Minnesota Legislature
HF 2610
as introduced - 92nd Legislature (2021 - 2022) Posted on 05/11/2021 04:14pm
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A bill for an act
relating to retirement; volunteer firefighter relief associations; requiring special
fund assets to be invested with the State Board of Investment; requiring an
investment portfolio review; revising the investment disclosure requirement for
volunteer firefighter relief associations; amending Minnesota Statutes 2020, sections
356.645; 356.646; 356A.06, subdivision 5; 424A.095.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:
Section 1.
Minnesota Statutes 2020, section 356.645, is amended to read:
356.645 INVESTMENT OF deleted text begin VARIOUSdeleted text end DEFINED CONTRIBUTION deleted text begin PLAN
ASSETSdeleted text end new text begin PLANS AND VOLUNTEER FIREFIGHTER RELIEF ASSOCIATIONSnew text end .
The State Board of Investment shall determine the investments to be made available to
plan participants in plans defined in sections 352.965, 352.98, and 383B.46 and chapters
352D and 353Dnew text begin and to volunteer firefighter relief associations under chapter 424Anew text end .
Investments made available to plan participants new text begin and relief associations new text end must include at least
one or more of the following:
(1) shares in the Minnesota supplemental investment fund established in section 11A.17;
(2) savings accounts in federally insured financial institutions;
(3) life insurance contracts, fixed annuity contracts, and variable annuity contracts from
companies that are subject to regulation by the commissioner of commerce;
(4) investment options from open-end investment companies registered under the federal
Investment Company Act of 1940, United States Code, title 15, sections 80a-1 to 80a-64;
(5) investment options from a firm that is a registered investment adviser under the
Investment Advisers Act of 1940, United States Code, title 15, sections 80b-1 to 80b-21;
and
(6) investment options of a bank as defined in United States Code, title 15, section 80b-2,
subsection (a), paragraph (2), or a bank holding company as defined in the Bank Holding
Company Act of 1956, United States Code, title 12, section 1841, subsection (a), paragraph
(1).
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective January 1, 2023.
new text end
Sec. 2.
Minnesota Statutes 2020, section 356.646, is amended to read:
356.646 PLAN PARTICIPANT INVESTMENT RESPONSIBILITY.
Subdivision 1.
Member investment responsibility.
The state, State Board of Investment
and its executive director and staff, plan administrators and their staff, and participating
public employers are not liable and are not responsible for any investment losses due to
choices made by participantsnew text begin , members, or beneficiaries,new text end or deleted text begin due todeleted text end new text begin in new text end qualified default
investment alternatives.
Subd. 2.
Application.
This section applies to the:
deleted text begin
(1) Minnesota state deferred compensation plan, established under section 352.965;
deleted text end
deleted text begin
(2) health care savings plan, established under section 352.98;
deleted text end
deleted text begin
(3) unclassified employees retirement program, established under chapter 352D;
deleted text end
deleted text begin
(4) public employees defined contribution plan, established under chapter 353D;
deleted text end
new text begin
(1) defined contribution plans described in section 356.645 by reference to the sections
or chapters under which they were established or are administered;
new text end
new text begin
(2) volunteer firefighter relief associations, established under chapter 424A;
new text end
deleted text begin (5)deleted text end new text begin (3) new text end individual retirement account plan, established under chapter 354B;
deleted text begin (6)deleted text end new text begin (4) new text end higher education supplemental retirement plan, established under chapter 354C;
and
deleted text begin (7)deleted text end new text begin (5) new text end Arts Board and Humanities Commission individual retirement account plan,
established under chapter 354D.
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective January 1, 2023.
new text end
Sec. 3.
Minnesota Statutes 2020, section 356A.06, subdivision 5, is amended to read:
Subd. 5.
