of the special fund of the defined contribution 115.24volunteer firefighter relief association in proportion to the share of the assets of the special 115.25fund to the credit of each individual deferred member account through the accounting date 115.26on which the investment return is recognized by and credited to the special fund. 115.27    (d) Unless the bylaws of a relief association that has elected to pay interest or 115.28additional investment performance on deferred lump-sum service pensions under 115.29paragraph (c) specifies a different interest or additional investment performance method, 115.30including the interest or additional investment performance period starting date and ending 115.31date, the interest or additional investment performance on a deferred service pension 115.32is creditable as follows: 115.33(1) for a relief association that has elected to pay interest or additional investment 115.34performance under paragraph (c), clause (1) or (3), beginning on the date that the 115.35member separates from active service and membership and ending on the accounting 116.1date immediately before the deferred member commences receipt of the deferred service 116.2pension; or 116.3(2) for a relief association that has elected to pay interest or additional investment 116.4performance under paragraph (c), clause (2), beginning on the date that the member 116.5separates from active service and membership and ending on the date that the separate 116.6investment vehicle is valued immediately before the date on which the deferred member 116.7commences receipt of the deferred service pension. 116.8(e) The deferred service pension is governed by and must be calculated under 116.9the general statute, special law, relief association articles of incorporation, and relief 116.10association bylaw provisions applicable on the date on which the member separated from 116.11active service with the fire department and active membership in the relief association. 116.12 new text begin EFFECTIVE DATE. new text end new text begin This section is effective the day following final enactment. new text end 116.13    Sec. 8. Minnesota Statutes 2012, section 424A.016, subdivision 7, is amended to read: 116.14    Subd. 7. Limitation on ancillary benefits. (a) A defined contribution relief 116.15association may only pay an ancillary benefit which would constitute an authorized 116.16disbursement as specified in section 424A.05. The ancillary benefit for active members 116.17must equal the vested and nonvested amount of the individual account of the member. 116.18(b) For deferred members, the ancillary benefit must equal the vested amount of 116.19the individual account of the member. For the recipient of installment payments of a 116.20service pension, the ancillary benefit must equal the remaining balance in the individual 116.21account of the recipient. 116.22(c) new text begin If the bylaws permit and as defined by the bylaws, the relief association may pay new text end 116.23 new text begin an ancillary benefit to, or on behalf of, a member who is not active or deferred. new text end 116.24 new text begin (d) new text end (1) If a survivor or death benefit is payable under the articles of incorporation or 116.25bylaws, the benefit must be paid: 116.26(i) as a survivor benefit to the surviving spouse of the deceased firefighter; 116.27(ii) as a survivor benefit to the surviving children of the deceased firefighter if no 116.28surviving spouse; 116.29(iii) as a survivor benefit to a designated beneficiary of the deceased firefighter if no 116.30surviving spouse or surviving children; or 116.31(iv) as a death benefit to the estate of the deceased active or deferred firefighter if no 116.32surviving spouse, no surviving children, and no beneficiary designated. 116.33(2) If there are no surviving children, the surviving spouse may waive, in writing, 116.34wholly or partially, the spouse's entitlement to a survivor benefit. 117.1(d) new text begin (e) new text end For purposes of this section, for a defined contribution volunteer fire relief 117.2association, a trust created under chapter 501B may be a designated beneficiary. If a trust 117.3payable to the surviving children organized under chapter 501B has been established as 117.4authorized by this section and there is no surviving spouse, the survivor benefit may be 117.5paid to the trust, notwithstanding the requirements of this section. 117.6 new text begin EFFECTIVE DATE. new text end new text begin This section is effective the day following final enactment. new text end 117.7    Sec. 9. Minnesota Statutes 2013 Supplement, section 424A.02, subdivision 3, is 117.8amended to read: 117.9    Subd. 3. Flexible service pension maximums. (a) Annually on or before August 117.101 as part of the certification of the financial requirements and minimum municipal 117.11obligation determined under section 424A.092, subdivision 4, or 424A.093, subdivision 117.125 , as applicable, the secretary or some other official of the relief association designated 117.13in the bylaws of each defined benefit relief association shall calculate and certify to the 117.14governing body of the applicable qualified municipality the average amount of available 117.15financing per active covered firefighter for the most recent three-year period. The amount 117.16of available financing includes any amounts of fire state aid received or receivable by the 117.17relief association, any amounts of municipal contributions to the relief association raised 117.18from levies on real estate or from other available revenue sources exclusive of fire state 117.19aid, and one-tenth of the amount of assets in excess of the accrued liabilities of the relief 117.20association calculated under section 424A.092, subdivision 2; 424A.093, subdivisions 2 117.21and 4; or 424A.094, subdivision 2, if any. 117.22    (b) The maximum service pension which the defined benefit relief association has 117.23authority to provide for in its bylaws for payment to a member retiring after the calculation 117.24date when the minimum age and service requirements specified in subdivision 1 are met 117.25must be determined using the table in paragraph (c) or (d), whichever applies. 117.26    (c) For a defined benefit relief association where the governing bylaws provide for 117.27a monthly service pension to a retiring member, the maximum monthly service pension 117.28amount per month for each year of service credited that may be provided for in the bylaws 117.29is the greater of the service pension amount provided for in the bylaws on the date of the 117.30calculation of the average amount of the available financing per active covered firefighter 117.31or the maximum service pension figure corresponding to the average amount of available 117.32financing per active covered firefighter: 118.1 118.2 118.3 Minimum Average Amount of Available Financing per Firefighter Maximum Service Pension Amount Payable per Month for Each Year of Service 118.4 $ ... $ .25 118.5 41 .50 118.6 81 1.00 118.7 122 1.50 118.8 162 2.00 118.9 203 2.50 118.10 243 3.00 118.11 284 3.50 118.12 324 4.00 118.13 365 4.50 118.14 405 5.00 118.15 486 6.00 118.16 567 7.00 118.17 648 8.00 118.18 729 9.00 118.19 810 10.00 118.20 891 11.00 118.21 972 12.00 118.22 1053 13.00 118.23 1134 14.00 118.24 1215 15.00 118.25 1296 16.00 118.26 1377 17.00 118.27 1458 18.00 118.28 1539 19.00 118.29 1620 20.00 118.30 1701 21.00 118.31 1782 22.00 118.32 1823 22.50 118.33 1863 23.00 118.34 1944 24.00 118.35 2025 25.00 118.36 2106 26.00 118.37 2187 27.00 118.38 2268 28.00 118.39 2349 29.00 118.40 2430 30.00 118.41 2511 31.00 118.42 2592 32.00 118.43 2673 33.00 118.44 2754 34.00 119.1 2834 35.00 119.2 2916 36.00 119.3 2997 37.00 119.4 3078 38.00 119.5 3159 39.00 119.6 3240 40.00 119.7 3321 41.00 119.8 3402 42.00 119.9 3483 43.00 119.10 3564 44.00 119.11 3645 45.00 119.12 3726 46.00 119.13 3807 47.00 119.14 3888 48.00 119.15 3969 49.00 119.16 4050 50.00 119.17 4131 51.00 119.18 4212 52.00 119.19 4293 53.00 119.20 4374 54.00 119.21 4455 55.00 119.22 4536 56.00 119.23 Effective beginning December 31, 2008 119.24 4617 57.00 119.25 4698 58.00 119.26 4779 59.00 119.27 4860 60.00 119.28 4941 61.00 119.29 5022 62.00 119.30 5103 63.00 119.31 5184 64.00 119.32 5265 65.00 119.33 Effective beginning December 31, 2009 119.34 5346 66.00 119.35 5427 67.00 119.36 5508 68.00 119.37 5589 69.00 119.38 5670 70.00 119.39 5751 71.00 119.40 5832 72.00 119.41 5913 73.00 119.42 5994 74.00 119.43 Effective beginning December 31, 2010 120.1 6075 75.00 120.2 6156 76.00 120.3 6237 77.00 120.4 6318 78.00 120.5 6399 79.00 120.6 6480 80.00 120.7 6561 81.00 120.8 6642 82.00 120.9 6723 83.00 120.10 Effective beginning December 31, 2011 120.11 6804 84.00 120.12 6885 85.00 120.13 6966 86.00 120.14 7047 87.00 120.15 7128 88.00 120.16 7209 89.00 120.17 7290 90.00 120.18 7371 91.00 120.19 7452 92.00 120.20 Effective beginning December 31, 2012 120.21 7533 93.00 120.22 7614 94.00 120.23 7695 95.00 120.24 7776 96.00 120.25 7857 97.00 120.26 7938 98.00 120.27 8019 99.00 120.28 8100 100.00 120.29 any amount in excess of 120.30 8100 100.00 120.31    (d) For a defined benefit relief association in which the governing bylaws provide 120.32for a lump-sum service pension to a retiring member, the maximum lump-sum service 120.33pension amount for each year of service credited that may be provided for in the bylaws is 120.34the greater of the service pension amount provided for in the bylaws on the date of the 120.35calculation of the average amount of the available financing per active covered firefighter 120.36or the maximum service pension figure corresponding to the average amount of available 120.37financing per active covered firefighter for the applicable specified period: 120.38 120.39 120.40 Minimum Average Amount of Available Financing per Firefighter Maximum Lump-Sum Service Pension Amount Payable for Each Year of Service 120.41 $ ... $ 10 120.42 11 20 121.1 16 30 121.2 23 40 121.3 27 50 121.4 32 60 121.5 43 80 121.6 54 100 121.7 65 120 121.8 77 140 121.9 86 160 121.10 97 180 121.11 108 200 121.12 131 240 121.13 151 280 121.14 173 320 121.15 194 360 121.16 216 400 121.17 239 440 121.18 259 480 121.19 281 520 121.20 302 560 121.21 324 600 121.22 347 640 121.23 367 680 121.24 389 720 121.25 410 760 121.26 432 800 121.27 486 900 121.28 540 1000 121.29 594 1100 121.30 648 1200 121.31 702 1300 121.32 756 1400 121.33 810 1500 121.34 864 1600 121.35 918 1700 121.36 972 1800 121.37 1026 1900 121.38 1080 2000 121.39 1134 2100 121.40 1188 2200 121.41 1242 2300 121.42 1296 2400 121.43 1350 2500 122.1 1404 2600 122.2 1458 2700 122.3 1512 2800 122.4 1566 2900 122.5 1620 3000 122.6 1672 3100 122.7 1726 3200 122.8 1753 3250 122.9 1780 3300 122.10 1820 3375 122.11 1834 3400 122.12 1888 3500 122.13 1942 3600 122.14 1996 3700 122.15 2023 3750 122.16 2050 3800 122.17 2104 3900 122.18 2158 4000 122.19 2212 4100 122.20 2265 4200 122.21 2319 4300 122.22 2373 4400 122.23 2427 4500 122.24 2481 4600 122.25 2535 4700 122.26 2589 4800 122.27 2643 4900 122.28 2697 5000 122.29 2751 5100 122.30 2805 5200 122.31 2859 5300 122.32 2913 5400 122.33 2967 5500 122.34 3021 5600 122.35 3075 5700 122.36 3129 5800 122.37 3183 5900 122.38 3237 6000 122.39 3291 6100 122.40 3345 6200 122.41 3399 6300 122.42 3453 6400 122.43 3507 6500 123.1 3561 6600 123.2 3615 6700 123.3 3669 6800 123.4 3723 6900 123.5 3777 7000 123.6 3831 7100 123.7 3885 7200 123.8 3939 7300 123.9 3993 7400 123.10 4047 7500 123.11 Effective beginning December 31, 2008 123.12 4101 7600 123.13 4155 7700 123.14 4209 7800 123.15 4263 7900 123.16 4317 8000 123.17 4371 8100 123.18 4425 8200 123.19 4479 8300 123.20 Effective beginning December 31, 2009 123.21 4533 8400 123.22 4587 8500 123.23 4641 8600 123.24 4695 8700 123.25 4749 8800 123.26 4803 8900 123.27 4857 9000 123.28 4911 9100 123.29 Effective beginning December 31, 2010 123.30 4965 9200 123.31 5019 9300 123.32 5073 9400 123.33 5127 9500 123.34 5181 9600 123.35 5235 9700 123.36 5289 9800 123.37 5343 9900 123.38 5397 10,000 123.39 any amount in excess of 123.40 5397 10,000 123.41    (e) For a defined benefit relief association in which the governing bylaws provide 123.42for a monthly benefit service pension as an alternative form of service pension payment 124.1to a lump-sum service pension, the maximum service pension amount for each pension 124.2payment type must be determined using the applicable table contained in this subdivision. 124.3    (f) If a defined benefit relief association establishes a service pension in compliance 124.4with the applicable maximum contained in paragraph (c) or (d) and the minimum average 124.5amount of available financing per active covered firefighter is subsequently reduced 124.6because of a reduction in fire state aid or because of an increase in the number of active 124.7firefighters, the relief association may continue to provide the prior service pension 124.8amount specified in its bylaws, but may not increase the service pension amount until 124.9the minimum average amount of available financing per firefighter under the table in 124.10paragraph (c) or (d), whichever applies, permits. 124.11    (g) No defined benefit relief association is authorized to provide a service pension in 124.12an amount greater than the largest applicable flexible service pension maximum amount 124.13even if the amount of available financing per firefighter is greater than the financing 124.14amount associated with the largest applicable flexible service pension maximum. 124.15(h) The method of calculating service pensions must be applied uniformly for all 124.16years of active service. Credit must be given for all years of active service except for caps 124.17on service credit if so provided in the bylaws of the relief association. 124.18 new text begin EFFECTIVE DATE. new text end new text begin This section is effective the day following final enactment. new text end 124.19    Sec. 10. Minnesota Statutes 2013 Supplement, section 424A.02, subdivision 7, is 124.20amended to read: 124.21    Subd. 7. Deferred service pensions. (a) A member of a defined benefit relief 124.22association is entitled to a deferred service pension if the member separates from active 124.23service and membership and has completed the minimum service and membership 124.24requirements in subdivision 1. The requirement that a member separate from active service 124.25and membership is waived for persons who have discontinued their volunteer firefighter 124.26duties and who are employed on a full-time basis under section 424A.015, subdivision 1. 124.27    (b) The deferred service pension is payable when the former member reaches at 124.28least age 50, or at least the minimum age specified in the bylaws governing the relief 124.29association if that age is greater than age 50, and when the former member makes a valid 124.30written application. 124.31    (c) A defined benefit relief association that provides a lump-sum service pension 124.32governed by subdivision 3 may, when its governing bylaws so provide, pay interest on the 124.33deferred lump-sum service pension during the period of deferral. If provided for in the 124.34bylaws, interest must be paid in one of the following manners: 125.1    (1) at the investment performance rate actually earned on that portion of the assets 125.2if the deferred benefit amount is invested by the relief association in a separate account 125.3established and maintained by the relief association; 125.4(2) at the investment performance rate actually earned on that portion of the assets 125.5if the deferred benefit amount is invested in a separate investment vehicle held by the 125.6relief association; or 125.7    (3) at an interest rate of up to five percent, compounded annually, as set by the 125.8board of trustees. 