1.1 	A bill for an act
1.2 	relating to retirement; reducing the actuarial assumption for investment rate of 
1.3 	return; eliminating the delay to normal retirement age on the commencement of 
1.4 	postretirement adjustments and reducing the vesting requirement for the general 
1.5 	employees retirement plans of the Minnesota State Retirement System and the 
1.6 	Public Employees Retirement Association; modifying the postretirement adjustment 
1.7 	for the local government correctional service retirement plan; providing a onetime 
1.8 	postretirement adjustment to all pension plan members; temporarily reducing the 
1.9 	employee contribution rate for the general state employees retirement plan; 
1.10 	modifying the expiration date for supplemental employer contributions to the State 
1.11 	Patrol and correctional state employees plans and for the state aid to the judges 
1.12 	plan; providing for an unreduced retirement annuity upon reaching age 62 with 
1.13 	30 years of service and increasing the employee contribution rate for the St. Paul 
1.14 	Teachers Retirement Fund Association; appropriating money for onetime direct 
1.15 	state aids to the pension plans, an incentive program for paying monetary incentives 
1.16 	to join the statewide volunteer firefighter plan, and the Legislative Commission 
1.17 	on Pensions and Retirement for actuarial services to assess the actuarial cost of 
1.18 	pension legislation;amending Minnesota Statutes 2022, sections 352.04, 
1.19 	subdivision 2; 352.115, subdivision 1; 352.92, subdivision 2a; 352B.02, subdivision 
1.20 	1c; 353.01, subdivision 47; 354A.12, subdivision 1; 354A.31, subdivision 7, by 
1.21 	adding a subdivision; 356.215, subdivision 8; 356.415, subdivisions 1, 1b, 1g; 
1.22 	356.59; 490.123, subdivision 5.
1.23 	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

1.24 	ARTICLE 1
1.25 	REDUCTION OF INTEREST RATES

1.26 	Section 1. Minnesota Statutes 2022, section 356.215, subdivision 8, is amended to read:
1.27 		Subd. 8.Actuarial assumptions. (a) The actuarial valuation must use the applicable 
1.28 	following investment return assumption:

2.22.1
	plan
	investment return 
assumption
		
2.3	general state employees retirement plan
	7.5% 7%
		
2.4	correctional state employees retirement plan
	7.5 7
		
2.5	State Patrol retirement plan
	7.5 7
		
2.6
2.7
2.8	legislators retirement plan, and for the 
constitutional officers calculation of total plan 
liabilities
	0
		
2.9	judges retirement plan
	7.5 7
		
2.10	general public employees retirement plan
	7.5 7
		
2.11	public employees police and fire retirement plan
	7.5 7
		
2.12
2.13	local government correctional service retirement 
plan
	7.5 7
		
2.14	teachers retirement plan
	7.5 7
		
2.15	St. Paul teachers retirement plan
	7.5 7
		
2.16	Bloomington Fire Department Relief Association
	6
		
2.17
2.18	local monthly benefit volunteer firefighter relief 
associations
	5
		
2.19
2.20	monthly benefit retirement plans in the statewide 
volunteer firefighter retirement plan
	6
		
2.21 	(b) The actuarial valuation for each of the covered retirement plans listed in section 
2.22 	356.415, subdivision 2, and the St. Paul Teachers Retirement Fund Association must take 
2.23 	into account the postretirement adjustment rate or rates applicable to the plan as specified 
2.24 	in section 354A.29, subdivision 7, or 356.415, whichever applies.
2.25 	(c) The actuarial valuation must use the applicable salary increase and payroll growth 
2.26 	assumptions found in the appendix to the standards for actuarial work adopted by the 
2.27 	Legislative Commission on Pensions and Retirement pursuant to section 3.85, subdivision 
2.28 	10. The appendix must be updated whenever new assumptions have been approved or 
2.29 	deemed approved under subdivision 18.
2.30 	(d) The assumptions set forth in the appendix to the standards for actuarial work continue 
2.31 	to apply, unless a different salary assumption or a different payroll increase assumption:
2.32 	(1) has been proposed by the governing board of the applicable retirement plan;
2.33 	(2) is accompanied by the concurring recommendation of the actuary retained under 
2.34 	section 356.214, subdivision 1, if applicable, or by the approved actuary preparing the most 
2.35 	recent actuarial valuation report if section 356.214 does not apply; and
2.36 	(3) has been approved or deemed approved under subdivision 18.

2.37 	EFFECTIVE DATE. This section is effective June 30, 2023.

3.1 	Sec. 2. Minnesota Statutes 2022, section 356.59, is amended to read:
3.2 	356.59 INTEREST RATES.
3.3 		Subdivision 1.Applicable interest rates. Whenever the payment of interest is required 
3.4 	with respect to any payment, including refunds, remittances, shortages, contributions, or 
3.5 	repayments, the rate of interest is the rate or rates specified in subdivisions 2 to 5 for each 
3.6 	public retirement plan.
3.7 		Subd. 2.Minnesota State Retirement System. The interest rates for all retirement plans 
3.8 	administered by the Minnesota State Retirement System are as follows:

