1.1 	A bill for an act
1.2 	relating to retirement; benefit and contribution changes for Minnesota statewide 
1.3 	and major local public employee retirement plans; increasing contribution rates; 
1.4 	reducing certain postretirement adjustment rates; modifying investment return 
1.5 	assumptions; extending amortization target dates; reducing deferred annuities 
1.6 	augmentation; requiring a study on postretirement adjustments; making 
1.7 	administrative changes to the Minnesota State Retirement System, Teachers 
1.8 	Retirement Association, Public Employees Retirement Association, and St. Paul 
1.9 	Teachers Retirement Fund Association; clarifying refund repayment procedures; 
1.10 	modifying executive director credentials; clarifying service requirements; revising 
1.11 	appeal procedures; modifying service credit purchase procedures; establishing 
1.12 	new procedures for disability applications due to private disability insurance 
1.13 	requirements; clarifying disability benefit payment provisions; modifying annual 
1.14 	benefit limitations for federal tax code compliance; authorizing use of IRS 
1.15 	correction procedures; clarifying benefit offsets for certain refund payments; 
1.16 	clarifying police and fire plan coverage for certain Hennepin Healthcare System 
1.17 	supervisors; modifying various economic actuarial assumptions; authorizing the 
1.18 	transfer of assets and members from the voluntary statewide volunteer firefighter 
1.19 	retirement plan to a volunteer firefighter relief association; adopting 
1.20 	recommendations of the Volunteer Firefighter Relief Association working group; 
1.21 	increasing the lump-sum service pension maximum and lowering certain vesting 
1.22 	requirements for Eden Prairie Volunteer Firefighters Relief Association; modifying 
1.23 	the Brook Park volunteer firefighters service pension level; permitting alternative 
1.24 	allocation of fire state aid for city of Austin; establishing a fire state aid work 
1.25 	group; modifying various Department of Human Services and Department of 
1.26 	Corrections employment classifications eligible for correctional retirement 
1.27 	coverage; revising augmentation interest rates for certain terminated privatized 
1.28 	employees; adopting definition of the Hometown Heroes Act related to public 
1.29 	safety officer death benefits; allowing service credit purchase and rule of 90 
1.30 	eligibility for certain Minnesota Department of Transportation employees; 
1.31 	authorizing MnSCU employees to elect retroactive and prospective TRA coverage; 
1.32 	authorizing MnSCU employee to transfer past service from IRAP to PERA; 
1.33 	increasing maximum employer contribution to a supplemental laborers pension 
1.34 	fund; authorizing certain additional sources of retirement plan funding; making 
1.35 	technical and conforming changes; authorizing direct state aid to the public 
1.36 	employees police and fire retirement plan and the St. Paul Teachers Retirement 
1.37 	Fund Association; modifying pension adjustment revenue provisions; appropriating 
1.38 	money;amending Minnesota Statutes 2016, sections 3A.02, subdivision 4; 3A.03, 
1.39 	subdivisions 2, 3; 16A.14, subdivision 2a; 126C.10, subdivision 37; 127A.45, 
2.1 	subdivision 12; 352.01, subdivisions 2a, 13a; 352.017, subdivision 2; 352.03, 
2.2 	subdivisions 5, 6; 352.04, subdivisions 2, 3, 8, 9; 352.113, subdivisions 2, 4, 14; 
2.3 	352.116, subdivision 1a; 352.22, subdivisions 2, 3, by adding subdivisions; 352.23; 
2.4 	352.27; 352.91, subdivisions 3f, 3g, by adding a subdivision; 352.92, subdivisions 
2.5 	1, 2, by adding a subdivision; 352.955, subdivision 3; 352B.013, subdivision 2; 
2.6 	352B.02, subdivisions 1a, 1c; 352B.08, by adding a subdivision; 352B.085; 
2.7 	352B.086; 352B.11, subdivision 4; 352D.02, subdivisions 1, 3; 352D.04, 
2.8 	subdivision 2; 352D.05, subdivision 4; 352D.085, subdivision 1; 352D.11, 
2.9 	subdivision 2; 352D.12; 352F.04, subdivisions 1, 2, by adding a subdivision; 
2.10 	353.01, subdivisions 2b, 10, 16, 43, 47; 353.012; 353.0162; 353.03, subdivision 
2.11 	3; 353.27, subdivisions 7a, 12, 12a, 12b; 353.28, subdivision 5; 353.29, subdivisions 
2.12 	4, 7; 353.30, subdivisions 3c, 5; 353.32, subdivisions 1, 4; 353.34, subdivisions 
2.13 	2, 3; 353.35, subdivision 1; 353.37, subdivision 1; 353.64, subdivision 10; 353.65, 
2.14 	subdivisions 2, 3, by adding a subdivision; 353F.02, subdivision 5a; 353F.025, 
2.15 	subdivision 2; 353F.04, subdivision 2; 353F.05; 353F.057; 353F.06; 353F.07; 
2.16 	353G.01, subdivision 9, by adding a subdivision; 353G.02, subdivision 6; 353G.03, 
2.17 	subdivision 3; 353G.08, subdivision 3; 353G.11, subdivision 1; 354.05, subdivision 
2.18 	2, by adding a subdivision; 354.06, subdivisions 2, 2a; 354.095; 354.42, 
2.19 	subdivisions 2, 3; 354.435, subdivision 4; 354.436, subdivision 3; 354.44, 
2.20 	subdivisions 3, 6, 9; 354.45, by adding a subdivision; 354.46, subdivision 6; 354.48, 
2.21 	subdivision 1; 354.49, subdivision 2; 354.50, subdivision 2; 354.51, subdivision 
2.22 	5; 354.512; 354.52, subdivisions 4, 4d; 354.53, subdivision 5; 354.55, subdivision 
2.23 	11; 354.66, subdivision 2; 354.72, subdivisions 1, 2; 354A.011, subdivisions 3a, 
2.24 	29; 354A.093, subdivisions 4, 6; 354A.095; 354A.096; 354A.12, subdivisions 1, 
2.25 	1a, 2a, 3a, 3c, 7; 354A.29, subdivision 7; 354A.31, subdivisions 3, 7; 354A.34; 
2.26 	354A.35, subdivision 2; 354A.37, subdivisions 2, 3; 354A.38; 356.195, subdivision 
2.27 	2; 356.215, subdivisions 9, 11; 356.24, subdivision 1; 356.30, subdivision 1; 
2.28 	356.32, subdivision 2; 356.415, subdivisions 1, 1a, 1b, 1c, 1d, 1e, 1f, by adding a 
2.29 	subdivision; 356.44; 356.47, subdivisions 1, 3; 356.50, subdivision 2; 356.551, 
2.30 	subdivision 2; 356.635, subdivision 10, by adding subdivisions; 356.96, 
2.31 	subdivisions 1, 2, 3, 4, 5, 6, 7, 8, 9, 10, 11, 12, 13; 356A.06, subdivision 7; 423A.02, 
2.32 	subdivisions 3, 5; 423A.022, subdivision 5; 424A.001, subdivisions 2, 3, 10, by 
2.33 	adding a subdivision; 424A.002, subdivision 1; 424A.01, subdivisions 1, 5, 6, by 
2.34 	adding subdivisions; 424A.015, subdivision 1, by adding a subdivision; 424A.016, 
2.35 	subdivision 2; 424A.02, subdivisions 1, 3a, 7; 424A.04, subdivision 1; 424A.07; 
2.36 	424A.091, subdivision 3; 424A.094, subdivision 3; 424A.10, subdivision 1; 
2.37 	424B.20, subdivision 4; 490.121, subdivisions 4, 25, 26; 490.1211; 490.123, by 
2.38 	adding a subdivision; 490.124, subdivision 12; Minnesota Statutes 2017 
2.39 	Supplement, sections 353.27, subdivision 3c; 356.215, subdivision 8; proposing 
2.40 	coding for new law in Minnesota Statutes, chapters 353F; 353G; 356; 424A; 
2.41 	repealing Minnesota Statutes 2016, sections 3A.12; 352.04, subdivision 11; 
2.42 	352.045; 352.72; 352B.30; 353.0161; 353.27, subdivision 3b; 353.34, subdivision 
2.43 	6; 353.71; 354.42, subdivisions 4a, 4b, 4c, 4d; 354.60; 354A.12, subdivision 2c; 
2.44 	354A.29, subdivisions 8, 9; 354A.39; 356.611, subdivisions 3, 3a, 4, 5; 356.96, 
2.45 	subdivisions 14, 15; 424A.02, subdivision 13.
2.46 	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

2.47 	ARTICLE 1
2.48 	MINNESOTA STATE RETIREMENT SYSTEM
2.49 	BENEFIT AND CONTRIBUTION CHANGES

2.50 	Section 1. Minnesota Statutes 2016, section 3A.02, subdivision 4, is amended to read:
2.51 		Subd. 4.Deferred annuities augmentation. (a) The deferred retirement allowance of 
2.52 	any former legislator must be augmented as provided herein.
3.1 	(b) The required reserves applicable to the deferred retirement allowance, determined 
3.2 	as of the date the benefit begins to accrue using an appropriate mortality table and an interest 
3.3 	assumption of six percent, must be augmented from the first of the month following the 
3.4 	termination of active service, or July 1, 1973, whichever is later, to the first day of the month 
3.5 	in which the allowance begins to accrue effective date of retirement, at the following annually 
3.6 	compounded rate or rates, compounded annually:
3.7 	(1) five percent until January 1, 1981;
3.8 	(2) three percent from January 1, 1981, or from the first day of the month following the 
3.9 	termination of active service, whichever is later, until January 1 of the year in which the 
3.10 	former legislator attains age 55 or until January 1, 2012, whichever is earlier;
3.11 	(3) five percent from the period end date under clause (2) until the effective date of 
3.12 	retirement or until January 1, 2012, whichever is earlier; and
3.13 	(4) two percent after December 31, 2011. from January 1, 2012, until December 31, 
3.14 	2018; and
3.15 	(5) after December 31, 2018, the deferred annuity must not be augmented.

3.16 	EFFECTIVE DATE. This section is effective July 1, 2018.

3.17 	Sec. 2. Minnesota Statutes 2016, section 352.116, subdivision 1a, is amended to read:
3.18 		Subd. 1a.Actuarial reduction for early retirement. (a) This subdivision applies to a 
3.19 	person who has become at least 55 years old and first became a covered employee after 
3.20 	June 30, 1989, and to any other covered employee who has become at least 55 years old 
3.21 	and whose annuity is higher when calculated under section 352.115, subdivision 3, paragraph 
3.22 	(b), in conjunction with this subdivision than when calculated under section 352.115, 
3.23 	subdivision 3, paragraph (a), in conjunction with subdivision 1. A covered employee who 
3.24 	retires before the normal retirement age shall be paid the normal retirement annuity provided 
3.25 	in section 352.115, subdivisions 2 and 3, paragraph (b), reduced so thatas described in 
3.26 	paragraph (b) or (c), as applicable.
3.27 	(b) For covered employees who retire on or after July 1, 2019, the reduced annuity is 
3.28 	the actuarial equivalent of the annuity that would be payable to the employee if the employee 
3.29 	deferred receipt of the annuity until normal retirement age and the annuity amount were 
3.30 	augmented at anthe applicable annual rate of three percent, compounded annually, from 
3.31 	the day the annuity begins to accrue until the normal retirement age. The applicable annual 
3.32 	rate is the rate in effect on the employee's effective date of retirement and shall be considered 
4.1 	as fixed for the employee for the period until the employee reaches normal retirement age. 
4.2 	The applicable annual rates are the following:
4.3 	(1) until June 30, 2019, three percent if the employee became an employee before July 
4.4 	1, 2006, and 2.5 percent if the employee became an employee after June 30, 2006;
4.5 	(2) beginning July 1, 2019, through June 30, 2024, a rate that changes each month, on 
4.6 	the first day of the month, starting with the rate in clause (1), as applicable to the employee, 
4.7 	and reducing the rate to zero in equal monthly increments over the five-year period; and
4.8 	(3) after June 30, 2024, zero percent.
4.9 	After June 30, 2024, actuarial equivalent, for the purpose of determining the reduced 
4.10 	annuity commencing before normal retirement age under this clause, shall not take into 
4.11 	account any augmentation.
4.12 	(c) For covered employees who retire before July 1, 2019, the reduced annuity is the 
4.13 	actuarial equivalent of the annuity that would be payable to the employee if the employee 
4.14 	deferred receipt of the annuity until normal retirement age and the annuity amount were 
4.15 	augmented at an annual rate of three percent, compounded annually, from the day the annuity 
4.16 	begins to accrue until normal retirement age if the employee became an employee before 
4.17 	July 1, 2006, and at an annual rate of 2.5 percent, compounded annually, from the day the 
4.18 	annuity begins to accrue until the normal retirement age if the employee initially becomes
4.19 	became an employee after June 30, 2006.

4.20 	EFFECTIVE DATE. This section is effective July 1, 2018.

4.21 	Sec. 3. Minnesota Statutes 2016, section 352.22, subdivision 2, is amended to read:
4.22 		Subd. 2.Amount of refund. Except as provided in subdivision 3, the refund payable 
4.23 	to a person who ceased to be a state employee by reason of a termination of state service is 
4.24 	an amount equal to employee accumulated contributions plus interest until the date on which 
4.25 	the refund is paid, at the rate offollowing rates for the applicable period:
4.26 	(1) six percent per year compounded daily from the date that the contribution was made 
4.27 	until June 30, 2011, or until the date on which the refund is paid, whichever is earlier, and 
4.28 	at the rate of;
4.29 	(2) four percent per year compounded daily from the date that the contribution was made 
4.30 	or from July 1, 2011, whichever is later, until the date on which the refund is paid.until 
4.31 	June 30, 2018; and
5.1 	(3) three percent per year compounded daily from the date that the contribution was 
5.2 	made or July 1, 2018, whichever is later.
5.3 	Included with the refund is any interest paid as part of repayment of a past refund, plus 
5.4 	interest thereon from the date of repayment.

5.5 	EFFECTIVE DATE. This section is effective July 1, 2018.

5.6 	Sec. 4. Minnesota Statutes 2016, section 352.22, is amended by adding a subdivision to 
5.7 	read:
5.8 		Subd. 2b.Refund repayment. Any person who has received a refund from the state 
5.9 	employees retirement plan, and who is a member of any of the retirement plans specified 
5.10 	in section 356.311, paragraph (b), may repay the refund with interest to the state employees 
5.11 	retirement plan. If a refund is repaid to the plan and more than one refund has been received 
5.12 	from the plan, all refunds must be repaid. Repayment must be made as provided in section 
5.13 	352.23, and under terms and conditions consistent with that section as agreed upon with 
5.14 	the director.

5.15 	EFFECTIVE DATE. This section is effective July 1, 2018.

5.16 	Sec. 5. Minnesota Statutes 2016, section 352.22, subdivision 3, is amended to read:
5.17 		Subd. 3.Deferred annuity. (a) An employee who has at least three years of allowable 
5.18 	service if employed before July 1, 2010, or who has at least five years of allowable service 
5.19 	if employed after June 30, 2010, when termination occurs may elect to leave the accumulated 
5.20 	contributions in the fund and thereby be entitled to a deferred retirement annuity. The annuity 
5.21 	must be computed under the law in effect when state service terminated, on the basis of the 
5.22 	allowable service credited to the person before the termination of service.
5.23 	(b) An employee on layoff or on leave of absence without pay, except a leave of absence 
5.24 	for health reasons, and who does not return to state service must have an annuity, deferred 
5.25 	annuity, or other benefit to which the employee may become entitled computed under the 
5.26 	law in effect on the employee's last working day.
5.27 	(c) No application for a deferred annuity may be made more than 60 days before the 
5.28 	time the former employee reaches the required age for entitlement to the payment of the 
5.29 	annuity. The deferred annuity begins to accrue no earlier than 60 days before the date the 
5.30 	application is filed in the office of the system, but not (1) before the date on which the 
5.31 	employee reaches the required age for entitlement to the annuity nor (2) before the day 
6.1 	following the termination of state service in a position which is not covered by the retirement 
6.2 	system.
6.3 	(d) Application for the accumulated contributions left on deposit with the fund may be 
6.4 	made at any time following the date of the termination of service.
6.5 	(e) Deferred annuities must be augmented as provided in section 352.72, subdivision 2
6.6 	subdivision 3a.

6.7 	EFFECTIVE DATE. This section is effective July 1, 2018.

6.8 	Sec. 6. Minnesota Statutes 2016, section 352.22, is amended by adding a subdivision to 
6.9 	read:
6.10 		Subd. 3a.Computation of deferred annuity. (a) The deferred annuity of any former 
6.11 	state employee must be augmented from the first day of the month following termination 
6.12 	of active service or July 1, 1971, whichever is later, to the effective date of retirement.
6.13 	(b) For a person who became a state employee before July 1, 2006, the annuity must be 
6.14 	augmented at the following rate or rates, compounded annually:
6.15 	(1) five percent until January 1, 1981;
6.16 	(2) three percent thereafter until January 1 of the year following the year in which the 
6.17 	former employee attains age 55 or January 1, 2012, whichever is earlier;
6.18 	(3) five percent from the January 1 next following the attainment of age 55 until 
6.19 	December 31, 2011;
6.20 	(4) two percent from January 1, 2012, until December 31, 2018; and
6.21 	(5) after December 31, 2018, the deferred annuity must not be augmented.
6.22 	(c) For a person who became a state employee after June 30, 2006, the annuity must be 
6.23 	augmented at the following rate or rates, compounded annually:
6.24 	(1) 2.5 percent until December 31, 2011;
6.25 	(2) two percent from January 1, 2012, until December 31, 2018; and
6.26 	(3) after December 31, 2017, the deferred annuity must not be augmented.
6.27 	(d) The retirement annuity or disability benefit of, or the survivor benefit payable on 
6.28 	behalf of, a former state employee who terminated service before July 1, 1997, which is not 
6.29 	first payable until after June 30, 1997, must be increased on an actuarial equivalent basis 
6.30 	to reflect the change in the postretirement interest rate actuarial assumption under section 
7.1 	356.215, subdivision 8, from five percent to six percent under a calculation procedure and 
7.2 	the tables adopted by the board and approved by the actuary retained under section 356.214.

7.3 	EFFECTIVE DATE. This section is effective July 1, 2018.

7.4 	Sec. 7. Minnesota Statutes 2016, section 352B.08, is amended by adding a subdivision to 
7.5 	read:
7.6 		Subd. 2b.Computation of deferred annuity. (a) The deferred annuity of any former 
7.7 	member must be augmented from the first day of the month following the termination of 
7.8 	active service, or July 1, 1971, whichever is later, to the effective date of retirement.
7.9 	(b) For a person who became an employee before July 1, 2006, the annuity must be 
7.10 	augmented at the following rate or rates, compounded annually:
7.11 	(1) five percent until January 1, 1981;
7.12 	(2) three percent from January 1, 1981, until December 31, 2011;
7.13 	(3) two percent from January 1, 2012, until December 31, 2018; and
7.14 	(4) after December 31, 2018, the deferred annuity must not be augmented.
7.15 	(c) For a person who became an employee after June 30, 2006, the annuity must be 
7.16 	augmented at the following rate or rates, compounded annually:
7.17 	(1) 2.5 percent until December 31, 2011;
7.18 	(2) two percent from January 1, 2012, until December 31, 2018; and
7.19 	(3) after December 31, 2018, the deferred annuity must not be augmented.
7.20 	(d) The mortality table and interest assumption used to compute the annuity must be 
7.21 	those in effect when the member files application for annuity.

7.22 	EFFECTIVE DATE. This section is effective July 1, 2018.

7.23 	Sec. 8. Minnesota Statutes 2016, section 352D.085, subdivision 1, is amended to read:
7.24 		Subdivision 1.Combined service. Except as provided in section 356.30, 356.302, or 
7.25 	356.303, service under the unclassified program forduring which the employee has been 
7.26 	credited with employee sharescontributed to the program under section 352D.04, subdivision 
7.27 	2, may be used for the limited purpose of qualifying for benefits under sections 352.115, 
7.28 	352.72, subdivision 1,352.113, 354.44, 354.45, 354.48, and 354.60 356.311. The service 
7.29 	also may not be used to qualify for a disability benefit under section 352.113 or 354.48 if 
7.30 	a participant was under the unclassified program at the time of the disability. Also, the years 
8.1 	of service and salary paid while the participant was in the unclassified program may not be 
8.2 	used in determining the amount of benefits.

8.3 	EFFECTIVE DATE. This section is effective July 1, 2018.

8.4 	Sec. 9. Minnesota Statutes 2016, section 490.121, subdivision 25, is amended to read:
8.5 		Subd. 25.Tier I. "Tier I" is the benefit program of the retirement plan with a membership 
8.6 	specified by section 490.1221, paragraph (b), and governed by sections 356.415, subdivisions 
8.7 	1 andsubdivision 1f; and 490.121 to 490.133, except as modified in sections 490.121, 
8.8 	subdivision 21f, paragraph (b); 490.1222; 490.123, subdivision 1a, paragraph (b); and 
8.9 	490.124, subdivision 1, paragraphs (c) and (d).

8.10 	EFFECTIVE DATE. This section is effective July 1, 2018.

8.11 	Sec. 10. Minnesota Statutes 2016, section 490.121, subdivision 26, is amended to read:
8.12 		Subd. 26.Tier II. "Tier II" is the benefit program of the retirement plan with a 
8.13 	membership specified by section 490.1221, paragraph (c), and governed by sections 356.415, 
8.14 	subdivisions 1 andsubdivision 1f; 490.121 to 490.133, as modified in section 490.121, 
8.15 	subdivision 21f, paragraph (b); 490.1222; 490.123, subdivision 1a, paragraph (b); and 
8.16 	490.124, subdivision 1, paragraphs (c) and (d).

8.17 	EFFECTIVE DATE. This section is effective July 1, 2018.

8.18 	Sec. 11.  REPEALER.
 8.19 	Minnesota Statutes 2016, sections 3A.12; 352.045; 352.72; and 352B.30, are repealed.

8.20 	EFFECTIVE DATE. This section is effective July 1, 2018.

8.21 	ARTICLE 2
8.22 	PUBLIC EMPLOYEES RETIREMENT ASSOCIATION
8.23 	BENEFIT AND CONTRIBUTION CHANGES

8.24 	Section 1. Minnesota Statutes 2016, section 353.30, subdivision 5, is amended to read:
8.25 		Subd. 5.Actuarial reduction for early retirement. (a) This subdivision applies to a 
8.26 	member who has become at least 55 years old and first became a public employee after 
8.27 	June 30, 1989, and to any other member who has become at least 55 years old and whose 
8.28 	annuity is higher when calculated under section 353.29, subdivision 3, paragraph (b), in 
8.29 	conjunction with this subdivision than when calculated under section 353.29, subdivision 
8.30 	3, paragraph (a), in conjunction with subdivision 1, 1a, 1b, or 1c. An employee who retires 
9.1 	before normal retirement age shall be paid the retirement annuity provided in section 353.29, 
9.2 	subdivision 3, paragraph (b), reduced so thatas described in paragraph (b) or (c), as 
9.3 	applicable.
9.4 	(b) For members who begin to receive an annuity on or after July 1, 2019, the reduced 
9.5 	annuity is the actuarial equivalent of the annuity that would be payable to the employee if 
9.6 	the employee deferred receipt of the annuity until normal retirement age and the annuity 
9.7 	amount were augmented at anthe applicable annual rate of three percent, compounded 
9.8 	annually, from the day the annuity begins to accruestarting date until the normal retirement 
9.9 	age. The applicable annual rate is the rate in effect on the employee's effective date of 
9.10 	retirement and shall be considered as fixed for the employee for the period until the employee 
9.11 	reaches normal retirement age. The applicable annual rates are the following:
9.12 	(1) until June 30, 2019, three percent if the employee became an employee before July 
9.13 	1, 2006, and 2.5 percent if the employee became an employee after June 30, 2006;
9.14 	(2) beginning July 1, 2019, through June 30, 2024, a rate that changes each month, on 
9.15 	the first day of the month, starting with the rate in clause (1), as applicable to the employee, 
9.16 	and reducing the rate to zero in equal monthly increments over the five-year period; and
9.17 	(3) after June 30, 2024, zero percent.
9.18 	After June 30, 2024, actuarial equivalent, for the purpose of determining the reduced 
9.19 	annuity commencing before normal retirement age under this paragraph, shall not take into 
9.20 	account any augmentation.
9.21 	(c) For members who begin to receive an annuity before July 1, 2019, the reduced annuity 
9.22 	is the actuarial equivalent of the annuity that would be payable to the employee if the 
9.23 	employee deferred receipt of the annuity until normal retirement age and the annuity amount 
9.24 	were augmented at an annual rate of three percent, compounded annually, from the annuity 
9.25 	starting date until normal retirement age if the employee became an employee before July 
9.26 	1, 2006, and at 2.5 percent, compounded annually, from the day the annuity begins to accrue
9.27 	starting date until the normal retirement age if the employee initially becomesbecame an 
9.28 	employee after June 30, 2006.

9.29 	EFFECTIVE DATE. This section is effective for annuities with an annuity starting 
9.30 	date that is on or after July 1, 2019, notwithstanding the member's date of termination of 
9.31 	public service.

10.1 	Sec. 2. Minnesota Statutes 2016, section 353.34, subdivision 2, is amended to read:
10.2 		Subd. 2.Refund with interest. (a) Except as provided in subdivision 1, any person who 
10.3 	ceases to be a public employee member is entitled to receive a refund in an amount equal 
10.4 	to accumulated deductions with annual compound interest to the first day of the month in 
10.5 	which the refund is processed.
10.6 	(b) Annual compound interest rates on a refund under paragraph (a) shall be as follows:
10.7 	(1) for a person who ceases to be a public employee before July 1, 2011, the refund 
10.8 	interest is at the rate of six percent to June 30, 2011,;
10.9 	(2) four percent after June 30, 2011, to June 30, 2018; and at the rate of four
10.10 	(3) three percent after June 30, 2011.2018.
10.11 	for a person who ceases to be a public employee after July 1, 2011, the refund interest 
10.12 	is at the rate of four percent.
10.13 	(c) If a person repays a refund and subsequently applies for another refund, the repayment 
10.14 	amount, including interest, is added to the fiscal year balance in which the repayment was 
10.15 	made.
10.16 	(d) If the refund payable to a member is based on employee deductions that are 
10.17 	determined to be invalid under section 353.27, subdivision 7, the interest payable on the 
10.18 	invalid employee deductions is four percent.

10.19 	EFFECTIVE DATE. This section is effective July 1, 2018.

10.20 	Sec. 3. Minnesota Statutes 2016, section 353.34, subdivision 3, is amended to read:
10.21 		Subd. 3.Deferred annuity; eligibility; computation. (a) A member who is vested 
10.22 	under section 353.01, subdivision 47, when termination of public service or termination of 
10.23 	membership occurs has the option of leaving the accumulated deductions in the fund and 
10.24 	being entitled to a deferred retirement annuity commencing at normal retirement age or to 
10.25 	a deferred early retirement annuity under section 353.30, subdivision 1a, 1b, 1c, or 5.
10.26 	(b) The deferred annuity must be computed under section 353.29, subdivision 3, on the 
10.27 	basis of the law in effect on the date of termination of public service or termination of 
10.28 	membership, whichever is earlier, and must be augmented as provided in section 353.71, 
10.29 	subdivision 2 paragraph (c).
11.1 	(c) The deferred annuity of any former member must be augmented from the first day 
11.2 	of the month following the termination of active service, or July 1, 1971, whichever is later, 
11.3 	to the effective date of retirement.
11.4 	(d) For a person who became a public employee before July 1, 2006, and who has a 
11.5 	termination of public service before January 1, 2012, the deferred annuity must be augmented 
11.6 	at the following rate or rates, compounded annually:
11.7 	(1) five percent until January 1, 1981;
11.8 	(2) three percent from January 1, 1981, until January 1 of the year following the year in 
11.9 	which the former member attains age 55 or December 31, 2011, whichever is earlier;
11.10 	(3) five percent from January 1 of the year following the year in which the former member 
11.11 	attains age 55, or December 31, 2011, whichever is earlier;
11.12 	(4) one percent from January 1, 2012, until December 31, 2018; and
11.13 	(5) after December 31, 2018, the deferred annuity must not be augmented.
11.14 	(e) For a person who became a public employee after June 30, 2006, and who has a 
11.15 	termination of public service before January 1, 2012, the deferred annuity must be augmented 
11.16 	at the following rate or rates, compounded annually:
11.17 	(1) 2.5 percent until December 31, 2011;
11.18 	(2) one percent from January 1, 2012, until December 31, 2018; and
11.19 	(3) after December 31, 2018, the deferred annuity must not be augmented.
11.20 	(f) For a person who has a termination of public service after December 31, 2011, the 
11.21 	deferred annuity must not be augmented.
11.22 	(g) The retirement annuity or disability benefit of, or the survivor benefit payable on 
11.23 	behalf of, a former member who terminated service before July 1, 1997, or the survivor 
11.24 	benefit payable on behalf of a basic or police and fire member who was receiving disability 
11.25 	benefits before July 1, 1997, which is first payable after June 30, 1997, must be increased 
11.26 	on an actuarial equivalent basis to reflect the change in the postretirement interest rate 
11.27 	actuarial assumption under section 356.215, subdivision 8, from five percent to six percent 
11.28 	under a calculation procedure and tables adopted by the board and approved by the actuary 
11.29 	retained under section 356.214.
11.30 	(c)(h) A former member qualified to apply for a deferred retirement annuity may revoke 
11.31 	this option at any time before the commencement of deferred annuity payments by making 
11.32 	application for a refund. The person is entitled to a refund of accumulated member 
12.1 	contributions within 30 days following date of receipt of the application by the executive 
12.2 	director.

12.3 	EFFECTIVE DATE. This section is effective July 1, 2018.

12.4 	Sec. 4. REPEALER.
 12.5 	Minnesota Statutes 2016, sections 353.27, subdivision 3b; and 353.71, are repealed.

12.6 	EFFECTIVE DATE. This section is effective July 1, 2018.

12.7 	ARTICLE 3
12.8 	TEACHERS RETIREMENT ASSOCIATION
12.9 	BENEFIT AND CONTRIBUTION CHANGES

12.10 	Section 1. Minnesota Statutes 2016, section 354.44, subdivision 6, is amended to read:
12.11 		Subd. 6.Computation of formula program retirement annuity. (a) The formula 
12.12 	retirement annuity must be computed in accordance with the applicable provisions of the 
12.13 	formulas stated in paragraph (b) or (d) on the basis of each member's average salary under 
12.14 	section 354.05, subdivision 13a, for the period of the member's formula service credit.
12.15 	(b) This paragraph, in conjunction with paragraph (c), applies to a person who first 
12.16 	became a member of the association or a member of a pension fund listed in section 356.30, 
12.17 	subdivision 3, before July 1, 1989, unless paragraph (d), in conjunction with paragraph (e), 
12.18 	produces a higher annuity amount, in which case paragraph (d) applies. The average salary 
12.19 	as defined in section 354.05, subdivision 13a, multiplied by the following percentages per 
12.20 	year of formula service credit shall determine the amount of the annuity to which the member 
12.21 	qualifying therefor is entitled for service rendered before July 1, 2006:

12.22		Period
		Coordinated Member
		Basic Member
	
12.23
12.24		Each year of service 
during first ten
		1.2 percent  per year
		2.2 percent  per year
	
12.25
12.26		Each year of service 
thereafter
		1.7 percent  per year
		2.7 percent  per year
	
12.27 	For service rendered on or after July 1, 2006, by a member other than a member who 
12.28 	was a member of the former Duluth Teachers Retirement Fund Association between January 
12.29 	1, 2006, and June 30, 2015, and for service rendered on or after July 1, 2013, by a member 
12.30 	who was a member of the former Duluth Teachers Retirement Fund Association between 
12.31 	January 1, 2013, and June 30, 2015, the average salary as defined in section 354.05, 
12.32 	subdivision 13a, multiplied by the following percentages per year of service credit, determines 
12.33 	the amount the annuity to which the member qualifying therefor is entitled:

13.1		Period
		Coordinated Member
		Basic Member
	
13.2
13.3		Each year of service 
during first ten
		1.4 percent  per year
		2.2 percent  per year
	
13.4
13.5		Each year of service after 
ten years of service
		1.9 percent  per year
		2.7 percent  per year
	
13.6 	(c)(i)(1) This paragraph applies only to a person who first became a member of the 
13.7 	association or a member of a pension fund listed in section 356.30, subdivision 3, before 
13.8 	July 1, 1989, and whose annuity is higher when calculated under paragraph (b), in conjunction 
13.9 	with this paragraph than when calculated under paragraph (d), in conjunction with paragraph 
13.10 	(e).
13.11 	(ii) (2) Where any member retires prior to normal retirement age under a formula annuity, 
13.12 	the member shall be paid a retirement annuity in an amount equal to the normal annuity 
13.13 	provided in paragraph (b) reduced by one-quarter of one percent for each month that the 
13.14 	member is under normal retirement age at the time of retirement except that for any member 
13.15 	who has 30 or more years of allowable service credit, the reduction shall be applied only 
13.16 	for each month that the member is under age 62.
13.17 	(iii) (3) Any member whose attained age plus credited allowable service totals 90 years 
13.18 	is entitled, upon application, to a retirement annuity in an amount equal to the normal annuity 
13.19 	provided in paragraph (b), without any reduction by reason of early retirement.
13.20 	(d) This paragraph applies to a member who has become at least 55 years old and first 
13.21 	became a member of the association after June 30, 1989, and to any other member who has 
13.22 	become at least 55 years old and whose annuity amount when calculated under this paragraph 
13.23 	and in conjunction with paragraph (e), is higher than it is when calculated under paragraph 
13.24 	(b), in conjunction with paragraph (c).
13.25 	(1) For a basic member, the average salary, as defined in section 354.05, subdivision 
13.26 	13a, multiplied by 2.7 percent for each year of service for a basic member determines the 
13.27 	amount of the retirement annuity to which the basic member is entitled. The annuity of a 
13.28 	basic member who was a member of the former Minneapolis Teachers Retirement Fund 
13.29 	Association as of June 30, 2006, must be determined according to the annuity formula under 
13.30 	the articles of incorporation of the former Minneapolis Teachers Retirement Fund Association 
13.31 	in effect as of that date.
13.32 	(2) For a coordinated member, the average salary, as defined in section 354.05, 
13.33 	subdivision 13a, multiplied by 1.7 percent for each year of service rendered before July 1, 
13.34 	2006, and by 1.9 percent for each year of service rendered on or after July 1, 2006, for a 
13.35 	member other than a member who was a member of the former Duluth Teachers Retirement 
14.1 	Fund Association between January 1, 2006, and June 30, 2015, and by 1.9 percent for each 
14.2 	year of service rendered on or after July 1, 2013, for a member of the former Duluth Teachers 
14.3 	Retirement Fund Association between January 1, 2013, and June 30, 2015, determines the 
14.4 	amount of the retirement annuity to which the coordinated member is entitled.
14.5 	(e) This paragraph applies to a personmember who has become at least 55 years old 
14.6 	and first becomes a member of the association after June 30, 1989, and to any other member 
14.7 	who has become at least 55 years old and whose annuity is higher when calculated under 
14.8 	paragraph (d) in conjunction with this paragraph than when calculated under paragraph (b), 
14.9 	in conjunction with paragraph (c). An employee who retires under the formula annuity 
14.10 	before the normal retirement age shall be paid the normal annuity provided in paragraph 
14.11 	(d) reduced so that the reduced annuity is the actuarial equivalent of the annuity that would 
14.12 	be payable to the employee if the employee deferred receipt of the annuity and the annuity 
14.13 	amount were augmented at an annual rate of three percent compounded annually from the 
14.14 	day the annuity begins to accrue until the normal retirement age if the employee became 
14.15 	an employee before July 1, 2006, and at 2.5 percent compounded annually if the employee 
14.16 	becomes an employee after June 30, 2006. Except in regards to section 354.46, this paragraph 
14.17 	remains in effect until June 30, 2015.
14.18 	(f) AfterUntil June 30, 2020 2019, this paragraph applies to a personmember who has 
14.19 	become at least 55 years old and first becomes a member of the association after June 30, 
14.20 	1989, and to any other member who has become at least 55 years old and whose annuity is 
14.21 	higher when calculated under paragraph (d) in conjunction with this paragraph than when 
14.22 	calculated under paragraph (b) in conjunction with paragraph (c). An employee who retires 
14.23 	under the formula annuity before the normal retirement age is entitled to receive the normal 
14.24 	annuity provided in paragraph (d), reduced as described in clause (1) or (2), as applicable.
14.25 	(1) For a personmember who is at least age 62 or older and has at least 30 years of 
14.26 	service, the annuity mustshall be reduced by an early reduction factor of six percent per
14.27 	for each year of the annuitythat the member's age of retirement precedes normal retirement 
14.28 	age. The resulting reduced annuity shall be further adjusted to take into account the increase 
14.29 	in the monthly amount that would be payable to the employee if the employeehave occurred 
14.30 	had the member retired early and deferred receipt of the annuity until normal retirement 
14.31 	age and the annuity amount werewas augmented at an annual rate of three percent 
14.32 	compounded annually from the day the annuity begins to accrue until the normal retirement 
14.33 	age if the employee became an employee before July 1, 2006, andduring the deferral period 
14.34 	at 2.5 percent compounded annually, if the employee became an employeemember 
15.1 	commenced employment after June 30, 2006, or at three percent, if the member commenced 
15.2 	employment before July 1, 2006, compounded annually.
15.3 	(2) For a personmember who ishas not at leastattained age 62 or older and does not 
15.4 	have at leastor has fewer than 30 years of service, the annuity wouldshall be reduced for 
15.5 	each year that the member's age of retirement precedes the normal retirement age by anthe 
15.6 	following early reduction factor offactors:
15.7 	(i) for the period during which the member is age 55 through age 59, the factor is four 
15.8 	percent per year for ages 55 through 59; and
15.9 	(ii) for the period during which the member is age 60 but not yet normal retirement age, 
15.10 	the factor is seven percent per year of the annuity that would be payable to the employee if 
15.11 	the employee.
15.12 	The resulting reduced annuity shall be further adjusted to take into account the increase 
15.13 	in the monthly amount that would have occurred had the member retired early and deferred 
15.14 	receipt of the annuity until normal retirement age and the annuity amount werewas 
15.15 	augmented at an annual rate of three percent compounded annually from the day the annuity 
15.16 	begins to accrue until the normal retirement age if the employee became an employee before 
15.17 	July 1, 2006, andduring the deferral period at 2.5 percent compounded annually, if the 
15.18 	employee became an employeemember commenced employment after June 30, 2006, or 
15.19 	at three percent, if the member commenced employment before July 1, 2006, compounded 
15.20 	annually.
15.21 	(g) For members who retire on or after July 1, 2019, this paragraph applies to a person 
15.22 	who has become at least 55 years old and first becomes a member of the association after 
15.23 	June 30, 1989, and to any other member who has become at least 55 years old and whose 
15.24 	annuity is higher when calculated under paragraph (d) in conjunction with this paragraph 
15.25 	than when calculated under paragraph (b) in conjunction with paragraph (c). An employee 
15.26 	who retires under the formula annuity before the normal retirement age is entitled to receive 
15.27 	the normal annuity provided in paragraph (d), reduced as described in clause (1) or (2), as 
15.28 	applicable.
15.29 	(1) For a member who is at least age 62 and has at least 30 years of service, the annuity 
15.30 	shall be reduced by an early reduction factor of six percent for each year that the member's 
15.31 	age of retirement precedes the normal retirement age. The resulting reduced annuity shall 
15.32 	be further adjusted to take into account the increase in the monthly amount that would have 
15.33 	occurred had the member retired early and deferred receipt of the annuity until normal 
15.34 	retirement age and the annuity was augmented during the deferral period at 2.5 percent, if 
16.1 	the member commenced employment after June 30, 2006, or at three percent, if the member 
16.2 	commenced employment before July 1, 2006, compounded annually.
16.3 	(2) For a member who has not attained age 62 or has fewer than 30 years of service, the 
16.4 	annuity shall be reduced for each year that the member's age of retirement precedes normal 
16.5 	retirement age by the following early reduction factors:
16.6 	(i) for the period during which the member is age 55 through age 59, the factor is four 
16.7 	percent; and
16.8 	(ii) for the period during which the member is age 60 but not yet normal retirement age, 
16.9 	the factor is seven percent.
16.10 	The resulting annuity shall be further adjusted to take into account the increase in the 
16.11 	monthly amount that would have occurred had the member retired early and deferred receipt 
16.12 	of the annuity until normal retirement age and the annuity was augmented during the deferral 
16.13 	period at the applicable annual rate, compounded annually. The applicable annual rate is 
16.14 	the rate in effect for the month that includes the member's effective date of retirement and 
16.15 	shall be considered as fixed for the member for the period until the member reaches normal 
16.16 	retirement age. The applicable annual rate for June 2019 is 2.5 percent, if the member 
16.17 	commenced employment after June 30, 2006, or three percent, if the member commenced 
16.18 	employment before July 1, 2006, compounded annually, and decreases each month beginning 
16.19 	July 2019 in equal monthly increments over the five-year period that begins July 1, 2019, 
16.20 	and ends June 30, 2024, to zero percent effective for July 2024 and thereafter.
16.21 	After June 30, 2024, the reduced annuity commencing before normal retirement age 
16.22 	under this clause shall not take into account any augmentation.
16.23 	(h) After June 30, 2015, and before July 1, 2020 2019, for a person who would have a 
16.24 	reduced retirement annuity under either paragraph (e) or (f) if they were applicable, the 
16.25 	employee is entitled to receive a reduced annuity which must be calculated using a blended 
16.26 	reduction factor augmented monthly by 1/60 of the difference between the reduction required 
16.27 	under paragraph (e) and the reduction required under paragraph (f).
16.28 	(h)(i) No retirement annuity is payable to a former employee with a salary that exceeds 
16.29 	95 percent of the governor's salary unless and until the salary figures used in computing the 
16.30 	highest five successive years average salary under paragraph (a) have been audited by the 
16.31 	Teachers Retirement Association and determined by the executive director to comply with 
16.32 	the requirements and limitations of section 354.05, subdivisions 35 and 35a.

16.33 	EFFECTIVE DATE. This section is effective July 1, 2018.

17.1 	Sec. 2. Minnesota Statutes 2016, section 354.49, subdivision 2, is amended to read:
17.2 		Subd. 2.Calculation. (a) Except as provided in section 354.44, subdivision 1, any person 
17.3 	who ceases to be a member by reason of termination of teaching service, is entitled to receive 
17.4 	a refund in an amount equal to the accumulated deductions credited to the account plus 
17.5 	interest compounded annually using the following interest rates:
17.6 	(1) before July 1, 1957, no interest accrues;
17.7 	(2) July 1, 1957, to June 30, 2011, six percent; and
17.8 	(3) after June 30 July 1, 2011, to June 30, 2018, four percent; and
17.9 	(4) after June 30, 2018, three percent.
17.10 	For the purpose of this subdivision, interest must be computed on fiscal year end balances 
17.11 	to the first day of the month in which the refund is issued.
17.12 	(b) If the person has received permanent disability payments under section 354.48, the 
17.13 	refund amount must be reduced by the amount of those payments.

17.14 	EFFECTIVE DATE. This section is effective July 1, 2018.

17.15 	Sec. 3. Minnesota Statutes 2016, section 354.55, subdivision 11, is amended to read:
17.16 		Subd. 11.Deferred annuity; augmentation. (a) Any person covered under section 
17.17 	354.44, subdivision 6, who ceases to render teaching service, may leave the person's 
17.18 	accumulated deductions in the fund for the purpose of receiving a deferred annuity at 
17.19 	retirement.
17.20 	(b) The amount of the deferred retirement annuity is determined by section 354.44, 
17.21 	subdivision 6, andof any former member must be augmented as provided in this subdivision. 
17.22 	The required reserves for the annuity which had accrued when the member ceased to render 
17.23 	teaching service must be augmented, as further specified in this subdivision, by the applicable 
17.24 	interest rate compounded annually from the first day of the month following the month 
17.25 	during which the member ceased to render teachingtermination of active service to the 
17.26 	effective date of retirement.
17.27 	(c) No augmentation is not creditable if the deferral period is less than three months or 
17.28 	if deferral commenced before July 1, 1971.
17.29 	(d) For persons who became covered employees before July 1, 2006, with a deferral 
17.30 	period commencing after June 30, 1971, the annuity must be augmented as follows at the 
17.31 	following rate or rates, compounded annually:
18.1 	(1) five percent interest compounded annually until January 1, 1981;
18.2 	(2) three percent interest compounded annually from January 1, 1981, until January 1 
18.3 	of the year following the year in which the deferred annuitant attains age 55 or June 30, 
18.4 	2012, whichever is earlier;
18.5 	(3) five percent interest compounded annually from the date established in clause (2) to 
18.6 	the effective date of retirement or until June 30, 2012, whichever is earlier; and
18.7 	(4) two percent interest compounded annually after June 30, 2012 from July 1, 2012, 
18.8 	until June 30, 2019; and
18.9 	(5) after June 30, 2019, the deferred annuity must not be augmented.
18.10 	(e) For persons who become covered employees after June 30, 2006, the interest rate 
18.11 	used to augment the deferred annuity ismust be augmented at the following rate or rates, 
18.12 	compounded annually:
18.13 	(1) 2.5 percent interest compounded annually until June 30, 2012, or until the effective 
18.14 	date of retirement, whichever is earlier, and;
18.15 	(2) two percent interest compounded annually after June 30 from July 1, 2012, until 
18.16 	June 30, 2019; and
18.17 	(3) after June 30, 2019, the deferred annuity must not be augmented.
18.18 	(f) If a person has more than one period of uninterrupted service, a separate average 
18.19 	salary determined under section 354.44, subdivision 6, must be used for each period and 
18.20 	the required reserves related to each period must be augmented as specified in this 
18.21 	subdivision. The sum of the augmented required reserves is the present value of the annuity. 
18.22 	For the purposes of this subdivision, "period of uninterrupted service" means a period of 
18.23 	covered teaching service during which the member has not been separated from active 
18.24 	service for more than one fiscal year.
18.25 	(g) If a person repays a refund, the service restored by the repayment must be considered 
18.26 	as continuous with the next period of service for which the person has allowable service 
18.27 	credit in the Teachers Retirement Association.
18.28 	(h) If a person does not render teaching service in any one fiscal year or more consecutive 
18.29 	fiscal years and then resumes teaching service, the formula percentages used from the date 
18.30 	of the resumption of teaching service must be those applicable to new members.
18.31 	(i) The mortality table and interest rate actuarial assumption used to compute the annuity 
18.32 	must be the applicable mortality table established by the board under section 354.07, 
19.1 	subdivision 1, and the interest rate actuarial assumption under section 356.215 in effect 
19.2 	when the member retires.
19.3 	(j)(f) In no case may the annuity payable under this subdivision be less than the amount 
19.4 	of annuity payable under section 354.44, subdivision 6.
19.5 	(k)(g) The requirements and provisions for retirement before normal retirement age 
19.6 	contained in section 354.44, subdivision 6, also apply to an employee fulfilling the 
19.7 	requirements with a combination of service as provided in section 354.60 356.311.
19.8 	(l)(h) The augmentation provided by this subdivision applies to the benefit provided in 
19.9 	section 354.46, subdivision 2.
19.10 	(m)(i) The augmentation provided by this subdivision does not apply to any period in 
19.11 	which a person is on an approved leave of absence from an employer unit covered by the 
19.12 	provisions of this chapter.
19.13 	(n)(j) The retirement annuity or disability benefit of, or the survivor benefit payable on 
19.14 	behalf of, a former teacher who terminated service before July 1, 1997, which is not first 
19.15 	payable until after June 30, 1997, must be increased on an actuarial equivalent basis to 
19.16 	reflect the change in the postretirement interest rate actuarial assumption under section 
19.17 	356.215, subdivision 8, from five percent to six percent under a calculation procedure and 
19.18 	tables adopted by the board as recommended by an approved actuary and approved by the 
19.19 	actuary retained under section 356.214.

19.20 	EFFECTIVE DATE. This section is effective July 1, 2018.

19.21 	Sec. 4.  REPEALER.
 19.22 	Minnesota Statutes 2016, sections 354.42, subdivisions 4a, 4b, 4c, and 4d; and 354.60,
19.23 	are repealed.

19.24 	EFFECTIVE DATE. This section is effective July 1, 2018.

19.25 	ARTICLE 4
19.26 	ST. PAUL TEACHERS RETIREMENT FUND ASSOCIATION
19.27 	BENEFIT AND CONTRIBUTION CHANGES

19.28 	Section 1. Minnesota Statutes 2016, section 354A.011, subdivision 3a, is amended to read:
19.29 		Subd. 3a.Actuarial equivalent. "Actuarial equivalent" means the condition of one 
19.30 	annuity or benefit having an equal actuarial present value as another annuity or benefit, 
19.31 	determined as of a given date with each actuarial present value based on the appropriate 
20.1 	mortality table adopted by the appropriate board of trustees based on the experience of that 
20.2 	retirement fund association as recommended by the actuary retained under section 356.214, 
20.3 	and approved under section 356.215, subdivision 18, and using the applicable preretirement 
20.4 	or postretirement interest rateinvestment return assumption specified in section 356.215, 
20.5 	subdivision 8.

20.6 	EFFECTIVE DATE. This section is effective July 1, 2018.

20.7 	Sec. 2. Minnesota Statutes 2016, section 354A.29, subdivision 7, is amended to read:
20.8 		Subd. 7.Eligibility for payment of Postretirement adjustments. (a) Annually, after 
20.9 	June 30, the board of trustees of the St. Paul Teachers Retirement Fund Association must 
20.10 	determine the amount of any postretirement adjustment using the procedures in this 
20.11 	subdivision and subdivision 8 or 9, whichever is applicable.
20.12 	(b) On January 1 (a) Except as set forth in paragraph (c), each person who has been 
20.13 	receiving an annuity or benefit under the articles of incorporation, the bylaws, or this chapter, 
20.14 	whose effective date of benefit commencement occurred on or before July 1 of the calendar 
20.15 	year immediately before the adjustment, is eligible to receive aan annual postretirement 
20.16 	increase as specified in subdivision 8 or 9. adjustment, effective as of each January 1, as 
20.17 	follows:
20.18 	(1) there shall be no postretirement adjustment on January 1, 2019, and January 1, 2020; 
20.19 	and
20.20 	(2) the postretirement adjustment shall be one percent on January 1, 2021, and each 
20.21 	January 1 thereafter.
20.22 	(b) The amount determined under paragraph (a), clause (2), is the full postretirement 
20.23 	adjustment to be applied as a permanent increase to the regular payment of each eligible 
20.24 	member on January 1 of the next calendar year. For any eligible member whose effective 
20.25 	date of benefit commencement occurred after January 1 of the calendar year immediately 
20.26 	before the postretirement adjustment is applied, the amount determined under paragraph 
20.27 	(a), clause (2), must be reduced by 50 percent.
20.28 	(c) Each person who retires on or after July 1, 2024, is entitled to an annual postretirement 
20.29 	adjustment, effective as of each January 1, beginning with the year following the year in 
20.30 	which the member attains normal retirement age.
20.31 	(d) Paragraph (c) does not apply to members who retire under section 354A.31, 
20.32 	subdivision 6, paragraph (b), or who retire when the member is at least age 62 and has at 
20.33 	least 30 years of service under section 354A.31, subdivision 7.

21.1 	EFFECTIVE DATE. This section is effective July 1, 2018.

21.2 	Sec. 3. Minnesota Statutes 2016, section 354A.31, subdivision 7, is amended to read:
21.3 		Subd. 7. Reduction for early retirement. (a) This subdivision applies to a person who 
21.4 	has become at least 55 years old and first becomes a coordinated member after June 30, 
21.5 	1989, and to any other coordinated member who has become at least 55 years old and whose 
21.6 	annuity is higher when calculated using the retirement annuity formula percentage in 
21.7 	subdivision 4, paragraph (d), or subdivision 4a, paragraph (d), as applicable, in conjunction 
21.8 	with this subdivision than when calculated under subdivision 4, paragraph (c), or subdivision 
21.9 	4a, paragraph (c), in conjunction with subdivision 6. An employee who retires under the 
21.10 	formula annuity before the normal retirement age shall be paid the normal annuity reduced 
21.11 	as described in paragraph (b) if the person retires on or after July 1, 2019, or in paragraph 
21.12 	(c) if the person retires before July 1, 2019, as applicable.
21.13 	(b) A coordinated member who retires before the normal retirement age and on or after 
21.14 	July 1, 2019, is entitled to receive a retirement annuity calculated using the retirement 
21.15 	annuity formula percentage in subdivision 4, paragraph (d), or subdivision 4a, paragraph 
21.16 	(d), whichever applies, reduced as described in clause (1) or (2), as applicable.
21.17 	(1) If the member retires when the member is younger than age 62 or with fewer than 
21.18 	30 years of service, the annuity must be reduced by an early reduction factor for each year 
21.19 	that the member's age of retirement precedes normal retirement age. The early reduction 
21.20 	factors are four percent per year for ages 55 through 59 and seven percent per year for ages 
21.21 	60 through normal retirement age. The resulting annuity must be further adjusted to take 
21.22 	into account augmentation as if the employee had deferred receipt of the annuity until normal 
21.23 	retirement age and the annuity were augmented at the applicable annual rate, compounded 
21.24 	annually, from the day the annuity begins to accrue until normal retirement age. The 
21.25 	applicable annual rate is the rate in effect on the employee's effective date of retirement and 
21.26 	shall be considered as fixed for the employee. The applicable annual rates are the following:
21.27 	(i) until June 30, 2019, 2.5 percent;
21.28 	(ii) a rate that changes each month, beginning July 1, 2019, through June 30, 2024, which 
21.29 	is determined by reducing the rate in item (i) to zero in equal monthly increments over the 
21.30 	five-year period; and
21.31 	(iii) after June 30, 2024, zero percent.
21.32 	After June 30, 2024, the reduced annuity commencing before normal retirement age 
21.33 	under this clause shall not take into account any augmentation.
22.1 	(2) If the member retires when the member is at least age 62 or older and has at least 30 
22.2 	years of service, the member is entitled to receive a retirement annuity calculated using the 
22.3 	retirement annuity formula percentage in subdivision 4, paragraph (d), or subdivision 4a, 
22.4 	paragraph (c), whichever applies, multiplied by the applicable early retirement factor 
22.5 	specified for members "Age 62 or older with 30 years of service" in the table in paragraph 
22.6 	(c).
22.7 	(c) A coordinated member who retires before the normal retirement age and before July 
22.8 	1, 2019, is entitled to receive a retirement annuity calculated using the retirement annuity 
22.9 	formula percentage in subdivision 4, paragraph (d), or subdivision 4a, paragraph (d), 
22.10 	whichever applies, multiplied by the applicable early retirement factor specified below:

22.11		Under age 62
	Age 62 or older
	
22.12		or less than 30 years of service
	with 30 years of service

22.13	Normal retirement age:
	65
	66
	65
	66
	
22.14	Age at retirement
					
22.15	55
	0.5376
	0.4592
			
22.16	56
	0.5745
	0.4992
			
22.17	57
	0.6092
	0.5370
			
22.18	58
	0.6419
	0.5726
			
22.19	59
	0.6726
	0.6062
			
22.20	60
	0.7354
	0.6726
			
22.21	61
	0.7947
	0.7354
			
22.22	62
	0.8507
	0.7947
	0.8831
	0.8389
	
22.23	63
	0.9035
	0.8507
	0.9246
	0.8831
	
22.24	64
	0.9533
	0.9035
	0.9635
	0.9246
	
22.25	65
	1.0000
	0.9533
	1.0000
	0.9635
	
22.26	66
		1.0000
		1.0000
	
22.27 	For normal retirement ages between ages 65 and 66, the early retirement factors must 
22.28 	be determined by linear interpolation between the early retirement factors applicable for 
22.29 	normal retirement ages 65 and 66.

22.30 	EFFECTIVE DATE. This section is effective July 1, 2018.

22.31 	Sec. 4. Minnesota Statutes 2016, section 354A.37, subdivision 2, is amended to read:
22.32 		Subd. 2.Eligibility for deferred retirement annuity. (a) Any coordinated member 
22.33 	who ceases to render teaching services for the school district in which the teachers retirement 
22.34 	fund association is located, with sufficient allowable service credit to meet the minimum 
23.1 	service requirements specified in section 354A.31, subdivision 1, shall be entitled to a 
23.2 	deferred retirement annuity in lieu of a refund under subdivision 1.
23.3 	(b) The deferred retirement annuity must be computed under section 354A.31 and shall 
23.4 	be augmented as provided in this subdivision from the first day of the month following the 
23.5 	termination of active service to the effective date of retirement. There is no augmentation 
23.6 	if this period is less than three months.
23.7 	(c) The deferred annuity commences upon application after the person on deferred status 
23.8 	attains at least the minimum age specified in section 354A.31, subdivision 1.
23.9 	(b) The monthly annuity amount that had accrued when the member ceased to render 
23.10 	teaching service must be augmented from the first day of the month following the month 
23.11 	during which the member ceased to render teaching service to the effective date of retirement. 
23.12 	There is no augmentation if this period is less than three months. The rate of augmentation 
23.13 	is
23.14 	(d) For a person who became a covered employee before July 1, 2006, the annuity must 
23.15 	be augmented at the following rate or rates, compounded annually:
23.16 	(1) three percent compounded annually until January 1 of the year following the year 
23.17 	in which the former member attains age 55,or June 30, 2012, whichever is earlier;
23.18 	(2) five percent compounded annually after that date to July 1 from the January 1 next 
23.19 	following the attainment of age 55 or until June 30, 2012, and;
23.20 	(3) two percent compounded annually after that date to the effective date of retirement 
23.21 	if the employee became an employee before July 1, 2006, and atfrom July 1, 2012, until 
23.22 	June 30, 2019; and
23.23 	(4) after June 30, 2019, the deferred annuity must not be augmented.
23.24 	(e) For a person who became a covered employee after June 30, 2006, the annuity must 
23.25 	be augmented at the following rate or rates, compounded annually:
23.26 	(1) 2.5 percent compounded annually to July 1, 2012, anduntil June 30, 2012;
23.27 	(2) two percent compounded annually after that date to the effective date of retirement 
23.28 	if the employee became an employee after June 30, 2006. If a person has more than one 
23.29 	period of uninterrupted service, a separate average salary determined under section 354A.31
23.30 	must be used for each period, and the monthly annuity amount related to each period must 
23.31 	be augmented as provided in this subdivision. The sum of the augmented monthly annuity 
23.32 	amounts determines the total deferred annuity payable. If a person repays a refund, the 
24.1 	service restored by the repayment must be considered as continuous with the next period 
24.2 	of service for which the person has credit with the fund. If a person does not render teaching 
24.3 	services in any one fiscal year or more consecutive fiscal years and then resumes teaching 
24.4 	service, the formula percentages used from the date of resumption of teaching service are 
24.5 	those applicable to new members. The mortality table and interest assumption used to 
24.6 	compute the annuity are the table established by the fund to compute other annuities, and 
24.7 	the interest assumption under section 356.215 in effect when the member retires. A period 
24.8 	of uninterrupted service for the purpose of this subdivision means a period of covered 
24.9 	teaching service during which the member has not been separated from active service for 
24.10 	more than one fiscal year. from July 1, 2012, until June 30, 2019; and
24.11 	(3) after June 30, 2019, the deferred annuity must not be augmented.
24.12 	(c) (f) The augmentation provided by this subdivision applies to the benefit provided in 
24.13 	section 354A.35, subdivision 2. The augmentation provided by this subdivision does not 
24.14 	apply to any period in which a person is on an approved leave of absence from an employer 
24.15 	unit.

24.16 	EFFECTIVE DATE. This section is effective July 1, 2018.

24.17 	Sec. 5. Minnesota Statutes 2016, section 354A.37, subdivision 3, is amended to read:
24.18 		Subd. 3.Computation of refund amount. A former coordinated member who qualifies 
24.19 	for a refund under subdivision 1 is entitled to receive a refund equal to the amount of the 
24.20 	former coordinated member's accumulated employee contributions with interest at the rate 
24.21 	offollowing rates for the applicable period:
24.22 	(1) Six percent per annum compounded annually to July 1, 2011, if the person is a former 
24.23 	member of the St. Paul Teachers Retirement Fund Association, and;
24.24 	(2) four percent per annum compounded annually to July 1, 2018; and
24.25 	(3) three percent per annum compounded annually thereafter.

24.26 	EFFECTIVE DATE. This section is effective July 1, 2018.

24.27 	Sec. 6.  REPEALER.
 24.28 	(a) Minnesota Statutes 2016, section 354A.29, subdivisions 8 and 9, are repealed.
24.29 	(b) Minnesota Statutes 2016, section 354A.39, is repealed.

24.30 	EFFECTIVE DATE. Paragraph (a) is effective the day following final enactment. 
24.31 	Paragraph (b) is effective July 1, 2018.

25.1 	ARTICLE 5
25.2 	ACTUARIAL ASSUMPTIONS AND
25.3 	POSTRETIREMENT ADJUSTMENTS FOR STATEWIDE PLANS

25.4 	Section 1. Minnesota Statutes 2017 Supplement, section 356.215, subdivision 8, is amended 
25.5 	to read:
25.6 		Subd. 8.Interest and salary Actuarial assumptions. (a) The actuarial valuation must 
25.7 	use the applicable following interest investment return assumption:
25.8 	(1) select and ultimate interest rate assumption

25.1025.9	plan
	ultimate interest rate 
assumption
		
25.11	teachers retirement plan
	8.5%
		
25.12 	The select preretirement interest rate assumption for the period through June 30, 2017, 
25.13 	is eight percent.
25.14 	(2) single rate interest rate assumption

25.1725.15
25.16
	plan
	interest rate
investment return
assumption
		
25.18	general state employees retirement plan
	8 7.5%
		
25.19	correctional state employees retirement plan
	8 7.5
		
25.20	State Patrol retirement plan
	8 7.5
		
25.21
25.22
25.23	legislators retirement plan, and for the 
constitutional officers calculation of total plan 
liabilities
	0
		
25.24	judges retirement plan
	8 7.5
		
25.25	general public employees retirement plan
	8 7.5
		
25.26	public employees police and fire retirement plan
	8 7.5
		
25.27
25.28	local government correctional service retirement 
plan
	8 7.5
		
25.29	teachers retirement plan
	7.5
		
25.30	St. Paul teachers retirement plan
	8 7.5
		
25.31	Bloomington Fire Department Relief Association
	6
		
25.32
25.33	local monthly benefit volunteer firefighter relief 
associations
	5
		
25.34
25.35	monthly benefit retirement plans in the statewide 
volunteer firefighter retirement plan
	6
		
25.36 	(b)(1) If funding stability has been attained, The actuarial valuation for each of the 
25.37 	covered retirement plans listed in section 356.415, subdivision 2, must use a take into account 
26.1 	the postretirement adjustment rate actuarial assumption equal to the postretirement adjustment 
26.2 	rate or rates applicable to the plan as specified in section 354A.29, subdivision 9 7, or 
26.3 	356.415, subdivision 1, whichever applies.
26.4 	(2) If funding stability has not been attained, the valuation must use a select postretirement 
26.5 	adjustment rate actuarial assumption equal to the postretirement adjustment rate specified 
26.6 	in section 354A.29, subdivision 8, or 356.415, subdivision 1a, 1b, 1c, 1d, 1e, or 1f, whichever 
26.7 	applies, for a period ending when the approved actuary estimates that the plan will attain 
26.8 	the defined funding stability measure, and thereafter an ultimate postretirement adjustment 
26.9 	rate actuarial assumption equal to the postretirement adjustment rate under section 354A.29, 
26.10 	subdivision 9, or 356.415, subdivision 1, for the applicable period or periods beginning 
26.11 	when funding stability is projected to be attained.
26.12 	(c) The actuarial valuation must use the applicable following single rate future salary 
26.13 	increase assumption, the applicable following modified single rate future salary increase 
26.14 	assumption, or the applicable following graded rate future salary increase assumption:
26.15 	(1) single rate future salary increase assumption

26.16	plan
	future salary increase assumption
	
26.17	legislators retirement plan
		5%
	
26.18	judges retirement plan
		2.75
	
26.19	Bloomington Fire Department Relief Association
		4
	
26.20 	(2) age-related future salary increase age-related select and ultimate future salary increase 
26.21 	assumption or graded rate future salary increase assumption

26.22	plan
	future salary increase assumption
	
26.23	local government correctional service retirement plan
	assumption B
	
26.24	St. Paul teachers retirement plan
	assumption A
	
26.25 	For plans other than the St. Paul teachers 
26.26 	retirement plan and the local government 
26.27 	correctional service retirement plan, the select 
26.28 	calculation is: during the designated select 
26.29 	period, a designated percentage rate is 
26.30 	multiplied by the result of the designated 
26.31 	integer minus T, where T is the number of 
26.32 	completed years of service, and is added to 
26.33 	the applicable future salary increase 
26.34 	assumption. The designated select period is 
27.1 	ten years and the designated integer is ten for 
27.2 	the local government correctional service 
27.3 	retirement plan and 15 for the St. Paul 
27.4 	Teachers Retirement Fund Association. The 
27.5 	designated percentage rate is 0.2 percent for 
27.6 	the St. Paul Teachers Retirement Fund 
27.7 	Association.
27.8 	The ultimate future salary increase assumption is:

27.9	age
	A
	B
		
27.10	16
	5.9%
	8.75%
		
27.11	17
	5.9
	8.75
		
27.12	18
	5.9
	8.75
		
27.13	19
	5.9
	8.75
		
27.14	20
	5.9
	8.75
		
27.15	21
	5.9
	8.5
		
27.16	22
	5.9
	8.25
		
27.17	23
	5.85
	8
		
27.18	24
	5.8
	7.75
		
27.19	25
	5.75
	7.5
		
27.20	26
	5.7
	7.25
		
27.21	27
	5.65
	7
		
27.22	28
	5.6
	6.75
		
27.23	29
	5.55
	6.5
		
27.24	30
	5.5
	6.5
		
27.25	31
	5.45
	6.25
		
27.26	32
	5.4
	6.25
		
27.27	33
	5.35
	6.25
		
27.28	34
	5.3
	6
		
27.29	35
	5.25
	6
		
27.30	36
	5.2
	5.75
		
27.31	37
	5.15
	5.75
		
27.32	38
	5.1
	5.75
		
27.33	39
	5.05
	5.5
		
27.34	40
	5
	5.5
		
27.35	41
	4.95
	5.5
		
27.36	42
	4.9
	5.25
		
27.37	43
	4.85
	5
		
28.1	44
	4.8
	5
		
28.2	45
	4.75
	4.75
		
28.3	46
	4.7
	4.75
		
28.4	47
	4.65
	4.75
		
28.5	48
	4.6
	4.75
		
28.6	49
	4.55
	4.75
		
28.7	50
	4.5
	4.75
		
28.8	51
	4.45
	4.75
		
28.9	52
	4.4
	4.75
		
28.10	53
	4.35
	4.75
		
28.11	54
	4.3
	4.75
		
28.12	55
	4.25
	4.5
		
28.13	56
	4.2
	4.5
		
28.14	57
	4.15
	4.25
		
28.15	58
	4.1
	4
		
28.16	59
	4.05
	4
		
28.17	60
	4
	4
		
28.18	61
	4
	4
		
28.19	62
	4
	4
		
28.20	63
	4
	4
		
28.21	64
	4
	4
		
28.22	65
	4
	3.75
		
28.23	66
	4
	3.75
		
28.24	67
	4
	3.75
		
28.25	68
	4
	3.75
		
28.26	69
	4
	3.75
		
28.27	70
	4
	3.75
		
28.28 	(3) service-related ultimate future salary increase assumption

28.29
28.30	general state employees retirement plan of the Minnesota 
State Retirement System
	assumption A
	
28.31
28.32	general employees retirement plan of the Public 
Employees Retirement Association
	assumption B
	
28.33	Teachers Retirement Association
	assumption C
	
28.34	public employees police and fire retirement plan
	assumption D
	
28.35	State Patrol retirement plan
	assumption E
	
28.36
28.37	correctional state employees retirement plan of the 
Minnesota State Retirement System
	assumption F

29.1
29.2	service 
length
	A
	B
	C
	D
	E
	F
	
29.3	1
	10.25%
	11.78%
	12%
	12.75%
	7.75%
	5.75%
	
29.4	2
	7.85
	8.65
	9
	10.75
	7.25
	5.6
	
29.5	3
	6.65
	7.21
	8
	8.75
	6.75
	5.45
	
29.6	4
	5.95
	6.33
	7.5
	7.75
	6.5
	5.3
	
29.7	5
	5.45
	5.72
	7.25
	6.25
	6.25
	5.15
	
29.8	6
	5.05
	5.27
	7
	5.85
	6
	5
	
29.9	7
	4.75
	4.91
	6.85
	5.55
	5.75
	4.85
	
29.10	8
	4.45
	4.62
	6.7
	5.35
	5.6
	4.7
	
29.11	9
	4.25
	4.38
	6.55
	5.15
	5.45
	4.55
	
29.12	10
	4.15
	4.17
	6.4
	5.05
	5.3
	4.4
	
29.13	11
	3.95
	3.99
	6.25
	4.95
	5.15
	4.3
	
29.14	12
	3.85
	3.83
	6
	4.85
	5
	4.2
	
29.15	13
	3.75
	3.69
	5.75
	4.75
	4.85
	4.1
	
29.16	14
	3.55
	3.57
	5.5
	4.65
	4.7
	4
	
29.17	15
	3.45
	3.45
	5.25
	4.55
	4.55
	3.9
	
29.18	16
	3.35
	3.35
	5
	4.55
	4.4
	3.8
	
29.19	17
	3.25
	3.26
	4.75
	4.55
	4.25
	3.7
	
29.20	18
	3.25
	3.25
	4.5
	4.55
	4.1
	3.6
	
29.21	19
	3.25
	3.25
	4.25
	4.55
	3.95
	3.5
	
29.22	20
	3.25
	3.25
	4
	4.55
	3.8
	3.5
	
29.23	21
	3.25
	3.25
	3.9
	4.45
	3.75
	3.5
	
29.24	22
	3.25
	3.25
	3.8
	4.35
	3.75
	3.5
	
29.25	23
	3.25
	3.25
	3.7
	4.25
	3.75
	3.5
	
29.26	24
	3.25
	3.25
	3.6
	4.25
	3.75
	3.5
	
29.27	25
	3.25
	3.25
	3.5
	4.25
	3.75
	3.5
	
29.28	26
	3.25
	3.25
	3.5
	4.25
	3.75
	3.5
	
29.29	27
	3.25
	3.25
	3.5
	4.25
	3.75
	3.5
	
29.30	28
	3.25
	3.25
	3.5
	4.25
	3.75
	3.5
	
29.31	29
	3.25
	3.25
	3.5
	4.25
	3.75
	3.5
	
29.32	30 or more
	3.25
	3.25
	3.5
	4.25
	3.75
	3.5
	
29.33 	(d) The actuarial valuation must use the applicable following payroll growth assumption 
29.34 	for calculating the amortization requirement for the unfunded actuarial accrued liability 
29.35 	where the amortization retirement is calculated as a level percentage of an increasing payroll:

29.36	plan
	payroll growth assumption
	
29.37
29.38	general state employees retirement plan of the Minnesota 
State Retirement System
	3.5%
	
30.1	correctional state employees retirement plan
	3.5
	
30.2	State Patrol retirement plan
	3.5
	
30.3	judges retirement plan
	2.75
	
30.4
30.5	general employees retirement plan of the Public 
Employees Retirement Association
	3.5
	
30.6	public employees police and fire retirement plan
	3.5
	
30.7	local government correctional service retirement plan
	3.5
	
30.8	teachers retirement plan
	3.75
	
30.9	St. Paul teachers retirement plan
	4
	
30.10 	(e) The assumptions set forth in paragraphs (c) and (d) continue to apply, unless a 
30.11 	different salary assumption or a different payroll increase assumption:
30.12 	(1) has been proposed by the governing board of the applicable retirement plan;
30.13 	(2) is accompanied by the concurring recommendation of the actuary retained under 
30.14 	section 356.214, subdivision 1, if applicable, or by the approved actuary preparing the most 
30.15 	recent actuarial valuation report if section 356.214 does not apply; and
30.16 	(3) has been approved or deemed approved under subdivision 18.