Investment business recipient disclosure.
new text begin (a) new text end The chief administrative officer
of a covered pension plan, new text begin except a volunteer firefighter relief association under chapter
424A, new text end with respect to investments made by the plan, and the executive director of the State
Board of Investment, with respect to investments of plan assets made by the board, shall
annually disclose in writing the recipients of investment business placed with or investment
commissions allocated among commercial banks, investment bankers, brokerage
organizations, or other investment managers. deleted text begin The
deleted text end
new text begin
(b) An officer of a volunteer firefighter relief association under chapter 424A shall
annually disclose in writing any fees or other compensation directly or indirectly paid to
each qualified financial advisor appointed by the governing board of the relief association
under section 424A.095, paragraph (b).
new text end
new text begin (c) A new text end disclosure document new text begin required under paragraph (a) or (b) new text end must be prepared within
60 days after the close of the fiscal year of the plan new text begin or relief association new text end and must be available
for public inspection during regular office hours at the office of the plannew text begin or relief associationnew text end .
The disclosure document must also be filed with the executive director of the Legislative
Commission on Pensions and Retirement within 90 days after the close of the fiscal yeardeleted text begin
of the plandeleted text end .
new text begin (d)new text end For the State Board of Investment and a first class city teacher retirement fund
association, a disclosure document included as part of a regular annual report of the board
or of the first class city teacher retirement fund association when filed with the executive
director of the Legislative Commission on Pensions and Retirement is considered to have
been filed on a timely basis.
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective January 1, 2023.
new text end
Sec. 4.
Minnesota Statutes 2020, section 424A.095, is amended to read:
424A.095 INVESTMENTS.
(a) new text begin Except as provided in paragraph (b), new text end the deleted text begin special fund assetsdeleted text end new text begin governing board new text end of a
relief association deleted text begin governed by sections 424A.091 to 424A.096deleted text end must deleted text begin be invested in securities
that are authorizeddeleted text end new text begin invest the assets of the relief association's special fund in new text end investments
new text begin made available to relief associations as determined by the State Board of Investment new text end under
section deleted text begin 356A.06, subdivision 6 or 7, whichever appliesdeleted text end new text begin 356.645new text end .
new text begin
(b) The governing board of a relief association, as part of its special fund, may maintain
a federally insured checking account or money market account to hold funds for a period
of not longer than 60 days to make disbursements authorized by section 424A.05, subdivision
3. Such funds may be (1) funds withheld by the governing board from any state aid,
contributions, or other payments made to the relief association that would otherwise have
been required to be transmitted to the State Board of Investment under paragraph (a), or (2)
funds withdrawn from the relief association's investments at the State Board of Investment.
In either case, upon receipt, the governing board must immediately deposit such funds in
the relief association's checking account or money market account.
new text end
deleted text begin (b)deleted text end new text begin (c) new text end The governing board of the new text begin relief new text end association may select and appoint a qualified
deleted text begin private firmdeleted text end new text begin financial advisor new text end to new text begin (1) advise the board in the selection of investments, and
(2) new text end measure management performance and return on investmentdeleted text begin , and the firmdeleted text end new text begin . The advisornew text end
must use the formula or formulas developed by the state board under section 11A.04, clause
(11)new text begin , to measure management performance and return on investmentnew text end .
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective January 1, 2023.
new text end
Sec. 5. new text begin INVESTMENT PORTFOLIO REVIEW.
new text end
new text begin
No later than June 30, 2022, the governing board of a volunteer firefighter relief
association with a special fund that is not already entirely invested with the State Board of
Investment shall review the investment portfolio of the special fund and determine whether
any security in which special fund assets are invested cannot be prudently liquidated and
the proceeds transferred to the State Board of Investment by January 1, 2023. If the governing
board determines that special fund assets are invested in securities that cannot be prudently
liquidated by January 1, 2023, the governing board must prepare a report identifying the
securities and a schedule for liquidation. The governing board must complete the report and
schedule by January 1, 2023, and retain the report and schedule in the office of the volunteer
firefighter relief association for public inspection.
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