SF 3467

Introduction - 94th Legislature (2025 - 2026)

Posted on 05/01/2025 09:32 a.m.

A bill for an act
relating to retirement; making technical changes, clarifications, and corrections to
the statutes governing the Legislative Commission on Pensions and Retirement,
the statewide volunteer firefighter plan, IRAP to TRA transfers, fire state aid and
police and firefighter retirement supplemental state aid, and the public employees
defined contribution plan; modifying practices for expenses and reporting and
repealing certain reporting requirements for the State Board of Investment;
eliminating obsolete provisions; amending Minnesota Statutes 2024, sections 3.85,
subdivisions 2, 3, 10; 11A.07, subdivisions 4, 4b; 124E.12, subdivisions 4, 6;
181.101; 353D.01, subdivision 2; 353D.02, subdivision 4; 353G.08, subdivision
1a; 353G.11, subdivisions 2, 2a, by adding a subdivision; 353G.17, subdivisions
4, 5; 353G.19, subdivisions 1, 2, 3, 4, 5; 354B.215, subdivisions 3, 4; 356.633,
subdivisions 1, 2, by adding a subdivision; 423A.022, subdivisions 2, 3; 424A.014,
subdivision 5; 424A.08; 424B.22, subdivisions 1, 2, 3, by adding a subdivision;
477B.02, subdivisions 3, 8; 477B.03, subdivisions 5, 7; 477B.04, subdivisions 3,
4; proposing coding for new law in Minnesota Statutes, chapter 356; repealing
Minnesota Statutes 2024, sections 11A.27; 356.635, subdivision 9.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

ARTICLE 1

LEGISLATIVE COMMISSION ON PENSIONS AND RETIREMENT

Section 1.

Minnesota Statutes 2024, section 3.85, subdivision 2, is amended to read:

Subd. 2.

Powers.

The commission shall make a continuing study and investigation of
retirement benefit plans applicable to nonfederal government employees in this state. The
powers and duties of the commission include, but are not limited to the following:

(a) studying retirement benefit plans applicable to nonfederal government employees
in Minnesota, including federal plans available to the employees;

(b) making recommendations within the scope of its study, including attention to financing
of the various pension funds and financing of accrued liabilities;

(c) considering all aspects of pension planning and operation and making
recommendations designed to establish and maintain sound pension policy for all funds;

(d) analyzing deleted text begin each item of deleted text end proposed pension and retirement legislation, including
amendments deleted text begin to each deleted text end , with particular reference to analysis of deleted text begin their deleted text end new text begin the legislation's new text end cost,
actuarial soundness, and adherence to sound pension policy deleted text begin , and reporting its findings to
the legislature deleted text end ;

(e) creating and maintaining a library for reference concerning pension and retirement
matters, including information about laws and systems in other states; and

(f) studying, analyzing, and preparing reports in regard to subjects certified to the
commission for study.

Sec. 2.

Minnesota Statutes 2024, section 3.85, subdivision 3, is amended to read:

Subd. 3.

Membership.

The commission consists of seven members of the senate
appointed by the Subcommittee on Committees of the Committee on Rules and
Administration and seven members of the house of representatives appointed by the speaker.
No more than five members from each chamber may be from the majority caucus in that
chamber. Members shall be appointed at the commencement of each regular session of the
legislature for a two-year term beginning January 16 of the first year of the regular session.
deleted text begin Members continue deleted text end new text begin A member continues new text end to serve until deleted text begin their successors are appointed deleted text end new text begin the
earlier of the appointment of the member's successor or the end of the member's legislative
term or office new text end . Vacancies that occur while the legislature is in session shall be filled like
regular appointments. If the legislature is not in session, senate vacancies shall be filled by
the last Subcommittee on Committees of the senate Committee on Rules and Administration
or other appointing authority designated by the senate rules, and house of representatives
vacancies shall be filled by the last speaker of the house, or if the speaker is not available,
by the last chair of the house of representatives Rules Committee.

Sec. 3.

Minnesota Statutes 2024, section 3.85, subdivision 10, is amended to read:

Subd. 10.

Standards for pension valuations and cost estimates.

The commission shall
adopt standards prescribing deleted text begin specific detailed deleted text end methods to calculate, evaluate, and display
current and deleted text begin proposed law deleted text end new text begin projected new text end liabilities, costs, and actuarial equivalents of deleted text begin all deleted text end new text begin covered new text end
public deleted text begin employee deleted text end pension plans deleted text begin in Minnesota deleted text end new text begin under section 356.20, subdivision 2, that are
defined benefit plans new text end . These standards deleted text begin shall deleted text end new text begin must new text end be consistent with chapter 356 and be
updated deleted text begin annually deleted text end new text begin periodically new text end . At a minimum, the standards deleted text begin shall deleted text end new text begin must new text end contain requirements
that comply with deleted text begin generally accepted accounting principles deleted text end new text begin actuarial standards of practice new text end
applicable to government pension plans. deleted text begin The standards may include additional financial,
funding, or valuation requirements that are not required under generally accepted accounting
principles applicable to government pension plans.
deleted text end

Sec. 4. new text begin EFFECTIVE DATE.
new text end

new text begin Sections 1 to 3 are effective the day following final enactment.
new text end

ARTICLE 2

STATEWIDE VOLUNTEER FIREFIGHTER PLAN

Section 1.

Minnesota Statutes 2024, section 353G.08, subdivision 1a, is amended to read:

Subd. 1a.

Annual funding requirements; monthly division.

(a) Annually, the executive
director shall determine the funding requirements of each deleted text begin monthly benefit deleted text end new text begin fire department
new text end account in the deleted text begin statewide volunteer firefighter deleted text end new text begin monthly division of the defined benefit new text end plan
on or before August 1.

(b) The executive director must determine the funding requirements of a deleted text begin monthly benefit deleted text end
new text begin fire department new text end account under this subdivision from:

(1) the most recent actuarial valuation normal cost, administrative expense, including
the cost of a regular actuarial valuation, and amortization results for the account determined
by the approved actuary retained by the retirement association under sections 356.215 and
356.216; and

(2) the standards for actuarial work, utilizing a six percent investment return actuarial
assumption and other actuarial assumptions approved under section 356.215, subdivision
18:

(i) with that portion of any unfunded actuarial accrued liability attributable to a benefit
increase to be amortized over a period of 20 years from the date of the benefit change;

(ii) with that portion of any unfunded actuarial accrued liability attributable to an
assumption change or an actuarial method change to be amortized over a period of 20 years
from the date of the assumption or method change;

(iii) with that portion of any unfunded actuarial accrued liability attributable to an
investment loss to be amortized over a period of ten years from the date of investment loss;
and

(iv) with the balance of any net unfunded actuarial accrued liability to be amortized over
a period of five years from the date of the actuarial valuation.

(c) The required contributions of the entity or entities associated with the fire department
whose active firefighters are covered by the monthly division are the annual financial
requirements of the deleted text begin monthly benefit deleted text end new text begin fire department new text end account deleted text begin of the plan deleted text end under paragraph
(b) reduced by the amount of any fire state aid payable under chapter 477B, or any police
and firefighter retirement supplemental state aid payable under section 423A.022, that is
reasonably anticipated to be received by the plan attributable to the entity or entities during
the following calendar year. The required contribution must be allocated between the entities
if more than one entity is involved. A reasonable amount of anticipated fire state aid is an
amount that does not exceed the fire state aid actually received in the prior year multiplied
by the factor 1.035.

(d) The required contribution calculated in paragraph (c) must be paid to the plan on or
before December 31 of the year for which it was calculated. If the contribution is not received
by the plan by December 31, it is payable with interest at an annual compound rate of six
percent from the date due until the date payment is received by the plan. If the entity does
not pay the full amount of the required contribution, the executive director shall collect the
unpaid amount under section 353.28, subdivision 6.

Sec. 2.