30.17 	EFFECTIVE DATE. This section is effective July 1, 2018.

30.18 	Sec. 2. Minnesota Statutes 2016, section 356.215, subdivision 9, is amended to read:
30.19 		Subd. 9.Other assumptions. The(a) Each plan's actuarial valuation must use 
30.20 	assumptions concerning base mortality rates, disability, retirement, withdrawal, retirement 
30.21 	age, and any other relevant demographic or economic factor. These assumptions must be 
30.22 	set at levels consistent with those determined in the most recent quadrennial experience 
30.23 	study completed under subdivision 16, if required, or representative of the best estimate of 
30.24 	future experience as recommended by the plan's approved actuary, if a quadrennial experience 
30.25 	study is not required.
30.26 	(b) The actuarial valuation may use an assumption concerning future mortality 
30.27 	improvement. This assumption may be set at levels consistent with those determined in the 
30.28 	most recent mortality improvement scale published by the Society of Actuaries or as 
30.29 	otherwise recommended by the plan's approved actuary.
30.30 	(c) The actuarial valuation must contain an exhibit indicating anythe actuarial 
30.31 	assumptions used in preparing the valuation report.

30.32 	EFFECTIVE DATE. This section is effective July 1, 2018.

31.1 	Sec. 3. Minnesota Statutes 2016, section 356.215, subdivision 11, is amended to read:
31.2 		Subd. 11.Amortization contributions. (a) In addition to the exhibit indicating the level 
31.3 	normal cost, the actuarial valuation of the retirement plan must contain an exhibit for financial 
31.4 	reporting purposes indicating the additional annual contribution sufficient to amortize the 
31.5 	unfunded actuarial accrued liability and must contain an exhibit for contribution 
31.6 	determination purposes indicating the additional contribution sufficient to amortize the 
31.7 	unfunded actuarial accrued liability. For the retirement plans listed in subdivision 8, paragraph 
31.8 	(c), but excluding the legislators retirement plan, the additional contribution must be 
31.9 	calculated on a level percentage of covered payroll basis by the established date for full 
31.10 	funding in effect when the valuation is prepared, assuming annual payroll growth at the 
31.11 	applicable percentage rate set forth in subdivision 8, paragraph (d). For all other retirement 
31.12 	plans and for the legislators retirement plan, the additional annual contribution must be 
31.13 	calculated on a level annual dollar amount basis.
31.14 	(b) For any retirement plan other than a retirement plan governed by paragraph (d), (e), 
31.15 	(f), (g), (h), (i), or (j), if there has not been a change in the actuarial assumptions used for 
31.16 	calculating the actuarial accrued liability of the fund, a change in the benefit plan governing 
31.17 	annuities and benefits payable from the fund, a change in the actuarial cost method used in 
31.18 	calculating the actuarial accrued liability of all or a portion of the fund, or a combination 
31.19 	of the three, which change or changes by itself or by themselves without inclusion of any 
31.20 	other items of increase or decrease produce a net increase in the unfunded actuarial accrued 
31.21 	liability of the fund, the established date for full funding is the first actuarial valuation date 
31.22 	occurring after June 1, 2020.
31.23 	(c) For any retirement plan, if there has been a change in any or all of the actuarial 
31.24 	assumptions used for calculating the actuarial accrued liability of the fund, a change in the 
31.25 	benefit plan governing annuities and benefits payable from the fund, a change in the actuarial 
31.26 	cost method used in calculating the actuarial accrued liability of all or a portion of the fund, 
31.27 	or a combination of the three, and the change or changes, by itself or by themselves and 
31.28 	without inclusion of any other items of increase or decrease, produce a net increase in the 
31.29 	unfunded actuarial accrued liability in the fund, the established date for full funding must 
31.30 	be determined using the following procedure:
31.31 	(i) the unfunded actuarial accrued liability of the fund must be determined in accordance 
31.32 	with the plan provisions governing annuities and retirement benefits and the actuarial 
31.33 	assumptions in effect before an applicable change;
32.1 	(ii) the level annual dollar contribution or level percentage, whichever is applicable, 
32.2 	needed to amortize the unfunded actuarial accrued liability amount determined under item 
32.3 	(i) by the established date for full funding in effect before the change must be calculated 
32.4 	using the interest assumption specified in subdivision 8 in effect before the change;
32.5 	(iii) the unfunded actuarial accrued liability of the fund must be determined in accordance 
32.6 	with any new plan provisions governing annuities and benefits payable from the fund and 
32.7 	any new actuarial assumptions and the remaining plan provisions governing annuities and 
32.8 	benefits payable from the fund and actuarial assumptions in effect before the change;
32.9 	(iv) the level annual dollar contribution or level percentage, whichever is applicable, 
32.10 	needed to amortize the difference between the unfunded actuarial accrued liability amount 
32.11 	calculated under item (i) and the unfunded actuarial accrued liability amount calculated 
32.12 	under item (iii) over a period of 30 years from the end of the plan year in which the applicable 
32.13 	change is effective must be calculated using the applicable interest assumption specified in 
32.14 	subdivision 8 in effect after any applicable change;
32.15 	(v) the level annual dollar or level percentage amortization contribution under item (iv) 
32.16 	must be added to the level annual dollar amortization contribution or level percentage 
32.17 	calculated under item (ii);
32.18 	(vi) the period in which the unfunded actuarial accrued liability amount determined in 
32.19 	item (iii) is amortized by the total level annual dollar or level percentage amortization 
32.20 	contribution computed under item (v) must be calculated using the interest assumption 
32.21 	specified in subdivision 8 in effect after any applicable change, rounded to the nearest 
32.22 	integral number of years, but not to exceed 30 years from the end of the plan year in which 
32.23 	the determination of the established date for full funding using the procedure set forth in 
32.24 	this clause is made and not to be less than the period of years beginning in the plan year in 
32.25 	which the determination of the established date for full funding using the procedure set forth 
32.26 	in this clause is made and ending by the date for full funding in effect before the change; 
32.27 	and
32.28 	(vii) the period determined under item (vi) must be added to the date as of which the 
32.29 	actuarial valuation was prepared and the date obtained is the new established date for full 
32.30 	funding.
32.31 	(d) For the general employees retirement plan of the Public Employees Retirement 
32.32 	Association, the established date for full funding is June 30, 2031 2048.
32.33 	(e) For the Teachers Retirement Association, the established date for full funding is June 
32.34 	30, 20372048.
33.1 	(f) For the correctional state employees retirement plan and the State Patrol retirement 
33.2 	plan of the Minnesota State Retirement System, the established date for full funding is June 
33.3 	30, 2038 2048.
33.4 	(g) For the judges retirement plan, the established date for full funding is June 30, 2038
33.5 	2048.
33.6 	(h) For the local government correctional service retirement plan and the public employees 
33.7 	police and fire retirement plan, the established date for full funding is June 30, 2038 2048.
33.8 	(i) For the St. Paul Teachers Retirement Fund Association, the established date for full 
33.9 	funding is June 30, 2042. In addition to other requirements of this chapter, the annual 
33.10 	actuarial valuation must contain an exhibit indicating the funded ratio and the deficiency 
33.11 	or sufficiency in annual contributions when comparing liabilities to the market value of the 
33.12 	assets of the fund as of the close of the most recent fiscal year 2048.
33.13 	(j) For the general state employees retirement plan of the Minnesota State Retirement 
33.14 	System, the established date for full funding is June 30, 2040 2048.
33.15 	(k) For the retirement plans for which the annual actuarial valuation indicates an excess 
33.16 	of valuation assets over the actuarial accrued liability, the valuation assets in excess of the 
33.17 	actuarial accrued liability must be recognized as a reduction in the current contribution 
33.18 	requirements by an amount equal to the amortization of the excess expressed as a level 
33.19 	percentage of pay over a 30-year period beginning anew with each annual actuarial valuation 
33.20 	of the plan.

33.21 	EFFECTIVE DATE. This section is effective July 1, 2018.

33.22 	Sec. 4. Minnesota Statutes 2016, section 356.30, subdivision 1, is amended to read:
33.23 		Subdivision 1.Eligibility; computation of annuity. (a) Notwithstanding any provisions 
33.24 	of the laws governing the covered retirement plans enumeratedlisted in subdivision 3, a 
33.25 	person who has met the qualifications of paragraph (b) may elect to receive, upon retirement,
33.26 	a retirement annuity from each enumeratedcovered retirement plan in which the person has 
33.27 	at least one-half year of allowable service, based on the allowable service in each plan, 
33.28 	subject to the provisions of paragraph (c). (b), if the person has:
33.29 	(1) allowable service in any two or more of the covered plans;
33.30 	(2) at least one-half year of allowable service in each covered plan, based on the allowable 
33.31 	service in each plan;
34.1 	(3) total allowable service that equals or exceeds the longest service credit vesting 
34.2 	requirement of the applicable retirement plan; and
34.3 	(4) not begun to receive an annuity from any covered plan or has made application for 
34.4 	benefits from each applicable plan and the retirement annuity effective dates of each plan 
34.5 	are within a one-year period.
34.6 	(b) A person may receive, upon retirement, a retirement annuity from each enumerated 
34.7 	retirement plan in which the person has at least one-half year of allowable service, and 
34.8 	augmentation of a deferred annuity calculated at the appropriate rate under the laws governing 
34.9 	each public pension plan or fund named in subdivision 3, based on the date of the person's 
34.10 	initial entry into public employment from the date the person terminated all public service 
34.11 	if:
34.12 	(1) the person has allowable service in any two or more of the enumerated plans;
34.13 	(2) the person has sufficient allowable service in total that equals or exceeds the applicable 
34.14 	service credit vesting requirement of the retirement plan with the longest applicable service 
34.15 	credit vesting requirement; and
34.16 	(3) the person has not begun to receive an annuity from any enumerated plan or the 
34.17 	person has made application for benefits from each applicable plan and the effective dates 
34.18 	of the retirement annuity with each plan under which the person chooses to receive an 
34.19 	annuity are within a one-year period.
34.20 	(c)(b) If all requirements in paragraph (a) have been satisfied, the retirement annuity 
34.21 	from each plan must be based upon the allowable service, accrual rates, and average salary 
34.22 	in the applicable plan except as further specified or modified in the following clauses:
34.23 	(1) the laws governing annuities must be the law in effect on the date of termination 
34.24 	from the last period of public service under a covered retirement plan with which the person 
34.25 	earned a minimum of one-half year of allowable service credit during that employment;
34.26 	(2) the "average salary" on which the annuity from each covered plan in which the 
34.27 	employee has credit in aused to calculate the annuity for each formula plan must be based 
34.28 	on the employee's highest five successive years of covered salary during the entire service 
34.29 	in covered plans;
34.30 	(3) the accrual rates to be used byunder each plan must be thosethe percentages 
34.31 	prescribed by each plan's formula as continuedin effect for the respective years of allowable 
34.32 	service from one plan to the next, recognizing all previous allowable service with the other 
34.33 	covered plans;
35.1 	(4) the allowable service in all the covered plans must be combined in determining 
35.2 	eligibility for and the application of each plan's provisions inwith respect to reduction in 
35.3 	the annuity amount for retirement prior to normal retirement age; and
35.4 	(5) the annuity amount payable for any allowable service under a nonformula plan of
35.5 	that is a covered plan must not be affected, but such service and covered salary must be 
35.6 	used in the above calculation.
35.7 	(c) If a person eligible for an annuity under paragraph (a) from each covered plan 
35.8 	terminates all public service, the deferred annuity must be augmented from the date of 
35.9 	termination until the earlier of:
35.10 	(1) the effective date of retirement; or
35.11 	(2) December 31, 2018, for the Minnesota State Retirement System and the Public 
35.12 	Employees Retirement Association or June 30, 2019, for the Teachers Retirement Association 
35.13 	and the St. Paul Teachers Retirement Association.
35.14 	A deferred annuity must not be augmented after the applicable dates under clause (2). 
35.15 	The appropriate rate of augmentation is the rate in effect on the date on which the person 
35.16 	entered into public employment and subsequently adjusted according to the laws governing 
35.17 	each covered plan, as applicable.
35.18 	(d) This section does not apply to any person whose final termination from the last public 
35.19 	service under a covered plan was before May 1, 1975.
35.20 	(e) For the purpose of computing annuities under this section, the accrual rates used by 
35.21 	any covered plan, except the public employees police and fire plan, the judges retirement 
35.22 	fund, and the State Patrol retirement plan, must not exceed 2.7 percent per year of service 
35.23 	for any year of service or fraction thereof. The formula percentage used by:
35.24 	(1) the judges retirement fund accrual rate must not exceed 3.2 percent per year of service 
35.25 	for any year of service or fraction thereof. The accrual rate used by;
35.26 	(2) the public employees police and fire plan and the State Patrol retirement plan accrual 
35.27 	rate must not exceed 3.0 percent per year of service for any year of service or fraction 
35.28 	thereof. The accrual rate or rates used by;
35.29 	(3) the legislators retirement plan accrual rate must not exceed 2.5 percent, but this limit 
35.30 	does not apply to the adjustment provided under section 3A.02, subdivision 1, paragraph 
35.31 	(c).; and
36.1 	(4) any other covered plan's accrual rate must not exceed 2.7 percent per year of service 
36.2 	for any year of service or fraction thereof.
36.3 	(f) Any period of time for which a person has credit in more than one of the covered 
36.4 	plans must be used only once for the purpose of determining total allowable service.
36.5 	(g) If the period of duplicated service credit is more than one-half year, or the person 
36.6 	has credit for more than one-half year, with each of the plans, each plan must apply its 
36.7 	formula to a prorated service credit for the period of duplicated service based on a fraction 
36.8 	of the salary on which deductions were paid to that fund for the period divided by the total 
36.9 	salary on which deductions were paid to all plans for the period.
36.10 	(h) If the period of duplicated service credit is less than one-half year, or when added 
36.11 	to other service credit with that plan is less than one-half year, the service credit must be 
36.12 	ignored and a refund of contributions made to the person in accord with that plan's refund 
36.13 	provisions.

36.14 	EFFECTIVE DATE. This section is effective July 1, 2018.

36.15 	Sec. 5. [356.311] COVERAGE BY MORE THAN ONE PLAN.
36.16 	() Any person who has been a member of two or more of the retirement plans listed in 
36.17 	paragraph (b) is entitled, when qualified, to an annuity from each fund if:
36.18 	(1) the person's combined service in any two or more retirement plans equals or exceeds 
36.19 	the vesting requirement of the fund with the longest vesting requirement; and
36.20 	(2) the person has not taken a refund from any of the retirement plans.
36.21 	(b) This section applies to any defined benefit plan administered by the Minnesota State 
36.22 	Retirement System, including the State Patrol Retirement Plan; the Public Employees 
36.23 	Retirement Association, including the public employees police and fire plan; the Teachers 
36.24 	Retirement Association; and the St. Paul Teachers Retirement Fund Association, except as 
36.25 	noted in paragraph (c).
36.26 	(c) This section does not apply to plans providing benefits for police officers or 
36.27 	firefighters under sections 424A.091 to 424A.096 or the Bloomington Fire Department 
36.28 	Relief Association.
36.29 	(d) No portion of the service upon which the retirement annuity from one retirement 
36.30 	plan is based shall be again used in the computation of a retirement annuity from another 
36.31 	plan. The annuity from each plan must be determined under the laws applicable to that plan 
36.32 	except that the requirement that a person meet the vesting requirement in any particular 
37.1 	plan shall not apply, provided the combined service in any two or more plans equals or 
37.2 	exceeds the vesting requirement of the plan with the longest vesting requirement.
37.3 	(e) Any deferred annuity payable under this section shall be subject to augmentation 
37.4 	under the laws applicable to the deferred annuity.
37.5 	(f) Any person to whom an annuity is not payable under this section because the person 
37.6 	took a refund from one of the funds shall be entitled to repay the refund in accordance with 
37.7 	the laws governing the refund. Upon repayment, the person is entitled to annuities under 
37.8 	this section, if the person would otherwise be entitled.

37.9 	EFFECTIVE DATE. This section is effective July 1, 2018.

37.10 	Sec. 6. Minnesota Statutes 2016, section 356.415, subdivision 1, is amended to read:
37.11 		Subdivision 1.Annual postretirement adjustments; generally Minnesota State 
37.12 	Retirement System general state employees retirement plan, legislators retirement 
37.13 	plan, and unclassified state employees retirement program. (a) Except as otherwise 
37.14 	provided in subdivision 1a, 1b, 1c, 1d, 1e, or 1f set forth in paragraph (c), recipients of a 
37.15 	retirement annuity, disability benefit, or survivor benefit recipients of a coveredfrom the 
37.16 	general state employees retirement plan, the legislators retirement plan, or the unclassified 
37.17 	state employees retirement program are entitled to aan annual postretirement adjustment 
37.18 	annually on, effective as of each January 1, as follows:
37.19 	(1) effective January 1, 2019, through December 31, 2023, a postretirement increase of 
37.20 	2.5one percent must be applied each year, effective January 1, to the amount of the monthly 
37.21 	annuity or benefit of each annuitant or benefit recipient who has been receiving an annuity 
37.22 	or a benefit for at least 12 full months as of the June 30 of the calendar year immediately 
37.23 	before the adjustment; and
37.24 	(2) effective January 1, 2019, through December 31, 2023, for each annuitant or benefit 
37.25 	recipient who has been receiving an annuity or a benefit amount for at least one full month, 
37.26 	but less than 12 full months as of the June 30 of the calendar year immediately before the 
37.27 	adjustment, an annuala postretirement increase of 1/12 of 2.5one percent for each month 
37.28 	that the person has been receiving an annuity or benefit must be applied. to the amount of 
37.29 	the monthly annuity or benefit of the annuitant or benefit recipient;
37.30 	(3) effective January 1, 2024, and thereafter, a postretirement increase of 1.5 percent 
37.31 	must be applied each year to the amount of the monthly annuity or benefit of each annuitant 
37.32 	or benefit recipient who has been receiving an annuity or a benefit for at least 12 full months 
37.33 	as of the June 30 of the calendar year immediately before the adjustment; and
38.1 	(4) effective January 1, 2024, and thereafter, for each annuitant or benefit recipient who 
38.2 	has been receiving an annuity or a benefit for at least one full month, but less than 12 full 
38.3 	months as of the June 30 of the calendar year immediately before the adjustment, an annual 
38.4 	postretirement increase of 1/12 of 1.5 percent for each month that the person has been 
38.5 	receiving an annuity or benefit must be applied to the amount of the monthly annuity or 
38.6 	benefit of the annuitant or benefit recipient.
38.7 	(b) An increase in annuity or benefit payments under this sectionsubdivision must be 
38.8 	made automatically unless written notice is filed by the annuitant or benefit recipient with 
38.9 	the executive director of the covered retirement plan requesting that the increase not be 
38.10 	made.
38.11 	(c) Members who retire on or after January 1, 2024, under the general state employees 
38.12 	retirement plan, the legislators retirement plan, or the unclassified state employees retirement 
38.13 	program are entitled to an annual postretirement adjustment of the member's retirement 
38.14 	annuity, effective as of each January 1, beginning with the year following the year in which 
38.15 	the member attains normal retirement age, as follows:
38.16 	(1) if a member has been receiving an annuity for at least 12 full months as of the June 
38.17 	30 of the calendar year immediately before the date of the adjustment, a postretirement 
38.18 	increase equal to the percentage specified in paragraph (a), clause (3), must be applied, 
38.19 	effective on January 1, to the amount of the member's monthly annuity;
38.20 	(2) if a member has been receiving an annuity for at least one full month, but less than 
38.21 	12 full months as of the June 30 of the calendar year immediately before the date of 
38.22 	adjustment, a postretirement increase of 1/12 of the percentage specified in paragraph (a), 
38.23 	clause (4), for each month that the member has been receiving an annuity must be applied, 
38.24 	effective on January 1, to the amount of the member's monthly annuity; or
38.25 	(3) if a member has been receiving an annuity for fewer than seven months before the 
38.26 	date of adjustment, a postretirement increase shall not be applied until the next January 1 
38.27 	and the amount of the adjustment shall be the amount determined under clause (2).
38.28 	(d) Paragraph (c) does not apply to members who retire under section 352.116, 
38.29 	subdivision 1, paragraph (c).

38.30 	EFFECTIVE DATE. This section is effective July 1, 2018.

38.31 	Sec. 7. Minnesota Statutes 2016, section 356.415, subdivision 1a, is amended to read:
38.32 		Subd. 1a.Annual postretirement adjustments; Minnesota State Retirement System 
38.33 	plans other than State Patrolcorrectional state employees retirement plan. (a) 
39.1 	Retirement annuity, disability benefit, or survivor benefit recipients of the legislators 
39.2 	retirement plan, including constitutional officers as specified in chapter 3A, the general 
39.3 	state employees retirement plan, the correctional state employees retirement plan, and the 
39.4 	unclassified state employees retirement program are entitled to aan annual postretirement 
39.5 	adjustment annually on, effective as of each January 1, as follows:
39.6 	(1) for each successive January 1, if the definition of funding stability under paragraph 
39.7 	(b) has not been met as of the prior July 1 for or with respect to the applicable retirement 
39.8 	plan, a postretirement increase of two1.5 percent must be applied each year, effective on 
39.9 	January 1, to the monthly annuity or benefit of each annuitant or benefit recipient who has 
39.10 	been receiving an annuity or a benefit for at least 12 full months as of the June 30 of the 
39.11 	calendar year immediately before the adjustment; and
39.12 	(2) for each successive January 1, if the definition of funding stability under paragraph 
39.13 	(b) has not been met as of the prior July 1 for or with respect to the applicable retirement 
39.14 	plan, for each annuitant or benefit recipient who has been receiving an annuity or a benefit 
39.15 	for at least one full month, but less than 12 full months as of the June 30 of the calendar 
39.16 	year immediately before the adjustment, an annual postretirement increase of 1/12 of two
39.17 	1.5 percent for each month that the person has been receiving an annuity or benefit must 
39.18 	be applied to the amount of the monthly annuity or benefit of each annuitant or benefit 
39.19 	recipient.
39.20 	(b) Increases under this subdivision for the general state employees retirement plan or 
39.21 	the correctional state employees retirement plan terminate on December 31 of the calendar 
39.22 	year in which two prior consecutive actuarial valuations prepared by the approved actuary 
39.23 	under sections 356.214 and 356.215 and the standards for actuarial work promulgated by 
39.24 	the Legislative Commission on Pensions and Retirement indicate that the market value of 
39.25 	assets of the retirement plan equals or exceeds 90 percent of the actuarial accrued liability 
39.26 	of the retirement plan and increases under subdivision 1 recommence after that date. Increases 
39.27 	under this subdivision for the legislators retirement plan established under chapter 3A, 
39.28 	including the constitutional officers specified in that chapter, and for the unclassified state 
39.29 	employees retirement program, terminate on December 31 of the calendar year in which 
39.30 	two prior consecutive actuarial valuations prepared by the approved actuary under sections 
39.31 	356.214 and 356.215 and the standards for actuarial work promulgated by the Legislative 
39.32 	Commission on Pensions and Retirement indicate that the market value of assets of the 
39.33 	general state employees retirement plan equals or exceeds 90 percent of the actuarial accrued 
39.34 	liability of the retirement plan and increases under subdivision 1 recommence after that 
39.35 	date.
40.1 	(c) After having met the definition of funding stability under paragraph (b), the increase 
40.2 	provided in paragraph (a), clauses (1) and (2), rather than an increase under subdivision 1, 
40.3 	for the general state employees retirement plan or the correctional state employees retirement 
40.4 	plan, is again to be applied in a subsequent year or years if the market value of assets of the 
40.5 	applicable plan equals or is less than:
40.6 	(1) 85 percent of the actuarial accrued liabilities of the applicable plan for two consecutive 
40.7 	actuarial valuations; or
40.8 	(2) 80 percent of the actuarial accrued liabilities of the applicable plan for the most recent 
40.9 	actuarial valuation.
40.10 	(d) After having met the definition of funding stability under paragraph (b), the increase 
40.11 	provided in paragraph (a), clauses (1) and (2), rather than an increase under subdivision 1, 
40.12 	for the legislators retirement plan, including the constitutional officers, and for the 
40.13 	unclassified state employees retirement program, is again to be applied in a subsequent year 
40.14 	or years if the market value of assets of the general state employees retirement plan equals 
40.15 	or is less than:
40.16 	(1) 85 percent of the actuarial accrued liabilities of the applicable plan for two consecutive 
40.17 	actuarial valuations; or
40.18 	(2) 80 percent of the actuarial accrued liabilities of the applicable plan for the most recent 
40.19 	actuarial valuation.
40.20 	(e)(b) An increase in annuity or benefit payments under this subdivision must be made 
40.21 	automatically unless written notice is filed by the annuitant or benefit recipient with the 
40.22 	executive director of the applicable covered retirement plan requesting that the increase not 
40.23 	be made.

40.24 	EFFECTIVE DATE. This section is effective July 1, 2018.

40.25 	Sec. 8. Minnesota Statutes 2016, section 356.415, subdivision 1b, is amended to read:
40.26 		Subd. 1b.Annual postretirement adjustments; PERA; general employees retirement 
40.27 	plan and local government correctional retirement plan. (a) Retirement annuity, disability 
40.28 	benefit, or survivor benefit recipients ofAnnuities, disability benefits, and survivor benefits 
40.29 	being paid from the general employees retirement plan of the Public Employees Retirement 
40.30 	Association and the local government correctional service retirement plan are entitled to a 
40.31 	postretirement adjustment annually onshall be increased effective each January 1, as follows:
40.32 	by the percentage of increase determined under this subdivision. The increase to the annuity 
40.33 	or benefit shall be determined by multiplying the monthly amount of the annuity or benefit 
41.1 	by the percentage of increase specified in paragraph (b), after taking into account any 
41.2 	reduction to the percentage of increase required under paragraph (c).
41.3 	(1) for each successive January 1 until funding stability is restored for the applicable 
41.4 	retirement plan, a postretirement increase of one percent must be applied each year, effective 
41.5 	on January 1, to the monthly annuity or benefit amount of each annuitant or benefit recipient 
41.6 	who has been receiving an annuity or benefit for at least 12 full months as of the June 30 
41.7 	of the calendar year immediately before the adjustment;
41.8 	(2) for each successive January 1 until funding stability is restored for the applicable 
41.9 	retirement plan, for each annuitant or benefit recipient who has been receiving an annuity 
41.10 	or a benefit for at least one full month, but less than 12 full months as of the June 30 of the 
41.11 	calendar year immediately before the adjustment, an annual postretirement increase of 1/12 
41.12 	of one percent for each month the person has been receiving an annuity or benefit must be 
41.13 	applied;
41.14 	(3) for each January 1 following the restoration of funding stability for the applicable 
41.15 	retirement plan, a postretirement increase of 2.5 percent must be applied each year, effective 
41.16 	January 1, to the monthly annuity or benefit amount of each annuitant or benefit recipient 
41.17 	who has been receiving an annuity or benefit for at least 12 full months as of the June 30 
41.18 	of the calendar year immediately before the adjustment; and
41.19 	(4) for each January 1 following restoration of funding stability for the applicable 
41.20 	retirement plan, for each annuity or benefit recipient who has been receiving an annuity or 
41.21 	a benefit for at least one full month, but less than 12 full months as of the June 30 of the 
41.22 	calendar year immediately before the adjustment, an annual postretirement increase of 1/12 
41.23 	of 2.5 percent for each month the person has been receiving an annuity or benefit must be 
41.24 	applied.
41.25 	(b) Funding stability is restored when the market value of assets of the applicable 
41.26 	retirement plan equals or exceeds 90 percent of the actuarial accrued liabilities of the 
41.27 	applicable plan in the two most recent consecutive actuarial valuations prepared under 
41.28 	section 356.215 and the standards for actuarial work by the approved actuary retained by 
41.29 	the Public Employees Retirement Association under section 356.214.
41.30 	(c) After having met the definition of funding stability under paragraph (b), the increase 
41.31 	provided in paragraph (a), clauses (1) and (2), rather than an increase under subdivision 1, 
41.32 	is again to be applied in a subsequent year or years if the market value of assets of the 
41.33 	applicable plan equals or is less than:
42.1 	(1) 85 percent of the actuarial accrued liabilities of the applicable plan for two consecutive 
42.2 	actuarial valuations; or
42.3 	(2) 80 percent of the actuarial accrued liabilities of the applicable plan for the most recent 
42.4 	actuarial valuation.
42.5 	(b) The percentage of increase shall be one percent unless the federal Social Security 
42.6 	Administration has announced a cost-of-living adjustment pursuant to United States Code, 
42.7 	title 42, section 415(i), in the last quarter of the preceding calendar year that is greater than 
42.8 	two percent. If the cost-of-living adjustment announced by the federal Social Security 
42.9 	Administration is greater than two percent, the percentage of increase shall be 50 percent 
42.10 	of the cost-of-living adjustment announced by the federal Social Security Administration, 
42.11 	but in no event may the percentage of increase exceed 1.5 percent.
42.12 	(c)(1) If the recipient of an annuity, disability benefit, or survivor's benefit has been 
42.13 	receiving the annuity or benefit for at least 12 full months as of the June 30 of the calendar 
42.14 	year immediately before the effective date of the increase, there is no reduction in the 
42.15 	percentage of increase.
42.16 	(2) If the recipient of an annuity, disability benefit, or survivor's benefit has been receiving 
42.17 	the annuity or benefit for at least one month, but less than 12 full months, as of the June 30 
42.18 	of the calendar year immediately preceding the effective date of the increase, the percentage 
42.19 	of increase is multiplied by a fraction, the numerator of which is the number of months the 
42.20 	annuity or benefit was received as of June 30 of the preceding calendar year and the 
42.21 	denominator of which is 12.
42.22 	(d) Effective for members who retire on or after January 1, 2024, annuities shall not be 
42.23 	increased under paragraphs (a) to (c) until January 1 of the year following the year in which 
42.24 	the member reaches normal retirement age. January 1 of the year following the year in 
42.25 	which the member reaches normal retirement age shall be considered the effective date of 
42.26 	the increase under paragraph (c). If a member has been receiving an annuity for fewer than 
42.27 	seven months as of the January 1 of the year following the year in which the member reaches 
42.28 	normal retirement age, no increase shall be paid until January 1 of the next year.
42.29 	(d)(e) An increase in annuity or benefit payments under this section must be made 
42.30 	automatically unless written notice is filed by the annuitant or benefit recipient with the 
42.31 	executive director of the Public Employees Retirement Association requesting that the 
42.32 	increase not be made.
42.33 	(f) Paragraph (d) does not apply to members who retire under section 353.30, subdivision 
42.34 	1a.

43.1 	EFFECTIVE DATE. This section is effective July 1, 2018.

43.2 	Sec. 9. Minnesota Statutes 2016, section 356.415, subdivision 1c, is amended to read:
43.3 		Subd. 1c.Annual postretirement adjustments; PERA-police and fire. (a) Retirement 
43.4 	annuity, disability benefit, or survivor benefit recipients of the public employees police and 
43.5 	fire retirement plan are entitled to aan annual postretirement adjustment annually on, 
43.6 	effective as of each January 1, if the definition of funding stability under paragraph (c) has 
43.7 	not been met, as follows:
43.8 	(1) for each annuitant or benefit recipient whose annuity or benefit effective date is on 
43.9 	or before June 1, 2014, who has been receiving the annuity or benefit for at least 12 full 
43.10 	months as of the immediate preceding June 30, an amount equal to one percent in each year; 
43.11 	or
43.12 	(2) for each annuitant or benefit recipient whose annuity or benefit effective date is on 
43.13 	or before June 1, 2014, who has been receiving the annuity or benefit for at least one full 
43.14 	month, but less than 12 months, as of the immediate preceding June 30, an amount equal 
43.15 	to 1/12 of one percent for each month of annuity or benefit receipt; and
43.16 	(3)(1) for each annuitant or benefit recipient whose annuity or benefit effective date is 
43.17 	after June 1, 2014, who will have been receiving an annuity or benefit for at least 36 full 
43.18 	months as of the immediate preceding June 30, an amount equal toa postretirement increase 
43.19 	of one percent must be applied each year to the amount of the monthly annuity or benefit 
43.20 	of the annuitant or benefit recipient; or
43.21 	(4)(2) for each annuitant or benefit recipient whose annuity or benefit effective date is 
43.22 	after June 1, 2014, who has been receiving the annuity or benefit for at least 25 full months, 
43.23 	but less than 36 months as of the immediate preceding June 30, an amount equal toa 
43.24 	postretirement increase of 1/12 of one percent for each full month ofthat the person has 
43.25 	been receiving an annuity or benefit receipt during the fiscal year in which the annuity or 
43.26 	benefit was effective must be applied each year to the amount of the monthly annuity or 
43.27 	benefit of the annuitant or benefit recipient.
43.28 	(b) Retirement annuity, disability benefit, or survivor benefit recipients of the public 
43.29 	employees police and fire retirement plan are entitled to a postretirement adjustment annually 
43.30 	on each January 1 following the restoration of funding stability as defined under paragraph 
43.31 	(c) and during the continuation of funding stability as defined under paragraph (c), as follows:
44.1 	(1) for each annuitant or benefit recipient who has been receiving the annuity or benefit 
44.2 	for at least 36 full months as of the immediate preceding June 30, an amount equal to 2.5 
44.3 	percent; and
44.4 	(2) for each annuitant or benefit recipient who has been receiving the annuity or benefit 
44.5 	for at least 25 full months, but less than 36 full months, as of the immediate preceding June 
44.6 	30, an amount equal to 1/12 of 2.5 percent for each full month of annuity or benefit receipt 
44.7 	during the fiscal year in which the annuity or benefit was effective.
44.8 	(c) Funding stability is restored when the market value of assets of the public employees 
44.9 	police and fire retirement plan equals or exceeds 90 percent of the actuarial accrued liabilities 
44.10 	of the applicable plan in the two most recent consecutive actuarial valuations prepared under 
44.11 	section 356.215 and under the standards for actuarial work of the Legislative Commission 
44.12 	on Pensions and Retirement by the approved actuary retained by the Public Employees 
44.13 	Retirement Association under section 356.214.
44.14 	(d) After having met the definition of funding stability under paragraph (c), a full or 
44.15 	prorated increase, as provided in paragraph (a), clause (1), (2), (3), or (4), whichever applies, 
44.16 	rather than adjustments under paragraph (b), is again applied in a subsequent year or years 
44.17 	if the market value of assets of the public employees police and fire retirement plan equals 
44.18 	or is less than:
44.19 	(1) 85 percent of the actuarial accrued liabilities of the applicable plan for two consecutive 
44.20 	actuarial valuations; or
44.21 	(2) 80 percent of the actuarial accrued liabilities of the applicable plan for the most recent 
44.22 	actuarial valuation.
44.23 	(e)(b) An increase in annuity or benefit payments under this section must be made 
44.24 	automatically unless written notice is filed by the annuitant or benefit recipient with the 
44.25 	executive director of the Public Employees Retirement Association requesting that the 
44.26 	increase not be made.

44.27 	EFFECTIVE DATE. This section is effective July 1, 2018.

44.28 	Sec. 10. Minnesota Statutes 2016, section 356.415, subdivision 1d, is amended to read:
44.29 		Subd. 1d.Teachers Retirement Association annual postretirement adjustments. (a)
44.30 	Except as set forth in paragraph (d), recipients of a retirement annuity, disability benefit, 
44.31 	or survivor benefit recipients offrom the Teachers Retirement Association are entitled to 
44.32 	aan annual postretirement adjustment annually on, effective as of each January 1, as follows:
45.1 	(1) for eacheffective January 1 until funding stability is restored, 2019, through December 
45.2 	31, 2023, a postretirement increase of twoone percent must be applied each year, effective 
45.3 	on January 1, to the amount of the monthly annuity or benefit amount of each annuitant or 
45.4 	benefit recipient who has been receiving an annuity or a benefit for at least 12 full months 
45.5 	as of the June 30 of the calendar year immediately before the adjustment;
45.6 	(2) for eacheffective January 1 until funding stability is restored, 2019, through December 
45.7 	31, 2023, for each annuitant or benefit recipient who has been receiving an annuity or a 
45.8 	benefit for at least one full month, but less than 12 full months as of the June 30 of the 
45.9 	calendar year immediately before the adjustment, an annuala postretirement increase of 
45.10 	1/12 of twoone percent for each month the person has been receiving an annuity or benefit 
45.11 	must be applied; to the amount of the monthly annuity or benefit of the annuitant or benefit 
45.12 	recipient;
45.13 	(3) for each January 1 following the restoration of funding stability, a postretirement 
45.14 	increase of 2.5 percent must be applied each year, effective January 1, to the monthly annuity 
45.15 	or benefit amount of each annuitant or benefit recipient who has been receiving an annuity 
45.16 	or a benefit for at least 12 full months as of the June 30 of the calendar year immediately 
45.17 	before the adjustment; and
45.18 	(4) for each January 1 following the restoration of funding stability, for each annuitant 
45.19 	or benefit recipient who has been receiving an annuity or a benefit for at least one month, 
45.20 	but less than 12 full months as of the June 30 of the calendar year immediately before the 
45.21 	adjustment, an annual postretirement increase of 1/12 of 2.5 percent for each month the 
45.22 	person has been receiving an annuity or benefit must be applied.
45.23 	(b) Funding stability is restored when the market value of assets of the Teachers 
45.24 	Retirement Association equals or exceeds 90 percent of the actuarial accrued liabilities of 
45.25 	the Teachers Retirement Association in the two most recent prior actuarial valuations 
45.26 	prepared under section 356.215 and the standards for actuarial work by the approved actuary 
45.27 	retained by the Teachers Retirement Association under section 356.214.
45.28 	(c) After having met the definition of funding stability under paragraph (b), the increase 
45.29 	provided in paragraph (a), clauses (1) and (2), rather than an increase under subdivision 1, 
45.30 	or the increase under paragraph (a), clauses (3) and (4), is again to be applied in a subsequent 
45.31 	year or years if the market value of assets of the plan equals or is less than:
45.32 	(1) 85 percent of the actuarial accrued liabilities of the plan for two consecutive actuarial 
45.33 	valuations; or
46.1 	(2) 80 percent of the actuarial accrued liabilities of the plan for the most recent actuarial 
46.2 	valuation.
46.3 	(3) effective January 1, 2024, and thereafter, a postretirement increase must be applied 
46.4 	each year to the amount of the monthly annuity or benefit of each annuitant or benefit 
46.5 	recipient who has been receiving an annuity or a benefit for at least 12 full months as of the 
46.6 	June 30 of the calendar year immediately before the adjustment, at the following rates:

46.7		from January 1, 2024, through December 31, 2024
	1.1 percent
	
46.8		from January 1, 2025, through December 31, 2025
	1.2 percent
	
46.9		from January 1, 2026, through December 31, 2026
	1.3 percent
	
46.10		from January 1, 2027, through December 31, 2027
	1.4 percent
	
46.11		from January 1, 2028, and thereafter
	1.5 percent
	
46.12 	(4) effective January 1, 2024, and thereafter, for each annuitant or benefit recipient who 
46.13 	has been receiving an annuity or a benefit for at least one full month, but less than 12 full 
46.14 	months, as of the June 30 of the calendar year immediately before the adjustment, an annual 
46.15 	postretirement increase of 1/12 of the applicable percentage for each month that the person 
46.16 	has been receiving an annuity or benefit must be applied to the amount of the monthly 
46.17 	annuity or benefit of the annuitant or benefit recipient. The applicable percentages are the 
46.18 	following:

46.19		from January 1, 2024, through December 31, 2024
	1.1 percent
	
46.20		from January 1, 2025, through December 31, 2025
	1.2 percent
	
46.21		from January 1, 2026, through December 31, 2026
	1.3 percent
	
46.22		from January 1, 2027, through December 31, 2027
	1.4 percent
	
46.23		from January 1, 2028, and thereafter
	1.5 percent
	
46.24 	(d) (b) An increase in annuity or benefit payments under this section must be made 
46.25 	automatically unless written notice is filed by the annuitant or benefit recipient with the 
46.26 	executive director of the Teachers Retirement Association requesting that the increase not 
46.27 	be made.
46.28 	(e) (c) The retirement annuity payable to a person who retires before becoming eligible 
46.29 	for Social Security benefits and who has elected the optional payment as provided in section 
46.30 	354.35 must be treated as the sum of a period-certain retirement annuity and a life retirement 
46.31 	annuity for the purposes of any postretirement adjustment. The period-certain retirement 
46.32 	annuity plus the life retirement annuity must be the annuity amount payable until age 62, 
46.33 	65, or normal retirement age, as selected by the member at retirement, for an annuity amount 
46.34 	payable under section 354.35. A postretirement adjustment granted on the period-certain 
46.35 	retirement annuity must terminate when the period-certain retirement annuity terminates.
47.1 	(d) Members who retire on or after July 1, 2024, are entitled to an annual postretirement 
47.2 	adjustment of the member's retirement annuity, effective as of each January 1, beginning 
47.3 	with the year following the year in which the member attains normal retirement age, as 
47.4 	follows:
47.5 	(1) if a member has been receiving an annuity for at least 12 full months as of the June 
47.6 	30 of the calendar year immediately before the date of the adjustment, a postretirement 
47.7 	increase equal to the percentage specified in paragraph (a), clause (3), must be applied, 
47.8 	effective on January 1, to the amount of the member's monthly annuity;
47.9 	(2) if a member has been receiving an annuity for at least one full month, but less than 
47.10 	12 full months as of the June 30 of the calendar year immediately before the date of 
47.11 	adjustment, a postretirement increase of 1/12 of the applicable percentage specified in 
47.12 	paragraph (a), clause (4), for each month that the member has been receiving an annuity 
47.13 	must be applied, effective on January 1, to the amount of the member's monthly annuity; 
47.14 	or
47.15 	(3) if a member has been receiving an annuity for fewer than seven months as of the 
47.16 	January 1 of the year following the year in which the member attains normal retirement 
47.17 	age, a postretirement adjustment shall be applied effective as of the next January 1. The 
47.18 	amount of the adjustment shall be determined under clause (2).
47.19 	(e) Paragraph (d) does not apply to members who retire under section 354.44, subdivision 
47.20 	6, paragraph (c), clause (3), or who retire when the member is at least age 62 and has at 
47.21 	least 30 years of service under section 354.44, subdivision 6, paragraph (c), (d), (e), or (f), 
47.22 	as applicable.

47.23 	EFFECTIVE DATE. This section is effective July 1, 2018.

47.24 	Sec. 11. Minnesota Statutes 2016, section 356.415, subdivision 1e, is amended to read:
47.25 		Subd. 1e.Annual postretirement adjustments; State Patrol retirement plan. (a) 
47.26 	Retirement annuity, disability benefit, or survivor benefit recipients of the State Patrol 
47.27 	retirement plan are entitled to aan annual postretirement adjustment annually on, effective 
47.28 	as of each January 1 if the definition of funding stability under paragraph (b) has not been 
47.29 	met, as follows:
47.30 	(1) a postretirement increase of one percent must be applied each year, effective on 
47.31 	January 1, to the monthly annuity or benefit of each annuitant or benefit recipient who has 
47.32 	been receiving an annuity or a benefit for at least 12 full months as of the June 30 of the 
47.33 	calendar year immediately before the adjustment; and
48.1 	(2) for each annuitant or benefit recipient who has been receiving an annuity or a benefit 
48.2 	for at least one full month, but less than 12 full months as of the June 30 of the calendar 
48.3 	year immediately before the adjustment, an annual postretirement increase of 1/12 of one 
48.4 	percent for each month that the person has been receiving an annuity or benefit must be 
48.5 	applied to the amount of the monthly annuity or benefit of each annuitant or benefit recipient.
48.6 	(b) Increases under paragraph (a) for the State Patrol retirement plan terminate on 
48.7 	December 31 of the calendar year in which two prior consecutive actuarial valuations for 
48.8 	the plan prepared by the approved actuary under sections 356.214 and 356.215 and the 
48.9 	standards for actuarial work promulgated by the Legislative Commission on Pensions and 
48.10 	Retirement indicates that the market value of assets of the retirement plan equals or exceeds 
48.11 	85 percent of the actuarial accrued liability of the retirement plan. Thereafter, increases 
48.12 	under paragraph (a) become effective again on the December 31 of the calendar year in 
48.13 	which the actuarial valuation, or prior consecutive actuarial valuations for the plan prepared 
48.14 	by the approved actuary under sections 356.214 and 356.215 and the standards for actuarial 
48.15 	work promulgated by the Legislative Commission on Pensions and Retirement indicates 
48.16 	that the market value of the assets of the retirement plan equals or is less than 80 percent 
48.17 	of the actuarial accrued liability of the retirement plan for two years, or equals or is less 
48.18 	than 75 percent of the actuarial accrued liability of the retirement plan for one year and 
48.19 	increases under paragraph (c) commence after that date.
48.20 	(c) Retirement annuity, disability benefit, or survivor benefit recipients of the State Patrol 
48.21 	retirement plan are entitled to a postretirement adjustment annually on January 1, as follows:
48.22 	(1) a postretirement increase of 1.5 percent must be applied each year, effective on 
48.23 	January 1, to the monthly annuity or benefit of each annuitant or benefit recipient who has 
48.24 	been receiving an annuity or a benefit for at least 12 full months as of the June 30 of the 
48.25 	calendar year immediately before the adjustment; and
48.26 	(2) for each annuitant or benefit recipient who has been receiving an annuity or a benefit 
48.27 	for at least one full month, but less than 12 full months as of the June 30 of the calendar 
48.28 	year immediately before the adjustment, an annual postretirement increase of 1/12 of 1.5 
48.29 	percent for each month that the person has been receiving an annuity or benefit must be 
48.30 	applied.
48.31 	(d) Increases under paragraph (c) for the State Patrol retirement plan terminate on 
48.32 	December 31 of the calendar year in which two prior consecutive actuarial valuations 
48.33 	prepared by the approved actuary under sections 356.214 and 356.215 and the standards 
48.34 	for actuarial work adopted by the Legislative Commission on Pensions and Retirement 
49.1 	indicates that the market value of assets of the retirement plan equals or exceeds 90 percent 
49.2 	of the actuarial accrued liability of the retirement plan and increases under subdivision 1 
49.3 	recommence after that date.
49.4 	(e)(b) An increase in annuity or benefit payments under this subdivision must be made 
49.5 	automatically unless written notice is filed by the annuitant or benefit recipient with the 
49.6 	executive director of the applicable covered retirement plan requesting that the increase not 
49.7 	be made.

49.8 	EFFECTIVE DATE. This section is effective July 1, 2018.

49.9 	Sec. 12. Minnesota Statutes 2016, section 356.415, subdivision 1f, is amended to read:
49.10 		Subd. 1f.Annual postretirement adjustments; Minnesota State Retirement System 
49.11 	judges retirement plan. (a) The increases provided under this subdivision are in lieu of 
49.12 	increases under subdivision 1 or 1a for retirement annuity, disability benefit, or survivor 
49.13 	benefit recipients of the judges retirement plan.
49.14 	(b)(a) Retirement annuity, disability benefit, or survivor benefit recipients of the judges 
49.15 	retirement plan are entitled to aan annual postretirement adjustment annually on, effective 
49.16 	as of each January 1,if the definition of funding stability under paragraph (b) has not been 
49.17 	met, as follows:
49.18 	(1) a postretirement increase of 1.75 percent must be applied each year, effective on 
49.19 	January 1, to the monthly annuity or benefit of each annuitant or benefit recipient who has 
49.20 	been receiving an annuity or a benefit for at least 12 full months as of the June 30 of the 
49.21 	calendar year immediately before the adjustment; and
49.22 	(2) for each annuitant or benefit recipient who has been receiving an annuity or a benefit 
49.23 	for at least one full month, but less than 12 full months as of the June 30 of the calendar 
49.24 	year immediately before the adjustment, an annual postretirement increase of 1/12 of 1.75 
49.25 	percent for each month that the person has been receiving an annuity or benefit must be 
49.26 	applied to the amount of the monthly annuity or benefit of each annuitant or benefit recipient.
49.27 	(c)(b) Increases under this subdivisionparagraph (a) terminate on December 31 of the 
49.28 	calendar year in which two prior consecutive actuarial valuations prepared by the approved 
49.29 	actuary under sections 356.214 and 356.215 and the standards for actuarial work promulgated 
49.30 	by the Legislative Commission on Pensions and Retirement indicates that the market value 
49.31 	of assets of the judges retirement plan equals or exceeds 70 percent of the actuarial accrued 
49.32 	liability of the retirement plan.and increases under subdivision 1 or 1a, whichever is 
49.33 	applicable,paragraph (c) begin on the January 1 next followingafter that date.
50.1 	(c) Retirement annuity, disability benefit, or survivor benefit recipients of the judges 
50.2 	retirement plan are entitled to a postretirement adjustment annually, effective as of each 
50.3 	January 1 if the definition of funding stability under paragraph (d) has not been met, as 
50.4 	follows:
50.5 	(1) a postretirement increase of two percent must be applied each year to the monthly 
50.6 	annuity or benefit of each annuitant or benefit recipient who has been receiving an annuity 
50.7 	or  a benefit for at least 12 full months as of the June 30 of the calendar year immediately 
50.8 	before the adjustment; and
50.9 	(2) for each annuitant or benefit recipient who has been receiving an annuity or a benefit 
50.10 	for at least one full month, but less than 12 full months as of the June 30 of the calendar 
50.11 	year immediately before the adjustment, an annual postretirement increase of 1/12 of two 
50.12 	percent for each month that the person has been receiving an annuity or benefit must be 
50.13 	applied to the amount of the monthly annuity or benefit of the annuitant or benefit recipient.
50.14 	(d) Increases under paragraph (c) terminate on December 31 of the calendar year in 
50.15 	which two prior consecutive actuarial valuations prepared by the approved actuary under 
50.16 	section 356.214 and the standards for actuarial work promulgated by the Legislative 
50.17 	Commission on Pensions and Retirement indicate that the market value of assets of the 
50.18 	judges retirement plan equals or exceeds 90 percent of the actuarial accrued liability of the 
50.19 	retirement plan and increases under paragraph (e) begin after that date.
50.20 	(e) Retirement annuity, disability benefit, or survivor benefit recipients of the judges 
50.21 	retirement plan are entitled to a postretirement adjustment annually, effective as of each 
50.22 	January 1, as follows:
50.23 	(1) a postretirement increase of 2.5 percent must be applied each year to the monthly 
50.24 	annuity or benefit of each annuitant or benefit recipient who has been receiving an annuity 
50.25 	or a benefit for at least 12 full months as of the June 30 of the calendar year immediately 
50.26 	before the adjustment; and
50.27 	(2) for each annuitant or benefit recipient who has been receiving an annuity or a benefit 
50.28 	for at least one full month, but less than 12 full months as of the June 30 of the calendar 
50.29 	year immediately before the adjustment, an annual postretirement increase of 1/12 of 2.5 
50.30 	percent for each month that the person has been receiving an annuity or benefit must be 
50.31 	applied to the amount of the monthly annuity or benefit of the annuitant or benefit recipient.
50.32 	(d)(f) An increase in annuity or benefit payments under this subdivision must be made 
50.33 	automatically unless written notice is filed by the annuitant or benefit recipient with the 
51.1 	executive director of the applicable covered retirement plan requesting that the increase not 
51.2 	be made.

51.3 	EFFECTIVE DATE. This section is effective July 1, 2018.

51.4 	Sec. 13. Minnesota Statutes 2016, section 356.415, is amended by adding a subdivision 
51.5 	to read:
51.6 		Subd. 1g.Annual postretirement adjustments; PERA local government correctional 
51.7 	retirement plan. (a) Annuities, disability benefits, and survivor benefits being paid from 
51.8 	the local government correctional retirement plan of the Public Employees Retirement 
51.9 	Association shall be increased effective each January 1 by the percentage of increase 
51.10 	determined under this subdivision. The increase to the annuity or benefit shall be determined 
51.11 	by multiplying the monthly amount of the annuity or benefit by the percentage of increase 
51.12 	specified in paragraph (b), after taking into account any reduction to the percentage of 
51.13 	increase required under paragraph (c).
51.14 	(b) The percentage of increase shall be one percent unless the federal Social Security 
51.15 	Administration has announced a cost-of-living adjustment pursuant to United States Code, 
51.16 	title 42, section 415(i), in the last quarter of the preceding calendar year that is greater than 
51.17 	one percent. If the cost-of-living adjustment announced by the federal Social Security 
51.18 	Administration is greater than one percent, the percentage of increase shall be the same as 
51.19 	the cost-of-living adjustment announced by the federal Social Security Administration, but 
51.20 	in no event may the percentage of increase exceed the applicable maximum percentage. 
51.21 	The applicable maximum percentage is 2.5 percent, until either of the following occurs, in 
51.22 	which case the applicable maximum percentage is 1.5 percent and remains at 1.5 percent 
51.23 	thereafter:
51.24 	(1) the market value of assets equals or is less than 85 percent of the actuarial accrued 
51.25 	liabilities as reported by the plan's actuary in two consecutive annual actuarial valuations; 
51.26 	or
51.27 	(2) the market value of assets equals or is less than 80 percent of the actuarial accrued 
51.28 	liabilities as reported by the plan's actuary in the most recent annual actuarial valuation.
51.29 	(c)(1) If the recipient of an annuity, disability benefit, or survivor's benefit has been 
51.30 	receiving the annuity or benefit for at least 12 full months as of the June 30 of the calendar 
51.31 	year immediately before the effective date of the increase, there is no reduction in the 
51.32 	percentage of increase.
52.1 	(2) If the recipient of an annuity, disability benefit, or survivor's benefit has been receiving 
52.2 	the annuity or benefit for at least one month, but less than 12 full months, as of the June 30 
52.3 	of the calendar year immediately preceding the effective date of the increase, the percentage 
52.4 	of increase is multiplied by a fraction, the numerator of which is the number of months the 
52.5 	annuity or benefit was received as of June 30 of the preceding calendar year and the 
52.6 	denominator of which is 12.
52.7 	(d) An increase in annuity or benefit payments under this section must be made 
52.8 	automatically unless written notice is filed by the recipient with the executive director of 
52.9 	the Public Employees Retirement Association requesting that the increase not be made.

52.10 	EFFECTIVE DATE. This section is effective July 1, 2018.

52.11 	Sec. 14. STUDY.
 52.12 	Before December 31, 2020, the Legislative Commission on Pensions and Retirement 
52.13 	must conduct a study of postretirement adjustments for the covered plans as defined in 
52.14 	Minnesota Statutes, section 356.415, subdivision 2, and the St. Paul Teachers Retirement 
52.15 	Fund Association. The study shall take into account the purpose of postretirement adjustments 
52.16 	and whether governing statutes are consistent with the purpose of postretirement adjustments. 
52.17 	The study shall also consider alternative methodologies for determining postretirement 
52.18 	adjustments and evaluate the new methodology to be used by the Public Employees 
52.19 	Retirement Association under this act. The Legislative Commission on Pensions and 
52.20 	Retirement shall report its conclusions based on the study during the 2021 legislative session.

52.21 	EFFECTIVE DATE. This section is effective the day following final enactment.

52.22 	ARTICLE 6
52.23 	INTEREST RATE CONFORMING CHANGES

52.24 	Section 1. Minnesota Statutes 2016, section 3A.03, subdivision 2, is amended to read:
52.25 		Subd. 2.Refund.  (a) A former member who has made contributions under subdivision 
52.26 	1 and who is no longer a member of the legislature is entitled to receive, upon written 
52.27 	application to the executive director on a form prescribed by the executive director, a refund 
52.28 	from the general fund of all contributions credited to the member's account with interest 
52.29 	computed as provided in section 352.22, subdivision 2.
52.30 	(b) The refund of contributions as provided in paragraph (a) terminates all rights of a 
52.31 	former member of the legislature and the survivors of the former member under this chapter.
53.1 	(c) If the former member of the legislature again becomes a member of the legislature 
53.2 	after having taken a refund as provided in paragraph (a), the member is a member of the 
53.3 	unclassified employees retirement program of the Minnesota State Retirement System.
53.4 	(d) However, the member may reinstate the rights and credit for service previously 
53.5 	forfeited under this chapter if the member repays all refunds taken, plus interest at the rate 
53.6 	of 8.5 percent until June 30, 2015, and eight percent thereafterapplicable annual rate or 
53.7 	rates specified in section 356.59, subdivision 2, compounded annually, from the date on 
53.8 	which the refund was taken to the date on which the refund is repaid.
53.9 	(e) A member of the legislature who has received a refund from any of the retirement 
53.10 	plans specified in section 356.311, paragraph (b), may repay the refund to the respective 
53.11 	plan under such terms and conditions consistent with the law governing the retirement plan 
53.12 	if the law governing the plan permits the repayment of refunds. If the total amount to be 
53.13 	repaid, including principal and interest exceeds $2,000, repayment may be made in three 
53.14 	equal installments over a period of 18 months, with the interest accrued during the period 
53.15 	of the repayment added to the final installment.
53.16 	(e)(f) No person may be required to apply for or to accept a refund.

53.17 	EFFECTIVE DATE. This section is effective July 1, 2018.

53.18 	Sec. 2. Minnesota Statutes 2016, section 352.01, subdivision 13a, is amended to read:
53.19 		Subd. 13a.Reduced salary during period of workers' compensation. An employee 
53.20 	on leave of absence receiving temporary workers' compensation payments and a reduced 
53.21 	salary or no salary from the employer who is entitled to allowable service credit for the 
53.22 	period of absence, may make payment to the fund for the difference between salary received, 
53.23 	if any, and the salary the employee would normally receive if not on leave of absence during 
53.24 	the period. The employee shall pay an amount equal to the employee and employer 
53.25 	contribution rate under section 352.04, subdivisions 2 and 3, on the differential salary amount 
53.26 	for the period of the leave of absence.
53.27 	The employing department, at its option, may pay the employer amount on behalf of its 
53.28 	employees. Payment made under this subdivision must include interest at the rate of 8.5 
53.29 	percent until June 30, 2015, and eight percent thereafter per year applicable annual rate or 
53.30 	rates specified in section 356.59, subdivision 2, and must be completed within one year of 
53.31 	the return from leave of absence.

53.32 	EFFECTIVE DATE. This section is effective July 1, 2018.

54.1 	Sec. 3. Minnesota Statutes 2016, section 352.017, subdivision 2, is amended to read:
54.2 		Subd. 2.Purchase procedure. (a) An employee covered by a plan specified in this 
54.3 	chapter may purchase credit for allowable service in that plan for a period specified in 
54.4 	subdivision 1 if the employee makes a payment as specified in paragraph (b) or (c), whichever 
54.5 	applies. The employing unit, at its option, may pay the employer portion of the amount 
54.6 	specified in paragraph (b) on behalf of its employees.
54.7 	(b) If payment is received by the executive director within one year from the date the 
54.8 	employee returned to work following the authorized leave, the payment amount is equal to 
54.9 	the employee and employer contribution rates specified in law for the applicable plan at the 
54.10 	end of the leave period multiplied by the employee's hourly rate of salary on the date of 
54.11 	return from the leave of absence and by the days and months of the leave of absence for 
54.12 	which the employee is eligible for allowable service credit. The payment must include 
54.13 	compound interest at the monthly rate of 0.71 percent until June 30, 2015, and 0.667 percent 
54.14 	per month thereafterapplicable monthly rate or rates specified in section 356.59, subdivision 
54.15 	2, from the last day of the leave period until the last day of the month in which payment is 
54.16 	received. If payment is received by the executive director after one year, the payment amount 
54.17 	is the amount determined under section 356.551. Payment under this paragraph must be 
54.18 	made before the date of termination from public employment covered under this chapter.
54.19 	(c) If the employee terminates employment covered by this chapter during the leave or 
54.20 	following the leave rather than returning to covered employment, payment must be received 
54.21 	by the executive director within 30 days after the termination date. The payment amount is 
54.22 	equal to the employee and employer contribution rates specified in law for the applicable 
54.23 	plan on the day prior to the termination date, multiplied by the employee's hourly rate of 
54.24 	salary on that date and by the days and months of the leave of absence prior to termination.

54.25 	EFFECTIVE DATE. This section is effective July 1, 2018.

54.26 	Sec. 4. Minnesota Statutes 2016, section 352.04, subdivision 8, is amended to read:
54.27 		Subd. 8.Department required to pay omitted salary deductions. (a) If a department 
54.28 	fails to take deductions past due for a period of 60 days or less from an employee's salary 
54.29 	as provided in this section, those deductions must be taken on later payroll abstracts.
54.30 	(b) If a department fails to take deductions past due for a period in excess of 60 days 
54.31 	from an employee's salary as provided in this section, the department, and not the employee, 
54.32 	must pay on later payroll abstracts the employee and employer contributions and an amount 
54.33 	equivalent to 8.5 percent until June 30, 2015, and eight percent thereafter of the total amount 
55.1 	due in lieu of interest, or if the delay in payment exceeds one year, 8.5 percent until June 
55.2 	30, 2015, and eight percent thereafter compound annual interest. at the applicable annual 
55.3 	rate or rates specified in section 356.59, subdivision 2, compounded annually, from the date 
55.4 	the employee and employer contributions should have been deducted to the date payment 
55.5 	of the total amount due is paid by the department.
55.6 	(c) If a department fails to take deductions past due for a period of 60 days or less and 
55.7 	the employee is no longer in state service so that the required deductions cannot be taken 
55.8 	from the salary of the employee, the department must nevertheless pay the required employer 
55.9 	contributions. If any department fails to take deductions past due for a period in excess of 
55.10 	60 days and the employee is no longer in state service, the omitted contributions must be 
55.11 	recovered under paragraph (b).
55.12 	(d) If an employee from whose salary required deductions were past due for a period of 
55.13 	60 days or less leaves state service before the payment of the omitted deductions and 
55.14 	subsequently returns to state service, the unpaid amount is considered the equivalent of a 
55.15 	refund. The employee accrues no right by reason of the unpaid amount, except that the 
55.16 	employee may pay the amount of omitted deductions as provided in section 352.23.

55.17 	EFFECTIVE DATE. This section is effective July 1, 2018.

55.18 	Sec. 5. Minnesota Statutes 2016, section 352.04, subdivision 9, is amended to read:
55.19 		Subd. 9.Erroneous deductions, canceled warrants. (a) Deductions taken from the 
55.20 	salary of an employee for the retirement fund in excess of required amounts must, upon 
55.21 	discovery and verification by the department making the deduction, be refunded to the 
55.22 	employee.
55.23 	(b) If a deduction for the retirement fund is taken from a salary warrant or check, and 
55.24 	the check is canceled or the amount of the warrant or check returned to the funds of the 
55.25 	department making the payment, the sum deducted, or the part of it required to adjust the 
55.26 	deductions, must be refunded to the department or institution if the department applies for 
55.27 	the refund on a form furnished by the director. The department's payments must likewise 
55.28 	be refunded to the department.
55.29 	(c) If erroneous employee deductions and employer contributions are caused by an error 
55.30 	in plan coverage involving the plan and any other plans specified in section 356.99, that 
55.31 	section applies. If the employee should have been covered by the plan governed by chapter 
55.32 	352D, 353D, 354B, or 354D, the employee deductions and employer contributions taken 
55.33 	in error must be directly transferred to the applicable employee's account in the correct 
56.1 	retirement plan, with interest at the rate of 0.71 percent per month until June 30, 2015, and 
56.2 	0.667 percent per month thereafter applicable monthly rate or rates specified in section 
56.3 	356.59, subdivision 2, compounded annually, from the first day of the month following the 
56.4 	month in which coverage should have commenced in the correct defined contribution plan 
56.5 	until the end of the month in which the transfer occurs.

56.6 	EFFECTIVE DATE. This section is effective July 1, 2018.

56.7 	Sec. 6. Minnesota Statutes 2016, section 352.23, is amended to read:
56.8 	352.23 TERMINATION OF RIGHTS; REPAYMENT OF REFUND.
56.9 	(a) When any employee accepts a refund as provided in section 352.22, all existing 
56.10 	allowable service credits and all rights and benefits to which the employee was entitled 
56.11 	before accepting the refund terminate.
56.12 	(b) Terminated service credits and rights must not again be restored until the former 
56.13 	employee acquires at least six months of allowable service credit after taking the last refund. 
56.14 	In that event, the employee may repay all refunds previously taken from the retirement fund.
56.15 	(c) Repayment of refunds entitles the employee only to credit for service covered by (1) 
56.16 	salary deductions; (2) payments previously made in lieu of salary deductions as permitted 
56.17 	under law in effect when the payment in lieu of deductions was made; (3) payments made 
56.18 	to obtain credit for service as permitted by laws in effect when payment was made; and (4) 
56.19 	allowable service previously credited while receiving temporary workers' compensation as 
56.20 	provided in section 352.01, subdivision 11, paragraph (a), clause (3).
56.21 	(d) Payments under this section for repayment of refunds are to be paid with interest at 
56.22 	the rate of 8.5 percent until June 30, 2015, and eight percent thereafterapplicable annual 
56.23 	rate or rates specified in section 356.59, subdivision 2, compounded annually, from the date 
56.24 	the refund was taken until the date the refund is repaid. They may be paid in a lump sum 
56.25 	or by payroll deduction in the manner provided in section 352.04. Payment may be made 
56.26 	in a lump sum up to six months after termination from service.

56.27 	EFFECTIVE DATE. This section is effective July 1, 2018.

56.28 	Sec. 7. Minnesota Statutes 2016, section 352.27, is amended to read:
56.29 	352.27 CREDIT FOR BREAK IN SERVICE TO PROVIDE UNIFORMED 
56.30 	SERVICE.
57.1 	(a) An employee who is absent from employment by reason of service in the uniformed 
57.2 	services, as defined in United States Code, title 38, section 4303(13), and who returns to 
57.3 	state service upon discharge from service in the uniformed service within the time frames 
57.4 	required in United States Code, title 38, section 4312(e), may obtain service credit for the 
57.5 	period of the uniformed service as further specified in this section, provided that the employee 
57.6 	did not separate from uniformed service with a dishonorable or bad conduct discharge or 
57.7 	under other than honorable conditions.
57.8 	(b) The employee may obtain credit by paying into the fund an equivalent employee 
57.9 	contribution based upon the contribution rate or rates in effect at the time that the uniformed 
57.10 	service was performed multiplied by the full and fractional years being purchased and 
57.11 	applied to the annual salary rate. The annual salary rate is the average annual salary during 
57.12 	the purchase period that the employee would have received if the employee had continued 
57.13 	to be employed in covered employment rather than to provide uniformed service, or, if the 
57.14 	determination of that rate is not reasonably certain, the annual salary rate is the employee's 
57.15 	average salary rate during the 12-month period of covered employment rendered immediately 
57.16 	preceding the period of the uniformed service.
57.17 	(c) The equivalent employer contribution and, if applicable, the equivalent additional 
57.18 	employer contribution provided in this chapter must be paid by the department employing 
57.19 	the employee from funds available to the department at the time and in the manner provided 
57.20 	in this chapter, using the employer and additional employer contribution rate or rates in 
57.21 	effect at the time that the uniformed service was performed, applied to the same annual 
57.22 	salary rate or rates used to compute the equivalent employee contribution.
57.23 	(d) If the employee equivalent contributions provided in this section are not paid in full, 
57.24 	the employee's allowable service credit must be prorated by multiplying the full and fractional 
57.25 	number of years of uniformed service eligible for purchase by the ratio obtained by dividing 
57.26 	the total employee contribution received by the total employee contribution otherwise 
57.27 	required under this section.
57.28 	(e) To receive service credit under this section, the contributions specified in this section 
57.29 	must be transmitted to the Minnesota State Retirement System during the period which 
57.30 	begins with the date on which the individual returns to state service and which has a duration 
57.31 	of three times the length of the uniformed service period, but not to exceed five years. If 
57.32 	the determined payment period is less than one year, the contributions required under this 
57.33 	section to receive service credit may be made within one year of the discharge date.
58.1 	(f) The amount of service credit obtainable under this section may not exceed five years 
58.2 	unless a longer purchase period is required under United States Code, title 38, section 4312.
58.3 	(g) The employing unit shall pay interest on all equivalent employee and employer 
58.4 	contribution amounts payable under this section. Interest must be computed at the rate of 
58.5 	8.5 percent until June 30, 2015, and eight percent thereafterat the applicable annual rate or 
58.6 	rates specified in section 356.59, subdivision 2, compounded annually, from the end of each 
58.7 	fiscal year of the leave or the break in service to the end of the month in which the payment 
58.8 	is received.

58.9 	EFFECTIVE DATE. This section is effective July 1, 2018.

58.10 	Sec. 8. Minnesota Statutes 2016, section 352.955, subdivision 3, is amended to read:
58.11 		Subd. 3.Payment of additional equivalent contributions. (a) An eligible employee 
58.12 	who is transferred to plan coverage and who elects to transfer past service credit under this 
58.13 	section must pay an additional member contribution for that prior service period. The 
58.14 	additional member contribution is the amount computed under paragraph (b), plus the greater 
58.15 	of the amount computed under paragraph (c), or 40 percent of the unfunded actuarial accrued 
58.16 	liability attributable to the past service credit transfer.
58.17 	(b) The executive director shall compute, for the most recent 12 months of service credit 
58.18 	eligible for transfer, or for the entire period eligible for transfer if less than 12 months, the 
58.19 	difference between the employee contribution rate or rates for the general state employees 
58.20 	retirement plan and the employee contribution rate or rates for the correctional state 
58.21 	employees retirement plan applied to the eligible employee's salary during that transfer 
58.22 	period, plus compound interest at the applicable monthly rate of 0.71 percent until June 30, 
58.23 	2015, and 0.667 percent per month thereafter or rates specified in section 356.59, subdivision 
58.24 	2.
58.25 	(c) The executive director shall compute, for any service credit being transferred on 
58.26 	behalf of the eligible employee and not included under paragraph (b), the difference between 
58.27 	the employee contribution rate or rates for the general state employees retirement plan and 
58.28 	the employee contribution rate or rates for the correctional state employees retirement plan 
58.29 	applied to the eligible employee's salary during that transfer period, plus compound interest 
58.30 	at the monthly rate of 0.71 percent until June 30, 2015, and 0.667 percent per month thereafter
58.31 	applicable monthly rate or rates specified in section 356.59, subdivision 2.
58.32 	(d) The executive director shall compute an amount using the process specified in 
58.33 	paragraph (b), but based on differences in employer contribution rates between the general 
59.1 	state employees retirement plan and the correctional state employees retirement plan rather 
59.2 	than employee contribution rates.
59.3 	(e) The executive director shall compute an amount using the process specified in 
59.4 	paragraph (c), but based on differences in employer contribution rates between the general 
59.5 	state employees retirement plan and the correctional state employees retirement plan rather 
59.6 	than employee contribution rates.
59.7 	(f) The additional equivalent member contribution under this subdivision must be paid 
59.8 	in a lump sum. Payment must accompany the election to transfer the prior service credit. 
59.9 	No transfer election or additional equivalent member contribution payment may be made 
59.10 	by a person or accepted by the executive director after the one year anniversary date of the 
59.11 	effective date of the retirement coverage transfer, or the date on which the eligible employee 
59.12 	terminates state employment, whichever is earlier.
59.13 	(g) If an eligible employee elects to transfer past service credit under this section and 
59.14 	pays the additional equivalent member contribution amount under paragraph (a), the 
59.15 	applicable department shall pay an additional equivalent employer contribution amount. 
59.16 	The additional employer contribution is the amount computed under paragraph (d), plus the 
59.17 	greater of the amount computed under paragraph (e), or 60 percent of the unfunded actuarial 
59.18 	accrued liability attributable to the past service credit transfer.
59.19 	(h) The unfunded actuarial accrued liability attributable to the past service credit transfer 
59.20 	is the present value of the benefit obtained by the transfer of the service credit to the 
59.21 	correctional state employees retirement plan reduced by the amount of the asset transfer 
59.22 	under subdivision 4, by the amount of the member contribution equivalent payment computed 
59.23 	under paragraph (b), and by the amount of the employer contribution equivalent payment 
59.24 	computed under paragraph (d).
59.25 	(i) The additional equivalent employer contribution under this subdivision must be paid 
59.26 	in a lump sum and must be paid within 30 days of the date on which the executive director 
59.27 	of the Minnesota State Retirement System certifies to the applicable department that the 
59.28 	employee paid the additional equivalent member contribution.