125.9(d) Any change in the interest rate set by the board of directors new text begin trustees new text end under 125.10paragraph (c), clause (3), must be ratified by the governing body of the municipality 125.11served by the fire department to which the relief association is directly associated, or by 125.12the independent nonprofit firefighting corporation, as applicable. 125.13    (e) Interest under paragraph (c), clause (3), is payable beginning on the January 1 125.14next following the date on which the deferred service pension interest rate as set by the 125.15board of trustees was ratified by the governing body of the municipality served by the fire 125.16department to which the relief association is directly associated, or by the independent 125.17nonprofit firefighting corporation, as applicable. 125.18    (f) Unless the bylaws of a relief association that has elected to pay interest or 125.19additional investment performance on deferred lump-sum service pensions under 125.20paragraph (c) specifies a different interest or additional investment performance method, 125.21including the interest or additional investment performance period starting date and ending 125.22date, the interest or additional investment performance on a deferred service pension 125.23is creditable as follows: 125.24(1) for a relief association that has elected to pay interest or additional investment 125.25performance under paragraph (c), clause (1) or (3), beginning on the first day of the 125.26month next following the date on which the member separates from active service and 125.27membership and ending on the last day of the month immediately before the month in 125.28which the deferred member commences receipt of the deferred service pension; or 125.29(2) for a relief association that has elected to pay interest or additional investment 125.30performance under paragraph (c), clause (2), beginning on the date that the member 125.31separates from active service and membership and ending on the date that the separate 125.32investment vehicle is valued immediately before the date on which the deferred member 125.33commences receipt of the deferred service pension. 125.34(g) For a deferred service pension that is transferred to a separate account established 125.35and maintained by the relief association or separate investment vehicle held by the relief 125.36association, the deferred member bears the full investment risk subsequent to transfer and 126.1in calculating the accrued liability of the volunteer firefighters relief association that pays 126.2a lump-sum service pension, the accrued liability for deferred service pensions is equal 126.3to the separate relief association account balance or the fair market value of the separate 126.4investment vehicle held by the relief association. 126.5    (h) The deferred service pension is governed by and must be calculated under 126.6the general statute, special law, relief association articles of incorporation, and relief 126.7association bylaw provisions applicable on the date on which the member separated from 126.8active service with the fire department and active membership in the relief association. 126.9 new text begin EFFECTIVE DATE. new text end new text begin This section is effective the day following final enactment. new text end 126.10    Sec. 11. Minnesota Statutes 2012, section 424A.05, subdivision 3, is amended to read: 126.11    Subd. 3. Authorized disbursements from special fund. Disbursements from the 126.12special fund may not be made for any purpose other than one of the following: 126.13    (1) for the payment of service pensions to retired members of the relief association if 126.14authorized and paid under law and the bylaws governing the relief association; 126.15(2) for the purchase of an annuity for the applicable person under section 424A.015, 126.16subdivision 3, for the transfer of service pension or benefit amounts to the applicable 126.17person's individual retirement account under section 424A.015, subdivision 4, or to the 126.18applicable person's account in the Minnesota deferred compensation plan under section 126.19424A.015, subdivision 5 ; 126.20    (3) for the payment of temporary or permanent disability benefits to disabled 126.21members of the relief association if authorized and paid under law and specified in amount 126.22in the bylaws governing the relief association; 126.23    (4) for the payment of survivor benefits or for the payment of a death benefit to the 126.24estate of the deceased active or deferred firefighter, if authorized and paid under law and 126.25specified in amount in the bylaws governing the relief association; 126.26    (5) for the payment of the fees, dues and assessments to the Minnesota State Fire 126.27Department Association and to the Minnesota Area Relief new text begin State Fire Chiefs new text end Association 126.28Coalition in order to entitle relief association members to membership in and the benefits 126.29of these associations or organizations; 126.30(6) for the payment of insurance premiums to the state Volunteer Firefighters Benefit 126.31Association, or an insurance company licensed by the state of Minnesota offering casualty 126.32insurance, in order to entitle relief association members to membership in and the benefits 126.33of the association or organization; and 126.34    (7) for the payment of administrative expenses of the relief association as authorized 126.35under section 69.80. 127.1 new text begin EFFECTIVE DATE. new text end new text begin This section is effective the day following final enactment. new text end 127.2    Sec. 12. Minnesota Statutes 2012, section 424A.08, is amended to read: 127.3424A.08 MUNICIPALITY WITHOUT RELIEF ASSOCIATION; 127.4AUTHORIZED DISBURSEMENTS. 127.5(a) Any qualified municipality which is entitled to receive fire state aid but which 127.6has no volunteer firefighters' relief association directly associated with its fire department 127.7and which has no full-time firefighters with retirement coverage by the public employees 127.8police and fire retirement plan shall deposit the fire state aid in a special account 127.9established for that purpose in the municipal treasury. Disbursement from the special 127.10account may not be made for any purpose except: 127.11(1) payment of the fees, dues and assessments to the Minnesota State Fire 127.12Department Association and to the state Volunteer Firefighters' Benefit Association in 127.13order to entitle its firefighters to membership in and the benefits of these state associations; 127.14(2) payment of the cost of purchasing and maintaining needed equipment for the 127.15fire department; and 127.16(3) payment of the cost of construction, acquisition, repair, or maintenance of 127.17buildings or other premises to house the equipment of the fire department. 127.18(b) A qualified municipality which is entitled to receive fire state aid, which has no 127.19volunteer firefighters' relief association directly associated with its fire department, which 127.20does not participate in the voluntary statewide lump-sum volunteer firefighter retirement 127.21plan under chapter 353G, and which has full-time firefighters with retirement coverage 127.22by the public employees police and fire retirement plan may disburse the fire state aid as 127.23provided in paragraph (a), for the payment of the employer contribution requirement with 127.24respect to firefighters covered by the public employees police and fire retirement plan under 127.25section 353.65, subdivision 3, or for a combination of the two types of disbursements. 127.26(c) A municipality that has no volunteer firefighters' relief association directly 127.27associated with it and that participates in the voluntary statewide lump-sum volunteer 127.28firefighter retirement plan under chapter 353G shall transmit any fire state aid that it 127.29receives to the voluntary statewide lump-sum volunteer firefighter retirement fund. 127.30 new text begin EFFECTIVE DATE. new text end new text begin This section is effective the day following final enactment. new text end 127.31    Sec. 13. Minnesota Statutes 2013 Supplement, section 424A.092, subdivision 6, 127.32is amended to read: 128.1    Subd. 6. Municipal ratification for plan amendments. If the special fund of 128.2the relief association does not have a surplus over full funding under subdivision 3, 128.3paragraph (c), clause (5), and if the municipality is required to provide financial support 128.4to the special fund of the relief association under this section, the adoption of or any 128.5amendment to the articles of incorporation or bylaws of a relief association which 128.6increases or otherwise affects the retirement coverage provided by or the service pensions 128.7or retirement benefits payable from the special fund of any relief association to which this 128.8section applies is not effective until it is ratified by the governing body of the municipality 128.9in which the relief association is located new text begin served by the fire department to which the new text end 128.10 new text begin relief association is directly associated or by the independent nonprofit firefighting new text end 128.11 new text begin corporation, as applicable, new text end and the officers of a relief association shall not seek municipal 128.12ratification prior to preparing and certifying an estimate of the expected increase in the 128.13accrued liability and annual accruing liability of the relief association attributable to the 128.14amendment. If the special fund of the relief association has a surplus over full funding 128.15under subdivision 3, paragraph (c), clause (5), and if the municipality is not required to 128.16provide financial support to the special fund of the relief association under this section, 128.17the relief association may adopt or amend its articles of incorporation or bylaws which 128.18increase or otherwise affect the retirement coverage provided by or the service pensions 128.19or retirement benefits payable from the special fund of the relief association which are 128.20effective without municipal ratification so long as this does not cause the amount of the 128.21resulting increase in the accrued liability of the special fund of the relief association to 128.22exceed 90 percent of the amount of the surplus over full funding reported in the prior year 128.23and this does not result in the financial requirements of the special fund of the relief 128.24association exceeding the expected amount of the future fire state aid to be received by 128.25the relief association as determined by the board of trustees following the preparation 128.26of an estimate of the expected increase in the accrued liability and annual accruing 128.27liability of the relief association attributable to the change. If a relief association adopts or 128.28amends its articles of incorporation or bylaws without municipal ratification under this 128.29subdivision, and, subsequent to the amendment or adoption, the financial requirements 128.30of the special fund of the relief association under this section are such so as to require 128.31financial support from the municipality, the provision which was implemented without 128.32municipal ratification is no longer effective without municipal ratification and any service 128.33pensions or retirement benefits payable after that date may be paid only in accordance with 128.34the articles of incorporation or bylaws as amended or adopted with municipal ratification. 128.35 new text begin EFFECTIVE DATE. new text end new text begin This section is effective the day following final enactment. new text end 129.1    Sec. 14. Minnesota Statutes 2013 Supplement, section 424A.093, subdivision 2, 129.2is amended to read: 129.3    Subd. 2. Determination of actuarial condition and funding costs. A relief 129.4association to which this section applies shall obtain an actuarial valuation showing the 129.5condition of the special fund of the relief association as of December 31, 1978, and at 129.6least as of December 31 every four years thereafter. The valuation shall be prepared in 129.7accordance with the provisions of sections 356.215, subdivision 8, and 356.216 and any 129.8applicable standards for actuarial work established by the Legislative Commission on 129.9Pensions and Retirement, except that the figure for normal cost shall be expressed as a 129.10level dollar amount, and the amortization contribution shall be the level dollar amount 129.11calculated to amortize any current unfunded accrued liability by at least the date of full 129.12funding specified in subdivision 4, clause (b). Each valuation shall be filed with the 129.13governing body of the municipality in which the relief association is located new text begin served by the new text end 129.14 new text begin fire department to which the relief association is directly associated or by the independent new text end 129.15 new text begin nonprofit firefighting corporation, as applicable, new text end and with the state auditor, not later than 129.16July 1 of the year next following the date as of which the actuarial valuation is prepared. 129.17Any relief association which is operating under a special law which requires that actuarial 129.18valuations be obtained at least every four years and be prepared in accordance with 129.19applicable actuarial standards set forth in statute may continue to have actuarial valuations 129.20made according to the time schedule set forth in the special legislation subject to the 129.21provisions of subdivision 3. 129.22 new text begin EFFECTIVE DATE. new text end new text begin This section is effective the day following final enactment. new text end 129.23    Sec. 15. Minnesota Statutes 2013 Supplement, section 424A.093, subdivision 6, 129.24is amended to read: 129.25    Subd. 6. Municipal ratification for plan amendments. If the special fund of the 129.26relief association does not have a surplus over full funding under subdivision 4, and 129.27if the municipality is required to provide financial support to the special fund of the 129.28relief association under this section, the adoption of or any amendment to the articles of 129.29incorporation or bylaws of a relief association which increases or otherwise affects the 129.30retirement coverage provided by or the service pensions or retirement benefits payable 129.31from the special fund of any relief association to which this section applies is not effective 129.32until it is ratified by the governing body of the municipality in which the relief association 129.33is located new text begin served by the fire department to which the relief association is directly associated new text end 129.34 new text begin or by the independent nonprofit firefighting corporation, as applicable new text end . If the special 129.35fund of the relief association has a surplus over full funding under subdivision 4, and if 130.1the municipality is not required to provide financial support to the special fund of the 130.2relief association under this section, the relief association may adopt or amend its articles 130.3of incorporation or bylaws which increase or otherwise affect the retirement coverage 130.4provided by or the service pensions or retirement benefits payable from the special fund 130.5of the relief association which are effective without municipal ratification so long as this 130.6does not cause the amount of the resulting increase in the accrued liability of the special 130.7fund of the relief association to exceed 90 percent of the amount of the surplus over full 130.8funding reported in the prior year and this does not result in the financial requirements of 130.9the special fund of the relief association exceeding the expected amount of the future fire 130.10state aid to be received by the relief association as determined by the board of trustees 130.11following the preparation of an updated actuarial valuation including the proposed change 130.12or an estimate of the expected actuarial impact of the proposed change prepared by the 130.13actuary of the relief association. If a relief association adopts or amends its articles of 130.14incorporation or bylaws without municipal ratification pursuant to this subdivision, and, 130.15subsequent to the amendment or adoption, the financial requirements of the special fund 130.16of the relief association under this section are such so as to require financial support from 130.17the municipality, the provision which was implemented without municipal ratification is 130.18no longer effective without municipal ratification and any service pensions or retirement 130.19benefits payable after that date may be paid only in accordance with the articles of 130.20incorporation or bylaws as amended or adopted with municipal ratification. 