3.9				Annual
		Monthly
	
3.10		before July 1, 2015
	8.5 percent
	0.71 percent
	
3.11		from July 1, 2015, to June 30, 2018
	8.0 percent
	0.667 percent
	
3.12
3.13		after June 30 from July 1, 2018, to June 
30, 2023
	7.5 percent
	0.625 percent
	
3.14		after June 30, 2023
	7.0 percent
	0.583 percent
	
3.15 		Subd. 3.Public Employees Retirement Association. The interest rates for all retirement 
3.16 	plans administered by the Public Employees Retirement Association are as follows:

3.17		before July 1, 2015
	8.5 percent
		
3.18		from July 1, 2015, to June 30, 2018
	8.0 percent
		
3.19
3.20		after June 30 from July 1, 2018, to June 
30, 2023
	7.5 percent
		
3.21		after June 30, 2023
	7.0 percent
		
3.22 		Subd. 4.Teachers Retirement Association. The interest rates for the retirement plan 
3.23 	administered by the Teachers Retirement Association are as follows:

3.24				Annual
		Monthly
	
3.25		before July 1, 2018
	8.5 percent
	0.71 percent
	
3.26
3.27		after June 30 from July 1, 2018, to June 
30, 2023
	7.5 percent
	0.625 percent
	
3.28		after June 30, 2023
	7.0 percent
	0.583 percent
	
3.29 		Subd. 5.St. Paul Teachers Retirement Fund Association. The interest rates for the 
3.30 	retirement plan administered by the St. Paul Teachers Retirement Fund Association are as 
3.31 	follows:

3.32				Annual
		Monthly
	
3.33		before July 1, 2015
	8.5 percent
	0.71 percent
	
3.34		from July 1, 2015, to June 30, 2018
	8.0 percent
	0.667 percent
	
4.1
4.2		after June 30 from July 1, 2018, to June 
30, 2023
	7.5 percent
	0.625 percent
	
4.3		after June 30, 2023
	7.0 percent
	0.583 percent

4.4 	EFFECTIVE DATE. This section is effective June 30, 2023.

4.5 	ARTICLE 2
4.6 	COLAS

4.7 	Section 1. Minnesota Statutes 2022, section 356.415, subdivision 1, is amended to read:
4.8 		Subdivision 1.Annual postretirement adjustments; Minnesota State Retirement 
4.9 	System general state employees retirement plan, legislators retirement plan, and 
4.10 	unclassified state employees retirement program. (a) Except as set forth in paragraph 
4.11 	(c), Recipients of a retirement annuity, disability benefit, or survivor benefit from the general 
4.12 	state employees retirement plan, the legislators retirement plan, or the unclassified state 
4.13 	employees retirement program are entitled to an annual postretirement adjustment, effective 
4.14 	as of each January 1, as follows:
4.15 	(1) effective January 1, 2019, through December 31, 2023, a postretirement increase of 
4.16 	one percent must be applied each year to the amount of the monthly annuity or benefit of 
4.17 	each annuitant or benefit recipient who has been receiving an annuity or a benefit for at 
4.18 	least 12 full months as of the June 30 of the calendar year immediately before the adjustment;
4.19 	(2) effective January 1, 2019, through December 31, 2023, for each annuitant or benefit 
4.20 	recipient who has been receiving an annuity or a benefit for at least one full month, but less 
4.21 	than 12 full months as of the June 30 of the calendar year immediately before the adjustment, 
4.22 	a postretirement increase of 1/12 of one percent for each month that the person has been 
4.23 	receiving an annuity or benefit must be applied to the amount of the monthly annuity or 
4.24 	benefit of the annuitant or benefit recipient;
4.25 	(3) effective January 1, 2024, and thereafter, a postretirement increase of 1.5 percent 
4.26 	must be applied each year to the amount of the monthly annuity or benefit of each annuitant 
4.27 	or benefit recipient who has been receiving an annuity or a benefit for at least 12 full months 
4.28 	as of the June 30 of the calendar year immediately before the adjustment; and
4.29 	(4) effective January 1, 2024, and thereafter, for each annuitant or benefit recipient who 
4.30 	has been receiving an annuity or a benefit for at least one full month, but less than 12 full 
4.31 	months as of the June 30 of the calendar year immediately before the adjustment, an annual 
4.32 	postretirement increase of 1/12 of 1.5 percent for each month that the person has been 
5.1 	receiving an annuity or benefit must be applied to the amount of the monthly annuity or 
5.2 	benefit of the annuitant or benefit recipient.
5.3 	(b) An increase in annuity or benefit payments under this subdivision must be made 
5.4 	automatically unless written notice is filed by the annuitant or benefit recipient with the 
5.5 	executive director of the covered retirement plan requesting that the increase not be made.
5.6 	(c) Members who retire on or after January 1, 2024, under the general state employees 
5.7 	retirement plan, the legislators retirement plan, or the unclassified state employees retirement 
5.8 	program are entitled to an annual postretirement adjustment of the member's retirement 
5.9 	annuity, effective as of each January 1, beginning with the year following the year in which 
5.10 	the member attains normal retirement age, as follows:
5.11 	(1) if a member has been receiving an annuity for at least 12 full months as of the June 
5.12 	30 of the calendar year immediately before the date of the adjustment, a postretirement 
5.13 	increase equal to the percentage specified in paragraph (a), clause (3), must be applied, 
5.14 	effective on January 1, to the amount of the member's monthly annuity;
5.15 	(2) if a member has been receiving an annuity for at least one full month, but less than 
5.16 	12 full months as of the June 30 of the calendar year immediately before the date of 
5.17 	adjustment, a postretirement increase of 1/12 of the percentage specified in paragraph (a), 
5.18 	clause (4), for each month that the member has been receiving an annuity must be applied, 
5.19 	effective on January 1, to the amount of the member's monthly annuity; or
5.20 	(3) if a member has been receiving an annuity for fewer than seven months before the 
5.21 	date of adjustment, a postretirement increase shall not be applied until the next January 1 
5.22 	and the amount of the adjustment shall be the amount determined under clause (2).
5.23 	(d) Paragraph (c) does not apply to members who retire under section 352.116, 
5.24 	subdivision 1, paragraph (c).