59.29 	EFFECTIVE DATE. This section is effective July 1, 2018.

59.30 	Sec. 9. Minnesota Statutes 2016, section 352B.013, subdivision 2, is amended to read:
59.31 		Subd. 2.Purchase procedure. (a) An employee covered by the plan specified in this 
59.32 	chapter may purchase credit for allowable service in the plan for a period specified in 
59.33 	subdivision 1 if the employee makes a payment as specified in paragraph (b) or (c), whichever 
60.1 	applies. The employing unit, at its option, may pay the employer portion of the amount 
60.2 	specified in paragraph (b) on behalf of its employees.
60.3 	(b) If payment is received by the executive director within one year from the date the 
60.4 	employee returned to work following the authorized leave, the payment amount is equal to 
60.5 	the employee and employer contribution rates specified in section 352B.02 at the end of 
60.6 	the leave period multiplied by the employee's hourly rate of salary on the date of return 
60.7 	from the leave of absence and by the days and months of the leave of absence for which 
60.8 	the employee is eligible for allowable service credit. The payment must include compound 
60.9 	interest at the monthly rate of 0.71 percent until June 30, 2015, and 0.667 percent per month 
60.10 	thereafterapplicable monthly rate or rates specified in section 356.59, subdivision 2, from 
60.11 	the last day of the leave period until the last day of the month in which payment is received. 
60.12 	If payment is received by the executive director after one year from the date the employee 
60.13 	returned to work following the authorized leave, the payment amount is the amount 
60.14 	determined under section 356.551. Payment under this paragraph must be made before the 
60.15 	date of termination from public employment covered under this chapter.
60.16 	(c) If the employee terminates employment covered by this chapter during the leave or 
60.17 	following the leave rather than returning to covered employment, payment must be received 
60.18 	by the executive director within 30 days after the termination date. The payment amount is 
60.19 	equal to the employee and employer contribution rates specified in section 352B.02 on the 
60.20 	day prior to the termination date, multiplied by the employee's hourly rate of salary on that 
60.21 	date and by the days and months of the leave of absence prior to termination.

60.22 	EFFECTIVE DATE. This section is effective July 1, 2018.

60.23 	Sec. 10. Minnesota Statutes 2016, section 352B.085, is amended to read:
60.24 	352B.085 SERVICE CREDIT FOR CERTAIN DISABILITY LEAVES OF 
60.25 	ABSENCE.
60.26 	A member on leave of absence receiving temporary workers' compensation payments 
60.27 	and a reduced salary or no salary from the employer who is entitled to allowable service 
60.28 	credit for the period of absence under section 352B.011, subdivision 3, paragraph (b), may 
60.29 	make payment to the fund for the difference between salary received, if any, and the salary 
60.30 	that the member would normally receive if the member was not on leave of absence during 
60.31 	the period. The member shall pay an amount equal to the member and employer contribution 
60.32 	rate under section 352B.02, subdivisions 1b and 1c, on the differential salary amount for 
60.33 	the period of the leave of absence. The employing department, at its option, may pay the 
60.34 	employer amount on behalf of the member. Payment made under this subdivision must 
61.1 	include interest at the rate of 8.5 percent until June 30, 2015, and eight percent thereafter 
61.2 	per year applicable annual rate or rates specified in section 356.59, subdivision 2, and must 
61.3 	be completed within one year of the member's return from the leave of absence.

61.4 	EFFECTIVE DATE. This section is effective July 1, 2018.

61.5 	Sec. 11. Minnesota Statutes 2016, section 352B.086, is amended to read:
61.6 	352B.086 SERVICE CREDIT FOR UNIFORMED SERVICE.
61.7 	(a) A member who is absent from employment by reason of service in the uniformed 
61.8 	services, as defined in United States Code, title 38, section 4303(13), and who returns to 
61.9 	state employment in a position covered by the plan upon discharge from service in the 
61.10 	uniformed services within the time frame required in United States Code, title 38, section 
61.11 	4312(e), may obtain service credit for the period of the uniformed service, provided that 
61.12 	the member did not separate from uniformed service with a dishonorable or bad conduct 
61.13 	discharge or under other than honorable conditions.
61.14 	(b) The member may obtain credit by paying into the fund an equivalent member 
61.15 	contribution based on the member contribution rate or rates in effect at the time that the 
61.16 	uniformed service was performed multiplied by the full and fractional years being purchased 
61.17 	and applied to the annual salary rate. The annual salary rate is the average annual salary 
61.18 	during the purchase period that the member would have received if the member had continued 
61.19 	to provide employment services to the state rather than to provide uniformed service, or if 
61.20 	the determination of that rate is not reasonably certain, the annual salary rate is the member's 
61.21 	average salary rate during the 12-month period of covered employment rendered immediately 
61.22 	preceding the purchase period.
61.23 	(c) The equivalent employer contribution and, if applicable, the equivalent employer 
61.24 	additional contribution, must be paid by the employing unit, using the employer and employer 
61.25 	additional contribution rate or rates in effect at the time that the uniformed service was 
61.26 	performed, applied to the same annual salary rate or rates used to compute the equivalent 
61.27 	member contribution.
61.28 	(d) If the member equivalent contributions provided for in this section are not paid in 
61.29 	full, the member's allowable service credit must be prorated by multiplying the full and 
61.30 	fractional number of years of uniformed service eligible for purchase by the ratio obtained 
61.31 	by dividing the total member contributions received by the total member contributions 
61.32 	otherwise required under this section.
62.1 	(e) To receive allowable service credit under this section, the contributions specified in 
62.2 	this section must be transmitted to the fund during the period which begins with the date 
62.3 	on which the individual returns to state employment covered by the plan and which has a 
62.4 	duration of three times the length of the uniformed service period, but not to exceed five 
62.5 	years. If the determined payment period is calculated to be less than one year, the 
62.6 	contributions required under this section to receive service credit must be transmitted to the 
62.7 	fund within one year from the discharge date.
62.8 	(f) The amount of allowable service credit obtainable under this section may not exceed 
62.9 	five years, unless a longer purchase period is required under United States Code, title 38, 
62.10 	section 4312.
62.11 	(g) The employing unit shall pay interest on all equivalent member and employer 
62.12 	contribution amounts payable under this section. Interest must be computed at the rate of 
62.13 	8.5 percent until June 30, 2015, and eight percent thereafterapplicable annual rate or rates 
62.14 	specified in section 356.59, subdivision 2, compounded annually, from the end of each 
62.15 	fiscal year of the leave or break in service to the end of the month in which payment is 
62.16 	received.

62.17 	EFFECTIVE DATE. This section is effective July 1, 2018.

62.18 	Sec. 12. Minnesota Statutes 2016, section 352B.11, subdivision 4, is amended to read:
62.19 		Subd. 4.Reentry into state service; refund repayment. (a) When a former member, 
62.20 	who has become separated from state service that entitled the member to membership and 
62.21 	has received a refund of retirement payments, reenters the state service in a position that 
62.22 	entitles the member to membership, that member shall receive credit for the period of prior 
62.23 	allowable state service if the member repays into the fund the amount of the refund, plus 
62.24 	interest on it at the rate of 8.5 percent until June 30, 2015, and eight percent thereafterat 
62.25 	the applicable annual rate or rates specified in section 356.59, subdivision 2, compounded 
62.26 	annually, at any time before subsequent retirement. Repayment may be made in installments 
62.27 	or in a lump sum.
62.28 	(b) A person who has received a refund from the State Patrol retirement fund who is a 
62.29 	member of a public retirement system included in section 356.311 may repay the refund 
62.30 	with interest to the State Patrol retirement fund as provided in paragraph (a).

62.31 	EFFECTIVE DATE. This section is effective July 1, 2018.

63.1 	Sec. 13. Minnesota Statutes 2016, section 352D.05, subdivision 4, is amended to read:
63.2 		Subd. 4.Repayment of refund. (a) A participant in the unclassified program may repay 
63.3 	regular refunds taken under section 352.22, as provided in section 352.23.
63.4 	(b) A participant in the unclassified program or an employee covered by the general 
63.5 	employees retirement plan who has withdrawn the value of the total shares may repay the 
63.6 	refund taken and thereupon restore the service credit, rights and benefits forfeited by paying 
63.7 	into the fund the amount refunded plus interest at the rate of 8.5 percent until June 30, 2015, 
63.8 	and eight percent thereafterapplicable annual rate or rates specified in section 356.59, 
63.9 	subdivision 2, compounded annually, from the date that the refund was taken until the date 
63.10 	that the refund is repaid. If the participant had withdrawn only the employee shares as 
63.11 	permitted under prior laws, repayment must be pro rata.
63.12 	(c) Except as provided in section 356.441, the repayment of a refund under this section 
63.13 	must be made in a lump sum.

63.14 	EFFECTIVE DATE. This section is effective July 1, 2018.

63.15 	Sec. 14. Minnesota Statutes 2016, section 352D.11, subdivision 2, is amended to read:
63.16 		Subd. 2.Payments by employee. An employee entitled to purchase service credit may 
63.17 	make the purchase by paying to the state retirement system an amount equal to the current 
63.18 	employee contribution rate in effect for the state retirement system applied to the current 
63.19 	or final salary rate multiplied by the months and days of prior temporary, intermittent, or 
63.20 	contract legislative service. Payment shall be made in one lump sum unless the executive 
63.21 	director of the state retirement system agrees to accept payment in installments over a period 
63.22 	of not more than three years from the date of the agreement. Installment payments shall be 
63.23 	charged interest at the rate of 8.5 percent until June 30, 2015, and eight percent thereafter
63.24 	applicable annual rate or rates specified in section 356.59, subdivision 2, compounded 
63.25 	annually.

63.26 	EFFECTIVE DATE. This section is effective July 1, 2018.

63.27 	Sec. 15. Minnesota Statutes 2016, section 352D.12, is amended to read:
63.28 	352D.12 TRANSFER OF PRIOR SERVICE CONTRIBUTIONS.
63.29 	(a) An employee who is a participant in the unclassified program and who has prior 
63.30 	service credit in a covered plan under chapter 352, 353, 354, 354A, or 422A may, within 
63.31 	the time limits specified in this section, elect to transfer to the unclassified program prior 
63.32 	service contributions to one or more of those plans.
64.1 	(b) For participants with prior service credit in a plan governed by chapter 352, 353, 
64.2 	354, 354A, or 422A, "prior service contributions" means the accumulated employee and 
64.3 	equal employer contributions with interest at the rate of 8.5 percent until June 30, 2015, 
64.4 	and eight percent thereafterapplicable annual rate or rates specified in section 356.59, 
64.5 	subdivision 2, compounded annually, based on fiscal year balances.
64.6 	(c) If a participant has taken a refund from a retirement plan listed in this section, the 
64.7 	participant may repay the refund to that plan, notwithstanding any restrictions on repayment 
64.8 	to that plan, plus 8.5 percent interest until June 30, 2015, and eight percent interest thereafter
64.9 	with interest at the applicable annual rate or rates specified in section 356.59, subdivision 
64.10 	2, compounded annually, and have the accumulated employee and equal employer 
64.11 	contributions transferred to the unclassified program with interest at the rate of 8.5 percent 
64.12 	until June 30, 2015, and eight percent thereafter compounded annually based on fiscal year 
64.13 	balances. If a person repays a refund and subsequently elects to have the money transferred 
64.14 	to the unclassified program, the repayment amount, including interest, is added to the fiscal 
64.15 	year balance in the year which the repayment was made.
64.16 	(d) A participant electing to transfer prior service contributions credited to a retirement 
64.17 	plan governed by chapter 352, 353, 354, 354A, or 422A as provided under this section must 
64.18 	complete a written application for the transfer and repay any refund within one year of the 
64.19 	commencement of the employee's participation in the unclassified program.

64.20 	EFFECTIVE DATE. This section is effective July 1, 2018.

64.21 	Sec. 16. Minnesota Statutes 2016, section 353.01, subdivision 16, is amended to read:
64.22 		Subd. 16.Allowable service; limits and computation. (a) "Allowable service" means:
64.23 	(1) service during years of actual membership in the course of which employee deductions 
64.24 	were withheld from salary and contributions were made at the applicable rates under section 
64.25 	353.27, 353.65, or 353E.03;
64.26 	(2) periods of service covered by payments in lieu of salary deductions under sections 
64.27 	353.27, subdivisions 12 and 12a, and 353.35;
64.28 	(3) service in years during which the public employee was not a member but for which 
64.29 	the member later elected, while a member, to obtain credit by making payments to the fund 
64.30 	as permitted by any law then in effect;
64.31 	(4) a period of authorized leave of absence during which the employee receives pay as 
64.32 	specified in subdivision 10, paragraph (a), clause (4) or (5), from which deductions for 
64.33 	employee contributions are made, deposited, and credited to the fund;
65.1 	(5) a period of authorized leave of absence without pay, or with pay that is not included 
65.2 	in the definition of salary under subdivision 10, paragraph (a), clause (4) or (5), for which 
65.3 	salary deductions are not authorized, and for which a member obtained service credit for 
65.4 	up to 12 months of the authorized leave period by payment under section 353.0161 or 
65.5 	353.0162, to the fund made in place of salary deductions;
65.6 	(6) a periodic, repetitive leave that is offered to all employees of a governmental 
65.7 	subdivision. The leave program may not exceed 208 hours per annual normal work cycle 
65.8 	as certified to the association by the employer. A participating member obtains service credit 
65.9 	by making employee contributions in an amount or amounts based on the member's average 
65.10 	salary, excluding overtime pay, that would have been paid if the leave had not been taken. 
65.11 	The employer shall pay the employer and additional employer contributions on behalf of 
65.12 	the participating member. The employee and the employer are responsible to pay interest 
65.13 	on their respective shares at the rate of 8.5 percent until June 30, 2015, and eight percent 
65.14 	thereafter applicable rate or rates specified in section 356.59, subdivision 3, compounded 
65.15 	annually, from the end of the normal cycle until full payment is made. An employer shall 
65.16 	also make the employer and additional employer contributions, plus 8.5 percent interest 
65.17 	until June 30, 2015, and eight percent interest thereafter at the applicable rate or rates 
65.18 	specified in section 356.59, subdivision 3, compounded annually, on behalf of an employee 
65.19 	who makes employee contributions but terminates public service. The employee contributions 
65.20 	must be made within one year after the end of the annual normal working cycle or within 
65.21 	30 days after termination of public service, whichever is sooner. The executive director 
65.22 	shall prescribe the manner and forms to be used by a governmental subdivision in 
65.23 	administering a periodic, repetitive leave. Upon payment, the member must be granted 
65.24 	allowable service credit for the purchased period;
65.25 	(7) an authorized temporary or seasonal layoff under subdivision 12, limited to three 
65.26 	months allowable service per authorized temporary or seasonal layoff in one calendar year. 
65.27 	An employee who has received the maximum service credit allowed for an authorized 
65.28 	temporary or seasonal layoff must return to public service and must obtain a minimum of 
65.29 	three months of allowable service subsequent to the layoff in order to receive allowable 
65.30 	service for a subsequent authorized temporary or seasonal layoff;
65.31 	(8) a period during which a member is absent from employment by a governmental 
65.32 	subdivision by reason of service in the uniformed services, as defined in United States Code, 
65.33 	title 38, section 4303(13), if the member returns to public service with the same governmental 
65.34 	subdivision upon discharge from service in the uniformed service within the time frames 
65.35 	required under United States Code, title 38, section 4312(e), provided that the member did 
66.1 	not separate from uniformed service with a dishonorable or bad conduct discharge or under 
66.2 	other than honorable conditions. The service must be credited if the member pays into the 
66.3 	fund equivalent employee contributions based upon the contribution rate or rates in effect 
66.4 	at the time that the uniformed service was performed multiplied by the full and fractional 
66.5 	years being purchased and applied to the annual salary rate. The annual salary rate is the 
66.6 	average annual salary during the purchase period that the member would have received if 
66.7 	the member had continued to be employed in covered employment rather than to provide 
66.8 	uniformed service, or, if the determination of that rate is not reasonably certain, the annual 
66.9 	salary rate is the member's average salary rate during the 12-month period of covered 
66.10 	employment rendered immediately preceding the period of the uniformed service. Payment 
66.11 	of the member equivalent contributions must be made during a period that begins with the 
66.12 	date on which the individual returns to public employment and that is three times the length 
66.13 	of the military leave period, or within five years of the date of discharge from the military 
66.14 	service, whichever is less. If the determined payment period is less than one year, the 
66.15 	contributions required under this clause to receive service credit may be made within one 
66.16 	year of the discharge date. Payment may not be accepted following 30 days after termination 
66.17 	of public service under subdivision 11a. If the member equivalent contributions provided 
66.18 	for in this clause are not paid in full, the member's allowable service credit must be prorated 
66.19 	by multiplying the full and fractional number of years of uniformed service eligible for 
66.20 	purchase by the ratio obtained by dividing the total member contributions received by the 
66.21 	total member contributions otherwise required under this clause. The equivalent employer 
66.22 	contribution, and, if applicable, the equivalent additional employer contribution must be 
66.23 	paid by the governmental subdivision employing the member if the member makes the 
66.24 	equivalent employee contributions. The employer payments must be made from funds 
66.25 	available to the employing unit, using the employer and additional employer contribution 
66.26 	rate or rates in effect at the time that the uniformed service was performed, applied to the 
66.27 	same annual salary rate or rates used to compute the equivalent member contribution. The 
66.28 	governmental subdivision involved may appropriate money for those payments. The amount 
66.29 	of service credit obtainable under this section may not exceed five years unless a longer 
66.30 	purchase period is required under United States Code, title 38, section 4312. The employing 
66.31 	unit shall pay interest on all equivalent member and employer contribution amounts payable 
66.32 	under this clause. Interest must be computed at the rate of 8.5 percent until June 30, 2015, 
66.33 	and eight percent thereafter applicable rate or rates specified in section 356.59, subdivision 
66.34 	3, compounded annually, from the end of each fiscal year of the leave or the break in service 
66.35 	to the end of the month in which the payment is received. Upon payment, the employee 
66.36 	must be granted allowable service credit for the purchased period; or
67.1 	(9) a period specified under section 353.0162.
67.2 	(b) No member may receive more than 12 months of allowable service credit in a year 
67.3 	either for vesting purposes or for benefit calculation purposes.
67.4 	(c) For an active member who was an active member of the former Minneapolis 
67.5 	Firefighters Relief Association on December 29, 2011, "allowable service" is the period of 
67.6 	service credited by the Minneapolis Firefighters Relief Association as reflected in the 
67.7 	transferred records of the association up to December 30, 2011, and the period of service 
67.8 	credited under paragraph (a), clause (1), after December 30, 2011. For an active member 
67.9 	who was an active member of the former Minneapolis Police Relief Association on December 
67.10 	29, 2011, "allowable service" is the period of service credited by the Minneapolis Police 
67.11 	Relief Association as reflected in the transferred records of the association up to December 
67.12 	30, 2011, and the period of service credited under paragraph (a), clause (1), after December 
67.13 	30, 2011.

67.14 	EFFECTIVE DATE. This section is effective July 1, 2018.

67.15 	Sec. 17. Minnesota Statutes 2016, section 353.0162, is amended to read:
67.16 	353.0162 REDUCED SALARY PERIODS SALARY CREDIT PURCHASE.
67.17 	(a) A member may purchase additional salary credit for a period specified in this section.
67.18 	(b) The applicable period is a period during which the member is receiving a reduced 
67.19 	salary from the employer while the member is:
67.20 	(1) receiving temporary workers' compensation payments related to the member's service 
67.21 	to the public employer;
67.22 	(2) on an authorized leave of absence; or
67.23 	(3) on an authorized partial paid leave of absence as a result of a budgetary or salary 
67.24 	savings program offered or mandated by a governmental subdivision.
67.25 	(c) The differential salary amount is the difference between the average monthly salary 
67.26 	received by the member during the period of reduced salary under this section and the 
67.27 	average monthly salary of the member, excluding overtime, on which contributions to the 
67.28 	applicable plan were made during the period of the last six months of covered employment 
67.29 	occurring immediately before the period of reduced salary, applied to the member's normal 
67.30 	employment period, measured in hours or otherwise, as applicable.
67.31 	(d) To receive eligible salary credit, the member shall pay an amount equal to:
68.1 	(1) the applicable employee contribution rate under section 353.27, subdivision 2; 353.65, 
68.2 	subdivision 2; or 353E.03, subdivision 1, as applicable, multiplied by the differential salary 
68.3 	amount;
68.4 	(2) plus an employer equivalent payment equal to the applicable employer contribution 
68.5 	rate in section 353.27, subdivision 3; 353.65, subdivision 3; or 353E.03, subdivision 2, as 
68.6 	applicable, multiplied by the differential salary amount;
68.7 	(3) plus, if applicable, an equivalent employer additional amount equal to the additional 
68.8 	employer contribution rate in section 353.27, subdivision 3a, multiplied by the differential 
68.9 	salary amount.
68.10 	(e) The employer, by appropriate action of its governing body and documented in its 
68.11 	official records, may pay the employer equivalent contributions and, as applicable, the 
68.12 	equivalent employer additional contributions on behalf of the member.
68.13 	(f) Payment under this section must include interest on the contribution amount or 
68.14 	amounts, whichever applies, at an 8.5 percent annual rate until June 30, 2015, and at an 
68.15 	eight percent annual rate thereafter the applicable rate or rates specified in section 356.59, 
68.16 	subdivision 3, compounded annually, prorated for applicablethe number of months, if less 
68.17 	than 12 months, from the date on which the period of reduced salary specified under this 
68.18 	section terminates to the date on which the payment or payments are received by the 
68.19 	executive director. Payment under this section must be completed within the earlier of 30 
68.20 	days from termination of public service by the employee under section 353.01, subdivision 
68.21 	11a, or one year after the termination of the period specified in paragraph (b), as further 
68.22 	restricted under this section.
68.23 	(g) The period for which additional allowable salary credit may be purchased is limited 
68.24 	to the period during which the person receives temporary workers' compensation payments 
68.25 	or for those business years in which the governmental subdivision offers or mandates a 
68.26 	budget or salary savings program, as certified to the executive director by a resolution of 
68.27 	the governing body of the governmental subdivision. For an authorized leave of absence, 
68.28 	the period for which allowable salary credit may be purchased may not exceed 12 months 
68.29 	of authorized leave.
68.30 	(h) To purchase salary credit for a subsequent period of temporary workers' compensation 
68.31 	benefits or subsequent authorized medical leave of absence, the member must return to 
68.32 	public service and render a minimum of three months of allowable service.

68.33 	EFFECTIVE DATE. This section is effective July 1, 2018.

69.1 	Sec. 18. Minnesota Statutes 2017 Supplement, section 353.27, subdivision 3c, is amended 
69.2 	to read:
69.3 		Subd. 3c.Former MERF members; member and employer contributions. (a) For 
69.4 	the period July 1, 2015, through December 31, 2031, the member contributions for former 
69.5 	members of the Minneapolis Employees Retirement Fund and by the former Minneapolis 
69.6 	Employees Retirement Fund-covered employing units are governed by this subdivision.
69.7 	(b) The member contribution for a public employee who was a member of the former 
69.8 	Minneapolis Employees Retirement Fund on June 29, 2010, is 9.75 percent of the salary of 
69.9 	the employee.
69.10 	(c) The employer regular contribution with respect to a public employee who was a 
69.11 	member of the former Minneapolis Employees Retirement Fund on June 29, 2010, is 9.75 
69.12 	percent of the salary of the employee.
69.13 	(d) The annual employer supplemental contribution is the employing unit's share of 
69.14 	$31,000,000. For calendar years 2017 and 2018, the employer supplemental contribution 
69.15 	is the employing unit's share of $21,000,000.
69.16 	(e) Each employing unit's share under paragraph (d) is the amount determined from an 
69.17 	allocation between each employing unit in the portion equal to the unit's employer 
69.18 	supplemental contribution paid or payable under Minnesota Statutes 2012, section 353.50, 
69.19 	during calendar year 2014.
69.20 	(f) The employer supplemental contribution amount under paragraph (d) for calendar 
69.21 	year 2015 must be invoiced by the executive director of the Public Employees Retirement 
69.22 	Association by July 1, 2015. The calendar year 2015 payment is payable in a single amount 
69.23 	on or before September 30, 2015. For subsequent calendar years, the employer supplemental 
69.24 	contribution under paragraph (d) must be invoiced on January 31 of each year and is payable 
69.25 	in two parts, with the first half payable on or before July 31 and with the second half payable 
69.26 	on or before December 15. Late payments are payable with compound interest, compounded 
69.27 	annually, at the rate of 0.71 percentapplicable rate or rates specified in section 356.59, 
69.28 	subdivision 3, per month for each month or portion of a month that has elapsed after the 
69.29 	due date.
69.30 	(g) The employer supplemental contribution under paragraph (d) terminates on December 
69.31 	31, 2031.

69.32 	EFFECTIVE DATE. This section is effective July 1, 2018.

70.1 	Sec. 19. Minnesota Statutes 2016, section 353.27, subdivision 7a, is amended to read:
70.2 		Subd. 7a.Deductions or contributions transmitted by error. (a) If employee deductions 
70.3 	and employer contributions under this section, section 353.50, 353.65, or 353E.03 were 
70.4 	erroneously transmitted to the association, but should have been transmitted to a plan covered 
70.5 	by chapter 352D, 353D, 354B, or 354D, the executive director shall transfer the erroneous 
70.6 	employee deductions and employer contributions to the appropriate retirement fund or 
70.7 	individual account, as applicable. The time limitations specified in subdivisions 7 and 12 
70.8 	do not apply. The transfer to the applicable defined contribution plan account must include 
70.9 	interest at the rate of 0.71 percent per month until June 30, 2015, and 0.667 percentapplicable 
70.10 	rate or rates specified in section 356.59, subdivision 3, per month thereafter, compounded 
70.11 	annually, from the first day of the month following the month in which coverage should 
70.12 	have commenced in the defined contribution plan until the end of the month in which the 
70.13 	transfer occurs.
70.14 	(b) A potential transfer under paragraph (a) that is reasonably determined to cause the 
70.15 	plan to fail to be a qualified plan under section 401(a) of the federal Internal Revenue Code, 
70.16 	as amended, must not be made by the executive director of the association. Within 30 days 
70.17 	after being notified by the Public Employees Retirement Association of an unmade potential 
70.18 	transfer under this paragraph, the employer of the affected person must transmit an amount 
70.19 	representing the applicable salary deductions and employer contributions, without interest, 
70.20 	to the retirement fund of the appropriate Minnesota public pension plan, or to the applicable 
70.21 	individual account if the proper coverage is by a defined contribution plan. The association 
70.22 	must provide the employing unit a credit for the amount of the erroneous salary deductions 
70.23 	and employer contributions against future contributions from the employer. If the employing 
70.24 	unit receives a credit under this paragraph, the employing unit is responsible for refunding 
70.25 	to the applicable employee any amount that had been erroneously deducted from the person's 
70.26 	salary.
70.27 	(c) If erroneous employee deductions and employer contributions reflect a plan coverage 
70.28 	error involving any Public Employees Retirement Association plan specified in section 
70.29 	356.99 and any other plan specified in that section, section 356.99 applies.

70.30 	EFFECTIVE DATE. This section is effective July 1, 2018.

70.31 	Sec. 20. Minnesota Statutes 2016, section 353.27, subdivision 12, is amended to read:
70.32 		Subd. 12.Omitted salary deductions; obligations. (a) In the case of omission of 
70.33 	required deductions for the general employees retirement plan, the public employees police 
70.34 	and fire retirement plan, or the local government correctional employees retirement plan 
71.1 	from the salary of an employee, the department head or designee shall immediately, upon 
71.2 	discovery, report the employee for membership and deduct the employee deductions under 
71.3 	subdivision 4 during the current pay period or during the pay period immediately following 
71.4 	the discovery of the omission. Payment for the omitted obligations may only be made in 
71.5 	accordance with reporting procedures and methods established by the executive director.
71.6 	(b) When the entire omission period of an employee does not exceed 60 days, the 
71.7 	governmental subdivision may report and submit payment of the omitted employee 
71.8 	deductions and the omitted employer contributions through the reporting processes under 
71.9 	subdivision 4.
71.10 	(c) When the omission period of an employee exceeds 60 days, the governmental 
71.11 	subdivision shall furnish to the association sufficient data and documentation upon which 
71.12 	the obligation for omitted employee and employer contributions can be calculated. The 
71.13 	omitted employee deductions must be deducted from the employee's subsequent salary 
71.14 	payment or payments and remitted to the association for deposit in the applicable retirement 
71.15 	fund. The employee shall pay omitted employee deductions due for the 60 days prior to the 
71.16 	end of the last pay period in the omission period during which salary was earned. The 
71.17 	employer shall pay any remaining omitted employee deductions and any omitted employer 
71.18 	contributions, plus cumulative interest at the annual rate of 8.5 percent until June 30, 2015, 
71.19 	and eight percent thereafter compounded annually, from the date or dates each omitted 
71.20 	employee contribution was first payable.
71.21 	(d) An employer shall not hold an employee liable for omitted employee deductions 
71.22 	beyond the pay period dates under paragraph (c), nor attempt to recover from the employee 
71.23 	those employee deductions paid by the employer on behalf of the employee. Omitted 
71.24 	deductions due under paragraph (c) which are not paid by the employee constitute a liability 
71.25 	of the employer that failed to deduct the omitted deductions from the employee's salary. 
71.26 	The employer shall make payment with interest at the annual rate of 8.5 percent until June 
71.27 	30, 2015, and eight percent thereafterapplicable rate or rates specified in section 356.59, 
71.28 	subdivision 3, compounded annually. Omitted employee deductions are no longer due if an 
71.29 	employee terminates public service before making payment of omitted employee deductions 
71.30 	to the association, but the employer remains liable to pay omitted employer contributions 
71.31 	plus interest at the annual rate of 8.5 percent until June 30, 2015, and eight percent thereafter
71.32 	applicable rate or rates specified in section 356.59, subdivision 3, compounded annually,
71.33 	from the date the contributions were first payable.
71.34 	(e) The association may not commence action for the recovery of omitted employee 
71.35 	deductions and employer contributions after the expiration of three calendar years after the 
72.1 	calendar year in which the contributions and deductions were omitted. Except as provided 
72.2 	under paragraph (b), no payment may be made or accepted unless the association has already 
72.3 	commenced action for recovery of omitted deductions. An action for recovery commences 
72.4 	on the date of the mailing of any written correspondence from the association requesting 
72.5 	information from the governmental subdivision upon which to determine whether or not 
72.6 	omitted deductions occurred.

72.7 	EFFECTIVE DATE. This section is effective July 1, 2018.

72.8 	Sec. 21. Minnesota Statutes 2016, section 353.27, subdivision 12a, is amended to read:
72.9 		Subd. 12a.Terminated employees: omitted deductions. A terminated employee who 
72.10 	was a member of the general employees retirement plan of the Public Employees Retirement 
72.11 	Association, the public employees police and fire retirement plan, or the local government 
72.12 	correctional employees retirement plan and who has a period of employment in which 
72.13 	previously omitted employer contributions were made under subdivision 12 but for whom 
72.14 	no, or only partial, omitted employee contributions have been made, or a member who had 
72.15 	prior coverage in the association for which previously omitted employer contributions were 
72.16 	made under subdivision 12 but who terminated service before required omitted employee 
72.17 	deductions could be withheld from salary, may pay the omitted employee deductions for 
72.18 	the period on which omitted employer contributions were previously paid plus interest at 
72.19 	the annual rate of 8.5 percent until June 30, 2015, and eight percent thereafterapplicable 
72.20 	rate or rates specified in section 356.59, subdivision 3, compounded annually. A terminated 
72.21 	employee may pay the omitted employee deductions plus interest within six months of an 
72.22 	initial notification from the association of eligibility to pay those omitted deductions. If a 
72.23 	terminated employee is reemployed in a position covered under a public pension fund under 
72.24 	section 356.30, subdivision 3, and elects to pay omitted employee deductions, payment 
72.25 	must be made no later than six months after a subsequent termination of public service.

72.26 	EFFECTIVE DATE. This section is effective July 1, 2018.

72.27 	Sec. 22. Minnesota Statutes 2016, section 353.27, subdivision 12b, is amended to read:
72.28 		Subd. 12b.Terminated employees: immediate eligibility. If deductions were omitted 
72.29 	from salary adjustments or final salary of a terminated employee who was a member of the 
72.30 	general employees retirement plan, the public employees police and fire retirement plan, 
72.31 	or the local government correctional employees retirement plan and who is immediately 
72.32 	eligible to draw a monthly benefit, the employer shall pay the omitted employer and employer 
72.33 	additional contributions plus interest on both the employer and employee amounts due at 
73.1 	an annual rate of 8.5 percentthe applicable rate or rates specified in section 356.59, 
73.2 	subdivision 3, compounded annually. The employee shall pay the employee deductions 
73.3 	within six months of an initial notification from the association of eligibility to pay omitted 
73.4 	deductions or the employee forfeits the right to make the payment.

73.5 	EFFECTIVE DATE. This section is effective July 1, 2018.

73.6 	Sec. 23. Minnesota Statutes 2016, section 353.28, subdivision 5, is amended to read:
73.7 		Subd. 5.Interest chargeable on amounts due. Any amount due under this section or 
73.8 	section 353.27, subdivision 4, is payable with interest at the annual compound rate of 8.5 
73.9 	percent until June 30, 2015, and eight percent thereafterapplicable rate or rates specified 
73.10 	in section 356.59, subdivision 3, compounded annually, from the date due until the date 
73.11 	payment is received by the association, with a minimum interest charge of $10.

73.12 	EFFECTIVE DATE. This section is effective July 1, 2018.

73.13 	Sec. 24. Minnesota Statutes 2016, section 353.35, subdivision 1, is amended to read:
73.14 		Subdivision 1.Refund rights. (a) Except as provided in paragraph (b), when any former 
73.15 	member accepts a refund, all existing service credits and all rights and benefits to which 
73.16 	the person was entitled prior to the acceptance of the refund must terminate.
73.17 	(b) A refund under section 353.651, subdivision 3, paragraph (c), does not result in a 
73.18 	forfeiture of salary credit for the allowable service credit covered by the refund.
73.19 	(c) The rights and benefits of a former member must not be restored until the person 
73.20 	returns to active service and acquires at least six months of allowable service credit after 
73.21 	taking the last refund and repays the refund or refunds taken and interest received under 
73.22 	section 353.34, subdivisions 1 and 2, plus interest at the annual rate of 8.5 percent until June 
73.23 	30, 2015, and eight percent thereafterapplicable rate or rates specified in section 356.59, 
73.24 	subdivision 3, compounded annually. If the person elects to restore service credit in a 
73.25 	particular fund from which the person has taken more than one refund, the person must 
73.26 	repay all refunds to that fund. All refunds must be repaid within six months of the last date 
73.27 	of termination of public service.

73.28 	EFFECTIVE DATE. This section is effective July 1, 2018.

73.29 	Sec. 25. Minnesota Statutes 2016, section 354.50, subdivision 2, is amended to read:
73.30 		Subd. 2.Interest charge. If a member desires to repay the refunds, payment shall include 
73.31 	interest at an annual rate of 8.5 percentthe applicable annual rate or rates specified in section 
74.1 	356.59, subdivision 4, compounded annually, from date of withdrawal to the date payment 
74.2 	is made and shall be credited to the fund.

74.3 	EFFECTIVE DATE. This section is effective July 1, 2018.

74.4 	Sec. 26. Minnesota Statutes 2016, section 354.51, subdivision 5, is amended to read:
74.5 		Subd. 5.Payment of shortages. (a) Except as provided in paragraph (b), in the event 
74.6 	that full required member contributions are not deducted from the salary of a teacher, 
74.7 	payment of shortages in member deductions on salary earned are the sole obligation of the 
74.8 	employing unit and are payable by the employing unit upon notification by the executive 
74.9 	director of the shortage. The amount of the shortage shall be paid with interest at an annual 
74.10 	rate of 8.5 percentthe applicable annual rate or rates specified in section 356.59, subdivision 
74.11 	4, compounded annually, from the end of the fiscal year in which the shortage occurred to 
74.12 	the end of the month in which payment is made and the interest must be credited to the 
74.13 	fund. The employing unit shall also pay the employer contributions as specified in section 
74.14 	354.42, subdivisions 3 and 5 for the shortages. If the shortage payment is not paid by the 
74.15 	employing unit within 60 days of notification, and if the executive director does not use the 
74.16 	recovery procedure in section 354.512, the executive director shall certify the amount of 
74.17 	the shortage to the applicable county auditor, who shall spread a levy in the amount of the 
74.18 	shortage payment over the taxable property of the taxing district of the employing unit if 
74.19 	the employing unit is supported by property taxes. Payment may not be made for shortages 
74.20 	in member deductions on salary paid or payable under paragraph (b) or for shortages in 
74.21 	member deductions for persons employed by the Minnesota State Colleges and Universities 
74.22 	system in a faculty position or in an eligible unclassified administrative position and whose 
74.23 	employment was less than 25 percent of a full academic year, exclusive of the summer 
74.24 	session, for the applicable institution that exceeds the most recent 36 months.
74.25 	(b) For a person who is employed by the Minnesota State Colleges and Universities 
74.26 	system in a faculty position or in an eligible unclassified administrative position and whose 
74.27 	employment was less than 25 percent of a full academic year, exclusive of the summer 
74.28 	session, for the applicable institution, upon the person's election under section 354B.21 of 
74.29 	retirement coverage under this chapter, the shortage in member deductions on the salary 
74.30 	for employment by the Minnesota State Colleges and Universities system institution of less 
74.31 	than 25 percent of a full academic year, exclusive of the summer session, for the applicable 
74.32 	institution for the most recent 36 months and the associated employer contributions must 
74.33 	be paid by the Minnesota State Colleges and Universities system institution, plus annual 
74.34 	compound interest at the rate of 8.5 percentapplicable annual rate or rates specified in 
75.1 	section 356.59, subdivision 4, compounded annually, from the end of the fiscal year in 
75.2 	which the shortage occurred to the end of the month in which the Teachers Retirement 
75.3 	Association coverage election is made. An individual electing coverage under this paragraph 
75.4 	shall repay the amount of the shortage in member deductions, plus interest, through deduction 
75.5 	from salary or compensation payments within the first year of employment after the election 
75.6 	under section 354B.21, subject to the limitations in section 16D.16. The Minnesota State 
75.7 	Colleges and Universities system may use any means available to recover amounts which 
75.8 	were not recovered through deductions from salary or compensation payments. No payment 
75.9 	of the shortage in member deductions under this paragraph may be made for a period longer 
75.10 	than the most recent 36 months.

75.11 	EFFECTIVE DATE. This section is effective July 1, 2018.

75.12 	Sec. 27. Minnesota Statutes 2016, section 354.52, subdivision 4, is amended to read:
75.13 		Subd. 4.Reporting and remittance requirements. An employer shall remit all amounts 
75.14 	due to the association and furnish a statement indicating the amount due and transmitted 
75.15 	with any other information required by the executive director. If an amount due is not 
75.16 	received by the association within 14 calendar days of the payroll warrant, the amount 
75.17 	accrues interest at an annual rate of 8.5 percentemployer shall pay interest on the amount 
75.18 	due at the applicable annual rate or rates specified in section 356.59, subdivision 4, 
75.19 	compounded annually, from the due date until the amount is received by the association. 
75.20 	All amounts due and other employer obligations not remitted within 60 days of notification 
75.21 	by the association must be certified to the commissioner of management and budget who 
75.22 	shall deduct the amount from any state aid or appropriation amount applicable to the 
75.23 	employing unit.

75.24 	EFFECTIVE DATE. This section is effective July 1, 2018.

75.25 	Sec. 28. Minnesota Statutes 2016, section 354.53, subdivision 5, is amended to read:
75.26 		Subd. 5.Interest requirements. The employer shall pay interest on all equivalent 
75.27 	employee and employer contribution amounts payable under this section. Interest must be 
75.28 	computed at a rate of 8.5 percentat the applicable annual rate or rates specified in section 
75.29 	356.59, subdivision 4, compounded annually, from the end of each fiscal year of the leave 
75.30 	or the break in service to the end of the month in which the payment is received.

75.31 	EFFECTIVE DATE. This section is effective July 1, 2018.

76.1 	Sec. 29. Minnesota Statutes 2016, section 354.72, subdivision 2, is amended to read:
76.2 		Subd. 2.Purchase procedure. (a) A teacher may purchase credit for allowable and 
76.3 	formula service in the plan for a period specified in subdivision 1 if the teacher makes a 
76.4 	payment as specified in paragraph (b), (c), or (d), whichever applies. The employing unit, 
76.5 	at its option, may pay the employer portion of the amount on behalf of its employees.
76.6 	(b) If payment is received by the executive director by June 30 of the fiscal year of the 
76.7 	strike period or by December 31 of the fiscal year following an authorized leave included 
76.8 	under section 354.093, 354.095, or 354.096, payment must equal the total employee and 
76.9 	employer contribution rates, including amortization contribution rates if applicable, multiplied 
76.10 	by the member's average monthly salary rate on the date the leave or strike period 
76.11 	commenced, multiplied by the months and portions of a month of the leave or strike period 
76.12 	for which the teacher seeks allowable service credit. This paragraph also applies to an 
76.13 	extended leave under section 354.094, except that payment must be received by June 30 of 
76.14 	the year of the leave, and the salary used in the computation is the salary received during 
76.15 	the year immediately preceding the initial year of the leave.
76.16 	(c) If payment is made after June 30 and before the following June 30 for a strike period, 
76.17 	or after December 31 of the fiscal year following a leave of absence under section 354.093, 
76.18 	354.095, or 354.096, and before July 1, the payment must include the amount determined 
76.19 	in paragraph (b) plus compound interest at a monthly rate of 0.71 percent from June 30 for 
76.20 	a strike period, or from December 31 for a leave under section 354.093, 354.095, or 354.096, 
76.21 	until the last day of the month in which payment is received. If payment is made on or after 
76.22 	July 1 and before the following July 1 for an extended leave of absence under section 
76.23 	354.094, the payment must include the amount determined in paragraph (b) plus compound 
76.24 	interest at a monthly rate of 0.71 percent the applicable annual rate or rates specified in 
76.25 	section 356.59, subdivision 4, from June 30 until the last day of the month in which payment 
76.26 	is received.
76.27 	(d) If payment is received by the executive director after the applicable last permitted 
76.28 	date under paragraph (c), the payment amount is the amount determined under section 
76.29 	356.551. Notwithstanding payment deadlines specified in section 356.551, payment under 
76.30 	this section may be made anytime before the effective date of retirement.

76.31 	EFFECTIVE DATE. This section is effective July 1, 2018.

77.1 	Sec. 30. Minnesota Statutes 2016, section 354A.093, subdivision 6, is amended to read:
77.2 		Subd. 6.Interest requirements. The employer shall pay interest on all equivalent 
77.3 	employee and employer contribution amounts payable under this section. Interest must be 
77.4 	computed at the rate of 8.5 percent until June 30, 2015, and eight percent thereafterapplicable 
77.5 	annual rate or rates specified in section 356.59, subdivision 5, compounded annually, from 
77.6 	the end of each fiscal year of the leave or break in service to the end of the month in which 
77.7 	payment is received.

77.8 	EFFECTIVE DATE. This section is effective July 1, 2018.

77.9 	Sec. 31. Minnesota Statutes 2016, section 354A.096, is amended to read:
77.10 	354A.096 MEDICAL LEAVE.
77.11 	Any teacher in the coordinated program of the St. Paul Teachers Retirement Fund 
77.12 	Association who is on an authorized medical leave of absence and subsequently returns to 
77.13 	teaching service is entitled to receive allowable service credit, not to exceed one year, for 
77.14 	the period of leave, upon making the prescribed payment to the fund. This payment must 
77.15 	include the required employee and employer contributions at the rates specified in section 
77.16 	354A.12, subdivisions 1 and 2a, as applied to the member's average full-time monthly salary 
77.17 	rate on the date the leave of absence commenced plus annual interest at the rate of 8.5 
77.18 	percent until June 30, 2015, and eight percent thereafter per yearapplicable annual rate or 
77.19 	rates specified in section 356.59, subdivision 5, compounded annually, from the end of the 
77.20 	fiscal year during which the leave terminates to the end of the month during which payment 
77.21 	is made. The member must pay the total amount required unless the employing unit, at its 
77.22 	option, pays the employer contributions. The total amount required must be paid by the end 
77.23 	of the fiscal year following the fiscal year in which the leave of absence terminated or before 
77.24 	the member retires, whichever is earlier. Payment must be accompanied by a copy of the 
77.25 	resolution or action of the employing authority granting the leave and the employing 
77.26 	authority, upon granting the leave, must certify the leave to the association in a manner 
77.27 	specified by the executive director. A member may not receive more than one year of 
77.28 	allowable service credit during any fiscal year by making payment under this section. A 
77.29 	member may not receive disability benefits under section 354A.36 and receive allowable 
77.30 	service credit under this section for the same period of time.

77.31 	EFFECTIVE DATE. This section is effective July 1, 2018.

78.1 	Sec. 32. Minnesota Statutes 2016, section 354A.12, subdivision 1a, is amended to read:
78.2 		Subd. 1a.Obligation for omitted salary deductions. If the full required contributions 
78.3 	are not deducted from the salary of a teacher, payment of the shortage in such deductions 
78.4 	is the sole obligation of the employing unit during the three-year period following the end 
78.5 	of the fiscal year in which the shortage occurred. The shortage is payable by the employing 
78.6 	unit upon notification of the shortage by the executive director of the applicable retirement 
78.7 	fund association. The employing unit shall also pay any employer contributions related to 
78.8 	the shortage. The amount of the shortage in employee contributions and associated employer 
78.9 	contributions is payable with interest at the preretirement interest assumption for the 
78.10 	retirement fund as specified in section 356.215, subdivision 8, stated as a monthly rate
78.11 	applicable annual rate or rates specified in section 356.59, subdivision 5, from the date due 
78.12 	until the date payment is received in the office of the association, compounded annually, 
78.13 	with a minimum interest charge of $10. If the shortage payment and interest is not paid by 
78.14 	the employing unit within 60 days of notification, the executive director shall certify the 
78.15 	amount of the shortage payment and interest to the commissioner of management and budget, 
78.16 	who shall deduct the amount from any state aid or appropriation amount applicable to the 
78.17 	employing unit.

78.18 	EFFECTIVE DATE. This section is effective July 1, 2018.

78.19 	Sec. 33. Minnesota Statutes 2016, section 354A.12, subdivision 7, is amended to read:
78.20 		Subd. 7.Recovery of benefit overpayments. (a) If the executive director discovers, 
78.21 	within the time period specified in subdivision 8 following the payment of a refund or the 
78.22 	accrual date of any retirement annuity, survivor benefit, or disability benefit, that benefit 
78.23 	overpayment has occurred due to using invalid service or salary, or due to any erroneous 
78.24 	calculation procedure, the executive director must recalculate the annuity or benefit payable 
78.25 	and recover any overpayment. The executive director shall recover the overpayment by 
78.26 	requiring direct repayment or by suspending or reducing the payment of a retirement annuity 
78.27 	or other benefit payable under this chapter to the applicable person or the person's estate, 
78.28 	whichever applies, until all outstanding amounts have been recovered. If a benefit 
78.29 	overpayment or improper payment of benefits occurred caused by a failure of the person 
78.30 	to satisfy length of separation requirements for retirement under section 354A.011, 
78.31 	subdivision 21, the executive director shall recover the improper payments by requiring 
78.32 	direct repayment. The repayment must include interest at the rate of 0.71 percent per month
78.33 	applicable annual rate or rates specified in section 356.59, subdivision 5, from the first of 
79.1 	the month in which a monthly benefit amount was paid to the first of the month in which 
79.2 	the amount is repaid, with annual compounding.
79.3 	(b) In the event the executive director determines that an overpaid annuity or benefit 
79.4 	that is the result of invalid salary included in the average salary used to calculate the payment 
79.5 	amount must be recovered, the executive director must determine the amount of the employee 
79.6 	deductions taken in error on the invalid salary, with interest as determined under 354A.37, 
79.7 	subdivision 3, and must subtract that amount from the total annuity or benefit overpayment, 
79.8 	and the remaining balance of the overpaid annuity or benefit, if any, must be recovered.
79.9 	(c) If the invalid employee deductions plus interest exceed the amount of the overpaid 
79.10 	benefits, the balance must be refunded to the person to whom the benefit or annuity is being 
79.11 	paid.
79.12 	(d) Any invalid employer contributions reported on the invalid salary must be credited 
79.13 	against future contributions payable by the employer.
79.14 	(e) If a member or former member, who is receiving a retirement annuity or disability 
79.15 	benefit for which an overpayment is being recovered, dies before recovery of the overpayment 
79.16 	is completed and an optional annuity or refund is payable, the remaining balance of the 
79.17 	overpaid annuity or benefit must continue to be recovered from the payment to the optional 
79.18 	annuity beneficiary or refund recipient.
79.19 	(f) The board of trustees shall adopt policies directing the period of time and manner 
79.20 	for the collection of any overpaid retirement or optional annuity, and survivor or disability 
79.21 	benefit, or a refund that the executive director determines must be recovered as provided 
79.22 	under this section.

79.23 	EFFECTIVE DATE. This section is effective July 1, 2018.

79.24 	Sec. 34. Minnesota Statutes 2016, section 354A.34, is amended to read:
79.25 	354A.34 DISPOSITION OF UNPAID PERIOD CERTAIN FOR LIFE OR 
79.26 	GUARANTEED REFUND OPTIONAL ANNUITIES.
79.27 	If a retiree from a coordinated program who has elected a period certain and for life 
79.28 	thereafter or a guaranteed refund optional annuity form dies without having a designated 
79.29 	beneficiary who has survived the retiree, any remaining unpaid guaranteed annuity payments 
79.30 	shall be computed at the rate of interest specified in section 356.215, subdivision 8, and 
79.31 	paid in one lump sum to the estate of the retiree. If a retiree from a coordinated program 
79.32 	who has elected a period certain and for life or a guaranteed refund optional annuity form 
79.33 	dies with a designated beneficiary who has survived the retiree but the designated beneficiary 
80.1 	dies without there existing another designated beneficiary, any remaining unpaid guaranteed 
80.2 	annuity payments shall be computed at the rate ofwith interest at the applicable annual rate 
80.3 	or rates specified in section 356.215, subdivision 8 356.59, subdivision 5, and paid in one 
80.4 	lump sum to the estate of the designated beneficiary.

80.5 	EFFECTIVE DATE. This section is effective July 1, 2018.

80.6 	Sec. 35. Minnesota Statutes 2016, section 356.195, subdivision 2, is amended to read:
80.7 		Subd. 2.Purchase procedure for strike periods. (a) An employee covered by a plan 
80.8 	specified in subdivision 1 may purchase allowable service credit in the applicable plan for 
80.9 	any period of time during which the employee was on a public employee strike without 
80.10 	pay, not to exceed a period of one year, if the employee makes a payment in lieu of salary 
80.11 	deductions as specified in paragraph (b) or (c), whichever applies. The employing unit, at 
80.12 	its option, may pay the employer portion of the amount specified in paragraph (b) on behalf 
80.13 	of its employees.
80.14 	(b) If payment is received by the applicable pension plan executive director within one 
80.15 	year from the end of the strike, the payment amount is equal to the applicable employee 
80.16 	and employer contribution rates specified in law for the applicable plan during the strike 
80.17 	period, applied to the employee's rate of salary in effect at the conclusion of the strike for 
80.18 	the period of the strike without pay, plus compound interest at the monthly rate of 0.71 
80.19 	percent for any period for the Teachers Retirement Association and at the monthly rate of 
80.20 	0.71 percent until June 30, 2015, and 0.667 percent thereafter for any other retirement plan 
80.21 	listed in section 356.30, subdivision 3 applicable monthly rate or rates specified in section 
80.22 	356.59, subdivision 2, 3, 4, or 5, whichever applies, from the last day of the strike period 
80.23 	until the date payment is received.
80.24 	(c) If payment is received by the applicable pension fund director after one year and 
80.25 	before five years from the end of the strike, the payment amount is the amount determined 
80.26 	under section 356.551.
80.27 	(d) Payments may not be made more than five years after the end of the strike.

80.28 	EFFECTIVE DATE. This section is effective July 1, 2018.

80.29 	Sec. 36. Minnesota Statutes 2016, section 356.44, is amended to read:
80.30 	356.44 PARTIAL PAYMENT OF PENSION PLAN REFUND.
80.31 	(a) Notwithstanding any provision of law to the contrary, a member of a pension plan 
80.32 	listed in section 356.30, subdivision 3, with at least two years of forfeited service taken 
81.1 	from a single pension plan, may repay a portion of all refunds. A partial refund repayment 
81.2 	must comply with this section.
81.3 	(b) The minimum portion of a refund repayment is one-third of the total service credit 
81.4 	period of all refunds taken from a single plan.
81.5 	(c) The cost of the partial refund repayment is the product of the cost of the total 
81.6 	repayment multiplied by the ratio of the restored service credit to the total forfeited service 
81.7 	credit. The total repayment amount includes interest at the annual rate of 8.5 percent for 
81.8 	any period for the Teachers Retirement Association and is 8.5 percent until June 30, 2015, 
81.9 	and eight percent thereafter for any other retirement plan listed in section 356.30, subdivision 
81.10 	3 applicable annual rate or rates specified in section 356.59, subdivision 2, 3, 4, or 5, 
81.11 	whichever applies, compounded annually, from the refund date to the date repayment is 
81.12 	received.
81.13 	(d) The restored service credit must be allocated based on the relationship the restored 
81.14 	service bears to the total service credit period for all refunds taken from a single pension 
81.15 	plan.
81.16 	(e) This section does not authorize a public pension plan member to repay a refund if 
81.17 	the law governing the plan does not authorize the repayment of a refund of member 
81.18 	contributions.

81.19 	EFFECTIVE DATE. This section is effective July 1, 2018.

81.20 	Sec. 37. Minnesota Statutes 2016, section 356.50, subdivision 2, is amended to read:
81.21 		Subd. 2.Service credit procedure.  (a) To obtain the public pension plan allowable 
81.22 	service credit, the eligible person under subdivision 1 shall pay the required member 
81.23 	contribution amount. The required member contribution amount is the member contribution 
81.24 	rate or rates in effect for the pension plan during the period of service covered by the back 
81.25 	pay award, applied to the unpaid gross salary amounts of the back pay award including 
81.26 	unemployment insurance, workers' compensation, or wages from other sources which 
81.27 	reduced the back award. No contributions may be made under this clause for compensation 
81.28 	covered by a public pension plan listed in section 356.30, subdivision 3, for employment 
81.29 	during the removal period. The person shall pay the required member contribution amount 
81.30 	within 60 days of the date of receipt of the back pay award or within 60 days of a billing 
81.31 	from the retirement fund, whichever is later.
81.32 	(b) The public employer who wrongfully discharged the public employee must pay an 
81.33 	employer contribution on the back pay award. The employer contribution must be based 
82.1 	on the employer contribution rate or rates in effect for the pension plan during the period 
82.2 	of service covered by the back pay award, applied to the salary amount on which the member 
82.3 	contribution amount was determined under paragraph (a). Interest on both the required 
82.4 	member and employer contribution amount must be paid by the employer at the annual 
82.5 	compound rate of 8.5 percent for any period for the Teachers Retirement Association and 
82.6 	8.5 percent until June 30, 2015, and eight percent thereafter, for any other retirement plan 
82.7 	listed in section 356.30, subdivision 3, per year, expressed monthly The employer must pay 
82.8 	compound interest on both the required member and employer contribution amounts at the 
82.9 	applicable monthly rate or rates specified in section 356.59, subdivision 2, 3, 4, or 5, 
82.10 	whichever applies, between the date the contribution amount would have been paid to the 
82.11 	date of actual payment. The employer payment must be made within 30 days of the payment 
82.12 	under paragraph (a).

82.13 	EFFECTIVE DATE. This section is effective July 1, 2018.

82.14 	Sec. 38. Minnesota Statutes 2016, section 356.551, subdivision 2, is amended to read:
82.15 		Subd. 2.Determination. (a) Unless the minimum purchase amount set forth in paragraph 
82.16 	(c) applies, the prior service credit purchase amount is an amount equal to the actuarial 
82.17 	present value, on the date of payment, as calculated by the chief administrative officer of 
82.18 	the pension plan and reviewed by the actuary retained under section 356.214, of the amount 
82.19 	of the additional retirement annuity obtained by the acquisition of the additional service 
82.20 	credit in this section.
82.21 	(b) Calculation of this amount must be made using the preretirement interest rate 
82.22 	applicable to the public pension plan specified in section 356.215, subdivision 8, and the 
82.23 	mortality table adopted for the public pension plan. The calculation must assume continuous 
82.24 	future service in the public pension plan until, and retirement at, the age at which the 
82.25 	minimum requirements of the fund for normal retirement or retirement with an annuity 
82.26 	unreduced for retirement at an early age, including section 356.30, are met with the additional 
82.27 	service credit purchased. The calculation must also assume a full-time equivalent salary, or 
82.28 	actual salary, whichever is greater, and a future salary history that includes annual salary 
82.29 	increases at the applicable salary increase rate for the plan specified in section 356.215, 
82.30 	subdivision 4d 8.
82.31 	(c) The prior service credit purchase amount may not be less than the amount determined 
82.32 	by applying, for each year or fraction of a year being purchased, the sum of the employee 
82.33 	contribution rate, the employer contribution rate, and the additional employer contribution 
82.34 	rate, if any, applicable during that period, to the person's annual salary during that period, 
83.1 	or fractional portion of a year's salary, if applicable, plus interest at the annual rate of 8.5 
83.2 	percent until June 30, 2015, and eight percent thereafterapplicable annual rate or rates 
83.3 	specified in section 356.59, subdivision 2, 3, 4, or 5, whichever applies, compounded 
83.4 	annually, from the end of the year in which contributions would otherwise have been made 
83.5 	to the date on which the payment is received.
83.6 	(d) Unless otherwise provided by statutes governing a specific plan, payment must be 
83.7 	made in one lump sum within one year of the prior service credit authorization or prior to 
83.8 	the member's effective date of retirement, whichever is earlier. Payment of the amount 
83.9 	calculated under this section must be made by the applicable eligible person.
83.10 	(e) However, the current employer or the prior employer may, at its discretion, pay all 
83.11 	or any portion of the payment amount that exceeds an amount equal to the employee 
83.12 	contribution rates in effect during the period or periods of prior service applied to the actual 
83.13 	salary rates in effect during the period or periods of prior service, plus interest at the 
83.14 	applicable annual rate of 8.5 percent a year or rates specified in section 356.59, subdivision 
83.15 	2, 3, 4, or 5, whichever applies, compounded annually, from the date on which the 
83.16 	contributions would otherwise have been made to the date on which the payment is made. 
83.17 	If the employer agrees to payments under this subdivision, the purchaser must make the 
83.18 	employee payments required under this subdivision within 90 days of the prior service credit 
83.19 	authorization. If that employee payment is made, the employer payment under this 
83.20 	subdivision must be remitted to the chief administrative officer of the public pension plan 
83.21 	within 60 days of receipt by the chief administrative officer of the employee payments 
83.22 	specified under this subdivision.

83.23 	EFFECTIVE DATE. This section is effective July 1, 2018.

83.24 	Sec. 39. [356.59] INTEREST RATES.
83.25 		Subdivision 1.Applicable interest rates. Whenever the payment of interest is required 
83.26 	with respect to any payment, including refunds, remittances, shortages, contributions, or 
83.27 	repayments, the rate of interest is the rate or rates specified in subdivisions 2 to 5 for each 
83.28 	public retirement plan.
83.29 		Subd. 2.Minnesota State Retirement System. The interest rates for all retirement plans 
83.30 	administered by the Minnesota State Retirement System are as follows:

83.31				Annual
		Monthly
	
83.32		before July 1, 2015
	8.5 percent
	0.71 percent
	
83.33		from July 1, 2015, to June 30, 2018
	8.0 percent
	0.667 percent
	
83.34		after June 30, 2018
	7.5 percent
	0.625 percent
	
84.1 		Subd. 3.Public Employees Retirement Association. The interest rates for all retirement 
84.2 	plans administered by the Public Employees Retirement Association are as follows:

84.3		before July 1, 2015
	8.5 percent
		
84.4		from July 1, 2015, to June 30, 2018
	8.0 percent
		
84.5		after June 30, 2018
	7.5 percent
		
84.6 		Subd. 4.Teachers Retirement Association. The interest rates for the retirement plan 
84.7 	administered by the Teachers Retirement Association are as follows:

84.8				Annual
		Monthly
	
84.9		before July 1, 2018
	8.5 percent
	0.71 percent
	
84.10		after June 30, 2018
	7.5 percent
	0.625 percent
	
84.11 		Subd. 5.St. Paul Teachers Retirement Fund Association. The interest rates for the 
84.12 	retirement plan administered by the St. Paul Teachers Retirement Fund Association are as 
84.13 	follows:

84.14				Annual
		Monthly
	
84.15		before July 1, 2015
	8.5 percent
	0.71 percent
	
84.16		from July 1, 2015, to June 30, 2018
	8.0 percent
	0.667 percent
	
84.17		after June 30, 2018
	7.5 percent
	0.625 percent

84.18 	EFFECTIVE DATE. This section is effective July 1, 2018.

84.19 	Sec. 40. Minnesota Statutes 2016, section 490.121, subdivision 4, is amended to read:
84.20 		Subd. 4.Allowable service. (a) "Allowable service" means any calendar month, subject 
84.21 	to the service credit limit in subdivision 22, served as a judge at any time, during which the 
84.22 	judge received compensation for that service from the state, municipality, or county, 
84.23 	whichever applies, and for which the judge made any required member contribution. It also 
84.24 	includes any month served as a referee in probate for all referees in probate who were in 
84.25 	office before January 1, 1974.
84.26 	(b) "Allowable service" also means a period of authorized leave of absence for which 
84.27 	the judge has made a payment in lieu of contributions, not in an amount in excess of the 
84.28 	service credit limit under subdivision 22. To obtain the service credit, the judge shall pay 
84.29 	an amount equal to the normal cost of the judges retirement plan on the date of return from 
84.30 	the leave of absence, as determined in the most recent actuarial report for the plan filed with 
84.31 	the Legislative Commission on Pensions and Retirement, multiplied by the judge's average 
84.32 	monthly salary rate during the authorized leave of absence and multiplied by the number 
84.33 	of months of the authorized leave of absence, plus annual compound interest at the rate of 
85.1 	8.5 percent until June 30, 2015, and eight percent thereafterinterest at the applicable annual 
85.2 	rate or rates specified in section 356.59, subdivision 2, compounded annually, from the date 
85.3 	of the termination of the leave to the date on which payment is made. The payment must 
85.4 	be made within one year of the date on which the authorized leave of absence terminated. 
85.5 	Service credit for an authorized leave of absence is in addition to a uniformed service leave 
85.6 	under section 490.1211.
85.7 	(c) "Allowable service" does not mean service as a retired judge.

85.8 	EFFECTIVE DATE. This section is effective July 1, 2018.

85.9 	Sec. 41. Minnesota Statutes 2016, section 490.1211, is amended to read:
85.10 	490.1211 UNIFORMED SERVICE.
85.11 	(a) A judge who is absent from employment by reason of service in the uniformed 
85.12 	services, as defined in United States Code, title 38, section 4303(13), and who returns to 
85.13 	state employment as a judge upon discharge from service in the uniformed service within 
85.14 	the time frame required in United States Code, title 38, section 4312(e), may obtain service 
85.15 	credit for the period of the uniformed service, provided that the judge did not separate from 
85.16 	uniformed service with a dishonorable or bad conduct discharge or under other than honorable 
85.17 	conditions.
85.18 	(b) The judge may obtain credit by paying into the fund equivalent member contribution 
85.19 	based on the contribution rate or rates in effect at the time that the uniformed service was 
85.20 	performed multiplied by the full and fractional years being purchased and applied to the 
85.21 	annual salary rate. The annual salary rate is the average annual salary during the purchase 
85.22 	period that the judge would have received if the judge had continued to provide employment 
85.23 	services to the state rather than to provide uniformed service, or if the determination of that 
85.24 	rate is not reasonably certain, the annual salary rate is the judge's average salary rate during 
85.25 	the 12-month period of judicial employment rendered immediately preceding the purchase 
85.26 	period.
85.27 	(c) The equivalent employer contribution and, if applicable, the equivalent employer 
85.28 	additional contribution, must be paid by the employing unit, using the employer and employer 
85.29 	additional contribution rate or rates in effect at the time that the uniformed service was 
85.30 	performed, applied to the same annual salary rate or rates used to compute the equivalent 
85.31 	member contribution.
85.32 	(d) If the member equivalent contributions provided for in this section are not paid in 
85.33 	full, the judge's allowable service credit must be prorated by multiplying the full and 
86.1 	fractional number of years of uniformed service eligible for purchase by the ratio obtained 
86.2 	by dividing the total member contributions received by the total member contributions 
86.3 	otherwise required under this section.
86.4 	(e) To receive allowable service credit under this section, the contributions specified in 
86.5 	this section and section 490.121 must be transmitted to the fund during the period which 
86.6 	begins with the date on which the individual returns to judicial employment and which has 
86.7 	a duration of three times the length of the uniformed service period, but not to exceed five 
86.8 	years. If the determined payment period is calculated to be less than one year, the 
86.9 	contributions required under this section to receive service credit may be within one year 
86.10 	from the discharge date.
86.11 	(f) The amount of allowable service credit obtainable under this section and section 
86.12 	490.121 may not exceed five years, unless a longer purchase period is required under United 
86.13 	States Code, title 38, section 4312.
86.14 	(g) The state court administrator shall pay interest on all equivalent member and employer 
86.15 	contribution amounts payable under this section. Interest must be computed at the rate of 
86.16 	8.5 percent until June 30, 2015, and eight percent thereafterat the applicable annual rate or 
86.17 	rates specified in section 356.59, subdivision 2, compounded annually, from the end of each 
86.18 	fiscal year of the leave or break in service to the end of the month in which payment is 
86.19 	received.

86.20 	EFFECTIVE DATE. This section is effective July 1, 2018.

86.21 	Sec. 42. Minnesota Statutes 2016, section 490.124, subdivision 12, is amended to read:
86.22 		Subd. 12.Refund.  (a) A person who ceases to be a judge is entitled to a refund in an 
86.23 	amount that is equal to all of the member's employee contributions to the judges' retirement 
86.24 	fund plus interest computed under section 352.22, subdivision 2.
86.25 	(b) A refund of contributions under paragraph (a) terminates all service credits and all 
86.26 	rights and benefits of the judge and the judge's survivors under this chapter.
86.27 	(c) A person who becomes a judge again after taking a refund under paragraph (a) may 
86.28 	reinstate the previously terminated allowable service credit, rights, and benefits by repaying 
86.29 	the total amount of the previously received refund. The refund repayment must include 
86.30 	interest on the total amount previously received at the annual rate of 8.5 percent until June 
86.31 	30, 2015, and eight percent thereafter at the applicable annual rate or rates specified in 
86.32 	section 356.59, subdivision 2, compounded annually, from the date on which the refund 
86.33 	was received until the date on which the refund is repaid.

87.1 	EFFECTIVE DATE. This section is effective July 1, 2018.

87.2 	ARTICLE 7
87.3 	CONTRIBUTION RATES

87.4 	Section 1. Minnesota Statutes 2016, section 352.04, subdivision 2, is amended to read:
87.5 		Subd. 2.Employee contributions. (a) The employee contribution to the fund must be 
87.6 	equal to the following percent of salary:

87.7		from July 1, 2010, to June 30, 2014
	5
	
87.8		from July 1, 2014, and thereafter to June 30, 2018
	5.5
	
87.9		from July 1, 2018, to June 30, 2019
	5.75
	
87.10		after June 30, 2019
	6
	
87.11 	(b) These contributions must be made by deduction from salary as provided in subdivision 
87.12 	4.
87.13 	(c) Contribution increases under paragraph (a) must be paid starting the first day of the 
87.14 	first full pay period after the effective date of the increase.

87.15 	EFFECTIVE DATE. This section is effective July 1, 2018.

87.16 	Sec. 2. Minnesota Statutes 2016, section 352.04, subdivision 3, is amended to read:
87.17 		Subd. 3.Employer contributions. (a) The employer contribution to the fund must be 
87.18 	equal to the following percent of salary:

87.19		from July 1, 2010, to June 30, 2014
	5
	
87.20		from July 1, 2014, and thereafterto June 30, 2018
	5.5
	
87.21		from July 1, 2018, to June 30, 2019
	5.875
	
87.22		after June 30, 2019
	6.25
	
87.23 	(b) Contribution increases under paragraph (a) must be paid starting the first day of the 
87.24 	first full pay period after the effective date of the increase.

87.25 	EFFECTIVE DATE. This section is effective July 1, 2018.

87.26 	Sec. 3. Minnesota Statutes 2016, section 352.92, subdivision 1, is amended to read:
87.27 		Subdivision 1.Employee contributions. (a) Employee contributions of covered 
87.28 	correctional employees must be in an amount equal to the following percent of salary:

87.29		from July 1, 2010, to June 30, 2014
	8.6
	
87.30		from July 1, 2014, and thereafterto June 30, 2018
	9.1
	
88.1		after June 30, 2018
	9.6
	
88.2 	(b) These contributions must be made by deduction from salary as provided in section 
88.3 	352.04, subdivision 4.
88.4 	(c) Contribution increases under paragraph (a) must be paid starting the first day of the 
88.5 	first full pay period after the effective date of the increase.

88.6 	EFFECTIVE DATE. This section is effective July 1, 2018.

88.7 	Sec. 4. Minnesota Statutes 2016, section 352.92, subdivision 2, is amended to read:
88.8 		Subd. 2.Employer contributions. (a) The employer shall contribute for covered 
88.9 	correctional employees an amount equal to the following percent of salary:

88.10		from July 1, 2010, to June 30, 2014
	12.1
	
88.11		from July 1, 2014, and thereafterto June 30, 2018
	12.85
	
88.12		after June 30, 2018
	14.4
	
88.13 	(b) Contribution increases under paragraph (a) must be paid starting the first day of the 
88.14 	first full pay period after the effective date of the increase.

88.15 	EFFECTIVE DATE. This section is effective July 1, 2018.

88.16 	Sec. 5. Minnesota Statutes 2016, section 352.92, is amended by adding a subdivision to 
88.17 	read:
88.18 		Subd. 2a.Supplemental employer contribution. (a) Effective July 1, 2019, the employer 
88.19 	shall pay a supplemental contribution. The supplemental contribution is 1.45 percent of 
88.20 	salary for covered correctional employees from July 1, 2019, through June 30, 2020; 2.95 
88.21 	percent of salary for covered correctional employees from July 1, 2020, through June 30, 
88.22 	2021; and 4.45 percent of salary for covered correctional employees thereafter. The 
88.23 	supplemental contribution rate of 4.45 percent remains in effect until the market value of 
88.24 	the assets of the correctional state employees retirement plan of the Minnesota State 
88.25 	Retirement System equals or exceeds the actuarial accrued liability of the plan as determined 
88.26 	by the actuary retained under section 356.214. The expiration of the supplemental employer 
88.27 	contribution is effective the first day of the first full pay period of the fiscal year immediately 
88.28 	following the issuance of the actuarial valuation upon which the expiration is based.
88.29 	(b) The supplemental contribution under paragraph (a) must be paid starting the first 
88.30 	day of the first full pay period after the effective date of this subdivision.

