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HF 2145

as introduced - 92nd Legislature (2021 - 2022) Posted on 03/11/2021 02:45pm

KEY: stricken = removed, old language.
underscored = added, new language.

Current Version - as introduced

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A bill for an act
relating to retirement; State Auditor's fire relief association working group
recommendations; amending Minnesota Statutes 2020, sections 424A.001, by
adding a subdivision; 424A.014, subdivisions 1, 2; 424A.015, subdivision 7;
424A.016, subdivisions 4, 6; 424A.02, subdivision 3; 424A.05, subdivision 3b;
424A.10, subdivision 2.

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

Section 1.

Minnesota Statutes 2020, section 424A.001, is amended by adding a subdivision
to read:


new text begin Subd. 2b. new text end

new text begin Municipal clerk. new text end

new text begin "Municipal clerk" means the person elected or appointed
to the position of municipal clerk, the chief financial official or chief administrative official
designated to perform such function, or, if there is no such person or designation, the chief
financial official, the chief administrative official, or the person primarily responsible for
managing the finances of a municipality.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective the day following final enactment.
new text end

Sec. 2.

Minnesota Statutes 2020, section 424A.014, subdivision 1, is amended to read:


Subdivision 1.

Financial report and audit.

(a) new text beginAn annual financial report and audited
financial statements in accordance with paragraphs (c) to (e) must be submitted by
new text endthe board
of new text begintrustees of new text endthe Bloomington Fire Department Relief Association and new text beginthe board of trustees
of
new text endeach volunteer firefighters relief association with new text beginspecial fund new text endassets of at least $500,000
or new text beginspecial fund new text endliabilities of at least $500,000 deleted text beginin the prior year or in any previous yeardeleted text end,
according to deleted text beginthe applicable actuarial valuation or according to the financial report if no
valuation is required, must prepare a financial report covering the special and general funds
of the relief association for the preceding fiscal year, file the
deleted text end new text beginany previous year's new text endfinancial
reportdeleted text begin, and submit financial statementsdeleted text end.

new text begin (b) The board of trustees of a volunteer firefighters relief association with special fund
assets of less than $500,000 and special fund liabilities of less than $500,000, according to
each previous year's financial report, may submit an annual financial report and audited
financial statements in accordance with paragraphs (c) to (e).
new text end

deleted text begin (b)deleted text end new text begin(c) new text endThe financial report must deleted text begincontain financial statements and disclosures that present
the true financial condition of the relief association and the results of relief association
operations in conformity with generally accepted accounting principles and in compliance
with the regulatory, financing, and funding provisions of this chapter and any other applicable
laws
deleted text endnew text begin cover the relief association's special fund and general fund and be in the style and form
prescribed by the state auditor
new text end. The financial report must be countersigned by:

(1) the municipal clerk or clerk-treasurer of the municipality in which the relief
association is located if the relief association deleted text beginis a firefighters' relief association thatdeleted text end is directly
associated with a municipal fire department;

(2) the municipal clerk or clerk-treasurer of the largest municipality in population that
contracts with the independent nonprofit firefighting corporation if the volunteer firefighter
relief association is a subsidiary of an independent nonprofit firefighting corporation, and
by the secretary of the independent nonprofit firefighting corporation; or

(3) the chief financial official of the county in which the volunteer firefighter relief
association is located or primarily located if the relief association is associated with a fire
department that is not located in or associated with an organized municipality.

deleted text begin (c)deleted text end new text begin(d) new text endThe financial report must be retained in the office of the Bloomington Fire
Department Relief Association or the volunteer firefighter relief association for public
inspection and must be filed with the governing body of the government subdivision in
which the associated fire department is located after the close of the fiscal year. One copy
of the financial report must be furnished to the state auditor new text beginon or before June 30 new text endafter the
close of the fiscal year.

deleted text begin (d)deleted text end new text begin(e) new text endAudited financial statements new text beginthat present the true financial condition of the relief
association's special fund and general fund
new text endmust be attested to by a certified public accountant
or by the state auditor and must be filed with the state auditor on or before June 30 after the
close of the fiscal year. Audits must be conducted in compliance with generally accepted
auditing standards and section 6.65 governing audit procedures. The state auditor may accept
deleted text begin this reportdeleted text end new text beginaudited financial statements new text endin lieu of the new text beginfinancial new text endreport required in paragraph
deleted text begin (c)deleted text endnew text begin (a)new text end.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective January 1, 2022.
new text end

Sec. 3.