5.25 	Sec. 2. Minnesota Statutes 2022, section 356.415, subdivision 1b, is amended to read:
5.26 		Subd. 1b.Annual postretirement adjustments; PERA; general employees retirement 
5.27 	plan. (a) Annuities, disability benefits, and survivor benefits being paid from the general 
5.28 	employees retirement plan of the Public Employees Retirement Association shall be increased 
5.29 	effective each January 1 by the percentage of increase determined under this subdivision. 
5.30 	The increase to the annuity or benefit shall be determined by multiplying the monthly amount 
5.31 	of the annuity or benefit by the percentage of increase specified in paragraph (b), after taking 
5.32 	into account any reduction to the percentage of increase required under paragraph (c).
6.1 	(b) The percentage of increase shall be one percent unless the federal Social Security 
6.2 	Administration has announced a cost-of-living adjustment pursuant to United States Code, 
6.3 	title 42, section 415(i), in the last quarter of the preceding calendar year that is greater than 
6.4 	two percent. If the cost-of-living adjustment announced by the federal Social Security 
6.5 	Administration is greater than two percent, the percentage of increase shall be 50 percent 
6.6 	of the cost-of-living adjustment announced by the federal Social Security Administration, 
6.7 	but in no event may the percentage of increase exceed 1.5 percent.
6.8 	(c)(1) If the recipient of an annuity, disability benefit, or survivor's benefit has been 
6.9 	receiving the annuity or benefit for at least 12 full months as of the June 30 of the calendar 
6.10 	year immediately before the effective date of the increase, there is no reduction in the 
6.11 	percentage of increase.
6.12 	(2) If the recipient of an annuity, disability benefit, or survivor's benefit has been receiving 
6.13 	the annuity or benefit for at least one month, but less than 12 full months, as of the June 30 
6.14 	of the calendar year immediately preceding the effective date of the increase, the percentage 
6.15 	of increase is multiplied by a fraction, the numerator of which is the number of months the 
6.16 	annuity or benefit was received as of June 30 of the preceding calendar year and the 
6.17 	denominator of which is 12.
6.18 	(d) Effective for members who retire on or after January 1, 2024, annuities shall not be 
6.19 	increased under paragraphs (a) to (c) until January 1 of the year following the year in which 
6.20 	the member reaches normal retirement age. January 1 of the year following the year in 
6.21 	which the member reaches normal retirement age shall be considered the effective date of 
6.22 	the increase under paragraph (c). If a member has been receiving an annuity for fewer than 
6.23 	seven months as of the January 1 of the year following the year in which the member reaches 
6.24 	normal retirement age, no increase shall be paid until January 1 of the next year.
6.25 	(e)(d) An increase in annuity or benefit payments under this section must be made 
6.26 	automatically unless written notice is filed by the recipient with the executive director of 
6.27 	the Public Employees Retirement Association requesting that the increase not be made.
6.28 	(f) Paragraph (d) does not apply to members who retire under section 353.30, subdivision 
6.29 	1a.