130.21 new text begin EFFECTIVE DATE. new text end new text begin This section is effective the day following final enactment. new text end 130.22    Sec. 16. Minnesota Statutes 2013 Supplement, section 424A.094, subdivision 2, 130.23is amended to read: 130.24    Subd. 2. Determination of actuarial condition and funding costs. Each 130.25independent nonprofit firefighting corporation to which this section applies shall determine 130.26the actuarial condition and the funding costs of the subsidiary relief association using 130.27the following procedure: 130.28(1) An independent nonprofit firefighting corporation which has a subsidiary relief 130.29association which pays a monthly benefit service pension shall procure an actuarial 130.30valuation of the special fund of the subsidiary relief association at the same times and 130.31in the same manner as specified in section 424A.093, subdivisions 2 and 3, and an 130.32independent nonprofit firefighting corporation which has a subsidiary relief association 130.33which pays a lump-sum service pension shall determine the accrued liability of the special 130.34fund of the relief association in accordance with section 424A.092, subdivision 2. 131.1(2) The financial requirements of the special fund of the subsidiary relief association 131.2which pays a monthly benefit service pension shall be determined in the same manner 131.3as specified in section 424A.093, subdivision 4, and the financial requirements of the 131.4special fund of the subsidiary relief association shall be determined in the same manner as 131.5specified in section 424A.092, subdivision 3. 131.6(3) The minimum obligation of the independent nonprofit firefighting corporation on 131.7behalf of the special fund of the subsidiary relief association shall be determined in the 131.8same manner as specified in section new text begin 424A.092, subdivision 4, or new text end 424A.093, subdivision 5 new text begin , new text end 131.9 new text begin as applicable new text end . 131.10(4) The independent nonprofit firefighting corporation shall appropriate annually 131.11from the income of the corporation an amount at least equal to the minimum obligation 131.12of the independent nonprofit firefighting corporation on behalf of the special fund of 131.13the subsidiary relief association. 131.14 new text begin EFFECTIVE DATE. new text end new text begin This section is effective the day following final enactment. new text end 131.15    Sec. 17. Minnesota Statutes 2013 Supplement, section 424A.10, subdivision 2, is 131.16amended to read: 131.17    Subd. 2. Payment of supplemental benefit. (a) Upon the payment by a volunteer 131.18firefighters' relief association or by the voluntary statewide lump-sum volunteer firefighter 131.19retirement plan of a lump-sum distribution to a qualified recipient, the association must 131.20pay a supplemental benefit to the qualified recipient. Notwithstanding any law to the 131.21contrary, the relief association must pay the supplemental benefit out of its special fund 131.22and the voluntary statewide lump-sum volunteer firefighter retirement plan must pay 131.23the supplemental benefit out of the voluntary statewide lump-sum volunteer firefighter 131.24retirement plan. This benefit is an amount equal to ten percent of the regular lump-sum 131.25distribution that is paid on the basis of the recipient's service as a volunteer firefighter. 131.26In no case may the amount of the supplemental benefit exceed $1,000. A supplemental 131.27benefit under this paragraph may not be paid to a survivor of a deceased active or deferred 131.28volunteer firefighter in that capacity. 131.29    (b) Upon the payment by a relief association or the retirement plan of a lump-sum 131.30survivor benefit to a survivor of a deceased active volunteer firefighter or of a deceased 131.31deferred volunteer firefighter, the association must pay a supplemental survivor benefit to 131.32the survivor of the deceased active or deferred volunteer firefighter from the special fund 131.33of the relief association and the retirement plan must pay a supplemental survivor benefit 131.34to the survivor of the deceased active or deferred volunteer firefighter from the retirement 132.1fund if chapter 353G so provides. The amount of the supplemental survivor benefit is 20 132.2percent of the survivor benefit, but not to exceed $2,000. 132.3    (c) new text begin For purposes of this section, the term "regular lump-sum distribution" means the new text end 132.4 new text begin pretax lump-sum distribution excluding any interest that may have been credited during a new text end 132.5 new text begin volunteer firefighter's period of deferral. new text end 132.6     new text begin (d) new text end An individual may receive a supplemental benefit under paragraph (a) or under 132.7paragraph (b), but not under both paragraphs with respect to one lump-sum volunteer 132.8firefighter benefit. 132.9 new text begin EFFECTIVE DATE. new text end new text begin This section is effective the day following final enactment. new text end 132.10    Sec. 18. Minnesota Statutes 2012, section 424B.12, is amended to read: 132.11424B.12 MIXED CONSOLIDATING RELIEF ASSOCIATIONS; BENEFIT 132.12PLAN; FUNDING. 132.13    Subdivision 1. Applicability. This section applies where one or more of the 132.14volunteer firefighters' relief associations involved in the consolidation are defined benefit 132.15relief associations as defined in section 424A.001, subdivision 1b, and one or more of 132.16the volunteer firefighters' relief associations involved in the consolidation are defined 132.17contribution relief associations as defined in section 424A.001, subdivision 1c. 132.18    Subd. 2. Benefit plan. The articles of incorporation or bylaws of the successor 132.19relief association must specify whether the relief association is a defined benefit relief 132.20association or whether the relief association is a defined contribution relief association. If 132.21the successor relief association is a defined benefit relief association, the relief association 132.22benefits must comply with sections 424A.02 and 424B.11, subdivision 1a new text begin 424B.10 new text end . If 132.23the successor relief association is a defined contribution relief association, the relief 132.24association must comply with sections 424A.016 and 424B.12 new text begin 424B.11 new text end , subdivision 2. 132.25    Subd. 3. Funding. If the successor relief association is a defined benefit relief 132.26association, the relief association funding is governed by section 424B.11 new text begin 424B.10 new text end , 132.27subdivision 2. If the successor relief association is a defined contribution relief association, 132.28the relief association funding is governed by section 424B.12 new text begin 424B.11 new text end , subdivision 3. 132.29 new text begin EFFECTIVE DATE. new text end new text begin This section is effective the day following final enactment. new text end 132.30ARTICLE 13 132.31MISCELLANEOUS RETIREMENT PROVISIONS 132.32    Section 1. Minnesota Statutes 2012, section 11A.17, subdivision 1, is amended to read: 133.1    Subdivision 1. Purpose; accounts; continuation. (a) The purpose of the 133.2supplemental investment fund is to provide an investment vehicle for the assets of various 133.3public retirement plans and funds. 133.4(b) The fund consists of eight investment accounts: an income share account, a 133.5growth share account, an international share account, a money market account, a fixed 133.6interest account, a bond market account, a common stock index account, and a volunteer 133.7firefighter account. new text begin The state board shall determine and make available investment new text end 133.8 new text begin accounts within the supplemental investment fund. These accounts shall include an new text end 133.9 new text begin appropriate array of diversified investment options for participants of the public retirement new text end 133.10 new text begin plans under subdivision 5. new text end 133.11(c) The new text begin assets of the new text end supplemental investment fund is a continuation of the 133.12supplemental retirement fund in existence on January 1, 1980 new text begin must be invested by the new text end 133.13 new text begin state board in types of investments permitted under section 11A.24 new text end . 133.14 new text begin (d) The state board shall make available a volunteer firefighter account for the new text end 133.15 new text begin voluntary statewide lump-sum volunteer firefighter retirement plan under section 353G.02. new text end 133.16 new text begin EFFECTIVE DATE. new text end new text begin This section is effective July 1, 2014. new text end 133.17    Sec. 2. Minnesota Statutes 2012, section 11A.17, subdivision 9, is amended to read: 133.18    Subd. 9. Valuation of investment shares. new text begin (a) new text end The value of investment shares in 133.19the income share account, the growth share account, the international share account, 133.20the bond market account, and the common stock index new text begin for each investment new text end account new text begin , new text end 133.21 new text begin excluding a money market account, new text end must be determined by dividing the total market 133.22value of the securities constituting the respective account by the total number of shares 133.23then outstanding in the investment account. 133.24 new text begin (b) new text end The value of investment shares in the new text begin a new text end money market account and the fixed 133.25interest account is new text begin must be new text end $1 a share. Terms as to withdrawal schedules will be agreed 133.26upon by the public retirement fund and the state board. 133.27 new text begin EFFECTIVE DATE. new text end new text begin This section is effective July 1, 2014. new text end 133.28    Sec. 3. Minnesota Statutes 2012, section 352.115, subdivision 8, is amended to read: 133.29    Subd. 8. Accrual of annuity. State employees shall apply for an annuity. The 133.30application new text begin for an annuity new text end must not be made more than 90 new text begin 60 new text end days before the time the new text begin state new text end 133.31employee is eligible to retire by reason of both age and service requirements new text begin or former new text end 133.32 new text begin state employee elects to begin collecting a retirement annuity new text end . If the director determines an 133.33applicant for annuity has fulfilled the legal requirements for an annuity, the director shall 134.1authorize the annuity payment in accordance with this chapter and payment must be made 134.2as authorized. An annuity shall begin to accrue no earlier than 180 days before the date the 134.3application is filed with the director, but not before the day following the termination of 134.4state service or before the day the employee is eligible to retire by reason of both age and 134.5service requirements. The retirement annuity shall cease with the last payment which had 134.6accrued during the lifetime of the retired employee unless an optional annuity provided in 134.7section 352.116, subdivision 3, had been selected and had become payable. The joint and 134.8last survivor annuity shall cease with the last payment received by the survivor during 134.9the lifetime of the survivor. If a retired employee had not selected an optional annuity, or 134.10a survivor annuity is not payable under the option, and a spouse survives, the spouse is 134.11entitled only to the annuity for the calendar month in which the retired employee died. 134.12If an optional annuity is payable after the death of the retired employee, the survivor is 134.13entitled to the annuity for the calendar month in which the retired employee died. 134.14 new text begin EFFECTIVE DATE. new text end new text begin This section is effective July 1, 2014. new text end 134.15    Sec. 4. Minnesota Statutes 2012, section 352.115, subdivision 10, is amended to read: 134.16    Subd. 10. Reemployment of annuitant. (a) Except for salary or wages received 134.17as a temporary employee of the legislature during a legislative session, if any retired 134.18employee again becomes entitled to receive salary or wages from any employer who 134.19employs state employees as that term is defined in section 352.01, subdivision 2, in a 134.20position covered by this chapter, the annuity or retirement allowance must cease when new text begin the new text end 134.21 new text begin first of the month following the month that new text end the retired employee has earned an amount 134.22equal to the annual maximum earnings allowable for that age for the continued receipt of 134.23full benefit amounts monthly under the federal old age, survivors, and disability insurance 134.24program as set by the secretary of health and human services under United States Code, 134.25title 42, section 403, in any calendar year. If the retired employee has not yet reached the 134.26minimum age for the receipt of Social Security benefits, the maximum earnings for the 134.27retired employee are equal to the annual maximum earnings allowable for the minimum 134.28age for the receipt of Social Security benefits. 134.29(b) The balance of the annual retirement annuity after cessation must be handled or 134.30disposed of as provided in section 356.47. 134.31(c) The annuity must be resumed when new text begin the first of the month following the month new text end 134.32 new text begin that new text end state service ends, or, if the retired employee is still employed at the beginning of the 134.33next calendar year, at the beginning of that calendar year, and payment must again end 134.34when the retired employee has earned the applicable reemployment earnings maximum 134.35specified in this subdivision. If the retired employee is granted a sick leave without pay, 135.1but not otherwise, the annuity or retirement allowance must be resumed during the period 135.2of sick leave. 135.3(d) No payroll deductions for the retirement fund may be made from the earnings of 135.4a reemployed retired employee. 135.5(e) No change may be made in the monthly amount of an annuity or retirement 135.6allowance because of the reemployment of an annuitant. 135.7(f) If a reemployed annuitant whose annuity is suspended under paragraph (a) 135.8is having insurance premium amounts withheld under section 356.87, subdivision 2, 135.9insurance premium amounts must continue to be withheld and transferred from the 135.10suspended portion of the annuity. The balance of the annual retirement annuity after 135.11cessation, after deduction of the insurance premium amounts, must be treated as specified 135.12in paragraph (b). 