HF 2605

as introduced - 81st Legislature (1999 - 2000) Posted on 12/15/2009 12:00am

  1.1                          A bill for an act 
  1.2             relating to retirement; extending certain vendor 
  1.3             contracts; allowing certain participants in the higher 
  1.4             education supplemental retirement plan to purchase 
  1.5             teachers retirement service credit for certain prior 
  1.6             service or leave; increasing maximum contribution 
  1.7             limits in certain supplemental retirement plans; 
  1.8             amending Minnesota Statutes 1998, sections 136F.45, 
  1.9             subdivision 1a; and 354C.165; Minnesota Statutes 1999 
  1.10            Supplement, section 356.24, subdivision 1; proposing 
  1.11            coding for new law in Minnesota Statutes, chapter 354. 
  1.12  BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
  1.13     Section 1.  Minnesota Statutes 1998, section 136F.45, 
  1.14  subdivision 1a, is amended to read: 
  1.15     Subd. 1a.  [SUBSEQUENT VENDOR CONTRACTS.] (a) The board may 
  1.16  limit the number of vendors under subdivision 1. 
  1.17     (b) In addition to any other tax-sheltered annuity program 
  1.18  investment options, the board may offer as an investment option 
  1.19  the Minnesota supplemental investment fund administered by the 
  1.20  state board of investment under section 11A.17. 
  1.21     (c) For the tax-sheltered annuity program vendor contracts 
  1.22  to be executed for the period beginning after July 1, 2000, the 
  1.23  board shall actively solicit participation of and shall include 
  1.24  as vendors lower expense and "no-load" mutual funds or 
  1.25  equivalent investment products as those terms are defined by the 
  1.26  federal securities and exchange commission.  To the extent 
  1.27  possible, in addition to a range of insurance annuity contract 
  1.28  providers and other mutual fund provider arrangements, the board 
  2.1   must assure that no less than five insurance annuity providers 
  2.2   and no less than one nor more than three lower expense and 
  2.3   "no-load" mutual funds or equivalent investment products will be 
  2.4   made available for direct-access by employee participants.  To 
  2.5   the extent that offering a lower expense "no-load" product 
  2.6   increases the total necessary and reasonable expenses of the 
  2.7   program and if the board is unable to negotiate a rebate of fees 
  2.8   from the mutual fund or equivalent investment product providers, 
  2.9   the board may charge the participants utilizing the lower 
  2.10  expense "no-load" mutual fund products a fee to cover those 
  2.11  expenses.  The participant fee may not exceed one percent of the 
  2.12  participant's annual contributions or $20 per participant per 
  2.13  year, whichever is greater.  Any excess fee revenue generated 
  2.14  under this subdivision must be reimbursed to participant 
  2.15  accounts in the manner provided in subdivision 3a. 
  2.16     (d) Notwithstanding paragraph (c), with the agreement of 
  2.17  the parties involved, the board may extend the vendor contracts 
  2.18  in effect immediately prior to July 1, 2000, for up to an 
  2.19  additional two years. 
  2.20     Sec. 2.  [354.539] [USE OF COLLEGE SUPPLEMENTAL RETIREMENT 
  2.21  FUNDS TO PURCHASE SERVICE CREDIT.] 
  2.22     Unless prohibited or penalized under federal law, 
  2.23  participants in the college supplemental retirement plan 
  2.24  authorized by chapter 354C shall be allowed to purchase service 
  2.25  credit authorized by sections 354.53, 354.533, 354.534, 354.535, 
  2.26  354.536, 354.537, and 354.538.  At the request of a member, 
  2.27  determined by the teachers retirement association to be eligible 
  2.28  to purchase service credit, the teachers retirement association 
  2.29  shall notify the Minnesota state college and university board of 
  2.30  the cost of the purchase and request the transfer of funds from 
  2.31  the member's college supplemental retirement account to the 
  2.32  teachers retirement association.  Upon receipt of the necessary 
  2.33  funds, the teachers retirement association shall execute the 
  2.34  requested purchase of service credit. 