6.30 	Sec. 3. Minnesota Statutes 2022, section 356.415, subdivision 1g, is amended to read:
6.31 		Subd. 1g.Annual postretirement adjustments; PERA local government correctional 
6.32 	retirement plan. (a) Annuities, disability benefits, and survivor benefits being paid from 
6.33 	the local government correctional retirement plan of the Public Employees Retirement 
7.1 	Association shall be increased effective each January 1 by the percentage of increase 
7.2 	determined under this subdivision. The increase to the annuity or benefit shall be determined 
7.3 	by multiplying the monthly amount of the annuity or benefit by the percentage of increase 
7.4 	specified in paragraph (b), after taking into account any reduction to the percentage of 
7.5 	increase required under paragraph (c) (d).
7.6 	(b) As of each January 1, the percentage of increase shallmust be one percent unless 
7.7 	the federal Social Security Administration has announced a cost-of-living adjustment 
7.8 	pursuant to United States Code, title 42, section 415(i), in the last quarter of the preceding 
7.9 	calendar year that is greater than one percent. If the cost-of-living adjustment announced 
7.10 	by the federal Social Security Administration is greater than one percent, the percentage of 
7.11 	increase shallmust be the same as the cost-of-living adjustment announced by the federal 
7.12 	Social Security Administration, but in no event may the percentage of increase exceed the 
7.13 	applicable maximum percentage in effect on January 1 under paragraph (c).
7.14 	(c) The applicable maximum percentage in effect on January 1 is 2.5 percent, untilunless 
7.15 	either of the following occurs is true, in which case the applicable maximum percentage is 
7.16 	1.5 percent and remains at 1.5 percent thereafter:
7.17 	(1) the market value of assets equals or is less than 85 percent of the actuarial accrued 
7.18 	liabilities as reported by the plan's actuary in the most recent two consecutive annual actuarial 
7.19 	valuations; or
7.20 	(2) the market value of assets equals or is less than 80 percent of the actuarial accrued 
7.21 	liabilities as reported by the plan's actuary in the most recent annual actuarial valuation. If, 
7.22 	on January 1 after a year during which the applicable maximum percentage was 1.5 percent, 
7.23 	neither clause (1) or (2) is true, then the applicable maximum percentage is 2.5 percent.
7.24 	(c) (d)(1) If the recipient of an annuity, disability benefit, or survivor's benefit has been 
7.25 	receiving the annuity or benefit for at least 12 full months as of the June 30 of the calendar 
7.26 	year immediately before the effective date of the increase, there is no reduction in the 
7.27 	percentage of increase.
7.28 	(2) If the recipient of an annuity, disability benefit, or survivor's benefit has been receiving 
7.29 	the annuity or benefit for at least one month, but less than 12 full months, as of the June 30 
7.30 	of the calendar year immediately preceding the effective date of the increase, the percentage 
7.31 	of increase is multiplied by a fraction, the numerator of which is the number of months the 
7.32 	annuity or benefit was received as of June 30 of the preceding calendar year and the 
7.33 	denominator of which is 12.
8.1 	(d)(e) An increase in annuity or benefit payments under this section must be made 
8.2 	automatically unless written notice is filed by the recipient with the executive director of 
8.3 	the Public Employees Retirement Association requesting that the increase not be made.

8.4 	Sec. 4. POSTRETIREMENT ADJUSTMENT FOR CALENDAR YEAR 2024 FOR 
8.5 	COORDINATED MEMBERS.
 8.6 	(a) Notwithstanding Minnesota Statutes, sections 354A.29, subdivision 7, and 356.415, 
8.7 	subdivisions 1 to 1b, 1d, and 1f, the postretirement adjustment for the year beginning January 
8.8 	1, 2024, and ending December 31, 2024, must be 2.5 percent for eligible recipients of a 
8.9 	retirement annuity, disability benefit, or survivor benefit from the Minnesota State Retirement 
8.10 	System, Public Employees Retirement Association, Teachers Retirement Association, or 
8.11 	St. Paul Teachers Retirement Fund Association.
8.12 	(b) A recipient is an eligible recipient if:
8.13 	(1) the recipient's annuity or benefit is attributable to service as a member of the legislators 
8.14 	plan, as a coordinated member of a pension plan administered by the Minnesota State 
8.15 	Retirement System, Public Employees Retirement Association, Teachers Retirement 
8.16 	Association, or the St. Paul Teachers Retirement Fund Association, and is not from the 
8.17 	public employees police and fire plan or the State Patrol retirement plan; and
8.18 	(2) the recipient has received monthly benefits for at least 12 full months as of June 30, 
8.19 	2023.
8.20 	(c) This adjustment must not be compounded and is in effect for calendar year 2024 
8.21 	only.
8.22 	(d) The increase in excess of the current statutory postretirement adjustment for calendar 
8.23 	year 2024 must be distributed to each recipient in a lump sum payment as soon as 
8.24 	administratively practicable but no later than March 31, 2024.

8.25 	Sec. 5. POSTRETIREMENT ADJUSTMENT FOR CALENDAR YEAR 2024 FOR 
8.26 	BASIC MEMBERS.
 8.27 	(a) Notwithstanding Minnesota Statutes, sections 354A.29, subdivision 7, and 356.415, 
8.28 	subdivisions 1b to 1e, the postretirement adjustment for the year beginning January 1, 2024, 
8.29 	and ending December 31, 2024, must be four percent for eligible recipients of a retirement 
8.30 	annuity, disability benefit, or survivor benefit from the Minnesota State Retirement System, 
8.31 	Public Employees Retirement Association, Teachers Retirement Association, or St. Paul 
8.32 	Teachers Retirement Fund Association.
9.1 	(b) A recipient is an eligible recipient if:
9.2 	(1) the recipient's annuity or benefit is attributable to service as a basic member of the 
9.3 	Public Employees Retirement Association general employees retirement plan, the Teachers 
9.4 	Retirement Association, or the St. Paul Teachers Retirement Fund Association or is an 
9.5 	annuity or benefit from the public employees police and fire plan or the State Patrol 
9.6 	retirement plan; and
9.7 	(2) the recipient has received monthly benefits for at least twelve full months as of June 
9.8 	30, 2023.
9.9 	(c) This adjustment must not be compounded and is in effect for calendar year 2024 
9.10 	only.
9.11 	(d) The increase in excess of the current statutory postretirement adjustment for calendar 
9.12 	year 2024 must be distributed to each recipient in a lump sum payment as soon as 
9.13 	administratively practicable but no later than March 31, 2024. For the purpose of providing 
9.14 	a postretirement adjustment for members of the public employees police and fire plan who 
9.15 	have received monthly benefits for at least 12 full months as of June 30, 2023, but have not 
9.16 	yet begun to receive a postretirement adjustment, the increase in excess of the current 
9.17 	statutory postretirement adjustment for calendar year 2024 is three percent.