Minnesota Statutes 2024, section 353G.11, is amended by adding a subdivision to
read:

new text begin Subd. 1b. new text end

new text begin Applicable benefit level. new text end

new text begin (a) In determining a member's retirement benefit
under section 353G.09, subdivision 1a, the benefit level applicable to the member is the
benefit level in effect as of the date the member terminated firefighting services for the fire
department of a participating employer.
new text end

new text begin (b) Except as provided under section 353G.09, subdivision 4:
new text end

new text begin (1) the benefit level for a member of the lump-sum division is the benefit level selected
under section 353G.05, subdivision 1d, by the member's relief association or, if applicable,
the municipality or firefighting corporation that employs the member or the benefit level
as modified under subdivision 2, whichever is in effect as of the date the member terminated
firefighting services; or
new text end

new text begin (2) the benefit level for a member of the monthly division is the benefit level under the
retirement benefit plan document applicable to the member's former relief association or
the benefit level under the retirement benefit plan document as modified under subdivision
2a, whichever is in effect as of the date the member terminated firefighting services.
new text end

Sec. 3.

Minnesota Statutes 2024, section 353G.11, subdivision 2, is amended to read:

Subd. 2.

Benefit level changes in new text begin the new text end lump-sum division deleted text begin of defined benefit plan deleted text end .

(a)
A fire department's fire chief or the governing body operating a fire department may request
an increase in the benefit level as provided in this subdivision.

(b) The fire chief or governing body must request a cost estimate from the executive
director of an increase in the deleted text begin service pension deleted text end new text begin benefit new text end level applicable to the active firefighters
of the fire department.

(c) The executive director must prepare the cost estimate using a procedure certified as
accurate by the approved actuary retained by the association.

(d) Within 120 days after receiving the cost estimate from the executive director, the
governing body may approve the benefit level change, effective for January 1 of the following
calendar year unless the governing body specifies in the approval document an effective
date that is January 1 of the second year following the approval date. If the approval occurs
after April 30, the required municipal contribution for the following calendar year must be
recalculated and the results reported to the governing body. If not approved within 120 days
of the receipt of the cost estimate, the benefit level change is considered to have been
disapproved.

Sec. 4.

Minnesota Statutes 2024, section 353G.11, subdivision 2a, is amended to read:

Subd. 2a.

deleted text begin Procedure for changing deleted text end Benefit level new text begin changes in the monthly division new text end .

(a)
deleted text begin The deleted text end new text begin A fire department's new text end fire chief deleted text begin of a fire department deleted text end new text begin or the governing body operating a
fire department new text end that has an active membership deleted text begin that is deleted text end covered by the monthly deleted text begin benefit
retirement deleted text end division deleted text begin of the plan deleted text end may deleted text begin initiate the process of modifying deleted text end new text begin request an increase in
the benefit level provided in new text end the retirement benefit plan document under this deleted text begin section deleted text end new text begin
subdivision new text end .

(b) The modification procedure is initiated when the deleted text begin applicable deleted text end fire chief new text begin or governing
body new text end files with the executive director deleted text begin of the association deleted text end a written summary of the desired
deleted text begin benefit plan document deleted text end modification, the proposed deleted text begin benefit plan document deleted text end modification
language, a written request for the preparation of an actuarial cost estimate for the proposed
deleted text begin benefit plan document deleted text end modification, and payment of the estimated cost of the actuarial cost
estimate.

(c) Upon receipt of the modification request and related documents, the executive director
deleted text begin shall deleted text end new text begin must new text end review the language of the proposed deleted text begin benefit plan document deleted text end modification and, if
a clarification is needed in the submitted language, deleted text begin shall deleted text end inform the fire chief new text begin or governing
body new text end of the necessary clarification. deleted text begin Once deleted text end new text begin After new text end the deleted text begin proposed benefit plan document
modification language deleted text end new text begin fire chief or governing body new text end has deleted text begin been clarified by the fire chief and
resubmitted deleted text end new text begin submitted the clarified language new text end to the executive director, the executive director
deleted text begin shall arrange for the approved actuary retained by the association to prepare a benefit plan
document modification cost estimate under the applicable provisions of section 356.215
and of the standards for actuarial work adopted by the Legislative Commission on Pensions
and Retirement deleted text end new text begin must prepare the cost estimate using a procedure certified as accurate by
the approved actuary retained by the association new text end . Upon completion of the deleted text begin benefit plan
document modification deleted text end cost estimate, the executive director deleted text begin shall deleted text end new text begin must new text end forward the estimate
to the fire chief deleted text begin who requested it deleted text end and to the chief financial officer of the municipality or
entity with which the fire department is primarily associated.

(d) The fire chief, upon receipt of the cost estimate, deleted text begin shall circulate deleted text end new text begin must distribute new text end the
cost estimate deleted text begin with deleted text end new text begin to new text end the active firefighters in the fire department and deleted text begin shall deleted text end take reasonable
steps to provide the new text begin cost new text end estimate deleted text begin results deleted text end to any affected retired members of the fire
department and their beneficiaries. The chief financial officer of the municipality or entity
associated with the fire department deleted text begin shall deleted text end new text begin must new text end present the proposed modification language
and the cost estimate to the governing body of the municipality or entity for its consideration
at a public hearing held for that purpose.

(e) If the governing body of the municipality or entity approves the modification language,
the chief administrative officer of the municipality or entity deleted text begin shall deleted text end new text begin must new text end notify the executive
director deleted text begin of the association deleted text end of that approval. The deleted text begin benefit plan document deleted text end modification is
effective on deleted text begin the deleted text end January 1 following the date of filing the approval with the association.

Sec. 5.

Minnesota Statutes 2024, section 353G.17, subdivision 4, is amended to read:

Subd. 4.

Transfer process.

(a) Upon completion of the actions required under
subdivisions 1 to 3, the plan shall transfer to the relief association as of the effective date
identified in the notice under subdivision 1, the records, assets, and liabilities related to the
former and current firefighters with benefits under the plan, along with any assets in excess
of liabilities deleted text begin credited to the lump-sum account or the monthly benefit retirement account
attributable to the firefighters and the municipality deleted text end .

(b) The executive director:

(1) deleted text begin shall deleted text end new text begin must new text end transfer the assets in cash;

(2) deleted text begin shall deleted text end new text begin must new text end transfer any accounts receivable deleted text begin associated with the lump-sum account
or monthly benefit retirement account deleted text end ;

(3) deleted text begin shall deleted text end new text begin must new text end settle any accounts payable deleted text begin from the account deleted text end before the transfer; and

(4) may deduct from the assets to be transferred reasonable costs incurred by the plan
to conduct the voting process and complete the transfer.

Sec. 6.

Minnesota Statutes 2024, section 353G.17, subdivision 5, is amended to read:

Subd. 5.

Relief association obligations and rights upon transfer from the plan.

(a)
Upon transfer of the assets of the deleted text begin lump-sum account or monthly benefit retirement deleted text end new text begin fire
department new text end account, the pension liabilities attributable to the benefits for the former and
current firefighters deleted text begin shall deleted text end become the obligation of the special fund of the relief association.

(b) Upon the transfer of the assets of the deleted text begin lump-sum account or monthly benefit retirement deleted text end
new text begin fire department new text end account, the board of trustees of the relief association has legal title to and
management responsibility for the transferred assets as trustees for persons having a beneficial
interest in those assets arising out of the benefit coverage provided by the account.

(c) The relief association is the successor in interest with respect to all claims against
the plan relating to the transferred deleted text begin lump-sum account or monthly benefit retirement deleted text end new text begin fire
department new text end account, except for claims alleging any act or acts by the plan or its fiduciaries
that were not done in good faith or that constituted a breach of fiduciary responsibility under
chapter 356A.

(d) The value of each volunteer firefighter's benefit in the plan on the day before the
asset transfer shall be no less than the value of the volunteer firefighter's benefit on the day
after the asset transfer. The relief association shall give credit, with respect to each firefighter
whose benefit is being transferred, for all past service, including service credit with the plan
and with any predecessor relief association, to the extent credit is given for such service in
the records of the plan for that firefighter.

(e) Upon completion of the transfer of records, assets, and liabilities, the executive
director shall provide written notice to the state auditor, the commissioner of revenue, and
the secretary of state that the transfer is complete.

Sec. 7.

Minnesota Statutes 2024, section 353G.19, subdivision 1, is amended to read:

Subdivision 1.

Authority to initiate conversion.

(a) A participating employer associated
with a fire department covered by the defined benefit plan, including an entity previously
affiliated with a defined benefit relief association when the entity made a request for coverage
by the defined contribution plan under section 353G.05, subdivision 1b, paragraph (c), may
convert to coverage by the defined contribution plan in accordance with this section.