88.31 	EFFECTIVE DATE. This section is effective July 1, 2018.

89.1 	Sec. 6. Minnesota Statutes 2016, section 352B.02, subdivision 1a, is amended to read:
89.2 		Subd. 1a.Member contributions. (a) The member contribution is the following 
89.3 	percentage of the member's salary:

89.4
89.5		(1) before the first day of the first pay period beginning 
after July 1,  2014
	12.4 percent
	
89.6
89.7		(2) on or after the first day of the first pay period 
beginning afterfrom July 1, 2014, to June 30, 2016
	13.4 percent
	
89.8
89.9		(3) after June 30, 2016 from July 1, 2016, to June 30, 
2018
	14.4 percent
	
89.10		from July 1, 2018, to June 30, 2020
	14.9
	
89.11		after June 30, 2020
	15.4
	
89.12 	(b) These contributions must be made by deduction from salary as provided in section 
89.13 	352.04, subdivision 4.
89.14 	(c) Contribution increases under paragraph (a) must be paid starting the first day of the 
89.15 	first full pay period after the effective date of the increase.

89.16 	EFFECTIVE DATE. This section is effective July 1, 2018.

89.17 	Sec. 7. Minnesota Statutes 2016, section 352B.02, subdivision 1c, is amended to read:
89.18 		Subd. 1c.Employer contributions and supplemental employer contribution. (a) In 
89.19 	addition to member contributions, department heads shall pay a sum equal to the specified 
89.20 	percentage of the salary upon which deductions were made, which constitutes the employer 
89.21 	contribution to the fund as follows:

89.22
89.23		(1) before the first day of the first pay period beginning 
after July 1,  2014
	18.6 percent
	
89.24
89.25		(2) on or after the first day of the first pay period 
beginning afterfrom July 1, 2014, to June 30, 2016
	20.1 percent
	
89.26
89.27		(3) after June 30, 2016 from July 1, 2016, to June 30, 
2018
	21.6 percent
	
89.28		from July 1, 2018, to June 30, 2019
	22.35
	
89.29		after June 30, 2019
	23.1
	
89.30 	(b) Department contributions must be paid out of money appropriated to departments 
89.31 	for this purpose.
89.32 	(c) Contribution increases under paragraph (a) must be paid starting the first day of the 
89.33 	first full pay period after the effective date of the increase.
89.34 	(d) Effective July 1, 2018, department heads shall pay a supplemental employer 
89.35 	contribution. The supplemental contribution is 1.75 percent of the salary upon which 
90.1 	deductions are made from July 1, 2018, through June 30, 2019; three percent of the salary 
90.2 	upon which deductions are made from July 1, 2019, through June 30, 2020; five percent of 
90.3 	the salary which deductions are made from July 1, 2020, through June 30, 2021; and seven 
90.4 	percent of the salary upon which deductions are made thereafter. The supplemental 
90.5 	contribution must be paid starting the first day of the first full pay period after the effective 
90.6 	date of this subdivision. The supplemental contribution rate of seven percent remains in 
90.7 	effect until the market value of the assets of the State Patrol retirement plan of the Minnesota 
90.8 	State Retirement System equals or exceeds the actuarial accrued liability of the plan as 
90.9 	determined by the actuary retained under section 356.214. The expiration of the supplemental 
90.10 	employer contribution is effective the first day of the first full pay period of the fiscal year 
90.11 	immediately following the issuance of the actuarial valuation upon which the expiration is 
90.12 	based.

90.13 	EFFECTIVE DATE. This section is effective July 1, 2018.

90.14 	Sec. 8. Minnesota Statutes 2016, section 352D.04, subdivision 2, is amended to read:
90.15 		Subd. 2.Contribution rates. (a) The money used to purchase shares under this section 
90.16 	is the employee and employer contributions provided in this subdivision.
90.17 	(b) The employee contribution is an amount equal to the percent of salary specified in 
90.18 	section 352.04, subdivision 2, or 352.045, subdivision 3a.
90.19 	(c) The employer contribution is an amount equal to six percentthe following percentage 
90.20 	of salary.:

90.21		from July 1, 2018, through June 30, 2019
	6 percent
	
90.22		after June 30, 2019
	6.25 percent
	
90.23 	(d) For members of the legislature, the contributions under this subdivision also must 
90.24 	be made on per diem payments received during a regular or special legislative session, but 
90.25 	may not be made on per diem payments received outside of a regular or special legislative 
90.26 	session, on the additional compensation attributable to a leadership position under section 
90.27 	3.099, subdivision 3, living expense payments under section 3.101, or special session living 
90.28 	expense payments under section 3.103.
90.29 	(e) For a judge who is a member of the unclassified plan under section 352D.02, 
90.30 	subdivision 1, paragraph (c), clause (16), the employee contribution rate is eight percent of 
90.31 	salary, and there is no employer contribution.
90.32 	(f) These contributions must be made in the manner provided in section 352.04, 
90.33 	subdivisions 4, 5, and 6.

91.1 	EFFECTIVE DATE. This section is effective July 1, 2018.

91.2 	Sec. 9. Minnesota Statutes 2016, section 353.65, subdivision 2, is amended to read:
91.3 		Subd. 2.Employee contribution. (a) For members other than members who were active 
91.4 	members of the former Minneapolis Firefighters Relief Association on December 29, 2011, 
91.5 	or for members other than members who were active members of the former Minneapolis 
91.6 	Police Relief Association on December 29, 2011, the employee contribution is an amount 
91.7 	equal to the following percentage of the total salary of each member, as follows: 9.6 percent 
91.8 	before calendar year 2014; 10.2 percent in calendar year 2014; and 10.8 percent in calendar 
91.9 	year 2015 and thereafter.

91.10		before January 1, 2019
	10.8 percent
	
91.11		from January 1, 2019, through December 31, 2019
	11.3 percent
	
91.12		from January 1, 2020, and thereafter
	11.8 percent
	
91.13 	(b) For members who were active members of the former Minneapolis Firefighters Relief 
91.14 	Association on December 29, 2011, the employee contribution is an amount equal to eight 
91.15 	percent of the monthly unit value under section 353.01, subdivision 10a, multiplied by 80 
91.16 	and expressed as a biweekly amount for each member. The employee contribution made 
91.17 	by a member with at least 25 years of service credit as an active member of the former 
91.18 	Minneapolis Firefighters Relief Association must be deposited in the postretirement health 
91.19 	care savings account established under section 352.98.
91.20 	(c) For members who were active members of the former Minneapolis Police Relief 
91.21 	Association on December 29, 2011, the employee contribution is an amount equal to eight 
91.22 	percent of the monthly unit value under section 353.01, subdivision 10b, multiplied by 80 
91.23 	and expressed as a biweekly amount for each member. The employee contribution made 
91.24 	by a member with at least 25 years of service credit as an active member of the former 
91.25 	Minneapolis Police Relief Association must be deposited in the postretirement health care 
91.26 	savings account established under section 352.98.
91.27 	(d) Contributions under this section must be made by deduction from salary in the manner 
91.28 	provided in subdivision 4. Where any portion of a member's salary is paid from other than 
91.29 	public funds, the member's employee contribution is based on the total salary received from 
91.30 	all sources.

91.31 	EFFECTIVE DATE. This section is effective July 1, 2018.

92.1 	Sec. 10. Minnesota Statutes 2016, section 353.65, subdivision 3, is amended to read:
92.2 		Subd. 3.Employer contribution. (a) With respect to members other than members who 
92.3 	were active members of the former Minneapolis Firefighters Relief Association on December 
92.4 	29, 2011, or for members other than members who were active members of the former 
92.5 	Minneapolis Police Relief Association on December 29, 2011, the employer contribution 
92.6 	is an amount equal to the following percentage of the total salary of each member, as follows: 
92.7 	14.4 percent before calendar year 2014; 15.3 percent in calendar year 2014; and 16.2 percent 
92.8 	in calendar year 2015 and thereafter.

92.9		before January 1, 2019
	16.2 percent
	
92.10		from January 1, 2019, through December 31, 2019
	16.95 percent
	
92.11		from January 1, 2020, and thereafter
	17.7 percent
	
92.12 	(b) With respect to members who were active members of the former Minneapolis 
92.13 	Firefighters Relief Association on December 29, 2011, the employer contribution is an 
92.14 	amount equal to the amount of the member contributions under subdivision 2, paragraph 
92.15 	(b).
92.16 	(c) With respect to members who were active members of the former Minneapolis Police 
92.17 	Relief Association on December 29, 2011, the employer contribution is an amount equal 
92.18 	to the amount of the member contributions under subdivision 2, paragraph (c).
92.19 	(d) Contributions under this subdivision must be made from funds available to the 
92.20 	employing subdivision by the means and in the manner provided in section 353.28.

92.21 	EFFECTIVE DATE. This section is effective July 1, 2018.

92.22 	Sec. 11. Minnesota Statutes 2016, section 354.42, subdivision 2, is amended to read:
92.23 		Subd. 2.Employee contribution. (a) The employee contribution to the fund is the 
92.24 	following percentage of the member's salary:

92.25		Period
	Basic Program
	Coordinated Program
	
92.26		from July 1, 2013, until June 30, 2014
	10.5 percent
	7 percent
	
92.27
92.28		after June 30, 2014 from July 1, 2014, 
through June 30, 2023
	11 percent
	7.5 percent
	
92.29		after June 30, 2023
	11.25 percent
	7.75 percent
	
92.30 	(b) When an employee contribution rate changes for a fiscal year, the new contribution 
92.31 	rate is effective for the entire salary paid for each employer unit with the first payroll cycle 
92.32 	reported.
93.1 	(c) After June 30, 2015, if a contribution rate revision is required under subdivisions 4a, 
93.2 	4b, and 4c, the employee contributions under paragraphs (a) and (b) must be adjusted 
93.3 	accordingly.
93.4 	(d) This contribution must be made by deduction from salary. Where any portion of a 
93.5 	member's salary is paid from other than public funds, the member's employee contribution 
93.6 	must be based on the entire salary received.

93.7 	EFFECTIVE DATE. This section is effective July 1, 2018.

93.8 	Sec. 12. Minnesota Statutes 2016, section 354.42, subdivision 3, is amended to read:
93.9 		Subd. 3.Employer. (a) The regular employer contribution to the fund by Special School 
93.10 	District No. 1, Minneapolis, is an amount equal to the applicable following percentage of 
93.11 	salary of each coordinated member and the applicable percentage of salary of each basic 
93.12 	member specified in paragraph (c).
93.13 	The additional employer contribution to the fund by Special School District No. 1, 
93.14 	Minneapolis, is an amount equal to 3.64 percent of the salary of each teacher who is a 
93.15 	coordinated member or who is a basic member.
93.16 	(b) The regular employer contribution to the fund by Independent School District No. 
93.17 	709, Duluth, is an amount equal to the applicable percentage of salary of each old law or 
93.18 	new law coordinated member specified for the coordinated program in paragraph (c).
93.19 	(c) The employer contribution to the fund for every other employer is an amount equal 
93.20 	to the applicable following percentage of the salary of each coordinated member and the 
93.21 	applicable following percentage of the salary of each basic member:

93.22		Period
	Coordinated Member
		Basic Member
	
93.23		from July 1, 2013, until June 30, 2014
		7 percent
		11 percent
	
93.24
93.25		after June 30, 2014 from July 1, 2014, 
through June 30, 2018
		7.5 percent
		11.5 percent
	
93.26		from July 1, 2018, through June 30, 2019
		7.71 percent
		11.71 percent
	
93.27		from July 1, 2019, through June 30, 2020
		7.92 percent
		11.92 percent
	
93.28		from July 1, 2020, through June 30, 2021
		8.13 percent
		12.13 percent
	
93.29		from July 1, 2021, through June 30, 2022
		8.34 percent
		12.34 percent
	
93.30		from July 1, 2022, through June 30, 2023
		8.55 percent
		12.55 percent
	
93.31		after June 30, 2023
		8.75 percent
		12.75 percent
	
94.1 	(d) When an employer contribution rate changes for a fiscal year, the new contribution 
94.2 	rate is effective for the entire salary paid for each employer unit with the first payroll cycle 
94.3 	reported.
94.4 	(e) After June 30, 2015, if a contribution rate revision is made under subdivisions 4a, 
94.5 	4b, and 4c, the employer contributions under paragraphs (a), (b), and (c) must be adjusted 
94.6 	accordingly.

94.7 	EFFECTIVE DATE. This section is effective July 1, 2018.

94.8 	Sec. 13. Minnesota Statutes 2016, section 354A.12, subdivision 1, is amended to read:
94.9 		Subdivision 1.Employee contributions. (a) The contribution required to be paid by 
94.10 	each member of the St. Paul Teachers Retirement Fund Association is the percentage of 
94.11 	total salary specified below for the applicable association and program:

94.12		Program
	Percentage of Total Salary
	
94.13	St. Paul Teachers Retirement Fund Association
		
94.14		basic program after June 30, 2014
	9 percent
	
94.15		basic program after June 30, 2015
	9.5 percent
	
94.16		basic program after June 30, 2016
	10 percent
	
94.17		basic program after June 30, 2022
	10.25 percent
	
94.18		coordinated program after June 30, 2014
	6.5 percent
	
94.19		coordinated program after June 30, 2015
	7 percent
	
94.20		coordinated program after June 30, 2016
	7.5 percent
	
94.21		coordinated program after June 30, 2022
	7.75 percent
	
94.22 	(b) Contributions must be made by deduction from salary and must be remitted directly 
94.23 	to the St. Paul Teachers Retirement Fund Association at least once each month.
94.24 	(c) When an employee contribution rate changes for a fiscal year, the new contribution 
94.25 	rate is effective for the entire salary paid by the employer with the first payroll cycle reported.

94.26 	EFFECTIVE DATE. This section is effective July 1, 2018.

94.27 	Sec. 14. Minnesota Statutes 2016, section 354A.12, subdivision 2a, is amended to read:
94.28 		Subd. 2a.Employer regular and additional contributions. (a) The employing units 
94.29 	shall make the following employer contributions to the teachers retirement fund association:
94.30 	(1) for anyeach coordinated member of the St. Paul Teachers Retirement Fund 
94.31 	Association, the employing unit shall make a regular employer contribution to the retirement 
95.1 	fund association in an amount equal to the designated percentage of the salary of the 
95.2 	coordinated member as provided below:

95.3		after June 30, 2014
	5.5 percent
	
95.4		after June 30, 2015
	6 percent
	
95.5		after June 30, 2016
	6.25 percent
	
95.6		after June 30, 2017
	6.5 percent
	
95.7		after June 30, 2018
	7.335 percent
	
95.8		after June 30, 2019
	8.17 percent
	
95.9		after June 30, 2020
	8.38 percent
	
95.10		after June 30, 2021
	8.59 percent
	
95.11		after June 30, 2022
	8.8 percent
	
95.12		after June 30, 2023
	9 percent
	
95.13 	(2) for anyeach basic member of the St. Paul Teachers Retirement Fund Association, 
95.14 	the employing unit shall make a regular employer contribution to the respective retirement 
95.15 	fund in an amount according to the schedule below:

95.16		after June 30, 2014
	9 percent of salary
	
95.17		after June 30, 2015
	9.5 percent of salary
	
95.18		after June 30, 2016
	9.75 percent of salary
	
95.19		after June 30, 2017
	10 percent of salary
	
95.20		after June 30, 2018
	10.835 percent of salary
	
95.21		after June 30, 2019
	11.67 percent of salary
	
95.22		after June 30, 2020
	11.88 percent of salary
	
95.23		after June 30, 2021
	12.09 percent of salary
	
95.24		after June 30, 2022
	12.3 percent of salary
	
95.25		after June 30, 2023
	12.5 percent of salary
	
95.26 	(3) for aeach basic member of the St. Paul Teachers Retirement Fund Association, the 
95.27 	employing unit shall make an additional employer contribution to the respective fund in an 
95.28 	amount equal to 3.64 percent of the salary of the basic member;
95.29 	(4) for aeach coordinated member of the St. Paul Teachers Retirement Fund Association, 
95.30 	the employing unit shall make an additional employer contribution to the respective fund 
95.31 	in an amount equal to 3.84 percent of the coordinated member's salary.
95.32 	(b) The regular and additional employer contributions must be remitted directly to the 
95.33 	St. Paul Teachers Retirement Fund Association at least once each month. Delinquent amounts 
95.34 	are payable with interest under the procedure in subdivision 1a.
96.1 	(c) Payments of regular and additional employer contributions for school district or 
96.2 	technical college employees who are paid from normal operating funds must be made from 
96.3 	the appropriate fund of the district or technical college.
96.4 	(d) When an employer contribution rate changes for a fiscal year, the new contribution 
96.5 	rate is effective for the entire salary paid by the employer with the first payroll cycle reported.

96.6 	EFFECTIVE DATE. This section is effective July 1, 2018.

96.7 	ARTICLE 8
96.8 	DIRECT STATE AID

96.9 	Section 1. Minnesota Statutes 2016, section 353.65, is amended by adding a subdivision 
96.10 	to read:
96.11 		Subd. 3b.Direct state aid. (a) The state shall pay $4,500,000 on October 1, 2018, and 
96.12 	October 1, 2019, to the public employees police and fire retirement plan. By October 1 of 
96.13 	each year after 2019, the state shall pay $9,000,000 to the public employees police and fire 
96.14 	retirement plan. The commissioner of management and budget shall pay the aid specified 
96.15 	in this subdivision. The amount required is annually appropriated from the general fund to 
96.16 	the commissioner of management and budget.
96.17 	(b) The aid under paragraph (a) continues until the earlier of:
96.18 	(1) the first day of the fiscal year following the fiscal year in which the actuarial value 
96.19 	of assets of the fund equals or exceeds 100 percent of the actuarial accrued liabilities as 
96.20 	reported by the actuary retained under section 356.214 in the annual actuarial valuation 
96.21 	prepared under section 356.215; or
96.22 	(2) July 1, 2048.

96.23 	EFFECTIVE DATE. This section is effective July 1, 2018.

96.24 	Sec. 2. Minnesota Statutes 2016, section 354.435, subdivision 4, is amended to read:
96.25 		Subd. 4.Expiration. ThisThe aid amounts specified in this section expires effective
96.26 	shall continue until the earlier of:
96.27 	(1) the first day of the fiscal year next following the fiscal year in which the Teachers 
96.28 	Retirement Association has no unfundedactuarial value of assets of the fund equals or 
96.29 	exceeds 100 percent of the actuarial accrued liabilityliabilities as determined by thereported 
96.30 	by the actuary retained under section 356.214 in the annual actuarial valuation prepared 
96.31 	under section 356.215by the approved actuary retained under section 356.214.; or
97.1 	(2) July 1, 2048.

97.2 	EFFECTIVE DATE. This section is effective July 1, 2018.

97.3 	Sec. 3. Minnesota Statutes 2016, section 354.436, subdivision 3, is amended to read:
97.4 		Subd. 3.Aid expiration. The aid amounts specified in this section terminate and this 
97.5 	section expires on the October 1 next following the later of the following dates: (1) when 
97.6 	the current assets of the Teachers Retirement Association fund equal or exceedcontinue 
97.7 	until the earlier of:
97.8 	(1) the first day of the fiscal year following the fiscal year in which the actuarial value 
97.9 	of assets of the fund equals or exceeds 100 percent of the actuarial accrued liabilities of the 
97.10 	fund as determined in the most recent actuarial valuation report for the Teachers Retirement 
97.11 	Association fundreported by the actuary retained under section 356.214 in the annual 
97.12 	actuarial valuation prepared under section 356.215; or
97.13 	(2) when the member and employer contribution rates are first determined to be eligible 
97.14 	for a reduction under section 354.42, subdivisions 4a, 4b, 4c, and 4d July 1, 2048.

97.15 	EFFECTIVE DATE. This section is effective July 1, 2018.

97.16 	Sec. 4. Minnesota Statutes 2016, section 354A.12, subdivision 3a, is amended to read:
97.17 		Subd. 3a. Direct state aid to first class city teachers retirement fund associations.
 97.18 	(a) The state shall pay $2,827,000 to the St. Paul Teachers Retirement Fund Association.
97.19 	(b) In addition to other amounts specified in this subdivision, the state shall pay 
97.20 	$7,000,000 as state aid to the St. Paul Teachers Retirement Fund Association.
97.21 	(c) In addition to the amounts specified in paragraphs (a) and (b), the state shall pay 
97.22 	$5,000,000 as state aid to the St. Paul Teachers Retirement Fund Association.
97.23 	(c)(d) The aid under this subdivision is payable October 1 annually. The commissioner 
97.24 	of management and budget shall pay the aid specified in this subdivision. The amount 
97.25 	required is appropriated annually from the general fund to the commissioner of management 
97.26 	and budget.

97.27 	EFFECTIVE DATE. This section is effective July 1, 2018.

97.28 	Sec. 5. Minnesota Statutes 2016, section 354A.12, subdivision 3c, is amended to read:
97.29 		Subd. 3c.Termination of supplemental contributions and direct matching and state 
97.30 	aid. (a) The supplemental contributions payable to the St. Paul Teachers Retirement Fund 
98.1 	Association by Independent School District No. 625 under section 423A.02, subdivision 3, 
98.2 	and all forms ofthe aid under subdivision 3a to the St. Paul Teachers Retirement Fund 
98.3 	Association must, paragraphs (a) and (b), continue until the actuarialearlier of:
98.4 	(1) the first day of the fiscal year following the year in which the actuarial value of assets 
98.5 	of the fund equalequals or exceedexceeds 100 percent of the actuarial accrued liability of 
98.6 	the fund as determined in the most recent actuarial report for the fundreported by the actuary 
98.7 	retained under section 356.214 or until the established date for full funding under section 
98.8 	356.215, subdivision 11, whichever occurs earlier in the most recent annual actuarial 
98.9 	valuation prepared under section 356.215; or
98.10 	(2) July 1, 2048.
98.11 	(b) The aid to the Duluth Teachers Retirement Fund Association under section 423A.02, 
98.12 	subdivision 3, and all forms of state aid under subdivision 3a to the Duluth Teachers 
98.13 	Retirement Fund Association must continue until the current assets of the fund equal or 
98.14 	exceed the actuarial accrued liability of the fund as determined in the most recent actuarial 
98.15 	report for the fund by the actuary retained under section 356.214 or until the established 
98.16 	date for full funding under section 356.215, subdivision 11, whichever occurs earlier.
98.17 	(b) The aid under subdivision 3a, paragraph (c), continues until the earlier of:
98.18 	(1) the first day of the fiscal year following the fiscal year in which the actuarial value 
98.19 	of assets of the fund equals or exceeds 100 percent of the actuarial accrued liabilities as 
98.20 	reported by the actuary retained under section 356.214 in the annual actuarial valuation 
98.21 	prepared under section 356.215; or
98.22 	(2) July 1, 2048.

98.23 	EFFECTIVE DATE. This section is effective July 1, 2018.

98.24 	Sec. 6. Minnesota Statutes 2016, section 423A.02, subdivision 3, is amended to read:
98.25 		Subd. 3.Reallocation of amortization state aid. (a) Seventy percent of the difference 
98.26 	between $5,720,000 and the current year amortization aid distributed under subdivision 1 
98.27 	that is not distributed for any reason to a municipality must be distributed by the 
98.28 	commissioner of revenue according to this paragraph. The commissioner shall distribute 
98.29 	60 percent of the amounts derived under this paragraph to the Teachers Retirement 
98.30 	Association, and 40 percent to the St. Paul Teachers Retirement Fund Association to fund 
98.31 	the unfunded actuarial accrued liabilities of the respective funds. These payments must be 
98.32 	made on July 15 each fiscal year. If the St. Paul Teachers Retirement Fund Association or 
98.33 	the Duluth Teachers Retirement Fund Association becomes fully funded, the association's 
99.1 	eligibility for its portion of this aid ceases. State aid under this subdivision continues until 
99.2 	the date specified in subdivision 5. Amounts remaining in the undistributed balance account 
99.3 	at the end of the biennium if aid eligibility ceases cancel to the general fund.
99.4 	(b) In order to receive amortization aid under paragraph (a), before June 30 annually 
99.5 	Independent School District No. 625, St. Paul, must make an additional contribution of 
99.6 	$800,000 each year to the St. Paul Teachers Retirement Fund Association.
99.7 	(c) Thirty percent of the difference between $5,720,000 and the current year amortization 
99.8 	aid under subdivision 1 that is not distributed for any reason to a municipality must be 
99.9 	distributed under section 69.021, subdivision 7, paragraph (d), as additional funding to 
99.10 	support a minimum fire state aid amount for volunteer firefighter relief associations.

99.11 	EFFECTIVE DATE. This section is effective July 1, 2018.

99.12 	Sec. 7. Minnesota Statutes 2016, section 423A.02, subdivision 5, is amended to read:
99.13 		Subd. 5.Termination of state aid programs. (a) The amortization state aid and 
99.14 	additional amortization state aid programs terminate as offor the St. Paul Teachers 
99.15 	Retirement Fund Association continues until the earlier of:
99.16 	(1) the December 31, next following the date of the actuarial valuation whenend of the 
99.17 	fiscal year in which the actuarial value of assets of the St. Paul Teachers Retirement Fund 
99.18 	Association equalfund equals or exceeds 100 percent of the actuarial accrued liability of 
99.19 	that plan or when the assets of the Duluth Teachers Retirement Fund Association equal the 
99.20 	actuarial accrued liability of that plan, whichever is later. liabilities as reported by the actuary 
99.21 	retained under section 356.214 in the annual actuarial valuation report prepared under section 
99.22 	356.215; or
99.23 	(2) July 1, 2048.
99.24 	(b) The amortization state aid and additional amortization state aid programs for the 
99.25 	Teachers Retirement Association continue until the earlier of:
99.26 	(1) the December 31 following the end of the fiscal year in which the actuarial value of 
99.27 	assets of the fund equals or exceeds 100 percent of the actuarial accrued liabilities as reported 
99.28 	by the actuary retained under section 356.214 in the annual actuarial valuation prepared 
99.29 	under section 356.215; or
99.30 	(2) July 1, 2048.

99.31 	EFFECTIVE DATE. This section is effective July 1, 2018.

100.1 	Sec. 8. Minnesota Statutes 2016, section 423A.022, subdivision 5, is amended to read:
100.2 		Subd. 5.Aid termination. (a) The aid under subdivision 2, paragraph (a), clauses (1) 
100.3 	and (3), ends oncontinues until the earlier of:
100.4 	(1) the December 1 next following the actuarial valuation date onend of the fiscal year 
100.5 	in which the actuarial value of assets of both the State Patrol retirement plan and the public 
100.6 	employees police and fire retirement plan on a market value basis equals or exceeds 90 
100.7 	percent of the total actuarial accrued liabilities of the retirement plan as disclosed in an
100.8 	reported by the actuary retained under section 356.214 in the annual actuarial valuation 
100.9 	prepared under section 356.215and the Standards for Actuarial Work promulgated by the 
100.10 	Legislative Commission on Pensions and Retirement, for the State Patrol retirement plan 
100.11 	or the public employees police and fire retirement plan, whichever occurs last; or
100.12 	(2) July 1, 2048.
100.13 	(b) The aid under subdivision 2, paragraph (a), clause (2), does not terminate.

100.14 	EFFECTIVE DATE. This section is effective July 1, 2018.

100.15 	Sec. 9. Minnesota Statutes 2016, section 490.123, is amended by adding a subdivision to 
100.16 	read:
100.17 		Subd. 5.Direct state aid. (a) The state shall pay $6,000,000 annually to the judges' 
100.18 	retirement fund. The aid is payable each October 1. The commissioner of management and 
100.19 	budget shall pay the aid specified in this subdivision. The amount required is annually 
100.20 	appropriated from the general fund to the commissioner of management and budget.
100.21 	(b) The aid under paragraph (a) continues until the earlier of:
100.22 	(1) the first day of the fiscal year following the fiscal year in which the actuarial value 
100.23 	of assets of the fund equals or exceeds 100 percent of the actuarial accrued liabilities as 
100.24 	reported by the actuary retained under section 356.214 in the annual actuarial valuation 
100.25 	prepared under section 356.215; or
100.26 	(2) July 1, 2048.

100.27 	EFFECTIVE DATE. This section is effective July 1, 2018.

100.28 	ARTICLE 9
100.29 	MINNESOTA STATE RETIREMENT SYSTEM
100.30 	ADMINISTRATIVE PROVISIONS

100.31 	Section 1. Minnesota Statutes 2016, section 3A.03, subdivision 2, is amended to read:
101.1 		Subd. 2.Refund.  (a) A former member who has made contributions under subdivision 
101.2 	1 and who is no longer a member of the legislature is entitled to receive, upon written 
101.3 	application to the executive director on a form prescribed by the executive director, a refund 
101.4 	from the general fund of all contributions credited to the member's account with interest 
101.5 	computed as provided in section 352.22, subdivision 2.
101.6 	(b) The refund of contributions as provided in paragraph (a) terminates all rights of a 
101.7 	former member of the legislature and the survivors of the former member under this chapter.
101.8 	(c) If the former member of the legislature again becomes a member of the legislature 
101.9 	after having taken a refund as provided in paragraph (a), the member is a member of the 
101.10 	unclassified employees retirement program of the Minnesota State Retirement System.
101.11 	(d) However, the member may reinstate the rights and credit for service previously 
101.12 	forfeited under this chapter if the member repays all refunds taken, plus interest at the rate 
101.13 	of 8.5 percent until June 30, 2015, and eight percent thereafter compounded annually from 
101.14 	the date on which the refund was taken to the date on which the refund is repaid. Repayment 
101.15 	must be made as provided in section 352.23, paragraph (d).
101.16 	(e) No person may be required to apply for or to accept a refund.

101.17 	EFFECTIVE DATE. This section is effective July 1, 2018.

101.18 	Sec. 2. Minnesota Statutes 2016, section 3A.03, subdivision 3, is amended to read:
101.19 		Subd. 3.Legislators retirement fund. (a) The legislators retirement fund, a special 
101.20 	retirement fund, is created within the state treasury. The legislators retirement fund must 
101.21 	be credited with any investment proceeds on the assets of the retirement fund.
101.22 	(b) The payment of annuities under section 3A.115, paragraph (b), is appropriated from 
101.23 	the legislators retirement fund.
101.24 	(c) The legislators retirement fund may receive transfers of general fund proceeds.

101.25 	EFFECTIVE DATE. This section is effective July 1, 2018.

101.26 	Sec. 3. Minnesota Statutes 2016, section 16A.14, subdivision 2a, is amended to read:
101.27 		Subd. 2a.Exceptions. The allotment and encumbrance system does not apply to:
101.28 	(1) appropriations for the courts or the legislature;
101.29 	(2) payment of unemployment benefits.; and
102.1 	(3) transactions within the defined contribution funds administered by the Minnesota 
102.2 	State Retirement System.

102.3 	EFFECTIVE DATE. This section is effective July 1, 2018.

102.4 	Sec. 4. Minnesota Statutes 2016, section 352.01, subdivision 2a, is amended to read:
102.5 		Subd. 2a.Included employees. (a) "State employee" includes:
102.6 	(1) employees of the Minnesota Historical Society;
102.7 	(2) employees of the State Horticultural Society;
102.8 	(3) employees of the Minnesota Crop Improvement Association;
102.9 	(4) employees of the adjutant general whose salaries are paid from federal funds and 
102.10 	who are not covered by any federal civilian employees retirement system;
102.11 	(5) employees of the Minnesota State Colleges and Universities who are employed under 
102.12 	the university or college activities program;
102.13 	(6) currently contributing employees covered by the system who are temporarily 
102.14 	employed by the legislature during a legislative session or any currently contributing 
102.15 	employee employed for any special service as defined in subdivision 2b, clause (6);
102.16 	(7) employees of the legislature who are appointed without a limit on the duration of 
102.17 	their employment;
102.18 	(8) trainees who are employed on a full-time established training program performing 
102.19 	the duties of the classified position for which they will be eligible to receive immediate 
102.20 	appointment at the completion of the training period;
102.21 	(9) employees of the Minnesota Safety Council;
102.22 	(10) any employees who are on authorized leave of absence from the Transit Operating 
102.23 	Division of the former Metropolitan Transit Commission and who are employed by the 
102.24 	labor organization which is the exclusive bargaining agent representing employees of the 
102.25 	Transit Operating Division;
102.26 	(11) employees of the Metropolitan Council, Metropolitan Parks and Open Space 
102.27 	Commission, Metropolitan Sports Facilities Commission, or Metropolitan Mosquito Control 
102.28 	Commission unless excluded under subdivision 2b or are covered by another public pension 
102.29 	fund or plan under section 473.415, subdivision 3;
102.30 	(12) judges of the Tax Court;
103.1 	(13) personnel who were employed on June 30, 1992, by the University of Minnesota 
103.2 	in the management, operation, or maintenance of its heating plant facilities, whose 
103.3 	employment transfers to an employer assuming operation of the heating plant facilities, so 
103.4 	long as the person is employed at the University of Minnesota heating plant by that employer 
103.5 	or by its successor organization;
103.6 	(14) personnel who are employed as seasonal employees in the classified or unclassified 
103.7 	service;
103.8 	(15) persons who are employed by the Department of Commerce as a peace officer in 
103.9 	the Commerce Fraud Bureau under section 45.0135 who have attained the mandatory 
103.10 	retirement age specified in section 43A.34, subdivision 4;
103.11 	(16) employees of the University of Minnesota unless excluded under subdivision 2b, 
103.12 	clause (3);
103.13 	(17) employees of the Middle Management Association whose employment began after 
103.14 	July 1, 2007, and to whom section 352.029 does not apply;
103.15 	(18) employees of the Minnesota Government Engineers Council to whom section 
103.16 	352.029 does not apply;
103.17 	(19) employees of the Minnesota Sports Facilities Authority;
103.18 	(20) employees of the Minnesota Association of Professional Employees;
103.19 	(21) employees of the Minnesota State Retirement System;
103.20 	(22) employees of the State Agricultural Society;
103.21 	(23) employees of the Gillette Children's Hospital Board who were employed in the 
103.22 	state unclassified service at the former Gillette Children's Hospital on March 28, 1974; and
103.23 	(24) if approved for coverage by the Board of Directors of Conservation Corps Minnesota, 
103.24 	employees of Conservation Corps Minnesota so employed on June 30, 2003.; and
103.25 	(25) employees of the Perpich Center for Arts Education who are covered by the general 
103.26 	state employees retirement plan of the Minnesota State Retirement System as of July 1, 
103.27 	2016.
103.28 	(b) Employees specified in paragraph (a), clause (13), are included employees under 
103.29 	paragraph (a) if employer and employee contributions are made in a timely manner in the 
103.30 	amounts required by section 352.04. Employee contributions must be deducted from salary. 
103.31 	Employer contributions are the sole obligation of the employer assuming operation of the 
104.1 	University of Minnesota heating plant facilities or any successor organizations to that 
104.2 	employer.

104.3 	EFFECTIVE DATE. This section is effective July 1, 2018.

104.4 	Sec. 5. Minnesota Statutes 2016, section 352.03, subdivision 5, is amended to read:
104.5 		Subd. 5.Executive director;, deputy director, and assistant director. (a) The board 
104.6 	shall appoint an executive director, in this chapter called the director, of the system must 
104.7 	be appointed by the board on the basis of fitness education, experience in the retirement 
104.8 	field, and leadership ability to manage and lead system staff, and ability to assist the board 
104.9 	in setting a vision for the system. The director must have had at least five years' experience 
104.10 	on the administrative staff of a major retirement system in either an executive level 
104.11 	management position or in a position with responsibility for the governance, management, 
104.12 	or administration of a retirement plan.
104.13 	(b) The executive director, deputy director, and assistant director must be in the 
104.14 	unclassified service but appointees may be selected from civil service lists if desired. 
104.15 	Notwithstanding any law to the contrary, the board must set the salary of the executive 
104.16 	director. The salary of the executive director must not exceed the limit for a position listed 
104.17 	in section 15A.0815, subdivision 2. The salary of the deputy director and assistant director 
104.18 	must be set in accordance with section 43A.18, subdivision 3.

104.19 	EFFECTIVE DATE. This section is effective the day following final enactment.

104.20 	Sec. 6. Minnesota Statutes 2016, section 352.03, subdivision 6, is amended to read:
104.21 		Subd. 6.Duties and powers of executive director. The management of the system is 
104.22 	vested in the director, who is the executive and administrative head of the system. The 
104.23 	director may appoint a deputy director and an assistant director with the approval of the 
104.24 	board. The director shall be advisor to the board on matters pertaining to the system and 
104.25 	shall also act as the secretary of the board. The director shall:
104.26 	(1) attend meetings of the board;
104.27 	(2) prepare and recommend to the board appropriate rules to carry out this chapter;
104.28 	(3) establish and maintain an adequate system of records and accounts following 
104.29 	recognized accounting principles and controls;
104.30 	(4) designate an assistant director with the approval of the board;
105.1 	(5)(4) appoint any employees, both permanent and temporary, that are necessary to 
105.2 	carry out the provisions of this chapter;
105.3 	(6)(5) organize the work of the system as the director deems necessary to fulfill the 
105.4 	functions of the system, and define the duties of its employees and delegate to them any 
105.5 	powers or duties, subject to the control of the director and under conditions the director may 
105.6 	prescribe. Appointments to exercise delegated power must be by written order and shall be 
105.7 	filed with the secretary of state;
105.8 	(7)(6) with the advice and consent of the board, contract for the services of an approved 
105.9 	actuary, professional management services, and any other consulting services as necessary 
105.10 	and fix the compensation for those services. The contracts are not subject to competitive 
105.11 	bidding under chapter 16C. Any approved actuary retained by the executive director shall 
105.12 	function as the actuarial advisor of the board and the executive director, and may perform 
105.13 	actuarial valuations and experience studies to supplement those performed by the actuary 
105.14 	retained under section 356.214. Any supplemental actuarial valuations or experience studies 
105.15 	shall be filed with the executive director of the Legislative Commission on Pensions and 
105.16 	Retirement. Professional management services may not be contracted for more often than 
105.17 	once in six years. Copies of professional management survey reports must be transmitted 
105.18 	to the secretary of the senate, the chief clerk of the house of representatives, and the 
105.19 	Legislative Reference Library as provided by section 3.195, and to the executive director 
105.20 	of the commission at the time as reports are furnished to the board. Only management firms 
105.21 	experienced in conducting management surveys of federal, state, or local public retirement 
105.22 	systems are qualified to contract with the director;
105.23 	(8)(7) with the advice and consent of the board provide in-service training for the 
105.24 	employees of the system;
105.25 	(9)(8) make refunds of accumulated contributions to former state employees and to the 
105.26 	designated beneficiary, surviving spouse, legal representative, or next of kin of deceased 
105.27 	state employees or deceased former state employees, as provided in this chapter;
105.28 	(10)(9) determine the amount of the annuities and disability benefits of employees 
105.29 	covered by the system and authorize payment of the annuities and benefits beginning as of 
105.30 	the dates on which the annuities and benefits begin to accrue, in accordance with the 
105.31 	provisions of this chapter;
105.32 	(11)(10) pay annuities, refunds, survivor benefits, salaries, and necessary operating 
105.33 	expenses of the system;
105.34 	(12)(11) certify funds available for investment to the State Board of Investment;
106.1 	(13)(12) with the advice and approval of the board request the State Board of Investment 
106.2 	to sell securities when the director determines that funds are needed for the system;
106.3 	(14)(13) prepare and submit to the board and the legislature an annual financial report 
106.4 	covering the operation of the system, as required by section 356.20;
106.5 	(15)(14) prepare and submit biennial and annual budgets to the board and with the 
106.6 	approval of the board submit the budgets to the Department of Management and Budget; 
106.7 	and
106.8 	(16)(15) with the approval of the board, perform other duties required to administer the 
106.9 	retirement and other provisions of this chapter and to do its business.

106.10 	EFFECTIVE DATE. This section is effective July 1, 2018.

106.11 	Sec. 7. Minnesota Statutes 2016, section 352.113, subdivision 4, is amended to read:
106.12 		Subd. 4.Medical or psychological examinations; authorization for payment of 
106.13 	benefit. (a) Any physician, psychologist, chiropractor, or physician assistant, or nurse 
106.14 	practitioner providing any service specified in this section must be licensed.
106.15 	(b) An applicant shall provide a detailed report signed by a physician, and at least one 
106.16 	additional report signed by a physician, chiropractor, psychologist, orchiropractor, physician 
106.17 	assistant, or nurse practitioner with evidence to support an application for total and permanent 
106.18 	disability. The reports must include an expert opinion regarding whether the employee is 
106.19 	permanently and totally disabled within the meaning of section 352.01, subdivision 17, and 
106.20 	that the disability arose before the employee was placed on any paid or unpaid leave of 
106.21 	absence or terminated public service.
106.22 	(c) If there is medical evidence that supports the expectation that at some point the person 
106.23 	applying for the disability benefit will no longer be disabled, the decision granting the 
106.24 	disability benefit may provide for a termination date upon which the total and permanent 
106.25 	disability can be expected to no longer exist. When a termination date is part of the decision 
106.26 	granting benefits, prior to the benefit termination the executive director shall review any 
106.27 	evidence provided by the disabled employee to show that the disabling condition for which 
106.28 	benefits were initially granted continues. If the benefits cease, the disabled employee may 
106.29 	follow the appeal procedures described in section 356.96 or may reapply for disability 
106.30 	benefits using the process described in this subdivision.
106.31 	(d) Any claim to disability must be supported by a report from the employer indicating 
106.32 	that there is no available work that the employee can perform with the disabling condition 
106.33 	and that all reasonable accommodations have been considered. Upon request of the executive 
107.1 	director, an employer shall provide evidence of the steps the employer has taken to attempt 
107.2 	to provide reasonable accommodations and continued employment to the claimant.
107.3 	(e) The director shall also obtain written certification from the employer stating whether 
107.4 	the employment has ceased or whether the employee is on sick leave of absence because 
107.5 	of a disability that will prevent further service to the employer and that the employee is not 
107.6 	entitled to compensation from the employer.
107.7 	(f) The medical adviser shall consider the reports of the physicians, physician assistants, 
107.8 	psychologists, and chiropractorsphysician, psychologist, chiropractor, physician assistant, 
107.9 	or nurse practitioner and any other evidence supplied by the employee or other interested 
107.10 	parties. If the medical adviser finds the employee totally and permanently disabled, the 
107.11 	adviser shall make appropriate recommendation to the director in writing together with the 
107.12 	date from which the employee has been totally disabled. The director shall then determine 
107.13 	if the disability occurred within 18 months of filing the application, while still in the 
107.14 	employment of the state, and the propriety of authorizing payment of a disability benefit as 
107.15 	provided in this section and constitutes a total and permanent disability as defined in section 
107.16 	352.01, subdivision 17.
107.17 	(g) A terminated employee may apply for a disability benefit within 18 months of 
107.18 	termination as long as the disability occurred while in the employment of the state. The fact 
107.19 	that an employee is placed on leave of absence without compensation because of disability 
107.20 	does not bar that employee from receiving a disability benefit.
107.21 	(h) Upon appeal, the board of directors may extend the disability benefit application 
107.22 	deadline in paragraph (g) by an additional 18 months if the terminated employee is 
107.23 	determined by the board of directors to have a cognitive impairment that made it unlikely 
107.24 	that the terminated employee understood that there was an application deadline or that the 
107.25 	terminated employee was able to meet the application deadline.
107.26 	(h) (i) Unless the payment of a disability benefit has terminated because the employee 
107.27 	is no longer totally disabled, or because the employee has reached normal retirement age 
107.28 	as provided in this section, the disability benefit must cease with the last payment received 
107.29 	by the disabled employee or which had accrued during the lifetime of the employee unless 
107.30 	there is a spouse surviving. In that event, the surviving spouse is entitled to the disability 
107.31 	benefit for the calendar month in which the disabled employee died.

107.32 	EFFECTIVE DATE. This section is effective July 1, 2018.

108.1 	Sec. 8. Minnesota Statutes 2016, section 352.113, subdivision 14, is amended to read:
108.2 		Subd. 14.Disabilitant earnings reports. Disability benefit recipients must report all 
108.3 	earnings from reemployment and income from workers' compensation to the system annually 
108.4 	by May 15 in a format prescribed by the executive director. The executive director may 
108.5 	waive the earnings report requirement for any disabled employee who is not required to 
108.6 	undergo regular medical or psychological examinations under subdivision 6. If the form is 
108.7 	not submitted by June 15, benefits must be suspended effective July 1. If the form deemed 
108.8 	acceptable by the executive director is received after the June 15 deadline, benefits shall be 
108.9 	reinstated retroactive to July 1.

108.10 	EFFECTIVE DATE. This section is effective July 1, 2018.

108.11 	Sec. 9. Minnesota Statutes 2016, section 352.23, is amended to read:
108.12 	352.23 TERMINATION OF RIGHTS; REPAYMENT OF REFUND.
108.13 	(a) When any employee accepts a refund as provided in section 352.22, all existing 
108.14 	allowable service credits and all rights and benefits to which the employee was entitled 
108.15 	before accepting the refund terminate.
108.16 	(b) Terminated service credits and rights must not again be restored until the former 
108.17 	employee acquires at least six months of allowable service credit after taking the last refund. 
108.18 	In that event, the employee may repayand repays all refunds previously taken from the 
108.19 	retirement fund with interest as provided in paragraph (d).
108.20 	(c) Repayment of refunds entitles the employee only to credit for service covered by (1) 
108.21 	salary deductions; (2) payments previously made in lieu of salary deductions as permitted 
108.22 	under law in effect when the payment in lieu of deductions was made; (3) payments made 
108.23 	to obtain credit for service as permitted by laws in effect when payment was made; and (4) 
108.24 	allowable service previously credited while receiving temporary workers' compensation as 
108.25 	provided in section 352.01, subdivision 11, paragraph (a), clause (3).
108.26 	(d) Payments under this section for repayment of refunds are to be paid with interest at 
108.27 	the rate of 8.5 percent until June 30, 2015, and eight percent thereafter compounded annually 
108.28 	from the date the refund was taken until the date the refund is repaid. TheyRepayment may 
108.29 	be paid in a lump sum or by payroll deduction in the manner provided in section 352.04. 
108.30 	Payment may be made in partial payments consistent with section 356.44 during employment 
108.31 	or in a lump sum up to six months after termination from service.

108.32 	EFFECTIVE DATE. This section is effective July 1, 2018.

109.1 	Sec. 10. Minnesota Statutes 2016, section 352B.11, subdivision 4, is amended to read:
109.2 		Subd. 4.Reentry into state service. When a former member, who has become separated 
109.3 	from state service that entitled the member to membership and has received a refund of 
109.4 	retirement payments, reenters the state service in a position that entitles the member to 
109.5 	membership, that member shall receive credit for the period of prior allowable state service 
109.6 	if the member repays into the fund the amount of the refund, plus interest on it at the rate 
109.7 	of 8.5 percent until June 30, 2015, and eight percent thereafter compounded annually, at 
109.8 	any time before subsequent retirement. Repayment may be made in installments or in a 
109.9 	lump sum. Repayment must be made as provided in section 352.23, paragraph (d).

109.10 	EFFECTIVE DATE. This section is effective July 1, 2018.

109.11 	Sec. 11. Minnesota Statutes 2016, section 352D.02, subdivision 1, is amended to read:
109.12 		Subdivision 1.Coverage.  (a) Employees enumerated in paragraph (c), clauses (2), (3), 
109.13 	(4), (6) to (14), and (16) to (18), if they are in the unclassified service of the state or 
109.14 	Metropolitan Council and are eligible for coverage under the general state employees 
109.15 	retirement plan under chapter 352, are participants in the unclassified program under this 
109.16 	chapter unless the employee gives notice to the executive director of the Minnesota State 
109.17 	Retirement System within one year following the commencement of employment in the 
109.18 	unclassified service that the employee desires coverage under the general state employees 
109.19 	retirement plan. For the purposes of this chapter, an employee who does not file notice with 
109.20 	the executive director is deemed to have exercised the option to participate in the unclassified 
109.21 	program.
109.22 	(b) Persons referenced in paragraph (c), clause (5), are participants in the unclassified 
109.23 	program under this chapter unless the person was eligible to elect different coverage under 
109.24 	section 3A.07 and elected retirement coverage by the applicable alternative retirement plan. 
109.25 	Persons referenced in paragraph (c), clause (15), are participants in the unclassified program 
109.26 	under this chapter for judicial employment in excess of the service credit limit in section 
109.27 	490.121, subdivision 22.
109.28 	(c) Enumerated employees and referenced persons are:
109.29 	(1) the governor, the lieutenant governor, the secretary of state, the state auditor, and 
109.30 	the attorney general;
109.31 	(2) an employee in the Office of the Governor, Lieutenant Governor, Secretary of State, 
109.32 	State Auditor, Attorney General;
109.33 	(3) an employee of the State Board of Investment;
110.1 	(4) the head of a department, division, or agency created by statute in the unclassified 
110.2 	service, an acting department head subsequently appointed to the position, or an employee 
110.3 	enumerated in section 15A.0815 or 15A.083, subdivision 4;
110.4 	(5) a member of the legislature;
110.5 	(6) an unclassified employee of the legislature or a commission or agency of the 
110.6 	legislature who is appointed without a limit on the duration of the employment or a temporary 
110.7 	legislative employee having shares in the supplemental retirement fund as a result of former 
110.8 	employment covered by this chapter, whether or not eligible for coverage under the 
110.9 	Minnesota State Retirement System;
110.10 	(7) a person who is employed in a position established under section 43A.08, subdivision 
110.11 	1, clause (3), or in a position authorized under a statute creating or establishing a department 
110.12 	or agency of the state, which is at the deputy or assistant head of department or agency or 
110.13 	director level;
110.14 	(8) the regional administrator, or executive director of the Metropolitan Council, general 
110.15 	counsel, division directors, operations managers, and other positions as designated by the 
110.16 	council, all of which may not exceed 27 positions at the council and the chair;
110.17 	(9) the commissioner, deputy commissioner, and not to exceed nine positions of the 
110.18 	Minnesota Office of Higher Education in the unclassified service, as designated by the 
110.19 	Minnesota Office of Higher Education before January 1, 1992, or subsequently redesignated 
110.20 	with the approval of the board of directors of the Minnesota State Retirement System, unless 
110.21 	the person has elected coverage by the individual retirement account plan under chapter 
110.22 	354B;
110.23 	(10) the clerk of the appellate courts appointed under article VI, section 2, of the 
110.24 	Constitution of the state of Minnesota, the state court administrator and judicial district 
110.25 	administrators;
110.26 	(11) the chief executive officers of correctional facilities operated by the Department of 
110.27 	Corrections and of hospitals and nursing homes operated by the Department of Human 
110.28 	Services;
110.29 	(12) an employee whose principal employment is at the state ceremonial house;
110.30 	(13) an employee of the Agricultural Utilization Research Institute;
110.31 	(14) an employee of the State Lottery who is covered by the managerial plan established 
110.32 	under section 43A.18, subdivision 3;
111.1 	(15) a judge who has exceeded the service credit limit in section 490.121, subdivision 
111.2 	22;
111.3 	(16) an employee of Enterprise Minnesota, Inc.;
111.4 	(17) a person employed by the Minnesota State Colleges and Universities as faculty or 
111.5 	in an eligible unclassified administrative position as defined in section 354B.20, subdivision 
111.6 	6, who was employed by the former state university or the former community college system 
111.7 	before May 1, 1995, and elected unclassified program coverage prior to May 1, 1995; and
111.8 	(18) a person employed by the Minnesota State Colleges and Universities who was 
111.9 	employed in state service before July 1, 1995, who subsequently is employed in an eligible 
111.10 	unclassified administrative position as defined in section 354B.20, subdivision 6, and who 
111.11 	elects coverage by the unclassified program.

111.12 	EFFECTIVE DATE. This section is effective July 1, 2018.

111.13 	Sec. 12. Minnesota Statutes 2016, section 352D.02, subdivision 3, is amended to read:
111.14 		Subd. 3.Transfer to general employees retirement plan. (a) If permitted under 
111.15 	paragraph (b), an employeeA person in the unclassified program and referred to in 
111.16 	subdivision 1, paragraph (c), clauses (2) to (4), (6) to (14), and (16) to (18), who is credited 
111.17 	with shares in the unclassified program and has credit for allowable service may elect to 
111.18 	terminate participation in the unclassified program and be covered by the general state 
111.19 	employees retirement plan. (b) An employee specified in paragraph (a) is permitted to 
111.20 	terminate participation in the unclassified program and be covered byif the person files an 
111.21 	election to transfer to the general state employees retirement plan if the employee with the 
111.22 	executive director of the Minnesota State Retirement System as provided in paragraph (b) 
111.23 	and the person's current employment or appointment:
111.24 	(1) was employedbegan before July 1, 2010, and the person has at least ten years of 
111.25 	allowable service covered employment; or
111.26 	(2) was first employedbegan after June 30, 2010, and the person has no more than seven 
111.27 	years of allowable service in the unclassified program.
111.28 	The(b) An election to transfer must be in writing, on a form provided by the executive 
111.29 	director, and can be made no later than one month following the termination of covered 
111.30 	employment. delivered to the executive director:
111.31 	(1) for persons described in paragraph (a), clause (1), no later than one month following 
111.32 	the termination of covered employment; or
112.1 	(2) for persons described in paragraph (a), clause (2), by the earlier of (i) the end of the 
112.2 	month following the termination of employment in a position covered by the unclassified 
112.3 	program, and (ii) the last day of the seventh year of allowable service in the unclassified 
112.4 	program.
112.5 	For purposes of this chapter, an employee who does not file an election to transfer with 
112.6 	the executive director is deemed to have exercised the option to participate in the unclassified 
112.7 	program.
112.8 	(c) If the transfer election is made, the executive director shall redeem the employee's 
112.9 	total shares and credit to the employee's account in the general employees retirement plan 
112.10 	the amount of contributions that would have been credited had the employee been covered 
112.11 	by the general employees retirement plan during the employee's entire covered employment. 
112.12 	The balance of money redeemed and not credited to the employee's account must be 
112.13 	transferred to the general employees retirement plan, except that the executive director must 
112.14 	determine:
112.15 	(1) the employee contributions paid to the unclassified program; and
112.16 	(2) the employee contributions that would have been paid to the general employees 
112.17 	retirement plan for the comparable period, if the individual had been covered by that plan.
112.18 	If clause (1) is greater than clause (2), the difference must be refunded to the employee 
112.19 	as provided in section 352.22. If clause (2) is greater than clause (1), the difference must 
112.20 	be paid by the employee within six months of electing general employees retirement plan 
112.21 	coverage or before the effective date of the annuity, whichever is sooner.
112.22 	(d) An election under paragraph (b) to transfer coverage to the general employees 
112.23 	retirement plan is irrevocable during any period of covered employment.
112.24 	(e) A person referenced in subdivision 1, paragraph (c), clause (1), (5), or (15), who is 
112.25 	credited with employee shares in the unclassified program is not permitted to terminate 
112.26 	participation in the unclassified program and be covered by the general employees retirement 
112.27 	plan.

112.28 	EFFECTIVE DATE. This section is effective July 1, 2018.

112.29 	Sec. 13. Minnesota Statutes 2016, section 352D.05, subdivision 4, is amended to read:
112.30 		Subd. 4.Repayment of refund. (a) A participant in the unclassified program may repay 
112.31 	regular refunds taken under section 352.22, as provided in section 352.23.
113.1 	(b) A participant in the unclassified program or an employee covered by the general 
113.2 	employees retirement plan who has withdrawn the value of the total shares may repay the 
113.3 	refund taken and thereupon restore the service credit, rights and benefits forfeited by paying 
113.4 	into the fund the amount refunded plus interest at the rate of 8.5 percent until June 30, 2015, 
113.5 	and eight percent thereafter compounded annually from the date that the refund was taken 
113.6 	until the date that the refund is repaid. If the participant had withdrawn only the employee 
113.7 	shares as permitted under prior laws, repayment must be pro rata.
113.8 	(c) Except as provided in section 356.441, the repayment of a refund under this section 
113.9 	must be made in a lump sum Repayment must be made as provided in section 352.23, 
113.10 	paragraph (d).

113.11 	EFFECTIVE DATE. This section is effective July 1, 2018.

113.12 	Sec. 14. Minnesota Statutes 2016, section 490.124, subdivision 12, is amended to read:
113.13 		Subd. 12.Refund.  (a) A person who ceases to be a judge is entitled to a refund in an 
113.14 	amount that is equal to all of the member's employee contributions to the judges' retirement 
113.15 	fund plus interest computed under section 352.22, subdivision 2.
113.16 	(b) A refund of contributions under paragraph (a) terminates all service credits and all 
113.17 	rights and benefits of the judge and the judge's survivors under this chapter.
113.18 	(c) A person who becomes a judge again after taking a refund under paragraph (a) may 
113.19 	reinstate the previously terminated allowable service credit, rights, and benefits by repaying 
113.20 	the total amount of the previously received refund. The refund repayment must include 
113.21 	interest on the total amount previously received at the annual rate of 8.5 percent until June 
113.22 	30, 2015, and eight percent thereafter, compounded annually, from the date on which the 
113.23 	refund was received until the date on which the refund is repaid. Repayment must be made 
113.24 	as provided in section 352.23, paragraph (d).

113.25 	EFFECTIVE DATE. This section is effective July 1, 2018.

113.26 	ARTICLE 10
113.27 	PUBLIC EMPLOYEES RETIREMENT ASSOCIATION
113.28 	ADMINISTRATIVE PROVISIONS

113.29 	Section 1. Minnesota Statutes 2016, section 353.01, subdivision 2b, is amended to read:
113.30 		Subd. 2b.Excluded employees. (a) The following public employees are not eligible to 
113.31 	participate as members of the association with retirement coverage by the general employees 
114.1 	retirement plan, the local government correctional employees retirement plan under chapter 
114.2 	353E, or the public employees police and fire retirement plan:
114.3 	(1) persons whose annual salary from one governmental subdivision never exceeds an 
114.4 	amount, stipulated in writing in advance, of $5,100 if the person is not a school district 
114.5 	employee or $3,800 if the person is a school year employee. If annual compensation from 
114.6 	one governmental subdivision to an employee exceeds the stipulated amount in a calendar 
114.7 	year or a school year, whichever applies, after being stipulated in advance not to exceed the 
114.8 	applicable amount, the stipulation is no longer valid and contributions must be made on 
114.9 	behalf of the employee under section 353.27, subdivision 12, from the first month in which 
114.10 	the employee received salary exceeding $425 in a month;
114.11 	(2) public officers who are elected to a governing body, city mayors, or persons who 
114.12 	are appointed to fill a vacancy in an electiveelected office of a governing body, whose term 
114.13 	of office commences on or after July 1, 2002, for the service to be rendered in that elective
114.14 	elected position;
114.15 	(3) election judges and persons employed solely to administer elections;
114.16 	(4) patient and inmate personnel who perform services for a governmental subdivision;
114.17 	(5) except as otherwise specified in subdivision 12a, employees who are employed solely 
114.18 	in a temporary position as defined under subdivision 12a, and employees who resign from 
114.19 	a nontemporary position and accept a temporary position within 30 days of that resignation 
114.20 	in the same governmental subdivision;
114.21 	(6) employees who are employed by reason of work emergency caused by fire, flood, 
114.22 	storm, or similar disaster, but if the person becomes a probationary or provisional employee 
114.23 	within the same pay period, other than on a temporary basis, the person is a "public 
114.24 	employee" retroactively to the beginning of the pay period;
114.25 	(7) employees who by virtue of their employment in one governmental subdivision are 
114.26 	required by law to be a member of and to contribute to any of the plans or funds administered 
114.27 	by the Minnesota State Retirement System, the Teachers Retirement Association, or the St. 
114.28 	Paul Teachers Retirement Fund Association, but this exclusion must not be construed to 
114.29 	prevent a person from being a member of and contributing to the Public Employees 
114.30 	Retirement Association and also belonging to and contributing to another public pension 
114.31 	plan or fund for other service occurring during the same period of time, and a person who 
114.32 	meets the definition of "public employee" in subdivision 2 by virtue of other service occurring 
114.33 	during the same period of time becomes a member of the association unless contributions 
115.1 	are made to another public retirement plan on the salary based on the other service or to the 
115.2 	Teachers Retirement Association by a teacher as defined in section 354.05, subdivision 2;
115.3 	(8) persons who are members of a religious order and are excluded from coverage under 
115.4 	the federal Old Age, Survivors, Disability, and Health Insurance Program for the performance 
115.5 	of service as specified in United States Code, title 42, section 410(a)(8)(A), as amended, if 
115.6 	no irrevocable election of coverage has been made under section 3121(r) of the Internal 
115.7 	Revenue Code of 1954, as amended;
115.8 	(9) persons who are:
115.9 	(i) employed by a governmental subdivision who have not reached the age of 23 and 
115.10 	who are enrolled on a full-time basis to attend or are attending classes on a full-time basis 
115.11 	at an accredited school, college, or university in an undergraduate, graduate, or 
115.12 	professional-technical program, or at a public or charter high school;
115.13 	(ii) employed as resident physicians, medical interns, pharmacist residents, or pharmacist 
115.14 	interns and are serving in a degree or residency program in a public hospital or in a public 
115.15 	clinic; or
115.16 	(iii) students who are serving for a period not to exceed five years in an internship or a 
115.17 	residency program that is sponsored by a governmental subdivision, including an accredited 
115.18 	educational institution;
115.19 	(10) persons who hold a part-time adult supplementary technical college license who 
115.20 	render part-time teaching service in a technical college;
115.21 	(11) except for employees offor the first three years of employment, foreign citizens 
115.22 	who are employed by a governmental subdivision, other than Hennepin County or employees 
115.23 	of Hennepin Healthcare System, Inc., foreign citizens who are employed by a governmental 
115.24 	subdivision under aone or more work permitpermits or under an H-1b visa initially issued 
115.25 	or extended for a combined period of less than three years of employment but upon extension 
115.26 	of the employment of thevisa beyond the three-year period, the foreign citizen must be 
115.27 	reported for membership beginning on the first of the month following the extension if the 
115.28 	monthly earnings threshold as provided under subdivision 2a, paragraph (a), is met work 
115.29 	visas;
115.30 	(12) public hospital employees who elected not to participate as members of the 
115.31 	association before 1972 and who did not elect to participate from July 1, 1988, to October 
115.32 	1, 1988;
116.1 	(13) except as provided in section 353.86, volunteer ambulance service personnel, as 
116.2 	defined in subdivision 35, but persons who serve as volunteer ambulance service personnel 
116.3 	may still qualify as public employees under subdivision 2 and may be members of the Public 
116.4 	Employees Retirement Association and participants in the general employees retirement 
116.5 	plan or the public employees police and fire plan, whichever applies, on the basis of 
116.6 	compensation received from public employment service other than service as volunteer 
116.7 	ambulance service personnel;
116.8 	(14) except as provided in section 353.87, volunteer firefighters, as defined in subdivision 
116.9 	36, engaging in activities undertaken as part of volunteer firefighter duties, but a person 
116.10 	who is a volunteer firefighter may still qualify as a public employee under subdivision 2 
116.11 	and may be a member of the Public Employees Retirement Association and a participant 
116.12 	in the general employees retirement plan or the public employees police and fire plan, 
116.13 	whichever applies, on the basis of compensation received from public employment activities 
116.14 	other than those as a volunteer firefighter;
116.15 	(15) pipefitters and associated trades personnel employed by Independent School District 
116.16 	No. 625, St. Paul, with coverage under a collective bargaining agreement by the pipefitters 
116.17 	local 455 pension plan who were either first employed after May 1, 1997, or, if first employed 
116.18 	before May 2, 1997, elected to be excluded under Laws 1997, chapter 241, article 2, section 
116.19 	12;
116.20 	(16) electrical workers, plumbers, carpenters, and associated trades personnel who are 
116.21 	employed by Independent School District No. 625, St. Paul, or the city of St. Paul, who 
116.22 	have retirement coverage under a collective bargaining agreement by the Electrical Workers 
116.23 	Local 110 pension plan, the United Association Plumbers Local 34 pension plan, or the 
116.24 	pension plan applicable to Carpenters Local 322 who were either first employed after May 
116.25 	1, 2000, or, if first employed before May 2, 2000, elected to be excluded under Laws 2000, 
116.26 	chapter 461, article 7, section 5;
116.27 	(17) bricklayers, allied craftworkers, cement masons, glaziers, glassworkers, painters, 
116.28 	allied tradesworkers, and plasterers who are employed by the city of St. Paul or Independent 
116.29 	School District No. 625, St. Paul, with coverage under a collective bargaining agreement 
116.30 	by the Bricklayers and Allied Craftworkers Local 1 pension plan, the Cement Masons Local 
116.31 	633 pension plan, the Glaziers and Glassworkers Local L-1324 pension plan, the Painters 
116.32 	and Allied Trades Local 61 pension plan, or the Twin Cities Plasterers Local 265 pension 
116.33 	plan who were either first employed after May 1, 2001, or if first employed before May 2, 
116.34 	2001, elected to be excluded under Laws 2001, First Special Session chapter 10, article 10, 
116.35 	section 6;
117.1 	(18) plumbers who are employed by the Metropolitan Airports Commission, with 
117.2 	coverage under a collective bargaining agreement by the Plumbers Local 34 pension plan, 
117.3 	who either were first employed after May 1, 2001, or if first employed before May 2, 2001, 
117.4 	elected to be excluded under Laws 2001, First Special Session chapter 10, article 10, section 
117.5 	6;
117.6 	(19) employees who are hired after June 30, 2002, solely to fill seasonal positions under 
117.7 	subdivision 12b which are limited in duration by the employer to 185 consecutive calendar 
117.8 	days or less in each year of employment with the governmental subdivision;
117.9 	(20) persons who are provided supported employment or work-study positions by a 
117.10 	governmental subdivision and who participate in an employment or industries program 
117.11 	maintained for the benefit of these persons where the governmental subdivision limits the 
117.12 	position's duration to up to five years, including persons participating in a federal or state 
117.13 	subsidized on-the-job training, work experience, senior citizen, youth, or unemployment 
117.14 	relief program where the training or work experience is not provided as a part of, or for, 
117.15 	future permanent public employment;
117.16 	(21) independent contractors and the employees of independent contractors;
117.17 	(22) reemployed annuitants of the association during the course of that reemployment;
117.18 	(23) persons appointed to serve on a board or commission of a governmental subdivision 
117.19 	or an instrumentality thereof;
117.20 	(24) persons employed as full-time fixed-route bus drivers by the St. Cloud Metropolitan 
117.21 	Transit Commission who are members of the International Brotherhood of Teamsters Local 
117.22 	638 and who are, by virtue of that employment, members of the International Brotherhood 
117.23 	of Teamsters Central States pension plan; and
117.24 	(25) electricians or pipefitters employed by the Minneapolis Park and Recreation Board, 
117.25 	with coverage under a collective bargaining agreement by the IBEW local 292, or pipefitters 
117.26 	local 539 pension plan, who were first employed before May 2, 2015, and who elected to 
117.27 	be excluded under Laws 2015, chapter 68, article 11, section 5.
117.28 	(b) Any person performing the duties of a public officer in a position defined in 
117.29 	subdivision 2a, paragraph (a), clause (3), is not an independent contractor and is not an 
117.30 	employee of an independent contractor.

117.31 	EFFECTIVE DATE. This section is effective July 1, 2018.

118.1 	Sec. 2. Minnesota Statutes 2016, section 353.01, subdivision 10, is amended to read:
118.2 		Subd. 10.Salary. (a) Subject to the limitations of section 356.611, "salary" means:
118.3 	(1) the wages or periodic compensation payable to a public employee by the employing 
118.4 	governmental subdivision before:
118.5 	(i) employee retirement deductions that are designated as picked-up contributions under 
118.6 	section 356.62;
118.7 	(ii) any employee-elected deductions for deferred compensation, supplemental retirement 
118.8 	plans, or other voluntary salary reduction programs that would have otherwise been available 
118.9 	as a cash payment to the employee; and
118.10 	(iii) employee deductions for contributions to a supplemental plan or to a governmental 
118.11 	trust established under section 356.24, subdivision 1, clause (7), to save for postretirement 
118.12 	health care expenses, unless otherwise excluded under paragraph (b);
118.13 	(2) for a public employee who is covered by a supplemental retirement plan under section 
118.14 	356.24, subdivision 1, clause (8), (9), (10), or (12), the employer contributions to the 
118.15 	applicable supplemental retirement plan when an agreement between the parties establishes 
118.16 	that the contributions will either result in a mandatory reduction of employees' wages through 
118.17 	payroll withholdings, or be made in lieu of an amount that would otherwise be paid as 
118.18 	wages;
118.19 	(3) a payment from a public employer through a grievance proceeding, settlement, or 
118.20 	court order that is attached to a specific earnings period in which the employee's regular 
118.21 	salary was not earned or paid to the member due to a suspension or a period of involuntary 
118.22 	termination that is not a wrongful discharge under section 356.50; provided the amount is 
118.23 	not less than the equivalent of the average of the hourly base salary rate in effect during the 
118.24 	last six months of allowable service prior to the suspension or period of involuntary 
118.25 	termination, plus any applicable increases awarded during the period that would have been 
118.26 	paid under a collective bargaining agreement or personnel policy but for the suspension or 
118.27 	involuntary termination, multiplied by the average number of regular hours for which the 
118.28 	employee was compensated during the six months of allowable service prior to the suspension 
118.29 	or period of involuntary termination, but not to exceed the compensation that the public 
118.30 	employee would have earned if regularly employed during the applicable period;
118.31 	(4) for a member who is absent from employment due tocompensation paid during an 
118.32 	authorized leave of absence, other than an authorized medical leave of absence, as long as 
119.1 	the compensation paid during the leave if equivalent toa pay period is not less than the 
119.2 	lesser of:
119.3 	(i) the product of the average hourly base salary rate in effect during the six months of 
119.4 	allowable service, or portions thereof, prior toimmediately preceding the leave, multiplied 
119.5 	by the average number of regular hours for which the employee was compensated each pay 
119.6 	period during the six months of allowable service prior toimmediately preceding the 
119.7 	applicable leave of absence; or
119.8 	(ii) compensation equal to the value of the employee's total available accrued leave 
119.9 	hours;
119.10 	(5) for a member who is absent from employment by reason ofcompensation paid during 
119.11 	an authorized medical leave of absence, other than a workers' compensation leave, as long 
119.12 	as the compensation paid during the leave if specified in advance to be at leasta pay period 
119.13 	is not less than the lesser of:
119.14 	(i) the product of one-half of, but no more than equal to, the earnings the member 
119.15 	received, on which contributions were reported and allowable service creditedand the 
119.16 	average hourly base salary rate in effect during the six months of allowable service 
119.17 	immediately preceding the medical leave of absence; and or
119.18 	(ii) compensation equal to the value of the employee's total available accrued leave 
119.19 	hours; and
119.20 	(6) for a public employee who receives performance or merit bonus payment under a 
119.21 	written compensation plan, policy, or collective bargaining agreement in addition to regular 
119.22 	salary or in lieu of regular salary increases, the compensation paid to the employee for 
119.23 	attaining or exceeding performance goals, duties, or measures during a specified period of 
119.24 	employment.
119.25 	(b) Salary does not mean:
119.26 	(1) fees paid to district court reporters;
119.27 	(2) unused annual leave, vacation, or sick leave payments, in the form of lump-sum or 
119.28 	periodic payments;
119.29 	(3) for the donor, payment to another person of the value of hours donated under a 
119.30 	benevolent vacation, personal, or sick leave donation program;
119.31 	(4) any form of severance or retirement incentive payments;
119.32 	(5) an allowance payment or per diem payments for or reimbursement of expenses;
120.1 	(6) lump-sum settlements not attached to a specific earnings period;
120.2 	(7) workers' compensation payments or disability insurance payments, including payments 
120.3 	from employer self-insurance arrangements;
120.4 	(8) employer-paid amounts used by an employee toward the cost of insurance coverage, 
120.5 	flexible spending accounts, cafeteria plans, health care expense accounts, day care expenses, 
120.6 	or any payments in lieu of any employer-paid group insurance coverage, including the 
120.7 	difference between single and family rates that may be paid to a member with single coverage 
120.8 	and certain amounts determined by the executive director to be ineligible;
120.9 	(9) employer-paid fringe benefits, including, but not limited to:
120.10 	(i) employer-paid premiums or supplemental contributions for employees for all types 
120.11 	of insurance;
120.12 	(ii) membership dues or fees for the use of fitness or recreational facilities;
120.13 	(iii) incentive payments or cash awards relating to a wellness program;
120.14 	(iv) the value of any nonmonetary benefits;
120.15 	(v) any form of payment made in lieu of an employer-paid fringe benefit;
120.16 	(vi) an employer-paid amount made to a deferred compensation or tax-sheltered annuity 
120.17 	program; and
120.18 	(vii) any amount paid by the employer as a supplement to salary, either as a lump-sum 
120.19 	amount or a fixed or matching amount paid on a recurring basis, that is not available to the 
120.20 	employee as cash;
120.21 	(10) the amount equal to that which the employing governmental subdivision would 
120.22 	otherwise pay toward single or family insurance coverage for a covered employee when, 
120.23 	through a contract or agreement with some but not all employees, the employer:
120.24 	(i) discontinues, or for new hires does not provide, payment toward the cost of the 
120.25 	employee's selected insurance coverages under a group plan offered by the employer;
120.26 	(ii) makes the employee solely responsible for all contributions toward the cost of the 
120.27 	employee's selected insurance coverages under a group plan offered by the employer, 
120.28 	including any amount the employer makes toward other employees' selected insurance 
120.29 	coverages under a group plan offered by the employer; and
120.30 	(iii) provides increased salary rates for employees who do not have any employer-paid 
120.31 	group insurance coverages;
121.1 	(11) except as provided in section 353.86 or 353.87, compensation of any kind paid to 
121.2 	volunteer ambulance service personnel or volunteer firefighters, as defined in subdivision 
121.3 	35 or 36;
121.4 	(12) the amount of compensation that exceeds the limitation provided in section 356.611;
121.5 	(13) amounts paid by a federal or state grant for which the grant specifically prohibits 
121.6 	grant proceeds from being used to make pension plan contributions, unless the contributions 
121.7 	to the plan are made from sources other than the federal or state grant; and
121.8 	(14) bonus pay that is not performance or merit pay under paragraph (a), clause (6).
121.9 	(c) Amounts, other than those provided under paragraph (a), clause (3), provided to an 
121.10 	employee by the employer through a grievance proceeding, a court order, or a legal settlement 
121.11 	are salary only if the settlement or court order is reviewed by the executive director and the 
121.12 	amounts are determined by the executive director to be consistent with paragraph (a) and 
121.13 	prior determinations.