Minnesota Statutes 2020, section 424A.014, subdivision 2, is amended to read:


Subd. 2.

Financial statement.

(a) The board of new text begintrustees of new text endeach volunteer firefighter
relief association that is not required to new text beginand does not choose to new text endfile a financial report and
audit under subdivision 1 must prepare a detailed statement of the financial affairs for the
preceding fiscal year of the relief association's special and general funds in the style and
form prescribed by the state auditor. The detailed statement must show:

(1) the sources and amounts of all money received;

(2) all disbursements, accounts payable, and accounts receivable;

(3) the amount of money remaining in the treasury;

(4) total assets, including a listing of all investments;

(5) the accrued liabilities; and

(6) all other items necessary to show accurately the revenues and expenditures and
financial position of the relief association.

(b) The detailed financial statement of the special and general funds required under
paragraph (a) must be certified by a certified public accountant or by the state auditor in
accordance with agreed-upon procedures and forms prescribed by the state auditor. The
accountant must have at least five years of public accounting, auditing, or similar experience
and must not be an active, inactive, or retired member of the relief association or the fire
department.

(c) The detailed financial statement required under paragraph (a) must be countersigned
by:

(1) the municipal clerk or clerk-treasurer of the municipality;

(2) where applicable, the municipal clerk or clerk-treasurer of the largest municipality
in population that contracts with the independent nonprofit firefighting corporation if the
relief association is a subsidiary of an independent nonprofit firefighting corporation, and
by the secretary of the independent nonprofit firefighting corporation; or

(3) the chief financial official of the county in which the volunteer firefighter relief
association is located or primarily located if the relief association is associated with a fire
department that is not located in or associated with an organized municipality.

(d) The volunteer firefighters relief association board must submit a copy of the detailed
financial statement required under paragraph (a) that has been certified by the governing
body of the municipality to the state auditor on or before March 31 after the close of the
fiscal year.

(e) A certified public accountant or auditor who performs the agreed-upon procedures
under paragraph (b) is subject to the reporting requirement of section 6.67.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective January 1, 2022.
new text end

Sec. 4.

Minnesota Statutes 2020, section 424A.015, subdivision 7, is amended to read:


Subd. 7.

Combined service pensions.

(a) A deleted text beginvolunteer firefighterdeleted text end new text beginmember new text endwith credit
for service as an active firefighter in more than one volunteer firefighters relief association
is entitled to a deleted text beginprorateddeleted text end service pension from each new text beginparticipating new text endrelief association if:

(1) the articles of incorporation or bylaws of the relief associations providenew text begin for such
combined service pensions
new text end;

(2) the applicable requirements of paragraphs (b) deleted text beginand (c)deleted text end new text beginto (e) new text endare met; and

(3) the deleted text beginvolunteer firefighterdeleted text end new text beginmember new text endotherwise qualifies.

(b) A deleted text beginvolunteer firefighterdeleted text end new text beginmember new text endreceiving a deleted text beginprorateddeleted text end service pension under this
subdivision must deleted text beginhave a total combined amount of service credit from the two or more relief
associations of ten years or more, unless the bylaws of every affected relief association
specify less than a ten-year service vesting requirement, in which case, the total amount of
required service credit is the longest service vesting requirement of the relief associations
deleted text endnew text begin
be at least partially vested under the bylaws of the first participating relief association on
the date on which the member terminates active service with that relief association. The
service pension paid from the first participating relief association shall be based on the years
of active service accrued in the first relief association and the vesting percentage applicable
to those years of active service
new text end.

new text begin (c) To receive a service pension from each subsequent relief association, the member
must be at least partially vested under the bylaws of the subsequent relief association, taking
into consideration the member's total service credit accrued in all participating relief
associations to the date the member terminates active service with the subsequent relief
association. The service pension paid from each subsequent relief association shall be based
on the years of active service accrued solely in that relief association and the vesting
percentage applicable to the combined amount of total service credit accrued in all of the
participating relief associations.
new text end

new text begin (d) new text endThe member must have one deleted text beginyeardeleted text end or more new text beginyears new text endof service credit in each new text beginparticipating
new text end relief association. The deleted text beginprorateddeleted text end service pension must be based on:

(1) for defined benefit relief associations, the service pension amount in effect for the
relief association on the date on which new text beginthe member's new text endactive volunteer firefighting services
covered by that relief association terminate; and

(2) for defined contribution relief associations, the member's individual account balance
on the date on which new text beginthe member's new text endactive volunteer firefighting services covered by that
relief association terminate.

deleted text begin (c)deleted text end new text begin(e) new text endTo receive a deleted text beginprorateddeleted text end service pension under this subdivision, the deleted text beginfirefighterdeleted text end
new text begin member new text endmust become a member of the deleted text beginsecond or succeedingdeleted text end new text beginsubsequent relief new text endassociation
deleted text begin and must give notice of membership to the prior associationdeleted text end within two years of the date of
termination of active service with the prior new text beginrelief new text endassociation. deleted text beginThe second ordeleted text endnew text begin If requested
by the member or a
new text end subsequent relief associationnew text begin, the new text end secretary new text beginof each prior relief association
new text end must deleted text begincertify thedeleted text end new text beginprovide written new text endnoticenew text begin to the member and the subsequent relief association
regarding the amount of active service accrued by the member in the prior relief association
new text end.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective January 1, 2022.
new text end

Sec. 5.

Minnesota Statutes 2020, section 424A.016, subdivision 4, is amended to read:


Subd. 4.

Individual accounts.

(a) An individual account must be established for each
firefighter who is a member of the relief association.

(b) To each individual active member account must be credited an equal share of:

(1) any amounts of fire state aid and police and firefighter retirement supplemental state
aid received by the relief association;

(2) any amounts of municipal contributions to the relief association raised from levies
on real estate or from other available municipal revenue sources exclusive of fire state aid;
and

(3) any amounts equal to the share of the assets of the special fund to the credit of:

(i) any former member who terminated active service with the fire department to which
the relief association is associated before meeting the minimum service requirement provided
for in subdivision 2, paragraph (b), and new text begineither new text endhas not returned to active service with the
fire department for a period no shorter than five yearsnew text begin or has died and no survivor benefit
or death benefit is payable
new text end; or

(ii) any deleted text beginretireddeleted text end member who deleted text beginretireddeleted text end new text beginterminated active service new text endbefore deleted text beginobtaining a full
nonforfeitable interest in the amounts credited to
deleted text end new text beginbecoming 100 percent vested in new text endthe
deleted text begin individual memberdeleted text end new text beginmember's new text endaccount under subdivision 2, paragraph (b), and any applicable
provision of the bylaws of the relief association.

(c) In addition, any investment return on the assets of the special fund must be credited
in proportion to the share of the assets of the special fund to the credit of each individual
active member account and inactive member account, unless the inactive member is a
deferred member as defined in subdivision 6.

(d) Administrative expenses of the relief association payable from the special fund may
be deducted from individual accounts in a manner specified in the bylaws of the relief
association.

(e) Amounts to be credited to individual accounts new text beginunder paragraph (b) new text endmust be allocated
uniformly for all years of active service and allocations must be made for all years of service,
except for caps on service credit if so provided in the bylaws of the relief association.
Amounts forfeited under paragraph (b), clause (3), before a resumption of active service
and membership under section 424A.01, subdivision 6, remain forfeited and may not be
reinstated upon the resumption of active service and membership. The allocation method
may utilize monthly proration for fractional years of service, as the bylaws or articles of
incorporation of the relief association so provide. The bylaws or articles of incorporation
may define a "month," but the definition must require a calendar month to have at least 16
days of active service. If the bylaws or articles of incorporation do not define a "month," a
"month" is a completed calendar month of active service measured from the member's date
of entry to the same date in the subsequent month.

(f) At the time of retirement under subdivision 2 and any applicable provision of the
bylaws of the relief association, a retiring member is entitled to that portion of the assets of
the special fund to the credit of the member in the individual member account which is
nonforfeitable under subdivision 3 and any applicable provision of the bylaws of the relief
association based on the number of years of service to the credit of the retiring member.

(g) Annually, the secretary of the relief association shall certify the individual account
allocations to the state auditor at the same time that the annual financial statement or financial
report and audit of the relief association, whichever applies, is due under section 424A.014.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective January 1, 2022.
new text end

Sec. 6.