(b) Conversion from coverage by the defined benefit plan to coverage by the defined
contribution plan consists of:

(1) a resolution by the governing body of the participating employer;

(2) notice to all former and active volunteer firefighters of the fire department;

(3) full vesting new text begin on the conversion effective date new text end of all active and former volunteer
firefighters with an accrued benefit in the defined benefit plan attributable to service with
the fire department new text begin , to the extent funded as of the conversion effective date new text end ; and

(4) allocation of surplus over full funding, if any, to individual accounts in the fire
department's new account in the defined contribution plan.

(c) For an entity previously affiliated with a defined benefit relief association when the
entity made a request for coverage by the defined contribution plan under section 353G.05,
subdivision 1b, paragraph (c), a conversion must occur under paragraph (b) immediately
after coverage by the retirement plan of the entity's fire department and the entity's volunteer
firefighters takes effect.

Sec. 8.

Minnesota Statutes 2024, section 353G.19, subdivision 2, is amended to read:

Subd. 2.

Resolutions by the governing body.

To initiate a conversion, the governing
body of the participating employer must file with the executive director at least 30 days
before the end of a calendar year:

(1) a resolution that states that the fire department elects to participate in the defined
contribution plan effective on the conversion effective date, which is the first day of the
next calendar year; and

(2) if new text begin , as of the valuation immediately preceding the conversion effective date, new text end the fire
department account had a deficit from full funding as defined under section 353G.08,
subdivision 1, paragraph (c), or the special fund of the defined benefit relief association had
a deficit from full funding as defined in section 424A.092, subdivision 3, paragraph (b), a
resolution approving a contribution to the retirement plan in the amount necessary to
eliminate the deficit, which is to be paid within 30 days of the filing of the resolution or in
installments over three years, with the first payment to be made within 30 days of the filing
of the resolution.

Sec. 9.

Minnesota Statutes 2024, section 353G.19, subdivision 3, is amended to read:

Subd. 3.

Notice to participants.

The participating employer must provide notice to all
active and former volunteer firefighters in the fire department at least 30 days before the
conversion effective date. The notice must include:

(1) an explanation that the plan is converting from a defined benefit plan to a defined
contribution plan, including definitions of those terms, on the conversion effective date and
that the active and former volunteer firefighters will become deleted text begin fully deleted text end vested in their accrued
benefit new text begin to the extent funded new text end as of the conversion effective date;

(2) a summary of the terms of the defined contribution plan;

(3) a section tailored to each volunteer firefighter that provides an estimate of the present
value of the participant's deleted text begin fully deleted text end vested accrued benefit and the calculation that resulted in
that value;

(4) an estimate of any anticipated surplus and an explanation of the allocation of the
surplus; and

(5) contact information for the chief administrative officer or chief financial officer of
the participating employer and the designated staff member of the retirement plan who will
answer questions and directions to a website.

Sec. 10.

Minnesota Statutes 2024, section 353G.19, subdivision 4, is amended to read:

Subd. 4.

Full vesting and determination of accrued benefit.

(a) On the conversion
effective date, each active or former volunteer firefighter with a retirement benefit under
the defined benefit plan, except any retiree in pay status who is receiving a monthly benefit,
becomes 100 percent vested new text begin or, if the defined benefit plan does not have sufficient assets
to fund 100 percent vesting, as close to 100 percent vested as the funding permits, new text end as of the
conversion effective date in the firefighter's retirement benefit, without regard to the number
of years of vesting service credit.

(b) The executive director must determine the present value of each active or former
firefighter's accrued benefit as of the conversion effective date, taking into account the full
vesting requirement under paragraph (a).

Sec. 11.

Minnesota Statutes 2024, section 353G.19, subdivision 5, is amended to read:

Subd. 5.

Surplus over full funding.

If the fire department account has a surplus over
full funding, as defined under section 353G.08, subdivision 1, paragraph (c), the executive
director must allocate the surplus over full funding to the individual account of each active
deleted text begin and former deleted text end volunteer firefighter, deleted text begin except any former volunteer firefighter receiving an annuity, deleted text end
in the same proportion that the volunteer firefighter's accrued benefit bears to the total
accrued benefits of all active deleted text begin and former deleted text end volunteer firefighters.

Sec. 12. new text begin EFFECTIVE DATE.
new text end

new text begin Sections 1 to 11 are effective the day following final enactment.
new text end

ARTICLE 3

IRAP TO TRA TRANSFERS

Section 1.

Minnesota Statutes 2024, section 354B.215, subdivision 3, is amended to read:

Subd. 3.

Eligible person.

(a) An eligible person is a person who:

(1) is employed by Minnesota State;

(2) has an account in the individual retirement account plan; deleted text begin and
deleted text end

(3) deleted text begin satisfies deleted text end new text begin was previously eligible to elect coverage by the Teachers Retirement
Association under one or more sections of chapter 354B or any prior version of chapter
354B; and
new text end

new text begin (4) is not disqualified because Minnesota State produces one or more of the items listed
in new text end paragraph (b).

(b) A person deleted text begin satisfies this paragraph deleted text end new text begin is not an eligible person new text end if Minnesota State deleted text begin is not
able to produce deleted text end new text begin produces new text end at least one of the following items by the end of the deleted text begin 60-day deleted text end new text begin 75-day new text end
period under subdivision 4, paragraph (b):

(1) a record indicating that the person received notice regarding the person's eligibility
to elect deleted text begin prospective deleted text end coverage by the Teachers Retirement Association deleted text begin within the election
period under section 354B.211, subdivision 4 or 6, or its predecessor deleted text end new text begin during the person's
first year of eligibility to participate in the individual retirement account plan new text end ;

new text begin (2) a record indicating that the person received notice regarding the person's eligibility
to elect coverage by the Teachers Retirement Association during the person's first year after
attaining tenure or comparable permanent status;
new text end

deleted text begin (2) deleted text end new text begin (3) new text end a record that the person elected retirement coverage by the individual retirement
account plan; or

deleted text begin (3) deleted text end new text begin (4) new text end other credible documentation demonstrating that the person was aware of the
person's right to elect retirement coverage by the Teachers Retirement Association.

new text begin (c) The record described in paragraph (b), clause (1), is not effective to disqualify a
person if the person was eligible to elect coverage by the Teachers Retirement Association
during the person's first year after attaining tenure or comparable permanent status.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective retroactively from January 1, 2025.
new text end

Sec. 2.

Minnesota Statutes 2024, section 354B.215, subdivision 4, is amended to read:

Subd. 4.

Eligible person application; information required from Minnesota State.

(a)
To elect coverage by the Teachers Retirement Association, an eligible person must submit
a written application to the chancellor on a form provided by Minnesota State. The application
must include:

(1) an attestation that the person was not informed of the right to elect a transfer from
the individual retirement account plan to the Teachers Retirement Association and the person
was unaware of the right to elect such a transfer;

(2) the date on which the person first became a participant in the individual retirement
account plan;

(3) a signed release authorizing Minnesota State to provide employment and other
personnel information to the Teachers Retirement Association; and

(4) any other information that Minnesota State may require.

(b) No later than deleted text begin 60 deleted text end new text begin 75 new text end days after receipt of the application under paragraph (a), Minnesota
State must verify the information provided by the person in the application, determine
whether the person is an eligible person under subdivision 3, and provide a written response
to the person regarding the determination of eligibility. If Minnesota State determines that
the person is not an eligible person, Minnesota State must new text begin specify the reason or reasons for
its determination and, if applicable, new text end include a copy of any documentation identified in
subdivision 3, paragraph (b), in its written response to the person.

(c) If Minnesota State determines that the person is an eligible person under subdivision
3, Minnesota State must forward to the executive director:

(1) the application;

(2) confirmation or modification of the information provided by the eligible person in
the application;

(3) salary history for the eligible person;

(4) an estimate of the amount available for transfer from the eligible person's account
in the individual retirement account plan to the Teachers Retirement Association; and

(5) any other relevant information.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective retroactively from January 1, 2025.
new text end

ARTICLE 4

FIRE AND POLICE STATE AID

Section 1.

Minnesota Statutes 2024, section 423A.022, subdivision 2, is amended to read:

Subd. 2.

Allocation.