135.13 new text begin (g) If a reemployed annuitant whose annuity is suspended under paragraph (a) new text end 135.14 new text begin has a former spouse receiving a portion of the annuity allowable under section 518.58, new text end 135.15 new text begin subdivision 1, the portion payable to the former spouse must continue to be paid. new text end 135.16 new text begin EFFECTIVE DATE. new text end new text begin This section is effective retroactively from January 1, 2014. new text end 135.17    Sec. 5. Minnesota Statutes 2012, section 352.965, subdivision 4, is amended to read: 135.18    Subd. 4. Plan investments. (a) new text begin Available new text end investments under the plan may include: 135.19 new text begin are those investments chosen by the State Board of Investment under section 356.645 for new text end 135.20 new text begin the plan. new text end 135.21    (1) shares in the Minnesota supplemental investment fund established in section 135.22 that are selected to be offered under the plan by the State Board of Investment; 135.23    (2) saving accounts in federally insured financial institutions; 135.24    (3) life insurance contracts, fixed annuity, and variable annuity contracts from 135.25companies that are subject to regulation by the commissioner of commerce; 135.26    (4) investment options from open-end investment companies registered under the 135.27federal Investment Company Act of 1940, United States Code, title 15, sections 80a-1 135.28to 80a-64; 135.29    (5) investment options from a firm that is a registered investment advisor under the 135.30Investment Advisers Act of 1940, United States Code, title 15, sections 80b-1 to 80b-21; 135.31    (6) investment options of a bank as defined in United States Code, title 15, section 135.3280b-2, subsection (a), paragraph (2), or a bank holding company as defined in the Bank 135.33Holding Company Act of 1956, United States Code, title 12, section 1841, subsection 135.34(a), paragraph (1); or 136.1    (7) a combination of clause (1), (2), (3), (4), (5), or (6), as provided by the plan as 136.2specified by the participant. 136.3    (b) All amounts contributed to the deferred compensation plan and all earnings 136.4on those amounts must be held for the exclusive benefit of the plan participants and 136.5beneficiaries. These amounts must be held in trust, in custodial accounts, or in qualifying 136.6annuity contracts as required by federal law in accordance with section , 136.7subdivision 1. This subdivision does not authorize an employer contribution, except as 136.8authorized in section 356.24, subdivision 1, paragraph (a), clause (5). The state, political 136.9subdivision, or other employing unit is not responsible for any loss that may result from 136.10investment of the deferred compensation. 136.11 new text begin EFFECTIVE DATE. new text end new text begin This section is effective July 1, 2014. new text end 136.12    Sec. 6. Minnesota Statutes 2012, section 352.965, is amended by adding a subdivision 136.13to read: 136.14     new text begin Subd. 4a. new text end new text begin Exclusive benefit. new text end new text begin All amounts contributed to the deferred compensation new text end 136.15 new text begin plan and all earnings on those amounts must be held for the exclusive benefit of the plan new text end 136.16 new text begin participants and beneficiaries. These amounts must be held in trust, in custodial accounts, new text end 136.17 new text begin or in qualifying annuity contracts as required by federal law in accordance with section new text end 136.18 new text begin , subdivision 1. new text end 136.19 new text begin EFFECTIVE DATE. new text end new text begin This section is effective July 1, 2014. new text end 136.20    Sec. 7. Minnesota Statutes 2012, section 352.965, is amended by adding a subdivision 136.21to read: 136.22     new text begin Subd. 4b. new text end new text begin Employer contribution prohibition. new text end new text begin Except as authorized in section new text end 136.23 new text begin 356.24, subdivision 1 new text end new text begin , clause (5), employer contributions are prohibited. new text end 136.24 new text begin EFFECTIVE DATE. new text end new text begin This section is effective July 1, 2014. new text end 136.25    Sec. 8. Minnesota Statutes 2012, section 352.98, subdivision 2, is amended to read: 136.26    Subd. 2. Contracting authorized. new text begin (a) new text end The executive director shall administer 136.27the plan and contract with public and private entities to provide investment services, 136.28record keeping, benefit payments, and other functions necessary for the administration of 136.29the plan. If allowed by 136.30     new text begin (b) As specified in section 356.645, new text end the Minnesota State Board of Investment, the 136.31Minnesota State Board of Investment supplemental investment funds may be offered as 137.1 new text begin shall determine an appropriate selection of new text end investment options under new text begin that shall be offered new text end 137.2 new text begin by new text end the health care savings plan or plans. 137.3 new text begin EFFECTIVE DATE. new text end new text begin This section is effective July 1, 2014. new text end 137.4    Sec. 9. Minnesota Statutes 2012, section 352D.04, is amended by adding a subdivision 137.5to read: 137.6     new text begin Subd. 1a. new text end new text begin State Board of Investment selection of investment products. new text end new text begin As new text end 137.7 new text begin specified in section 356.645, the State Board of Investment shall select investment new text end 137.8 new text begin products to be available to participants in the retirement program provided by this chapter. new text end 137.9 new text begin EFFECTIVE DATE. new text end new text begin This section is effective July 1, 2014. new text end 137.10    Sec. 10. Minnesota Statutes 2012, section 352D.04, is amended by adding a 137.11subdivision to read: 137.12     new text begin Subd. 1b. new text end new text begin Participant selection of investments. new text end new text begin (a) A program participant may new text end 137.13 new text begin elect to participate in one or more of the investment products made available under the new text end 137.14 new text begin program by specifying the percentage of the participant's contributions under subdivision new text end 137.15 new text begin 2 to be used to purchase shares in the applicable products. new text end 137.16 new text begin (b) Before making an allocation election, or if the participant fails to specify an new text end 137.17 new text begin allocation, the executive director shall, on behalf of that participant, purchase shares new text end 137.18 new text begin in a default investment alternative. The investment alternative must be specified by new text end 137.19 new text begin the Minnesota State Retirement System Board from the available investment options new text end 137.20 new text begin authorized under subdivision 1a. new text end 137.21 new text begin (c) A participant may revise the investment allocation for subsequent purchase of new text end 137.22 new text begin shares, and a participant or former participant may also change the investment options new text end 137.23 new text begin selected for all or a portion of shares previously purchased. new text end 137.24 new text begin (d) Any investment allocation selection authorized under this subdivision, whether new text end 137.25 new text begin relating to subsequent purchases of new shares or reallocating the existing portfolio, new text end 137.26 new text begin must be conducted at times and under procedures prescribed by the executive director. new text end 137.27 new text begin Any allocation or allocation revisions are effective at the end of the most recent United new text end 137.28 new text begin States investment market day, unless subject to trading restrictions imposed on certain new text end 137.29 new text begin investment options. new text end 137.30 new text begin EFFECTIVE DATE. new text end new text begin This section is effective July 1, 2014. new text end 137.31    Sec. 11. Minnesota Statutes 2012, section 353.27, subdivision 4, is amended to read: 138.1    Subd. 4. Employer reporting requirements; contributions; member status. 138.2(a) A representative authorized by the head of each department shall deduct employee 138.3contributions from the salary of each public employee who qualifies for membership in 138.4the general employees retirement plan of the Public Employees Retirement Association 138.5or in the public employees police and fire retirement plan under this chapter or chapter 138.6353D or 353E at the rate under section 353.27, 353.65, 353D.03, or 353E.03, whichever is 138.7applicable, that is in effect on the date the salary is paid. The employer representative must 138.8also remit payment in a manner prescribed by the executive director for the aggregate 138.9amount of the employee contributions and the required employer contributions to be 138.10received by the association within 14 calendar days after each pay date. If the payment is 138.11less than the amount required, the employer must pay the shortage amount to the association 138.12and collect reimbursement of any employee contribution shortage paid on behalf of a 138.13member through subsequent payroll withholdings from the wages of the employee. 138.14Payment of shortages in employee contributions and associated employer contributions, if 138.15applicable, must include interest at the rate specified in section 353.28, subdivision 5, if not 138.16received within 30 days following the date the amount was initially due under this section. 138.17(b) The head of each department or the person's designee shall submit for each 138.18pay period to the association a salary deduction report in the format prescribed by the 138.19executive director. The report must be received by the association within 14 calendar 138.20days after each pay date or the employer may be assessed a fine of $5 per calendar day 138.21until the association receives the required data. Data required as part of salary deduction 138.22reporting must include, but are not limited to: 138.23(1) the legal names and Social Security numbers of employees who are members; 138.24(2) the amount of each employee's salary deduction; 138.25(3) the amount of salary defined in section 353.01, subdivision 10, earned in the pay 138.26period from which each deduction was made new text begin , including a breakdown of the portion of the new text end 138.27 new text begin salary that represents overtime pay that the employee was paid for additional hours worked new text end 138.28 new text begin beyond the regularly scheduled hours, pay for unused compensatory time, new text end and the salary 138.29amount earned by a reemployed annuitant under section 353.37, subdivision 1, or 353.371, 138.30subdivision 1 , or by a disabled member under section 353.33, subdivision 7 or 7a; 138.31(4) the beginning and ending dates of the payroll period covered and the date of 138.32actual payment; and 138.33(5) adjustments or corrections covering past pay periods as authorized by the 138.34executive director. 138.35(c) Employers must furnish the data required for enrollment for each new or 138.36reinstated employee who qualifies for membership in the general employees retirement 139.1plan of the Public Employees Retirement Association or in the public employees police 139.2and fire retirement plan in the format prescribed by the executive director. The required 139.3enrollment data on new members must be submitted to the association prior to or 139.4concurrent with the submission of the initial employee salary deduction. Also, the 139.5employer shall report to the association all member employment status changes, such as 139.6leaves of absence, terminations, and death, and shall report the effective dates of those 139.7changes, on an ongoing basis for the payroll cycle in which they occur. If an employer 139.8fails to comply with the reporting requirements under this paragraph, the executive 139.9director may assess a fine of $25 for each failure if the association staff has notified the 139.10employer of the noncompliance and attempted to obtain the missing data or form from the 139.11employer for a period of more than three months. 139.12(d) The employer shall furnish data, forms, and reports as may be required by 139.13the executive director for proper administration of the retirement system. Before 139.14implementing new or different computerized reporting requirements, the executive 139.15director shall give appropriate advance notice to governmental subdivisions to allow time 139.16for system modifications. 139.17(e) Notwithstanding paragraph (a), the executive director may provide for less 139.18frequent reporting and payments for small employers. 139.19(f) The executive director may establish reporting procedures and methods as 139.20required to review compliance by employers with the salary and contribution reporting 139.21requirements in this chapter. A review of the payroll records of a participating employer 139.22may be conducted by the association on a periodic basis or as a result of concerns known 139.23to exist within a governmental subdivision. An employer under review must extract 139.24requested data and provide records to the association after receiving reasonable advanced 139.25notice. Failure to provide requested information or materials will result in the employer 139.26being liable to the association for any expenses associated with a field audit, which may 139.27include staff salaries, administrative expenses, and travel expenses. 139.28 new text begin EFFECTIVE DATE. new text end new text begin This section is effective January 1, 2015. new text end 139.29    Sec. 12. Minnesota Statutes 2012, section 353.37, is amended by adding a subdivision 139.30to read: 139.31     new text begin Subd. 6. new text end new text begin Treatment in certain divorce situations. new text end new text begin Notwithstanding other new text end 139.32 new text begin subdivisions of this section, if a reemployed annuitant whose annuity is suspended or new text end 139.33 new text begin reduced under this section has a former spouse receiving a portion of the annuity under new text end 139.34 new text begin section 518.58, subdivision 1, the portion payable to the former spouse must not be new text end 139.35 new text begin suspended or deferred. new text end 140.1 new text begin EFFECTIVE DATE. new text end new text begin This section is effective retroactively from January 1, 2014. new text end 140.2    Sec. 13. Minnesota Statutes 2012, section 353.371, is amended by adding a subdivision 140.3to read: 140.4     new text begin Subd. 8. new text end new text begin Program expiration. new text end new text begin (a) Initial postretirement option employment new text end 140.5 new text begin agreements must not be entered into after June 30, 2019. new text end 140.6 new text begin (b) This section expires on June 30, 2024. new text end 140.7 new text begin EFFECTIVE DATE. new text end new text begin This section is effective July 1, 2014. new text end 140.8    Sec. 14. Minnesota Statutes 2013 Supplement, section 353.651, subdivision 4, is 140.9amended to read: 140.10    Subd. 4. Early retirement. (a) A person who becomes a public employees police 140.11and fire retirement plan member after June 30, 2007, or a former member who is reinstated 140.12as a member of the plan after that date, who is at least 50 years of age and is at least 140.13partially vested under section 353.01, subdivision 47, upon the termination of public 140.14service new text begin employees police and fire retirement plan membership new text end before July 1, 2014, if the 140.15person is other than a county sheriff or after January 4, 2015, if the person is a county 140.16sheriff is entitled upon application to a retirement annuity equal to the normal annuity 140.17calculated under subdivision 3, reduced by two-tenths of one percent for each month that 140.18the member is under age 55 at the time of retirement. 