9.18 	ARTICLE 3
9.19 	MINNESOTA STATE RETIREMENT SYSTEM

9.20 	Section 1. Minnesota Statutes 2022, section 352.04, subdivision 2, is amended to read:
9.21 		Subd. 2.Employee contributions. (a) The employee contribution to the fund must be 
9.22 	equal to the following percent of salary:

9.23		from July 1, 2014, to June 30, 2018
	5.5
	
9.24		from July 1, 2018, to June 30, 2019
	5.75
	
9.25		after June 30 from July 1, 2019, to June 30, 2023
	6
	
9.26		from July 1, 2023, to June 30, 2025
	5.5
	
9.27		after June 30, 2025
	6
	
9.28 	(b) These contributions must be made by deduction from salary as provided in subdivision 
9.29 	4.
9.30 	(c) Contribution increases under paragraph (a) must be paid starting the first day of the 
9.31 	first full pay period after the effective date of the increase.

10.1 	Sec. 2. Minnesota Statutes 2022, section 352.115, subdivision 1, is amended to read:
10.2 		Subdivision 1.Age and service requirements. After separation from state service, any 
10.3 	employee (1) who has attained the age of at least 55 years and who is entitled, upon 
10.4 	application, to a retirement annuity if the employee:
10.5 	(1) has received credit for at least three years of allowable service ifand was employed 
10.6 	before July 1, 2010, or after;
10.7 	(2) has received credit for at least five or more years of allowable service if employed 
10.8 	after June 30, 2010, or (2) whoand terminated employment before July 1, 2023;
10.9 	(3) was actively employed on July 1, 2023, and has earned three years of allowable 
10.10 	service prior to the employee's retirement application;
10.11 	(4) has three or more years of allowable service if employed after June 30, 2023; or
10.12 	(5) has received credit for at least 30 years of allowable service regardless of age, is 
10.13 	entitled upon application to a retirement annuity.

10.14 	Sec. 3. Minnesota Statutes 2022, section 352.92, subdivision 2a, is amended to read:
10.15 		Subd. 2a.Supplemental employer contribution. (a) Effective July 1, 2019, the employer 
10.16 	shall pay a supplemental contribution. The supplemental contribution is 1.45 percent of 
10.17 	salary for covered correctional employees from July 1, 2019, through June 30, 2020; 2.95 
10.18 	percent of salary for covered correctional employees from July 1, 2020, through June 30, 
10.19 	2021; and 4.45 percent of salary for covered correctional employees thereafter. The 
10.20 	supplemental contribution rate of 4.45 percent remains in effect until, for three consecutive 
10.21 	years, the market value of the assets of the correctional state employees retirement plan of 
10.22 	the Minnesota State Retirement System equals or exceeds the actuarial accrued liability of 
10.23 	the plan as determined by the actuary retained under section 356.214. The expiration of the 
10.24 	supplemental employer contribution is effective the first day of the first full pay period of 
10.25 	the fiscal year immediately following the issuance of the third actuarial valuation upon 
10.26 	which the expiration is based.
10.27 	(b) The supplemental contribution under paragraph (a) must be paid starting the first 
10.28 	day of the first full pay period after June 30, 2018.

10.29 	Sec. 4. Minnesota Statutes 2022, section 352B.02, subdivision 1c, is amended to read:
10.30 		Subd. 1c.Employer contributions and supplemental employer contribution. (a) In 
10.31 	addition to member contributions, department heads shall pay a sum equal to the specified 
11.1 	percentage of the salary upon which deductions were made, which constitutes the employer 
11.2 	contribution to the fund as follows:

11.3		from July 1, 2014, to June 30, 2016
	20.1
	
11.4		from July 1, 2016, to June 30, 2018
	21.6
	
11.5		from July 1, 2018, to June 30, 2019
	22.35
	
11.6		after June 30, 2019
	23.1
	
11.7 	(b) Department contributions must be paid out of money appropriated to departments 
11.8 	for this purpose.
11.9 	(c) Contribution increases under paragraph (a) must be paid starting the first day of the 
11.10 	first full pay period after the effective date of the increase.
11.11 	(d) Effective July 1, 2018, department heads shall pay a supplemental employer 
11.12 	contribution. The supplemental contribution is 1.75 percent of the salary upon which 
11.13 	deductions are made from July 1, 2018, through June 30, 2019; three percent of the salary 
11.14 	upon which deductions are made from July 1, 2019, through June 30, 2020; five percent of 
11.15 	the salary which deductions are made from July 1, 2020, through June 30, 2021; and seven 
11.16 	percent of the salary upon which deductions are made thereafter. The supplemental 
11.17 	contribution must be paid starting the first day of the first full pay period after June 30, 
11.18 	2018. The supplemental contribution rate of seven percent remains in effect until, for three 
11.19 	consecutive years, the market value of the assets of the State Patrol retirement plan of the 
11.20 	Minnesota State Retirement System equals or exceeds the actuarial accrued liability of the 
11.21 	plan as determined by the actuary retained under section 356.214. The expiration of the 
11.22 	supplemental employer contribution is effective the first day of the first full pay period of 
11.23 	the fiscal year immediately following the issuance of the third actuarial valuation upon 
11.24 	which the expiration is based.