Minnesota Statutes 2020, section 424A.016, subdivision 6, is amended to read:


Subd. 6.

Deferred service pensions.

(a) A "deferred member" means a member of a
relief association who has separated from active service and membership and has completed
the minimum service and membership requirements in subdivision 2. The requirement that
a member separate from active service and membership is waived for persons who have
discontinued their volunteer firefighter duties and who are employed on a full-time basis
under section 424A.015, subdivision 1.

(b) A deferred member is entitled to receive a deferred service pension when the member
reaches at least age 50, or at least the minimum age specified in the bylaws governing the
relief association if that age is greater than age 50, and makes a valid written application.

(c) A defined contribution relief association must credit interest or additional investment
performance on the deferred lump-sum service pension during the period of deferral for all
deferred members on or after January 1, 2021. deleted text beginInterest must be credited using one of the
following methods, as provided for in the
deleted text end new text beginA defined contribution relief association may
specify in its
new text endbylawsnew text begin the method by which it will credit interest or additional investment
performance to the accounts of deferred members. Such method shall be limited to one of
the three methods provided in this paragraph. In the event the bylaws do not specify a
method, the interest or additional investment performance must be credited using the method
defined in clause (3). The permissible methods are
new text end:

(1) at the investment performance rate actually earned on that portion of the assets if the
deferred benefit amount is invested by the relief association in a separate account established
and maintained by the relief association;

(2) at the investment performance rate actually earned on that portion of the assets if the
deferred benefit amount is invested in a separate investment vehicle held by the relief
association; or

(3) at the investment return on the assets of the special fund of the defined contribution
volunteer firefighters relief association in proportion to the share of the assets of the special
fund to the credit of each individual deferred member account through the accounting date
on which the investment return is recognized by and credited to the special fund.

new text begin (d) Notwithstanding the requirements of section 424A.015, subdivision 6, bylaw
amendments made in accordance with paragraph (c) on or before January 1, 2022, shall
apply to members already in deferred status as of January 1, 2021.
new text end

deleted text begin (d)deleted text end new text begin(e) new text endUnless the bylaws deleted text beginofdeleted text end new text beginprovide differently, the dates that will be used by new text enda relief
association deleted text beginthat has elected to pay interest or additional investment performance on deferred
lump-sum service pensions under paragraph (c) specifies a different interest or additional
investment performance method, including the interest or additional investment performance
period starting date and ending date, the
deleted text end new text beginin determining the creditable amount of new text endinterest or
additional investment performance on a deferred service pension deleted text beginis creditabledeleted text end new text beginshall be new text endas
follows:

(1) for a relief association that has elected to credit interest or additional investment
performance under paragraph (c), clause (1) or (3), beginning on the date that the member
separates from active service and membership and ending on the accounting date immediately
before the deferred member commences receipt of the deferred service pension; or

(2) for a relief association that has elected to credit interest or additional investment
performance under paragraph (c), clause (2), beginning on the date that the member separates
from active service and membership and ending on the date that the separate investment
vehicle is valued immediately before the date on which the deferred member commences
receipt of the deferred service pension.

deleted text begin (e) If the bylaws do not define a method for crediting interest or additional investment
performance, the interest or additional investment performance must be credited using the
method defined in paragraph (c), clause (3).
deleted text end

deleted text begin (f) Until December 31, 2020, a defined contribution relief association is permitted, if its
governing bylaws so provide, to credit interest or additional investment performance on the
deferred lump-sum service pension during the period of deferral using the method set forth
in the bylaws applicable on the date on which each deferred member separated from active
service.
deleted text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective retroactively from January 1, 2021.
new text end

Sec. 7.

Minnesota Statutes 2020, section 424A.02, subdivision 3, is amended to read:


Subd. 3.

Flexible service pension maximums.

(a) Annually on or before August 1 as
part of the certification of the financial requirements and minimum municipal obligation
determined under section 424A.092, subdivision 4, or 424A.093, subdivision 5, as applicable,
the secretary or some other official of the relief association designated in the bylaws of each
defined benefit relief association shall calculate and certify to the governing body of the
applicable municipality the average amount of available financing per active covered
firefighter for the most recent three-year period.