121.14 	EFFECTIVE DATE. This section is effective July 1, 2018.

121.15 	Sec. 3. Minnesota Statutes 2016, section 353.01, subdivision 47, is amended to read:
121.16 		Subd. 47.Vesting. (a) "Vesting" means obtaining a nonforfeitable entitlement to an 
121.17 	annuity or benefit from a retirement plan administered by the Public Employees Retirement 
121.18 	Association by having credit for sufficient allowable service under paragraph (b), (c), or 
121.19 	(d), whichever applies.
121.20 	(b) For purposes of qualifying for an annuity or benefit as a basic or coordinated plan 
121.21 	member of the general employees retirement plan of the Public Employees Retirement 
121.22 	Association:
121.23 	(1) a public employee who first became a member of the association before July 1, 2010, 
121.24 	is 100 percent vested when the person has accrued credit for not less than three years of 
121.25 	allowable service as defined under subdivision 16 in the general employees retirement plan; 
121.26 	and
121.27 	(2) a public employee who first becomes a member of the association after June 30, 
121.28 	2010, is 100 percent vested when the person has accrued credit for not less than five years 
121.29 	of allowable service as defined under subdivision 16 in the general employees retirement 
121.30 	plan.
121.31 	(c) For purposes of qualifying for an annuity or benefit as a member of the local 
121.32 	government correctional employeesservice retirement plan:
122.1 	(1) a public employee who first became a member of the association before July 1, 2010, 
122.2 	is 100 percent vested when the person has accrued credit for not less than three years of 
122.3 	allowable service as defined under subdivision 16 in the local government correctional 
122.4 	service retirement plan; and
122.5 	(2) a public employee who first becomes a member of the association after June 30, 
122.6 	2010, is vested at the following percentages when the person has accrued creditedcredit 
122.7 	for allowable service as defined under subdivision 16,in the local government correctional 
122.8 	service retirement plan, as follows:
122.9 	(i) 50 percent after five years;
122.10 	(ii) 60 percent after six years;
122.11 	(iii) 70 percent after seven years;
122.12 	(iv) 80 percent after eight years;
122.13 	(v) 90 percent after nine years; and
122.14 	(vi) 100 percent after ten years.
122.15 	(d) For purposes of qualifying for an annuity or benefit as a member of the public 
122.16 	employees police and fire retirement plan:
122.17 	(1) a public employee who first became a member of the association before July 1, 2010, 
122.18 	is 100 percent vested when the person has accrued credit for not less than three years of 
122.19 	allowable service as defined under subdivision 16 in the public employees police and fire 
122.20 	retirement plan;
122.21 	(2) a public employee who first becomes a member of the association after June 30, 
122.22 	2010, and before July 1, 2014, is vested at the following percentages when the person has 
122.23 	accrued credited allowable service as defined under subdivision 16 in the public employees 
122.24 	police and fire retirement plan, as follows:
122.25 	(i) 50 percent after five years;
122.26 	(ii) 60 percent after six years;
122.27 	(iii) 70 percent after seven years;
122.28 	(iv) 80 percent after eight years;
122.29 	(v) 90 percent after nine years; and
122.30 	(vi) 100 percent after ten years; and
123.1 	(3) a public employee who first becomes a member of the association after June 30, 
123.2 	2014, is vested at the following percentages when the person has accrued creditedcredit 
123.3 	for allowable service as defined under subdivision 16 in the public employees police and 
123.4 	fire retirement plan, as follows:
123.5 	(i) 50 percent after ten years;
123.6 	(ii) 55 percent after 11 years;
123.7 	(iii) 60 percent after 12 years;
123.8 	(iv) 65 percent after 13 years;
123.9 	(v) 70 percent after 14 years;
123.10 	(vi) 75 percent after 15 years;
123.11 	(vii) 80 percent after 16 years;
123.12 	(viii) 85 percent after 17 years;
123.13 	(ix) 90 percent after 18 years;
123.14 	(x) 95 percent after 19 years; and
123.15 	(xi) 100 percent after 20 or more years.

123.16 	EFFECTIVE DATE. This section is effective July 1, 2018.

123.17 	Sec. 4. Minnesota Statutes 2016, section 353.0162, is amended to read:
123.18 	353.0162 REDUCED SALARY PERIODS SALARY CREDIT PURCHASE FOR 
123.19 	PERIODS OF REDUCED SALARY.
123.20 	(a) A member may purchase additionaldifferential salary credit as described in paragraph 
123.21 	(c) for a period specified in this section paragraph (b).
123.22 	(b) The applicable period is a period during which the member is receiving no or a 
123.23 	reduced salary from the employer while the member is:
123.24 	(1) receiving temporary workers' compensation payments related to the member's service 
123.25 	to the public employer;
123.26 	(2) on an authorized leave of absence, except that if the authorized leave of absence 
123.27 	exceeds 12 months, the period of leave for which differential salary credit may be purchased 
123.28 	is limited to 12 months; or
124.1 	(3) on an authorized partial paid leave of absence as a result of a budgetary or salary 
124.2 	savings program offered or mandated by a governmental subdivision, if certified to the 
124.3 	executive director by the governmental subdivision.
124.4 	(c) The Differential salary amountcredit is the difference between the average monthly
124.5 	salary received by the member during thea period of reduced salary under this section
124.6 	specified in paragraph (b) and the average monthly salary of the member, excluding overtime, 
124.7 	on which contributions to the applicable plan werewould have been made during the period 
124.8 	of the last six months of covered employment occurring immediately before the period of 
124.9 	reduced salary, applied tobased on the member's normal employment period, measured in 
124.10 	hours or otherwise, as applicable, and rate of pay.
124.11 	(d) To receive eligibledifferential salary credit, the member shall pay the plan, by 
124.12 	delivering payment to the executive director, an amount equal to:
124.13 	(1) the applicable employee contribution rate under section 353.27, subdivision 2; 353.65, 
124.14 	subdivision 2; or 353E.03, subdivision 1, as applicable, multiplied by the differential salary 
124.15 	amount;
124.16 	(2) plus an employer equivalent payment equal to the applicable employer contribution 
124.17 	rate in section 353.27, subdivision 3; 353.65, subdivision 3; or 353E.03, subdivision 2, as 
124.18 	applicable, multiplied by the differential salary amount;
124.19 	(3) plus, if applicable, an equivalent employer additional amount equal to the additional 
124.20 	employer contribution rate in section 353.27, subdivision 3a, multiplied by the differential 
124.21 	salary amount.
124.22 	(e) The employer, by appropriate action of its governing body and documented in its 
124.23 	official records, may pay the employer equivalent contributions and, as applicable, the 
124.24 	equivalent employer additional contributions on behalf of the member.
124.25 	(f) Payment under this section must include interest on the contribution amount or 
124.26 	amounts, whichever applies, at an 8.5 percent annual rate until June 30, 2015, and at an 
124.27 	eight percent annual rate thereafter, prorated for applicable months from the date on which 
124.28 	the period of reduced salary specified under this sectionin paragraph (b) terminates to the 
124.29 	date on which the payment or payments are received by the executive director. Payment 
124.30 	under this section must be completed withinby the earlierearliest of:
124.31 	(1) 30 days fromafter termination of public service by the employee under section 
124.32 	353.01, subdivision 11a, or;
125.1 	(2) one year after the termination of the period specified in paragraph (b), as further 
125.2 	restricted under this section.; or
125.3 	(3) 30 days after the commencement of a disability benefit.
125.4 	(g) The period for which additional allowable salary credit may be purchased is limited 
125.5 	to the period during which the person receives temporary workers' compensation payments 
125.6 	or for those business years in which the governmental subdivision offers or mandates a 
125.7 	budget or salary savings program, as certified to the executive director by a resolution of 
125.8 	the governing body of the governmental subdivision. For an authorized leave of absence, 
125.9 	the period for which allowable salary credit may be purchased may not exceed 12 months 
125.10 	of authorized leave.
125.11 	(h) To purchase(g) If the member has purchased 12 months of differential salary credit
125.12 	for a subsequent period of temporary workers' compensation benefits or subsequent 
125.13 	authorized medical leave of absence, the member must return to public service and render 
125.14 	a minimum of three months of allowable service to purchase differential salary credit for a 
125.15 	subsequent leave of absence.

125.16 	EFFECTIVE DATE. This section is effective July 1, 2018.

125.17 	Sec. 5. Minnesota Statutes 2016, section 353.03, subdivision 3, is amended to read:
125.18 		Subd. 3.Duties and powers. (a) The board shall:
125.19 	(1) elect a president and vice-president;
125.20 	(2) approve the staffing complement, as recommended by the executive director, 
125.21 	necessary to administer the fund;
125.22 	(3) adopt bylaws for its own government and for the management of the fund consistent 
125.23 	with the laws of the state and may modify them at pleasure;
125.24 	(4) adopt, alter, and enforce reasonable rules consistent with the laws of the state and 
125.25 	the terms of the applicable benefit plans for the administration and management of the fund, 
125.26 	for the payment and collection of payments from members and for the payment of 
125.27 	withdrawals and benefits, and that are necessary in order to comply with the applicable 
125.28 	federal Internal Revenue Service and Department of Labor requirements;
125.29 	(5) pass upon and allow or disallow all applications for membership in the fund and 
125.30 	allow or disallow claims for withdrawals, pensions, or benefits payable from the fund;
125.31 	(6) authorize procedures for use of electronic signatures as defined in section 325L.02, 
125.32 	paragraph (h), on applications and forms required by the association;
126.1 	(7)(6) adopt an appropriate mortality table based on experience of the fund as 
126.2 	recommended by the association actuary and approved under section 356.215, subdivision 
126.3 	18, with interest set at the rate specified in section 356.215, subdivision 8;
126.4 	(8)(7) provide for the payment out of the fund of the cost of administering this chapter, 
126.5 	of all necessary expenses for the administration of the fund and of all claims for withdrawals, 
126.6 	pensions, or benefits allowed;
126.7 	(9)(8) approve or disapprove all recommendations and actions of the executive director 
126.8 	made subject to its approval or disapproval by subdivision 3a; and
126.9 	(10)(9) approve early retirement and optional annuity factors, subject to review by the 
126.10 	actuary retained by the Legislative Commission on Pensions and Retirement; establish the 
126.11 	schedule for implementation of the approved factors; and notify the Legislative Commission 
126.12 	on Pensions and Retirement of the implementation schedule.
126.13 	(b) In passing upon all applications and claims, the board may summon, swear, hear, 
126.14 	and examine witnesses and, in the case of claims for disability benefits, may require the 
126.15 	claimant to submit to a medical examination by a physician of the board's choice, at the 
126.16 	expense of the fund, as a condition precedent to the passing on the claim, and, in the case 
126.17 	of all applications and claims, may conduct investigations necessary to determine their 
126.18 	validity and merit.
126.19 	(c) The board may continue to authorize the sale of life insurance to members under the 
126.20 	insurance program in effect on January 1, 1985, but must not change that program without 
126.21 	the approval of the commissioner of management and budget. The association shall not 
126.22 	receive any financial benefit from the life insurance program beyond the amount necessary 
126.23 	to reimburse the association for costs incurred in administering the program. The association 
126.24 	shall not engage directly or indirectly in any other activity involving the sale or promotion 
126.25 	of goods or services, or both, whether to members or nonmembers.
126.26 	(d) The board shall establish procedures governing reimbursement of expenses to board 
126.27 	members. These procedures must define the types of activities and expenses that qualify 
126.28 	for reimbursement, must provide that all out-of-state travel be authorized by the board, and 
126.29 	must provide for the independent verification of claims for expense reimbursement. The 
126.30 	procedures must comply with the applicable rules and policies of the Department of 
126.31 	Management and Budget and the Department of Administration.
126.32 	(e) The board may purchase fiduciary liability insurance and official bonds for the 
126.33 	officers and members of the board of trustees and employees of the association and may 
127.1 	purchase property insurance or may establish a self-insurance risk reserve including, but 
127.2 	not limited to, data processing insurance and "extra-expense" coverage.

127.3 	EFFECTIVE DATE. This section is effective July 1, 2018.

127.4 	Sec. 6. Minnesota Statutes 2016, section 353.29, subdivision 4, is amended to read:
127.5 		Subd. 4.Application for annuity. Application for a retirement annuity or optional 
127.6 	annuity may be made by a member or by a person authorized to actacting on behalf of the 
127.7 	member, upon proof of authority satisfactory to the executive director. Every application 
127.8 	for retirement must be made in writing on a form or in a format prescribed by the executive 
127.9 	director and must be substantiated by written proof of the member's age and identity. The 
127.10 	notarized signature of a member's spouse on a retirement annuity application acknowledging 
127.11 	the member's annuity selection meets the notice requirement to the spouse under section 
127.12 	356.46, subdivision 3. An application for a retirement annuity is not complete until all 
127.13 	necessary supporting documents are received by the executive director.

127.14 	EFFECTIVE DATE. This section is effective July 1, 2018.

127.15 	Sec. 7. Minnesota Statutes 2016, section 353.29, subdivision 7, is amended to read:
127.16 		Subd. 7.Annuities; accrual Annuity starting date. (a) Except as to elected public 
127.17 	officials specified in paragraph (b), a retirement annuity granted under this chapter begins 
127.18 	withon the first day of the first calendar month after the date of termination of public service
127.19 	or up to six months before the first of the month in which a complete application is received 
127.20 	by the executive director under subdivision 4, whichever is later. The annuity must be paid 
127.21 	in equal monthly installments and does not accrue, unless suspended or reduced under 
127.22 	section 353.37. Annuity payments shall not be paid beyond the end of the month in which 
127.23 	entitlement to the annuity has terminated.
127.24 	(b) An annuity granted to an electiveelected public official accruesmay begin on the 
127.25 	day following the expiration of the public office or expiration of the right to hold that office
127.26 	that qualified the elected official for membership under section 353.01, subdivision 2a or 
127.27 	2d, if a complete application is received by the executive director under subdivision 4 within 
127.28 	six months of the date of termination of public service. The annuity for the month during 
127.29 	which the expiration occurred is prorated accordingly.
127.30 	(c) An annuity, once granted, must not be increased, decreased, or revoked except under 
127.31 	this chapter.
128.1 	(d) An annuity payment may be made retroactive for up to one year prior to that month 
128.2 	in which a complete application is received by the executive director under subdivision 4.
128.3 	(e)(d) If an annuitant dies before negotiating the check for the month in which death 
128.4 	occurs, payment must first be made to the surviving spouse, or if none, then to the designated 
128.5 	beneficiary, or if none, lastly to the estate.

128.6 	EFFECTIVE DATE. This section is effective July 1, 2018.

128.7 	Sec. 8. Minnesota Statutes 2016, section 353.30, subdivision 3c, is amended to read:
128.8 		Subd. 3c.Effective date of bounce-back annuity. In the event of the death of the 
128.9 	designated optional annuity beneficiary before the retired employee or disabilitant, the 
128.10 	restoration of the normal single life annuity under subdivision 3a or 3b will take effect on 
128.11 	the first of the month following the date of death of the designated optional annuity 
128.12 	beneficiary or on the first of the month following one yearsix months before the date on 
128.13 	which a certified copysatisfactory verification of the death record is received in the office 
128.14 	of the public employees retirement association established by the executive director, 
128.15 	whichever date is later.

128.16 	EFFECTIVE DATE. This section is effective July 1, 2018.

128.17 	Sec. 9. Minnesota Statutes 2016, section 353.32, subdivision 1, is amended to read:
128.18 		Subdivision 1.Before retirement. If a member or former member who terminated public 
128.19 	service dies before retirement or before receiving any retirement annuity and no other 
128.20 	payment of any kind is or may become payable to any person, a refund is payable to the 
128.21 	designated beneficiary or, if there be none, to the surviving spouse, or, if none, to the legal 
128.22 	representative of the decedent's estate. The refund must be in an amount equal to accumulated 
128.23 	deductions, less the sum of any disability or survivor benefits that have been paid by the 
128.24 	fund, plus annual compound interest thereon at the rate specified in section 353.34, 
128.25 	subdivision 2, and less the sum of any disability or survivor benefits, if any, that may have 
128.26 	been paid by the fund; provided that a survivor who has a right to benefits under section 
128.27 	353.31 may waive such benefits in writing, except such benefits for a dependent child under 
128.28 	the age of 18 years may only be waived under an order of the district court.

128.29 	EFFECTIVE DATE. This section is effective July 1, 2018.

129.1 	Sec. 10. Minnesota Statutes 2016, section 353.34, subdivision 2, is amended to read:
129.2 		Subd. 2.Refund with interest. (a) Except as provided in subdivision 1, any person who 
129.3 	ceases to be a public employee is entitled to receive a refund in an amount equal to 
129.4 	accumulated deductions with, less the sum of any disability benefits that have been paid by 
129.5 	the fund, plus annual compound interest to the first day of the month in which the refund 
129.6 	is processed.
129.7 	(b) For a person who ceases to be a public employee before July 1, 2011, the refund 
129.8 	interest is at the rate of six percent to June 30, 2011, and at the rate of four percent after 
129.9 	June 30, 2011. For a person who ceases to be a public employee after July 1, 2011, the 
129.10 	refund interest is at the rate of four percent.
129.11 	(c) If a person repays a refund and subsequently applies for another refund, the repayment 
129.12 	amount, including interest, is added to the fiscal year balance in which the repayment was 
129.13 	made.
129.14 	(d) If the refund payable to a member is based on employee deductions that are 
129.15 	determined to be invalid under section 353.27, subdivision 7, the interest payable on the 
129.16 	invalid employee deductions is four percent.

129.17 	EFFECTIVE DATE. This section is effective July 1, 2018.

129.18 	Sec. 11. Minnesota Statutes 2016, section 353.35, subdivision 1, is amended to read:
129.19 		Subdivision 1.Refund rights. (a) Except as provided in paragraph (b), when any former 
129.20 	member accepts a refund, all existing service credits and all rights and benefits to which 
129.21 	the person was entitled prior to the acceptance of the refund must terminate.
129.22 	(b) A refund under section 353.651, subdivision 3, paragraph (c), does not result in a 
129.23 	forfeiture of salary credit for the allowable service credit covered by the refund.
129.24 	(c) TheIf a person forfeits service credits, rights, and benefits under paragraph (a), the 
129.25 	person's service credits, rights, and benefits of a former member must notshall be restored 
129.26 	untilif the person returns to active service and acquiresemployment covered by the 
129.27 	association for at least six months of allowable service credit after taking the last refund
129.28 	and repays the refund or refunds taken and interestall amounts previously received under 
129.29 	section 353.34, subdivisions 1 andsubdivision 2, plus interest at the annual rate of 8.5 
129.30 	percent until June 30, 2015, and eight percent thereafter, compounded annually, from the 
129.31 	date each amount was received to the date the amount is repaid. If the person elects to restore 
129.32 	service credit in a particular fund from which the person has taken more than one refund, 
129.33 	the person must repay all refunds to that fund. All refundsThe repayment must be repaid
130.1 	made within six months of the last date of terminationday of public service employment. 
130.2 	A person may have service credits, rights, and benefits restored under this paragraph only 
130.3 	one time.

130.4 	EFFECTIVE DATE. This section is effective July 1, 2018.

130.5 	Sec. 12. Minnesota Statutes 2016, section 353.37, subdivision 1, is amended to read:
130.6 		Subdivision 1.Salary maximums. (a) The annuity of a person otherwise eligible for 
130.7 	an annuity from the general employees retirement plan of the Public Employees Retirement 
130.8 	Association, the public employees police and fire retirement plan, or the local government 
130.9 	correctional employees retirement plan must be suspended under subdivision 2 or reduced 
130.10 	under subdivision 3, whichever results in the higher annual annuity amount, ifupon the 
130.11 	person reenters public service as a nonelectiveperson's employment as a nonelected employee 
130.12 	of a governmental subdivision in a position not required by law to be a member of a plan 
130.13 	administered by the Minnesota State Retirement System, the Teachers Retirement 
130.14 	Association, or the St. Paul Teachers Retirement Fund Association, or returns to work as 
130.15 	an employee of a labor organization that represents public employees who are association 
130.16 	members under this chapter, and salary for the reemployment service exceeds the annual 
130.17 	maximum earnings allowable for that age for the continued receipt of full benefit amounts 
130.18 	monthly under the federal Old Age, Survivors and Disability Insurance Program as set by 
130.19 	the secretary of health and human services under United States Code, title 42, section 403, 
130.20 	in any calendar year. If the person has not yet reached the minimum age for the receipt of 
130.21 	Social Security benefits, the maximum salary for the person is equal to the annual maximum 
130.22 	earnings allowable for the minimum age for the receipt of Social Security benefits.
130.23 	(b) The provisions of paragraph (a) do not apply to the members of the general employees 
130.24 	plan of the Public Employees Retirement Association who were former members of MERF.

130.25 	EFFECTIVE DATE. This section is effective July 1, 2018.

130.26 	Sec. 13. Minnesota Statutes 2016, section 353.64, subdivision 10, is amended to read:
130.27 		Subd. 10.Pension coverage for Hennepin Healthcare System, Inc.; paramedics and 
130.28 	emergency medical technicians. An employee of Hennepin Healthcare System, Inc. is a 
130.29 	member of the public employees police and fire retirement plan under sections 353.63 to 
130.30 	353.68 if the person is:
130.31 	(1) certified as a paramedic or emergency medical technician by the state under section 
130.32 	144E.28, subdivision 4;
131.1 	(2) employed full time by Hennepin Healthcare System, Inc. as:
131.2 	(i) a paramedic or;
131.3 	(ii) an emergency medical technician by Hennepin County; or
131.4 	(iii) a supervisor or manager of paramedics or emergency medical technicians; and
131.5 	(3) not eligible for coverage under the agreement signed between the state and the 
131.6 	secretary of the federal Department of Health and Human Services making the provisions 
131.7 	of the federal Old Age, Survivors, and Disability Insurance Act applicable to paramedics 
131.8 	and emergency medical technicians because the person's position is excluded after that date 
131.9 	from application under United States Code, title 42, sections 418(d)(5)(A) and 418(d)(8)(D), 
131.10 	and section 355.07.
131.11 	Hennepin Healthcare System, Inc. shall deduct the employee contribution from the salary 
131.12 	of each full-time paramedic and emergency medical technician it employs as required by 
131.13 	section 353.65, subdivision 2, shall make the employer contribution for each full-time 
131.14 	paramedic and emergency medical technician it employs as required by section 353.65, 
131.15 	subdivision 3, and shall meet the employer recording and reporting requirements in section 
131.16 	353.65, subdivision 4.

131.17 	EFFECTIVE DATE. This section is effective July 1, 2018.

131.18 	Sec. 14. Minnesota Statutes 2016, section 353F.02, subdivision 5a, is amended to read:
131.19 		Subd. 5a.Privatized former public employer. "Privatized former public employer" 
131.20 	means a medical facility that was formerly included in the definition of governmental 
131.21 	subdivision under section 353.01, subdivision 6, on the day before the effective date of 
131.22 	privatization that is privatized and whose employees are certified for participation under 
131.23 	this chapter.

131.24 	EFFECTIVE DATE. This section is effective for privatizations with an effective date 
131.25 	of privatization under Minnesota Statutes, section 353F.02, subdivision 3, after June 30, 
131.26 	2018.

131.27 	Sec. 15. Minnesota Statutes 2016, section 353F.025, subdivision 2, is amended to read:
131.28 		Subd. 2.Reporting privatizations. (a) If the actuarial calculations under subdivision 
131.29 	1, paragraph (c), indicate privatization can be approved because a net gain to the general 
131.30 	employees retirement plan of the Public Employees Retirement Association is expected, or 
131.31 	if paragraph (b) applies, the executive director shall, following acceptance of the actuarial 
132.1 	calculations by the board of trustees, forward notice and supporting documentation, including 
132.2 	a copy of the actuary's report and findings, to the chair and the executive director of the 
132.3 	Legislative Commission on Pensions and Retirement and the chairs and the ranking minority 
132.4 	members of the committees with jurisdiction over governmental operations in the house of 
132.5 	representatives and senate.
132.6 	(b) If the calculations under subdivision 1, paragraph (c), indicate a net loss, the executive 
132.7 	director shall recommend to the board of trustees that the privatization be approved if the 
132.8 	chief clerical officer of the applicable governmental subdivision submits a resolution from 
132.9 	the governing body specifying that a lump sum payment will be made to the Public 
132.10 	Employees Retirement Association equal to the net loss, plus interest. The interest must be 
132.11 	computed using the applicable ultimate preretirement interest rate assumption under section 
132.12 	356.215, subdivision 8, expressed as a monthly rate, from the date of the actuarial valuation 
132.13 	from which the actuarial accrued liability data was used to determine the net loss in the 
132.14 	actuarial study under subdivision 1, to the date of payment, with annual compounding. 
132.15 	Payment must be made on or after the effective date of privatization.
132.16 	(c) The Public Employees Retirement Association must maintain a list that includes the 
132.17 	names of all privatized former public employers in the association's comprehensive annual 
132.18 	financial report and on the association's Web site. Annually by March 1, the association 
132.19 	must submit to the executive director of the Legislative Commission on Pensions and 
132.20 	Retirement the names of any privatized former public employers approved since the 
132.21 	publication of the previous fiscal year's comprehensive annual financial report.

132.22 	EFFECTIVE DATE. This section is effective for privatizations with an effective date 
132.23 	of privatization under Minnesota Statutes, section 353F.02, subdivision 3, after June 30, 
132.24 	2018.

132.25 	Sec. 16. Minnesota Statutes 2016, section 353F.04, subdivision 2, is amended to read:
132.26 		Subd. 2.Exceptions. The increased augmentation rates specified in subdivision 1 do 
132.27 	not apply to a privatized former public employee:
132.28 	(1) beginning the first of the month in which the privatized former public employee 
132.29 	becomes covered again by a retirement plan enumerated in section 356.30, subdivision 3, 
132.30 	if the employee accrues at least six months of credited service in any single plan enumerated 
132.31 	in section 356.30, subdivision 3, except clause (6);
133.1 	(2) beginning the first of the month in which the privatized former public employee 
133.2 	becomes covered again by the general employees retirement plan of the Public Employees 
133.3 	Retirement Association;
133.4 	(3) beginning the first of the month after a privatized former public employee terminates 
133.5 	service with the successor entity privatized former public employer; or
133.6 	(4) if the person begins receipt of a retirement annuity while employed by the employer 
133.7 	which assumed operations of or purchased the privatized former public employer.

133.8 	EFFECTIVE DATE. This section is effective for privatizations with an effective date 
133.9 	of privatization under Minnesota Statutes, section 353F.02, subdivision 3, after June 30, 
133.10 	2018.

133.11 	Sec. 17. Minnesota Statutes 2016, section 353F.05, is amended to read:
133.12 	353F.05 AUTHORIZATION FOR ADDITIONAL ALLOWABLE SERVICE FOR 
133.13 	EARLY RETIREMENT PURPOSES.
133.14 	(a) For the purpose of determining eligibility for early retirement benefits provided under 
133.15 	section 353.30, subdivision 1a, of the edition of Minnesota Statutes published in the year 
133.16 	before the year in which the privatization occurred, and notwithstanding any provision of 
133.17 	chapter 353, to the contrary, the years of allowable service for a privatized former public 
133.18 	employee who transfers employment on the effective date of privatization and does not 
133.19 	apply for a refund of contributions under section 353.34, subdivision 1, of the edition of 
133.20 	Minnesota Statutes published in the year before the year in which the privatization occurred, 
133.21 	or any similar provision, includes service with the successor employer to the privatized 
133.22 	former public employer following the effective date. The successorprivatized former public 
133.23 	employer shall provide any reports that the executive director of the Public Employees 
133.24 	Retirement Association may reasonably request to permit calculation of benefits.
133.25 	(b) To be eligible for early retirement benefits under this section, the individual must 
133.26 	separate from service with the successor to the privatized former public employer. The 
133.27 	privatized former public employee, or an individual authorized to act on behalf of that 
133.28 	employee, may apply for an annuity following application procedures under section 353.29, 
133.29 	subdivision 4.

133.30 	EFFECTIVE DATE. This section is effective for privatizations with an effective date 
133.31 	of privatization under Minnesota Statutes, section 353F.02, subdivision 3, after June 30, 
133.32 	2018.

134.1 	Sec. 18. Minnesota Statutes 2016, section 353F.057, is amended to read:
134.2 	353F.057 TERMINATION FROM SERVICE REQUIREMENT.
134.3 	Upon termination of service from the privatized former public employer or any successor 
134.4 	entity after the effective date of privatization, a privatized former public employee must 
134.5 	separate from any employment relationship with the privatized former public employer or 
134.6 	any successor entity for at least 30 days to qualify to receive a retirement annuity under this 
134.7 	chapter.

134.8 	EFFECTIVE DATE. This section is effective for privatizations with an effective date 
134.9 	of privatization under Minnesota Statutes, section 353F.02, subdivision 3, after June 30, 
134.10 	2018.

134.11 	Sec. 19. Minnesota Statutes 2016, section 353F.06, is amended to read:
134.12 	353F.06 APPLICATION OF REEMPLOYED ANNUITANT EARNINGS 
134.13 	LIMITATIONS.
134.14 	If a privatized former public employee satisfies the separation from service requirement 
134.15 	in section 353F.057 and thereafter resumes employment with the privatized former public 
134.16 	employer or any successor entity or a governmental subdivision under section 353.01, 
134.17 	subdivision 6, the reemployed annuitant earnings limitations of section 353.37 apply.

134.18 	EFFECTIVE DATE. This section is effective for privatizations with an effective date 
134.19 	of privatization under Minnesota Statutes, section 353F.02, subdivision 3, after June 30, 
134.20 	2018.

134.21 	Sec. 20. Minnesota Statutes 2016, section 353F.07, is amended to read:
134.22 	353F.07 EFFECT ON REFUND.
134.23 	Notwithstanding any provision of chapter 353 to the contrary, privatized former public 
134.24 	employees may receive a refund of employee accumulated contributions plus interest as 
134.25 	provided in section 353.34, subdivision 2, at any time after the transfer of employment to 
134.26 	the successor employer of the privatized former public employer. If a privatized former 
134.27 	public employee has received a refund from a pension plan listed in section 356.30, 
134.28 	subdivision 3, the person may not repay that refund unless the person again becomes a 
134.29 	member of one of those listed plans and complies with section 356.30, subdivision 2.

135.1 	EFFECTIVE DATE. This section is effective for privatizations with an effective date 
135.2 	of privatization under Minnesota Statutes, section 353F.02, subdivision 3, after June 30, 
135.3 	2018.

135.4 	Sec. 21. [353F.09] APPLICATION TO SALES OF PRIVATIZED FORMER PUBLIC 
135.5 	EMPLOYERS.
135.6 	A medical facility or other employing unit shall cease to be a privatized former public 
135.7 	employer and its employees shall cease to be considered privatized former public employees 
135.8 	under this chapter upon the sale of the operations of the medical facility or employing unit 
135.9 	to another employer or the sale of the medical facility or employing unit to another employer. 
135.10 	The privatized former public employees shall be entitled to benefits accrued under this 
135.11 	chapter to the date of the sale, but shall not accrue additional benefits after the date of the 
135.12 	sale.

135.13 	EFFECTIVE DATE. The section is effective for privatizations with an effective date 
135.14 	of privatization under Minnesota Statutes, section 353F.02, subdivision 3, after June 30, 
135.15 	2018, and for sales of privatized former public employers after June 30, 2018.

135.16 	Sec. 22.  REPEALER.
 135.17 	Minnesota Statutes 2016, section 353.0161, is repealed.

135.18 	EFFECTIVE DATE. This section is effective July 1, 2018.

135.19 	ARTICLE 11
135.20 	TEACHERS RETIREMENT ASSOCIATION
135.21 	ADMINISTRATIVE PROVISIONS

135.22 	Section 1. Minnesota Statutes 2016, section 354.05, subdivision 2, is amended to read:
135.23 		Subd. 2.Teacher. (a) "Teacher" means:
135.24 	(1) a person who renders service as a teacher, supervisor, principal, superintendent, 
135.25 	librarian, nurse, counselor, social worker, therapist, or psychologist in:
135.26 	(i) a public school of the state other than in Independent School District No. 625 or in 
135.27 	Independent School District No. 709, or in any;
135.28 	(ii) a charter school, irrespective of the location of the school, or in any;
135.29 	(iii) a charitable, penal, or correctional institutionsinstitution of a governmental 
135.30 	subdivision,; or
136.1 	(iv) the Perpich Center for Arts Education, except that any employee of the Perpich 
136.2 	Center for Arts Education who was covered by the Minnesota State Retirement System 
136.3 	general state employees retirement plan as of July 1, 2016, shall continue to be covered by 
136.4 	that plan and not by the Teachers Retirement Association;
136.5 	(2) a person who is engaged in educational administration in connection with the state 
136.6 	public school system, whether the position be a public office or anas employment;
136.7 	(3) a person who renders service as a charter school director or chief administrative 
136.8 	officer; provided, however, that if the charter school director or chief administrative officer 
136.9 	is covered by the Public Employees Retirement Association general employees retirement 
136.10 	plan on July 1, 2017, the charter school director or chief administrative officer shall continue 
136.11 	to be covered by that plan and not by the Teachers Retirement Association;
136.12 	(2)(4) an employee of the Teachers Retirement Association;
136.13 	(3)(5) a person who renders teaching service on a part-time basis and who also renders 
136.14 	other services for a single employing unit where the teaching service comprises at least 50 
136.15 	percent of the combined employment salary is a member of the association for all services 
136.16 	with the single employing unit or, if less than 50 percent of the combined employment 
136.17 	salary, the executive director determines all of the combined service is covered by the 
136.18 	association; or
136.19 	(4)(6) a person who is not covered by the plans established under chapter 352D, 354A, 
136.20 	or 354B and who is employed by the Board of Trustees of the Minnesota State Colleges 
136.21 	and Universities system in an unclassified position as:
136.22 	(i) a president, vice-president, or dean;
136.23 	(ii) a manager or a professional in an academic or an academic support program other 
136.24 	than specified in item (i);
136.25 	(iii) an administrative or a service support faculty position; or
136.26 	(iv) a teacher or a research assistant.
136.27 	(b) "Teacher" does not mean:
136.28 	(1) a person who works for a school or institution as an independent contractor as defined 
136.29 	by the Internal Revenue Service;
136.30 	(2) a person who renders part-time teaching service or who is a customized trainer as 
136.31 	defined by the Minnesota State Colleges and Universities system if (i) the service is incidental 
136.32 	to the regular nonteaching occupation of the person; and (ii) the employer stipulates annually 
137.1 	in advance that the part-time teaching service or customized training service will not exceed 
137.2 	300 hours in a fiscal year and retains the stipulation in its records; and (iii) the part-time 
137.3 	teaching service or customized training service actually does not exceed 300 hours in a 
137.4 	fiscal year;
137.5 	(3) a person exempt from licensure under section 122A.30;
137.6 	(4)(2) annuitants of the teachers retirement plan who are employed after retirement by 
137.7 	an employing unit that participates in the teachers retirement plan during the course of that 
137.8 	reemployment;
137.9 	(5)(3) a person who is employed by the University of Minnesota;
137.10 	(6)(4) a member or an officer of any general governing or managing board or body of 
137.11 	an employing unit that participates in the teachers retirement plan; or
137.12 	(7)(5) a person employed by Independent School District No. 625 or Independent School 
137.13 	District No. 709 as a teacher as defined in section 354A.011, subdivision 27.

137.14 	EFFECTIVE DATE. This section is effective July 1, 2018.

137.15 	Sec. 2. Minnesota Statutes 2016, section 354.05, is amended by adding a subdivision to 
137.16 	read:
137.17 		Subd. 17a.Former spouse. "Former spouse" means a person who is no longer a spouse 
137.18 	of a member due to dissolution of the marriage, legal separation, or annulment.

137.19 	EFFECTIVE DATE. This section is effective July 1, 2018.

137.20 	Sec. 3. Minnesota Statutes 2016, section 354.06, subdivision 2, is amended to read:
137.21 		Subd. 2.President; executive director. The board shall annually elect one of its members 
137.22 	as president. It shall elect an executive director. Notwithstanding any law to the contrary, 
137.23 	the board must set the salary of the executive director. The salary of the executive director 
137.24 	must not exceed the limit for a position listed in section 15A.0815, subdivision 2. The salary 
137.25 	of the assistant executive director who shall be in the unclassified service, shall be set in 
137.26 	accordance with section 43A.18, subdivision 3. The executive director shall serve during 
137.27 	the pleasure of the board and be the executive officer of the board, with such duties as the 
137.28 	board shall prescribe. The board shall employ all other clerks and employees necessary to 
137.29 	properly administer the association. The cost and expense of administering the provisions 
137.30 	of this chapter shall be paid by the association. The board shall appoint an executive director 
137.31 	shall be appointed by the board on the basis of fitness education, experience in the retirement 
138.1 	field and leadership, ability to manage and lead system staff, and ability to assist the board 
138.2 	in setting a vision for the system. The executive director shall have had at least five years 
138.3 	of experience on the administrative staff of a major retirement system.

138.4 	EFFECTIVE DATE. This section is effective July 1, 2018.

138.5 	Sec. 4. Minnesota Statutes 2016, section 354.06, subdivision 2a, is amended to read:
138.6 		Subd. 2a.Duties of executive director. The management of the association is vested 
138.7 	in the executive director who shall be the executive and administrative head of the 
138.8 	association. The executive director shall act as advisor to the board on all matters pertaining 
138.9 	to the association and shall also act as the secretary of the board. The executive director 
138.10 	shall:
138.11 	(1) attend all meetings of the board;
138.12 	(2) prepare and recommend to the board appropriate rules to carry out the provisions of 
138.13 	this chapter;
138.14 	(3) establish and maintain an adequate system of records and accounts following 
138.15 	recognized accounting principles and controls;
138.16 	(4) designate, as necessary, a deputy executive director and an assistant executive director 
138.17 	in the unclassified service, as defined in section 43A.08, whose salaries shall be set in 
138.18 	accordance with section 43A.18, subdivision 3, and two assistant executive directors in the 
138.19 	classified service, as defined in section 43A.07, with the approval of the board, and appoint 
138.20 	such employees, both permanent and temporary, as are necessary to carry out the provisions 
138.21 	of this chapter;
138.22 	(5) organize the work of the association as the director deems necessary to fulfill the 
138.23 	functions of the association, and define the duties of its employees and delegate to them 
138.24 	any powers or duties, subject to the director's control and under such conditions as the 
138.25 	director may prescribe;
138.26 	(6) with the approval of the board, contract and set the compensation for the services of 
138.27 	an approved actuary, professional management services, and any other consulting services. 
138.28 	These contracts are not subject to the competitive bidding procedure prescribed by chapter 
138.29 	16C. An approved actuary retained by the executive director shall function as the actuarial 
138.30 	advisor of the board and the executive director and may perform actuarial valuations and 
138.31 	experience studies to supplement those performed by the actuary retained under section 
138.32 	356.214. Any supplemental actuarial valuations or experience studies shall be filed with 
138.33 	the executive director of the Legislative Commission on Pensions and Retirement. Copies 
139.1 	of professional management survey reports must be transmitted to the secretary of the senate, 
139.2 	the chief clerk of the house of representatives, and the Legislative Reference Library as 
139.3 	provided by section 3.195, and to the executive director of the commission at the same time 
139.4 	as reports are furnished to the board. Only management firms experienced in conducting 
139.5 	management surveys of federal, state, or local public retirement systems are qualified to 
139.6 	contract with the executive director;
139.7 	(7) with the approval of the board, provide in-service training for the employees of the 
139.8 	association;
139.9 	(8) make refunds of accumulated contributions to former members and to the designated 
139.10 	beneficiary, surviving spouse, legal representative, or next of kin of deceased members or 
139.11 	deceased former members, under this chapter;
139.12 	(9) determine the amount of the annuities and disability benefits of members covered 
139.13 	by the association and authorize payment of the annuities and benefits beginning as of the 
139.14 	dates on which the annuities and benefits begin to accrue, under this chapter;
139.15 	(10) pay annuities, refunds, survivor benefits, salaries, and necessary operating expenses 
139.16 	of the association;
139.17 	(11) prepare and submit to the board and the legislature an annual financial report 
139.18 	covering the operation of the association, as required by section 356.20;
139.19 	(12) certify funds available for investment to the State Board of Investment;
139.20 	(13) with the advice and approval of the board, request the State Board of Investment 
139.21 	to sell securities on determining that funds are needed for the purposes of the association;
139.22 	(14) prepare and submit biennial and annual budgets to the board and with the approval 
139.23 	of the board submit those budgets to the Department of Management and Budget; and
139.24 	(15) with the approval of the board, perform such other duties as may be required for 
139.25 	the administration of the association and the other provisions of this chapter and for the 
139.26 	transaction of its business. The executive director may:
139.27 	(i) reduce all or part of the accrued interest and fines payable by an employing unit for 
139.28 	reporting requirements under section 354.52 this chapter, based on an evaluation of any 
139.29 	extenuating circumstances of the employing unit;
139.30 	(ii) assign association employees to conduct field audits of an employing unit to ensure 
139.31 	compliance with the provisions of this chapter; and
140.1 	(iii) recover overpayments, if not repaid to the association, by suspending or reducing 
140.2 	the payment of a retirement annuity, refund, disability benefit, survivor benefit, or optional 
140.3 	annuity under this chapter until the overpayment, plus interest, has been recovered.

140.4 	EFFECTIVE DATE. This section is effective July 1, 2018.

140.5 	Sec. 5. Minnesota Statutes 2016, section 354.095, is amended to read:
140.6 	354.095 MEDICAL LEAVE.
140.7 	(a) Upon granting a medical leave, an employing unit must certify the leave to the 
140.8 	association on a form specified by the executive director. A member of the association who 
140.9 	is on an authorized medical leave of absence is entitled to receive allowable service credit, 
140.10 	not to exceed one year five years, for the period of leave, upon making the prescribed 
140.11 	payment to the fund under section 354.72. A member may not receive more than one year 
140.12 	of allowable service credit during any fiscal year by making payment under this section. A 
140.13 	member may not receive disability benefits under section 354.48 and receive allowable 
140.14 	service credit under this section for the same period of time.
140.15 	(b) The executive director shall reject an application for disability benefits under section 
140.16 	354.48 if the member is applying only because an employer-sponsored provider of private 
140.17 	disability insurance benefits requires the application and the member would not have applied 
140.18 	for disability benefits in the absence of the requirement. The member shall submit a copy 
140.19 	of the disability insurance policy that requires an application for disability benefits from 
140.20 	the plan if the member wishes to assert that the application is only being submitted because 
140.21 	of the disability insurance policy requirement.
140.22 	(c) Notwithstanding the provisions of any agreement to the contrary, employee and 
140.23 	employer contributions may not be made to receive allowable service credit under this 
140.24 	section if the member does not retain the right to full reinstatement both during and at the 
140.25 	end of the medical leave.

140.26 	EFFECTIVE DATE. Paragraphs (a) and (c) are effective July 1, 2019. Paragraph (b) 
140.27 	is effective retroactively from July 1, 2016.

140.28 	Sec. 6. Minnesota Statutes 2016, section 354.44, subdivision 3, is amended to read:
140.29 		Subd. 3.Application for retirement. A member or a person authorized to act on behalf 
140.30 	of the member may make application for retirement provided the age and service 
140.31 	requirements under subdivision 1 are satisfied on or before the member's retirement annuity 
140.32 	accrual date under subdivision 4. The application may be made no earlier than 120180 days 
141.1 	before the termination of teaching service. The application must be made on a form prescribed 
141.2 	by the executive director and is not complete until all necessary supporting documents are 
141.3 	received by the executive director.

141.4 	EFFECTIVE DATE. This section is effective July 1, 2019.

141.5 	Sec. 7. Minnesota Statutes 2016, section 354.44, subdivision 9, is amended to read:
141.6 		Subd. 9.Determining applicable law. A former teacher who returns to covered service 
141.7 	following a termination and who is not receiving a retirement annuity under this section 
141.8 	must have earned at least 85 daysone-half year of credited service following the return to 
141.9 	covered service to be eligible for improved benefits resulting from any law change enacted 
141.10 	subsequent to that termination.

141.11 	EFFECTIVE DATE. This section is effective July 1, 2018.

141.12 	Sec. 8. Minnesota Statutes 2016, section 354.45, is amended by adding a subdivision to 
141.13 	read:
141.14 		Subd. 3.Payment upon death of former spouse. Upon the death of the former spouse 
141.15 	to whom payments are to be made before the end of the specified payment period, payments 
141.16 	shall be made according to the terms of a beneficiary form completed by the former spouse 
141.17 	or, if no beneficiary form, to the estate of the former spouse or as otherwise ordered by a 
141.18 	court of competent jurisdiction.

141.19 	EFFECTIVE DATE. This section is effective July 1, 2018.

141.20 	Sec. 9. Minnesota Statutes 2016, section 354.46, subdivision 6, is amended to read:
141.21 		Subd. 6.Application. (a) A beneficiary designation and an application for benefits under 
141.22 	this section must be in writing on a form prescribed by the executive director.
141.23 	(b) Sections 354.55, subdivision 11, and 354.60 apply to a deferred annuity payable 
141.24 	under this section.
141.25 	(c) Unless otherwise specified, the annuity must be computed under section 354.44, 
141.26 	subdivision 2 or 6, whichever is applicable.
141.27 	(d) Each designated beneficiary eligible for a lifetime benefit under this subdivision may 
141.28 	apply for an annuity any time after the member's death. The benefit may not begin to accrue 
141.29 	more than six months before the date the application is filed with the executive director and 
141.30 	may not accrue before the member's death.

142.1 	EFFECTIVE DATE. This section is effective July 1, 2018.

142.2 	Sec. 10. Minnesota Statutes 2016, section 354.48, subdivision 1, is amended to read:
142.3 		Subdivision 1.Age, service and salary requirements. A member who is totally and 
142.4 	permanently disabled, who has not reached the normal retirement age as defined in section 
142.5 	354.05, subdivision 38, and who has at least three years of credited allowable service at the 
142.6 	time that the total and permanent disability begins is entitled to a disability benefit based 
142.7 	on this allowable service in an amount provided in subdivision 3. If the disabled member's 
142.8 	teaching service has terminated at any time, at least two of the required three years of 
142.9 	allowable service must have been rendered after last becoming a member. Any member 
142.10 	whose average salary is less than $75 per month is not entitled to disability benefits.

142.11 	EFFECTIVE DATE. This section is effective July 1, 2018.

142.12 	Sec. 11. Minnesota Statutes 2016, section 354.512, is amended to read:
142.13 	354.512 RECOVERY OF DEFICIENCIES.
142.14 	In addition to any other remedies permitted under law, if an employing unit or other 
142.15 	entity required by law to make any form of payment to the Teachers Retirement Association 
142.16 	fails to make full payment within 60 days of notification, the executive director is authorized 
142.17 	to certify the amount of deficiency to the commissioner of management and budget, who 
142.18 	shall deduct the amount from any state aid or appropriation applicable to the employing 
142.19 	unit or entity, and transmit the withheld aid or appropriation to the executive director for 
142.20 	deposit in the fund.

142.21 	EFFECTIVE DATE. This section is effective July 1, 2018.

142.22 	Sec. 12. Minnesota Statutes 2016, section 354.52, subdivision 4, is amended to read:
142.23 		Subd. 4.Reporting and remittance requirements. An employer shall remit all amounts 
142.24 	due to the association and furnish a statement indicating the amount due and transmitted 
142.25 	with any other information required by the executive director. If an amount due is not 
142.26 	received by the association within 14 calendar days of the payroll warrant, the amount 
142.27 	accrues interest at an annual rate of 8.5 percent compounded annually from the due date 
142.28 	until the amount is received by the association. All amounts due and other employer 
142.29 	obligations not remitted within 60 days of notification by the association mustmay be 
142.30 	certified to the commissioner of management and budget who shall deduct the amount from 
142.31 	any state aid or appropriation amount applicable to the employing unit.

143.1 	EFFECTIVE DATE. This section is effective July 1, 2018.

143.2 	Sec. 13. Minnesota Statutes 2016, section 354.52, subdivision 4d, is amended to read:
143.3 		Subd. 4d.Annual base salary reporting. An employing unit must provide the following
143.4 	annual base salary data, as defined in section 354.05, subdivision 41, to the association on 
143.5 	or before June 30 of each fiscal year: (1) annual base salary, as defined in section 354.05, 
143.6 	subdivision 41; and.
143.7 	(2) beginning and ending dates for the regular school work year.

143.8 	EFFECTIVE DATE. This section is effective the day following final enactment.

143.9 	Sec. 14. Minnesota Statutes 2016, section 354.66, subdivision 2, is amended to read:
143.10 		Subd. 2.Qualified part-time teacher program participation requirements. (a) A 
143.11 	teacher in a Minnesota public elementary school, a Minnesota secondary school, or the 
143.12 	Minnesota State Colleges and Universities system who has three years or more of allowable 
143.13 	service in the association or three years or more of full-time teaching service in Minnesota 
143.14 	public elementary schools, Minnesota secondary schools, or the Minnesota State Colleges 
143.15 	and Universities system, by agreement with the board of the employing district or with the 
143.16 	authorized representative of the board, may be assigned to teaching service in a part-time 
143.17 	teaching position under subdivision 3. The agreement must be executed before October 1 
143.18 	of the school year for which the teacher requests to make retirement contributions under 
143.19 	subdivision 4 has been assigned to teaching service in a part-time teaching position under 
143.20 	this section. A copy of the executed agreement must be filed with the executive director of 
143.21 	the association. If the copy of the executed agreement is filed with the association after 
143.22 	October 1 of the school year for which the teacher requests to make retirement contributions 
143.23 	under subdivision 4 has been assigned to teaching service in a part-time teaching position, 
143.24 	the employing unit shall pay the fine specified in section 354.52, subdivision 6, for each 
143.25 	calendar day that elapsed since the October 1 due date, unless the association waives the 
143.26 	fine. The association may not accept an executed agreement that is received by the association 
143.27 	more than 15 months late. The association may not waive the fine required by this section.
143.28 	(b) Notwithstanding paragraph (a), if the teacher is also a legislator:
143.29 	(1) the agreement in paragraph (a) must be executed before March 1 of the school year 
143.30 	for which the teacher requests to make retirement contributions under subdivision 4; and
143.31 	(2) the fines specified in paragraph (a) apply if the employing unit does not file the 
143.32 	executed agreement with the executive director of the association by March 1.

144.1 	EFFECTIVE DATE. This section is effective July 1, 2018.

144.2 	Sec. 15. Minnesota Statutes 2016, section 354.72, subdivision 1, is amended to read:
144.3 		Subdivision 1.Application. This section applies to any strike period under section 
144.4 	354.05, subdivision 13, clause (6), and to any period of authorized leave of absence without 
144.5 	pay under sections 354.093, 354.094, 354.095, and 354.096 for which the teacher obtains 
144.6 	credit for allowable service by making payment as specified in this section to the Teachers 
144.7 	Retirement Association fund. Each year of an extended leave of absence under section 
144.8 	354.094 is considered to be a separate leave for purposes of this section.

144.9 	EFFECTIVE DATE. This section is effective July 1, 2018.

144.10 	Sec. 16. Minnesota Statutes 2016, section 423A.02, subdivision 3, is amended to read:
144.11 		Subd. 3.Reallocation of amortization state aid. (a) Seventy percent of the difference 
144.12 	between $5,720,000 and the current year amortization aid distributed under subdivision 1 
144.13 	that is not distributed for any reason to a municipality must be distributed by the 
144.14 	commissioner of revenue according to this paragraph. The commissioner shall distribute 
144.15 	60 percent of the amounts derived under this paragraph to the Teachers Retirement 
144.16 	Association, and 40 percent to the St. Paul Teachers Retirement Fund Association to fund 
144.17 	the unfunded actuarial accrued liabilities of the respective funds. These payments must be 
144.18 	made on July 15 each fiscal year. If the St. Paul Teachers Retirement Fund Association or 
144.19 	the Duluth Teachers Retirement Fund Association becomes fully funded, the association's 
144.20 	eligibility for its portion of this aid ceases. Amounts remaining in the undistributed balance 
144.21 	account at the end of the biennium if aid eligibility ceases cancel to the general fund.
144.22 	(b) In order to receive amortization aid under paragraph (a), before June 30 annually 
144.23 	Independent School District No. 625, St. Paul, must make an additional contribution of 
144.24 	$800,000 each year to the St. Paul Teachers Retirement Fund Association.
144.25 	(c) Thirty percent of the difference between $5,720,000 and the current year amortization 
144.26 	aid under subdivision 1 that is not distributed for any reason to a municipality must be 
144.27 	distributed under section 69.021, subdivision 7, paragraph (d), as additional funding to 
144.28 	support a minimum fire state aid amount for volunteer firefighter relief associations.

144.29 	EFFECTIVE DATE. This section is effective July 1, 2018.

145.1 	ARTICLE 12
145.2 	ST. PAUL TEACHERS RETIREMENT FUND ASSOCIATION
145.3 	ADMINISTRATIVE PROVISIONS

145.4 	Section 1. Minnesota Statutes 2016, section 354A.093, subdivision 4, is amended to read:
145.5 		Subd. 4.Eligible payment period. (a) To receive service credit under this section, the 
145.6 	contributions specified in this section must be transmitted to the applicable first class city
145.7 	St. Paul Teachers Retirement Fund Association during the period which begins with the 
145.8 	date the individual returns to teaching service and which has a duration of three times the 
145.9 	length of the uniformed service period, but not to exceed five years.
145.10 	(b) Notwithstanding paragraph (a), if the payment period determined under paragraph 
145.11 	(a) is less than one year, the contributions required under this section to receive service 
145.12 	credit may be made within one year from the discharge date.

145.13 	EFFECTIVE DATE. This section is effective July 1, 2018.

145.14 	Sec. 2. Minnesota Statutes 2016, section 354A.38, is amended to read:
145.15 	354A.38 EFFECT OF REFUND; REPAYMENT OF REFUND.
145.16 		Subdivision 1.Effect of refund; termination of service credit. If a coordinated member 
145.17 	or former coordinated member applies for and acceptsis issued a refund pursuant to section 
145.18 	354A.37, all allowable service which was credited to the member or former member shall 
145.19 	be terminated.
145.20 		Subd. 2.Repayment of refund. A coordinated member with at least two years of 
145.21 	allowable service credited subsequent to the member's last application for and acceptance
145.22 	payment of a refund pursuant to section 354A.37 shall be entitled to repay the refund. The 
145.23 	amount of the refund repayment shall be calculated pursuant to subdivision 3. If the member 
145.24 	has previously applied for and acceptedtaken more than one refund, and the previous refund 
145.25 	orall refunds have not beenmust be repaid, then the member shall be entitled only to repay 
145.26 	all outstanding refunds and shall not be entitled to repay only the most recent refund pro 
145.27 	rata.
145.28 		Subd. 3.Computation of refund repayment amount. If the coordinated member elects 
145.29 	to repay a refund under subdivision 2, the repayment to the fund must be in an amount equal 
145.30 	to refunds the member has acceptedbeen issued plus interest at the rate of 8.5 percent until 
145.31 	June 30, 2015, and eight percent thereafterapplicable annual rate or rates specified in section 
146.1 	356.59, subdivision 5, compounded annually, from the date that the refund was accepted
146.2 	issued to the date that the refund is repaid.

146.3 	EFFECTIVE DATE. This section is effective July 1, 2018.

146.4 	ARTICLE 13
146.5 	RETIREMENT SYSTEMS, GENERALLY
146.6 	ADMINISTRATIVE PROVISIONS

146.7 	Section 1. Minnesota Statutes 2016, section 356.32, subdivision 2, is amended to read:
146.8 		Subd. 2.Covered retirement plans. The provisions of this section apply to the following 
146.9 	retirement plans:
146.10 	(1) the general state employees retirement plan of the Minnesota State Retirement System, 
146.11 	established under chapter 352;
146.12 	(2) the correctional state employees retirement plan of the Minnesota State Retirement 
146.13 	System, established under chapter 352;
146.14 	(3) the State Patrol retirement plan, established under chapter 352B;
146.15 	(4) the general employees retirement plan of the Public Employees Retirement 
146.16 	Association, established under chapter 353;
146.17 	(5) the public employees police and fire plan of the Public Employees Retirement 
146.18 	Association, established under chapter 353;
146.19 	(6) the local government correctional service retirement plan of the Public Employees 
146.20 	Retirement Association, established under chapter 353E;
146.21 	(7) the Teachers Retirement Association, established under chapter 354; and
146.22 	(7)(8) the St. Paul Teachers Retirement Fund Association, established under chapter 
146.23 	354A.

146.24 	EFFECTIVE DATE. This section is effective July 1, 2018.

146.25 	Sec. 2. Minnesota Statutes 2016, section 356.47, subdivision 3, is amended to read:
146.26 		Subd. 3.Payment. (a) Beginning one year after the reemployment withholding period 
146.27 	ends relating to the reemployment that gave rise to the limitation, and the filing of a written 
146.28 	application, the retired member is entitled to the payment, in a lump sum, of the value of 
146.29 	the person's amount under subdivision 2, plus annual compound interest. For the general 
146.30 	state employees retirement plan, the correctional state employees retirement plan, the general 
147.1 	employees retirement plan of the Public Employees Retirement Association, the public 
147.2 	employees police and fire retirement plan, the local government correctional employees 
147.3 	retirement plan, and the teachers retirement plan, the annual interest rate is six percent from 
147.4 	the date on which the amount was deducted from the retirement annuity to the date of 
147.5 	payment or until January 1, 2011, whichever is earlier, and no interest after January 1, 2011. 
147.6 	For the St. Paul Teachers Retirement Fund Association, the annual interest is the rate of six 
147.7 	percent from the date that the amount was deducted from the retirement annuity to the date 
147.8 	of payment or June 30, 2011, whichever is earlier, and with no interest accrual after June 
147.9 	30, 2011.
147.10 	(b) The written application must be on a form prescribed by the chief administrative 
147.11 	officer of the applicable retirement plan.
147.12 	(c) If the retired member dies before the payment provided for in paragraph (a) is made, 
147.13 	the amount is payable, upon written application, to the deceased person's surviving spouse, 
147.14 	or if none, to the deceased person's designated beneficiary, or if none, to the deceased 
147.15 	person's estate.
147.16 	(d) If the amount under subdivision 2 is an eligible rollover distribution as defined in 
147.17 	section 356.635, subdivisions 4 and 5, the applicable retirement plan shall provide notice 
147.18 	and an election:
147.19 	(1) to the member regarding the member's right to elect a direct rollover under section 
147.20 	356.635, subdivisions 3 to 7, in lieu of thea direct payment of the person's amount under 
147.21 	subdivision 2, on or after the payment date under paragraph (a), if the federal Internal 
147.22 	Revenue Code so permits, the retired member may elect to have all or any portion of the 
147.23 	payment amount under this section paid in the form of a direct rollover to an eligible 
147.24 	retirement plan as defined in section 402(c) of the federal Internal Revenue Code that is 
147.25 	specified by the retired member. If the retired member dies with a balance remaining payable 
147.26 	under this section, the surviving spouse of the retired member, or if none, the deceased 
147.27 	person's designated beneficiary, or if none, the administrator of the deceased person's estate 
147.28 	may elect a direct rollover under this paragraph.; or
147.29 	(2) if paragraph (c) applies and the amount is to be paid to a person who is a distributee 
147.30 	as defined in section 356.635, subdivision 7, to the distributee regarding the distributee's 
147.31 	right to elect a direct rollover under section 356.635, subdivisions 3 to 7, in lieu of a direct 
147.32 	payment.

147.33 	EFFECTIVE DATE. This section is effective July 1, 2018.

148.1 	Sec. 3. Minnesota Statutes 2016, section 356.635, is amended by adding a subdivision to 
148.2 	read:
148.3 		Subd. 9a.Definitions. (a) The following definitions apply for purposes of this subdivision 
148.4 	and subdivisions 10 to 12.
148.5 	(b) "Annual addition" means the sum for the limitation year of all pretax and after-tax 
148.6 	contributions made by the member or the member's employer and credited to an account in 
148.7 	the name of the member in any defined contribution plan maintained by the employer.
148.8 	(c) "Compensation" means the compensation actually paid or made available to a member 
148.9 	for any limitation year, including all items of remuneration described in Code of Federal 
148.10 	Regulations, title 26, section 1.415(c)-2(b), and excluding all items of remuneration described 
148.11 	in Code of Federal Regulations, title 26, section 1.415(c)-2(c). Compensation for pension 
148.12 	plan purposes for any limitation year shall not exceed the applicable federal compensation 
148.13 	limit described in section 356.611, subdivision 2.
148.14 	(d) "Limitation year" means the calendar year or fiscal year, whichever is applicable to 
148.15 	the particular pension plan.
148.16 	(e) "Maximum permissible benefit" means an annual benefit of $160,000, automatically 
148.17 	adjusted under section 415(d) of the Internal Revenue Code for each limitation year ending 
148.18 	after December 31, 2001, payable in the form of a single life annuity. The new limitation 
148.19 	shall apply to limitation years ending with or within the calendar year of the date of the 
148.20 	adjustment, but a member's benefits shall not reflect the adjusted limit prior to January 1 of 
148.21 	that calendar year. The maximum permissible benefit amount shall be further adjusted as 
148.22 	follows:
148.23 	(1) if the member has less than ten years of participation, the maximum permissible 
148.24 	benefit shall be multiplied by a fraction, the numerator of which is the number of years, or 
148.25 	part thereof, but not less than one year, of participation in the plan, and the denominator of 
148.26 	which is ten;
148.27 	(2) if the annual benefit begins before the member has attained age 62, the determination 
148.28 	as to whether the maximum permissible benefit limit has been satisfied shall be made, in 
148.29 	accordance with regulations prescribed by the United States secretary of the treasury, by 
148.30 	reducing the limit so that the limit, as so reduced, equals an annual benefit, beginning when 
148.31 	the annual benefit actually begins, which is equivalent to a $160,000, as adjusted, annual 
148.32 	benefit beginning at age 62; and
149.1 	(3) if the annual benefit begins after the member has attained age 65, the determination 
149.2 	as to whether the maximum permissible benefit limit has been satisfied shall be made, in 
149.3 	accordance with regulations prescribed by the United States secretary of the treasury, by 
149.4 	increasing the limit so that the limit, as so increased, equals an annual benefit, beginning 
149.5 	when the annual benefit actually begins, which is equivalent to a $160,000, as adjusted, 
149.6 	annual benefit beginning at age 65.

149.7 	EFFECTIVE DATE. This section is effective July 1, 2018.

149.8 	Sec. 4. Minnesota Statutes 2016, section 356.635, subdivision 10, is amended to read:
149.9 		Subd. 10.Annual benefit limitations; defined benefit plans. (a) The annual benefit 
149.10 	payable to a member shall not exceed the maximum permissible benefit. If the benefit the 
149.11 	member would otherwise receive for a limitation year would result in the payment of an 
149.12 	annual benefit in excess of the maximum permissible benefit, the benefit shall be reduced 
149.13 	to the extent necessary so the benefit does not exceed the maximum permissible benefit.
149.14 	(b) For purposes of applying the limits of section 415(b) of the Internal Revenue Code, 
149.15 	a retirementlimitation in paragraph (a), an annual benefit that is payable in any form other 
149.16 	than a single life annuity and that is subject to section 417(e)(3) of the Internal Revenue 
149.17 	Code mustshall be adjusted to an actuarially equivalent single life annuity that equals, if 
149.18 	the annuity starting date is in a plan year beginning after 2005, the annual amount of the 
149.19 	single life annuity commencing at the same annuity starting date that has the same actuarial 
149.20 	present value as the participant'smember's form of benefit, using whichever of the following 
149.21 	produces the greatest annual amount:
149.22 	(1) the interest rate and the mortality table or other tabular factor specified in the plan 
149.23 	for adjusting benefits in the same form;
149.24 	(2) a 5.5 percent interest rate assumption and the applicable mortality table; or
149.25 	(3) the applicable interest rate under section 417(e)(3) of the Internal Revenue Code and 
149.26 	the applicable mortality table, divided by 1.05.
149.27 	(c) If a member participated in more than one pension plan in which the employer 
149.28 	participates, the benefits under each plan must be reduced proportionately to satisfy the 
149.29 	limitation in paragraph (a).

149.30 	EFFECTIVE DATE. This section is effective July 1, 2018.

150.1 	Sec. 5. Minnesota Statutes 2016, section 356.635, is amended by adding a subdivision to 
150.2 	read:
150.3 		Subd. 11.Annual addition limitation; defined contribution plans. The annual additions 
150.4 	by or on behalf of a member to a defined contribution plan for any limitation year shall not 
150.5 	exceed the lesser of (1) 100 percent of the member's compensation for the limitation year 
150.6 	or (2) the dollar limit in effect for the limitation year under section 415(c)(1)(A) of the 
150.7 	Internal Revenue Code, as adjusted by the United States secretary of the treasury under 
150.8 	section 415(d)(1)(C) of the Internal Revenue Code.

150.9 	EFFECTIVE DATE. This section is effective July 1, 2018.

150.10 	Sec. 6. Minnesota Statutes 2016, section 356.635, is amended by adding a subdivision to 
150.11 	read:
150.12 		Subd. 12.Incorporation by reference. Any requirements of section 415(b) and (c) of 
150.13 	the Internal Revenue Code and related regulations and agency guidance not addressed by 
150.14 	subdivisions 10 and 11 shall be considered incorporated by reference, including provisions 
150.15 	applicable to qualified police and firefighters and to survivor and disability benefits. 
150.16 	Subdivisions 10 to 12 shall be interpreted in a manner that is consistent with the requirements 
150.17 	of section 415(b) and (c) of the Internal Revenue Code and the related regulations.

150.18 	EFFECTIVE DATE. This section is effective July 1, 2018.

150.19 	Sec. 7. Minnesota Statutes 2016, section 356.635, is amended by adding a subdivision to 
150.20 	read:
150.21 		Subd. 13.Correction of errors. The executive director of each plan may correct an 
150.22 	operational, demographic, employer eligibility, or plan document error as the executive 
150.23 	director deems necessary or appropriate to preserve and protect the plan's tax qualification 
150.24 	under section 401(a) of the Internal Revenue Code, including as provided in the Internal 
150.25 	Revenue Service's Employee Plans Compliance Resolution System (EPCRS) or any successor 
150.26 	thereto. To the extent deemed necessary by the executive director to implement correction, 
150.27 	the executive director may:
150.28 	(1) make distributions;
150.29 	(2) transfer assets; or
150.30 	(3) recover an overpayment by reducing future benefit payments or designating 
150.31 	appropriate revenue or source of funding that will restore to the plan the amount of the 
150.32 	overpayment.

151.1 	EFFECTIVE DATE. This section is effective July 1, 2018.

151.2 	Sec. 8. Minnesota Statutes 2016, section 356.96, subdivision 1, is amended to read:
151.3 		Subdivision 1.Definitions. (a) Unless the language or context clearly indicates that a 
151.4 	different meaning is intended, for the purpose of this section, the terms in paragraphs (b) 
151.5 	to (e)this subdivision have the meanings given them.
151.6 	(b) "Chief administrative officer""Executive director" means the executive director of 
151.7 	a covered pension plan or the executive director's designee or representative.
151.8 	(c) "Covered pension plan" means a plan enumerated in section 356.20, subdivision 2, 
151.9 	clauses (1) to (4), (8), and (11) to (14), but does not mean the deferred compensation plan 
151.10 	administered under sections 352.965 and 352.97 or to the postretirement health care savings 
151.11 	plan administered under section 352.98.
151.12 	(d) "Governing board" means the Board of Trustees of the Public Employees Retirement 
151.13 	Association, the Board of Trustees of the Teachers Retirement Association, or the Board 
151.14 	of Directors of the Minnesota State Retirement System.
151.15 	(e) "Person" includesmeans an active, retired, deferred, or nonvested inactive participant 
151.16 	in a covered pension plan or a beneficiary of a participant, or an individual who has applied 
151.17 	to be a participant or who is or may be a survivor of a participant, or the representative of 
151.18 	a state agency or other governmental unit that employs active participants in a covered 
151.19 	pension plan.
151.20 	(f) "Petitioner" means a person who has filed a petition for review of an executive 
151.21 	director's determination under this section.

151.22 	EFFECTIVE DATE. This section is effective the day following final enactment.

151.23 	Sec. 9. Minnesota Statutes 2016, section 356.96, subdivision 2, is amended to read:
151.24 		Subd. 2.Right to review appeal to executive director; determination. A determination 
151.25 	made by the chief administrative officerperson may appeal a decision by the staff of a 
151.26 	covered pension plan regarding athe person's eligibility, benefits, or other rights under the 
151.27 	plan with which the person does not agree to the executive director of the plan. The appeal 
151.28 	must be in writing and be delivered to the executive director. The executive director may 
151.29 	overturn, modify, or affirm the staff's decision. The executive director's determination is 
151.30 	subject to review under this section.

151.31 	EFFECTIVE DATE. This section is effective the day following final enactment.

152.1 	Sec. 10. Minnesota Statutes 2016, section 356.96, subdivision 3, is amended to read:
152.2 		Subd. 3.Notice of determination. If the applicable chief administrative officer denies 
152.3 	an application or a written request, modifies a benefit, or terminates a benefit of a person 
152.4 	claiming a right or potential rights under a covered pension plan, the chief administrative 
152.5 	officer shall notify that person through a written notice containing: The executive director 
152.6 	shall issue a written notice of determination to the person who files an appeal under 
152.7 	subdivision 2. The notice of determination must be delivered by certified mail to the address 
152.8 	to which the most recent benefit payment was sent or, if that address is that of a financial 
152.9 	institution, to the last known address of the person. The notice of determination shall include 
152.10 	the following:
152.11 	(1) a statement of the reasons for the determination;
152.12 	(2) a noticestatement that the person may petition the governing board of the covered 
152.13 	pension plan for a review of the determination and that a person's petition for review must 
152.14 	be filed in the administrative office of the covered pension plan withinno later than 60 days 
152.15 	of the receiptafter the date of the written notice of the determination;
152.16 	(3) a statement indicating that a failure to petition for review within 60 days precludes 
152.17 	the person from contesting in any otherfurther administrative or judicial review or court 
152.18 	procedure the issues determined by the chief administrative officer of the executive director's 
152.19 	determination;
152.20 	(4) a statement indicating that all relevant materials, documents, affidavits, and other 
152.21 	records that the person wishes to be reviewed in support of the petition and a list of any 
152.22 	witnesses who will testify before the governing board, along with a summary of the witness' 
152.23 	testimony, must be filed with and received in the administrative office of the covered pension 
152.24 	plan at least 15 days before the date of the hearing under subdivision 10 or as directed by 
152.25 	the administrative law judge who conducts a fact-finding conference under subdivision 7, 
152.26 	paragraph (b), or a contested case hearing under subdivision 12, paragraph (b); and
152.27 	(5) a summary of this section, including all filing requirements and deadlines.; and
152.28 	(6) the statement required under subdivision 4, paragraph (a), if applicable.