11.25 	Sec. 5. Minnesota Statutes 2022, section 490.123, subdivision 5, is amended to read:
11.26 		Subd. 5.Direct state aid. (a) The state shall pay $6,000,000 annually to the judges' 
11.27 	retirement fund. The aid is payable each July 1. The amount required is annually appropriated 
11.28 	from the general fund to the judges' retirement fund.
11.29 	(b) The aid under paragraph (a) continues until the earlier of:
11.30 	(1) the first day of the fiscal year following thethree consecutive fiscal yearyears in 
11.31 	which the actuarial value of assets of the fund equals or exceeds 100 percent of the actuarial 
11.32 	accrued liabilities as reported by the actuary retained under section 356.214 in the annual 
11.33 	actuarial valuation prepared under section 356.215; or
12.1 	(2) July 1, 2048.

12.2 	ARTICLE 4
12.3 	PUBLIC EMPLOYEES RETIREMENT ASSOCIATION

12.4 	Section 1. Minnesota Statutes 2022, section 353.01, subdivision 47, is amended to read:
12.5 		Subd. 47.Vesting. (a) "Vesting" means obtaining a nonforfeitable entitlement to an 
12.6 	annuity or benefit from a retirement plan administered by the Public Employees Retirement 
12.7 	Association by having credit for sufficient allowable service under paragraph (b), (c), or 
12.8 	(d), whichever applies.
12.9 	(b) For purposes of qualifying for an annuity or benefit as a basic or coordinated plan 
12.10 	member of the general employees retirement plan of the Public Employees Retirement 
12.11 	Association:(1), a public employee who first became a member of the association before 
12.12 	July 1, 2010, is 100 percent vested when the person has accrued credit for not less than three 
12.13 	years of allowable service in the general employees retirement plan; and.
12.14 	(2) a public employee who first becomes a member of the association after June 30, 
12.15 	2010, is 100 percent vested when the person has accrued credit for not less than five years 
12.16 	of allowable service in the general employees retirement plan.
12.17 	(c) For purposes of qualifying for an annuity or benefit as a member of the local 
12.18 	government correctional service retirement plan:
12.19 	(1) a public employee who first became a member of the association before July 1, 2010, 
12.20 	is 100 percent vested when the person has accrued credit for not less than three years of 
12.21 	allowable service in the local government correctional service retirement plan; and
12.22 	(2) a public employee who first becomes a member of the association after June 30, 
12.23 	2010, is vested at the following percentages when the person has accrued credit for allowable 
12.24 	service in the local government correctional service retirement plan, as follows:
12.25 	(i) 50 percent after five years;
12.26 	(ii) 60 percent after six years;
12.27 	(iii) 70 percent after seven years;
12.28 	(iv) 80 percent after eight years;
12.29 	(v) 90 percent after nine years; and
12.30 	(vi) 100 percent after ten years.
13.1 	(d) For purposes of qualifying for an annuity or benefit as a member of the public 
13.2 	employees police and fire retirement plan:
13.3 	(1) a public employee who first became a member of the association before July 1, 2010, 
13.4 	is 100 percent vested when the person has accrued credit for not less than three years of 
13.5 	allowable service in the public employees police and fire retirement plan;
13.6 	(2) a public employee who first becomes a member of the association after June 30, 
13.7 	2010, and before July 1, 2014, is vested at the following percentages when the person has 
13.8 	accrued credited allowable service in the public employees police and fire retirement plan, 
13.9 	as follows:
13.10 	(i) 50 percent after five years;
13.11 	(ii) 60 percent after six years;
13.12 	(iii) 70 percent after seven years;
13.13 	(iv) 80 percent after eight years;
13.14 	(v) 90 percent after nine years; and
13.15 	(vi) 100 percent after ten years; and
13.16 	(3) a public employee who first becomes a member of the association after June 30, 
13.17 	2014, is vested at the following percentages when the person has accrued credit for allowable 
13.18 	service in the public employees police and fire retirement plan, as follows:
13.19 	(i) 50 percent after ten years;
13.20 	(ii) 55 percent after 11 years;
13.21 	(iii) 60 percent after 12 years;
13.22 	(iv) 65 percent after 13 years;
13.23 	(v) 70 percent after 14 years;
13.24 	(vi) 75 percent after 15 years;
13.25 	(vii) 80 percent after 16 years;
13.26 	(viii) 85 percent after 17 years;
13.27 	(ix) 90 percent after 18 years;
13.28 	(x) 95 percent after 19 years; and
13.29 	(xi) 100 percent after 20 or more years.

