Skip to main content Skip to office menu Skip to footer
Minnesota Legislature

Office of the Revisor of Statutes

HF 2419

2nd Engrossment - 88th Legislature (2013 - 2014) Posted on 03/27/2014 03:17pm

KEY: stricken = removed, old language.
underscored = added, new language.
Line numbers 1.1 1.2 1.3 1.4 1.5
1.6 1.7 1.8 1.9 1.10 1.11 1.12 1.13 1.14 1.15 1.16 1.17 1.18 1.19 1.20 1.21 1.22 1.23 1.24 2.1 2.2 2.3 2.4 2.5 2.6 2.7 2.8 2.9 2.10 2.11 2.12 2.13 2.14 2.15 2.16 2.17 2.18 2.19 2.20 2.21 2.22 2.23 2.24 2.25 2.26 2.27 2.28 2.29 2.30 2.31 2.32 2.33 2.34 2.35 2.36 3.1 3.2
3.3 3.4 3.5 3.6
3.7 3.8

A bill for an act
relating to retirement; requiring the commissioner of management and budget
to report to the legislature on a state-administered retirement savings plan;
appropriating money.

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

Section 1. new text beginREPORT; RETIREMENT SAVINGS PLAN.
new text end

new text begin (a) The commissioner of management and budget must report to the legislature
by January 15, 2015, on the potential for a state-administered retirement savings plan
to serve employees without access to either an automatic enrollment payroll deduction
IRA maintained or offered by their employer, or a multiemployer retirement plan or
qualifying retirement plan or arrangement described in sections 414(f) and 219(g)(5),
respectively, of the Internal Revenue Code of 1986, as amended through April 14, 2011.
The potential state-administered plan would provide for individuals to make contributions
to their own accounts to be pooled and invested by the State Board of Investment, with the
benefit consisting of the balance in each individual's account, and with the state having no
liability for investment earnings and losses, while discouraging employers from dropping
existing retirement plan options.
new text end

new text begin (b) The report must include:
new text end

new text begin (1) estimates of the number of Minnesota workers who could be served by the
potential state-administered plan and the participation rate that would make the plan
self-sustaining;
new text end

new text begin (2) the effect of federal tax laws and the federal Employee Retirement Income
Security Act on a potential state-administered plan and on participating employers and
employees, including coverage and potential gaps in consumer protections;
new text end

new text begin (3) the potential use and availability of investment strategies, private insurance,
underwriting, or reinsurance against loss to limit or eliminate potential state liability
and manage risk to the principal;
new text end

new text begin (4) options for the process by which individuals would enroll in and contribute to
the plan;
new text end

new text begin (5) projected costs of administration, record keeping, and investment management,
including staffing, legal, compliance, licensing, procurement, communications with
employers and employees, oversight, marketing, technology and infrastructure, and the fee
needed to cover these costs as a percentage of the average daily net assets of the potential
state-administered plan, relative to asset size, with estimates of investment-related fees
determined in consultation with the State Board of Investment; and
new text end

new text begin (6) a comparison of a potential state-administered plan to private sector and federal
government retirement savings options with regard to participation rates, contribution
rates, risk-adjusted return expectations, fees, and any other factors determined by
the commissioner, which may include suitability in meeting the investment needs of
participants.
new text end

new text begin (c) Subject to available appropriation, the report may include:
new text end

new text begin (1) estimates of the average amount of savings and other financial resources residents
of Minnesota have upon retirement and those that are recommended for a financially
secure retirement in Minnesota;
new text end

new text begin (2) estimates of the relative progress toward achieving the savings recommended for
a financially secure retirement by gender, race, and ethnicity;
new text end

new text begin (3) barriers to savings and reasons individuals and employers may not be
participating in existing private sector retirement plans;
new text end

new text begin (4) the estimated impact on publicly funded social safety net programs attributable
to insufficient retirement savings, and the aggregate effect of potential state-administered
plan options on publicly funded social safety net programs and the state economy;
new text end

new text begin (5) the effect of federal tax laws and the federal Employee Retirement Income
Security Act on a potential state-administered plan that allows for voluntary employer
contributions, either commingled with or segregated from employee contributions;
new text end

new text begin (6) options for a potential state-administered plan to use group annuities to ensure a
stable stream of retirement income throughout beneficiaries' retirement years;
new text end

new text begin (7) alternative ways and costs for the state to encourage similar outcomes to a
state-administered plan; and
new text end

new text begin (8) other topics that the commissioner determines are relevant to legislative
consideration of possible establishment of a state-administered plan.
new text end

new text begin (d) The commissioner may meet any of the topics in paragraph (c) by reporting the
results of a request for public comment.
new text end

Sec. 2. new text beginAPPROPRIATION.
new text end

new text begin $300,000 is appropriated for the fiscal year ending June 30, 2014, from the general
fund to the commissioner of management and budget for the purposes of section 1. This
appropriation is available until spent.
new text end

Sec. 3. new text beginEFFECTIVE DATE.
new text end

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