  2.35     Sec. 3.  Minnesota Statutes 1998, section 354C.165, is 
  2.36  amended to read: 
  3.1      354C.165 [PROHIBITION ON LOANS OR PRETERMINATION 
  3.2   DISTRIBUTIONS.] 
  3.3      (a) Except as provided in paragraph (c), no participant may 
  3.4   obtain a loan from the plan or obtain any distribution from the 
  3.5   plan at a time before the participant terminates the employment 
  3.6   that gave rise to plan coverage. 
  3.7      (b) No amounts to the credit of the plan are assignable 
  3.8   either in law or in equity, are subject to state estate tax, or 
  3.9   are subject to execution, levy, attachment, garnishment, or 
  3.10  other legal process, except as provided in section 518.58, 
  3.11  518.581, or 518.6111.  
  3.12     (c) Unless prohibited or penalized under federal law, 
  3.13  participants in the supplemental retirement plan may request, 
  3.14  and the board shall execute the transfer of funds accumulated 
  3.15  in, their supplemental accounts to the teachers retirement 
  3.16  association to purchase service credit authorized under sections 
  3.17  354.53, 354.533, 354.534, 354.535, 354.536, 354.537, and 
  3.18  354.538.  The transfer shall be a fund-to-fund transfer, and in 
  3.19  no event shall the participant directly receive any of the funds 
  3.20  while still employed by the board.  In no event shall the board 
  3.21  transfer more than the participant's account balance.  The 
  3.22  board, in cooperation with the teachers retirement association, 
  3.23  shall develop procedures and forms for executing requested 
  3.24  transfers. 
  3.25     Sec. 4.  Minnesota Statutes 1999 Supplement, section 
  3.26  356.24, subdivision 1, is amended to read: 
  3.27     Subdivision 1.  [RESTRICTION; EXCEPTIONS.] It is unlawful 
  3.28  for a school district or other governmental subdivision or state 
  3.29  agency to levy taxes for, or contribute public funds to a 
  3.30  supplemental pension or deferred compensation plan that is 
  3.31  established, maintained, and operated in addition to a primary 
  3.32  pension program for the benefit of the governmental subdivision 
  3.33  employees other than: 
  3.34     (1) to a supplemental pension plan that was established, 
  3.35  maintained, and operated before May 6, 1971; 
  3.36     (2) to a plan that provides solely for group health, 
  4.1   hospital, disability, or death benefits; 
  4.2      (3) to the individual retirement account plan established 
  4.3   by chapter 354B; 
  4.4      (4) to a plan that provides solely for severance pay under 
  4.5   section 465.72 to a retiring or terminating employee; 
  4.6      (5) for employees other than personnel employed by the 
  4.7   state university board or the community college board and 
  4.8   covered by the board of trustees of the Minnesota state colleges 
  4.9   and universities supplemental retirement plan under chapter 
  4.10  354C, if provided for in a personnel policy of the public 
  4.11  employer or in the collective bargaining agreement between the 
  4.12  public employer and the exclusive representative of public 
  4.13  employees in an appropriate unit, in an amount matching employee 
  4.14  contributions on a dollar for dollar basis, but not to exceed an 
  4.15  employer contribution of $2,000 a year per employee; 
  4.16     (i) to the state of Minnesota deferred compensation plan 
  4.17  under section 352.96; or 
  4.18     (ii) in payment of the applicable portion of the premium on 
  4.19  a tax-sheltered annuity contract qualified under section 403(b) 
  4.20  of the Internal Revenue Code, if purchased from a qualified 
  4.21  insurance company, or to a qualified investment entity, as 
  4.22  defined in subdivision 1a, and, in either case, if the employing 
  4.23  unit has complied with any applicable pension plan provisions of 
  4.24  the Internal Revenue Code with respect to the tax-sheltered 
  4.25  annuity program during the preceding calendar year; or 
  4.26     (6) for personnel employed by the state university board or 
  4.27  the community college board and not covered by clause (5), to 
  4.28  the supplemental retirement plan under chapter 354C, if provided 
  4.29  for in a personnel policy or in the collective bargaining 
  4.30  agreement of the public employer with the exclusive 
  4.31  representative of the covered employees in an appropriate unit, 
  4.32  in an amount matching employee contributions on a dollar for 
  4.33  dollar basis, but not to exceed an employer contribution of 
  4.34  $2,000 $2,700 a year for each employee.