140.19    (b) Upon the termination of public service new text begin employees police and fire retirement new text end 140.20 new text begin plan membership new text end before July 1, 2014, if the person is other than a county sheriff or 140.21upon the termination of public service before January 5, 2015, if the person is a county 140.22sheriff, any public employees police and fire retirement plan member who first became 140.23a member of the plan before July 1, 2007, and who is not specified in paragraph (a), 140.24upon attaining at least 50 years of age with at least three years of allowable service is 140.25entitled upon application to a retirement annuity equal to the normal annuity calculated 140.26under subdivision 3, reduced by one-tenth of one percent for each month that the member 140.27is under age 55 at the time of retirement. 140.28(c) A person other than a county sheriff who is a member of the public employees 140.29police and fire retirement plan on or after July 1, 2014, or a county sheriff who is a 140.30member of the public employees police and fire retirement plan on or after January 5, 140.312015, and who is at least 50 years old and is at least partially vested under section 353.01, 140.32subdivision 47, and whose benefit effective date is after July 1, 2014, if other than a 140.33county sheriff or after January 4, 2015, if a county sheriff and on or before July 1, 2019, is 140.34entitled upon application to a retirement annuity equal to the normal annuity calculated 141.1under subdivision 3, reduced for each month the member is under age 55 at the time of 141.2retirement by applying a blended monthly rate that is equivalent to the sum of: 141.3(1) one-sixtieth of the annual rate of five percent, prorated for each month the 141.4person's benefit effective date is after July 1, 2014, or after December 31, 2014, whichever 141.5applies; and 141.6(2) one-sixtieth of the annual rate provided under paragraph (a) or (b), whichever 141.7applies, for each month the person's benefit effective date is before July 1, 2019. 141.8(d) A person other than a county sheriff who is a member of the public employees 141.9police and fire retirement plan on or after July 1, 2014, or a county sheriff who is a member 141.10of the public employees police and fire retirement plan on or after January 5, 2015, and 141.11who is at least 50 years old and is at least partially vested under section 353.01, subdivision 141.1247 , whose benefit effective date is after July 1, 2019, is entitled, upon application, to a 141.13retirement annuity equal to the normal annuity calculated under subdivision 3, reduced by 141.14five percent annually, prorated for each month that the member is under age 55. 141.15 new text begin EFFECTIVE DATE. new text end new text begin This section is effective the day following final enactment. new text end 141.16    Sec. 15. Minnesota Statutes 2012, section 353D.05, subdivision 1, is amended to read: 141.17    Subdivision 1. Investment. new text begin As further specified under this section, new text end employing unit 141.18contributions, after the deduction of an amount for administrative expenses, and individual 141.19participant contributions must be remitted to new text begin invested in the participant's account or new text end 141.20 new text begin accounts in investment products authorized by the association that are made available new text end 141.21 new text begin for this purpose by new text end the State Board of Investment for investment in the Minnesota 141.22supplemental investment fund established by new text begin under new text end section 11A.17 new text begin 356.645 new text end . 141.23 new text begin EFFECTIVE DATE. new text end new text begin This section is effective July 1, 2014. new text end 141.24    Sec. 16. Minnesota Statutes 2012, section 353D.05, is amended by adding a 141.25subdivision to read: 141.26     new text begin Subd. 1a. new text end new text begin Participant selection of investments. new text end new text begin (a) A plan participant may elect new text end 141.27 new text begin to allocate contributions, made by and on behalf of the participant, in one or more of the new text end 141.28 new text begin investment products authorized by the association to be made available under the plan, new text end 141.29 new text begin by specifying the percentage of the participant's contributions to be used to purchase new text end 141.30 new text begin shares in the authorized products. new text end 141.31 new text begin (b) If contributions are received before the participant has made an allocation new text end 141.32 new text begin election, or if the participant fails to specify an allocation, the executive director shall, new text end 141.33 new text begin on behalf of that participant, purchase shares in a default investment alternative. The new text end 142.1 new text begin investment option must be specified by the Public Employees Retirement Association board new text end 142.2 new text begin of trustees from the designated available investment options authorized under this section. new text end 142.3 new text begin (c) A participant may revise the investment allocation for subsequent purchase of new text end 142.4 new text begin shares, and a participant or former participant may also change the investment options new text end 142.5 new text begin selected for all or a portion of shares previously purchased. new text end 142.6 new text begin (d) Any investment allocation selection authorized under this subdivision, whether new text end 142.7 new text begin relating to subsequent purchases of new shares or reallocating the existing portfolio, must new text end 142.8 new text begin be conducted at times and under procedures prescribed by the executive director. new text end 142.9 new text begin EFFECTIVE DATE. new text end new text begin This section is effective July 1, 2014. new text end 142.10    Sec. 17. Minnesota Statutes 2012, section 354.44, subdivision 5, is amended to read: 142.11    Subd. 5. Resumption of teaching service after retirement. (a) Any person who 142.12retired under the provisions of this chapter and has thereafter resumed teaching in any 142.13employer unit to which this chapter applies is eligible to continue to receive payments 142.14in accordance with the annuity except that all or a portion of the annuity payments must 142.15be deferred during the calendar year immediately following the fiscal year in which the 142.16person's salary from the teaching service is in an amount greater than $46,000. The 142.17amount of the annuity deferral is one-half of the salary amount in excess of $46,000 and 142.18must be deducted from the annuity payable for the calendar year immediately following 142.19the fiscal year in which the excess amount was earned. 142.20    (b) If the person is retired for only a fractional part of the fiscal year during the initial 142.21year of retirement, the maximum reemployment salary exempt from triggering a deferral 142.22as specified in this subdivision must be prorated for that fiscal year. 142.23    (c) After a person has reached the Social Security normal retirement age, no deferral 142.24requirement is applicable regardless of the amount of salary. 142.25    (d) The amount of the retirement annuity deferral must be handled or disposed 142.26of as provided in section 356.47. 142.27    (e) For the purpose of this subdivision, salary from teaching service includes new text begin all new text end 142.28 new text begin salary or income earned as a teacher as defined in section 354.05, subdivision 2, paragraph new text end 142.29 new text begin (a), clause (1). Salary from teaching service also includes new text end , but is not limited to: 142.30    (1) all income for services performed as a consultant or an new text begin , new text end independent contractor 142.31for new text begin , or third-party supplier, or as a employee of a consultant, independent contractor, or new text end 142.32 new text begin third-party supplier, to new text end an employer unit covered by the provisions of this chapter; and 142.33    (2) the greater of either the income received or an amount based on the rate paid with 142.34respect to an administrative position, consultant, or independent contractor new text begin , or third-party new text end 142.35 new text begin supplier, or as an employee of a consultant, independent contractor, or third-party supplier, new text end 143.1 in an employer unit with approximately the same number of pupils and at the same level 143.2as the position occupied by the person who resumes teaching service. 143.3 new text begin (f) Notwithstanding other paragraphs of this subdivision, if the reemployed annuitant new text end 143.4 new text begin has a former spouse receiving a portion of the annuity under section 518.58, subdivision 1, new text end 143.5 new text begin the portion payable to the former spouse must not be deferred. new text end 143.6 new text begin EFFECTIVE DATE. new text end new text begin This section is effective July 1, 2014. new text end 143.7    Sec. 18. Minnesota Statutes 2012, section 354.48, subdivision 6a, is amended to read: 143.8    Subd. 6a. Medical adviser; duties. The state commissioner of health or a 143.9licensed physician on the staff of the Department of Health who is designated by the 143.10commissioner is the medical adviser of The executive director new text begin may contract with an new text end 143.11 new text begin accredited independent organization specializing in disability determinations, licensed new text end 143.12 new text begin physicians, or physicians on the staff of the commissioner of health as designated by the new text end 143.13 new text begin commissioner, to be the medical advisor to the executive director new text end . The medical adviser 143.14shall designate licensed physicians, licensed chiropractors, or licensed psychologists with 143.15respect to a mental impairment, who shall examine applicants for disability benefits. The 143.16medical adviser shall pass upon all expert reports based on any examinations performed 143.17in order to determine whether a teacher is totally and permanently disabled as defined in 143.18section 354.05, subdivision 14. The medical adviser shall also investigate all health and 143.19medical statements and certificates by or on behalf of a teacher in connection with a 143.20disability benefit, and shall report in writing to the director setting forth any conclusions 143.21and recommendations on all matters referred to the medical adviser. 143.22 new text begin EFFECTIVE DATE. new text end new text begin This section is effective July 1, 2014. new text end 143.23    Sec. 19. Minnesota Statutes 2013 Supplement, section 356.415, subdivision 1c, 143.24is amended to read: 143.25    Subd. 1c. Annual postretirement adjustments; PERA-police and fire. (a) 143.26Retirement annuity, disability benefit, or survivor benefit recipients of the public 143.27employees police and fire retirement plan are entitled to a postretirement adjustment 143.28annually on January 1, until funding stability is restored, as follows: 143.29(1) for each annuitant or benefit recipient whose annuity or benefit effective date is 143.30on or before June 1, 2014, who has been receiving the annuity or benefit for at least 12 143.31full months as of the immediate preceding June 30, an amount equal to one percent in 143.32each year; or 144.1(2) for each annuitant or benefit recipient whose annuity or benefit effective date is 144.2on or before June 1, 2014, who has been receiving the annuity or benefit for at least one 144.3full month, but not less than 11 months, as of the immediate preceding June 30, an amount 144.4equal to 1/12 of one percent for each month of annuity or benefit receipt; and 144.5(3) for each annuitant or benefit recipient whose annuity or benefit effective date is 144.6after June 1, 2014, new text begin unless section 27 applies, new text end who will have been receiving an annuity 144.7or benefit for at least 36 full months as of the immediate preceding June 30, an amount 144.8equal to one percent; or 144.9(4) for each annuitant or benefit recipient whose annuity or benefit effective date is 144.10after June 1, 2014, new text begin unless section 27 applies, new text end who has been receiving the annuity or benefit 144.11for at least 25 full months, but less than 36 months as of the immediate preceding June 30, 144.12an amount equal to 1/12 of one percent for each full month of annuity or benefit receipt 144.13during the fiscal year in which the annuity or benefit was effective. 144.14(b) Retirement annuity, disability benefit, or survivor benefit recipients of the public 144.15employees police and fire retirement plan are entitled to a postretirement adjustment 144.16annually on each January 1 following the restoration of funding stability as defined under 144.17paragraph (c) and during the continuation of funding stability as defined under paragraph 144.18(c), as follows: 144.19(1) for each annuitant or benefit recipient who has been receiving the annuity or 144.20benefit for at least 36 full months as of the immediate preceding June 30, an amount 144.21equal to the percentage increase in the Consumer Price Index for urban wage earners and 144.22clerical workers all items index published by the Bureau of Labor Statistics of the United 144.23States Department of Labor between the immediate preceding June 30 and the June 30 144.24occurring 12 months previous, but not to exceed 2.5 percent; and 144.25(2) for each annuitant or benefit recipient who has been receiving the annuity 144.26or benefit for at least 25 full months, but less than 36 full months, as of the immediate 144.27preceding June 30, an amount equal to 1/12 of the percentage increase in the Consumer 144.28Price Index for urban wage earners and clerical workers all items index published by 144.29the Bureau of Labor Statistics of the United States Department of Labor between the 144.30immediate preceding June 30 and the June 30 occurring 12 months previous for each full 144.31month of annuity or benefit receipt during the fiscal year in which the annuity or benefit 144.32was effective, but not to exceed 1/12 of 2.5 percent for each full month of annuity or 144.33benefit receipt during the fiscal year in which the annuity or benefit was effective. 144.34(c) Funding stability is restored when the market value of assets of the public 144.35employees police and fire retirement plan equals or exceeds 90 percent of the actuarial 144.36accrued liabilities of the applicable plan in the two most recent consecutive actuarial 145.1valuations prepared under section 356.215 and under the standards for actuarial work of 145.2the Legislative Commission on Pensions and Retirement by the approved actuary retained 145.3by the Public Employees Retirement Association under section 356.214. 145.4(d) After having met the definition of funding stability under paragraph (c), a full 145.5or prorated increase, as provided in paragraph (a), clause (1), (2), (3), or (4), whichever 145.6applies, rather than adjustments under paragraph (b), is again applied in a subsequent year 145.7or years if the market value of assets of the public employees police and fire retirement 145.8plan equals or is less than: 145.9(1) 85 percent of the actuarial accrued liabilities of the applicable plan for two 145.10consecutive actuarial valuations; or 145.11(2) 80 percent of the actuarial accrued liabilities of the applicable plan for the most 145.12recent actuarial valuation. 