(a) Of the total amount appropriated as supplemental state aid:

(1) 58.064 percent must be paid to the executive director of the Public Employees
Retirement Association for deposit in the public employees police and fire retirement fund
established by section 353.65, subdivision 1;

(2) 35.484 percent must be paid to municipalities deleted text begin other than municipalities solely
employing firefighters with retirement coverage provided by the public employees police
and fire retirement plan which deleted text end new text begin defined in paragraph (b) that new text end qualified to receive fire state
aid in that calendar year, allocated in new text begin the same new text end proportion deleted text begin to deleted text end new text begin that new text end the most recent amount
of fire state aid paid under section 477B.04, for the municipality bears to the most recent
total fire state aid new text begin paid new text end for all municipalities other than the municipalities solely employing
firefighters with retirement coverage provided by new text begin a pension plan administered by new text end the Public
Employees deleted text begin police and fire deleted text end Retirement deleted text begin plan paid under section 477B.04 deleted text end new text begin Association new text end , deleted text begin with
the allocated amount for fire departments participating in the statewide lump-sum volunteer
firefighter plan paid to the executive director of the Public Employees Retirement Association
for deposit in the fund established by section 353G.02, subdivision 3, and credited to the
respective account and with the balance paid to the treasurer of each municipality for
transmittal within 30 days of receipt to the treasurer of the applicable firefighters relief
association for deposit in its special fund deleted text end new text begin other than the statewide volunteer firefighter plan new text end ;
and

(3) 6.452 percent must be paid to the executive director of the Minnesota State Retirement
System for deposit in the state patrol retirement fund.

new text begin (b) The allocated amount under paragraph (a), clause (2), must be paid: (i) to the executive
director of the Public Employees Retirement Association for each fire department
participating in the statewide volunteer firefighter plan for deposit in the fund established
by section 352G.02, subdivision 3, and credited to the fire department's account; and (ii)
with the balance to the treasurer of each municipality for transmittal within 30 days of
receipt to the treasurer of the applicable firefighters relief association for deposit in its
special fund.
new text end

deleted text begin (b) deleted text end new text begin (c) new text end For purposes of this section, the term "municipalities" includes independent
nonprofit firefighting corporations that participate in the statewide deleted text begin lump-sum deleted text end volunteer
firefighter plan under chapter 353G or with subsidiary deleted text begin volunteer deleted text end firefighter relief associations
operating under chapter 424A.

Sec. 2.

Minnesota Statutes 2024, section 423A.022, subdivision 3, is amended to read:

Subd. 3.

Reporting.

On or before September 1, annually, the executive director of the
Public Employees Retirement Association shall report to the commissioner of revenue the
following:

(1) the municipalities deleted text begin which deleted text end new text begin that new text end employ firefighters with retirement coverage by the
public employees police and fire retirement plan;

new text begin (2) the municipalities that employ firefighters with retirement coverage by the general
employees retirement plan;
new text end

deleted text begin (2) deleted text end new text begin (3) new text end the fire departments covered by the statewide deleted text begin lump-sum deleted text end volunteer firefighter
plan; and

deleted text begin (3) deleted text end new text begin (4) new text end any other information requested by the commissioner to administer the police
and firefighter retirement supplemental state aid program.

Sec. 3.

Minnesota Statutes 2024, section 424A.014, subdivision 5, is amended to read:

Subd. 5.

Report by certain municipalities; exceptions.

(a) The chief administrative
officer of each municipality that has a fire department but does not have a relief association
governed by sections 424A.091 to 424A.095 or Laws 2014, chapter 275, article 2, section
23, and that is not exempted under paragraph (b) or (c) must annually prepare a detailed
financial report of the receipts and disbursements by the municipality for fire protection
service during the preceding calendar year on a form prescribed by the state auditor. The
financial report must contain any information that the state auditor deems necessary to
disclose the sources of receipts and the purpose of disbursements for fire protection service.
The financial report must be signed by the municipal clerk or clerk-treasurer with the state
auditor on or before July 1 annually. The municipality does not qualify initially to receive,
and is not entitled subsequently to retain, any fire state aid and police and firefighter
retirement supplemental state aid payable under chapter 477B and section 423A.022 if the
financial reporting requirement or the applicable requirements of any other statute or special
law have not been complied with or are not fulfilled.

(b) Each municipality that has a fire department and provides retirement coverage to its
firefighters through the statewide volunteer firefighter plan under chapter 353G qualifies
to have fire state aid transmitted to and retained in the statewide volunteer firefighter
retirement fund without filing a detailed financial report if the executive director of the
Public Employees Retirement Association certifies compliance by the municipality with
the requirements of sections 353G.04 and 353G.08, subdivision 1, paragraph (e), and certifies
compliance by the applicable fire chief with the requirements of section 353G.07.

(c) Each municipality qualifies to receive fire state aid under chapter 477B without filing
a financial report under paragraph (a) if the municipality:

(1) has a fire department;

(2) does not have a firefighters relief association directly associated with its fire
department;

(3) does not participate in the statewide volunteer firefighter retirement plan under
chapter 353G;

(4) provides retirement coverage to its firefighters through the new text begin general employees
retirement plan under chapter 353 or the new text end public employees police and fire retirement plan
under sections 353.63 to 353.68; and

(5) is certified by the executive director of the Public Employees Retirement Association
to the state auditor to have had an employer contribution under section new text begin 353.27, subdivisions
3 and 3a, or new text end 353.65, subdivision 3, for its firefighters for the immediately prior calendar
year equal to or greater than its fire state aid for the immediately prior calendar year.

Sec. 4.

Minnesota Statutes 2024, section 424A.08, is amended to read:

424A.08 MUNICIPALITY WITHOUT RELIEF ASSOCIATION; AUTHORIZED
DISBURSEMENTS.

(a) deleted text begin Any deleted text end new text begin A new text end municipality deleted text begin which deleted text end new text begin that new text end is entitled to receive fire state aid deleted text begin but which has no deleted text end
new text begin must deposit the fire state aid in a special account established for that purpose in the
municipal treasury and disburse the fire state aid in accordance with paragraph (b) or (c),
as applicable, if the municipality's fire department is not directly associated with a new text end firefighters
relief association deleted text begin directly associated with its fire department deleted text end and deleted text begin which deleted text end new text begin is not a participating
employer in the statewide volunteer firefighter plan under chapter 353G.
new text end

new text begin (b) If the municipality new text end has no deleted text begin full-time deleted text end firefighters with retirement coverage by the public
employees police and fire retirement plan deleted text begin shall deposit the fire state aid in a special account
established for that purpose in the municipal treasury. Disbursement deleted text end new text begin and no part-time
firefighters with retirement coverage by the general employees retirement plan under chapter
353, the municipality must not disburse fire state aid new text end from the special account deleted text begin may not be
made deleted text end for any purpose except:

(1) payment of the fees, dues and assessments to the Minnesota State Fire Department
Association and to the state Volunteer Firefighters Benefit Association in order to entitle
its firefighters to membership in and the benefits of these state associations;

(2) payment of the cost of purchasing and maintaining needed equipment for the fire
department; and

(3) payment of the cost of construction, acquisition, repair, or maintenance of buildings
or other premises to house the equipment of the fire department.

deleted text begin (b) A deleted text end new text begin (c) If the new text end municipality deleted text begin which is entitled to receive fire state aid, which has no
firefighters relief association directly associated with its fire department, which does not
participate in the statewide volunteer firefighter plan under chapter 353G, and which deleted text end has
deleted text begin full-time deleted text end firefighters with retirement coverage by the public employees police and fire
retirement plan new text begin or part-time firefighters with retirement coverage by the general employees
retirement plan or both full-time and part-time firefighters with the applicable retirement
coverage, the municipality new text end may disburse the fire state aid deleted text begin as deleted text end new text begin :
new text end

new text begin (1) as new text end provided in paragraph deleted text begin (a), deleted text end new text begin (b);
new text end

new text begin (2) new text end for the payment of deleted text begin the deleted text end employer deleted text begin contribution requirement with respect to deleted text end new text begin contributions
under section 353.65, subdivision 3, for any new text end firefighters covered by the public employees
police and fire retirement plan deleted text begin under section 353.65, subdivision 3, deleted text end new text begin ;
new text end

new text begin (3) for the payment of employer contributions for any firefighters covered by the general
employees retirement plan under section 353.27, subdivisions 3 and 3a; new text end or

new text begin (4) new text end for a combination of the deleted text begin two types of disbursements deleted text end new text begin payments authorized under
clauses (1) to (3) new text end .

deleted text begin (c) deleted text end new text begin (d) new text end A municipality that has no firefighters relief association directly associated with
it and that participates in the statewide volunteer firefighter plan under chapter 353G shall
transmit any fire state aid that it receives to the statewide volunteer firefighter fund.