152.29 	EFFECTIVE DATE. This section is effective the day following final enactment.

152.30 	Sec. 11. Minnesota Statutes 2016, section 356.96, subdivision 4, is amended to read:
152.31 		Subd. 4.Termination of benefits. (a) If a covered pension plan decides tothe executive 
152.32 	director's determination will terminate a benefit that is being paid to a person, before 
153.1 	terminating the benefit, the chief administrative officer must, in addition to the other 
153.2 	procedures prescribed in this section, provide the individual with written notice of the 
153.3 	pending benefit termination by certified mail. The notice must explain the reason for the 
153.4 	pending benefit termination. The person must be given anthe notice of determination must 
153.5 	also state that the person has the opportunity to explain, in writing, in person, by telephone, 
153.6 	or by e-mail, the reasons that the benefit should not be terminated.
153.7 	(b) If the chief administrative officer is unable to contact the person andnotice of 
153.8 	determination is returned as undeliverable and the person cannot be reached by any other 
153.9 	reasonable means of communication and the executive director determines that a failure to 
153.10 	terminate the benefit will result in unauthorized payment by a covered pension plan, the 
153.11 	chief administrative officerexecutive director may terminate the benefit immediately upon 
153.12 	mailing a written notice containing the information required by subdivision 3 to the address 
153.13 	to which the most recent benefit payment was sent and, if that address is that of a financial 
153.14 	institution, to the last known address of the person.

153.15 	EFFECTIVE DATE. This section is effective the day following final enactment.

153.16 	Sec. 12. Minnesota Statutes 2016, section 356.96, subdivision 5, is amended to read:
153.17 		Subd. 5.Petition for review. (a) Upon receipt of the notice of determination required 
153.18 	in subdivision 3, a person who claims a right under subdivision 2 may petition the governing 
153.19 	board of the covered pension plan for a review of that decision by the governing board of 
153.20 	the covered pension plan the executive director's determination.
153.21 	(b) A petition under this section must be sent to the chief administrative officer by mail 
153.22 	and must be postmarkedThe petitioner must file the petition for review with the 
153.23 	administrative office of the covered pension plan no later than 60 days after the person 
153.24 	receiveddate of the notice of determination required by subdivision 3. Filing of the petition 
153.25 	is effective upon mailing or personal delivery. The petition must include the person's
153.26 	petitioner's statement of the reason or reasons that the person believes the decision of the 
153.27 	chief administrative officerdetermination of the executive director should be reversed or 
153.28 	modified. The petition may include all documentation and written materials that the petitioner 
153.29 	deems to be relevant. In developing a record for review by the board when a decision is 
153.30 	appealed, the chief administrative officer may direct that the applicant participate in a 
153.31 	fact-finding session conducted by an administrative law judge assigned by the Office of 
153.32 	Administrative Hearings and, as applicable, participate in a vocational assessment conducted 
153.33 	by a qualified rehabilitation counselor on contract with the applicable retirement system.

153.34 	EFFECTIVE DATE. This section is effective the day following final enactment.

154.1 	Sec. 13. Minnesota Statutes 2016, section 356.96, subdivision 6, is amended to read:
154.2 		Subd. 6.Failure to petition. If a timely petition for review under subdivision 5 is not 
154.3 	filed with the chief administrative officer,office of the covered pension plan'splan, the 
154.4 	executive director's determination is final and is not subject to further administrative or 
154.5 	judicial review.

154.6 	EFFECTIVE DATE. This section is effective the day following final enactment.

154.7 	Sec. 14. Minnesota Statutes 2016, section 356.96, subdivision 7, is amended to read:
154.8 		Subd. 7.Notice of hearing; fact-finding; filing and timing requirements. (a) After 
154.9 	receiving a petition, the chief administrative officerexecutive director must schedule a 
154.10 	timelyhearing to review of the petition before the governing board of the covered pension 
154.11 	plan or the executive director may defer the scheduling of a hearing until after a fact-finding 
154.12 	conference under paragraph (b). The review must be scheduled to take into consideration 
154.13 	any necessary accommodations to allow the petitioner to participate in the governing board's 
154.14 	review.
154.15 	(b) The executive director may direct the petitioner to participate in a fact-finding 
154.16 	conference conducted by an administrative law judge assigned by the Office of 
154.17 	Administrative Hearings. The fact-finding conference is an informal proceeding not subject 
154.18 	to Minnesota Rules, chapter 1400, except that Minnesota Rules, part 1400.7300, shall govern 
154.19 	the admissibility of evidence and Minnesota Rules, part 1400.8603, shall govern how the 
154.20 	fact-finding conference is conducted. The administrative law judge must issue a report and 
154.21 	a recommendation to the governing board.
154.22 	(c) If the petitioner's claim relates to disability benefits, the executive director may direct 
154.23 	the petitioner to participate in a vocational assessment conducted by a qualified rehabilitation 
154.24 	counselor under contract with the covered pension plan. The counselor must issue a report 
154.25 	regarding the assessment to the governing board.
154.26 	(b)(d) Not less than 30 calendar days before the date scheduled for the hearing date
154.27 	before the governing board, the chief administrative officerexecutive director must provide 
154.28 	by mail tonotify the petitioner an acknowledgment of the receipt of the person's petition 
154.29 	and a follow-up notice of the time and place of the meeting at which the governing board 
154.30 	is scheduled to consider the petition andconduct the hearing. If there has been no fact-finding 
154.31 	conference under paragraph (b), not less than 15 days before the date scheduled for the 
154.32 	hearing, the petitioner and the executive director must provide a copyto the governing board 
154.33 	and the other party copies of all relevant documents,documentary evidence, summaries, 
155.1 	and recommendations assembled by or on behalf of the plan administration to be considered 
155.2 	by the governing board that will be presented and a list of witnesses who will testify, along 
155.3 	with a summary of their testimony.
155.4 	(c) All documents and materials that the petitioner wishes to be part of the record for 
155.5 	review must be filed with the chief administrative officer and must be received in the offices 
155.6 	of the covered pension plan at least 15 days before the date of the meeting at which the 
155.7 	petition is scheduled to be heard.
155.8 	(d) A(e) The petitioner may request a continuancepostponement of athe date scheduled 
155.9 	for the hearing if the request is received by the chief administrative officer withinbefore 
155.10 	the governing board within a reasonable time, but no later than ten calendar days ofbefore 
155.11 	the scheduled hearing date of the applicable board meeting. The chief administrative officer 
155.12 	must reschedule the review within a reasonable time. Only one continuance may be granted 
155.13 	to any petitioner. A petitioner shall be granted only one postponement unless the applicable 
155.14 	covered pension plan agrees to additional postponements.

155.15 	EFFECTIVE DATE. This section is effective the day following final enactment.

155.16 	Sec. 15. Minnesota Statutes 2016, section 356.96, subdivision 8, is amended to read:
155.17 		Subd. 8.Record for review. (a) All evidence, including all records, documents, and 
155.18 	affidavits in the possession of the covered pension plan of which the covered pension plan 
155.19 	desires to avail itself and be considered by the governing board, and all evidence which the 
155.20 	petitioner wishes to present to the governing board, including any evidence which would 
155.21 	otherwise be classified by law as "private," must be made part of the hearing record.
155.22 	(b) The chief administrative officerexecutive director must provide a copy of the record 
155.23 	to each member of the governing board at least sevenfive days before the scheduled hearing 
155.24 	date.
155.25 	(c) Any additional document, affidavit, or other relevant information that the petitioner 
155.26 	requests be part of the record may be admitted with the consent of the governing board. If 
155.27 	a fact-finding conference under subdivision 7, paragraph (b), is not conducted, the record 
155.28 	is limited to those materials provided to the petitioner in accordance with subdivision 7, 
155.29 	paragraph (d), those filed by the petitioner with the covered pension plan in a timely manner 
155.30 	in accordance with subdivision 7, paragraph (e), any vocational assessment report under 
155.31 	subdivision 7, paragraph (c), and any testimony at the hearing before the governing board. 
155.32 	Any additional evidence may be placed in the record pursuant to subdivision 10, paragraph 
155.33 	(b).
156.1 	(d) If a fact-finding conference under subdivision 7, paragraph (b), or a contested case 
156.2 	hearing under subdivision 12, paragraph (b), is conducted, the record before the governing 
156.3 	board must be limited to the following:
156.4 	(1) the record from the Office of Administrative Hearings;
156.5 	(2) seven-page submissions by the petitioner and a representative of the covered pension 
156.6 	plan commenting on the administrative law judge's recommendation; and
156.7 	(3) any vocational assessment report under subdivision 7, paragraph (c).

156.8 	EFFECTIVE DATE. This section is effective the day following final enactment.

156.9 	Sec. 16. Minnesota Statutes 2016, section 356.96, subdivision 9, is amended to read:
156.10 		Subd. 9.Amended determination. At any time before the hearing before the governing 
156.11 	board, for good cause shown and made part of the records of the plan, the chief administrative 
156.12 	officerexecutive director may reverse, alter, amend, or modify the prior decision which is 
156.13 	subject to review under this section by issuing an amended decision determination to the 
156.14 	petitioner. Upon doing so, the chief administrative officerexecutive director may cancel 
156.15 	the governing board's scheduled review of the person's petition and shall so notify the 
156.16 	petitioner.

156.17 	EFFECTIVE DATE. This section is effective the day following final enactment.

156.18 	Sec. 17. Minnesota Statutes 2016, section 356.96, subdivision 10, is amended to read:
156.19 		Subd. 10.Board hearing. (a) The governing board shall hold a timely hearing on a 
156.20 	petition for review as part of a regularly scheduled board meeting, or as part of a special 
156.21 	meeting if so scheduled. All governing board members who participate in the 
156.22 	decision-making process must be familiar with the record. The governing board shall make 
156.23 	its decision on a petition solely on the record as submitted and on the proceedings of the 
156.24 	hearing.
156.25 	(b) At the hearing, the petitioner, the petitioner's attorney, and the chief administrative 
156.26 	officerrepresentative, if any, the executive director, and a representative of the covered 
156.27 	pension plan who does not also serve as the governing board's legal advisor during the 
156.28 	board's decision-making process may state and discuss with the governing board their 
156.29 	positions with respect to the petition. If no fact-finding conference under subdivision 7, 
156.30 	paragraph (b), or contested case hearing under subdivision 12, paragraph (b), was conducted, 
156.31 	additional evidence may be received in the form of testimony from previously disclosed 
156.32 	witnesses. The governing board may allow further documentation to be placed in the record 
157.1 	at the board meeting only with the agreement of both the chief administrative officer
157.2 	executive director and the petitioner. The chief administrative officerexecutive director 
157.3 	may not otherwise participate in the board's decision-making process.
157.4 	(b) When a petition presents a contested issue of law, an assistant attorney general may 
157.5 	participate and may argue on behalf of the legal position taken by the chief administrative 
157.6 	officer if that assistant attorney general does not also serve as the governing board's legal 
157.7 	advisor during the board's decision-making process.
157.8 	(c) A motion by a board member, supported by a summary of the relevant facts, 
157.9 	conclusions and reasons, as properly amended and approved by a majority of the governing 
157.10 	board, constitutes the board's final decision. A verbatim statement of the board's final 
157.11 	decision must be served upon the petitioner. If the decision is contrary to the petitioner's 
157.12 	desired outcome, the notice shall inform the petitioner of the appeal rights set forth in 
157.13 	subdivision 13.
157.14 	(d)(c) If a petitioner who received timely notice of a scheduled hearing fails to appear, 
157.15 	the governing board may nevertheless hear the petition and issue a decision.
157.16 	(d) The governing board's decision shall be made upon a motion by a board member 
157.17 	and approval by a majority of the governing board. The governing board must issue its 
157.18 	decision as a written order containing findings of fact, conclusions of law, and the board's 
157.19 	decision no later than 30 days after the hearing. If the decision is contrary to the petitioner's 
157.20 	desired outcome, the notice must inform the petitioner of the appeal rights set forth in 
157.21 	subdivision 13.

157.22 	EFFECTIVE DATE. This section is effective the day following final enactment.

157.23 	Sec. 18. Minnesota Statutes 2016, section 356.96, subdivision 11, is amended to read:
157.24 		Subd. 11.Disability medical issues. (a) If a person petitions the governing boardthe 
157.25 	petitioner seeks to reverse or modify a determination which foundby the executive director 
157.26 	that there exists nowas insufficient medical data supportingto support an application for 
157.27 	disability benefits, the governing board may reverse that determination only if there is in 
157.28 	fact medical evidence supporting the application. The governing board has the discretion 
157.29 	to resubmit a disability benefit application at any time to a medical advisor for 
157.30 	reconsideration, and the resubmission may include an instruction that further medical 
157.31 	examinations be obtained.
157.32 	(b) The governing board may make a determination contrary to the recommendation of 
157.33 	the medical advisor only if there is expert medical evidence in the record to support its 
158.1 	contrary decision. If there is no medical evidence contrary to the opinion of the medical 
158.2 	advisor in the record and the medical advisor attests that the decision was made in accordance 
158.3 	with the applicable disability standard, the board must follow the decision of the medical 
158.4 	advisor regarding the cause of the disability.
158.5 	(c) The obligation of the governing board to follow the decision of the medical advisor 
158.6 	under paragraph (b) does not apply to instances when the governing board makes a 
158.7 	determination different from the recommendation of the medical advisor on issues that do 
158.8 	not involve medical issues.

158.9 	EFFECTIVE DATE. This section is effective the day following final enactment.

158.10 	Sec. 19. Minnesota Statutes 2016, section 356.96, subdivision 12, is amended to read:
158.11 		Subd. 12.Referral for administrative hearing. (a) Notwithstanding any provision of 
158.12 	sections 14.03, 14.06, and 14.57 to 14.69 to the contrary, a challenge to a determination of 
158.13 	the chief administrative officer of a covered pension planA fact-finding conference under 
158.14 	subdivision 7, paragraph (b), must be conducted exclusively under the procedures set forth 
158.15 	in this section and is not as a contested case under chapter 14.
158.16 	(b) Notwithstanding the provisions of paragraph (a), A governing board, in its sole 
158.17 	discretion, may refer a petition brought under this section to the Office of Administrative 
158.18 	Hearings for a contested case hearing under sections 14.57 to 14.69.

158.19 	EFFECTIVE DATE. This section is effective the day following final enactment.

158.20 	Sec. 20. Minnesota Statutes 2016, section 356.96, subdivision 13, is amended to read:
158.21 		Subd. 13.Appeal of the governing board's decision; judicial review. WithinNo later 
158.22 	than 60 days ofafter the date of the mailing of the notice of the governing board's decision, 
158.23 	the petitioner may appeal the decision by filing a writ of certiorari with the Court of Appeals 
158.24 	under section 606.01 and Rule 115 of the Minnesota Rules of Civil Appellate Procedure. 
158.25 	Failure by a person to appeal to the Court of Appeals within the 60-day period precludes 
158.26 	the person from later raising, in any subsequent administrative hearing or court proceeding, 
158.27 	those substantive and procedural issues that reasonably should have been raised upon a 
158.28 	timely appeal.

158.29 	EFFECTIVE DATE. This section is effective the day following final enactment.

158.30 	Sec. 21.  REPEALER.
 158.31 	(a) Minnesota Statutes 2016, section 356.611, subdivisions 3, 3a, 4, and 5, are repealed.
159.1 	(b) Minnesota Statutes 2016, section 356.96, subdivisions 14 and 15, are repealed.

159.2 	EFFECTIVE DATE. Paragraph (a) is effective July 1, 2018. Paragraph (b) is effective 
159.3 	the day following final enactment.

159.4 	ARTICLE 14
159.5 	ACTUARIAL ASSUMPTION CHANGES

159.6 	Section 1. Minnesota Statutes 2017 Supplement, section 356.215, subdivision 8, is amended 
159.7 	to read:
159.8 		Subd. 8.Interest and salary assumptions. (a) The actuarial valuation must use the 
159.9 	applicable following interest assumption:
159.10 	(1) select and ultimate interest rate assumption

159.12159.11
	plan
	ultimate interest rate 
assumption
		
159.13	teachers retirement plan
	8.5%
		
159.14 	The select preretirement interest rate assumption for the period through June 30, 2017, 
159.15 	is eight percent.
159.16 	(2) single rate interest rate assumption

159.18159.17
	plan
	interest rate 
assumption
		
159.19	general state employees retirement plan
	8%
		
159.20	correctional state employees retirement plan
	8
		
159.21	State Patrol retirement plan
	8
		
159.22
159.23
159.24	legislators retirement plan, and for the 
constitutional officers calculation of total plan 
liabilities
	0
		
159.25	judges retirement plan
	8
		
159.26	general public employees retirement plan
	8
		
159.27	public employees police and fire retirement plan
	8
		
159.28
159.29	local government correctional service retirement 
plan
	8
		
159.30	St. Paul teachers retirement plan
	8
		
159.31	Bloomington Fire Department Relief Association
	6
		
159.32
159.33	local monthly benefit volunteer firefighter relief 
associations
	5
		
159.34
159.35	monthly benefit retirement plans in the statewide 
volunteer firefighter retirement plan
	6
		
160.1 	(b)(1) If funding stability has been attained, the valuation must use a postretirement 
160.2 	adjustment rate actuarial assumption equal to the postretirement adjustment rate specified 
160.3 	in section 354A.29, subdivision 9, or 356.415, subdivision 1, whichever applies.
160.4 	(2) If funding stability has not been attained, the valuation must use a select postretirement 
160.5 	adjustment rate actuarial assumption equal to the postretirement adjustment rate specified 
160.6 	in section 354A.29, subdivision 8, or 356.415, subdivision 1a, 1b, 1c, 1d, 1e, or 1f, whichever 
160.7 	applies, for a period ending when the approved actuary estimates that the plan will attain 
160.8 	the defined funding stability measure, and thereafter an ultimate postretirement adjustment 
160.9 	rate actuarial assumption equal to the postretirement adjustment rate under section 354A.29, 
160.10 	subdivision 9, or 356.415, subdivision 1, for the applicable period or periods beginning 
160.11 	when funding stability is projected to be attained.
160.12 	(c) The actuarial valuation must use the applicable following single rate future salary 
160.13 	increase assumption, the applicable following modified single rate future salary increase 
160.14 	assumption, or the applicable following graded rate future salary increase assumption:
160.15 	(1) single rate future salary increase assumption

160.16	plan
	future salary increase assumption
	
160.17	legislators retirement plan
		5%
	
160.18	judges retirement plan
		2.75
	
160.19	Bloomington Fire Department Relief Association
		4
	
160.20 	(2) age-related future salary increase age-related select and ultimate future salary increase 
160.21 	assumption or graded rate future salary increase assumption

160.22	plan
	future salary increase assumption
	
160.23	local government correctional service retirement plan
	assumption B
	
160.24	St. Paul teachers retirement plan
	assumption A
	
160.25 	For plans other than the St. Paul teachers 
160.26 	retirement plan and the local government 
160.27 	correctional service retirement plan, the select 
160.28 	calculation is: Fund Association, during the a
160.29 	designated select period of 15 years, in 
160.30 	addition to the age-based rates shown below, 
160.31 	a designated percentage rate of 0.2 percent is 
160.32 	multiplied by the result of the designated 
160.33 	integer15 minus T, where T is the number of 
160.34 	completed years of service, and is added to 
161.1 	the applicable future salary increase 
161.2 	assumption. The designated select period is 
161.3 	ten years and the designated integer is ten for 
161.4 	the local government correctional service 
161.5 	retirement plan and 15 for the St. Paul 
161.6 	Teachers Retirement Fund Association. The 
161.7 	designated percentage rate is 0.2 percent for 
161.8 	the St. Paul Teachers Retirement Fund 
161.9 	Association.
161.10 	The ultimate future salary increase assumption is:

161.11	age
	A
	B
		
161.12	16
	5.9%
	8.75%
		
161.13	17
	5.9
	8.75
		
161.14	18
	5.9
	8.75
		
161.15	19
	5.9
	8.75
		
161.16	20
	5.9
	8.75
		
161.17	21
	5.9
	8.5
		
161.18	22
	5.9
	8.25
		
161.19	23
	5.85
	8
		
161.20	24
	5.8
	7.75
		
161.21	25
	5.75
	7.5
		
161.22	26
	5.7
	7.25
		
161.23	27
	5.65
	7
		
161.24	28
	5.6
	6.75
		
161.25	29
	5.55
	6.5
		
161.26	30
	5.5
	6.5
		
161.27	31
	5.45
	6.25
		
161.28	32
	5.4
	6.25
		
161.29	33
	5.35
	6.25
		
161.30	34
	5.3
	6
		
161.31	35
	5.25
	6
		
161.32	36
	5.2
	5.75
		
161.33	37
	5.15
	5.75
		
161.34	38
	5.1
	5.75
		
161.35	39
	5.05
	5.5
		
161.36	40
	5
	5.5
		
161.37	41
	4.95
	5.5
		
162.1	42
	4.9
	5.25
		
162.2	43
	4.85
	5
		
162.3	44
	4.8
	5
		
162.4	45
	4.75
	4.75
		
162.5	46
	4.7
	4.75
		
162.6	47
	4.65
	4.75
		
162.7	48
	4.6
	4.75
		
162.8	49
	4.55
	4.75
		
162.9	50
	4.5
	4.75
		
162.10	51
	4.45
	4.75
		
162.11	52
	4.4
	4.75
		
162.12	53
	4.35
	4.75
		
162.13	54
	4.3
	4.75
		
162.14	55
	4.25
	4.5
		
162.15	56
	4.2
	4.5
		
162.16	57
	4.15
	4.25
		
162.17	58
	4.1
	4
		
162.18	59
	4.05
	4
		
162.19	60
	4
	4
		
162.20	61
	4
	4
		
162.21	62
	4
	4
		
162.22	63
	4
	4
		
162.23	64
	4
	4
		
162.24	65
	4
	3.75
		
162.25	66
	4
	3.75
		
162.26	67
	4
	3.75
		
162.27	68
	4
	3.75
		
162.28	69
	4
	3.75
		
162.29	70
	4
	3.75
		
162.30 	(3) service-related ultimate future salary increase assumption

162.31
162.32	general state employees retirement plan of the Minnesota 
State Retirement System
	assumption A
	
162.33
162.34	general employees retirement plan of the Public 
Employees Retirement Association
	assumption B
	
162.35	Teachers Retirement Association
	assumption C
	
162.36	public employees police and fire retirement plan
	assumption D
	
162.37	State Patrol retirement plan
	assumption E
	
163.1
163.2	correctional state employees retirement plan of the 
Minnesota State Retirement System
	assumption F

163.3
163.4	service 
length
	A
	B
	C
	D
	E
	F
	
163.5163.6	1
	10.25 14%
	11.78
11.5%
	12 9.5%
	12.75%
	7.75%
	5.75%
	
163.7	2
	7.85 11.5
	8.65 8.5
	9 9.5
	10.75
	7.25
	5.6
	
163.8	3
	6.65 6.25
	7.21 7
	8 7.75
	8.75
	6.75
	5.45
	
163.9	4
	5.95 5.5
	6.33 6
	7.5 7.25
	7.75
	6.5
	5.3
	
163.10	5
	5.45 5.25
	5.72 5.5
	7.25 7
	6.25
	6.25
	5.15
	
163.11	6
	5.05 5.15
	5.27 5.2
	7
	5.85
	6
	5
	
163.12	7
	4.75 5
	4.91 4.9
	6.85
	5.55
	5.75
	4.85
	
163.13	8
	4.45 4.75
	4.62 4.8
	6.7
	5.35
	5.6
	4.7
	
163.14	9
	4.25 4.5
	4.38 4.7
	6.55
	5.15
	5.45
	4.55
	
163.15	10
	4.15 4.25
	4.17 4.5
	6.4
	5.05
	5.3
	4.4
	
163.16	11
	3.95 4.2
	3.99 4.25
	6.25
	4.95
	5.15
	4.3
	
163.17	12
	3.85 4.15
	3.83 4.1
	6
	4.85
	5
	4.2
	
163.18	13
	3.75 4.1
	3.69 4
	5.75
	4.75
	4.85
	4.1
	
163.19	14
	3.55 4.05
	3.57 3.9
	5.5
	4.65
	4.7
	4
	
163.20	15
	3.45 4
	3.45 3.9
	5.25
	4.55
	4.55
	3.9
	
163.21	16
	3.35 3.95
	3.35 3.85
	5
	4.55
	4.4
	3.8
	
163.22	17
	3.25 3.9
	3.26 3.8
	4.75
	4.55
	4.25
	3.7
	
163.23	18
	3.25 3.85
	3.25 3.75
	4.5
	4.55
	4.1
	3.6
	
163.24	19
	3.25 3.8
	3.25 3.75
	4.25 4.3
	4.55
	3.95
	3.5
	
163.25	20
	3.25 3.75
	3.25 3.75
	4 4.2
	4.55
	3.8
	3.5
	
163.26	21
	3.25 3.7
	3.25 3.75
	3.9 4.1
	4.45
	3.75
	3.5
	
163.27	22
	3.25 3.65
	3.25 3.7
	3.8 4
	4.35
	3.75
	3.5
	
163.28	23
	3.25 3.6
	3.25 3.6
	3.7 3.9
	4.25
	3.75
	3.5
	
163.29	24
	3.25 3.55
	3.25 3.6
	3.6 3.8
	4.25
	3.75
	3.5
	
163.30	25
	3.25 3.5
	3.25 3.6
	3.5 3.7
	4.25
	3.75
	3.5
	
163.31	26
	3.25 3.5
	3.25 3.5
	3.5 3.6
	4.25
	3.75
	3.5
	
163.32	27
	3.25 3.5
	3.25 3.5
	3.5
	4.25
	3.75
	3.5
	
163.33	28
	3.25 3.5
	3.25 3.5
	3.5
	4.25
	3.75
	3.5
	
163.34	29
	3.25 3.5
	3.25 3.5
	3.5
	4.25
	3.75
	3.5
	
163.35	30 or more
	3.25 3.5
	3.25 3.5
	3.5
	4.25
	3.75
	3.5
	
163.36 	(d) The actuarial valuation must use the applicable following payroll growth assumption 
163.37 	for calculating the amortization requirement for the unfunded actuarial accrued liability 
163.38 	where the amortization retirement is calculated as a level percentage of an increasing payroll:

164.1	plan
	payroll growth assumption
	
164.2
164.3	general state employees retirement plan of the Minnesota 
State Retirement System
	3.5%
	
164.4	correctional state employees retirement plan
	3.5
	
164.5	State Patrol retirement plan
	3.5
	
164.6	judges retirement plan
	2.75
	
164.7
164.8	general employees retirement plan of the Public 
Employees Retirement Association
	3.5
	
164.9	public employees police and fire retirement plan
	3.5
	
164.10	local government correctional service retirement plan
	3.5
	
164.11	teachers retirement plan
	3.75 3.5
	
164.12	St. Paul teachers retirement plan
	4
	
164.13 	(e) The assumptions set forth in paragraphs (c) and (d) continue to apply, unless a 
164.14 	different salary assumption or a different payroll increase assumption:
164.15 	(1) has been proposed by the governing board of the applicable retirement plan;
164.16 	(2) is accompanied by the concurring recommendation of the actuary retained under 
164.17 	section 356.214, subdivision 1, if applicable, or by the approved actuary preparing the most 
164.18 	recent actuarial valuation report if section 356.214 does not apply; and
164.19 	(3) has been approved or deemed approved under subdivision 18.

164.20 	EFFECTIVE DATE. This section is effective July 1, 2018, and applies to actuarial 
164.21 	valuations prepared on or after that date.

164.22 	ARTICLE 15
164.23 	VOLUNTEER FIREFIGHTER RELIEF ASSOCIATIONS MODIFICATIONS

164.24 	Section 1. Minnesota Statutes 2016, section 356A.06, subdivision 7, is amended to read:
164.25 		Subd. 7.Expanded list of authorized investment securities. (a) Authority. A covered 
164.26 	pension plan not described by subdivision 6, paragraph (a), is an expanded list plan and 
164.27 	shall invest its assets as specified in this subdivision. The governing board of an expanded 
164.28 	list plan may select and appoint investment agencies to act for or on its behalf.
164.29 	(b) Securities generally; investment forms. An expanded list plan is authorized to 
164.30 	purchase, sell, lend, and exchange the investment securities authorized under this subdivision, 
164.31 	including puts and call options and future contracts traded on a contract market regulated 
164.32 	by a governmental agency or by a financial institution regulated by a governmental agency. 
164.33 	These securities may be owned directly or through shares in exchange-traded or mutual 
164.34 	funds, or as units in commingled trusts, subject to any limitations specified in this subdivision.
165.1 	(c) Government obligations. An expanded list plan is authorized to invest funds in 
165.2 	governmental bonds, notes, bills, mortgages, and other evidences of indebtedness if the 
165.3 	issue is backed by the full faith and credit of the issuer or the issue is rated among the top 
165.4 	four quality rating categories by a nationally recognized rating agency. The obligations in 
165.5 	which funds may be invested under this paragraph are guaranteed or insured issues of:
165.6 	(1) the United States, one of its agencies, one of its instrumentalities, or an organization 
165.7 	created and regulated by an act of Congress;
165.8 	(2) the Dominion of Canada or one of its provinces if the principal and interest are 
165.9 	payable in United States dollars;
165.10 	(3) a state or one of its municipalities, political subdivisions, agencies, or 
165.11 	instrumentalities; and
165.12 	(4) a United States government-sponsored organization of which the United States is a 
165.13 	member if the principal and interest are payable in United States dollars.
165.14 	(d) Investment-grade corporate obligations. An expanded list plan is authorized to 
165.15 	invest funds in bonds, notes, debentures, transportation equipment obligations, or any other 
165.16 	longer term evidences of indebtedness issued or guaranteed by a corporation organized 
165.17 	under the laws of the United States or any of its states, or the Dominion of Canada or any 
165.18 	of its provinces if:
165.19 	(1) the principal and interest are payable in United States dollars; and
165.20 	(2) the obligations are rated among the top four quality categories by a nationally 
165.21 	recognized rating agency.
165.22 	(e) Below-investment-grade corporate obligations. An expanded list plan is authorized 
165.23 	to invest in unrated corporate obligations or in corporate obligations that are not rated among 
165.24 	the top four quality categories by a nationally recognized rating agency if:
165.25 	(1) the aggregate value of these obligations does not exceed five percent of the covered 
165.26 	pension plan's market value;
165.27 	(2) the covered pension plan's participation is limited to 50 percent of a single offering 
165.28 	subject to this paragraph; and
165.29 	(3) the covered pension plan's participation is limited to 25 percent of an issuer's 
165.30 	obligations subject to this paragraph.
165.31 	(f) Other obligations. (1) An expanded list plan is authorized to invest funds in:
166.1 	(i) bankers acceptances and deposit notes if issued by a United States bank that is rated 
166.2 	in the highest four quality categories by a nationally recognized rating agency;
166.3 	(ii) certificates of deposit if issued by a United States bank or savings institution rated 
166.4 	in the highest four quality categories by a nationally recognized rating agency or whose 
166.5 	certificates of deposit are fully insured by federal agencies, or if issued by a credit union in 
166.6 	an amount within the limit of the insurance coverage provided by the National Credit Union 
166.7 	Administration;
166.8 	(iii) commercial paper if issued by a United States corporation or its Canadian subsidiary 
166.9 	and if rated in the highest two quality categories by a nationally recognized rating agency;
166.10 	(iv) mortgage securities and asset-backed securities if rated in the top four quality 
166.11 	categories by a nationally recognized rating agency;
166.12 	(v) repurchase agreements and reverse repurchase agreements if collateralized with 
166.13 	letters of credit or securities authorized in this section;
166.14 	(vi) guaranteed investment contracts if issued by an insurance company or a bank that 
166.15 	is rated in the top four quality categories by a nationally recognized rating agency or 
166.16 	alternative guaranteed investment contracts if the underlying assets comply with the 
166.17 	requirements of this subdivision;
166.18 	(vii) savings accounts if fully insured by a federal agency; and
166.19 	(viii) guaranty fund certificates, surplus notes, or debentures if issued by a domestic 
166.20 	mutual insurance company.
166.21 	(2) Sections 16A.58, 16C.03, subdivision 4, and 16C.05 do not apply to certificates of 
166.22 	deposit and collateralization agreements executed by the covered pension plan under clause 
166.23 	(1), item (ii).
166.24 	(3) In addition to investments authorized by clause (1), item (iv), an expanded list plan 
166.25 	is authorized to purchase from the Minnesota Housing Finance Agency all or any part of a 
166.26 	pool of residential mortgages, not in default, that has previously been financed by the 
166.27 	issuance of bonds or notes of the agency. The covered pension plan may also enter into a 
166.28 	commitment with the agency, at the time of any issue of bonds or notes, to purchase at a 
166.29 	specified future date, not exceeding 12 years from the date of the issue, the amount of 
166.30 	mortgage loans then outstanding and not in default that have been made or purchased from 
166.31 	the proceeds of the bonds or notes. The covered pension plan may charge reasonable fees 
166.32 	for any such commitment and may agree to purchase the mortgage loans at a price sufficient 
166.33 	to produce a yield to the covered pension plan comparable, in its judgment, to the yield 
167.1 	available on similar mortgage loans at the date of the bonds or notes. The covered pension 
167.2 	plan may also enter into agreements with the agency for the investment of any portion of 
167.3 	the funds of the agency. The agreement must cover the period of the investment, withdrawal 
167.4 	privileges, and any guaranteed rate of return.
167.5 	(g) Corporate stocks. An expanded list plan is authorized to invest in stocks or 
167.6 	convertible issues of any corporation organized under the laws of the United States or any 
167.7 	of its states, any corporation organized under the laws of the Dominion of Canada or any 
167.8 	of its provinces, or any corporation listed on an exchange that is regulated by an agency of 
167.9 	the United States or of the Canadian national government.
167.10 	An investment in any corporation must not exceed five percent of the total outstanding 
167.11 	shares of that corporation, except that an expanded list plan may hold up to 20 percent of 
167.12 	the shares of a real estate investment trust and up to 20 percent of the shares of a closed 
167.13 	mutual fund. Purchase of shares of exchange-traded or mutual funds shall be consistent 
167.14 	with paragraph (b).
167.15 	(h) Other investments. (1) In addition to the investments authorized in paragraphs (b) 
167.16 	to (g), and subject to the provisions in clause (2), an expanded list plan is authorized to 
167.17 	invest funds in:
167.18 	(i) equity and debt investment businesses through participation in limited partnerships, 
167.19 	trusts, private placements, limited liability corporations, limited liability companies, limited 
167.20 	liability partnerships, and corporations;
167.21 	(ii) real estate ownership interests or loans secured by mortgages or deeds of trust or 
167.22 	shares of real estate investment trusts, through investment in limited partnerships, 
167.23 	bank-sponsored collective funds, trusts, mortgage participation agreements, and insurance 
167.24 	company commingled accounts, including separate accounts;
167.25 	(iii) resource investments through limited partnerships, trusts, private placements, limited 
167.26 	liability corporations, limited liability companies, limited liability partnerships, and 
167.27 	corporations; and
167.28 	(iv) international securities.
167.29 	(2) The investments authorized in clause (1) must conform to the following provisions:
167.30 	(i) the aggregate value of all investments made under clause (1), items (i), (ii), and (iii), 
167.31 	may not exceed 35 percent of the market value of the fund for which the expanded list plan 
167.32 	is investing;
168.1 	(ii) there must be at least four unrelated owners of the investment other than the expanded 
168.2 	list plan for investments made under clause (1), item (i), (ii), or (iii);
168.3 	(iii) the expanded list plan's participation in an investment vehicle is limited to 20 percent 
168.4 	thereof for investments made under clause (1), item (i), (ii), or (iii);
168.5 	(iv) the expanded list plan's participation in a limited partnership does not include a 
168.6 	general partnership interest or other interest involving general liability. The expanded list 
168.7 	plan may not engage in any activity as a limited partner which creates general liability;
168.8 	(v) the aggregate value of all unrated obligations and obligations that are not rated among 
168.9 	the top four quality categories by a nationally recognized rating agency authorized by 
168.10 	paragraph (e) and clause (1), item (iv), must not exceed five percent of the covered plan's 
168.11 	market value; and
168.12 	(vi) for volunteer firefighter relief associations, emerging market equity and international 
168.13 	debt investments authorized under clause (1), item (iv), must not exceed 15 percent of the 
168.14 	association's special fund market value.
168.15 	(i) Supplemental plan investments. The governing body of an expanded list plan may 
168.16 	certify assets to the State Board of Investment for investment under section 11A.17.
168.17 	(j) Asset mix limitations. The aggregate value of an expanded list plan's investments 
168.18 	under paragraphs (g) and (h) and equity investments under paragraph (i), regardless of the 
168.19 	form in which these investments are held, must not exceed 85 percent of the covered plan's 
168.20 	market value.

168.21 	EFFECTIVE DATE. This section is effective January 1, 2019.

168.22 	Sec. 2. Minnesota Statutes 2016, section 424A.001, subdivision 2, is amended to read:
168.23 		Subd. 2.Fire department. "Fire department" includes a municipal fire department or,
168.24 	an independent nonprofit firefighting corporation, and a fire department established as or 
168.25 	operated by a joint powers entity under section 471.59.

168.26 	EFFECTIVE DATE. This section is effective January 1, 2019.

168.27 	Sec. 3. Minnesota Statutes 2016, section 424A.001, is amended by adding a subdivision 
168.28 	to read:
168.29 		Subd. 2a.Municipal. "Municipal" means of a city or township.

168.30 	EFFECTIVE DATE. This section is effective January 1, 2019.

169.1 	Sec. 4. Minnesota Statutes 2016, section 424A.001, subdivision 3, is amended to read:
169.2 		Subd. 3.Municipality. "Municipality" means a municipality city or township which 
169.3 	has established a fire department with which the relief association is directly associated, or 
169.4 	the municipalities a city or township which have has entered into a contract with the 
169.5 	independent nonprofit firefighting corporation of which the relief association is a subsidiary
169.6 	directly associated, or a city or township that has entered into a contract with a joint powers 
169.7 	entity established under section 471.59 of which the relief association is directly associated.

169.8 	EFFECTIVE DATE. This section is effective January 1, 2019.

169.9 	Sec. 5. Minnesota Statutes 2016, section 424A.001, subdivision 10, is amended to read:
169.10 		Subd. 10.Volunteer firefighter. "Volunteer firefighter" means a person who is a member 
169.11 	of the applicable fire department or the independent nonprofit firefighting corporation and 
169.12 	is eligible for membership in the applicable relief association and:
169.13 	(i) is engaged in providing emergency response services or delivering fire education or 
169.14 	prevention services as a member of a municipal fire department, a joint powers entity fire 
169.15 	department, or an independent nonprofit firefighting corporation;
169.16 	(ii) is trained in or is qualified to provide fire suppression duties or to provide fire 
169.17 	prevention duties under subdivision 8; and
169.18 	(iii) meets any other minimum firefighter and service standards established by the fire 
169.19 	department or the independent nonprofit firefighting corporation or specified in the articles 
169.20 	of incorporation or bylaws of the relief association.

169.21 	EFFECTIVE DATE. This section is effective January 1, 2019.

169.22 	Sec. 6. Minnesota Statutes 2016, section 424A.002, subdivision 1, is amended to read:
169.23 		Subdivision 1.Authorization. A municipal fire department or an independent nonprofit 
169.24 	firefighting corporation, with approval by the applicable municipality or municipalities, 
169.25 	may establish a new volunteer firefighter relief association or may retain an existing volunteer 
169.26 	firefighter relief association. A municipal fire department or an independent nonprofit 
169.27 	firefighting corporation may be associated with only one volunteer firefighter relief 
169.28 	association at one time.

169.29 	EFFECTIVE DATE. This section is effective January 1, 2019.

170.1 	Sec. 7. [424A.003] CERTIFICATION OF SERVICE CREDIT.
170.2 	(a) When a municipal fire department, a joint powers fire department, or an independent 
170.3 	nonprofit firefighting corporation is directly associated with the volunteer firefighters relief 
170.4 	association, the fire chief shall certify annually by March 31 the service credit for the 
170.5 	previous calendar year of each volunteer firefighter rendering active service with the fire 
170.6 	department.
170.7 	(b) The certification shall be made to an officer of the relief association's board of trustees 
170.8 	and to the municipal clerk or clerk-treasurer of the largest municipality in population served 
170.9 	by the associated fire department.
170.10 	(c) The fire chief shall notify each volunteer firefighter rendering active service with 
170.11 	the fire department of the amount of service credit rendered by the firefighter for the previous 
170.12 	calendar year. The service credit notification and a description of the process and deadlines 
170.13 	for the firefighter to challenge the fire chief's determination of service credit must be provided 
170.14 	to the firefighter 60 days prior to its certification to the relief association and municipality. 
170.15 	If the service credit amount is challenged, the fire chief shall accept and consider any 
170.16 	additional pertinent information and shall make a final determination of service credit.
170.17 	(d) The service credit certification must be expressed as the number of completed months 
170.18 	of the previous year during which an active volunteer firefighter rendered at least the 
170.19 	minimum level of duties as specified and required by the fire department under the rules, 
170.20 	regulations, and policies applicable to the fire department. No more than one year of service 
170.21 	credit may be certified for a calendar year.
170.22 	(e) If a volunteer firefighter who is a member of the relief association leaves active 
170.23 	firefighting service to render active military service that is required to be governed by the 
170.24 	federal Uniformed Services Employment and Reemployment Rights Act, as amended, the 
170.25 	firefighter must be certified as providing service credit for the period of the military service, 
170.26 	up to the applicable limit of the federal Uniformed Services Employment and Reemployment 
170.27 	Rights Act. If the volunteer firefighter does not return from the military service in compliance 
170.28 	with the federal Uniformed Services Employment and Reemployment Rights Act, the service 
170.29 	credits applicable to that military service credit period are forfeited and canceled at the end 
170.30 	of the calendar year in which the time limit set by federal law occurs.

170.31 	EFFECTIVE DATE. This section is effective January 1, 2019.

171.1 	Sec. 8. Minnesota Statutes 2016, section 424A.01, subdivision 1, is amended to read:
171.2 		Subdivision 1.Minors.  No volunteer firefighters relief association associated with a 
171.3 	municipality, a joint powers entity, or an independent nonprofit firefighting corporation 
171.4 	may include as a relief association member a minor serving as a volunteer firefighter.

171.5 	EFFECTIVE DATE. This section is effective January 1, 2019.

171.6 	Sec. 9. Minnesota Statutes 2016, section 424A.01, is amended by adding a subdivision to 
171.7 	read:
171.8 		Subd. 4a.Prohibition on receipt of concurrent service credit. No firefighter may be 
171.9 	credited with service credit in a volunteer firefighters relief association for the same hours 
171.10 	of service for which coverage is already provided in a fund operated pursuant to chapter 
171.11 	353.

171.12 	EFFECTIVE DATE. This section is effective January 1, 2019, and applies to service 
171.13 	rendered on or after that date.

171.14 	Sec. 10. Minnesota Statutes 2016, section 424A.01, subdivision 5, is amended to read:
171.15 		Subd. 5.Fire prevention personnel. (a) If the fire department is a municipal department 
171.16 	and the applicable municipality approves, or if the fire department is an independent nonprofit 
171.17 	firefighting corporation and the contracting municipality or municipalities approve, the fire 
171.18 	department may employ or otherwise utilize the services of persons as volunteer firefighters 
171.19 	to perform fire prevention duties and to supervise fire prevention activities.
171.20 	(b) Personnel serving in fire prevention positions are eligible to be members of the 
171.21 	applicable volunteer firefighter relief association and to qualify for service pension or other 
171.22 	benefit coverage of the relief association on the same basis as fire department personnel 
171.23 	who perform fire suppression duties.
171.24 	(c) Personnel serving in fire prevention positions also are eligible to receive any other 
171.25 	benefits under the applicable law or practice for services on the same basis as personnel 
171.26 	who are employed to perform fire suppression duties.

171.27 	EFFECTIVE DATE. This section is effective January 1, 2019.

171.28 	Sec. 11. Minnesota Statutes 2016, section 424A.01, is amended by adding a subdivision 
171.29 	to read:
171.30 		Subd. 5a.Volunteer emergency medical personnel. Volunteer emergency medical 
171.31 	personnel are eligible to be members of the applicable volunteer firefighters relief association 
172.1 	and to qualify for service pension or other benefit coverage of the relief association on the 
172.2 	same basis as fire department personnel who perform or supervise fire suppression or fire 
172.3 	prevention duties if:
172.4 	(1) the fire department employs or otherwise uses the services of persons solely as 
172.5 	volunteer emergency medical personnel to perform emergency medical response duties or 
172.6 	supervise emergency medical response activities;
172.7 	(2) the bylaws of the relief association authorize the eligibility; and
172.8 	(3) the eligibility is approved by:
172.9 	(i) the municipality, if the fire department is a municipal department;
172.10 	(ii) the joint powers board, if the fire department is a joint powers entity; or
172.11 	(iii) the contracting municipality or municipalities, if the fire department is an independent 
172.12 	nonprofit firefighting corporation.

172.13 	EFFECTIVE DATE. This section is effective January 1, 2019, and applies to service 
172.14 	rendered on or after that date.

172.15 	Sec. 12. Minnesota Statutes 2016, section 424A.01, subdivision 6, is amended to read:
172.16 		Subd. 6.Return to active firefighting after break in service. (a) This subdivision 
172.17 	governs the service pension calculation requirements of a firefighter who returns to active 
172.18 	service after a break in service and applies to all breaks in service, except that the resumption 
172.19 	service requirements of this subdivision do not apply to leaves of absence made available 
172.20 	by federal statute, such as the Family Medical Leave Act, United States Code, title 29, 
172.21 	section 2691, and the Uniformed Services Employment and Reemployment Rights Act, 
172.22 	United States Code, title 38, section 4301, and do not apply to leaves of absence made 
172.23 	available by state statute, such as the Parental Leave Act, section 181.941; the Leave for 
172.24 	Organ Donation Act, section 181.9456; the Leave for Civil Air Patrol Service Act, section 
172.25 	181.946; the Leave for Immediate Family Members of Military Personnel Injured or Killed 
172.26 	in Active Service Act, section 181.947; or the Protection of Jurors' Employment Act, section 
172.27 	593.50.
172.28 	(b)(1) If a firefighter who has ceased to perform or supervise fire suppression and fire 
172.29 	prevention duties for at least 60 days resumes performing active firefighting with the fire 
172.30 	department associated with the relief association, if the bylaws of the relief association so 
172.31 	permit, the firefighter may again become an active member of the relief association. A 
173.1 	firefighter who returns to active service and membership is subject to the service pension 
173.2 	calculation requirements under this section.
173.3 	(2) A firefighter who has been granted an approved leave of absence not exceeding one 
173.4 	year by the fire department or by the relief association is exempt from the minimum period 
173.5 	of resumption service requirement of this section.
173.6 	(3) A person who has a break in service not exceeding one year but has not been granted 
173.7 	an approved leave of absence and who has not received a service pension or disability benefit 
173.8 	may be made exempt from the minimum period of resumption service requirement of this 
173.9 	section by the relief association bylaws.
173.10 	(4) If the bylaws so provide, a firefighter who returns to active relief association 
173.11 	membership under this paragraph may continue to collect a monthly service pension, 
173.12 	notwithstanding the service pension eligibility requirements under chapter 424A.
173.13 	(c) If a former firefighter who has received a service pension or disability benefit returns 
173.14 	to active relief association membership under paragraph (b), the firefighter may qualify for 
173.15 	the receipt of a service pension from the relief association for the resumption service period 
173.16 	if the firefighter meets the service requirements of section 424A.016, subdivision 3, or 
173.17 	424A.02, subdivision 2. No firefighter may be paid a service pension more than once for 
173.18 	the same period of service.
173.19 	(d) If a former firefighter who has not received a service pension or disability benefit 
173.20 	returns to active relief association membership under paragraph (b), the firefighter may 
173.21 	qualify for the receipt of a service pension from the relief association for the original and 
173.22 	resumption service periods if the firefighter meets the service requirements of section 
173.23 	424A.016, subdivision 3, or 424A.02, subdivision 2, based on the original and resumption 
173.24 	years of service credit.
173.25 	(e) A firefighter who returns to active lump-sum relief association membership under 
173.26 	paragraph (b) and who qualifies for a service pension under paragraph (c) must have, upon 
173.27 	a subsequent cessation of duties, any service pension for the resumption service period 
173.28 	calculated as a separate benefit. If a lump-sum service pension had been paid to the firefighter 
173.29 	upon the firefighter's previous cessation of duties, a second lump-sum service pension for 
173.30 	the resumption service period must be calculated by applying the service pension amount 
173.31 	in effect on the date of the firefighter's termination of the resumption service for all years 
173.32 	of the resumption service.
173.33 	(f) A firefighter who had not been paid a lump-sum service pension returns to active 
173.34 	relief association membership under paragraph (b), who did not meet the minimum period 
174.1 	of resumption service requirement specified in the relief association's bylaws, but who does 
174.2 	meet the minimum service requirement of section 424A.02, subdivision 2, based on the 
174.3 	firefighter's original and resumption years of active service, must have, upon a subsequent 
174.4 	cessation of duties, a service pension for the original and resumption service periods 
174.5 	calculated by applying the service pension amount in effect on the date of the firefighter's 
174.6 	termination of the resumption service, or, if the bylaws so provide, based on the service 
174.7 	pension amount in effect on the date of the firefighter's previous cessation of duties. The 
174.8 	service pension for a firefighter who returns to active lump-sum relief association membership 
174.9 	under this paragraph, but who had met the minimum period of resumption service requirement 
174.10 	specified in the relief association's bylaws, must be calculated by applying the service 
174.11 	pension amount in effect on the date of the firefighter's termination of the resumption service.
174.12 	(g) If a firefighter receiving a monthly benefit service pension returns to active monthly 
174.13 	benefit relief association membership under paragraph (b), and if the relief association 
174.14 	bylaws do not allow for the firefighter to continue collecting a monthly service pension, 
174.15 	any monthly benefit service pension payable to the firefighter is suspended as of the first 
174.16 	day of the month next following the date on which the firefighter returns to active 
174.17 	membership. If the firefighter was receiving a monthly benefit service pension, and qualifies 
174.18 	for a service pension under paragraph (c), the firefighter is entitled to an additional monthly 
174.19 	benefit service pension upon a subsequent cessation of duties calculated based on the 
174.20 	resumption service credit and the service pension accrual amount in effect on the date of 
174.21 	the termination of the resumption service. A suspended initial service pension resumes as 
174.22 	of the first of the month next following the termination of the resumption service. If the 
174.23 	firefighter was not receiving a monthly benefit service pension and meets the minimum 
174.24 	service requirement of section 424A.02, subdivision 2, a service pension must be calculated 
174.25 	by applying the service pension amount in effect on the date of the firefighter's termination 
174.26 	of the resumption service for all years of service credit.
174.27 	(h) A firefighter who was not receiving a monthly benefit service pension returns to 
174.28 	active relief association membership under paragraph (b), who did not meet the minimum 
174.29 	period of resumption service requirement specified in the relief association's bylaws, but 
174.30 	who does meet the minimum service requirement of section 424A.02, subdivision 2, based 
174.31 	on the firefighter's original and resumption years of active service, must have, upon a 
174.32 	subsequent cessation of duties, a service pension for the original and resumption service 
174.33 	periods calculated by applying the service pension amount in effect on the date of the 
174.34 	firefighter's termination of the resumption service, or, if the bylaws so provide, based on 
174.35 	the service pension amount in effect on the date of the firefighter's previous cessation of 
175.1 	duties. The service pension for a firefighter who returns to active relief association 
175.2 	membership under this paragraph, but who had met the minimum period of resumption 
175.3 	service requirement specified in the relief association's bylaws, must be calculated by 
175.4 	applying the service pension amount in effect on the date of the firefighter's termination of 
175.5 	the resumption service.
175.6 	(i) For defined contribution plans, a firefighter who returns to active relief association 
175.7 	membership under paragraph (b) and who qualifies for a service pension under paragraph 
175.8 	(c) or (d) must have, upon a subsequent cessation of duties, any service pension for the 
175.9 	resumption service period calculated as a separate benefit. If a service pension had been 
175.10 	paid to the firefighter upon the firefighter's previous cessation of duties, and if the firefighter 
175.11 	meets the minimum service requirement of section 424A.016, subdivision 3, based on the 
175.12 	resumption years of service, a second service pension for the resumption service period 
175.13 	must be calculated to include allocations credited to the firefighter's individual account 
175.14 	during the resumption period of service and deductions for administrative expenses, if 
175.15 	applicable.
175.16 	(j) For defined contribution plans, if a firefighter who had not been paid a service pension 
175.17 	returns to active relief association membership under paragraph (b), and who meets the 
175.18 	minimum service requirement of section 424A.016, subdivision 3, based on the firefighter's 
175.19 	original and resumption years of service, must have, upon a subsequent cessation of duties, 
175.20 	a service pension for the original and resumption service periods calculated to include 
175.21 	allocations credited to the firefighter's individual account during the original and resumption 
175.22 	periods of service and deductions for administrative expenses, if applicable, less any amounts 
175.23 	previously forfeited under section 424A.016, subdivision 4.

175.24 	EFFECTIVE DATE. This section is effective the day following final enactment.

175.25 	Sec. 13. Minnesota Statutes 2016, section 424A.015, subdivision 1, is amended to read:
175.26 		Subdivision 1.Separation from active service; exception. (a) No service pension is 
175.27 	payable to a person while the person remains an active member of the respective fire 
175.28 	department, and a person who is receiving a service pension is not entitled to receive any 
175.29 	other benefits from the special fund of the relief association.
175.30 	(b) No relief association as defined in section 424A.001, subdivision 4, may pay a service 
175.31 	pension or disability benefit to a former member of the relief association if that person has 
175.32 	not separated from active service with the fire department to which the relief association is 
175.33 	directly associated, unless:
176.1 	(1) the person discontinues volunteer firefighter duties with the municipality or the 
176.2 	independent nonprofit firefighting corporation, whichever applies, fire department and 
176.3 	performs duties within the municipal fire department or corporation on a full-time basis;
176.4 	(2) the governing body of the municipality or, of the independent nonprofit firefighting 
176.5 	corporation, or of the joint powers entity has filed its determination with the board of trustees 
176.6 	of the relief association that the person's experience with and service to the fire department 
176.7 	in that person's full-time capacity would be difficult to replace; and
176.8 	(3) the bylaws of the relief association were amended to provide for the payment of a 
176.9 	service pension or disability benefit for such full-time employees.

176.10 	EFFECTIVE DATE. This section is effective January 1, 2019.

176.11 	Sec. 14. Minnesota Statutes 2016, section 424A.015, is amended by adding a subdivision 
176.12 	to read:
176.13 		Subd. 7.Combined service pensions. (a) A volunteer firefighter with credit for service 
176.14 	as an active firefighter in more than one volunteer firefighters relief association is entitled 
176.15 	to a prorated service pension from each relief association if:
176.16 	(1) the articles of incorporation or bylaws of the relief associations provide;
176.17 	(2) the applicable requirements of paragraphs (b) and (c) are met; and
176.18 	(3) the volunteer firefighter otherwise qualifies.
176.19 	(b) A volunteer firefighter receiving a prorated service pension under this subdivision 
176.20 	must have a total combined amount of service credit from the two or more relief associations 
176.21 	of ten years or more, unless the bylaws of every affected relief association specify less than 
176.22 	a ten-year service vesting requirement, in which case, the total amount of required service 
176.23 	credit is the longest service vesting requirement of the relief associations. The member must 
176.24 	have one year or more of service credit in each relief association. The prorated service 
176.25 	pension must be based on:
176.26 	(1) for defined benefit relief associations, the service pension amount in effect for the 
176.27 	relief association on the date on which active volunteer firefighting services covered by that 
176.28 	relief association terminate; and
176.29 	(2) for defined contribution relief associations, the member's individual account balance 
176.30 	on the date on which active volunteer firefighting services covered by that relief association 
176.31 	terminate.
177.1 	(c) To receive a prorated service pension under this subdivision, the firefighter must 
177.2 	become a member of the second or succeeding association and must give notice of 
177.3 	membership to the prior association within two years of the date of termination of active 
177.4 	service with the prior association. The second or subsequent relief association secretary 
177.5 	must certify the notice.

177.6 	EFFECTIVE DATE. This section is effective January 1, 2019.

177.7 	Sec. 15. Minnesota Statutes 2016, section 424A.016, subdivision 2, is amended to read:
177.8 		Subd. 2.Defined contribution service pension eligibility. (a) A relief association, 
177.9 	when its articles of incorporation or bylaws so provide, may pay out of the assets of its 
177.10 	special fund a defined contribution service pension to each of its members who:
177.11 	(1) separates from active service with the fire department;
177.12 	(2) reaches age 50;
177.13 	(3) completes at least five years of active service as an active member of the municipal
177.14 	fire department to which the relief association is associated;
177.15 	(4) completes at least five years of active membership with the relief association before 
177.16 	separation from active service; and
177.17 	(5) complies with any additional conditions as to age, service, and membership that are 
177.18 	prescribed by the bylaws of the relief association.
177.19 	(b) In the case of a member who has completed at least five years of active service as 
177.20 	an active member of the fire department to which the relief association is associated on the 
177.21 	date that the relief association is established and incorporated, the requirement that the 
177.22 	member complete at least five years of active membership with the relief association before 
177.23 	separation from active service may be waived by the board of trustees of the relief association 
177.24 	if the member completes at least five years of inactive membership with the relief association 
177.25 	before the date of the payment of the service pension. During the period of inactive 
177.26 	membership, the member is not entitled to receive any disability benefit coverage, is not 
177.27 	entitled to receive additional individual account allocation of fire state aid or municipal 
177.28 	contribution towards a service pension, and is considered to have the status of a person 
177.29 	entitled to a deferred service pension.
177.30 	(c) The service pension earned by a volunteer under this chapter and the articles of 
177.31 	incorporation and bylaws of the relief association may be paid whether or not the municipality 
178.1 	or independent nonprofit firefighting corporation to which the relief association is associated 
178.2 	qualifies for the receipt of fire state aid under chapter 69.

178.3 	EFFECTIVE DATE. This section is effective January 1, 2019.

178.4 	Sec. 16. Minnesota Statutes 2016, section 424A.02, subdivision 1, is amended to read:
178.5 		Subdivision 1.Authorization. (a) A defined benefit relief association, when its articles 
178.6 	of incorporation or bylaws so provide, may pay out of the assets of its special fund a defined 
178.7 	benefit service pension to each of its members who: (1) separates from active service with 
178.8 	the fire department; (2) reaches age 50; (3) completes at least five years of active service 
178.9 	as an active member of the municipal fire department to which the relief association is 
178.10 	associated; (4) completes at least five years of active membership with the relief association 
178.11 	before separation from active service; and (5) complies with any additional conditions as 
178.12 	to age, service, and membership that are prescribed by the bylaws of the relief association. 
178.13 	A service pension computed under this section may be prorated monthly for fractional years 
178.14 	of service as the bylaws or articles of incorporation of the relief association so provide. The 
178.15 	bylaws or articles of incorporation may define a "month," but the definition must require a 
178.16 	calendar month to have at least 16 days of active service. If the bylaws or articles of 
178.17 	incorporation do not define a "month," a "month" is a completed calendar month of active 
178.18 	service measured from the member's date of entry to the same date in the subsequent month. 
178.19 	The service pension earned by a volunteer firefighter under this chapter and the articles of 
178.20 	incorporation and bylaws of the volunteer firefighters relief association may be paid whether 
178.21 	or not the municipality or independent nonprofit firefighting corporation to which the relief 
178.22 	association is associated qualifies for the receipt of fire state aid under chapter 69.
178.23 	(b) In the case of a member who has completed at least five years of active service as 
178.24 	an active member of the fire department to which the relief association is associated on the 
178.25 	date that the relief association is established and incorporated, the requirement that the 
178.26 	member complete at least five years of active membership with the relief association before 
178.27 	separation from active service may be waived by the board of trustees of the relief association 
178.28 	if the member completes at least five years of inactive membership with the relief association 
178.29 	before the date of the payment of the service pension. During the period of inactive 
178.30 	membership, the member is not entitled to receive disability benefit coverage, is not entitled 
178.31 	to receive additional service credit towards computation of a service pension, and is 
178.32 	considered to have the status of a person entitled to a deferred service pension under 
178.33 	subdivision 7.
179.1 	(c) No municipality or, independent nonprofit firefighting corporation, or joint powers 
179.2 	entity may delegate the power to take final action in setting a service pension or ancillary 
179.3 	benefit amount or level to the board of trustees of the relief association or to approve in 
179.4 	advance a service pension or ancillary benefit amount or level equal to the maximum amount 
179.5 	or level that this chapter would allow rather than a specific dollar amount or level.

179.6 	EFFECTIVE DATE. This section is effective January 1, 2019.

179.7 	Sec. 17. Minnesota Statutes 2016, section 424A.02, subdivision 3a, is amended to read:
179.8 		Subd. 3a.Penalty for paying pension greater than applicable maximum. (a) If a 
179.9 	defined benefit relief association pays a service pension greater than the maximum service 
179.10 	pension associated with the applicable average amount of available financing per active 
179.11 	covered firefighter under the table in subdivision 3, paragraph (c) or (d), whichever applies, 
179.12 	the maximum service pension under subdivision 3, paragraph (f), or the applicable maximum 
179.13 	service pension amount specified in subdivision 3, paragraph (g), whichever is less, the 
179.14 	state auditor shall:
179.15 	(1) disqualify the municipality or the independent nonprofit firefighting corporation 
179.16 	associated with the relief association from receiving fire state aid by making the appropriate 
179.17 	notification to the municipality and the commissioner of revenue, with the disqualification 
179.18 	applicable for the next apportionment and payment of fire state aid; and
179.19 	(2) order the treasurer of the applicable relief association to recover the amount of the 
179.20 	overpaid service pension or pensions from any retired firefighter who received an 
179.21 	overpayment.
179.22 	(b) Fire state aid amounts from disqualified municipalities for the period of 
179.23 	disqualifications under paragraph (a), clause (1), must be credited to the amount of fire 
179.24 	insurance premium tax proceeds available for the next subsequent fire state aid 
179.25 	apportionment.
179.26 	(c) The amount of any overpaid service pension recovered under paragraph (a), clause 
179.27 	(2), must be credited to the amount of fire insurance premium tax proceeds available for 
179.28 	the next subsequent fire state aid apportionment.
179.29 	(d) The determination of the state auditor that a relief association has paid a service 
179.30 	pension greater than the applicable maximum must be made on the basis of the information 
179.31 	filed by the relief association and the municipality with the state auditor under sections 
179.32 	69.011, subdivision 2, and 69.051, subdivision 1 or 1a, whichever applies, and any other 
179.33 	relevant information that comes to the attention of the state auditor. The determination of 
180.1 	the state auditor is final. An aggrieved municipality, relief association, or person may appeal 
180.2 	the determination under section 480A.06.
180.3 	(e) The state auditor may certify, upon learning that a relief association overpaid a service 
180.4 	pension based on an error in the maximum service pension calculation, the municipality or 
180.5 	independent nonprofit firefighting corporation associated with the relief association for fire 
180.6 	state aid if (1) there is evidence that the error occurred in good faith, and (2) the relief 
180.7 	association has initiated recovery of any overpayment amount. Notwithstanding paragraph 
180.8 	(c), all overpayments recovered under this paragraph must be credited to the relief 
180.9 	association's special fund.

180.10 	EFFECTIVE DATE. This section is effective January 1, 2019.

180.11 	Sec. 18. Minnesota Statutes 2016, section 424A.02, subdivision 7, is amended to read:
180.12 		Subd. 7.Deferred service pensions. (a) A member of a defined benefit relief association 
180.13 	is entitled to a deferred service pension if the member separates from active service and 
180.14 	membership and has completed the minimum service and membership requirements in 
180.15 	subdivision 1. The requirement that a member separate from active service and membership 
180.16 	is waived for persons who have discontinued their volunteer firefighter duties and who are 
180.17 	employed on a full-time basis under section 424A.015, subdivision 1.
180.18 	(b) The deferred service pension is payable when the former member reaches at least 
180.19 	age 50, or at least the minimum age specified in the bylaws governing the relief association 
180.20 	if that age is greater than age 50, and when the former member makes a valid written 
180.21 	application.
180.22 	(c) A defined benefit relief association that provides a lump-sum service pension governed 
180.23 	by subdivision 3 may, when its governing bylaws so provide, pay interest on the deferred 
180.24 	lump-sum service pension during the period of deferral. If provided for in the bylaws, interest 
180.25 	must be paid in one of the following manners:
180.26 	(1) at the investment performance rate actually earned on that portion of the assets if the 
180.27 	deferred benefit amount is invested by the relief association in a separate account established 
180.28 	and maintained by the relief association;
180.29 	(2) at the investment performance rate actually earned on that portion of the assets if the 
180.30 	deferred benefit amount is invested in a separate investment vehicle held by the relief 
180.31 	association; or
180.32 	(3) at an interest rate of up to five percent, compounded annually, as set by the board of 
180.33 	trustees.
181.1 	(d) Any change in the interest rate set by the board of trustees under paragraph (c), clause 
181.2 	(3), must be ratified by the governing body of the municipality or joint powers entity served 
181.3 	by the fire department to which the relief association is directly associated, or by the 
181.4 	independent nonprofit firefighting corporation, as applicable.
181.5 	(e) Interest under paragraph (c), clause (3), is payable beginning on the January 1 next 
181.6 	following the date on which the deferred service pension interest rate as set by the board of 
181.7 	trustees was ratified by the governing body of the municipality or joint powers entity served 
181.8 	by the fire department to which the relief association is directly associated, or by the 
181.9 	independent nonprofit firefighting corporation, as applicable.
181.10 	(f) Unless the bylaws of a relief association that has elected to pay interest or additional 
181.11 	investment performance on deferred lump-sum service pensions under paragraph (c) specifies 
181.12 	a different interest or additional investment performance method, including the interest or 
181.13 	additional investment performance period starting date and ending date, the interest or 
181.14 	additional investment performance on a deferred service pension is creditable as follows:
181.15 	(1) for a relief association that has elected to pay interest or additional investment 
181.16 	performance under paragraph (c), clause (1) or (3), beginning on the first day of the month 
181.17 	next following the date on which the member separates from active service and membership 
181.18 	and ending on the last day of the month immediately before the month in which the deferred 
181.19 	member commences receipt of the deferred service pension; or
181.20 	(2) for a relief association that has elected to pay interest or additional investment 
181.21 	performance under paragraph (c), clause (2), beginning on the date that the member separates 
181.22 	from active service and membership and ending on the date that the separate investment 
181.23 	vehicle is valued immediately before the date on which the deferred member commences 
181.24 	receipt of the deferred service pension.
181.25 	(g) For a deferred service pension that is transferred to a separate account established 
181.26 	and maintained by the relief association or separate investment vehicle held by the relief 
181.27 	association, the deferred member bears the full investment risk subsequent to transfer and 
181.28 	in calculating the accrued liability of the volunteer firefighters relief association that pays 
181.29 	a lump-sum service pension, the accrued liability for deferred service pensions is equal to 
181.30 	the separate relief association account balance or the fair market value of the separate 
181.31 	investment vehicle held by the relief association.

181.32 	EFFECTIVE DATE. This section is effective January 1, 2019.

182.1 	Sec. 19. Minnesota Statutes 2016, section 424A.04, subdivision 1, is amended to read:
182.2 		Subdivision 1.Membership. (a) A relief association that is directly associated with a 
182.3 	municipal fire department must be managed by a board of trustees consisting of nine 
182.4 	members. Six trustees must be elected from the membership of the relief association and 
182.5 	three trustees must be drawn from the officials of the municipalities served by the fire 
182.6 	department to which the relief association is directly associated. The bylaws of a relief 
182.7 	association which provides a monthly benefit service pension may provide that one of the 
182.8 	six trustees elected from the relief association membership may be a retired member receiving 
182.9 	a monthly pension who is elected by the membership of the relief association. The three 
182.10 	municipal trustees must be one elected municipal official and one elected or appointed 
182.11 	municipal official who are designated as municipal representatives by the municipal 
182.12 	governing board annually and the chief of the municipal fire department.
182.13 	(b) A relief association that is a subsidiary of an independent nonprofit firefighting 
182.14 	corporation must be managed by a board of trustees consisting of nine members. Six trustees 
182.15 	must be elected from the membership of the relief association, two trustees must be drawn 
182.16 	from the officials of the municipalities served by the fire department to which the relief 
182.17 	association is directly associated, and one trustee must be the fire chief serving with the 
182.18 	independent nonprofit firefighting corporation. The bylaws of a relief association may 
182.19 	provide that one of the six trustees elected from the relief association membership may be 
182.20 	a retired member receiving a monthly pension who is elected by the membership of the 
182.21 	relief association. The two municipal trustees must be elected or appointed municipal 
182.22 	officials, selected as follows:
182.23 	(1) if only one municipality contracts with the independent nonprofit firefighting 
182.24 	corporation, the municipal trustees must be two officials of the contracting municipality 
182.25 	who are designated annually by the governing body of the municipality; or
182.26 	(2) if two or more municipalities contract with the independent nonprofit corporation, 
182.27 	the municipal trustees must be one official from each of the two largest municipalities in 
182.28 	population who are designated annually by the governing bodies of the applicable 
182.29 	municipalities.
182.30 	(c) The municipal trustees for a relief association that is directly associated with a fire 
182.31 	department operated as or by a joint powers entity must be the fire chief of the fire department 
182.32 	and two trustees designated annually by the joint powers board. The municipal trustees for 
182.33 	a relief association that is directly associated with a fire department service area township 
183.1 	must be the fire chief of the fire department and two trustees designated by the township 
183.2 	board.
183.3 	(d) If a relief association lacks the municipal board members provided for in paragraph 
183.4 	(a), (b), or (c) because the fire department is not located in or associated with an organized
183.5 	a municipality, or joint powers entity, or township, the municipal board members must be 
183.6 	the fire chief of the fire department and two board members appointed from the fire 
183.7 	department service area by the board of commissioners of the applicable county.
183.8 	(e) The term of the appointed municipal board members is one year or until the person's 
183.9 	successor is qualified, whichever is later.
183.10 	(f) A municipal trustee under paragraph (a), (b), (c), or (d) has all the rights and duties 
183.11 	accorded to any other trustee, except the right to be an officer of the relief association board 
183.12 	of trustees.
183.13 	(g) A board must have at least three officers, who are a president, a secretary and a 
183.14 	treasurer. These officers must be elected from among the elected trustees by either the full 
183.15 	board of trustees or by the relief association membership, as specified in the bylaws. In no 
183.16 	event may any trustee hold more than one officer position at any one time. The terms of the 
183.17 	elected trustees and of the officers of the board must be specified in the bylaws of the relief 
183.18 	association, but may not exceed three years. If the term of the elected trustees exceeds one 
183.19 	year, the election of the various trustees elected from the membership must be staggered 
183.20 	on as equal a basis as is practicable.

183.21 	EFFECTIVE DATE. This section is effective January 1, 2019.

183.22 	Sec. 20. Minnesota Statutes 2016, section 424A.07, is amended to read:
183.23 	424A.07 NONPROFIT FIREFIGHTING CORPORATIONS; ESTABLISHMENT 
183.24 	OF RELIEF ASSOCIATIONS.
183.25 	Before paying any service pensions or retirement benefits under section 424A.02 or 
183.26 	before becoming entitled to receive any amounts of fire state aid upon transmittal from a 
183.27 	contracting municipality under section 69.031, subdivision 5, a an independent nonprofit 
183.28 	firefighting corporation shall establish a volunteer firefighters relief association governed 
183.29 	by this chapter.