145.13(e) An increase in annuity or benefit payments under this section must be made 145.14automatically unless written notice is filed by the annuitant or benefit recipient with the 145.15executive director of the Public Employees Retirement Association requesting that the 145.16increase not be made. 145.17 new text begin EFFECTIVE DATE. new text end new text begin This section is effective the day following final enactment new text end 145.18 new text begin and the amendments to this section expire on February 2, 2015. new text end 145.19    Sec. 20. Minnesota Statutes 2012, section 356.635, subdivision 6, is amended to read: 145.20    Subd. 6. Eligible retirement plan. (a) An "eligible retirement plan" is: 145.21(1) an individual retirement account under section 408(a) or 408A of the federal 145.22Internal Revenue Code; 145.23(2) an individual retirement annuity plan under section 408(b) of the federal Internal 145.24Revenue Code; 145.25(3) an annuity plan under section 403(a) of the federal Internal Revenue Code; 145.26(4) a qualified trust plan under section 401(a) of the federal Internal Revenue Code 145.27that accepts the distributee's eligible rollover distribution; 145.28(5) an annuity contract under section 403(b) of the federal Internal Revenue Code; 145.29(6) an eligible deferred compensation plan under section 457(b) of the federal 145.30Internal Revenue Code, which is maintained by a state or local government and which 145.31agrees to separately account for the amounts transferred into the plan; or 145.32(7) in the case of an eligible rollover distribution to a nonspousal beneficiary, an 145.33individual account or annuity treated as an inherited individual retirement account under 145.34section 402(c)(11) of the federal Internal Revenue Code. 146.1(b) For distributions of after-tax contributions which are not includable in gross 146.2income, the after-tax portion may be transferred only to an individual retirement account 146.3or annuity described in section 408(a) or (b) of the federal Internal Revenue Code, to a 146.4Roth individual retirement account described in section 408A of the federal Internal 146.5Revenue Code, or to a qualified plan described in either section 401(a) new text begin of the federal new text end 146.6 new text begin Internal Revenue Code new text end or 403(a) new text begin to an annuity contract described in section 403(b) new text end of 146.7the federal Internal Revenue Code, that agrees to separately account for the amounts 146.8transferred, including separately accounting for the portion of the distribution which is 146.9includable in gross income and the portion of the distribution which is not includable. 146.10 new text begin EFFECTIVE DATE. new text end new text begin This section is effective the day following final enactment. new text end 146.11    Sec. 21. new text begin [356.645] INVESTMENT OF VARIOUS DEFINED CONTRIBUTION new text end 146.12 new text begin PLAN ASSETS. new text end 146.13 new text begin The State Board of Investment shall determine the investments to be made available new text end 146.14 new text begin to plan participants in plans defined in sections 352.965 and 352.98 and chapters 352D new text end 146.15 new text begin and 353D. Investments made available to plan participants must include at least one new text end 146.16 new text begin or more of the following: new text end 146.17 new text begin (1) shares in the Minnesota supplemental investment fund established in section new text end 146.18 new text begin 11A.17; new text end 146.19 new text begin (2) saving accounts in federally insured financial institutions; new text end 146.20 new text begin (3) life insurance contracts, fixed annuity contracts, and variable annuity contracts new text end 146.21 new text begin from companies that are subject to regulation by the commissioner of commerce; new text end 146.22 new text begin (4) investment options from open-end investment companies registered under the new text end 146.23 new text begin federal Investment Company Act of 1940, United States Code, title 15, sections 80a-1 new text end 146.24 new text begin to 80a-64; new text end 146.25 new text begin (5) investment options from a firm that is a registered investment adviser under new text end 146.26 new text begin the Investment Advisers Act of 1940, United States Code, title 15, sections 80b-1 to new text end 146.27 new text begin 80b-21; and new text end 146.28 new text begin (6) investment options of a bank as defined in United States Code, title 15, section new text end 146.29 new text begin 80b-2, subsection (a), paragraph (2), or a bank holding company as defined in the Bank new text end 146.30 new text begin Holding Company Act of 1956, United States Code, title 12, section 1841, subsection new text end 146.31 new text begin (a), paragraph (1). new text end 146.32 new text begin EFFECTIVE DATE. new text end new text begin This section is effective July 1, 2014. new text end 146.33    Sec. 22. new text begin [356.646] PLAN PARTICIPANT INVESTMENT RESPONSIBILITY. new text end 147.1     new text begin Subdivision 1. new text end new text begin Member investment responsibility. new text end new text begin The state, State Board of new text end 147.2 new text begin Investment and its executive director and staff, plan administrators and their staff, and new text end 147.3 new text begin participating public employers are not liable and are not responsible for any investment new text end 147.4 new text begin losses due to choices made by participants or due to qualified default investment new text end 147.5 new text begin alternatives. new text end 147.6     new text begin Subd. 2. new text end new text begin Application. new text end new text begin This section applies to the: new text end 147.7     new text begin (1) Minnesota state deferred compensation plan, established under section 352.965; new text end 147.8     new text begin (2) health care savings plan, established under section 352.98; new text end 147.9     new text begin (3) unclassified employees retirement program, established under chapter 352D; new text end 147.10     new text begin (4) public employees defined contribution plan, established under chapter 353D; new text end 147.11     new text begin (5) individual retirement account plan, established under chapter 354B; new text end 147.12     new text begin (6) higher education supplemental retirement plan, established under chapter 354C; new text end 147.13 new text begin and new text end 147.14     new text begin (7) Arts Board and Humanities Commission individual retirement account plan, new text end 147.15 new text begin established under chapter 354D. new text end 147.16 new text begin EFFECTIVE DATE. new text end new text begin This section is effective July 1, 2014. new text end 147.17    Sec. 23. Minnesota Statutes 2013 Supplement, section 356.91, is amended to read: 147.18356.91 VOLUNTARY MEMBERSHIP DUES DEDUCTION. 147.19    (a) Upon written authorization of a person receiving an annuity from a public pension 147.20fund administered by the Minnesota State Retirement System or new text begin , new text end the Public Employees 147.21Retirement Association, new text begin or the Teachers Retirement Association, new text end the executive director of 147.22the public pension fund shall deduct from the retirement annuity an amount requested by 147.23the annuitant to be paid as membership dues or other payments to any labor organization 147.24that is an exclusive bargaining agent representing public employees or an organization 147.25representing retired public employees of which the annuitant is a member and shall, on a 147.26monthly basis, pay the amount to the organization so designated by the annuitant. 147.27    (b) A pension fund and the plan fiduciaries which authorize or administer deductions 147.28of dues payments under paragraph (a) are not liable for failure to properly deduct or transmit 147.29the dues amounts, provided that the fund and the fiduciaries have acted in good faith. 147.30    (c) Any labor organization that is an exclusive bargaining agent representing public 147.31employees or an organization representing retired public employees may conduct blind 147.32mailings to the annuitants of a retirement system specified in paragraph (a) by requesting 147.33that the retirement system mail voluntary membership information and dues deduction 147.34cards to annuitants. Such mailings shall not be for the purpose of supporting or opposing 148.1any candidate, political party, or ballot measure. The organization requesting the blind 148.2mailing shall pay all costs associated with these mailings, including but not limited to 148.3copying, labeling, mailing, postage, and record keeping. In lieu of administering a blind 148.4mailing in-house, a retirement system may transmit annuitant data necessary for conducting 148.5a blind mailing to a mail center pursuant to a secure data share agreement with the mail 148.6center which provides that neither the organization nor any other entity shall have direct 148.7access to the data transmitted by the retirement system. The retirement system shall have 148.8no obligation to approve or disapprove, or otherwise be responsible for, the content of the 148.9mailings. No organization shall conduct more than two blind mailings per calendar year. 148.10 new text begin EFFECTIVE DATE. new text end new text begin This section is effective July 2, 2015. new text end 148.11    Sec. 24. Minnesota Statutes 2013 Supplement, section 363A.36, subdivision 1, is 148.12amended to read: 148.13    Subdivision 1. Scope of application. (a) For all contracts for goods and services in 148.14excess of $100,000, no department or agency of the state shall accept any bid or proposal 148.15for a contract or agreement from any business having more than 40 full-time employees 148.16within this state on a single working day during the previous 12 months, unless the 148.17commissioner is in receipt of the business' affirmative action plan for the employment of 148.18minority persons, women, and qualified disabled individuals. No department or agency of 148.19the state shall execute any such contract or agreement until the affirmative action plan 148.20has been approved by the commissioner. Receipt of a certificate of compliance issued by 148.21the commissioner shall signify that a firm or business has an affirmative action plan that 148.22has been approved by the commissioner. A certificate shall be valid for a period of four 148.23years. A municipality as defined in section 466.01, subdivision 1, that receives state 148.24money for any reason is encouraged to prepare and implement an affirmative action plan 148.25for the employment of minority persons, women, and the qualified disabled and submit the 148.26plan to the commissioner. 148.27    (b) This paragraph applies to a contract for goods or services in excess of $100,000 148.28to be entered into between a department or agency of the state and a business that is 148.29not subject to paragraph (a), but that has more than 40 full-time employees on a single 148.30working day during the previous 12 months in the state where the business has its primary 148.31place of business. A department or agency of the state may not execute a contract or 148.32agreement with a business covered by this paragraph unless the business has a certificate 148.33of compliance issued by the commissioner under paragraph (a) or the business certifies 148.34that it is in compliance with federal affirmative action requirements. 149.1    (c) This section does not apply to contracts entered into by the State Board of 149.2Investment for investment options under section 352.965, subdivision 4 new text begin 356.645 new text end . 149.3    (d) The commissioner shall issue a certificate of compliance or notice of denial 149.4within 15 days of the application submitted by the business or firm. 149.5 new text begin EFFECTIVE DATE. new text end new text begin This section is effective July 1, 2014. new text end 149.6    Sec. 25. Laws 2009, chapter 169, article 5, section 2, the effective date, as amended by 149.7Laws 2010, chapter 359, article 5, section 27, is amended to read: 149.8EFFECTIVE DATE.This section is effective the day following final enactment 149.9and expires on June 30, 2014. Individuals must not be appointed to a postretirement 149.10option position after that date. 149.11 new text begin EFFECTIVE DATE. new text end new text begin This section is effective the day following final enactment. new text end 149.12    Sec. 26. new text begin COUNTY SHERIFF TEMPORARY EARLY RETIREMENT new text end 149.13 new text begin PROVISION. new text end 149.14     new text begin Subdivision 1. new text end new text begin Application. new text end new text begin (a) This section applies to a county sheriff who: new text end 149.15 new text begin (1) terminates membership in the public employees police and fire retirement plan new text end 149.16 new text begin after June 30, 2014, and by the final day in office in January 2015 as reported by the county; new text end 149.17 new text begin (2) is at least age 50 but less than age 55 on the date of termination; new text end 149.18 new text begin (3) is at least partially vested under Minnesota Statutes, section 353.01, subdivision new text end 149.19 new text begin 47, and meets all applicable requirements for receipt of an early retirement annuity from new text end 149.20 new text begin the plan; and new text end 149.21 new text begin (4) has as the benefit effective date the day following termination of public new text end 149.22 new text begin employees police and fire retirement plan membership. new text end 149.23 new text begin (b) Notwithstanding any provision of Minnesota Statutes, section 353.651, new text end 149.24 new text begin subdivision 4, to the contrary, the early retirement annuity applicable to an eligible person new text end 149.25 new text begin under paragraph (a) is the applicable benefit specified in subdivision 2. new text end 149.26     new text begin Subd. 2. new text end new text begin Early retirement annuity. new text end new text begin (a) If an eligible person became a public new text end 149.27 new text begin employees police and fire retirement plan member after June 30, 2007, or was a former new text end 149.28 new text begin member who was reinstated as a member after that date, the person is entitled, upon new text end 149.29 new text begin application, to the normal annuity calculated under Minnesota Statutes, section 353.651, new text end 149.30 new text begin subdivision 3, reduced by two-tenths of one percent for each month that the member new text end 149.31 new text begin is under age 55 at the time of retirement. new text end 149.32 new text begin (b) If an eligible person became a public employees police and fire retirement plan new text end 149.33 new text begin member before July 1, 2007, and is covered under paragraph (a), the person is entitled, new text end 150.1 new text begin upon application, to the normal annuity calculated under Minnesota Statutes, section new text end 150.2 new text begin 353.651, subdivision 3, reduced by one-tenth of one percent for each month that the new text end 150.3 new text begin member is under age 55 at the time of retirement. new text end 150.4 new text begin (c) If an eligible person is not fully vested, the annuity computed under this section new text end 150.5 new text begin must be reduced accordingly. new text end 150.6     new text begin Subd. 3. new text end new text begin Expiration. new text end new text begin This section expires January 1, 2016. new text end 150.7 new text begin EFFECTIVE DATE. new text end new text begin This section is effective the day following final enactment. new text end 150.8    Sec. 27. new text begin COUNTY SHERIFF TEMPORARY PROVISION; APPLICATION