The amount of available financing includes any amounts of fire state aid and police and
firefighter retirement supplemental state aid received or receivable by the relief association,
any amounts of municipal contributions to the relief association raised from levies on real
estate or from other available revenue sources exclusive of fire state aid, and one-tenth of
the amount of assets in excess of the accrued liabilities of the relief association calculated
under section 424A.092, subdivision 2; 424A.093, subdivisions 2 and 4; or 424A.094,
subdivision 2
, if any.

(b) The maximum service pension which the defined benefit relief association has
authority to provide for in its bylaws for payment to a member retiring after the calculation
date when the minimum age and service requirements specified in subdivision 1 are met
must be determined using the table in paragraph (c) or (d), whichever applies.

(c) For a defined benefit relief association where the governing bylaws provide for a
monthly service pension to a retiring member, the maximum monthly service pension amount
per month for each year of service credited that may be provided for in the bylaws is the
greater of the service pension amount provided for in the bylaws on the date of the calculation
of the average amount of the available financing per active covered firefighter or the
maximum service pension figure corresponding to the average amount of available financing
per active covered firefighter:

Minimum Average Amount of Available
Financing per Firefighter
Maximum Service Pension Amount
Payable per Month for Each Year of
Service
$ ...
$ .25
41
.50
81
1.00
122
1.50
162
2.00
203
2.50
243
3.00
284
3.50
324
4.00
365
4.50
405
5.00
486
6.00
567
7.00
648
8.00
729
9.00
810
10.00
891
11.00
972
12.00
1053
13.00
1134
14.00
1215
15.00
1296
16.00
1377
17.00
1458
18.00
1539
19.00
1620
20.00
1701
21.00
1782
22.00
1823
22.50
1863
23.00
1944
24.00
2025
25.00
2106
26.00
2187
27.00
2268
28.00
2349
29.00
2430
30.00
2511
31.00
2592
32.00
2673
33.00
2754
34.00
2834
35.00
2916
36.00
2997
37.00
3078
38.00
3159
39.00
3240
40.00
3321
41.00
3402
42.00
3483
43.00
3564
44.00
3645
45.00
3726
46.00
3807
47.00
3888
48.00
3969
49.00
4050
50.00
4131
51.00
4212
52.00
4293
53.00
4374
54.00
4455
55.00
4536
56.00
4617
57.00
4698
58.00
4779
59.00
4860
60.00
4941
61.00
5022
62.00
5103
63.00
5184
64.00
5265
65.00
5346
66.00
5427
67.00
5508
68.00
5589
69.00
5670
70.00
5751
71.00
5832
72.00
5913
73.00
5994
74.00
6075
75.00
6156
76.00
6237
77.00
6318
78.00
6399
79.00
6480
80.00
6561
81.00
6642
82.00
6723
83.00
6804
84.00
6885
85.00
6966
86.00
7047
87.00
7128
88.00
7209
89.00
7290
90.00
7371
91.00
7452
92.00
7533
93.00
7614
94.00
7695
95.00
7776
96.00
7857
97.00
7938
98.00
8019
99.00
8100
100.00
any amount in excess of
8100
100.00

(d) For a defined benefit relief association in which the governing bylaws provide for a
lump-sum service pension to a retiring member, the maximum lump-sum service pension
amount for each year of service credited that may be provided for in the bylaws is the greater
of the service pension amount provided for in the bylaws on the date of the calculation of
the average amount of the available financing per active covered firefighter or the maximum
service pension figure corresponding to the average amount of available financing per active
covered firefighter for the applicable specified period:

Minimum Average Amount of Available
Financing per Firefighter
Maximum Lump-Sum Service Pension
Amount Payable for Each Year of Service
$ ...
$ 10
11
20
16
30
23
40
27
50
32
60
43
80
54
100
65
120
77
140
86
160
97
180
108
200
131
240
151
280
173
320
194
360
216
400
239
440
259
480
281
520
302
560
324
600
347
640
367
680
389
720
410
760
432
800
486
900
540
1000
594
1100
648
1200
702
1300
756
1400
810
1500
864
1600
918
1700
972
1800
1026
1900
1080
2000
1134
2100
1188
2200
1242
2300
1296
2400
1350
2500
1404
2600
1458
2700
1512
2800
1566
2900
1620
3000
1672
3100
1726
3200
1753
3250
1780
3300
1820
3375
1834
3400
1888
3500
1942
3600
1996
3700
2023
3750
2050
3800
2104
3900
2158
4000
2212
4100
2265
4200
2319
4300
2373
4400
2427
4500
2481
4600
2535
4700
2589
4800
2643
4900
2697
5000
2751
5100
2805
5200
2859
5300
2913
5400
2967
5500
3021
5600
3075
5700
3129
5800
3183
5900
3237
6000
3291
6100
3345
6200
3399
6300
3453
6400
3507
6500
3561
6600
3615
6700
3669
6800
3723
6900
3777
7000
3831
7100
3885
7200
3939
7300
3993
7400
4047
7500
4101
7600
4155
7700
4209
7800
4263
7900
4317
8000
4371
8100
4425
8200
4479
8300
4533
8400
4587
8500
4641
8600
4695
8700
4749
8800
4803
8900
4857
9000
4911
9100
4965
9200
5019
9300
5073
9400
5127
9500
5181
9600
5235
9700
5289
9800
5343
9900
5397
10,000
5451
10,100
5505
10,200
5559
10,300
5613
10,400
5667
10,500
5721
10,600
5775
10,700
5829
10,800
5883
10,900
5937
11,000
5991
11,100
6045
11,200
6099
11,300
6153
11,400
6207
11,500
6261
11,600
6315
11,700
6369
11,800
6423
11,900
6477
12,000
6531
12,100
6585
12,200
6639
12,300
6693
12,400
6747
12,500
6801
12,600
6855
12,700
6909
12,800
6963
12,900
7017
13,000
7071
13,100
7125
13,200
7179
13,300
7233
13,400
7287
13,500
7341
13,600
7395
13,700
7449
13,800
7503
13,900
7557
14,000
7611
14,100
7665
14,200
7719
14,300
7773
14,400
7827
14,500
7881
14,600
7935
14,700
7989
14,800
8043
14,900
8097
15,000
any amount in excess of
8097
15,000

(e) For a defined benefit relief association in which the governing bylaws provide for a
monthly benefit service pension as an alternative form of service pension payment to a
lump-sum service pension, the maximum service pension amount for each pension payment
type must be determined using the applicable table contained in this subdivision.

(f) If a defined benefit relief association establishes a service pension in compliance
with the applicable maximum contained in paragraph (c) or (d) and the minimum average
amount of available financing per active covered firefighter is subsequently reduced because
of a reduction in fire state aid or because of an increase in the number of active firefighters,
the relief association may continue to provide the prior service pension amount specified
in its bylaws, but may not increase the service pension amount until the minimum average
amount of available financing per firefighter under the table in paragraph (c) or (d), whichever
applies, permits.

(g) No defined benefit relief association is authorized to provide a service pension in an
amount greater than the largest applicable flexible service pension maximum amount even
if the amount of available financing per firefighter is greater than the financing amount
associated with the largest applicable flexible service pension maximum.

(h) The method of calculating service pensions must be applied uniformly for all years
of active service. Credit must be given for all years of active service deleted text beginexceptdeleted text endnew text begin, unless the
bylaws of the relief association provide that service credit is not given
new text end fornew text begin:
new text end

new text begin (1) years of active service in excess ofnew text end caps on service credit deleted text beginif so provided in the bylaws
of the relief association
deleted text endnew text begin; or
new text end

new text begin (2) years of active service earned by a former member who:
new text end

new text begin (i) has ceased duties as a volunteer firefighter with the fire department before becoming
vested under subdivision 2; and
new text end

new text begin (ii) has not resumed active service with the fire department and active membership in
the relief association for a period as defined in the relief association's bylaws, of not less
than five years
new text end.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective January 1, 2022.
new text end

Sec. 8.

Minnesota Statutes 2020, section 424A.05, subdivision 3b, is amended to read:


Subd. 3b.

Authorized administrative expenses from special fund.