183.30 	EFFECTIVE DATE. This section is effective January 1, 2019.

184.1 	Sec. 21. Minnesota Statutes 2016, section 424A.091, subdivision 3, is amended to read:
184.2 		Subd. 3.Remedy for noncompliance; determination. (a) A municipality in which 
184.3 	there exists a firefighters relief association as specified in subdivision 1 which does not 
184.4 	comply with the applicable provisions of sections 424A.091 to 424A.096 or the provisions 
184.5 	of any applicable special law relating to the funding or financing of the association does 
184.6 	not qualify initially to receive, and is not entitled subsequently to retain, fire state aid under 
184.7 	sections 69.011 to 69.051 until the reason for the disqualification specified by the state 
184.8 	auditor is remedied, whereupon the municipality or relief association, if otherwise qualified, 
184.9 	is entitled to again receive fire state aid for the year occurring immediately subsequent to 
184.10 	the year in which the disqualification is remedied.
184.11 	(b) The state auditor shall determine if a municipality to which a firefighters' relief 
184.12 	association is directly associated or a firefighters relief association fails to comply with the 
184.13 	provisions of sections 424A.091 to 424A.096 or the funding or financing provisions of any 
184.14 	applicable special law based upon the information contained in the annual financial report 
184.15 	of the firefighters relief association required under section 69.051, the actuarial valuation 
184.16 	of the relief association, if applicable, the relief association officers' financial requirements 
184.17 	of the relief association and minimum municipal obligation determination documentation 
184.18 	under section 424A.092, subdivisions 3 and 4; 424A.093, subdivisions 4 and 5; or 424A.094, 
184.19 	subdivision 2, if requested to be filed by the state auditor, the applicable municipal or 
184.20 	independent nonprofit firefighting corporation budget, if requested to be filed by the state 
184.21 	auditor, and any other relevant documents or reports obtained by the state auditor.
184.22 	(c) The municipality or independent nonprofit firefighting corporation and the associated 
184.23 	relief association are not eligible to receive or to retain fire state aid if:
184.24 	(1) the relief association fails to prepare or to file the financial report or financial 
184.25 	statement under section 69.051;
184.26 	(2) the relief association treasurer is not bonded in the manner and in the amount required 
184.27 	by section 69.051, subdivision 2;
184.28 	(3) the relief association officers fail to determine or improperly determine the accrued 
184.29 	liability and the annual accruing liability of the relief association under section 424A.092, 
184.30 	subdivisions 2, 2a, and 3, paragraph (c), clause (2), if applicable;
184.31 	(4) if applicable, the relief association officers fail to obtain and file a required actuarial 
184.32 	valuation or the officers file an actuarial valuation that does not contain the special fund 
184.33 	actuarial liability calculated under the entry age normal actuarial cost method, the special 
184.34 	fund current assets, the special fund unfunded actuarial accrued liability, the special fund 
185.1 	normal cost under the entry age normal actuarial cost method, the amortization requirement 
185.2 	for the special fund unfunded actuarial accrued liability by the applicable target date, a 
185.3 	summary of the applicable benefit plan, a summary of the membership of the relief 
185.4 	association, a summary of the actuarial assumptions used in preparing the valuation, and a 
185.5 	signed statement by the actuary attesting to its results and certifying to the qualifications of 
185.6 	the actuary as an approved actuary under section 356.215, subdivision 1, paragraph (c);
185.7 	(5) the municipality failed to provide a municipal contribution, or the independent 
185.8 	nonprofit firefighting corporation failed to provide a corporate contribution, in the amount 
185.9 	equal to the minimum municipal obligation if the relief association is governed under section 
185.10 	424A.092, or the amount necessary, when added to the fire state aid actually received in 
185.11 	the plan year in question, to at least equal in total the calculated annual financial requirements 
185.12 	of the special fund of the relief association if the relief association is governed under section 
185.13 	424A.093, and, if the municipal or corporate contribution is deficient, the municipality 
185.14 	failed to include the minimum municipal obligation certified under section 424A.092, 
185.15 	subdivision 3, or 424A.093, subdivision 5, in its budget and tax levy or the independent 
185.16 	nonprofit firefighting corporation failed to include the minimum corporate obligation certified 
185.17 	under section 424A.094, subdivision 2, in the corporate budget;
185.18 	(6) the defined benefit relief association did not receive municipal ratification for the 
185.19 	most recent plan amendment when municipal ratification was required under section 424A.02, 
185.20 	subdivision 10; 424A.092, subdivision 6; or 424A.093, subdivision 6;
185.21 	(7) the relief association invested special fund assets in an investment security that is 
185.22 	not authorized under section 424A.095;
185.23 	(8) the relief association had an administrative expense that is not authorized under 
185.24 	section 69.80 or 424A.05, subdivision 3, or the municipality had an expenditure that is not 
185.25 	authorized under section 424A.08;
185.26 	(9) the relief association officers fail to provide a complete and accurate public pension 
185.27 	plan investment portfolio and performance disclosure under section 356.219;
185.28 	(10) the relief association fails to obtain the acknowledgment from a broker of the 
185.29 	statement of investment restrictions under section 356A.06, subdivision 8b;
185.30 	(11) the relief association officers permitted to occur a prohibited transaction under 
185.31 	section 356A.06, subdivision 9, or 424A.04, subdivision 2a, or failed to undertake correction 
185.32 	of a prohibited transaction that did occur; or
186.1 	(12) the relief association pays a defined benefit service pension in an amount that is in 
186.2 	excess of the applicable service pension maximum under section 424A.02, subdivision 3.

186.3 	EFFECTIVE DATE. This section is effective January 1, 2019.

186.4 	Sec. 22. Minnesota Statutes 2016, section 424A.094, subdivision 3, is amended to read:
186.5 		Subd. 3.Authorized pension disbursements. Authorized disbursements of assets of 
186.6 	the special fund of the subsidiary relief association of the independent nonprofit firefighting 
186.7 	corporation shall be governed by the provisions of section 424A.05.

186.8 	EFFECTIVE DATE. This section is effective January 1, 2019.

186.9 	Sec. 23. Minnesota Statutes 2016, section 424A.10, subdivision 1, is amended to read:
186.10 		Subdivision 1. Definitions. For purposes of this section:
186.11 	(1) "qualified recipient" means an individuala volunteer firefighter who receives a 
186.12 	lump-sum distribution of pension or retirement benefits from a volunteer firefighters relief 
186.13 	association or from the voluntary statewide lump-sum volunteer firefighter retirement plan
186.14 	for service that the individual has performed as a volunteer firefighter;
186.15 	(2) "survivor of a deceased active or deferred volunteer firefighter" means the surviving 
186.16 	spouse of a deceased active or deferred volunteer firefighter or, if none, the surviving child 
186.17 	or children of a deceased active or deferred volunteer firefighter;
186.18 	(3) "active volunteer firefighter" means a person who:
186.19 	(i) regularly renders fire suppression service, the performance or supervision of authorized 
186.20 	fire prevention duties, or the performance or supervision of authorized emergency medical 
186.21 	response activities for a municipal fire department or an independent nonprofit firefighting 
186.22 	corporation, who;
186.23 	(ii) has met the statutory and other requirements for relief association membership,; and 
186.24 	who
186.25 	(iii) is deemed by the relief association under law and its bylaws to be a fully qualified 
186.26 	member of the relief association or from the voluntary statewide lump-sum volunteer 
186.27 	firefighter retirement plan for at least one month; and
186.28 	(4) "deferred volunteer firefighter" means a former active volunteer firefighter who:
187.1 	(i) terminated active firefighting service, the performance or supervision of authorized 
187.2 	fire prevention duties, or the performance or supervision of authorized emergency medical 
187.3 	response activities; and
187.4 	(ii) has sufficient service credit from the applicable relief association or from the voluntary 
187.5 	statewide lump-sum volunteer firefighter retirement plan to be entitled to a service pension 
187.6 	under the bylaws of the relief association, but has not applied for or has not received the 
187.7 	service pension.; and
187.8 	(5) "volunteer firefighter" includes an individual whose services were utilized to perform 
187.9 	or supervise fire prevention duties if authorized under section 424A.01, subdivision 5, and 
187.10 	individuals whose services were used to perform emergency medical response duties or 
187.11 	supervise emergency medical response activities if authorized under section 424A.01, 
187.12 	subdivision 5a.

187.13 	EFFECTIVE DATE. This section is effective January 1, 2019.

187.14 	Sec. 24. Minnesota Statutes 2016, section 424B.20, subdivision 4, is amended to read:
187.15 		Subd. 4.Benefit trust fund establishment. (a) After the settlement of nonbenefit legal 
187.16 	obligations of the special fund of the volunteer firefighters relief association under subdivision 
187.17 	3, the board of the relief association shall transfer the remaining assets of the special fund, 
187.18 	as securities or in cash, as applicable, to the chief financial official of the municipality in 
187.19 	which the associated fire department was located if the fire department was a municipal fire 
187.20 	department or to the chief financial official of the municipality with the largest population 
187.21 	served by the fire department if the fire department was an independent nonprofit firefighting 
187.22 	corporation. If the fire department was a joint powers entity, the remaining assets of the 
187.23 	special fund shall be transferred to the chief financial official of the municipality designated 
187.24 	as the fiscal agent in the joint powers agreement or, if the agreement does not designate a 
187.25 	municipality as the fiscal agent, the remaining assets of the special fund shall be transferred 
187.26 	to the chief financial official of the municipality with the largest population served by the 
187.27 	joint powers fire department. The board shall also compile a schedule of the relief association 
187.28 	members to whom a service pension is or will be owed, any beneficiary to whom a benefit 
187.29 	is owed, the amount of the service pension or benefit payable based on the applicable bylaws 
187.30 	and state law and the service rendered to the date of the dissolution, and the date on which 
187.31 	the pension or benefit would first be payable under the bylaws of the relief association and 
187.32 	state law.
187.33 	(b) The municipality in which is locatedreceiving the remaining assets of the special 
187.34 	fund of a volunteer firefighters relief association that is dissolving under this section shall 
188.1 	establish a separate account in the municipal treasury which must function as a trust fund 
188.2 	for members of the volunteer firefighters relief association and their beneficiaries to whom 
188.3 	the volunteer firefighters relief association owes a service pension or other benefit under 
188.4 	the bylaws of the relief association and state law. Upon proper application, on or after the 
188.5 	initial date on which the service pension or benefit is payable, the municipal treasurer shall 
188.6 	pay the pension or benefit due, based on the schedule prepared under paragraph (a) and the 
188.7 	other records of the dissolved relief association. The trust fund under this section must be 
188.8 	invested and managed consistent with chapter 356A and section 424A.095. Upon payment 
188.9 	of the last service pension or benefit due and owing, any remaining assets in the trust fund 
188.10 	cancel to the general fund of the municipality.or, if the fire department was a joint powers 
188.11 	entity, any remaining assets in the trust fund cancel to the general fund of each municipality 
188.12 	that was a contracting party to the joint powers agreement as specified in the joint powers 
188.13 	agreement. If the joint powers agreement does not specify how the remaining assets are to 
188.14 	be distributed among the contracting parties, each of the contracting parties shall receive a 
188.15 	pro rata share of the remaining assets based on the proportion of total operating contributions 
188.16 	each contracting municipality made to the joint powers entity over the most recent ten 
188.17 	calendar years. If the special fund of the volunteer firefighters relief association had an 
188.18 	unfunded actuarial accrued liability upon dissolution, the municipality is liable for that 
188.19 	unfunded actuarial accrued liability. If the fire department was a joint powers entity, the 
188.20 	contracting municipalities are liable for their share of the unfunded actuarial accrued liability 
188.21 	as specified in the joint powers agreement. If the joint powers agreement does not specify 
188.22 	liability for any unfunded actuarial accrued liability, the contracting municipalities are liable 
188.23 	for their pro rata share of the unfunded actuarial accrued liability based on the proportion 
188.24 	of total operating contributions each contracting municipality made to the joint powers 
188.25 	entity over the most recent ten calendar years.

188.26 	EFFECTIVE DATE. This section is effective January 1, 2019.

188.27 	Sec. 25. CITY OF AUSTIN; ALLOCATION OF FIRE STATE AID FOR 
188.28 	FIREFIGHTERS.
 188.29 	(a) Notwithstanding any law to the contrary, the city of Austin must annually:
188.30 	(1) determine the amount of state aid required under the bylaws of the Austin Parttime 
188.31 	Firefighters Relief Association to fund the volunteer firefighters' service pensions;
188.32 	(2) transmit to the Austin Parttime Firefighters Relief Association any supplemental 
188.33 	state aid received under Minnesota Statutes, section 423A.022;
189.1 	(3) transmit to the Austin Parttime Firefighters Relief Association an amount of fire 
189.2 	state aid under Minnesota Statutes, sections 69.011 to 69.051, equal to the difference between 
189.3 	the amount determined under clause (1) and the amount transmitted under clause (2); and
189.4 	(4) transmit the remaining balance of fire state aid under Minnesota Statutes, sections 
189.5 	69.011 to 69.051, for the payment of the employer contribution requirements for firefighters 
189.6 	covered by the public employees police and fire retirement plan under Minnesota Statutes, 
189.7 	section 353.65, subdivision 3.
189.8 	(b) Notwithstanding Minnesota Statutes, section 69.031, subdivision 5, the city of Austin 
189.9 	has no liability to the relief association related to payments it made or will make to the 
189.10 	public employees police and fire retirement plan from fire state aid for 2013, 2014, 2015, 
189.11 	2016, 2017, and 2018.
189.12 	(c) This section expires July 1, 2019.

189.13 	EFFECTIVE DATE. This section is effective the day after the governing body of the 
189.14 	city of Austin and its chief clerical officer comply with Minnesota Statutes, section 645.021, 
189.15 	subdivisions 2 and 3, and applies retroactively from January 1, 2013.

189.16 	Sec. 26. FIRE STATE AID WORK GROUP.
 189.17 	(a) The executive director of the Public Employees Retirement Association shall convene 
189.18 	a Fire State Aid Work Group to study and make recommendations to the Legislative 
189.19 	Commission on Pensions and Retirement on:
189.20 	(1) the current requirement that all fire state aid provided to municipalities with 
189.21 	firefighters as defined in Minnesota Statutes, section 353G.01, subdivision 15, or 424A.001, 
189.22 	subdivision 10, must be used to fund service pensions governed by Minnesota Statutes, 
189.23 	chapter 353G or 424A; and
189.24 	(2) modifying the requirement to allow municipalities to allocate a portion of fire state 
189.25 	aid to pay employer contributions on behalf of firefighters covered by the public employees 
189.26 	police and fire retirement plan under Minnesota Statutes, section 353.65, subdivision 3.
189.27 	(b) In making recommendations with information provided by Public Employees 
189.28 	Retirement Association and Legislative Commission on Pensions and Retirement staff, the 
189.29 	work group shall consider:
189.30 	(1) the history and purpose of fire state aid;
190.1 	(2) the history, purpose, and utilization of Minnesota Statutes 2012, section 353A.10, 
190.2 	subdivision 6, which allowed certain municipalities to allocate a portion of fire state aid to 
190.3 	pay public employees police and fire employer contributions;
190.4 	(3) the impact on current volunteer firefighters, volunteer firefighter recruitment and 
190.5 	retention, and municipalities if fire state aid is allocated between service pensions and public 
190.6 	employees police and fire employer contributions; and
190.7 	(4) a presentation by a city of Austin official and a representative from the Austin Parttime 
190.8 	Firefighters Relief Association on the city of Austin's current allocation of fire state aid.
190.9 	(c) Members of the work group shall include:
190.10 	(1) two representatives of Minnesota cities, appointed by the League of Minnesota Cities;
190.11 	(2) two representatives of Minnesota fire chiefs, who are fire chiefs from fire departments 
190.12 	with both volunteer firefighters covered by either a volunteer firefighter relief association 
190.13 	governed by Minnesota Statutes, chapter 424A, or the voluntary statewide volunteer 
190.14 	firefighter retirement plan governed by Minnesota Statutes, chapter 353G, and firefighters 
190.15 	covered by the public employees police and fire retirement plan governed by Minnesota 
190.16 	Statutes, section 353.64, appointed by the Minnesota State Fire Chiefs Association;
190.17 	(3) two representatives of Minnesota volunteer firefighters, who are active volunteer 
190.18 	firefighters, appointed by the Minnesota State Fire Departments Association;
190.19 	(4) one representative of the Office of the State Auditor, designated by the state auditor; 
190.20 	and
190.21 	(5) one representative of the Department of Revenue, designated by the commissioner 
190.22 	of revenue.
190.23 	(d) The work group shall elect a chair from among its members.
190.24 	(e) The work group shall submit a report by December 31, 2018, that contains the work 
190.25 	group's recommendations to the chair, vice-chair, and executive director of the Legislative 
190.26 	Commission on Pensions and Retirement. The report shall include recommendations 
190.27 	regarding:
190.28 	(1) municipalities allocating a portion of fire state aid to pay employer contributions to 
190.29 	the public employees police and fire retirement plan;
190.30 	(2) implementation of policies if fire state aid is divided, including the determination 
190.31 	of:
190.32 	(i) the entities that will decide how the fire state aid is allocated;
191.1 	(ii) how the allocation will be documented;
191.2 	(iii) how the allocation may be amended, if at all;
191.3 	(iv) what entity allocates the fire state aid; and
191.4 	(v) whether a government agency must monitor and enforce the allocation;
191.5 	(3) the scope of allowable allocations of fire state aid; and
191.6 	(4) other issues the work group determines are relevant.
191.7 	(e) The work group expires the day following the last day of the 2019 legislative session.

191.8 	EFFECTIVE DATE. This section is effective the day following final enactment.

191.9 	Sec. 27. EDEN PRAIRIE VOLUNTEER FIREFIGHTERS RELIEF ASSOCIATION 
191.10 	SERVICE PENSIONS.
 191.11 		Subdivision 1.Lump-sum service pension maximum. (a) Notwithstanding any provision 
191.12 	of Minnesota Statutes, section 424A.02, subdivision 3, paragraph (d), to the contrary, the 
191.13 	maximum lump-sum pension amount for each year of service credited that may be provided 
191.14 	for in the bylaws of the Eden Prairie volunteer firefighters relief association is the maximum 
191.15 	service pension figure corresponding to the average amount of available financing per active 
191.16 	covered firefighter for the applicable specified period:

191.17
191.18191.19	Minimum Average Amount of Available Financing 
per Firefighter
	Maximum Lump-Sum Service 
Pension Amount Payable for Each 
Year of Service
	
191.20	$ ...
		$ 10
		
191.21	11
		20
		
191.22	16
		30
		
191.23	23
		40
		
191.24	27
		50
		
191.25	32
		60
		
191.26	43
		80
		
191.27	54
		100
		
191.28	65
		120
		
191.29	77
		140
		
191.30	86
		160
		
191.31	97
		180
		
191.32	108
		200
		
191.33	131
		240
		
191.34	151
		280
		
192.1	173
		320
		
192.2	194
		360
		
192.3	216
		400
		
192.4	239
		440
		
192.5	259
		480
		
192.6	281
		520
		
192.7	302
		560
		
192.8	324
		600
		
192.9	347
		640
		
192.10	367
		680
		
192.11	389
		720
		
192.12	410
		760
		
192.13	432
		800
		
192.14	486
		900
		
192.15	540
		1000
		
192.16	594
		1100
		
192.17	648
		1200
		
192.18	702
		1300
		
192.19	756
		1400
		
192.20	810
		1500
		
192.21	864
		1600
		
192.22	918
		1700
		
192.23	972
		1800
		
192.24	1026
		1900
		
192.25	1080
		2000
		
192.26	1134
		2100
		
192.27	1188
		2200
		
192.28	1242
		2300
		
192.29	1296
		2400
		
192.30	1350
		2500
		
192.31	1404
		2600
		
192.32	1458
		2700
		
192.33	1512
		2800
		
192.34	1566
		2900
		
192.35	1620
		3000
		
192.36	1672
		3100
		
192.37	1726
		3200
		
192.38	1753
		3250
		
193.1	1780
		3300
		
193.2	1820
		3375
		
193.3	1834
		3400
		
193.4	1888
		3500
		
193.5	1942
		3600
		
193.6	1996
		3700
		
193.7	2023
		3750
		
193.8	2050
		3800
		
193.9	2104
		3900
		
193.10	2158
		4000
		
193.11	2212
		4100
		
193.12	2265
		4200
		
193.13	2319
		4300
		
193.14	2373
		4400
		
193.15	2427
		4500
		
193.16	2481
		4600
		
193.17	2535
		4700
		
193.18	2589
		4800
		
193.19	2643
		4900
		
193.20	2697
		5000
		
193.21	2751
		5100
		
193.22	2805
		5200
		
193.23	2859
		5300
		
193.24	2913
		5400
		
193.25	2967
		5500
		
193.26	3021
		5600
		
193.27	3075
		5700
		
193.28	3129
		5800
		
193.29	3183
		5900
		
193.30	3237
		6000
		
193.31	3291
		6100
		
193.32	3345
		6200
		
193.33	3399
		6300
		
193.34	3453
		6400
		
193.35	3507
		6500
		
193.36	3561
		6600
		
193.37	3615
		6700
		
193.38	3669
		6800
		
194.1	3723
		6900
		
194.2	3777
		7000
		
194.3	3831
		7100
		
194.4	3885
		7200
		
194.5	3939
		7300
		
194.6	3993
		7400
		
194.7	4047
		7500
		
194.8	4101
		7600
		
194.9	4155
		7700
		
194.10	4209
		7800
		
194.11	4263
		7900
		
194.12	4317
		8000
		
194.13	4371
		8100
		
194.14	4425
		8200
		
194.15	4479
		8300
		
194.16	4533
		8400
		
194.17	4587
		8500
		
194.18	4641
		8600
		
194.19	4695
		8700
		
194.20	4749
		8800
		
194.21	4803
		8900
		
194.22	4857
		9000
		
194.23	4911
		9100
		
194.24	4965
		9200
		
194.25	5019
		9300
		
194.26	5073
		9400
		
194.27	5127
		9500
		
194.28	5181
		9600
		
194.29	5235
		9700
		
194.30	5289
		9800
		
194.31	5343
		9900
		
194.32	5397
		10,000
		
194.33	5451
		10,100
		
194.34	5505
		10,200
		
194.35	5559
		10,300
		
194.36	5613
		10,400
		
194.37	5667
		10,500
		
194.38	5721
		10,600
		
195.1	5775
		10,700
		
195.2	5729
		10,800
		
195.3	5883
		10,900
		
195.4	5937
		11,000
		
195.5	5991
		11,100
		
195.6	6045
		11,200
		
195.7	6099
		11,300
		
195.8	6153
		11,400
		
195.9	6207
		11,500
		
195.10	6261
		11,600
		
195.11	6315
		11,700
		
195.12	6369
		11,800
		
195.13	6423
		11,900
		
195.14	6477
		12,000
		
195.15	6531
		12,100
		
195.16	6585
		12,200
		
195.17	6639
		12,300
		
195.18	6693
		12,400
		
195.19	6747
		12,500
		
195.20	6801
		12,600
		
195.21	6855
		12,700
		
195.22	6909
		12,800
		
195.23	6963
		12,900
		
195.24	7017
		13,000
		
195.25	7071
		13,100
		
195.26	7125
		13,200
		
195.27	7179
		13,300
		
195.28	7233
		13,400
		
195.29	7287
		13,500
		
195.30	7341
		13,600
		
195.31	7395
		13,700
		
195.32	7449
		13,800
		
195.33	7503
		13,900
		
195.34	7557
		14,000
		
195.35	7611
		14,100
		
195.36	7665
		14,200
		
195.37	7719
		14,300
		
195.38	7773
		14,400
		
196.1	7827
		14,500
		
196.2	7881
		14,600
		
196.3	7935
		14,700
		
196.4	7989
		14,800
		
196.5	8043
		14,900
		
196.6	8097
		15,000
		
196.7	Any amount in excess of 8097
		15,000
		
196.8 	(b) The maximum monthly service pension amount per month for each year of service 
196.9 	credited that may be provided for in the bylaws of the Eden Prairie volunteer firefighters 
196.10 	relief association must be set pursuant to Minnesota Statutes, section 424A.02, subdivision 
196.11 	3, paragraph (c).
196.12 		Subd. 2.Return to active service. (a) Notwithstanding any provision of Minnesota 
196.13 	Statutes, section 424A.01, subdivision 6, 424A.02, subdivision 2, or any other provision of 
196.14 	law, to the contrary, if the bylaws of the Eden Prairie volunteer firefighters relief association 
196.15 	so provide, a former firefighter who has received a lump-sum service pension or is receiving 
196.16 	a monthly benefit service pension and returns to active relief association membership under 
196.17 	Minnesota Statutes, section 424A.01, subdivision 6, paragraph (b), is entitled to receive an 
196.18 	unreduced lump-sum service pension for the resumption service period if the firefighter 
196.19 	completes at least three years of active service as an active member of the fire department 
196.20 	during the resumption service period and completes at least three years of active membership 
196.21 	with the relief association during the resumption service period.
196.22 	(b) A lump-sum service pension must be calculated by applying the service pension 
196.23 	amount in effect on the date of the firefighter's termination of the resumption service for all 
196.24 	years of the resumption service. No firefighter may be paid a service pension more than 
196.25 	once for the same period of service. Payment of a lump-sum service pension shall have no 
196.26 	effect on the firefighter's previous service pension.

196.27 	EFFECTIVE DATE. This section is effective the day after the Eden Prairie city council 
196.28 	and its chief clerical officer timely complete their compliance with Minnesota Statutes, 
196.29 	section 645.021, subdivisions 2 and 3.

196.30 	Sec. 28.  REPEALER.
 196.31 	Minnesota Statutes 2016, section 424A.02, subdivision 13, is repealed.

196.32 	EFFECTIVE DATE. This section is effective January 1, 2019.

197.1 	ARTICLE 16
197.2 	MSRS-ADMINISTERED RETIREMENT PLAN MODIFICATIONS

197.3 	Section 1. Minnesota Statutes 2016, section 352.113, subdivision 2, is amended to read:
197.4 		Subd. 2.Application; accrual of benefits. (a) An employee making claim for a total 
197.5 	and permanent disability benefit, or someone acting on behalf of the employee upon proof 
197.6 	of authority satisfactory to the director, shall file a written application for benefits in the 
197.7 	office of the system on or before the deadline specified in subdivision 4, paragraph (g).
197.8 	(b) The application must be in a form and manner prescribed by the executive director.
197.9 	(c) The benefit shall begin to accrue the day following the start of disability or the day 
197.10 	following the last day paid, whichever is later, but not earlier than 180 days before the date 
197.11 	the application is filed with the director.

197.12 	EFFECTIVE DATE. This section is effective July 1, 2018.

197.13 	Sec. 2. Minnesota Statutes 2016, section 352.91, subdivision 3f, is amended to read:
197.14 		Subd. 3f.Additional Department of Human Services personnel. (a) "Covered 
197.15 	correctional service" means service by a state employee in one of the employment positions 
197.16 	specified in paragraph (b) in the state-operated forensic services program or the Minnesota 
197.17 	sex offender program if at least 75 percent of the employee's working time is spent in direct 
197.18 	contact with patients and the determination of this direct contact is certified to the executive 
197.19 	director by the commissioner of human services.
197.20 	(b) The employment positions are:
197.21 	(1) behavior analyst 2;
197.22 	(2) behavior analyst 3;
197.23 	(3) certified occupational therapy assistant 1;
197.24 	(4) certified occupational therapy assistant 2;
197.25 	(5) chemical dependency counselor senior;
197.26 	(6) client advocate;
197.27 	(7) clinical program therapist 2;
197.28 	(8) clinical program therapist 3;
197.29 	(9) clinical program therapist 4;
198.1 	(10) customer services specialist principal;
198.2 	(11) dental assistant registered;
198.3 	(12) group supervisor;
198.4 	(13) group supervisor assistant;
198.5 	(14) human services support specialist;
198.6 	(15) licensed alcohol and drug counselor;
198.7 	(16) licensed practical nurse;
198.8 	(17) management analyst 3;
198.9 	(18) occupational therapist;
198.10 	(19) occupational therapist, senior;
198.11 	(20) physical therapist;
198.12 	(20)(21) psychologist 1;
198.13 	(21)(22) psychologist 2;
198.14 	(22)(23) psychologist 3;
198.15 	(23)(24) recreation program assistant;
198.16 	(24)(25) recreation therapist lead;
198.17 	(25)(26) recreation therapist senior;
198.18 	(26)(27) rehabilitation counselor senior;
198.19 	(27)(28) security supervisor;
198.20 	(28)(29) skills development specialist;
198.21 	(29)(30) social worker senior;
198.22 	(30)(31) social worker specialist;
198.23 	(31)(32) social worker specialist, senior;
198.24 	(32)(33) special education program assistant;
198.25 	(33)(34) speech pathology clinician;
198.26 	(34)(35) work therapy assistant; and
198.27 	(35)(36) work therapy program coordinator.

199.1 	EFFECTIVE DATE. This section is effective on the first day of the first payroll period 
199.2 	occurring after the date of enactment and applies to prospective service only.

199.3 	Sec. 3. Minnesota Statutes 2016, section 352.91, subdivision 3g, is amended to read:
199.4 		Subd. 3g.Additional Corrections Department personnel. (a) "Covered correctional 
199.5 	service" means service by a state employee in one of the employment positions specified 
199.6 	in paragraph (b) if at least 75 percent of the employee's working time is spent in direct 
199.7 	contact with inmates and the determination of this direct contact is certified to the executive 
199.8 	director by the commissioner of corrections.
199.9 	(b) The qualifying employment positions are:
199.10 	(1) corrections discipline unit supervisor;
199.11 	(2) dental assistant registered;
199.12 	(3) dental hygienist;
199.13 	(4) food service supervisor;
199.14 	(5) medical assistant, certified;
199.15 	(6) psychologist 2; and
199.16 	(5)(7) sentencing to service crew leader involved with the inmate community work 
199.17 	crew program.

199.18 	EFFECTIVE DATE. This section is effective the day following final enactment.

199.19 	Sec. 4. Minnesota Statutes 2016, section 352.91, is amended by adding a subdivision to 
199.20 	read:
199.21 		Subd. 4c.Department of Human Services; procedure for coverage change 
199.22 	considerations. (a) The commissioner of human services shall appoint a standing review 
199.23 	committee to review and determine classifications or positions that may be included in 
199.24 	legislative requests for correctional state employees retirement plan coverage under 
199.25 	subdivision 4a.
199.26 	(b) The department's human resources director shall convene a meeting of the review 
199.27 	committee only at the request of a labor organization or a member of the department's 
199.28 	management team.
199.29 	(c) The review committee must review all requests and the supporting documentation 
199.30 	for coverage by the correctional state employees retirement plan and must make a 
200.1 	recommendation to the commissioner regarding which classifications or positions meet the 
200.2 	statutory requirements for coverage. The review committee must also make a 
200.3 	recommendation to the commissioner regarding classifications or positions that no longer 
200.4 	meet the statutory requirement for coverage by the correctional state employees retirement 
200.5 	plan and removal of the classification or position from the applicable statute.
200.6 	(d) The department's human resources director must provide a notice of each 
200.7 	determination and of the employee's right to appeal the determination. Appeals must be 
200.8 	filed with the department's human resources director within 30 days of the date of the notice 
200.9 	of determination.
200.10 	(e) The commissioner of human services shall review appeals of determinations for 
200.11 	coverage. The commissioner's determinations are final.
200.12 	(f) All classifications or positions recommended by the review committee for inclusion 
200.13 	in or exclusion from the correctional state employees retirement plan must be forwarded to 
200.14 	the commissioner of human services for the preparation of legislation to implement the 
200.15 	coverage change and submission. If the commissioner determines that the employment 
200.16 	position is appropriate for inclusion in or exclusion from the correctional state employees 
200.17 	retirement plan, the commissioner shall submit a written recommendation documenting 
200.18 	classifications or positions that should or should not be covered by the correctional state 
200.19 	employees retirement plan. The department's human resources director must retain the 
200.20 	documentation of each request and the final determination.

200.21 	EFFECTIVE DATE. This section is effective the day following final enactment.

200.22 	Sec. 5. Minnesota Statutes 2016, section 352F.04, subdivision 1, is amended to read:
200.23 		Subdivision 1.Enhanced augmentation rates. (a) The deferred annuity of a terminated 
200.24 	hospital employee who attained that status before June 2, 2006, is subject to augmentation 
200.25 	under Minnesota Statutes 1994, section 352.72, subdivision 2, except that the rate of 
200.26 	augmentation is 5.5 percent compounded annually untilto be applied each January 1 is the 
200.27 	following the year in which the person attains age 55.:

200.28		January 1, 2019
	4.5 percent
	
200.29		January 1, 2020
	3.75 percent
	
200.30		January 1, 2021
	3.0 percent
	
200.31		January 1, 2022
	2.25 percent
	
200.32		January 1, 2023
	1.5 percent
	
200.33		January 1, 2024
	0.75 percent
	
200.34		After December 31, 2024, the deferred annuity must not be augmented.
	
201.1 	Augmentation for each year is effective as of January 1 of that year.
201.2 	From that date to the effective date of retirement, the augmentation rate is 7.5 percent 
201.3 	compounded annually.
201.4 	(b) If a terminated hospital employee attained that status on or after June 2, 2006, the 
201.5 	augmentation rate is four percent compounded annually until January 1, following the year 
201.6 	in which the person attains age 55. From that date to the effective date of retirement, the 
201.7 	augmentation rate is six percent compounded annually.

201.8 	EFFECTIVE DATE. This section is effective the day following final enactment.

201.9 	Sec. 6. Minnesota Statutes 2016, section 352F.04, subdivision 2, is amended to read:
201.10 		Subd. 2.Exceptions Exception. The increasedenhanced augmentation rates specified 
201.11 	in subdivision 1 do not apply if the terminated hospital employee:
201.12 	(1) becomes covered again by a retirement plan enumerated in section 356.30, subdivision 
201.13 	3; or
201.14 	(2) begins receipt of a retirement annuity under chapter 352 before age 62 while employed 
201.15 	by the employer which assumed operations of the medical facility or other public employing 
201.16 	unit or purchased the medical facility or other public employing unit.

201.17 	EFFECTIVE DATE. This section is effective retroactively from July 1, 2015.

201.18 	Sec. 7. Minnesota Statutes 2016, section 352F.04, is amended by adding a subdivision to 
201.19 	read:
201.20 		Subd. 3.Return to covered employment. (a) If a terminated hospital employee becomes 
201.21 	covered by a retirement plan enumerated in section 356.30, subdivision 3, the employee 
201.22 	shall be entitled to whichever of the following annuities produces the highest monthly 
201.23 	payment:
201.24 	(1) the deferred annuity and augmentation to which the employee would have been 
201.25 	entitled under subdivision 1 reduced by the dollar amount of any annuity earned under any 
201.26 	enumerated retirement plan after the effective date defined in section 352F.02, subdivision 
201.27 	3;
201.28 	(2) a combined service annuity calculated under section 356.30; or
201.29 	(3) an annuity calculated under section 352.72 for coverage by more than one retirement 
201.30 	system using the augmentation rates in section 352.72, subdivision 2, paragraph (a).
202.1 	(b) This subdivision applies to any terminated hospital employee who begins to receive 
202.2 	a retirement annuity under chapter 352 on or after July 1, 2015.

202.3 	EFFECTIVE DATE. This section is effective the day following final enactment.

202.4 	Sec. 8. ANNUITY ADJUSTMENT.
 202.5 	Under Minnesota Statutes, section 352F.04, subdivision 3, if any terminated hospital 
202.6 	employee began to receive a retirement annuity under Minnesota Statutes, chapter 352, as 
202.7 	adjusted under Minnesota Statutes, chapter 352F, on or after July 1, 2015, but prior to the 
202.8 	effective date of this section, the terminated hospital employee's annuity must be recalculated 
202.9 	under Minnesota Statutes, section 352F.04, subdivision 3, and, if the monthly amount as 
202.10 	recalculated exceeds the monthly amount being received by the terminated hospital employee, 
202.11 	the Minnesota State Retirement System shall:
202.12 	(1) begin paying the recalculated monthly amount as of the first payment date after the 
202.13 	effective date of this section; and
202.14 	(2) pay the sum of the difference between the amount the terminated hospital employee 
202.15 	received each month since commencement of the annuity and the amount the terminated 
202.16 	hospital employee would have received under Minnesota Statutes, section 352F.04, 
202.17 	subdivision 3, for that month. The sum of the difference each month shall be paid in a lump 
202.18 	sum to the terminated hospital employee along with the first payment of the recalculated 
202.19 	amount under clause (1).

202.20 	EFFECTIVE DATE. This section is effective the day following final enactment.

202.21 	Sec. 9. COVERAGE TRANSFER DATES.
 202.22 	(a) The coverage transfer under Minnesota Statutes, section 352.91, subdivision 3g, 
202.23 	paragraph (b), clause (4), also covers employment in that position on or after April 18, 2016, 
202.24 	for purposes of Minnesota Statutes, section 352.955, subdivisions 1, 3, 4, 5, and 6.
202.25 	(b) The coverage change under Minnesota Statutes, section 352.91, subdivision 3g, 
202.26 	paragraph (b), clause (5), is prospective only.

202.27 	EFFECTIVE DATE. This section is effective the day following final enactment.

202.28 	ARTICLE 17
202.29 	PERA-ADMINISTERED RETIREMENT PLAN MODIFICATIONS

202.30 	Section 1. Minnesota Statutes 2016, section 353.01, subdivision 43, is amended to read:
203.1 		Subd. 43.Line of duty death. "Line of duty death" means:
203.2 	(1) a death that occurs while performing or as a direct result of performing normal or 
203.3 	less frequent duties which are specific to protecting the property and personal safety of 
203.4 	others and that present inherent dangers that are specific to the positions covered by the 
203.5 	public employees police and fire plan.; or
203.6 	(2) a death that is determined by the commissioner of public safety to meet the 
203.7 	requirements of section 299A.41, subdivision 3.

203.8 	EFFECTIVE DATE. This section is effective the day following final enactment.

203.9 	Sec. 2. Minnesota Statutes 2016, section 353G.01, subdivision 9, is amended to read:
203.10 		Subd. 9.Municipality. "Municipality" means a governmental entity specified in section 
203.11 	69.011, subdivision 1, paragraph (b), clauses (1), (2), and (5)., a city or township that has 
203.12 	entered into a contract with an independent nonprofit firefighting corporation, or a city or 
203.13 	township that has entered into a contract with a joint powers entity established under section 
203.14 	471.59.

203.15 	EFFECTIVE DATE. This section is effective the day following final enactment.

203.16 	Sec. 3. Minnesota Statutes 2016, section 353G.01, is amended by adding a subdivision to 
203.17 	read:
203.18 		Subd. 9a.Relief association. "Relief association" means a volunteer firefighter relief 
203.19 	association established under chapter 424A to which records, assets, and liabilities related 
203.20 	to lump-sum or monthly benefits for active and former firefighters will be transferred from 
203.21 	the retirement fund upon satisfaction of the requirements of section 353G.17.

203.22 	EFFECTIVE DATE. This section is effective the day following final enactment.

203.23 	Sec. 4. Minnesota Statutes 2016, section 353G.02, subdivision 6, is amended to read:
203.24 		Subd. 6.Initial administrative expenses of the monthly benefit retirement division; 
203.25 	allocation of reimbursement. (a) The administration expenses incurred by the Public 
203.26 	Employees Retirement Association in the establishment of the monthly benefit retirement 
203.27 	division of the voluntary statewide volunteer firefighter retirement plan, including any 
203.28 	computer programming expenses and any actuarial consultant expenses, are payable from 
203.29 	the assets of the initial monthly benefit volunteer firefighter relief association that elects to 
203.30 	transfer its administration to the voluntary statewide volunteer firefighter retirement plan, 
203.31 	following the transfer of assets.
204.1 	(b) The administrative expenses in excess of $33,600 paid under paragraph (a) must be 
204.2 	reimbursed by the next nine monthly benefit volunteer firefighter relief associations that 
204.3 	transfer plan administration to the voluntary statewide volunteer firefighter retirement plan. 
204.4 	The reimbursement charge for each of the nine is three-tenths of one percent of the market 
204.5 	value of assets of the volunteer firefighter relief association as of December 31, 2012. The 
204.6 	reimbursement amounts, up to the amount of administrative expenses actually incurred 
204.7 	under paragraph (a) in excess of $33,600, must be credited to the account of the fire 
204.8 	department associated with the former monthly benefit volunteer firefighter relief association 
204.9 	that first transferred plan administration to the volunteer firefighter retirement plan.

204.10 	EFFECTIVE DATE. This section is effective the day following final enactment.

204.11 	Sec. 5. Minnesota Statutes 2016, section 353G.03, subdivision 3, is amended to read:
204.12 		Subd. 3.Composition. (a) The advisory board consists of eightten members.
204.13 	(b) The advisory board members are:
204.14 	(1) one representative of Minnesota townships, appointed by the Minnesota Association 
204.15 	of Townships;
204.16 	(2) two representatives of Minnesota cities, appointed by the League of Minnesota Cities;
204.17 	(3) one representative of Minnesota fire chiefs, who is a fire chief, appointed by the 
204.18 	Minnesota State Fire Chiefs Association;
204.19 	(4) two representatives of Minnesota volunteer firefighters, all who are active volunteer 
204.20 	firefighters, one of whom is covered by the lump-sum retirement division and one of whom 
204.21 	is covered by the monthly benefit retirement division, appointed by the Minnesota State 
204.22 	Fire Chiefs Association;
204.23 	(5) one representative three representatives of Minnesota volunteer firefighters who is
204.24 	are covered by the lump-sum retirement division, appointed by the Minnesota State Fire 
204.25 	Departments Association; and
204.26 	(6) one representative of the Office of the State Auditor, designated by the state auditor.

204.27 	Sec. 6. Minnesota Statutes 2016, section 353G.08, subdivision 3, is amended to read:
204.28 		Subd. 3.Authorized account disbursements.  The assets of a lump-sum retirement 
204.29 	account or of a monthly benefit retirement account of the retirement fund may only be 
204.30 	disbursed for:
204.31 	(1) the administrative expenses of the retirement plan;
205.1 	(2) the investment expenses of the retirement fund;
205.2 	(3) the service pensions payable under section 353G.10, 353G.11, 353G.14, or 353G.15;
205.3 	(4) the survivor benefits payable under section 353G.12; and
205.4 	(5) the disability benefit coverage insurance premiums under section 353G.115; and
205.5 	(6) a transfer of assets under section 353G.17.

205.6 	EFFECTIVE DATE. This section is effective the day following final enactment.

205.7 	Sec. 7. Minnesota Statutes 2016, section 353G.11, subdivision 1, is amended to read:
205.8 		Subdivision 1.Service pension levels; lump-sum retirement division. Except as 
205.9 	provided in subdivision 1a, the lump-sum retirement division of the retirement plan provides 
205.10 	the following levels of service pension amounts per full year of good time service credit to 
205.11 	be selected at the election of coverage:
205.12 	(1) a minimum service pension level of $500 per year;
205.13 	(2) a maximum service pension level of $7,500 per year equal to the largest amount 
205.14 	permitted under section 424A.02, subdivision 3, paragraph (d), as a maximum lump-sum 
205.15 	service pension amount payable for each year of service; and
205.16 	(3) 69 service pension levels between the minimum level and the maximum level in 
205.17 	$100 increments.

205.18 	EFFECTIVE DATE. This section is effective the day following final enactment.

205.19 	Sec. 8. [353G.17] TRANSFER AUTHORIZED.
205.20 		Subdivision 1.Entity to initiate transfer. (a) An entity operating a fire department with 
205.21 	firefighters who are covered by the retirement plan may initiate the transfer of records, 
205.22 	assets, and liabilities related to the firefighters' lump-sum or monthly benefits under the 
205.23 	retirement plan to a relief association that, at the time of the transfer, will be associated with 
205.24 	the entity. The entity may be a municipality, an independent nonprofit firefighting 
205.25 	corporation, or a joint powers entity.
205.26 	(b) A transfer is initiated by filing with the executive director the following:
205.27 	(1) a notice of intent to initiate a transfer;
205.28 	(2) a copy of the resolutions of the entity approving the transfer of records, assets, and 
205.29 	liabilities from the retirement plan to a relief association; and
206.1 	(3) for each firefighter, the firefighter's name, address, telephone number, and e-mail 
206.2 	address, if any.
206.3 	(c) The notice shall inform the executive director of the following:
206.4 	(1) the transfer effective date, which shall comply with paragraph (d);
206.5 	(2) the name of the relief association and the municipality, independent nonprofit 
206.6 	firefighting corporation, or joint powers entity with which the relief association is associated; 
206.7 	and
206.8 	(3) a summary of the type and level of pension or retirement benefits, including any 
206.9 	ancillary benefits, provided by the relief association or, in the case of a new relief association, 
206.10 	to be provided, and related terms and conditions.
206.11 	(d) If the notice of intent to transfer is filed with the executive director before September 
206.12 	1, the transfer takes effect on the next January 1. If the notice of intent to transfer is filed 
206.13 	after August 31, the transfer takes effect on the January 1 following the one-year anniversary 
206.14 	of the filing of the notice.
206.15 		Subd. 2.Approval by the relief association. (a) Before a transfer of records, assets, 
206.16 	and liabilities from the retirement plan to a relief association may occur, the board of trustees 
206.17 	of the relief association shall adopt resolutions as follows:
206.18 	(1) approving and accepting the transfer of records, assets, and liabilities from the 
206.19 	retirement plan; and
206.20 	(2) amending the bylaws of the relief association as necessary to add the firefighters 
206.21 	whose benefits are being transferred from the retirement plan and to provide that each benefit 
206.22 	being transferred retains vesting, distribution, and other rights to which the firefighter, for 
206.23 	whom the benefit is being transferred, is entitled under the terms of the retirement plan to 
206.24 	the date of the transfer.
206.25 	The board of trustees shall file a copy of the resolutions with the executive director.
206.26 	(b) The board of trustees of the relief association shall file with the state auditor the 
206.27 	following:
206.28 	(1) a copy of the resolutions required under paragraph (a);
206.29 	(2) a copy of the bylaws of the relief association and any bylaw amendments;
206.30 	(3) a copy of the relief association's investment policy;
207.1 	(4) a statement that a board of trustees has been duly elected and each trustee's name, 
207.2 	address, telephone number, and e-mail address, if any;
207.3 	(5) a copy of the most recent annual financial, investment, and plan administration report 
207.4 	filed under section 69.051, unless the due date for the first report has not yet occurred; and
207.5 	(6) a copy of the documentation indicating that a special fund has been established with 
207.6 	a financial institution to receive a transfer of assets from the retirement plan.
207.7 	(c) Upon receipt of the information and documents required under paragraph (b), the 
207.8 	state auditor shall issue to the relief association and the executive director written 
207.9 	confirmation of receipt of all required information and documents.
207.10 		Subd. 3.Approval by the firefighters. (a) A transfer under subdivision 1 shall not occur 
207.11 	unless the active firefighters whose benefits are to be transferred from the retirement plan 
207.12 	to a relief association approve the transfer by a vote of the firefighters conducted by the 
207.13 	executive director.
207.14 	(b) The approval of the firefighters shall be determined by a vote of all active firefighters 
207.15 	whose benefits are to be transferred. An affirmative vote of a majority of the firefighters 
207.16 	voting shall constitute approval.
207.17 	(c) The executive director shall provide a voting ballot and the following to each active 
207.18 	firefighter:
207.19 	(1) a summary of the benefits currently provided to the firefighters under the retirement 
207.20 	plan;
207.21 	(2) a copy of the resolutions of the municipality approving the transfer;
207.22 	(3) a copy of the resolutions of the board of trustees approving the transfer;
207.23 	(4) a copy of the notice of intent to transfer required under subdivision 1;
207.24 	(5) a copy of the state auditor's confirmation required under subdivision 2, paragraph 
207.25 	(c); and
207.26 	(6) the instructions and time frame for voting. Firefighters shall be given no less than 
207.27 	30 days in which to vote.
207.28 	(d) The vote of any firefighter, including whether or not the firefighter voted, shall not 
207.29 	be disclosed to any officer or member of the staff of the municipality or to any officer, 
207.30 	trustee, or member of the staff of the relief association.
208.1 	(e) The executive director shall tally the votes and report the results to the relief 
208.2 	association and the municipality.
208.3 		Subd. 4.Transfer process. (a) Upon completion of the actions required under 
208.4 	subdivisions 1 to 3, the retirement plan shall transfer to the relief association as of the 
208.5 	effective date identified in the notice under subdivision 1, the records, assets, and liabilities 
208.6 	related to the former and current firefighters with benefits under the retirement plan, along 
208.7 	with any assets in excess of liabilities credited to the lump-sum account or the monthly 
208.8 	benefit retirement account attributable to the firefighters and the municipality.
208.9 	(b) The executive director:
208.10 	(1) shall transfer the assets in cash;
208.11 	(2) shall transfer any accounts receivable associated with the lump-sum account or 
208.12 	monthly benefit retirement account;
208.13 	(3) shall settle any accounts payable from the account before the transfer; and
208.14 	(4) may deduct from the assets to be transferred reasonable costs incurred by the 
208.15 	retirement plan to conduct the voting process and complete the transfer.
208.16 		Subd. 5.Relief association obligations and rights upon transfer from the retirement 
208.17 	plan. (a) Upon transfer of the assets of the lump-sum account or monthly benefit retirement 
208.18 	account, the pension liabilities attributable to the benefits for the former and current 
208.19 	firefighters shall become the obligation of the special fund of the relief association.
208.20 	(b) Upon the transfer of the assets of the lump-sum account or monthly benefit retirement 
208.21 	account, the board of trustees of the relief association has legal title to and management 
208.22 	responsibility for the transferred assets as trustees for persons having a beneficial interest 
208.23 	in those assets arising out of the benefit coverage provided by the account.
208.24 	(c) The relief association is the successor in interest with respect to all claims against 
208.25 	the retirement plan relating to the transferred lump-sum account or monthly benefit retirement 
208.26 	account, except for claims alleging any act or acts by the retirement plan or its fiduciaries 
208.27 	that were not done in good faith or that constituted a breach of fiduciary responsibility under 
208.28 	chapter 356A.
208.29 	(d) The value of each volunteer firefighter's benefit in the retirement plan on the day 
208.30 	before the asset transfer shall be no less than the value of the volunteer firefighter's benefit 
208.31 	on the day after the asset transfer. The relief association shall give credit, with respect to 
208.32 	each firefighter whose benefit is being transferred, for all past service, including service 
209.1 	credit with the retirement plan and with any predecessor relief association, to the extent 
209.2 	credit is given for such service in the records of the retirement plan for that firefighter.
209.3 	(e) Upon completion of the transfer of records, assets, and liabilities, the executive 
209.4 	director shall provide written notice to the state auditor, the commissioner of revenue, and 
209.5 	the secretary of state that the transfer is complete.
209.6 		Subd. 6.Failure to obtain approval, certification, or verification. If the municipality, 
209.7 	board of trustees, or firefighters fail to approve the transfer under subdivision 1, 2, or 3 or 
209.8 	the requirements of subdivision 2, paragraph (b), are not met, the transfer of records, assets, 
209.9 	and liabilities from the retirement plan to the relief association shall not occur.

209.10 	EFFECTIVE DATE. This section is effective the day following final enactment.

209.11 	Sec. 9. BROOK PARK; LOWERING SERVICE PENSION LEVEL.
 209.12 	(a) Notwithstanding any law to the contrary, the Public Employees Retirement Association 
209.13 	must lower the annual service pension level for the Brook Park lump-sum account benefits 
209.14 	payable to its volunteer firefighters under Minnesota Statutes, section 353G.11, subdivision 
209.15 	2, from $1,200 to $600, retroactively from January 1, 2016.
209.16 	(b) The city of Brook Park must annually review the service pension level to determine 
209.17 	if the level is appropriate, taking into account the city's need to recruit and retain volunteer 
209.18 	firefighters.

209.19 	EFFECTIVE DATE. Paragraph (a) is effective the day following final enactment. 
209.20 	Paragraph (b) is effective the day after the governing body of the city of Brook Park and 
209.21 	its chief clerical officer timely complete their compliance with Minnesota Statutes, section 
209.22 	645.021, subdivisions 2 and 3.

209.23 	ARTICLE 18
209.24 	GENERALLY APPLICABLE RETIREMENT CHANGES

209.25 	Section 1. Minnesota Statutes 2016, section 356.24, subdivision 1, is amended to read:
209.26 		Subdivision 1.Restriction; exceptions.  It is unlawful for a school district or other 
209.27 	governmental subdivision or state agency to levy taxes for or to contribute public funds to 
209.28 	a supplemental pension or deferred compensation plan that is established, maintained, and 
209.29 	operated in addition to a primary pension program for the benefit of the governmental 
209.30 	subdivision employees other than:
210.1 	(1) to a supplemental pension plan that was established, maintained, and operated before 
210.2 	May 6, 1971;
210.3 	(2) to a plan that provides solely for group health, hospital, disability, or death benefits;
210.4 	(3) to the individual retirement account plan established by chapter 354B;
210.5 	(4) to a plan that provides solely for severance pay under section 465.72 to a retiring or 
210.6 	terminating employee;
210.7 	(5) for employees other than personnel employed by the Board of Trustees of the 
210.8 	Minnesota State Colleges and Universities and covered under the Higher Education 
210.9 	Supplemental Retirement Plan under chapter 354C, but including city managers covered 
210.10 	by an alternative retirement arrangement under section 353.028, subdivision 3, paragraph 
210.11 	(a), or by the defined contribution plan of the Public Employees Retirement Association 
210.12 	under section 353.028, subdivision 3, paragraph (b), if the supplemental plan coverage is 
210.13 	provided for in a personnel policy of the public employer or in the collective bargaining 
210.14 	agreement between the public employer and the exclusive representative of public employees 
210.15 	in an appropriate unit or in the individual employment contract between a city and a city 
210.16 	manager, and if for each available investment all fees and historic rates of return for the 
210.17 	prior one-, three-, five-, and ten-year periods, or since inception, are disclosed in an easily 
210.18 	comprehended document not to exceed two pages, in an amount matching employee 
210.19 	contributions on a dollar for dollar basis, but not to exceed an employer contribution of 
210.20 	one-half of the available elective deferral permitted per year per employee, under the Internal 
210.21 	Revenue Code:
210.22 	(i) to the state of Minnesota deferred compensation plan under section 352.965;
210.23 	(ii) in payment of the applicable portion of the contribution made to any investment 
210.24 	eligible under section 403(b) of the Internal Revenue Code, if the employing unit has 
210.25 	complied with any applicable pension plan provisions of the Internal Revenue Code with 
210.26 	respect to the tax-sheltered annuity program during the preceding calendar year; or
210.27 	(iii) any other deferred compensation plan offered by the employer under section 457 
210.28 	of the Internal Revenue Code;
210.29 	(6) for personnel employed by the Board of Trustees of the Minnesota State Colleges 
210.30 	and Universities and not covered by clause (5), to the supplemental retirement plan under 
210.31 	chapter 354C, if the supplemental plan coverage is provided for in a personnel policy or in 
210.32 	the collective bargaining agreement of the public employer with the exclusive representative 
210.33 	of the covered employees in an appropriate unit, in an amount matching employee 
211.1 	contributions on a dollar for dollar basis, but not to exceed an employer contribution of 
211.2 	$2,700 a year for each employee;
211.3 	(7) to a supplemental plan or to a governmental trust to save for postretirement health 
211.4 	care expenses qualified for tax-preferred treatment under the Internal Revenue Code, if the 
211.5 	supplemental plan coverage is provided for in a personnel policy or in the collective 
211.6 	bargaining agreement of a public employer with the exclusive representative of the covered 
211.7 	employees in an appropriate unit;
211.8 	(8) to the laborers national industrial pension fund or to a laborers local pension fund 
211.9 	for the employees of a governmental subdivision who are covered by a collective bargaining 
211.10 	agreement that provides for coverage by that fund and that sets forth a fund contribution 
211.11 	rate, but not to exceed an employer contribution of $5,000 $7,000 per year per employee;
211.12 	(9) to the plumbers and pipefitters national pension fund or to a plumbers and pipefitters 
211.13 	local pension fund for the employees of a governmental subdivision who are covered by a 
211.14 	collective bargaining agreement that provides for coverage by that fund and that sets forth 
211.15 	a fund contribution rate, but not to exceed an employer contribution of $5,000 per year per 
211.16 	employee;
211.17 	(10) to the international union of operating engineers pension fund for the employees 
211.18 	of a governmental subdivision who are covered by a collective bargaining agreement that 
211.19 	provides for coverage by that fund and that sets forth a fund contribution rate, but not to 
211.20 	exceed an employer contribution of $5,000 per year per employee;
211.21 	(11) to a supplemental plan organized and operated under the federal Internal Revenue 
211.22 	Code, as amended, that is wholly and solely funded by the employee's accumulated sick 
211.23 	leave, accumulated vacation leave, and accumulated severance pay;
211.24 	(12) to the International Association of Machinists national pension fund for the 
211.25 	employees of a governmental subdivision who are covered by a collective bargaining 
211.26 	agreement that provides for coverage by that fund and that sets forth a fund contribution 
211.27 	rate, but not to exceed an employer contribution of $5,000 per year per employee;
211.28 	(13) for employees of United Hospital District, Blue Earth, to the state of Minnesota 
211.29 	deferred compensation program, if the employee makes a contribution, in an amount that 
211.30 	does not exceed the total percentage of covered salary under section 353.27, subdivisions 
211.31 	3 and 3a;
211.32 	(14) to the alternative retirement plans established by the Hennepin County Medical 
211.33 	Center under section 383B.914, subdivision 5; or
212.1 	(15) to the International Brotherhood of Teamsters Central States pension plan for 
212.2 	fixed-route bus drivers employed by the St. Cloud Metropolitan Transit Commission who 
212.3 	are members of the International Brotherhood of Teamsters Local 638 by virtue of that 
212.4 	employment.

212.5 	EFFECTIVE DATE. This section is effective the day following final enactment.

212.6 	Sec. 2. [356.631] ADDITIONAL SOURCES OF FUNDING.
212.7 	Notwithstanding any other provision of law to the contrary, in addition to all sources of 
212.8 	funding described in Minnesota Statutes, section 356.63, any public retirement plan described 
212.9 	in Minnesota Statutes, section 356.63, paragraph (b), is authorized to accept, at its discretion, 
212.10 	for deposit in its fund the following:
212.11 	(1) gifts;
212.12 	(2) donations;
212.13 	(3) bequests; and
212.14 	(4) life insurance death benefits.

212.15 	EFFECTIVE DATE. This section is effective the day following final enactment.

212.16 	Sec. 3.  REPEALER.
 212.17 	Minnesota Statutes 2016, sections 352.04, subdivision 11; and 353.34, subdivision 6,
212.18 	are repealed.

212.19 	EFFECTIVE DATE. This section is effective the day following final enactment.

212.20 	ARTICLE 19
212.21 	SMALL GROUP RETIREMENT CHANGES

212.22 	Section 1. MSRS-GENERAL RETIREMENT ELIGIBILITY CLARIFICATION; 
212.23 	SERVICE CREDIT PURCHASE IN CERTAIN INSTANCES.
 212.24 	(a) Notwithstanding any provision of law to the contrary, an eligible person described 
212.25 	in paragraph (b) is entitled to purchase prior uncredited service credit under paragraph (c) 
212.26 	and, if the service credit purchase is made, to have an effective start date for active retirement 
212.27 	plan membership of June 1, 1989, and to retire under Minnesota Statutes, section 352.116, 
212.28 	subdivision 1.
212.29 	(b) An eligible person is a person who:
213.1 	(1) was born on the dates as follows:

213.2		employee
	birth date
	
213.3		A
	October 2, 1968
	
213.4		B
	June 12, 1965
	
213.5		C
	August 10, 1958
	
213.6		D
	April 29, 1963
	
213.7		E
	April 11, 1955
	
213.8		F
	August 13, 1966
	
213.9		G
	April 22, 1961
	
213.10		H
	December 31, 1958
	
213.11		I
	October 10, 1966
	
213.12		J
	February 4, 1961
	
213.13		K
	August 21, 1963
	
213.14		L
	January 23, 1960
	
213.15		M
	September 19, 1966
	
213.16		N
	November 3, 1961
	
213.17		O
	June 13, 1958
	
213.18		P
	June 23, 1954
	
213.19		Q
	October 20, 1956
	
213.20		R
	July 28, 1955
	
213.21		S
	May 6, 1960
	
213.22		T
	March 19, 1966
	
213.23		U
	August 19, 1966
	
213.24		V
	March 14, 1959
	
213.25 	(2) became an employee of the Minnesota Department of Transportation prior to July 
213.26 	1, 1989, in a position which was not covered by the general state employees retirement plan 
213.27 	of the Minnesota State Retirement System;
213.28 	(3) was eventually employed as a permanent employee after June 30, 1989, and covered 
213.29 	by the general state employees retirement plan of the Minnesota State Retirement System 
213.30 	on the dates as follows:

213.31		employee
	membership record date
	
213.32		A
	September 27, 1989
	
213.33		B
	September 27, 1989
	
213.34		C
	September 26, 1989
	
213.35		D
	September 27, 1989
	
213.36		E
	September 26, 1989
	
214.1		F
	September 13, 1989
	
214.2		G
	September 1, 1989
	
214.3		H
	September 27, 1989
	
214.4		I
	September 27, 1989
	
214.5		J
	September 13, 1989
	
214.6		K
	September 13, 1989
	
214.7		L
	September 26, 1989
	
214.8		M
	August 30, 1989
	
214.9		N
	September 26, 1989
	
214.10		O
	September 13, 1989
	
214.11		P
	September 27, 1989
	
214.12		Q
	September 27, 1989
	
214.13		R
	September 27, 1989
	
214.14		S
	September 13, 1989
	
214.15		T
	September 13, 1989
	
214.16		U
	September 27, 1989
	
214.17		V
	September 26, 1989
	
214.18 	(4) was sent annual statements by the Minnesota State Retirement System between July 
214.19 	1, 2005, and July 1, 2015, indicating eligibility for a retirement benefit under Minnesota 
214.20 	Statutes, section 352.116, subdivision 1; and
214.21 	(5) was sent notification from the Minnesota State Retirement System revising the start 
214.22 	date for general state employees retirement plan membership from a date before July 1, 
214.23 	1989, to a date after June 30, 1989, and indicating consequent inapplicability of Minnesota 
214.24 	Statutes, section 352.116, subdivision 1.
214.25 	(c) An eligible person may purchase allowable service credit in the general state 
214.26 	employees retirement plan of the Minnesota State Retirement System by paying an amount 
214.27 	equal to the employer contributions and employee contributions that would have been paid 
214.28 	from June 1, 1989, to the end of the month prior to the date the employee entered covered 
214.29 	service plus interest at the applicable annual rate or rates specified in Minnesota Statutes, 
214.30 	section 356.59, subdivision 2, compounded annually on the combined employer and 
214.31 	employee contribution amount from the date the contributions would have been paid to the 
214.32 	date the Minnesota State Retirement System receives payment for this service credit purchase. 
214.33 	The payment must be made in a lump sum.
214.34 	(d) An eligible person who purchases allowable service credit under paragraph (c) has 
214.35 	a June 1, 1989, start date for the purpose of allowable service credited by the general state 
215.1 	employees retirement plan of the Minnesota State Retirement System and is eligible for a 
215.2 	retirement annuity under Minnesota Statutes, section 352.116, subdivision 1.
215.3 	(e) The ongoing annuity benefit of an eligible person who is retired and who purchases 
215.4 	allowable service credit under paragraph (c) shall be adjusted consistent with paragraph (d). 
215.5 	The difference between the ongoing annuity benefit and the adjusted ongoing annuity benefit 
215.6 	for all benefit payments made before the adjustment shall be paid as a lump sum.
215.7 	(f) Authority to purchase prior uncredited service credit under this section expires one 
215.8 	year from the effective date of this section.

215.9 	EFFECTIVE DATE. This section is effective the day following final enactment.

215.10 	Sec. 2. PERA-GENERAL; PURCHASE OF SERVICE CREDIT FOR ST. CLOUD 
215.11 	STATE UNIVERSITY EMPLOYEE.
 215.12 	(a) Notwithstanding any provision of law to the contrary, an eligible person described 
215.13 	in paragraph (b) is entitled to purchase from the general employees retirement plan of the 
215.14 	Public Employees Retirement Association allowable service credit under Minnesota Statutes, 
215.15 	section 353.01, subdivision 16, for the period of service described in paragraph (c).
215.16 	(b) An eligible person is a person who:
215.17 	(1) was born on September 1, 1960;
215.18 	(2) was an employee of St. Cloud State University on March 14, 2016;
215.19 	(3) was a member of the general employees retirement plan of the Public Employees 
215.20 	Retirement Association on March 14, 2016;
215.21 	(4) was employed by St. Cloud Technical College on April 1, 1993, and was a member 
215.22 	of the general employees retirement plan of the Public Employees Retirement Association; 
215.23 	and
215.24 	(5) changed employment within St. Cloud State University on February 22, 2006, and 
215.25 	was erroneously placed into the higher education individual retirement account plan from 
215.26 	February 22, 2006, until May 10, 2011, by the Minnesota State Colleges and Universities 
215.27 	system.
215.28 	(c) The period of uncredited service authorized for purchase is the period of February 
215.29 	22, 2006, until May 10, 2011, during which time the eligible person was erroneously placed 
215.30 	into and contributed to the higher education individual retirement account plan.
216.1 	(d) The eligible person's member contributions to the higher education individual 
216.2 	retirement account plan must be transferred to the Public Employees Retirement Association 
216.3 	with any earned investment returns on those contributions. The eligible person must pay 
216.4 	the member contributions that the eligible person would have made to the Public Employees 
216.5 	Retirement Association on the eligible person's compensation from the Minnesota State 
216.6 	Colleges and Universities system for the period of service described in paragraph (c) as if 
216.7 	the person had been covered by the Public Employees Retirement Association during the 
216.8 	period, plus annual compound interest on that amount at the applicable annual rate or rates 
216.9 	specified in Minnesota Statutes, section 356.59, subdivision 3, until the date on which 
216.10 	payment is made to the Public Employees Retirement Association, less the transferred 
216.11 	member contributions and investment earnings.
216.12 	(e) Upon transfer of the equivalent member contribution amount and any additional 
216.13 	payments under paragraph (d), the balance of the eligible person's higher education individual 
216.14 	retirement account plan account must be transferred to the Public Employees Retirement 
216.15 	Association within 60 days following the receipt of the eligible person's payment under 
216.16 	paragraph (d).
216.17 	(f) Upon the transfer of the amounts under paragraphs (d) and (e), the Minnesota State 
216.18 	Colleges and Universities system shall pay the prior service credit purchase payment amount 
216.19 	calculated under Minnesota Statutes, section 356.551, less any amounts received under 
216.20 	paragraphs (d) and (e), within 60 days following the receipt of the eligible person's payment 
216.21 	under paragraph (d).
216.22 	(g) Upon the transfers and payments under paragraph (f), the eligible person must be 
216.23 	credited by the Public Employees Retirement Association with allowable service credit for 
216.24 	Minnesota State Colleges and Universities System employment from February 22, 2006, 
216.25 	until May 10, 2011.
216.26 	(h) Authority to make a service credit purchase under this section expires one year from 
216.27 	the effective date of this section.

216.28 	EFFECTIVE DATE. This section is effective the day following final enactment.

216.29 	Sec. 3. TRA COVERAGE ELECTION AND PERA REFUND REPAYMENT 
216.30 	AUTHORITY FOR CERTAIN MNSCU EMPLOYEE.
 216.31 	(a) Notwithstanding any provision of Minnesota Statutes, chapter 353 or 354B, to the 
216.32 	contrary, an eligible person described in paragraph (b) is eligible to become a coordinated 
216.33 	member of the Teachers Retirement Association and to purchase service and salary credit 
217.1 	in the Teachers Retirement Association coordinated plan retroactively from July 1, 2001, 
217.2 	upon repaying a member contribution refund taken from the general employees retirement 
217.3 	plan of the Public Employees Retirement Association under paragraph (c), upon making 
217.4 	an election under paragraph (e), and upon making all required payments under paragraphs 
217.5 	(f) and (g).
217.6 	(b) An eligible person is a person who:
217.7 	(1) was born April 4, 1956;
217.8 	(2) was employed by a governmental subdivision in 1995, with retirement coverage in 
217.9 	the general employees retirement plan of the Public Employees Retirement Association, 
217.10 	for which a refund of member contributions and interest was taken before 2001;
217.11 	(3) was employed by St. Cloud State University in the late 1990s, with retirement 
217.12 	coverage in the general state employees retirement plan of the Minnesota State Retirement 
217.13 	System;
217.14 	(4) was hired as an academic advisor by St. Cloud State University on July 1, 2001, with 
217.15 	retirement coverage in the higher education individual retirement account plan; and
217.16 	(5) was not informed of the option to elect Teachers Retirement Association coverage 
217.17 	in the coverage election authorized by Minnesota Statutes 2001, section 354B.21, so remained 
217.18 	in the higher education individual retirement account plan.
217.19 	(c) The refund repayment required by Minnesota Statutes, section 356.551, subdivision 
217.20 	1, paragraph (c), must be calculated under Minnesota Statutes, section 353.35, subdivision 
217.21 	1, paragraph (c).
217.22 	(d) Authority to repay a refund under this section expires one year from the effective 
217.23 	date of this section.
217.24 	(e) To be eligible for coverage by the Teachers Retirement Association, an eligible 
217.25 	person must submit a written application to the executive director of the Teachers Retirement 
217.26 	Association on a form provided by the Teachers Retirement Association. The application 
217.27 	must include all documentation of the applicability of this section and any other relevant 
217.28 	information that the executive director may require. Teachers Retirement Association plan 
217.29 	membership commences after the date of the retirement coverage election under this section 
217.30 	and past salary and service credit is granted for past Minnesota State Colleges and 
217.31 	Universities system employment from July 1, 2001, until the executive director receives 
217.32 	the written application specified in this paragraph and receipts of the payments specified in 
218.1 	paragraphs (c), (f), and (g). Coverage by the Teachers Retirement Association is in lieu of 
218.2 	coverage by the individual retirement account plan.
218.3 	(f) If the eligible person makes the retirement coverage election under paragraph (e), 
218.4 	the eligible person's member contributions to the higher education individual retirement 
218.5 	account plan must be transferred to the Teachers Retirement Association with any earned 
218.6 	investment returns on those contributions. If the transferred member contributions and 
218.7 	investment earnings are less than the calculated amount of the member contributions that 
218.8 	the eligible person would have made to the Teachers Retirement Association on the eligible 
218.9 	person's compensation from the Minnesota State Colleges and Universities system for the 
218.10 	period from July 1, 2001, to the date of the retirement coverage election if the person had 
218.11 	been covered by the Teachers Retirement Association during the period, plus annual 
218.12 	compound interest at the applicable rate or rates specified in Minnesota Statutes, section 
218.13 	356.59, subdivision 4, then the eligible person shall pay the balance of that calculated 
218.14 	member contribution obligation within 30 days of the retirement coverage election.
218.15 	(g) Upon the transfer of the equivalent member contribution amount and any additional 
218.16 	payment under paragraph (f), the balance of the eligible person's higher education individual 
218.17 	retirement account plan account must be transferred to the Teachers Retirement Association. 
218.18 	If the amounts under paragraph (f) and the individual retirement account plan balance under 
218.19 	this paragraph are less than the prior service credit purchase payment amount calculated 
218.20 	under Minnesota Statutes, section 356.551, the Minnesota State Colleges and Universities 
218.21 	system shall pay the difference within 60 days of the retirement election date.
218.22 	(h) The authority to make a retirement coverage election under this section expires one 
218.23 	year from the effective date of this section.