OF new text end 150.9 new text begin POSTRETIREMENT ADJUSTMENT WAITING PERIOD. new text end 150.10     new text begin Subdivision 1. new text end new text begin Application. new text end new text begin Notwithstanding any provision of Minnesota Statutes, new text end 150.11 new text begin section 356.415, subdivision 1c, paragraph (a), to the contrary, this section applies to a new text end 150.12 new text begin county sheriff who: new text end 150.13 new text begin (1) terminates membership in the public employees police and fire retirement plan new text end 150.14 new text begin after June 30, 2014, and by the final day in office in January 2015 as reported by the county; new text end 150.15 new text begin (2) is at least age 50 on the date of membership termination; new text end 150.16 new text begin (3) is at least partially vested under Minnesota Statutes, section 353.01, subdivision new text end 150.17 new text begin 47, and meets all applicable requirements for receipt of a retirement annuity from the new text end 150.18 new text begin public employees police and fire retirement plan; and new text end 150.19 new text begin (4) has as the effective date for the commencement of the retirement annuity the day new text end 150.20 new text begin following the date on which termination of public employees police and fire retirement new text end 150.21 new text begin plan membership occurs. new text end 150.22     new text begin Subd. 2. new text end new text begin Waiting period for initial postretirement adjustment eligibility. new text end new text begin A new text end 150.23 new text begin person to whom subdivision 1 applies is eligible to receive the initial postretirement new text end 150.24 new text begin adjustment under Minnesota Statutes, section 356.415, subdivision 1c, paragraph (a), new text end 150.25 new text begin clause (1) or (2), whichever applies, rather than under Minnesota Statutes, section new text end 150.26 new text begin 356.415, subdivision 1c, paragraph (a), clause (3) or (4). new text end 150.27     new text begin Subd. 3. new text end new text begin Expiration. new text end new text begin This section expires February 2, 2015. new text end 150.28 new text begin EFFECTIVE DATE. new text end new text begin This section is effective the day following final enactment. new text end 150.29    Sec. 28. new text begin REPEALER. new text end 150.30 new text begin Minnesota Statutes 2012, sections 11A.17, subdivision 4; 352.965, subdivision 5; new text end 150.31 new text begin 352D.04, subdivision 1; and 353D.05, subdivision 2, new text end new text begin are repealed. new text end 150.32 new text begin EFFECTIVE DATE. new text end new text begin This section is effective July 1, 2014. new text end 151.1ARTICLE 14 151.2ONE PERSON AND SMALL GROUP RETIREMENT PROVISIONS 151.3    Section 1. new text begin PERA-POLICE AND FIRE; DISABILITY BENEFIT APPLICATION new text end 151.4 new text begin DEADLINE EXTENSION FOR CERTAIN WADENA COUNTY SHERIFF'S new text end 151.5 new text begin DEPUTIES. new text end 151.6 new text begin (a) Notwithstanding any provision of Minnesota Statutes, section 353.031 or new text end 151.7 new text begin 353.656, to the contrary, an eligible person described in paragraph (b) is authorized to new text end 151.8 new text begin file an application for a disability benefit from the public employees police and fire new text end 151.9 new text begin retirement plan retroactively from the date of a shooting event in which the person was new text end 151.10 new text begin involved on March 11, 2006. new text end 151.11 new text begin (b) An eligible person is a person who: new text end 151.12 new text begin (1) was born on August 11, 1971; new text end 151.13 new text begin (2) was initially employed as a deputy sheriff by Wadena County on March 9, 2006; new text end 151.14 new text begin (3) was, by virtue of law enforcement employment, a member of the public new text end 151.15 new text begin employees police and fire retirement plan; new text end 151.16 new text begin (4) was involved in the nonfatal shooting incident of a gun-wielding suspect near new text end 151.17 new text begin Sebelia, Minnesota, on March 11, 2006, without being physically injured; new text end 151.18 new text begin (5) resigned from the Wadena County sheriff's department in October 2010 after new text end 151.19 new text begin being treated for mental health issues for the prior six months; and new text end 151.20 new text begin (6) failed to apply for a mental health-related disability benefit by the November 11, new text end 151.21 new text begin 2007, deadline for applying for a disability benefit from the public employees police and new text end 151.22 new text begin fire retirement plan based on the March 11, 2006, shooting incident. new text end 151.23 new text begin (c) If the eligible person files a disability benefit application under paragraph (a) new text end 151.24 new text begin on or before the expiration date specified in paragraph (d), and if the eligible person is new text end 151.25 new text begin determined by the Public Employees Retirement Association as being disabled while in new text end 151.26 new text begin the line of duty as a result of the March 11, 2006, shooting incident, the eligible person new text end 151.27 new text begin is entitled to receive a duty disability benefit from the public employees police and fire new text end 151.28 new text begin retirement plan under Minnesota Statutes, section 353.656, subdivision 1 or 1a, including new text end 151.29 new text begin retroactive benefit payments from April 1, 2006. new text end 151.30 new text begin (d) The authority for the eligible person to file a disability benefit application under new text end 151.31 new text begin paragraph (a) expires on July 1, 2015. new text end 151.32 new text begin EFFECTIVE DATE. new text end new text begin This section is effective the day following final enactment. new text end 151.33    Sec. 2. new text begin PERMITTING THE PURCHASE OF SALARY CREDIT BY CERTAIN new text end 151.34 new text begin CURRENT AND FORMER CITY OF DULUTH OR DULUTH AIRPORT new text end 152.1 new text begin AUTHORITY EMPLOYEES COVERED BY THE GENERAL EMPLOYEES new text end 152.2 new text begin RETIREMENT PLAN OR THE PUBLIC EMPLOYEES POLICE AND FIRE new text end 152.3 new text begin RETIREMENT PLAN. new text end 152.4     new text begin Subdivision 1. new text end new text begin Authorization. new text end new text begin Due to a Court of Appeals determination that certain new text end 152.5 new text begin salary-supplement payments, provided to certain city of Duluth and Duluth Airport new text end 152.6 new text begin Authority employees and deposited in the employee's deferred compensation account, new text end 152.7 new text begin should have been considered salary for pension purposes, an eligible person is authorized new text end 152.8 new text begin to receive the treatment specified in this section if the eligible person chooses to make the new text end 152.9 new text begin employee contribution equivalent payment specified in this section. new text end 152.10     new text begin Subd. 2. new text end new text begin Eligible person. new text end new text begin (a) An eligible person: new text end 152.11 new text begin (1) is a current or former employee of the city of Duluth or the Duluth Airport new text end 152.12 new text begin Authority, employed by that governmental subdivision between August 1, 2007, and new text end 152.13 new text begin December 31, 2011; new text end 152.14 new text begin (2) was a participating member of the general employees retirement plan of the new text end 152.15 new text begin Public Employees Retirement Association or the public employees police and fire new text end 152.16 new text begin retirement plan for that employment; and new text end 152.17 new text begin (3) had employer-paid amounts made to the person's deferred compensation account new text end 152.18 new text begin for which contributions were not made to the applicable Public Employees Retirement new text end 152.19 new text begin Association plan fund between August 1, 2007, and December 31, 2011, or the date of new text end 152.20 new text begin the employee's termination of public service under Minnesota Statutes, section 353.01, new text end 152.21 new text begin subdivision 11a, whichever is earlier, due to an erroneous application of law under which new text end 152.22 new text begin the Public Employees Retirement Association executive director and board concluded new text end 152.23 new text begin that these employer-paid amounts were not salary for pension purposes under Minnesota new text end 152.24 new text begin Statutes, section 353.01, subdivision 10. new text end 152.25 new text begin (b) A surviving spouse, as defined in this paragraph, is an eligible person for new text end 152.26 new text begin purposes of this section. A surviving spouse means: new text end 152.27 new text begin (1) the surviving spouse of an eligible person as defined in paragraph (a) who, at new text end 152.28 new text begin the time of the eligible person's death, was a deferred annuitant of a Public Employees new text end 152.29 new text begin Retirement Association plan specified in this section; new text end 152.30 new text begin (2) the surviving spouse of an eligible person as defined in paragraph (a) receiving new text end 152.31 new text begin benefits under a joint and survivor annuity from a Public Employees Retirement new text end 152.32 new text begin Association plan specified in this section; or new text end 152.33 new text begin (3) the surviving spouse of an eligible person as defined in paragraph (a) receiving a new text end 152.34 new text begin survivor benefit under Minnesota Statutes, section 353.657. new text end 152.35     new text begin Subd. 3. new text end new text begin Employee contributions. new text end new text begin An eligible person may make payment of an new text end 152.36 new text begin employee contribution equivalent amount to the fund of the general employees retirement new text end 153.1 new text begin plan of the Public Employees Retirement Association or the public employees police new text end 153.2 new text begin and fire retirement plan, whichever provided the coverage. The employee contribution new text end 153.3 new text begin equivalent amount is the amount of employee contributions that would have been made new text end 153.4 new text begin by the employee based on the employer-paid amounts made to the person's deferred new text end 153.5 new text begin compensation account for the period specified in subdivision 2, and the employee new text end 153.6 new text begin contribution rates to the applicable Public Employees Retirement Association plan during new text end 153.7 new text begin that period. If an employee contribution equivalent amount is paid, it must be made in new text end 153.8 new text begin full and in a lump sum. new text end 153.9     new text begin Subd. 4. new text end new text begin Employer contributions. new text end new text begin (a) If an eligible person makes the employee new text end 153.10 new text begin equivalent contribution under subdivision 3, the city of Duluth or the Duluth Airport new text end 153.11 new text begin Authority, whichever is the applicable employing unit, may make the corresponding new text end 153.12 new text begin employer contributions, plus any employer supplemental and employer additional new text end 153.13 new text begin contributions required by law during the applicable time period. new text end 153.14 new text begin (b) Any contributions specified under this subdivision must be based on the new text end 153.15 new text begin employer-paid amounts referred to in subdivision 2, and the contribution rates applicable new text end 153.16 new text begin during the time period for regular employer contributions, and any employer supplemental new text end 153.17 new text begin and employer additional contributions, if applicable. new text end 153.18 new text begin (c) Within 30 days of receipt by the executive director of the Public Employees new text end 153.19 new text begin Retirement Association of employee equivalent contributions under subdivision 3, new text end 153.20 new text begin the executive director shall notify the city of Duluth or the Duluth Airport Authority, new text end 153.21 new text begin whichever is the applicable employer, of amounts due under this subdivision. If the new text end 153.22 new text begin employer chooses to make the payment specified in this subdivision, payment shall be new text end 153.23 new text begin remitted by the applicable employer to the executive director for deposit in the applicable new text end 153.24 new text begin fund within 30 days of notification. If payment is not made in full within that time period, new text end 153.25 new text begin the executive director shall collect the necessary amounts by applying Minnesota Statutes, new text end 153.26 new text begin section 353.28, subdivision 6. new text end 153.27     new text begin Subd. 5. new text end new text begin Benefit adjustments. new text end new text begin Upon receipt of the applicable employee equivalent new text end 153.28 new text begin contribution under subdivision 3 from an eligible person, the executive director shall new text end 153.29 new text begin revise the records of the Public Employees Retirement Association and grant the person new text end 153.30 new text begin the additional salary credit. If a retirement, disability, or survivor annuity has commenced, new text end 153.31 new text begin the executive director must adjust the benefit being paid to include in the calculation the new text end 153.32 new text begin additional salary on which contributions were paid, and the adjusted benefit must be paid new text end 153.33 new text begin retroactive from the effective date of the initial benefit payment under the annuity. new text end 153.34     new text begin Subd. 6. new text end new text begin Restrictions. new text end new text begin This section does not apply if service credit and other rights new text end 153.35 new text begin under the plan were forfeited by taking a refund. new text end 154.1     new text begin Subd. 7. new text end new text begin Treatment of interest. new text end new text begin Notwithstanding any provision in Minnesota new text end 154.2 new text begin Statutes, chapter 353, to the contrary, all payments specified in this section made by an new text end 154.3 new text begin eligible person to the executive director for deposit in the applicable Public Employees new text end 154.4 new text begin Retirement Association fund are to be made without interest. Any payments required from new text end 154.5 new text begin the employer under this section are also without interest, provided the employer makes new text end 154.6 new text begin the payment to the executive director within 30 days of notification. Interest shall be new text end 154.7 new text begin charged, as specified in Minnesota Statutes, section 353.28, on any employer obligations new text end 154.8 new text begin not paid within the 30-day period. new text end 154.9     new text begin Subd. 8. new text end new text begin Notification; counseling. new text end new text begin The executive director shall notify all active new text end 154.10 new text begin members, deferred members, retirees, and survivors to whom this section may apply and new text end 154.11 new text begin shall provide counseling regarding the implications of this section, including payment new text end 154.12 new text begin requirements and likely adjustments in current or future benefit amounts if employee new text end 154.13 new text begin equivalent