14.1 	ARTICLE 5
14.2 	ST. PAUL TEACHERS RETIREMENT FUND ASSOCIATION

14.3 	Section 1. Minnesota Statutes 2022, section 354A.12, subdivision 1, is amended to read:
14.4 		Subdivision 1.Employee contributions. (a) The contribution required to be paid by 
14.5 	each member of the St. Paul Teachers Retirement Fund Association is the percentage of 
14.6 	total salary specified below for the applicable association and program:

14.7		Program
	Percentage of Total Salary
	
14.8		St. Paul Teachers Retirement Fund Association
			
14.9		basic program after June 30, 2016, through June 30, 2023
		10 percent
	
14.10		basic program after June 30,  2023, through June 30, 2025
		10.25 percent
	
14.11		basic program after June 30, 2025
		11.25 percent
	
14.12
14.13		coordinated program after June 30, 2016, through June 30, 
2023
		7.5 percent
	
14.14
14.15		coordinated program after June 30, 2023, through June 30, 
2025
		7.75 percent
	
14.16		coordinated program after June 30, 2025
		8.75 percent
	
14.17 	(b) Contributions must be made by deduction from salary and must be remitted directly 
14.18 	to the St. Paul Teachers Retirement Fund Association at least once each month.
14.19 	(c) When an employee contribution rate changes for a fiscal year, the new contribution 
14.20 	rate is effective for the entire salary paid by the employer with the first payroll cycle reported.

14.21 	Sec. 2. Minnesota Statutes 2022, section 354A.31, is amended by adding a subdivision to 
14.22 	read:
14.23 		Subd. 5a.Unreduced early retirement. If a member retires on or after July 1, 2023, 
14.24 	when the member is at least age 62 and has at least 30 years of service, the member is 
14.25 	entitled to receive a retirement annuity calculated using the retirement annuity formula 
14.26 	percentage in subdivision 4.

14.27 	Sec. 3. Minnesota Statutes 2022, section 354A.31, subdivision 7, is amended to read:
14.28 		Subd. 7. Reduction for early retirement. (a) This subdivision applies to a person who 
14.29 	has become at least 55 years old and first becomes a coordinated member after June 30, 
14.30 	1989, and to any other coordinated member who has become at least 55 years old and whose 
14.31 	annuity is higher when calculated using the retirement annuity formula percentage in 
14.32 	subdivision 4, paragraph (d), in conjunction with this subdivision than when calculated 
14.33 	under subdivision 4, paragraph (c), in conjunction with subdivision 6. An employee who 
15.1 	retires under the formula annuity before the normal retirement age shall be paid the normal 
15.2 	annuity reduced as described in paragraph (b) if the person retires on or after July 1, 2019, 
15.3 	or in paragraph (c) if the person retires before July 1, 2019, as applicable.
15.4 	(b)(1) Unless the member is eligible for an unreduced early retirement annuity under 
15.5 	subdivision 5a, a coordinated member who retires before the normal retirement age and on 
15.6 	or after July 1, 2019, is entitled to receive a retirement annuity calculated using the retirement 
15.7 	annuity formula percentage in subdivision 4, paragraph (d), reduced as described in clause 
15.8 	(1) or (2), as applicable.
15.9 	(1)(2) If the member retires when the member is younger than age 62 or with fewer 
15.10 	than 30 years of service, the annuity must be reduced by an early reduction factor for each 
15.11 	year that the member's age of retirement precedes normal retirement age. The early reduction 
15.12 	factors are four percent per year for members whose age at retirement is at least 55 but not 
15.13 	yet 59 and seven percent per year for members whose age at retirement is at least 59 but 
15.14 	not yet normal retirement age. The resulting annuity must be further adjusted to take into 
15.15 	account augmentation as if the employee had deferred receipt of the annuity until normal 
15.16 	retirement age and the annuity were augmented at the applicable annual rate, compounded 
15.17 	annually, from the day the annuity begins to accrue until normal retirement age. The 
15.18 	applicable annual rate is the rate in effect on the employee's effective date of retirement and 
15.19 	shall be considered as fixed for the employee. The applicable annual rates are the following:
15.20 	(i) until June 30, 2019, 2.5 percent;
15.21 	(ii) a rate that changes each month, beginning July 1, 2019, through June 30, 2024, which 
15.22 	is determined by reducing the rate in item (i) to zero in equal monthly increments over the 
15.23 	five-year period; and
15.24 	(iii) after June 30, 2024, zero percent.
15.25 	After June 30, 2024, the reduced annuity commencing before normal retirement age 
15.26 	under this clause shall not take into account any augmentation.
15.27 	(2) If the member retires when the member is at least age 62 or older and has at least 30 
15.28 	years of service, the member is entitled to receive a retirement annuity calculated using the 
15.29 	retirement annuity formula percentage in subdivision 4, paragraph (d), multiplied by the 
15.30 	applicable early retirement factor specified for members "Age 62 or older with 30 years of 
15.31 	service" in the table in paragraph (c).
15.32 	(c) Unless the member is eligible for an unreduced early retirement annuity under 
15.33 	subdivision 5a, a coordinated member who retires before the normal retirement age and 
16.1 	before July 1, 2019, is entitled to receive a retirement annuity calculated using the retirement 
16.2 	annuity formula percentage in subdivision 4, paragraph (d), multiplied by the applicable 
16.3 	early retirement factor specified below:

16.4		Under age 62
	Age 62 or older
	
16.5		or less than 30 years of service
	with 30 years of service

16.6	Normal retirement age:
	65
	66
	65
	66
	
16.7	Age at retirement
					
16.8	55
	0.5376
	0.4592
			
16.9	56
	0.5745
	0.4992
			
16.10	57
	0.6092
	0.5370
			
16.11	58
	0.6419
	0.5726
			
16.12	59
	0.6726
	0.6062
			
16.13	60
	0.7354
	0.6726
			
16.14	61
	0.7947
	0.7354
			
16.15	62
	0.8507
	0.7947
	0.8831
	0.8389
	
16.16	63
	0.9035
	0.8507
	0.9246
	0.8831
	
16.17	64
	0.9533
	0.9035
	0.9635
	0.9246
	
16.18	65
	1.0000
	0.9533
	1.0000
	0.9635
	
16.19	66
		1.0000
		1.0000
	
16.20 	For normal retirement ages between ages 65 and 66, the early retirement factors must 
16.21 	be determined by linear interpolation between the early retirement factors applicable for 
16.22 	normal retirement ages 65 and 66.

16.23 	ARTICLE 6
16.24 	APPROPRIATIONS

16.25 	Section 1. APPROPRIATION; ONETIME DIRECT STATE AIDS.
 16.26 		Subdivision 1.Appropriation. $485,900,000 in fiscal year 2024 is appropriated from 
16.27 	the general fund to the commissioner of management and budget to transfer onetime state 
16.28 	aid to the fund for each pension plan as specified in subdivision 2 and pay onetime state aid 
16.29 	to St. Paul Teachers Retirement Fund Association in the amount specified in subdivision 
16.30 	2.
16.31 		Subd. 2.Direct state aids On October 1, 2023, the commissioner must allocate the 
16.32 	amount appropriated in subdivision 1 among the funds for the pension plans as follows:

16.33		Plan
	Amount
	
16.34		general state employees retirement plan
	$76,439,615
		
17.1		correctional state employees retirement plan
	$10,446,018
		
17.2		State Patrol retirement plan
	$11,970,568
		
17.3		legislators retirement plan
	$90,714
		
17.4		judges retirement plan
	$293,032
		
17.5		general public employees retirement plan
	$170,093,422
		
17.6		public employees police and fire retirement plan
	$19,397,371
		
17.7		local government correctional service retirement plan
	$5,255,535
		
17.8		Teachers Retirement Association
	$176,166,838
		
17.9		St. Paul Teachers Retirement Fund Association
	$15,746,887

17.10 	Sec. 2. STATEWIDE VOLUNTEER FIREFIGHTER PLAN INCENTIVE 
17.11 	PROGRAM.
 17.12 		Subdivision 1.Definitions. For purposes of this section:
17.13 	(1) "association" means the Public Employees Retirement Association;
17.14 	(2) "commission" means the Legislative Commission on Pensions and Retirement;
17.15 	(3) "incentive program" means the program established by this section for paying 
17.16 	monetary incentives to join the statewide plan, to be deposited in the account of each fire 
17.17 	department joining the statewide plan and used to fund retirement benefits for the fire 
17.18 	department's volunteer firefighters;
17.19 	(4) "relief association" means volunteer firefighter relief association; and
17.20 	(5) "statewide plan" means the statewide volunteer firefighter plan.
17.21 		Subd. 2.Statewide volunteer firefighter plan incentive program. (a) The executive 
17.22 	director of the association must prepare an outline of the incentive program. This outline 
17.23 	must be delivered to the members of the commission by January 5, 2024. The incentive 
17.24 	program must benefit fire departments joining the statewide plan on or after July 1, 2023, 
17.25 	and the first payments must be made no later than December 31, 2024.
17.26 	(b) The executive director of the association must work with the staff of the commission 
17.27 	to prepare legislation to add a defined contribution component to the statewide plan and 
17.28 	make other statutory changes as appropriate to encourage fire departments and their affiliated 
17.29 	relief associations to join the statewide plan. The proposed legislation must be delivered to 
17.30 	members of the commission no later than January 5, 2024.
17.31 	(c) The executive director of the association must prepare an annual report on the 
17.32 	incentive program to be delivered to the commission until the appropriation is expended.
18.1 		Subd. 3.Account created; appropriation. The statewide volunteer firefighter incentive 
18.2 	account is created within the special revenue fund. Money in the account, including interest, 
18.3 	is appropriated to the commissioner of management and budget for deposit, at the direction 
18.4 	of the executive director of the association, into the plan account of each fire department 
18.5 	that joins the statewide volunteer firefighter plan.
18.6 		Subd. 4.Transfer $5,000,000 in fiscal year 2024 is transferred from the general fund 
18.7 	to the statewide volunteer firefighter incentive account established under subdivision 3.

18.8 	Sec. 3. APPROPRIATION; LEGISLATIVE COORDINATING COMMISSION.
 18.9 	$100,000 in fiscal year 2024 is appropriated from the general fund to the Legislative 
18.10 	Coordinating Commission for the Legislative Commission on Pensions and Retirement to 
18.11 	provide funding for additional independent actuarial cost assessments for the Legislative 
18.12 	Commission on Pensions and Retirement to make informed decisions on pension policy 
18.13 	and legislation.