Sec. 5.

Minnesota Statutes 2024, section 477B.02, subdivision 3, is amended to read:

Subd. 3.

Benefits requirements.

(a) The fire department must:

(1) be associated with a firefighters relief association that provides retirement benefits;

(2) participate in new text begin and have firefighters receiving credit for service toward a retirement
benefit under new text end the statewide volunteer firefighter plan;

(3) have retirement coverage under the public employees police and fire retirement plan
new text begin or the Public Employees Retirement Association general employees retirement plan new text end for the
new text begin fire new text end department's full-time firefighters, as defined in section 299N.03, subdivision 5, deleted text begin or the
fire department's deleted text end part-time firefighters, or deleted text begin the fire department's deleted text end new text begin both new text end full-time firefighters
and part-time firefighters; or

(4) satisfy either clauses (1) and (3) or clauses (2) and (3).

(b) For purposes of retirement benefits, a fire department may be associated with only
one firefighters relief association or one account in the statewide firefighters retirement plan
at one time.

(c) Notwithstanding paragraph (a), a municipality without a relief association as described
under section 424A.08, paragraph (a), may still qualify to receive fire state aid if all other
requirements of this section are met.

Sec. 6.

Minnesota Statutes 2024, section 477B.02, subdivision 8, is amended to read:

Subd. 8.

PERA certification to commissioner.

new text begin (a) new text end On or before February 1 each year,
the executive director of the Public Employees Retirement Association must certify to the
commissioner the fire departments that transferred retirement coverage to, or terminated
participation in, the deleted text begin voluntary deleted text end statewide volunteer firefighter retirement plan since the
previous certification under this paragraph. This certification must include the number of
active deleted text begin volunteer deleted text end firefighters under section 477B.03, subdivision 5, paragraph (e).

new text begin (b) On or before February 1 each year, the executive director of the Public Employees
Retirement Association must certify to the commissioner:
new text end

new text begin (1) the fire departments that participate in the statewide volunteer firefighter plan and
have no firefighters receiving credit for service toward a retirement benefit under the
statewide volunteer firefighter plan; and
new text end

new text begin (2) the fire departments that employ part-time firefighters who are covered by the general
employees retirement plan.
new text end

Sec. 7.

Minnesota Statutes 2024, section 477B.03, subdivision 5, is amended to read:

Subd. 5.

Minimum fire state aid allocation amount.

(a) The minimum fire state aid
allocation amount is the amount derived from any additional funding amount to support a
minimum fire state aid amount under section 423A.02, subdivision 3. The minimum fire
state aid allocation amount is allocated to municipalities or independent nonprofit firefighting
corporations with deleted text begin volunteer deleted text end firefighters' relief associations or covered by the statewide
volunteer firefighter plan. The amount is based on the number of active deleted text begin volunteer deleted text end firefighters
who are (1) members of the relief association as reported to the Office of the State Auditor
in a specific annual financial reporting year as specified in paragraphs (b) to (d), or (2)
covered by the statewide volunteer firefighter plan as specified in paragraph (e).

(b) For relief associations established in calendar year 1993 or a prior year, the number
of active deleted text begin volunteer deleted text end firefighters equals the number of active deleted text begin volunteer deleted text end firefighters who were
members of the relief association as reported in the annual financial reporting for calendar
year 1993, but not to exceed 30 active deleted text begin volunteer deleted text end firefighters.

(c) For relief associations established in calendar year 1994 through calendar year 1999,
the number of active deleted text begin volunteer deleted text end firefighters equals the number of active deleted text begin volunteer deleted text end firefighters
who were members of the relief association as reported in the annual financial reporting for
calendar year 1998 to the Office of the State Auditor, but not to exceed 30 active deleted text begin volunteer deleted text end
firefighters.

(d) For relief associations established after calendar year 1999, the number of active
deleted text begin volunteer deleted text end firefighters equals the number of active deleted text begin volunteer deleted text end firefighters who are members
of the relief association as reported in the first annual financial reporting submitted to the
Office of the State Auditor, but not to exceed 20 active deleted text begin volunteer deleted text end firefighters.

(e) For a municipality or independent nonprofit firefighting corporation that is providing
retirement coverage for deleted text begin volunteer deleted text end firefighters by the statewide volunteer firefighter plan
under chapter 353G, the number of active deleted text begin volunteer deleted text end firefighters equals the number of active
deleted text begin volunteer deleted text end firefighters of the municipality or independent nonprofit firefighting corporation
covered by the statewide plan as certified by the executive director of the Public Employees
Retirement Association to the commissioner and the state auditor within 30 days of the date
the municipality or independent nonprofit firefighting corporation begins coverage in the
plan, but not to exceed 30 active firefighters.

Sec. 8.

Minnesota Statutes 2024, section 477B.03, subdivision 7, is amended to read:

Subd. 7.

Appeal.

A municipality, an independent nonprofit firefighting corporation, a
deleted text begin fire deleted text end new text begin firefighter new text end relief association, or the statewide volunteer firefighter plan may object to
the amount of fire state aid apportioned to it by filing a written request with the commissioner
to review and adjust the apportionment of funds within the state. The objection of a
municipality, an independent nonprofit firefighting corporation, a deleted text begin fire deleted text end new text begin firefighter new text end relief
association, or the deleted text begin voluntary deleted text end statewide volunteer firefighter retirement plan must be filed
with the commissioner within 60 days of the date the amount of apportioned fire state aid
is paid. The decision of the commissioner is subject to appeal, review, and adjustment by
the district court in the county in which the applicable municipality or independent nonprofit
firefighting corporation is located or by the Ramsey County District Court with respect to
the statewide volunteer firefighter plan.

Sec. 9.

Minnesota Statutes 2024, section 477B.04, subdivision 3, is amended to read:

Subd. 3.

Deposit of state aid.

(a) This paragraph applies if the municipality or the
independent nonprofit firefighting corporation deleted text begin is deleted text end new text begin has firefighters new text end covered by the statewide
volunteer firefighter plan. If this paragraph applies and the executive director of the Public
Employees Retirement Association has not approved an aid allocation plan under section
477B.041, the executive director must credit the fire state aid against future municipal
contribution requirements under section 353G.08 and must notify the municipality or the
independent nonprofit firefighting corporation of the fire state aid so credited at least
annually. If this paragraph applies and the executive director has approved an aid allocation
plan under section 477B.041, the executive director must allocate fire state aid in the manner
described under section 477B.041.

(b) If (1) the municipality or the independent nonprofit firefighting corporation deleted text begin is deleted text end new text begin does
new text end not new text begin have firefighters new text end covered by the statewide volunteer firefighter plan and is affiliated
with a duly incorporated firefighters relief association, (2) the relief association has filed a
financial report with the municipality pursuant to section 424A.014, subdivision 1 or 2,
whichever applies, and (3) there is not an aid allocation agreement under section 477B.042
in effect, then the treasurer of the municipality must, within 30 days after receipt, transmit
the fire state aid to the treasurer of the relief association. If clauses (1) and (2) are satisfied
and there is an aid allocation agreement under section 477B.042 in effect, then fire state aid
must be transmitted as described in that section. If the relief association has not filed a
financial report with the municipality, then, regardless of whether an aid allocation agreement
is in effect, the treasurer of the municipality must delay transmission of the fire state aid to
the relief association until the complete financial report is filed.

(c) The treasurer of the municipality must deposit the fire state aid money in the municipal
treasury if (1) the municipality or independent nonprofit firefighting corporation deleted text begin is deleted text end new text begin does new text end not
new text begin have firefighters new text end covered by the statewide volunteer firefighter plan, (2) there is no relief
association organized, (3) the association has dissolved, or (4) the association has been
removed as trustees of state aid. The money may be disbursed from the municipal treasury
only for the purposes and in the manner set forth in section 424A.08 or for the payment of
the employer contribution requirement with respect to firefighters covered by the public
employees police and fire retirement plan under section 353.65, subdivision 3.

Sec. 10.

Minnesota Statutes 2024, section 477B.04, subdivision 4, is amended to read:

Subd. 4.

Aid amount corrections.