(a) Notwithstanding
any provision of law to the contrary, the payment of the following necessary, reasonable,
and direct expenses of maintaining, protecting, and administering the special fund, when
provided for in the bylaws of the association and approved by the board of trustees,
constitutes authorized administrative expenses of a volunteer firefighters relief association
organized under any law of the state or the Bloomington Fire Department Relief Association:

(1) office expenses, including but not limited to rent, utilities, equipment, supplies,
postage, periodical subscriptions, furniture, fixtures, and salaries of administrative personnel;

(2) salaries of the officers of the association or their designees, and salaries of the
members of the board of trustees of the association if the salary amounts are approved by
the governing body of the entity that is responsible for meeting any minimum obligation
under section 424A.092 or 424A.093 or Laws 2013, chapter 111, article 5, sections 31 to
42, and the itemized expenses of relief association officers and board members that are
incurred as a result of fulfilling their responsibilities as administrators of the special fund;

(3) tuition, registration fees, organizational dues, and other authorized expenses of the
officers or members of the board of trustees incurred in attending educational conferences,
seminars, or classes relating to the administration of the relief association;

(4) audit and audit-related services, accounting and accounting-related services, and
actuarial, medical, legal, and investment and performance evaluation expenses;

(5) filing and application fees new text beginnecessary to administer the special fund new text endpayable by the
relief association to federal or other government entities;

(6) reimbursement to the officers and members of the board of trustees or their designees,
for reasonable and necessary expenses actually paid and incurred in the performance of
their duties as officers or members of the board; and

(7) premiums on fiduciary liability insurance and official bonds for the officers, members
of the board of trustees, and employees of the relief association.

(b) All other expenses of the relief association must be paid from the general fund of
the association if one exists. If a relief association has only one fund, that fund is the special
fund for purposes of this subdivision. If a relief association has a special fund and a general
fund, the payment of any expense of the relief association that is directly related to the
purposes for which both funds were established must be apportioned between the two funds
on the basis of the benefits derived by each fund.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective January 1, 2022.
new text end

Sec. 9.

Minnesota Statutes 2020, section 424A.10, subdivision 2, is amended to read:


Subd. 2.

Payment of supplemental benefit.

(a) Upon the payment by a volunteer
firefighters relief association or by the statewide lump-sum volunteer firefighter plan of a
lump-sum distribution to a qualified recipient, the association must pay a supplemental
benefit to the qualified recipient. Notwithstanding any law to the contrary, the relief
association must pay the supplemental benefit out of its special fund and the statewide
lump-sum volunteer firefighter plan must pay the supplemental benefit out of the statewide
lump-sum volunteer firefighter plan. This benefit is an amount equal to ten percent of the
regular lump-sum distribution that is paid on the basis of the recipient's service as a volunteer
firefighter. In no case may the amount of the supplemental benefit exceed $1,000. A
supplemental benefit under this paragraph may not be paid to a survivor of a deceased active
or deferred volunteer firefighter in that capacity.

(b) Upon the payment by a relief association or the retirement plan of a lump-sum
survivor benefit to a survivor of a deceased active volunteer firefighter or of a deceased
deferred volunteer firefighter, the association must pay a supplemental survivor benefit to
the survivor of the deceased active or deferred volunteer firefighter from the special fund
of the relief association and the retirement plan must pay a supplemental survivor benefit
to the survivor of the deceased active or deferred volunteer firefighter from the retirement
fund if chapter 353G so provides. The amount of the supplemental survivor benefit is 20
percent of the survivor benefit, but not to exceed $2,000.

(c) For purposes of this section, the term "regular lump-sum distribution" means the
pretax lump-sum distribution excluding any interest that may have been credited new text beginon a service
pension under a defined benefit relief association
new text endduring a volunteer firefighter's period of
deferral.

(d) An individual may receive a supplemental benefit under paragraph (a) or under
paragraph (b), but not under both paragraphs with respect to one lump-sum volunteer
firefighter benefit.

new text begin (e) If a qualified recipient receives more than one lump-sum distribution, the qualified
recipient is eligible to receive a supplemental benefit or supplemental survivor benefit,
whichever is applicable, with each lump-sum distribution. Each supplemental benefit shall
be calculated under paragraph (a) or (b), as applicable, and shall be subject to a separate
limit.
new text end

new text begin (f) A qualified recipient who elects to receive a lump-sum distribution in installments
under section 424A.016, subdivision 5, or 424A.02, subdivision 8, is eligible to receive one
supplemental benefit calculated on the total lump-sum distribution amount under paragraph
(a) or (b), as applicable.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective retroactively for supplemental benefits
paid in 2018 and thereafter.
new text end