contributions as specified in this section are made. new text end 154.14     new text begin Subd. 9. new text end new text begin Expiration of salary credit purchase authority. new text end new text begin Payment of employee new text end 154.15 new text begin contribution equivalent amounts, as authorized under this section, is prohibited after new text end 154.16 new text begin October 31, 2014. new text end 154.17     new text begin Subd. 10. new text end new text begin Ratification. new text end new text begin Actions taken before the effective date of this section by new text end 154.18 new text begin the executive director and board of the Public Employees Retirement Association, the new text end 154.19 new text begin city of Duluth, the Duluth Airport Authority, and eligible persons which are otherwise new text end 154.20 new text begin consistent with this section are ratified. new text end 154.21 new text begin EFFECTIVE DATE. new text end new text begin This section is effective the day following final enactment. new text end 154.22    Sec. 3. new text begin PERA-GENERAL; HENNEPIN COUNTY ELECTED SERVICE new text end 154.23 new text begin CREDIT PURCHASE. new text end 154.24 new text begin (a) Notwithstanding any provision of Minnesota Statutes, chapters 353 and 353D, new text end 154.25 new text begin or other law to the contrary, an eligible person described in paragraph (b) is entitled to new text end 154.26 new text begin purchase allowable service credit from the coordinated program of the general employees new text end 154.27 new text begin retirement plan of the Public Employees Retirement Association for the period of service new text end 154.28 new text begin as an elected county commissioner for Hennepin County that is not otherwise covered new text end 154.29 new text begin under Minnesota Statutes, chapter 353, if the eligible person makes the payment required new text end 154.30 new text begin under paragraph (d). new text end 154.31 new text begin (b) An eligible person is a person who: new text end 154.32 new text begin (1) was born on November 18, 1946; and new text end 154.33 new text begin (2) was first elected as a Hennepin County commissioner in November 1978 and new text end 154.34 new text begin was sworn in as a commissioner on January 2, 1979. new text end 155.1 new text begin (c) If the eligible person described in paragraph (b) elects to participate in the general new text end 155.2 new text begin employees retirement plan of the Public Employees Retirement Association governed by new text end 155.3 new text begin Minnesota Statutes, chapter 353, effective on the first day of the month next following the new text end 155.4 new text begin effective date of this section, the eligible person may apply to the executive director of new text end 155.5 new text begin the Public Employees Retirement Association to make the service credit purchase under new text end 155.6 new text begin this section. The application must be in writing and must be accompanied with necessary new text end 155.7 new text begin documentation of the applicability of this section and of any other relevant information new text end 155.8 new text begin that the executive director may require. new text end 155.9 new text begin (d) Allowable service credit under Minnesota Statutes, section 353.01, subdivision new text end 155.10 new text begin 16, must be granted by the coordinated program of the general employees retirement plan new text end 155.11 new text begin of the Public Employees Retirement Association to the eligible person upon the receipt new text end 155.12 new text begin of the prior service credit purchase payment amount required under Minnesota Statutes, new text end 155.13 new text begin section 356.551. The payment obligation must be offset first by a transfer of the account new text end 155.14 new text begin balance to the credit of the eligible person from the defined contribution plan of the Public new text end 155.15 new text begin Employees Retirement Association. If that transfer is insufficient, the balance of the new text end 155.16 new text begin service credit purchase payment may be made from amounts to the credit of the eligible new text end 155.17 new text begin person under Minnesota Statutes, section 352.965 or 383B.46. new text end 155.18 new text begin (e) If, before July 1, 2018, the interest rate actuarial assumption, the mortality new text end 155.19 new text begin actuarial assumption, or both actuarial assumptions of the general employees retirement new text end 155.20 new text begin plan of the Public Employees Retirement Association are modified and the net result of new text end 155.21 new text begin any modification is to increase the actuarial accrued liability of the retirement plan, the new text end 155.22 new text begin eligible person, as a condition of a continued receipt of an annuity from the retirement new text end 155.23 new text begin plan, shall reimburse the retirement fund for the amount of the increase in required new text end 155.24 new text begin reserves for the annuity, determined as the difference between the present value of the new text end 155.25 new text begin annuity on the effective date of the assumption change or changes before the assumption new text end 155.26 new text begin change or changes and after the assumption change or changes. The executive director new text end 155.27 new text begin shall certify the amount due, if any, to the eligible person and payment is due 30 days later. new text end 155.28 new text begin (f) Authority for an eligible person to make the prior service credit purchase new text end 155.29 new text begin under this section expires on December 31, 2015, or upon the termination of service as new text end 155.30 new text begin a Hennepin County commissioner, whichever is earlier. new text end 155.31 new text begin EFFECTIVE DATE. new text end new text begin This section is effective the day following final enactment. new text end 155.32    Sec. 4. new text begin PERA-P&F; MILLE LACS BAND PRIOR SERVICE CREDIT new text end 155.33 new text begin PURCHASE AUTHORIZED. new text end 156.1 new text begin (a) An eligible person described in paragraph (b) is entitled to purchase allowable new text end 156.2 new text begin service credit in the public employees police and fire retirement plan for the period new text end 156.3 new text begin specified in paragraph (c) by remitting the payment calculated under paragraph (d). new text end 156.4 new text begin (b) An eligible person is a person who: new text end 156.5 new text begin (1) was born on June 28, 1966; new text end 156.6 new text begin (2) was initially employed as a full-time police officer by the Mille Lacs tribal new text end 156.7 new text begin police department on October 29, 1998; new text end 156.8 new text begin (3) was initially employed as a part-time police officer by the city of Onamia on new text end 156.9 new text begin July 28, 2002; new text end 156.10 new text begin (4) was initially employed as a part-time police officer by the city of Pierz on March new text end 156.11 new text begin 14, 2013; and new text end 156.12 new text begin (5) is an active member of the public employees police and fire retirement plan. new text end 156.13 new text begin (c) The period of Mille Lacs tribal police department employment available for new text end 156.14 new text begin purchase is the two-year period of Mille Lacs tribal police department employment new text end 156.15 new text begin immediately preceding initial active membership in the public employees police and fire new text end 156.16 new text begin retirement plan in that capacity. new text end 156.17 new text begin (d) The full actuarial value prior service credit purchase payment amount must be new text end 156.18 new text begin calculated under Minnesota Statutes, section 356.551. new text end 156.19 new text begin (e) The eligible person must provide the executive director of the Public Employees new text end 156.20 new text begin Retirement Association with any relevant requested information pertaining to the service new text end 156.21 new text begin credit purchase. new text end 156.22 new text begin (f) Authority to make a service credit purchase under this section expires on June 30, new text end 156.23 new text begin 2015, or upon the eligible person's termination from public employment as defined under new text end 156.24 new text begin Minnesota Statutes, section 353.01, subdivision 11a, whichever occurs earlier. new text end 156.25 new text begin EFFECTIVE DATE. new text end new text begin This section is effective the day following final enactment. new text end 156.26    Sec. 5. new text begin TEACHERS RETIREMENT ASSOCIATION; PROSPECTIVE new text end 156.27 new text begin TEACHERS RETIREMENT ASSOCIATION COVERAGE; PURCHASE OF new text end 156.28 new text begin PAST SERVICE CREDIT. new text end 156.29     new text begin (a) An eligible person described in paragraph (b) is authorized to become a new text end 156.30 new text begin coordinated member of the Teachers Retirement Association and to purchase service new text end 156.31 new text begin and salary credit in the Teachers Retirement Association coordinated plan retroactively new text end 156.32 new text begin from January 1, 1995, upon making an election under paragraph (c) and upon making all new text end 156.33 new text begin required payments under paragraphs (d) and (e). new text end 156.34     new text begin (b) An eligible person is a person who: new text end 156.35     new text begin (1) was born on October 29, 1957; new text end 157.1     new text begin (2) has been employed at Mesabi Range Community and Technical College as new text end 157.2 new text begin an instructor since 1993; new text end 157.3     new text begin (3) in 1994 was classified in the unlimited part-time category; new text end 157.4     new text begin (4) became eligible for and was covered by the higher education individual new text end 157.5 new text begin retirement account plan in January 1994; and new text end 157.6     new text begin (5) was not offered an election of Teachers Retirement Association coverage, as new text end 157.7 new text begin required under Laws 1994, chapter 508, article 1, section 10. new text end 157.8     new text begin (c) To be eligible for coverage by the Teachers Retirement Association, an eligible new text end 157.9 new text begin person must submit a written application to the executive director of the Teachers new text end 157.10 new text begin Retirement Association on a form provided by the Teachers Retirement Association. The new text end 157.11 new text begin application must include all documentation of the applicability of this section and any new text end 157.12 new text begin other relevant information that the executive director may require. Teachers Retirement new text end 157.13 new text begin Association plan membership commences as of September 1, 2014, for an applicable new text end 157.14 new text begin eligible person, and past salary and service credit is granted from January 1, 1995, new text end 157.15 new text begin as specified in this section, following receipt by the executive director of the written new text end 157.16 new text begin application specified in this paragraph and receipt of the payments specified in paragraphs new text end 157.17 new text begin (d) and (e). The authority granted by this section is voided if the applicable eligible new text end 157.18 new text begin individual terminates from Minnesota State Colleges and Universities system employment new text end 157.19 new text begin prior to receipt by the executive director of the Teachers Retirement Association of the new text end 157.20 new text begin application specified in this paragraph and amounts specified in paragraphs (d) and (e). new text end 157.21 new text begin Coverage by the Teachers Retirement Association is in lieu of coverage by the individual new text end 157.22 new text begin retirement account plan. new text end 157.23     new text begin (d) If an eligible person makes an election under paragraph (c), the eligible person new text end 157.24 new text begin shall make, before September 1, 2014, a contribution equal to the excess, if any, of the new text end 157.25 new text begin employee contributions that the individual would have made if the Teachers Retirement new text end 157.26 new text begin Association had provided coverage from January 1, 1995, rather than the individual new text end 157.27 new text begin retirement account plan. These additional contribution amounts shall include 8.5 percent new text end 157.28 new text begin annual compound interest computed from the date the contribution would have been made new text end 157.29 new text begin if deducted from salary until paid. The total amount to be paid under this paragraph shall new text end 157.30 new text begin be determined by the executive director of the Teachers Retirement Association and new text end 157.31 new text begin written notification of the amount required under this paragraph should be transmitted new text end 157.32 new text begin to the eligible individual. new text end 157.33     new text begin (e) If payment is made under paragraph (d), the value of the applicable eligible new text end 157.34 new text begin person's higher education individual retirement account plan account shall be determined new text end 157.35 new text begin as of September 1, 2014, and that account value shall be transferred to the Teachers new text end 157.36 new text begin Retirement Association on or before September 15, 2014. new text end 158.1     new text begin (f) The Teachers Retirement Association shall determine the full actuarial value new text end 158.2 new text begin imposed upon the Teachers Retirement Association under this section due to the salary new text end 158.3 new text begin and service credit purchase. new text end 158.4     new text begin (g) From the total amount computed under paragraph (f), the executive director of the new text end 158.5 new text begin Teachers Retirement Association shall subtract the amounts received under paragraphs (d) new text end 158.6 new text begin and (e). The Minnesota State Colleges and Universities system is authorized to transmit the new text end 158.7 new text begin remaining amount, if any, to the executive director of the Teachers Retirement Association. new text end 158.8     new text begin (h) Any payment amount specified from the Minnesota State Colleges and new text end 158.9 new text begin Universities system under paragraph (g) shall be transmitted to the Teachers Retirement new text end 158.10 new text begin Association within one month following receipt of amounts transmitted under paragraphs new text end 158.11 new text begin (d) and (e), and following notification from the executive director of the Teachers new text end 158.12 new text begin Retirement Association. If a payment from the Minnesota State Colleges and Universities new text end 158.13 new text begin system specified under paragraph (g) is not made, the executive director of the Teachers new text end 158.14 new text begin Retirement Association must notify the commissioner of Minnesota Management and new text end 158.15 new text begin Budget of this fact and that commissioner must order that amounts specified under new text end 158.16 new text begin paragraph (g) shall be deducted from appropriations or state aid to the Minnesota new text end 158.17 new text begin State Colleges and Universities system and be transmitted to the Teachers Retirement new text end 158.18 new text begin Association. new text end 158.19 new text begin EFFECTIVE DATE. new text end new text begin This section is effective the day following final enactment. new text end