(a) deleted text begin An deleted text end new text begin The commissioner must make any new text end adjustment
needed to correct a fire state aid overpayment or underpayment due to a clerical error deleted text begin must
be made deleted text end to subsequent fire state aid payments as provided in paragraphs (b) and (c). The
new text begin commissioner's new text end authority to correct an aid payment under this subdivision is limited to three
years after the payment was issued.

(b) If an overpayment equals more than ten percent of the most recently paid aid amount,
the commissioner must reduce the aid a municipality or independent nonprofit firefighting
corporation is to receive by the amount overpaid over a period of no more than three years.
If an overpayment equals or is less than ten percent of the most recently paid aid amount,
the commissioner must reduce the next aid payment occurring in 30 days or more by the
amount overpaid.

(c) In the event of an underpayment, the commissioner must distribute the amount of
underpaid funds to the municipality or independent nonprofit firefighting corporation over
a period of no more than three years. An additional distribution to a municipality or
independent nonprofit firefighting corporation must be paid from the general fund and must
not diminish the payments made to other municipalities or independent nonprofit firefighting
corporations under this chapter.

Sec. 11. new text begin EFFECTIVE DATE.
new text end

new text begin Sections 1 to 10 are effective beginning with aids payable in 2026.
new text end

ARTICLE 5

STATE BOARD OF INVESTMENT

Section 1.

Minnesota Statutes 2024, section 11A.07, subdivision 4, is amended to read:

Subd. 4.

Duties and powers.

The director, at the direction of the state board, shall:

(1) plan, direct, coordinate, and execute administrative and investment functions in
conformity with the policies and directives of the state board and the requirements of this
chapter and of chapter 356A;

(2) prepare and submit biennial and annual budgets to the board and with the approval
of the board submit the budgets to the Department of Management and Budget;

(3) employ professional and clerical staff as necessary;

(4) report to the state board on all operations under the director's control and supervision;

(5) maintain accurate and complete records of securities transactions and official
activities;

(6) establish a policy, which is subject to state board approval, relating to the purchase
and sale of securities on the basis of competitive offerings or bids;

(7) cause securities acquired to be kept in the custody of the commissioner of management
and budget or other depositories consistent with chapter 356A, as the state board deems
appropriate;

(8) prepare and file with the director of the Legislative Reference Library deleted text begin , by December
31 of each year, deleted text end a report summarizing the activities of the state board, the council, and the
director during the preceding fiscal year;

(9) include on the state board's website its annual report and an executive summary of
its quarterly reports;

(10) require state officials from any department or agency to produce and provide access
to any financial documents the state board deems necessary in the conduct of its investment
activities;

(11) receive and expend legislative appropriations; and

(12) undertake any other activities necessary to implement the duties and powers set
forth in this subdivision consistent with chapter 356A.

Sec. 2.

Minnesota Statutes 2024, section 11A.07, subdivision 4b, is amended to read:

Subd. 4b.

Annual report.

The report required under subdivision 4, clause (8), must
include an executive summary new text begin , must be prepared and filed after the completion of the
applicable fiscal year audit but no later than March 31 of each year, new text end and must be prepared
so as to provide the legislature and the people of the state with:

(1) a clear, comprehensive summary of the portfolio composition, the transactions, the
total annual rate of return, and the yield to the state treasury and to each of the funds with
assets invested by the state board; and

(2) the recipients of business placed or commissions allocated among the various
commercial banks, investment bankers, money managers, and brokerage organizations and
the amount of these commissions or other fees.

Sec. 3. new text begin REPEALER.
new text end

new text begin Minnesota Statutes 2024, section 11A.27, new text end new text begin is repealed.
new text end

Sec. 4. new text begin EFFECTIVE DATE.
new text end

new text begin Sections 1 to 3 are effective the day following final enactment.
new text end

ARTICLE 6

PUBLIC EMPLOYEES DEFINED CONTRIBUTION PLAN

Section 1.

Minnesota Statutes 2024, section 353D.01, subdivision 2, is amended to read:

Subd. 2.

Eligibility.

(a) Eligibility to participate in the plan is available to:

(1) any elected or appointed local government official of a governmental subdivision
who elects to participate in the plan under section 353D.02, subdivision 1, and who, for the
service rendered to a governmental subdivision, is not a member of the association within
the meaning of section 353.01, subdivision 7;

(2) physicians who, if they did not elect to participate in the plan under section 353D.02,
subdivision 2, would meet the definition of member under section 353.01, subdivision 7;

(3) basic and advanced life-support emergency medical service personnel who are
employed by any public ambulance service that elects to participate under section 353D.02,
subdivision 3;

(4) members of a municipal rescue squad associated with the city of Litchfield in Meeker
County, or of a county rescue squad associated with Kandiyohi County, if an independent
nonprofit rescue squad corporation, incorporated under chapter 317A, performing emergency
management services, and if not affiliated with a fire department or ambulance service and
if its members are not eligible for membership in that fire department's or ambulance service's
relief association or comparable pension plan;

new text begin (5) members of the municipal rescue squad associated with the city of Eden Valley in
Stearns and Meeker Counties who are not eligible for membership in the police and fire
retirement plan or a firefighter relief association affiliated with the city and who elect to
participate in the plan under section 353D.02, subdivision 4, paragraph (b);
new text end

deleted text begin (5) deleted text end new text begin (6) new text end employees of the Port Authority of the city of St. Paul who elect to participate
in the plan under section 353D.02, subdivision 5, and who are not members of the association
under section 353.01, subdivision 7;

deleted text begin (6) deleted text end new text begin (7) new text end city managers who elected to be excluded from the general employees retirement
plan of the association under section 353.028 and who elected to participate in the public
employees defined contribution plan under section 353.028, subdivision 3, paragraph (b);

deleted text begin (7) deleted text end new text begin (8) new text end volunteer or emergency on-call firefighters serving in a municipal fire department
or an independent nonprofit firefighting corporation who are not covered by the police and
fire retirement plan and who are not covered by a firefighters relief association and who
elect to participate in the public employees defined contribution plan;

deleted text begin (8) deleted text end new text begin (9) new text end any elected county sheriff who is a former member of the police and fire plan,
is receiving a retirement annuity as provided under section 353.651, deleted text begin who deleted text end new text begin and new text end does not have
previous employment with the county for which the sheriff was elected; and

deleted text begin (9) deleted text end new text begin (10) new text end persons appointed to serve on a board or commission of a governmental
subdivision or an instrumentality thereof.

(b) Individuals otherwise eligible to participate in the plan under this subdivision who
are currently covered by a public or private pension plan because of their employment or
provision of services are not eligible to participate in the deleted text begin public employees defined
contribution deleted text end plan.

(c) A former participant is a person who has terminated eligible employment or service
and has not withdrawn the value of the person's individual account.

Sec. 2.

Minnesota Statutes 2024, section 353D.02, subdivision 4, is amended to read:

Subd. 4.

Eligible rescue squad deleted text begin personnel deleted text end new text begin members new text end .

new text begin (a) new text end The municipality or county,
as applicable, associated with a rescue squad under section 353D.01, subdivision 2, paragraph
(a), clause (4), may elect to participate in the plan. If the municipality or county, as applicable,
elects to participate, the eligible personnel may elect to participate or decline to participate.
An eligible individual's election must be made within 30 days of the service's election to
participate or within 30 days of the date on which the individual first began employment
with the rescue squad, whichever is later. deleted text begin Elections under this subdivision by a government
unit or individual are irrevocable. deleted text end The municipality or county, as applicable, must specify
by resolution eligibility requirements for rescue squad personnel which must be satisfied if
the individual is to be authorized to make the election under this subdivision.

new text begin (b) An eligible member under section 353D.01, subdivision 2, paragraph (a), clause (5),
may elect to participate or decline to participate in the plan within 30 days of the date on
which the member first begins service with the rescue squad.
new text end

new text begin (c) Elections under this subdivision by a government unit or individual are irrevocable.
new text end

Sec. 3. new text begin EFFECTIVE DATE.
new text end

new text begin Sections 1 and 2 are effective the day following final enactment.
new text end

ARTICLE 7

MISCELLANEOUS TECHNICAL CORRECTIONS

Section 1.

Minnesota Statutes 2024, section 124E.12, subdivision 4, is amended to read:

Subd. 4.

Teacher and other employee retirement.

(a) Teachers in a charter school
must be public school teachers for the purposes of chapters 354 and 354A deleted text begin governing the
Teacher Retirement Act deleted text end .

(b) Except for teachers under paragraph (a), employees in a charter school must be public
employees for the purposes of chapter 353 deleted text begin governing the Public Employees Retirement
Act deleted text end .

Sec. 2.

Minnesota Statutes 2024, section 124E.12, subdivision 6, is amended to read:

Subd. 6.

Leave to teach in a charter school.

If a teacher employed by a district makes
a written request for an extended leave of absence to teach at a charter school, the district
must grant the leave. The district must grant a leave not to exceed a total of five years. Any
request to extend the leave shall be granted only at the discretion of the school board. The
district may require a teacher to make the request for a leave or extension of leave before
February 1 in the school year preceding the school year in which the teacher intends to
leave, or February 1 of the calendar year in which the teacher's leave is scheduled to
terminate. Except as otherwise provided in this subdivision and section 122A.46, subdivision
7, governing employment in another district, the leave is governed by section 122A.46,
including, but not limited to, reinstatement, notice of intention to return, seniority, salary,
and insurance.

During a leave, the teacher may continue to deleted text begin aggregate benefits and credits deleted text end new text begin earn service
and salary credit toward a pension new text end in the Teachers' Retirement Association deleted text begin account deleted text end new text begin or the
St. Paul Teachers Retirement Fund Association new text end under chapters 354 and 354A, new text begin respectively,
new text end consistent with subdivision 4.

Sec. 3.

Minnesota Statutes 2024, section 181.101, is amended to read:

181.101 WAGES; HOW OFTEN PAID.

(a) Except as provided in paragraph (b), every employer must pay all wages, including
salary, earnings, and gratuities earned by an employee at least once every 31 days and all
commissions earned by an employee at least once every three months, on a regular payday
designated in advance by the employer regardless of whether the employee requests payment
at longer intervals. Unless paid earlier, the wages earned during the first half of the first
31-day pay period become due on the first regular payday following the first day of work.
If wages or commissions earned are not paid, the commissioner of labor and industry or the
commissioner's representative may serve a demand for payment on behalf of an employee.
In addition to other remedies under section 177.27, if payment of wages is not made within
ten days of service of the demand, the commissioner may charge and collect the wages
earned at the employee's rate or rates of pay or at the rate or rates required by law, including
any applicable statute, regulation, rule, ordinance, government resolution or policy, contract,
or other legal authority, whichever rate of pay is greater, and a penalty in the amount of the
employee's average daily earnings at the same rate or rates for each day beyond the ten-day
limit following the demand. If payment of commissions is not made within ten days of
service of the demand, the commissioner may charge and collect the commissions earned
and a penalty equal to 1/15 of the commissions earned but unpaid for each day beyond the
ten-day limit. Money collected by the commissioner must be paid to the employee concerned.
This section does not prevent an employee from prosecuting a claim for wages. This section
does not prevent a school district, other public school entity, or other school, as defined
under section 120A.22, from paying any wages earned by its employees during a school
year on regular paydays in the manner provided by an applicable contract or collective
bargaining agreement, or a personnel policy adopted by the governing board. For purposes
of this section, "employee" includes a person who performs agricultural labor as defined in
section 181.85, subdivision 2. For purposes of this section, wages are earned on the day an
employee works. This section provides a substantive right for employees to the payment of
wages, including salary, earnings, and gratuities, as well as commissions, in addition to the
right to be paid at certain times.

(b) An employer of a volunteer new text begin or paid on-call new text end firefighter, as defined in section 424A.001,
subdivision 10, a member of an organized first responder squad that is formally recognized
by a political subdivision in the state, or a volunteer ambulance driver or attendant must
pay all wages earned by the volunteer firefighter, first responder, or volunteer ambulance
driver or attendant at least once every 31 days, unless the employer and the employee
mutually agree upon payment at longer intervals.

Sec. 4.

Minnesota Statutes 2024, section 356.633, subdivision 1, is amended to read:

Subdivision 1.

Definitions.

(a) For purposes of this section, the following terms have
the meanings given.

new text begin (b) "Covered retirement plan" means a pension or retirement plan listed in section
356.611, subdivision 6, and the Minnesota deferred compensation plan established under
section 352.965.
new text end

deleted text begin (b) deleted text end new text begin (c) new text end "Distributee" means:

(1) a new text begin member of or new text end participant in a covered retirement plan deleted text begin listed in section 356.611,
subdivision 6 deleted text end ;

(2) the surviving spouse of a new text begin member of or new text end participant new text begin in a covered retirement plan new text end ;

(3) the former spouse of deleted text begin the deleted text end new text begin a member of or new text end participant new text begin in a covered retirement plan new text end who
is the alternate payee under a qualified domestic relations order as defined in section 414(p)
of the Internal Revenue Code, or who is a recipient of a court-ordered equitable distribution
of marital property, as provided in section 518.58; or

(4) a nonspousal beneficiary of a new text begin member of or new text end participant new text begin in a covered retirement plan new text end
who qualifies for a distribution under the plan and is a designated beneficiary as defined in
section 401(a)(9)(E) of the Internal Revenue Code.

deleted text begin (c) deleted text end new text begin (d) new text end "Eligible retirement plan" means:

(1) an individual retirement account under section 408(a) or 408A of the Internal Revenue
Code;

(2) an individual retirement annuity plan under section 408(b) of the Internal Revenue
Code;

(3) an annuity plan under section 403(a) of the Internal Revenue Code;

(4) a qualified trust plan under section 401(a) of the Internal Revenue Code that accepts
deleted text begin the distributee's deleted text end eligible rollover deleted text begin distribution deleted text end new text begin distributions new text end ;

(5) an annuity contract under section 403(b) of the Internal Revenue Code;

(6) an eligible deferred compensation plan under section 457(b) of the Internal Revenue
Code, deleted text begin which deleted text end new text begin including the Minnesota deferred compensation plan, that new text end is maintained by a
state or local government new text begin , accepts eligible rollover distributions, new text end and deleted text begin which deleted text end agrees to
separately account for the amounts transferred into the plan;

(7) deleted text begin in the case of an eligible rollover distribution to a deleted text end new text begin if the distributee is a surviving
spouse or new text end nonspousal beneficiary, an individual account or annuity treated as an inherited
individual retirement account under section 402(c)(11) of the Internal Revenue Code; or

(8) a savings incentive match plan for employees of small employers (SIMPLE) individual
retirement account under section 408(p) of the Internal Revenue Code, provided that the
rollover distribution is made after the two-year period beginning on the date the distributee
first participated in any qualified salary reduction arrangement maintained by the distributee's
employer under section 408(p)(2) of the Internal Revenue Code, as described in section
72(t)(6) of the Internal Revenue Code.

deleted text begin (d) deleted text end new text begin (e) new text end "Eligible rollover distribution" means any distribution of all or any portion of the
balance to the credit of the distributee. An eligible rollover distribution does not include:

(1) a distribution that is one of a series of substantially equal periodic payments,
receivable annually or more frequently, that is made for the life or life expectancy of the
distributee, the joint lives or joint life expectancies of the distributee and the distributee's
designated beneficiary, or for a specified period of ten years or more;

(2) a distribution that is required under section 401(a)(9) of the Internal Revenue Code;
deleted text begin or
deleted text end

new text begin (3) a distribution that is less than $200; or
new text end

deleted text begin (3) deleted text end new text begin (4) new text end any other exception required by law or the Internal Revenue Code.

Sec. 5.

Minnesota Statutes 2024, section 356.633, subdivision 2, is amended to read:

Subd. 2.

Right to elect direct rollover.

Except as provided in subdivision 3 for after-tax
contributions, a distributee may elect, at the time and in the manner prescribed by the plan
administrator, to have all or any portion of an eligible rollover distribution new text begin from a covered
retirement plan new text end paid directly to an eligible retirement plan as specified by the distributee.

Sec. 6.

Minnesota Statutes 2024, section 356.633, is amended by adding a subdivision to
read:

new text begin Subd. 4. new text end

new text begin Notice. new text end

new text begin A covered retirement plan must provide the distributee of an eligible
rollover distribution from the covered retirement plan with the notice required by section
402(f) of the Internal Revenue Code within the time period prior to making the eligible
rollover distribution, as required by regulations issued pursuant to section 402(f) of the
Internal Revenue Code.
new text end

Sec. 7.

new text begin [356.638] MILITARY SERVICE.
new text end

new text begin A covered retirement plan as defined in section 356.633, subdivision 1, paragraph (b),
must require contributions and provide benefits, including death and disability benefits
under section 401(a)(37) of the Internal Revenue Code, and service credit with respect to
qualified military service according to section 414(u) of the Internal Revenue Code. If a
member dies while the member is performing qualified military service as defined in United
States Code, title 38, chapter 43, to the extent required by section 401(a)(37) of the Internal
Revenue Code, survivors of the member are entitled to any additional benefits that the
covered retirement plan would have provided if the member had resumed employment and
then died, including but not limited to accelerated vesting or survivor benefits that are
contingent on the member's death while employed. A deceased member's period of qualified
military service must be counted for vesting purposes.
new text end

Sec. 8.

Minnesota Statutes 2024, section 424B.22, subdivision 1, is amended to read:

Subdivision 1.

Application.

(a) Notwithstanding any laws to the contrary, this section
applies to:

(1) the termination of a retirement plan established and administered by a relief
association, whether or not the relief association is also dissolved or eliminated; and

(2) the dissolution of a relief association that is not consolidating with another relief
association under sections 424B.01 to 424B.10.

new text begin (b) new text end This section does not apply to the dissolution of a relief association or the termination
of a retirement plan that occurs due to the change in retirement coverage from a retirement
plan administered by a relief association to the Public Employees Retirement Association
statewide volunteer firefighter plan under section 353G.06.

deleted text begin (b) To terminate a retirement plan, the board of trustees must comply with subdivisions
3, 5 to 11, and, if desired, subdivision 4.
deleted text end

deleted text begin (c) To dissolve a relief association, the board of trustees of the relief association must:
deleted text end

deleted text begin (1) terminate the retirement plan in accordance with paragraph (b);
deleted text end

deleted text begin (2) determine all legal obligations of the special and general funds of the relief association,
as required by subdivision 5;
deleted text end

deleted text begin (3) take the actions required by subdivision 12; and
deleted text end

deleted text begin (4) comply with the requirements governing dissolution of nonprofit corporations under
chapter 317A.
deleted text end

deleted text begin (d) A relief association that terminates its retirement plan must liquidate its special fund
as provided in subdivision 8, but need not liquidate its general fund if the relief association
is not being dissolved.
deleted text end

Sec. 9.

Minnesota Statutes 2024, section 424B.22, is amended by adding a subdivision to
read:

new text begin Subd. 1a. new text end

new text begin Voluntary dissolution and termination. new text end

new text begin (a) To terminate a retirement plan,
the board of trustees must comply with subdivisions 3, 5 to 11, and, if desired, subdivision
4.
new text end

new text begin (b) To dissolve a relief association, the board of trustees of the relief association must:
new text end

new text begin (1) terminate the retirement plan in accordance with paragraph (a);
new text end

new text begin (2) determine all legal obligations of the special and general funds of the relief association,
as required by subdivision 5;
new text end

new text begin (3) take the actions required by subdivision 12; and
new text end

new text begin (4) comply with the requirements governing dissolution of nonprofit corporations under
chapter 317A.
new text end

new text begin (c) A relief association that terminates its retirement plan must liquidate its special fund
as provided in subdivision 8, but need not liquidate its general fund if the relief association
is not being dissolved.
new text end

Sec. 10.

Minnesota Statutes 2024, section 424B.22, subdivision 2, is amended to read:

Subd. 2.

Involuntary dissolution and termination.

(a) A relief association is dissolved
and the retirement plan administered by the relief association is terminated automatically
if:

(1) the fire department affiliated with a relief association is dissolved by action of the
governing body of the municipality in which the fire department is located or by the
governing body of the independent nonprofit firefighting corporation, whichever applies;
deleted text begin or
deleted text end

(2) the fire department affiliated with a relief association has terminated the employment
or services of all active members of the relief association deleted text begin . deleted text end new text begin ; or
new text end

new text begin (3) the governing body with which the fire department is affiliated has resolved to transfer
the fire department's active part-time firefighters who are members of the relief association
to the public employees police and fire retirement plan and filed the resolution with the
Public Employees Retirement Association, and the relief association will have no remaining
active firefighters when the transfer is completed.
new text end

(b) An involuntary termination of a relief association under this subdivision is effective
on the December 31 that is at least eight months after the date on which the fire department
is dissolved or the termination of employment or services of all active members of the relief
association occurs.

new text begin (c) new text end The board of trustees must comply with subdivisions 3 and 5 to 12. The board of
trustees may comply with subdivision 4. The state auditor has the discretion to waive these
requirements if the board of trustees requests a waiver in advance and provides adequate
demonstration that meeting these requirements is not practicable.

deleted text begin (c) deleted text end new text begin (d) new text end The retirement plan administered by a relief association is terminated automatically
if the relief association is dissolved, effective on the date of the dissolution of the relief
association.

Sec. 11.

Minnesota Statutes 2024, section 424B.22, subdivision 3, is amended to read:

Subd. 3.

Retirement plan termination date, full vesting, and forfeitures.

(a) Unless
subdivision 2 applies, the effective date of the termination of a retirement plan is the date
approved by the board of trustees of the relief association. If the board of trustees does not
approve a termination date, the effective date of the termination of a retirement plan is the
effective date of the dissolution of the relief association or, if the relief association is not
being dissolved, the end of the calendar year in which the termination of employment or
services of all active members of the relief association occurs.

(b) As deleted text begin of the earlier of the retirement plan termination date or the date on which the
termination of employment or services of all active members of the relief association occurs deleted text end new text begin
required by section 356.001, subdivision 3 new text end , each deleted text begin participant becomes fully (100 percent) deleted text end new text begin
member must become 100 percent new text end vested in the deleted text begin participant's deleted text end new text begin member's new text end retirement benefit
deleted text begin under deleted text end new text begin accrued and funded to the earlier of new text end the retirement plan new text begin termination date or the date
on which the termination of employment or services of all active members of the relief
association occurs new text end , notwithstanding any bylaws or laws to the contrary deleted text begin , except for deleted text end new text begin . new text end new text begin For
purposes of this paragraph:
new text end

new text begin (1) "member" does not mean new text end any retiree in pay status who is receiving a monthly service
pension from a relief association described in section 424A.093 deleted text begin . deleted text end new text begin ; and
new text end

new text begin (2) crediting of interest on deferred service pensions under the terms of the relief
association bylaws ends on the retirement plan termination date.
new text end

(c) If the relief association is a defined contribution relief association, the account of
each participant who becomes 100 percent vested under paragraph (b) shall include an
allocation of any forfeiture that is required, under the bylaws of the relief association, to
occur on or as of the end of the calendar year during which the termination of the retirement
plan is effective, if the participant is entitled to an allocation of forfeitures under the bylaws.
Any account so forfeited shall not be included in the retirement benefits that become 100
percent vested under paragraph (b).

Sec. 12. new text begin REPEALER.
new text end

new text begin Minnesota Statutes 2024, section 356.635, subdivision 9, new text end new text begin is repealed.
new text end

Sec. 13. new text begin EFFECTIVE DATE.
new text end

new text begin Sections 1 to 12 are effective the day following final enactment.
new text end

APPENDIX

Repealed Minnesota Statutes: 25-05537

11A.27 REPORT ON INVESTMENT CONSULTANT ACTIVITIES AND DELIVERABLES.

(a) Annually, on or before November 1, the State Board of Investment shall file a report with the Legislative Reference Library on the activities and work product during that year of any investment consultants retained by the board.

(b) The report must include the following items:

(1) the total contract fee paid to each investment consultant;

(2) a listing of the projects in which the investment consultant was involved; and

(3) examples of the written work product provided by the investment consultant on those projects during the report coverage period.

356.635 INTERNAL REVENUE CODE COMPLIANCE.

Subd. 9.

Military service.

Contributions, benefits, including death and disability benefits under section 401(a)(37) of the federal Internal Revenue Code, and service credit with respect to qualified military service must be provided according to section 414(u) of the federal Internal Revenue Code. For deaths occurring on or after January 1, 2007, while a member is performing qualified military service as defined in United States Code, title 38, chapter 43, to the extent required by section 401(a)(37) of the Internal Revenue Code, survivors of a member in the system are entitled to any additional benefits that the system would have provided if the member had resumed employment and then died, including but not limited to accelerated vesting or survivor benefits that are contingent on the member's death while employed. In any event, a deceased member's period of qualified military service must be counted for vesting purposes.