218.24 	EFFECTIVE DATE. This section is effective the day following final enactment.

218.25 	Sec. 4. TRA COVERAGE FOR CERTAIN MESABI RANGE COMMUNITY AND 
218.26 	TECHNICAL COLLEGE FACULTY MEMBERS.
 218.27 	(a) Notwithstanding any provision of law to the contrary, an eligible person described 
218.28 	in paragraph (b) is authorized to become a coordinated member of the Teachers Retirement 
218.29 	Association and to purchase service and salary credit in the Teachers Retirement Association 
218.30 	coordinated plan retroactive from July 19, 2000, or September 15, 2000, whichever is 
218.31 	applicable, upon making an election under paragraph (c) and upon making all required 
218.32 	payments under paragraphs (d) and (e).
218.33 	(b) An eligible person is a person who:
219.1 	(1) either:
219.2 	(i) was born on September 25, 1964, and has been employed at Mesabi Range Community 
219.3 	and Technical College and a contributing member of the higher education individual 
219.4 	retirement account plan since July 19, 2000; or
219.5 	(ii) was born on October 15, 1963, and has been employed at Mesabi Range Community 
219.6 	and Technical College and a contributing member of the higher education individual 
219.7 	retirement account plan since September 15, 2000;
219.8 	(2) was classified in the unlimited full-time category on August 21, 2012;
219.9 	(3) became eligible for an election of Teachers Retirement Association coverage under 
219.10 	Laws 2009, chapter 169, article 6, section 1; and
219.11 	(4) was not offered an election of Teachers Retirement Association coverage by the 
219.12 	Minnesota State Colleges and Universities system.
219.13 	(c) To be eligible for coverage by the Teachers Retirement Association, an eligible 
219.14 	person must submit a written application to the executive director of the Teachers Retirement 
219.15 	Association on a form provided by the Teachers Retirement Association. The application 
219.16 	must include all documentation of the applicability of this section and any other relevant 
219.17 	information that the executive director may require. Teachers Retirement Association plan 
219.18 	membership commences after the date of the retirement coverage election under this section 
219.19 	and past salary and service credit is granted for past Minnesota State Colleges and 
219.20 	Universities system employment from July 19, 2000, or September 15, 2000, whichever is 
219.21 	applicable, until the executive director receives the written application specified in this 
219.22 	paragraph and receipts of the payments specified in paragraphs (d) and (e). Coverage by 
219.23 	the Teachers Retirement Association is in lieu of coverage by the individual retirement 
219.24 	account plan.
219.25 	(d) If the eligible person makes the retirement coverage election under paragraph (c), 
219.26 	the eligible person shall make a contribution to the Teachers Retirement Association equal 
219.27 	to the excess, if any, of the employee contributions that the eligible person would have made 
219.28 	if the Teachers Retirement Association had provided coverage from July 19, 2000, or 
219.29 	September 15, 2000, whichever is applicable, rather than the individual retirement account 
219.30 	plan. These additional contribution amounts shall include annual compound interest at the 
219.31 	applicable annual rate or rates specified in Minnesota Statutes, section 356.59, subdivision 
219.32 	4, computed from the date the contribution would have been made if deducted from salary 
219.33 	until paid. The total amount to be paid under this paragraph shall be determined by the 
220.1 	executive director of the Teachers Retirement Association and written notification of the 
220.2 	amount required under this paragraph must be transmitted to the eligible person.
220.3 	(e) If payment is made under paragraph (d), the value of the applicable eligible person's 
220.4 	higher education individual retirement account plan account shall be transferred to the 
220.5 	Teachers Retirement Association.
220.6 	(f) The Teachers Retirement Association shall determine the required purchase payment 
220.7 	amount calculated under Minnesota Statutes, section 356.551, imposed upon the Teachers 
220.8 	Retirement Association under this section due to the salary and service credit purchase.
220.9 	(g) From the total amount computed under paragraph (f), the executive director of the 
220.10 	Teachers Retirement Association shall subtract the amounts received under paragraphs (d) 
220.11 	and (e). The Minnesota State Colleges and Universities system must transmit the remaining 
220.12 	amount, if any, to the executive director of the Teachers Retirement Association within 60 
220.13 	days following the receipt of the payments under paragraphs (d) and (e).
220.14 	(h) The authority to make a retirement coverage election under this section expires one 
220.15 	year from the effective date of this section.

220.16 	EFFECTIVE DATE. This section is effective the day following final enactment.

220.17 	Sec. 5. TEACHERS RETIREMENT ASSOCIATION COVERAGE ELECTION 
220.18 	AND MINNESOTA STATE RETIREMENT SYSTEM REFUND REPAYMENT 
220.19 	AUTHORITY FOR CERTAIN WINONA STATE UNIVERSITY EMPLOYEE.
 220.20 	(a) Notwithstanding any provision of Minnesota Statutes, chapter 352 or 354B, to the 
220.21 	contrary, an eligible person described in paragraph (b) is eligible to become a coordinated 
220.22 	member of the Teachers Retirement Association and to purchase service and salary credit 
220.23 	in the Teachers Retirement Association coordinated plan retroactively from January 1, 1995, 
220.24 	upon repaying a member contribution refund taken from the general employees retirement 
220.25 	plan of the Minnesota State Retirement System under paragraph (c), upon making an election 
220.26 	under paragraph (e), and upon making all required payments under paragraphs (f), (g), and 
220.27 	(h).
220.28 	(b) An eligible person is a person who:
220.29 	(1) was born November 11, 1957;
220.30 	(2) began state employment in 1981, with retirement coverage in the general employees 
220.31 	retirement plan of the Minnesota State Retirement System for which a refund of member 
220.32 	contributions and interest was taken;
221.1 	(3) was employed by Winona State University on September 11, 1989, with retirement 
221.2 	coverage in the higher education individual retirement account plan; and
221.3 	(4) was not informed of the option to elect Teachers Retirement Association coverage 
221.4 	in the coverage election authorized under Laws 1994, chapter 508, article 1, section 10, so 
221.5 	remained in the higher education individual retirement account plan.
221.6 	(c) The refund repayment required by Minnesota Statutes, section 356.551, subdivision 
221.7 	1, paragraph (c), must be calculated under Minnesota Statutes, section 352.23.
221.8 	(d) Authority to repay a refund under this section expires one year from the effective 
221.9 	date of this section.
221.10 	(e) To be eligible for coverage by the Teachers Retirement Association, an eligible 
221.11 	person must submit a written application to the executive director of the Teachers Retirement 
221.12 	Association on a form provided by the Teachers Retirement Association. The application 
221.13 	must include all relevant documentation and information that the executive director may 
221.14 	require. Teachers Retirement Association plan membership commences after the date of 
221.15 	the retirement coverage election under this section and past salary and service credit is 
221.16 	granted for past Minnesota State Colleges and Universities system employment from January 
221.17 	1, 1995, until the executive director receives the written application specified in this 
221.18 	paragraph and receipts of the payments specified in paragraphs (c), (f), (g), and (h). Coverage 
221.19 	by the Teachers Retirement Association is in lieu of coverage by the individual retirement 
221.20 	account plan.
221.21 	(f) If the eligible person makes the retirement coverage election under paragraph (e), 
221.22 	the eligible person's member contributions to the higher education individual retirement 
221.23 	account plan account from January 1, 1995, to the date of the retirement coverage election 
221.24 	must be transferred to the Teachers Retirement Association, with any earned investment 
221.25 	returns on those contributions. If the transferred member contributions and investment 
221.26 	earnings are less than the calculated amount of the member contributions that the eligible 
221.27 	person would have made to the Teachers Retirement Association on the eligible person's 
221.28 	compensation from the Minnesota State Colleges and Universities system for the period 
221.29 	from January 1, 1995, to the date of the retirement coverage election, if the person had been 
221.30 	covered by the Teachers Retirement Association during the period, plus annual compound 
221.31 	interest at the applicable annual rate or rates specified in Minnesota Statutes, section 356.59, 
221.32 	subdivision 4, then the eligible person shall pay the balance of that calculated member 
221.33 	contribution obligation within 30 days of the retirement coverage election.
222.1 	(g) Upon the transfer of the equivalent member contribution amount and any additional 
222.2 	payment under paragraph (f), the employer contributions made on behalf of the eligible 
222.3 	member to the higher education individual retirement account plan account from January 
222.4 	1, 1995, to the date of the retirement coverage election must be transferred to the Teachers 
222.5 	Retirement Association, with any earned investment returns on those contributions.
222.6 	(h) If the amounts under paragraphs (f) and (g) are less than the prior service credit 
222.7 	purchase payment amount under Minnesota Statutes, section 356.551, the Minnesota State 
222.8 	Colleges and Universities system shall pay the difference within 60 days following receipt 
222.9 	of the amounts transmitted under paragraphs (f) and (g).
222.10 	(i) The authority to make a retirement coverage election under this section expires one 
222.11 	year from the effective date of this section.

222.12 	EFFECTIVE DATE. This section is effective the day following final enactment.

222.13 	Sec. 6. PERA COVERAGE ELECTION AND SERVICE CREDIT PURCHASE; 
222.14 	DULUTH TOWNSHIP CLERK.
 222.15 	(a) Notwithstanding any provision of Minnesota Statutes, chapter 353 or 353D, to the 
222.16 	contrary, an eligible person described in paragraph (b) is eligible to purchase from the 
222.17 	general employees retirement plan of the Public Employees Retirement Association allowable 
222.18 	service credit under Minnesota Statutes, section 353.01, subdivision 16, for the period of 
222.19 	service described in paragraph (c).
222.20 	(b) An eligible person is a person who:
222.21 	(1) was born on July 19, 1953;
222.22 	(2) became a member of the public employees defined contribution plan of the Public 
222.23 	Employees Retirement Association on January 7, 1997, as the elected clerk for Duluth 
222.24 	township;
222.25 	(3) should have become a member of the public employees general plan of the Public 
222.26 	Employees Retirement Association on April 12, 2001, when the elected clerk position 
222.27 	became an appointed position;
222.28 	(4) erroneously remained in the public employees defined contribution plan until February 
222.29 	2017; and
222.30 	(5) retroactively joined the public employees general plan to January 1, 2014, pursuant 
222.31 	to Minnesota Statutes, section 353.27, subdivision 12.
223.1 	(c) The period of uncredited service authorized for purchase is the period of April 12, 
223.2 	2001, until December 31, 2013.
223.3 	(d) Any member contributions made to the public employees defined contribution plan, 
223.4 	plus any earned investments returns on those contributions, remaining after the transfer 
223.5 	associated with the cost of omitted salary deductions pursuant to Minnesota Statutes, section 
223.6 	353.27, subdivision 12, may be transferred to the public employees general plan of the 
223.7 	Public Employees Retirement Association upon request from the eligible person. The transfer 
223.8 	must occur within 60 days of the request. Authority to request a transfer under this section 
223.9 	expires December 31, 2018.
223.10 	(e) Any employer contributions made to the public employees defined contribution plan, 
223.11 	plus any earned investment returns on those contributions, remaining after the transfer 
223.12 	associated with the cost of omitted salary deductions pursuant to Minnesota Statutes, section 
223.13 	353.27, subdivision 12, must be transferred to the public employees general plan of the 
223.14 	Public Employees Retirement Association at the same time as the transfer that occurs under 
223.15 	paragraph (d).
223.16 	(f) If the eligible person requests a transfer under paragraph (d), the eligible person must 
223.17 	pay the member contributions that the eligible person would have made to the Public 
223.18 	Employees Retirement Association on the eligible person's compensation from the Duluth 
223.19 	township for the period of service described in paragraph (c) as if the person had been 
223.20 	covered by the public employees general plan, plus annual compound interest on that amount 
223.21 	at the applicable annual rate or rates specified in Minnesota Statutes, section 356.59, 
223.22 	subdivision 3, until the date payment is made to the Public Employees Retirement 
223.23 	Association, less the transferred member contributions and investment earnings.
223.24 	(g) Upon the transfer of the amounts under paragraphs (d), (e), and (f), Duluth township 
223.25 	shall pay the prior service credit purchase payment amount calculated under Minnesota 
223.26 	Statutes, section 356.551, less any amounts received under paragraphs (d), (e), and (f), 
223.27 	within 60 days following the receipt of the eligible person's payment under paragraph (f).
223.28 	(h) Upon the transfer and payment under paragraph (g), the eligible person must be 
223.29 	credited by the Public Employees Retirement Association with allowable service credit for 
223.30 	Duluth township employment from April 12, 2001, until December 31, 2013.
223.31 	(i) Authority to make a service credit purchase under this section expires one year from 
223.32 	the effective date of this section.

223.33 	EFFECTIVE DATE. This section is effective the day following final enactment.

224.1 	ARTICLE 20
224.2 	TECHNICAL CORRECTIONS

224.3 	Section 1. Minnesota Statutes 2016, section 353.01, subdivision 16, is amended to read:
224.4 		Subd. 16.Allowable service; limits and computation. (a) "Allowable service" means:
224.5 	(1) service during years of actual membership in the course of which employee deductions 
224.6 	were withheld from salary and contributions were made at the applicable rates under section 
224.7 	353.27, 353.65, or 353E.03;
224.8 	(2) periods of service covered by payments in lieu of salary deductions under sections 
224.9 	353.27, subdivisions 12 and 12a, and 353.35;
224.10 	(3) service in years during which the public employee was not a member but for which 
224.11 	the member later elected, while a member, to obtain credit by making payments to the fund 
224.12 	as permitted by any law then in effect;
224.13 	(4) a period of authorized leave of absence during which the employee receives pay as 
224.14 	specified in subdivision 10, paragraph (a), clause (4) or (5), from which deductions for 
224.15 	employee contributions are made, deposited, and credited to the fund;
224.16 	(5) a period of authorized leave of absence without pay, or with pay that is not included 
224.17 	in the definition of salary under subdivision 10, paragraph (a), clause (4) or (5), for which 
224.18 	salary deductions are not authorized, and for which a member obtained service credit for 
224.19 	up to 12 months of the authorized leave period by payment under section 353.0161 or
224.20 	353.0162, to the fund made in place of salary deductions;
224.21 	(6) a periodic, repetitive leave that is offered to all employees of a governmental 
224.22 	subdivision. The leave program may not exceed 208 hours per annual normal work cycle 
224.23 	as certified to the association by the employer. A participating member obtains service credit 
224.24 	by making employee contributions in an amount or amounts based on the member's average 
224.25 	salary, excluding overtime pay, that would have been paid if the leave had not been taken. 
224.26 	The employer shall pay the employer and additional employer contributions on behalf of 
224.27 	the participating member. The employee and the employer are responsible to pay interest 
224.28 	on their respective shares at the rate of 8.5 percent until June 30, 2015, and eight percent 
224.29 	thereafter, compounded annually, from the end of the normal cycle until full payment is 
224.30 	made. An employer shall also make the employer and additional employer contributions, 
224.31 	plus 8.5 percent interest until June 30, 2015, and eight percent interest thereafter, compounded 
224.32 	annually, on behalf of an employee who makes employee contributions but terminates public 
224.33 	service. The employee contributions must be made within one year after the end of the 
225.1 	annual normal working cycle or within 30 days after termination of public service, whichever 
225.2 	is sooner. The executive director shall prescribe the manner and forms to be used by a 
225.3 	governmental subdivision in administering a periodic, repetitive leave. Upon payment, the 
225.4 	member must be granted allowable service credit for the purchased period;
225.5 	(7) an authorized temporary or seasonal layoff under subdivision 12, limited to three 
225.6 	months allowable service per authorized temporary or seasonal layoff in one calendar year. 
225.7 	An employee who has received the maximum service credit allowed for an authorized 
225.8 	temporary or seasonal layoff must return to public service and must obtain a minimum of 
225.9 	three months of allowable service subsequent to the layoff in order to receive allowable 
225.10 	service for a subsequent authorized temporary or seasonal layoff;
225.11 	(8) a period during which a member is absent from employment by a governmental 
225.12 	subdivision by reason of service in the uniformed services, as defined in United States Code, 
225.13 	title 38, section 4303(13), if the member returns to public service with the same governmental 
225.14 	subdivision upon discharge from service in the uniformed service within the time frames 
225.15 	required under United States Code, title 38, section 4312(e), provided that the member did 
225.16 	not separate from uniformed service with a dishonorable or bad conduct discharge or under 
225.17 	other than honorable conditions. The service must be credited if the member pays into the 
225.18 	fund equivalent employee contributions based upon the contribution rate or rates in effect 
225.19 	at the time that the uniformed service was performed multiplied by the full and fractional 
225.20 	years being purchased and applied to the annual salary rate. The annual salary rate is the 
225.21 	average annual salary during the purchase period that the member would have received if 
225.22 	the member had continued to be employed in covered employment rather than to provide 
225.23 	uniformed service, or, if the determination of that rate is not reasonably certain, the annual 
225.24 	salary rate is the member's average salary rate during the 12-month period of covered 
225.25 	employment rendered immediately preceding the period of the uniformed service. Payment 
225.26 	of the member equivalent contributions must be made during a period that begins with the 
225.27 	date on which the individual returns to public employment and that is three times the length 
225.28 	of the military leave period, or within five years of the date of discharge from the military 
225.29 	service, whichever is less. If the determined payment period is less than one year, the 
225.30 	contributions required under this clause to receive service credit may be made within one 
225.31 	year of the discharge date. Payment may not be accepted following 30 days after termination 
225.32 	of public service under subdivision 11a. If the member equivalent contributions provided 
225.33 	for in this clause are not paid in full, the member's allowable service credit must be prorated 
225.34 	by multiplying the full and fractional number of years of uniformed service eligible for 
225.35 	purchase by the ratio obtained by dividing the total member contributions received by the 
226.1 	total member contributions otherwise required under this clause. The equivalent employer 
226.2 	contribution, and, if applicable, the equivalent additional employer contribution must be 
226.3 	paid by the governmental subdivision employing the member if the member makes the 
226.4 	equivalent employee contributions. The employer payments must be made from funds 
226.5 	available to the employing unit, using the employer and additional employer contribution 
226.6 	rate or rates in effect at the time that the uniformed service was performed, applied to the 
226.7 	same annual salary rate or rates used to compute the equivalent member contribution. The 
226.8 	governmental subdivision involved may appropriate money for those payments. The amount 
226.9 	of service credit obtainable under this section may not exceed five years unless a longer 
226.10 	purchase period is required under United States Code, title 38, section 4312. The employing 
226.11 	unit shall pay interest on all equivalent member and employer contribution amounts payable 
226.12 	under this clause. Interest must be computed at the rate of 8.5 percent until June 30, 2015, 
226.13 	and eight percent thereafter, compounded annually, from the end of each fiscal year of the 
226.14 	leave or the break in service to the end of the month in which the payment is received. Upon 
226.15 	payment, the employee must be granted allowable service credit for the purchased period; 
226.16 	or
226.17 	(9) a period specified under section 353.0162.
226.18 	(b) No member may receive more than 12 months of allowable service credit in a year 
226.19 	either for vesting purposes or for benefit calculation purposes.
226.20 	(c) For an active member who was an active member of the former Minneapolis 
226.21 	Firefighters Relief Association on December 29, 2011, "allowable service" is the period of 
226.22 	service credited by the Minneapolis Firefighters Relief Association as reflected in the 
226.23 	transferred records of the association up to December 30, 2011, and the period of service 
226.24 	credited under paragraph (a), clause (1), after December 30, 2011. For an active member 
226.25 	who was an active member of the former Minneapolis Police Relief Association on December 
226.26 	29, 2011, "allowable service" is the period of service credited by the Minneapolis Police 
226.27 	Relief Association as reflected in the transferred records of the association up to December 
226.28 	30, 2011, and the period of service credited under paragraph (a), clause (1), after December 
226.29 	30, 2011.

226.30 	EFFECTIVE DATE. This section is effective the day following final enactment.

226.31 	Sec. 2. Minnesota Statutes 2016, section 353.012, is amended to read:
226.32 	353.012 UNIVERSITY OF MINNESOTA EMPLOYEES; FURLOUGH SERVICE 
226.33 	AND SALARY CREDIT.
227.1 	A furloughed employee of the University of Minnesota who is a member of the public 
227.2 	employees police and fire plan may obtain allowable service and salary credit for the furlough 
227.3 	period. The allowable service and salary credit authorization is a leave of absence 
227.4 	authorization for purposes of section 353.0161 and the purchase payment procedure of 
227.5 	section 353.0161, subdivision 2, applies 353.0162.

227.6 	EFFECTIVE DATE. This section is effective the day following final enactment.

227.7 	Sec. 3. Minnesota Statutes 2016, section 353.32, subdivision 4, is amended to read:
227.8 		Subd. 4.Lack, or death, of beneficiary. If a member or former member dies without 
227.9 	having designated a beneficiary or if the beneficiary should die before making application 
227.10 	for refund, and if there is no surviving spouse, and if the legal representative of such member 
227.11 	or former member does not apply for refund within five years from the date of death of the 
227.12 	member or former member, the accumulated deductions to the member or former member's 
227.13 	credit at the time of death shall be disposed of in the manner provided in section 353.34, 
227.14 	subdivision 6 356.631.

227.15 	EFFECTIVE DATE. This section is effective the day following final enactment.

227.16 	Sec. 4. Minnesota Statutes 2016, section 354A.011, subdivision 29, is amended to read:
227.17 		Subd. 29.Vesting; vested. (a) "Vesting" or "vested" means having entitlement to a 
227.18 	nonforfeitable annuity or benefit from athe St. Paul Teachers Retirement Fund Association 
227.19 	coordinated member program administered by a teachers retirement fund association by 
227.20 	having credit for sufficient allowable service under paragraph (b) or (c), whichever applies
227.21 	when the teacher has accrued credit for at least three years of allowable service.
227.22 	(b) For purposes of qualifying for an annuity or a benefit as a coordinated plan member 
227.23 	of the St. Paul Teachers Retirement Fund Association, the teacher is vested when the teacher 
227.24 	has accrued credit for at least three years of service.
227.25 	(c) For purposes of qualifying for an annuity or a benefit as a coordinated plan member 
227.26 	of the Duluth Teachers Retirement Fund Association:
227.27 	(1) a teacher who first became a member of the plan before July 1, 2010, is vested when 
227.28 	the teacher has accrued at least three years of service; and
227.29 	(2) a teacher who first became a member of the plan after June 30, 2010, is vested when 
227.30 	the teacher has accrued at least five years of service.

227.31 	EFFECTIVE DATE. This section is effective the day following final enactment.

228.1 	Sec. 5. Minnesota Statutes 2016, section 354A.095, is amended to read:
228.2 	354A.095 PARENTAL AND MATERNITY LEAVE.
228.3 	Basic or coordinated members of the St. Paul Teachers Retirement Fund Association 
228.4 	and new coordinated members of the Duluth Teachers Retirement Fund Association, who 
228.5 	are granted parental or maternity leave of absence by the employing authority, are entitled 
228.6 	to obtain service credit not to exceed one year for the period of leave upon payment to the 
228.7 	applicable fund by the end of the fiscal year following the fiscal year in which the leave of 
228.8 	absence terminated. The amount of the payment must include the total required employee 
228.9 	and employer contributions for the period of leave prescribed in section 354A.12. Payment 
228.10 	must be based on the member's average monthly salary rate upon return to teaching service, 
228.11 	and is payable without interest. Payment must be accompanied by a certified or otherwise 
228.12 	adequate copy of the resolution or action of the employing authority granting or approving 
228.13 	the leave.

228.14 	EFFECTIVE DATE. This section is effective the day following final enactment.

228.15 	Sec. 6. Minnesota Statutes 2016, section 354A.31, subdivision 3, is amended to read:
228.16 		Subd. 3.Resumption of teaching after commencement of a retirement annuity. (a) 
228.17 	Any person who retired and is receiving a coordinated program retirement annuity under 
228.18 	the provisions of sections 354A.31 to 354A.41 or any person receiving a basic program 
228.19 	retirement annuity under the governing sections in the articles of incorporation or bylaws 
228.20 	and who has resumed teaching service for the school district in which the teachers retirement 
228.21 	fund association exists is entitled to continue to receive retirement annuity payments, except 
228.22 	that all or a portion of the annuity payments must be deferred during the calendar year 
228.23 	immediately following the calendar year in which the person's salary from the teaching 
228.24 	service is in an amount greater than $46,000. The amount of the annuity deferral is one-third 
228.25 	the salary amount in excess of $46,000 and must be deducted from the annuity payable for 
228.26 	the calendar year immediately following the calendar year in which the excess amount was 
228.27 	earned.
228.28 	(b) If the person is retired for only a fractional part of the calendar year during the initial 
228.29 	year of retirement, the maximum reemployment salary exempt from triggering a deferral 
228.30 	as specified in this subdivision must be prorated for that calendar year.
228.31 	(c) After a person has reached the Social Security normal retirement age, no deferral 
228.32 	requirement is applicable regardless of the amount of any compensation received for teaching 
228.33 	service for the school district in which the teachers retirement fund association exists.
229.1 	(d) The amount of the retirement annuity deferral must be handled or disposed of as 
229.2 	provided in section 356.47.
229.3 	(e) Notwithstanding other paragraphs of this subdivision, for any retired Duluth Teachers 
229.4 	Retirement Fund Association member whose effective date of retirement is after June 30, 
229.5 	2013, amounts specified as deferred under this subdivision must instead be forfeited to the 
229.6 	Duluth Teachers Retirement Fund Association fund.
229.7 	(f)(e) Notwithstanding other paragraphs of this subdivision, for any retired St. Paul 
229.8 	Teachers Retirement Fund Association basic or coordinated program member whose effective 
229.9 	date of retirement is after June 30, 2013, amounts specified as deferred under this subdivision 
229.10 	must instead be forfeited to the St. Paul Teachers Retirement Fund Association fund.
229.11 	(g)(f) For the purpose of this subdivision, salary from teaching service includes: (i) all 
229.12 	income for services performed as a consultant or independent contractor; or income resulting 
229.13 	from working with the school district in any capacity; and (ii) the greater of either the income 
229.14 	received or an amount based on the rate paid with respect to an administrative position, 
229.15 	consultant, or independent contractor in the school district in which the teachers retirement 
229.16 	fund association exists and at the same level as the position occupied by the person who 
229.17 	resumes teaching service.
229.18 	(h)(g) On or before February 15 of each year, each applicable employing unit shall 
229.19 	report to the teachers retirement fund association the amount of postretirement salary as 
229.20 	defined in this subdivision, earned as a teacher, consultant, or independent contractor during 
229.21 	the previous calendar year by each retiree of the teachers retirement fund association for 
229.22 	teaching service performed after retirement. The report must be in a format approved by 
229.23 	the executive secretary or director.

229.24 	EFFECTIVE DATE. This section is effective the day following final enactment.

229.25 	Sec. 7. Minnesota Statutes 2016, section 354A.35, subdivision 2, is amended to read:
229.26 		Subd. 2.Death while eligible to retire; surviving spouse optional annuity. (a) The 
229.27 	surviving spouse of a vested coordinated member who dies prior to retirement may elect to 
229.28 	receive, instead of a refund with interest under subdivision 1, an annuity equal to the 100 
229.29 	percent joint and survivor annuity the member could have qualified for had the member 
229.30 	terminated service on the date of death. The surviving spouse eligible for a surviving spouse 
229.31 	benefit under this paragraph may apply for the annuity at any time after the date on which 
229.32 	the deceased employee would have attained the required age for retirement based on the 
229.33 	employee's allowable service. A surviving spouse eligible for surviving spouse benefits 
230.1 	under paragraph (b) or (c) may apply for an annuity at any time after the member's death. 
230.2 	The member's surviving spouse shall be paid a joint and survivor annuity under section 
230.3 	354A.32 and computed under section 354A.31.
230.4 	(b) If the member was under age 55 and has credit for at least 30 years of allowable 
230.5 	service on the date of death, the surviving spouse may elect to receive a 100 percent joint 
230.6 	and survivor annuity based on the age of the member and surviving spouse on the date of 
230.7 	death. The annuity is payable using the full early retirement reduction under section 354A.31, 
230.8 	subdivision 6, paragraph (a), to age 55 and one-half of the early retirement reduction from 
230.9 	age 55 to the age payment begins.
230.10 	(c) If a vested member of the Duluth Teachers Retirement Fund Association was under 
230.11 	age 55 on the date of death but did not yet qualify for retirement, the surviving spouse may 
230.12 	elect to receive the 100 percent joint and survivor annuity based on the age of the member 
230.13 	and the survivor at the time of death. The annuity is payable using the full early retirement 
230.14 	reduction under section 354A.31, subdivision 6 or 7, to age 55 and one-half of the early 
230.15 	retirement reduction from age 55 to the date payment begins.
230.16 	(d)(c) If a vested member of the St. Paul Teachers Retirement Fund Association was 
230.17 	under age 55 on the date of death but did not yet qualify for retirement, the surviving spouse 
230.18 	may elect to receive the 100 percent joint and survivor annuity based on the age of the 
230.19 	member and the survivor at the time of death. The annuity is payable using the full early 
230.20 	retirement reduction under section 354A.31, subdivision 6 or 7, to age 55 and one-half of 
230.21 	the actuarial equivalent reduction from age 55 to the date payment begins. The actuarial 
230.22 	equivalent reduction is calculated so that the reduced annuity is the actuarial equivalent of 
230.23 	the annuity that would be payable to the member if the member deferred receipt of the 
230.24 	annuity and the annuity amount were augmented at an annual rate of 2.5 percent compounded 
230.25 	annually from the day the annuity begins to accrue until the normal retirement age.
230.26 	(e)(d) Sections 354A.37, subdivision 2, and 354A.39 apply to a deferred annuity or 
230.27 	surviving spouse benefit payable under this section. The benefits are payable for the life of 
230.28 	the surviving spouse, or upon expiration of the term certain benefit payment under subdivision 
230.29 	2b.

230.30 	EFFECTIVE DATE. This section is effective the day following final enactment.

230.31 	Sec. 8. Minnesota Statutes 2016, section 356.47, subdivision 1, is amended to read:
230.32 		Subdivision 1.Application. (a) This section applies to the balance of annual retirement 
230.33 	annuities on the amount of retirement annuity reductions after reemployed annuitant earnings 
231.1 	limitations for retirement plans governed by section 352.115, subdivision 10; 353.37; or 
231.2 	354.44, subdivision 5.
231.3 	(b) This section also applies to the balance of annual retirement annuities on the amount 
231.4 	of retirement annuity reductions under section 354A.31, subdivision 3, for members of the 
231.5 	Duluth Teachers Retirement Fund Association whose effective date of retirement is before 
231.6 	July 1, 2013.
231.7 	(c)(b) This section also applies to the balance of annual retirement annuities on the 
231.8 	amount of retirement annuity reductions under section 354A.31, subdivision 3, for members 
231.9 	of the St. Paul Teachers Retirement Fund Association whose effective date of retirement is 
231.10 	before July 1, 2013.

231.11 	EFFECTIVE DATE. This section is effective the day following final enactment.

231.12 	Sec. 9.  REPEALER.
 231.13 	Minnesota Statutes 2016, section 354A.12, subdivision 2c, is repealed.

231.14 	EFFECTIVE DATE. This section is effective the day following final enactment.

231.15 	ARTICLE 21
231.16 	E-12 EDUCATION FINANCE

231.17 	Section 1. Minnesota Statutes 2016, section 126C.10, subdivision 37, is amended to read:
231.18 		Subd. 37.Pension adjustment revenue. (a) A school district's pension adjustment 
231.19 	revenue equals the sum of:
231.20 	(1) the greater of zero or the product of:
231.21 	(1) (i) the difference between the district's adjustment under Minnesota Statutes 2012, 
231.22 	section 127A.50, subdivision 1, for fiscal year 2014 per adjusted pupil unit and the state 
231.23 	average adjustment under Minnesota Statutes 2012, section 127A.50, subdivision 1, for 
231.24 	fiscal year 2014 per adjusted pupil unit; and
231.25 	(2) (ii) the district's adjusted pupil units for the fiscal year.; and
231.26 	(2) the product of the salaries paid to district employees who were members of the 
231.27 	Teachers Retirement Association and the St. Paul Teachers' Retirement Fund Association 
231.28 	for the prior fiscal year and the district's pension adjustment rate for the fiscal year. The 
231.29 	pension adjustment rate for Independent School District No. 625, St. Paul, equals 0.84 
231.30 	percent for fiscal year 2019, 1.67 percent for fiscal year 2020, 1.88 percent for fiscal year 
231.31 	2021, 2.09 percent for fiscal year 2022, 2.3 percent for fiscal year 2023, and 2.5 percent for 
232.1 	fiscal year 2024 and later. The pension adjustment rate for all other districts equals 0.21 
232.2 	percent for fiscal year 2019, 0.42 percent for fiscal year 2020, 0.63 percent for fiscal year 
232.3 	2021, 0.84 percent for fiscal year 2022, 1.05 percent for fiscal year 2023, and 1.25 percent 
232.4 	for fiscal year 2024 and later.
232.5 	(b) For fiscal year 2025 and later, the state total pension adjustment revenue under 
232.6 	paragraph (a), clause (2), must not exceed the amount calculated under paragraph (a), clause 
232.7 	(2), for fiscal year 2024. The commissioner must prorate the pension adjustment revenue 
232.8 	under paragraph (a), clause (2), so as not to exceed the maximum.
232.9 	(c) Notwithstanding section 123A.26, subdivision 1, a cooperative unit, as defined in 
232.10 	section 123A.24, subdivision 2, qualifies for pension adjustment revenue under paragraph 
232.11 	(a), clause (2), as if it was a district, and the aid generated by the cooperative unit shall be 
232.12 	paid to the cooperative unit.

232.13 	EFFECTIVE DATE. This section is effective for revenue in fiscal year 2019 and later.

232.14 	Sec. 2. Minnesota Statutes 2016, section 127A.45, subdivision 12, is amended to read:
232.15 		Subd. 12.Payment percentage for certain aids.  One hundred percent of the aid for 
232.16 	the current fiscal year must be paid for the following aids: reimbursement for enrollment 
232.17 	options transportation, according to sections 124D.03, subdivision 8, and 124D.09, 
232.18 	subdivision 22, and chapter 124E; school lunch aid, according to section 124D.111; and 
232.19 	support services aid, for persons who are deaf, deafblind, and hard-of-hearing according to 
232.20 	section 124D.57; and pension adjustment revenue under section 126C.10, subdivision 37,  
232.21 	paragraphs (a), clause (2); (b); and (c).

232.22 	EFFECTIVE DATE. This section is effective for revenue in fiscal year 2019 and later.

232.23 	ARTICLE 22
232.24 	APPROPRIATIONS

232.25 	Section 1. APPROPRIATIONS; GENERAL FUND PENSION CONTRIBUTION 
232.26 	INCREASES.
 232.27 	(a) $....... in fiscal year 2019 is appropriated from the general fund to the entities specified 
232.28 	in paragraph (b) to offset employer pension contribution increases to executive branch 
232.29 	agencies, boards, commissions, constitutional offices, and the legislature required under 
232.30 	this act. These appropriations are for increases in employer contributions to the Minnesota 
232.31 	State Retirement System general employees, correctional employees, state patrol, and 
233.1 	unclassified retirement plans. The base for fiscal year 2020 is $......., the base for fiscal year 
233.2 	2021 is $......., and the base for fiscal year 2022 and later is $.......
233.3 	(b) The commissioner of management and budget must determine an allocation of the 
233.4 	amount appropriated in paragraph (a) for each executive branch state agency, board, 
233.5 	commission, constitutional office, and the legislature. Each allocation is directly appropriated 
233.6 	to each of these entities as specified by the commissioner. The commissioner of management 
233.7 	and budget must report the amounts appropriated under this section to the chairs and ranking 
233.8 	minority members of the house of representatives Ways and Means Committee and the 
233.9 	senate Finance Committee by August 15, 2018.

233.10 	EFFECTIVE DATE. This section is effective July 1, 2018.

233.11 	Sec. 2. APPROPRIATIONS; NONGENERAL FUND PENSION CONTRIBUTION 
233.12 	INCREASES.
 233.13 	(a) The amounts necessary to pay increased nongeneral fund employer contribution 
233.14 	increases in this act in fiscal year 2019 are appropriated from any nongeneral fund that is 
233.15 	specified by the commissioner of management and budget under paragraph (b). These 
233.16 	appropriations shall offset employer pension contribution increases to executive branch 
233.17 	state agencies, boards, and commissions required under this act. These appropriations are 
233.18 	for increases in employer contributions to the Minnesota State Retirement System general 
233.19 	employees, correctional employees, state patrol, and unclassified retirement plans.
233.20 	(b) The commissioner of management and budget must determine the appropriate fund 
233.21 	and amount required under paragraph (a) for each executive branch state agency, board, 
233.22 	and commission, for each fiscal year. The commissioner of management and budget must 
233.23 	report the amounts appropriated under this section to the chairs and ranking minority 
233.24 	members of the house of representatives Ways and Means Committee and the senate Finance 
233.25 	Committee by August 15, 2018.

233.26 	EFFECTIVE DATE. This section is effective July 1, 2018.

233.27 	Sec. 3. APPROPRIATIONS; JUDICIAL BRANCH.
 233.28 	(a) $....... in fiscal year 2019 is appropriated from the general fund to the Supreme Court 
233.29 	for increased employer pension contributions to the Minnesota State Retirement System 
233.30 	general employees and unclassified retirement plans. The base for fiscal year 2020 and later 
233.31 	is $.......
234.1 	(b) $....... in fiscal year 2019 is appropriated from the general fund to the Court of Appeals 
234.2 	for increased employer pension contributions to the Minnesota State Retirement System 
234.3 	general employees and unclassified retirement plans. The base for fiscal year 2020 and later 
234.4 	is $.......
234.5 	(c) $....... in fiscal year 2019 is appropriated from the general fund to the district courts 
234.6 	for increased employer pension contributions to the Minnesota State Retirement System 
234.7 	general employees and unclassified retirement plans. The base for fiscal year 2020 and later 
234.8 	is $.......
234.9 	(d) $....... in fiscal year 2019 is appropriated from the general fund to the Board of Public 
234.10 	Defense for increased employer pension contributions to the Minnesota State Retirement 
234.11 	System general employees and unclassified retirement plans. The base for fiscal year 2020 
234.12 	and later is $.......
234.13 	(e) $....... in fiscal year 2019 is appropriated from the general fund to the Guardian ad 
234.14 	Litem Board for increased employer pension contributions to the Minnesota State Retirement 
234.15 	System general employees and unclassified retirement plans. The base for fiscal year 2020 
234.16 	and later is $.......
234.17 	(f) $....... in fiscal year 2019 is appropriated from the general fund to the Board of Judicial 
234.18 	Standards for increased employer pension contributions to the Minnesota State Retirement 
234.19 	System general employees and unclassified retirement plans. The base for fiscal year 2020 
234.20 	and later is $.......

234.21 	EFFECTIVE DATE. This section is effective July 1, 2018.

234.22 	Sec. 4. APPROPRIATIONS; TEACHERS RETIREMENT ASSOCIATION.
 234.23 	(a) $....... in fiscal year 2019 is appropriated from the general fund to the Department of 
234.24 	Education for increased employer pension contributions to the Teachers Retirement 
234.25 	Association. The base for fiscal year 2020 is $......., the base for fiscal year 2021 is $......., 
234.26 	the base for fiscal year 2022 is $......., the base for fiscal year 2023 is $......., and the base 
234.27 	for fiscal year 2024 and later is $.......
234.28 	(b) $....... in fiscal year 2019 is appropriated from the general fund to the Minnesota 
234.29 	State Academies for increased employer pension contributions to the Teachers Retirement 
234.30 	Association. The base for fiscal year 2020 is $......., the base for fiscal year 2021 is $......., 
234.31 	the base for fiscal year 2022 is $......., the base for fiscal year 2023 is $......., and the base 
234.32 	for fiscal year 2024 and later is $.......
235.1 	(c) $....... in fiscal year 2019 is appropriated from the general fund to the Perpich Center 
235.2 	for the Arts for increased employer pension contributions to the Teachers Retirement 
235.3 	Association. The base for fiscal year 2020 is $......., the base for fiscal year 2021 is $......., 
235.4 	the base for fiscal year 2022 is $......., the base for fiscal year 2023 is $......., and the base 
235.5 	for fiscal year 2024 and later is $.......

235.6 	EFFECTIVE DATE. This section is effective July 1, 2018.

235.7 	Sec. 5. EDUCATION APPROPRIATIONS.
 235.8 		Subdivision 1.Department of Education. The sums indicated are appropriated from 
235.9 	the general fund to the Department of Education for the fiscal years designated. These sums 
235.10 	are in addition to appropriations made for the same purpose in any other law.
235.11 		Subd. 2.General education aid. For general education aid under Minnesota Statutes, 
235.12 	section 126C.13, subdivision 4:

235.13		$
	.......
	.....
	2019
	
235.14 	The 2019 appropriation includes $0 for 2018 and $....... for 2019.

235.15 	EFFECTIVE DATE. This section is effective July 1, 2018.

APPENDIX 

Repealed Minnesota Statutes: HF3053-0 

3A.12 COVERAGE BY MORE THAN ONE RETIREMENT SYSTEM OR ASSOCIATION.Subdivision 1.Entitlement to annuity. 
(a) Any legislator who has been a member of a retirement plan listed in paragraph (b) is entitled, when otherwise qualified, to a retirement allowance or annuity from each plan if the total allowable service in all plans or in any two of these plans totals ten or more years. 

(b) This section applies to any retirement plan or program administered by the Minnesota State Retirement System, or any retirement plan administered by the Public Employees Retirement Association, including the Public Employees Retirement Association police and fire fund, or the Teachers Retirement Association, or the Minneapolis employees retirement plan, or the State Patrol retirement plan, or any other public employee retirement system in the state of Minnesota having a like provision. 

(c) This section does not apply to other retirement plans providing benefits for police or firefighters. 

(d) No portion of the allowable service upon which the retirement annuity from one plan is based is again used in the computation for benefits from another plan. The annuity from each plan must be determined by the appropriate provisions of the law, except that the requirement that a person must have a minimum number of years of allowable service in the respective system or association does not apply for the purposes of this section if the combined service in two or more of these plans equals ten or more years. The augmentation of deferred annuities provided in section 3A.02, subdivision 4, applies to the annuities accruing under this section. 

Subd. 2.Refund repayment. 
A former legislator who has received a refund as provided in section 3A.03, subdivision 2, who is a currently contributing member of a retirement plan specified in subdivision 1, paragraph (b), may repay the refund as provided in section 3A.03, subdivision 2. A member of the legislature who has received a refund from any of the retirement plans specified in subdivision 1 may repay the refund to the respective plan under such terms and conditions consistent with the law governing the retirement plan if the law governing the plan permits the repayment of refunds. If the total amount to be repaid, including principal and interest exceeds $2,000, repayment maybe made in three equal installments over a period of 18 months, with the interest accrued during the period of the repayment added to the final installment. 

352.04 STATE EMPLOYEES RETIREMENT FUND, CONTRIBUTIONS BY EMPLOYEE AND EMPLOYER.Subd. 11.Gifts and bequests. 
The director may credit to the retirement fund any money received in the form of donations, gifts, appropriations, bequests, or otherwise, or derived from it. 

352.045 PROCEDURE FOR REVISING EMPLOYEE AND EMPLOYER CONTRIBUTIONS IN CERTAIN INSTANCES.Subdivision 1.Application. 
This section applies to the general state employees retirement plan established under this chapter, the correctional state employees retirement plan established under this chapter, and the state patrol retirement plan established under chapter 352B. 

Subd. 2.Determination. 
For purposes of this section, a contribution sufficiency exists if, for the applicable plan, the total of the employee contributions, the employer contributions, and any additional employer contributions, if applicable, exceeds the total of the normal cost, the administrative expenses, and the amortization contribution of the retirement plan as reported in the most recent actuarial valuation of the retirement plan prepared by the approved actuary retained under section 356.214 and prepared under section 356.215 and the standards for actuarial work of the Legislative Commission on Pensions and Retirement. For purposes of this section, a contribution deficiency exists if, for the applicable plan, the total employee contributions, employer contributions, and any additional employer contributions are less than the total of the normal cost, the administrative expenses, and the amortization contribution of the retirement plan as reported in the most recent actuarial valuation of the retirement plan prepared by the approved actuary retained under section 356.214 and prepared under section 356.215 and the standards for actuarial work of the Legislative Commission on Pensions and Retirement. 

Subd. 3a.Contribution rate revision; general state employees retirement plan. 
(a) Notwithstanding the contribution rates as specified in law governing the applicable retirement plan, the board of directors of the Minnesota State Retirement System may adjust the employee and employer contribution rates for the general state employees retirement plan if the regular actuarial valuation of the plan prepared under section 356.215 indicates that there is a contribution sufficiency greater than one percent of covered payroll or that there is a contribution deficiency under subdivision 2 equal to or greater than one-half of one percent of covered payroll. 

(b) If the actuarially determined contribution of the plan is less than the total support provided by the combined employee and employer contribution rates by more than one percent of covered payroll, the plan employee and employer contribution rates may be decreased incrementally over one or more years to a level such that there remains a contribution sufficiency of at least one percent of covered payroll. Any decrease in employee and employer contribution rates must not result in total contributions that are less than the sum of the normal cost and administrative expenses of the retirement plan. 

(c) If the actuarially required contribution exceeds the total support provided by the employee and employer contribution rates, the board of directors may increase the employee and employer contribution rates equally to eliminate that contribution deficiency. 

(d) To determine if an adjustment is to be made, the board of directors shall consult with the approved actuary retained under section 356.214 and shall take into consideration factors that include, but are not limited to, the contribution rates calculated based on the actuarial value of assets and calculated based on the market value of assets; the funded ratio calculated based on the actuarial value of assets; the funded ratio calculated based on the market value of assets; the remaining number of years to the amortization target date; the recent experience of the investment markets; and the results of the 30-year funding, disbursements, and contribution projections prepared every other year as required under the standards for actuarial work adopted by the Legislative Commission on Pensions and Retirement. 

(e) Any adjustment to the contribution rates must be reported to the chair and the executive director of the Legislative Commission on Pensions and Retirement by January 15 following receipt of the most recent annual actuarial valuation prepared under section 356.215. The report must include draft legislation to revise the employee and employer contributions stated in plan law. If the Legislative Commission on Pensions and Retirement does not recommend against the rate change or does not recommend a modification in the rate change, the adjustment becomes effective on the first day of the first full payroll period in the fiscal year following receipt of the most recent actuarial valuation that gave rise to the adjustment. 

(f) A contribution sufficiency of up to one percent of covered payroll must be held in reserve to be used to offset any future actuarially determined contributions that are more than the total combined employee and employer contributions. 

(g) Before any reduction in contributions to eliminate a sufficiency in excess of one percent of covered pay may be made, the executive director must review any need for a change in actuarial assumptions, as recommended by the approved actuary retained under section 356.214 in the most recent experience study of the general employees retirement plan prepared under section 356.215 and the standards for actuarial work promulgated by the Legislative Commission on Pensions and Retirement that may result in an increase in the actuarially determined contribution and must report to the Legislative Commission on Pensions and Retirement any decision by the board to use the sufficiency exceeding one percent of covered payroll to offset the impact of an actuarial assumption change recommended by the actuary retained under section 356.214, subdivision 1, and reviewed by the actuary retained by the commission under section 356.214, subdivision 4. 

(h) No contribution sufficiency in excess of one percent of covered pay may be proposed to be used to increase benefits, and no benefit increase may be proposed that would initiate an adjustment to increase contributions under this subdivision. Any proposed benefit improvement must include a recommendation, prepared by the approved actuary retained under section 356.214, subdivision 1, and reviewed by the actuary retained by the Legislative Commission on Pensions and Retirement as provided under section 356.214, subdivision 4, on how the benefit modification will be funded. 

Subd. 3b.Contribution rate revision; correctional state employees retirement plan and State Patrol retirement plan. 
(a) Subdivision 3a applies to the correctional state employees retirement plan under this chapter and to the State Patrol retirement plan established under chapter 352B, except as specified in paragraph (b) or (c). 

(b) Any limitations on the amount of contribution rate changes stated in subdivision 3a apply only to the amount of the employee contribution revision. The employer contribution for the correctional state employees retirement plan or the State Patrol retirement plan, whichever is applicable, must be adjusted so that the employer contribution is equal to 60 percent of the sum of employee plus employer contributions. 

(c) For the State Patrol retirement plan, a contribution sufficiency of up to two percent of covered payroll, rather than one percent, may be held in reserves without taking action to reduce employee and employer contributions. 

352.72 COVERAGE BY MORE THAN ONE RETIREMENT SYSTEM.Subdivision 1.Entitlement to annuity. 
(a) Any person who has been an employee covered by a retirement system listed in paragraph (b) is entitled when qualified to an annuity from each fund if total allowable service in all funds or in any two of these funds totals three or more years if employed before July 1, 2010, or totals five or more years if employed after June 30, 2010. 

(b) This section applies to the Minnesota State Retirement System, the Public Employees Retirement Association including the Public Employees Retirement Association police and fire fund, the Teachers Retirement Association, the State Patrol Retirement Association, or any other public employee retirement system in the state with a similar provision, except as noted in paragraph (c). 

(c) This section does not apply to other funds providing benefits for police officers or firefighters. 

(d) No portion of the allowable service upon which the retirement annuity from one fund is based shall be again used in the computation for benefits from another fund. No refund may have been taken from any one of these funds since service entitling the employee to coverage under the system or the employee's membership in any of the associations last terminated. The annuity from each fund must be determined by the appropriate provisions of the law except that the requirement that a person must have at least a specific number of years of allowable service in the respective system or association does not apply for the purposes of this section if the combined service in two or more of these funds equals at least the longest period of allowable service of any of the applicable retirement plans. 

Subd. 2.Computation of deferred annuity. 
(a) The deferred annuity, if any, accruing under subdivision 1, or section 352.22, subdivision 3, must be computed as provided in section 352.22, subdivision 3, on the basis of allowable service before termination of state service and augmented as provided herein. The required reserves applicable to a deferred annuity or to an annuity for which a former employee was eligible but had not applied or to any deferred segment of an annuity must be determined as of the date the benefit begins to accrue and augmented by interest compounded annually from the first day of the month following the month in which the employee ceased to be a state employee, or July 1, 1971, whichever is later, to the first day of the month in which the annuity begins to accrue. The rates of interest used for this purpose must be five percent compounded annually until January 1, 1981, and three percent compounded annually thereafter until January 1 of the year following the year in which the former employee attains age 55 or until January 1, 2012, whichever is earlier, and from the January 1 next following the attainment of age 55 to the effective date of retirement or until January 1, 2012, whichever is earlier, five percent compounded annually if the employee became an employee before July 1, 2006, 2.5 percent compounded annually until January 1, 2012, if the employee becomes an employee after June 30, 2006, and two percent compounded annually after December 31, 2011, irrespective of when the employee became a state employee. If a person has more than one period of uninterrupted service, the required reserves related to each period must be augmented by interest under this subdivision. The sum of the augmented required reserves so determined is the present value of the annuity. "Uninterrupted service" for the purpose of this subdivision means periods of covered employment during which the employee has not been separated from state service for more than two years. If a person repays a refund, the service restored by the repayment must be considered continuous with the next period of service for which the employee has credit with this system. The formula percentages used for each period of uninterrupted service must be those applicable to a new employee. The mortality table and interest assumption used to compute the annuity must be those in effect when the employee files application for annuity. This section does not reduce the annuity otherwise payable under this chapter. 

(b) The retirement annuity or disability benefit of, or the survivor benefit payable on behalf of, a former state employee who terminated service before July 1, 1997, which is not first payable until after June 30, 1997, must be increased on an actuarial equivalent basis to reflect the change in the postretirement interest rate actuarial assumption under section 356.215, subdivision 8, from five percent to six percent under a calculation procedure and the tables adopted by the board and approved by the actuary retained under section 356.214. 

Subd. 4.Refund repayment. 
Any person who has received a refund from the state employees retirement fund, and who is a member of a public retirement system included in subdivision 1, may repay the refund with interest to the state employees retirement fund. If a refund is repaid to the fund and more than one refund has been received from the fund, all refunds must be repaid. Repayment must be made as provided in section 352.23, and under terms and conditions consistent with that section as agreed upon with the director. 

Subd. 5.Early retirement. 
The requirements and provisions for retirement before normal retirement age in sections 352.115, subdivision 1, and 352.116 also apply to an employee fulfilling the requirements with a combination of service as provided in subdivision 1. 

352B.30 COVERAGE BY MORE THAN ONE RETIREMENT SYSTEM OR ASSOCIATION.Subdivision 1.Entitlement to annuity. 
Any person who has been an employee covered by the Minnesota State Retirement System, or a member of the Public Employees Retirement Association including the Public Employees Retirement Association Police and Fire Fund, or the Teachers Retirement Association, or the State Patrol retirement fund, or any other public employee retirement system in Minnesota having a like provision but excluding all other funds providing benefits for police or firefighters is entitled when qualified to an annuity from each fund if total allowable service in all funds or in any two of these funds totals the number of years of allowable service required by the applicable retirement plan with the longest vesting period for the person. No part of the allowable service upon which the retirement annuity from one fund is based may again be used in the computation for benefits from another fund. The member must not have taken a refund from any one of these funds since service entitling the member to coverage under the system or membership in any of the associations last terminated. The annuity from each fund must be determined by the appropriate law except that the requirement that a person must have at least a specific number of years allowable service in the respective system or association does not apply for the purposes of this section if the combined service in two or more of these funds equals the number of years of allowable service required by the applicable retirement plan with the longest vesting period for the person. 

Subd. 2.Computation of deferred annuity. 
Deferred annuities must be computed according to this chapter on the basis of allowable service before termination of service and augmented as provided in this chapter. The required reserves applicable to a deferred annuity must be augmented by interest compounded annually from the first day of the month following the month in which the member terminated service, or July 1, 1971, whichever is later, to the first day of the month in which the annuity begins to accrue. The rates of interest used for this purpose must be five percent per year compounded annually until January 1, 1981, three percent per year compounded annually after January 1, 1981, until January 1, 2012, if the employee became an employee before July 1, 2006, 2.5 percent compounded annually if the employee becomes an employee after June 30, 2006, and two percent per year compounded annually after December 31, 2011, irrespective of when the employee was first employed. The mortality table and interest assumption used to compute the annuity must be those in effect when the member files application for annuity. 

Subd. 3.Refund repayment. 
A person who has received a refund from the State Patrol retirement fund who is a member of a public retirement system included in subdivision 1, may repay the refund with interest to the State Patrol retirement fund as provided in section 352B.11, subdivision 4. 

Subd. 4.1997 postretirement fund interest changes. 
The retirement annuity or disability benefit of, or the survivor benefit payable on behalf of, a former member who terminated service before July 1, 1997, which is not first payable until after June 30, 1997, must be increased on an actuarial equivalent basis to reflect the change in the postretirement interest rate actuarial assumption under section 356.215, subdivision 8, from five percent to six percent under a calculation procedure and tables adopted by the board and approved by the actuary retained under section 356.214. 

353.0161 AUTHORIZED LEAVE OF ABSENCE SERVICE CREDIT PURCHASE PROCEDURE.Subdivision 1.Application. 
This section applies to employees covered by any plan specified in this chapter or chapter 353E for any period of authorized leave of absence specified in section 353.01, subdivision 16, paragraph (a), clause (5), for which the employee obtains credit for allowable service by making payment as specified in this section to the applicable fund. 

Subd. 2.Purchase procedure. 
(a) An employee covered by a plan specified in subdivision 1 may purchase credit for allowable service in that plan for a period specified in subdivision 1 if the employee makes a payment as specified in paragraph (b) or (c), whichever applies. The employing unit, at its option, may pay the employer portion of the amount specified in paragraph (b) on behalf of its employees. 

(b) If payment is received by the executive director within one year from the date the member returned to work following the authorized leave, or within 30 days after the date of termination of public service if the member did not return to work, the payment amount is equal to the employee and employer contribution rates specified in law for the applicable plan at the end of the leave period, or at termination of public service, whichever is earlier, multiplied by the employee's average monthly salary, excluding overtime, upon which deductions were paid during the six months, or portion thereof, before the commencement of the leave of absence and by the number of months of the leave of absence for which the employee wants allowable service credit. Payments made under this paragraph must include compound interest at the monthly rate of 0.71 percent until June 30, 2015, and 0.667 percent per month thereafter from the last day of the leave period until the last day of the month in which payment is received. 

(c) If payment is received by the executive director after one year, the payment amount is the amount determined under section 356.551. Payment under this paragraph must be made before the date the person terminates public service under section 353.01, subdivision 11a. 

Subd. 3.Restriction on subsequent purchases. 
To purchase salary credit or service credit for a subsequent authorized leave of absence period, the member must return to public service and render a minimum of three months of allowable service credit. 

353.27 GENERAL EMPLOYEES RETIREMENT FUND.Subd. 3b.Change in employee and employer contributions in certain instances. 
(a) For purposes of this section: 

(1) a contribution sufficiency exists if the total of the employee contribution under subdivision 2, the employer contribution under subdivision 3, the additional employer contribution under subdivision 3a, and any additional contribution previously imposed under this subdivision exceeds the total of the normal cost, the administrative expenses, and the amortization contribution of the general employees retirement plan as reported in the most recent actuarial valuation of the retirement plan prepared by the actuary retained under section 356.214 and prepared under section 356.215 and the standards for actuarial work of the Legislative Commission on Pensions and Retirement; and 

(2) a contribution deficiency exists if the total of the employee contributions under subdivision 2, the employer contributions under subdivision 3, the additional employer contribution under subdivision 3a, and any additional contribution previously imposed under this subdivision is less than the total of the normal cost, the administrative expenses, and the amortization contribution of the general employees retirement plan as reported in the most recent actuarial valuation of the retirement plan prepared by the actuary retained under section 356.214 and prepared under section 356.215 and the standards for actuarial work of the Legislative Commission on Pensions and Retirement. 

(b) Notwithstanding the contribution rate provision specified under subdivisions 2, 3, and 3a, the board of trustees of the Public Employees Retirement Association may adjust the employee and employer contributions to the general employees retirement plan under subdivisions 2 and 3 if the regular actuarial valuation of the general employees retirement plan of the Public Employees Retirement Association prepared under section 356.215 indicates that there is a contribution sufficiency under paragraph (a) greater than one percent of covered payroll or that there is a contribution deficiency under paragraph (a) equal to or greater than one-half of one percent of covered payroll. 

(c) If the actuarially determined contribution of the general employees retirement plan is less than the total support provided by the combined employee and employer contribution rates under subdivisions 2, 3, and 3a, by more than one percent of covered payroll, the general employees retirement plan coordinated program employee and employer contribution rates under subdivisions 2 and 3 may be decreased over one or more years to a level such that there remains a contribution sufficiency of at least one percent of covered payroll. Any decrease in employee and employer contribution rates must not result in total contributions that are less than the total of the normal cost of the retirement plan and the administrative expenses of the retirement plan. 

(d) If the actuarially determined contribution exceeds the total support provided by the combined employee and employer contribution rates under subdivisions 2, 3, and 3a, the board of trustees may increase the employee and matching employer contribution rates to eliminate that contribution deficiency. 

(e) To determine if an adjustment is to be made, the board of trustees shall consult with the approved actuary retained under section 356.214 and shall take into consideration factors that include, but are not limited to, the contribution rates based on actuarial value of assets and contribution rates based on the market value of assets; the funded ratio based on the actuarial value of assets and based on the market value of assets; the number of years remaining to the amortization target date; the recent experience of the investment markets; and the results of the 30-year funding, disbursements, and contributions projections prepared every other year as required under the standards for actuarial work adopted by the Legislative Commission on Pensions and Retirement. 

(f) Any adjustment to the contribution rates must be reported to the chair and the executive director of the Legislative Commission on Pensions and Retirement by January 15 following the receipt of the most recent annual actuarial valuation prepared under section 356.215. If the Legislative Commission on Pensions and Retirement does not recommend against the rate change or does not recommend a modification in the rate change, the recommended adjustment becomes effective for any salary paid on or after the January 1 next following the legislative session in which the Legislative Commission on Pensions and Retirement did not take any action to disapprove or modify the Public Employees Retirement Association Board of Trustees' adjustment to the employee and employer rates. 

(g) A contribution sufficiency of up to one percent of covered payroll must be held in reserve to be used to offset any future actuarially determined contributions that are more than the total combined employee and employer contributions under subdivisions 2, 3, and 3a. 

(h) Before any reduction in contributions to eliminate a sufficiency in excess of one percent of covered pay may be made, the executive director must review any need for a change in actuarial assumptions, as recommended by the actuary retained under section 356.214 in the most recent experience study of the general employees retirement plan prepared under section 356.215 and the standards for actuarial work promulgated by the Legislative Commission on Pensions and Retirement that may result in an increase in the actuarially determined contribution and must report to the Legislative Commission on Pensions and Retirement any decision by the board to use the sufficiency exceeding one percent of covered payroll to offset the impact of an actuarial assumption change recommended by the actuary retained under section 356.214, subdivision 1, and reviewed by the actuary retained by the commission under section 356.214, subdivision 4. 

(i) No contribution sufficiency in excess of one percent of covered pay may be proposed to be used to increase benefits, and no benefit increase may be proposed that would initiate an adjustment to increase contributions under this subdivision. Any proposed benefit improvement must include a recommendation, prepared by the approved actuary retained under section 356.214, subdivision 1, and reviewed by the actuary retained by the Legislative Commission on Pensions and Retirement as provided under section 356.214, subdivision 4, on how the benefit modification will be funded. 

353.34 RIGHTS UPON TERMINATION OF MEMBERSHIP.Subd. 6.Additions to fund. 
The board of trustees may credit to the general employees retirement fund any money received in the form of contributions, donations, gifts, appropriations, bequests, or otherwise. 

353.71 COVERAGE BY MORE THAN ONE RETIREMENT SYSTEM; DEFERRED ANNUITY; AUGMENTATION.Subdivision 1.Eligibility. 
Any person who has been a member of a defined benefit retirement plan administered by the Public Employees Retirement Association, or a retirement plan administered by the Minnesota State Retirement System, or the Teachers Retirement Association, or any other public retirement system in the state of Minnesota having a like provision, except a retirement plan providing benefits for police officers or firefighters governed by sections 424A.091 to 424A.096, or by Laws 2013, chapter 111, article 5, sections 31 to 42, is entitled, when qualified, to an annuity from each retirement plan if the total allowable service in all retirement plans or in any two of these retirement plans totals the number of years of allowable service required to receive a normal retirement annuity for that retirement plan, provided that no portion of the allowable service upon which the retirement annuity from one retirement plan is based is again used in the computation for benefits from another retirement plan and provided further that the person has not taken a refund from any one of these retirement plans since the person's membership in that association or system last terminated. The annuity from each fund must be determined by the appropriate provisions of the law except that the requirement that a person must have at least a specific minimum period of allowable service in the respective association or system does not apply for the purposes of this section if the combined service in two or more of these retirement plans equals the number of years of allowable service required to receive a normal retirement annuity for that retirement plan. 

Subd. 2.Deferred annuity computation; augmentation. 
(a) The deferred annuity accruing under subdivision 1, or under sections 353.34, subdivision 3, and 353.68, subdivision 4, must be computed on the basis of allowable service prior to the termination of public service and augmented as provided in this subdivision. The required reserves applicable to a deferred annuity, or to any deferred segment of an annuity must be determined as of the first day of the month following the month in which the former member ceased to be a public employee, or July 1, 1971, whichever is later. 

(b) For a person who became a public employee before July 1, 2006, whose period of deferral began after June 30, 1971, and who terminated public employment before January 1, 2012, the required reserves of the deferred annuity must be augmented at the following applicable rate or rates: 

(1) five percent annual compound interest until January 1, 1981; 

(2) three percent annual compound interest after January 1, 1981, or until the earlier of December 31, 2011, or after the date of the termination of public service or the termination of membership, whichever is later, until January 1 of the year following the year in which the former member attains age 55; 

(3) five percent annual compound interest from January 1 of the year following the year in which the former member attains age 55, or until December 31, 2011, whichever is earlier; and 

(4) one percent annual compound interest from January 1, 2012. 

(c) For a person who became a public employee after June 30, 2006, and who terminated public employment before January 1, 2012, the required reserves of the deferred annuity must be augmented at 2.5 percent annual compound interest from the date of termination of public service or termination of membership, whichever is earlier, until December 31, 2011, and one percent annual compound interest after December 31, 2011. 

(d) For a person who terminates public employment after December 31, 2011, the required reserves of the deferred annuity must not be augmented. 

(e) If a person has more than one period of uninterrupted service, the required reserves related to each period must be augmented as specified in this paragraph. The sum of the augmented required reserves is the present value of the annuity. Uninterrupted service for the purpose of this subdivision means periods of covered employment during which the employee has not been separated from public service for more than two years. If a person repays a refund, the restored service must be considered as continuous with the next period of service for which the employee has credit with this association. This section must not reduce the annuity otherwise payable under this chapter. This paragraph applies to individuals who become deferred annuitants on or after July 1, 1971. For a member who became a deferred annuitant before July 1, 1971, the paragraph applies from July 1, 1971, if the former active member applies for an annuity after July 1, 1973. 

(f) The retirement annuity or disability benefit of, or the survivor benefit payable on behalf of, a former member who terminated service before July 1, 1997, or the survivor benefit payable on behalf of a basic or police and fire member who was receiving disability benefits before July 1, 1997, which is first payable after June 30, 1997, must be increased on an actuarial equivalent basis to reflect the change in the postretirement interest rate actuarial assumption under section 356.215, subdivision 8, from five percent to six percent under a calculation procedure and tables adopted by the board and approved by the actuary retained under section 356.214. 

Subd. 4.Repayment of refund. 
Any person who has received a refund from the Public Employees Retirement Association and who is a member of any public retirement system referred to in subdivision 1, may repay such refund to the Public Employees Retirement Association as provided in section 353.35. 

Subd. 5.Early retirement. 
The requirements and provisions for retirement prior to normal retirement age contained in section 353.30, shall also apply to a person fulfilling such requirements with a combination of service as provided in subdivision 1. 

354.42 CONTRIBUTIONS BY EMPLOYER AND EMPLOYEE.Subd. 4a.Determination. 
(a) For purposes of this section, a contribution sufficiency exists if the total of the employee contributions, the employer contributions, and any additional employer contributions, if applicable, exceeds the total of the normal cost, the administrative expenses, and the amortization contribution of the retirement plan as reported in the most recent actuarial valuation of the retirement plan prepared by the approved actuary retained under section 356.214 and prepared under section 356.215 and the standards for actuarial work of the Legislative Commission on Pensions and Retirement. 

(b) For purposes of this section, a contribution deficiency exists if the total of the employee contributions, the employer contributions, and any additional employer contributions are less than the total of the normal cost, the administrative expenses, and the amortization contribution of the retirement plan as reported in the most recent actuarial valuation of the retirement plan prepared by the approved actuary retained under section 356.214 and prepared under section 356.215 and the standards for actuarial work of the Legislative Commission on Pensions and Retirement. 

Subd. 4b.Contribution rate revision. 
(a) Notwithstanding the contribution rate provisions under subdivisions 2 and 3, the Board of Trustees of the Teachers Retirement Association may adjust the employee and employer contribution rates if the regular actuarial valuation of the plan under section 356.215 indicates that there is a contribution sufficiency under subdivision 4a equal to or greater than one percent of covered payroll or if the regular valuation of the plan under section 356.215 indicates that there is a deficiency equal to or greater than one-half of one percent of covered payroll. Any decrease in employee and employer contribution rates must not result in the total of contribution rates that is less than the total of normal cost and administrative expenses. 

(b) To determine if an adjustment is to be made, the board of trustees shall consult with the approved actuary retained under section 356.214 and shall take into consideration factors that include, but are not limited to, the contribution rates based on actuarial value of assets and contribution rates based on the market value of assets; the funded ratio based on the actuarial value of assets and based on the market value of assets; the number of years remaining to the amortization target date; the recent experience of the investment markets; and the results of the 30-year funding, disbursements, and contributions projections prepared every other year as required under the standards for actuarial work adopted by the Legislative Commission on Pensions and Retirement. 

Subd. 4c.Contribution sufficiency measures. 
(a) A contribution sufficiency of up to one percent of covered payroll must be held in reserve to be used to offset any future actuarially required contributions that are more than the total combined employee and employer contributions being collected. 

(b) Before any reduction in contributions to eliminate a sufficiency in excess of one percent of covered pay may be recommended, the executive director must review any need for a change in actuarial assumptions, as recommended by the actuary retained under section 356.214 in the most recent experience study of the retirement plan, that may result in an increase in the actuarially required contribution and must report to the Legislative Commission on Pensions and Retirement any recommendation by the board to use the sufficiency exceeding one percent of covered payroll to offset the impact of an actuarial assumption change recommended by the actuary retained under section 356.214, subdivision 1, and reviewed by the actuary retained by the commission under section 356.214, subdivision 4. 

(c) A contribution sufficiency in excess of one percent of covered pay must not be used to increase benefits, and a benefit increase must not be proposed that would initiate an automatic adjustment under this section to increase contributions. A proposed benefit improvement must include a recommendation, prepared by the actuary retained under section 356.214, subdivision 1, and reviewed by the actuary retained by the Legislative Commission on Pensions and Retirement, as provided under section 356.214, subdivision 4, on the manner in which the benefit modification is to be funded. 

Subd. 4d.Reporting; commission review. 
A contribution rate increase or decrease made under subdivision 4b must be reported to the chair and the executive director of the Legislative Commission on Pensions and Retirement on or before the next February 1 and, if the Legislative Commission on Pensions and Retirement does not recommend against the rate change or does not recommend a modification in the rate change, is effective on the next July 1 following the determination that a contribution deficiency or sufficiency exists based on the most recent actuarial valuation under section 356.215. 

354.60 SERVICE IN OTHER PUBLIC RETIREMENT FUNDS; ANNUITY.
Any person who has been a member of the Minnesota state retirement system or the Public Employees Retirement Association including the Public Employees Retirement Association police and fire fund or the Teachers Retirement Association or the Minnesota State Patrol Retirement Association, or any other public employee retirement system in the state of Minnesota having a like provision but excluding all other funds providing benefits for police officers or firefighters shall be entitled when qualified to an annuity from each fund if the person's total allowable service in all three funds or in any two of these funds totals three or more years, provided no portion of the allowable service upon which the retirement annuity from one fund is based is again used in the computation for benefits from another fund and provided further that the person has not taken a refund from any one of these three funds since the person's membership in that association has terminated. The annuity from each fund shall be determined by the appropriate provisions of the law except that the requirement that an annuitant have at least three years' membership service or three years of allowable service in the respective association shall not apply for the purposes of this section provided the combined service in two or more of these funds equals three or more years. 

354A.12 CONTRIBUTIONS BY EMPLOYEE AND EMPLOYER.Subd. 2c.Duluth Teachers Retirement Fund Association; employer contributions for reemployed annuitants. 
The school district shall make the regular employer contributions and additional employer contributions specified in subdivision 2a on behalf of any retired member of the Duluth Teachers Retirement Fund Association who is reemployed by Independent School District No. 709, including providing service to the school district as an independent contractor or as an employee of an independent contractor. 

354A.29 ST. PAUL TEACHERS RETIREMENT FUND ASSOCIATION POSTRETIREMENT ADJUSTMENT.Subd. 8.Calculation of postretirement adjustments; percentage based. 
(a) For purposes of computing postretirement adjustments for eligible benefit recipients of the St. Paul Teachers Retirement Fund Association, the accrued liability funding ratio based on the actuarial value of assets of the plan as determined by the two most recent actuarial valuations prepared under sections 356.214 and 356.215 determines the postretirement increase, as follows: 

		Funding ratio	Postretirement increase	
		Less than 80 percent	1 percent	
		At least 80 percent but less than 90 percent	2 percent	

(b) The amount determined under paragraph (a) is the full postretirement increase to be applied as a permanent increase to the regular payment of each eligible member on January 1 of the next calendar year. For any eligible member whose effective date of benefit commencement occurred after January 1 of the calendar year immediately before the postretirement increase is applied, the amount determined under paragraph (a) must be reduced by 50 percent. 

(c) If the accrued liability funding ratio based on the actuarial value of assets is at least 90 percent in two consecutive actuarial valuations, subsequent postretirement increases must be paid as specified in subdivision 9. 

(d) If, following a postretirement increase under paragraph (a), the accrued liability funding ratio, based on the actuarial value of assets, falls below 80 percent for two consecutive actuarial valuations, the applicable postretirement increase must be reduced to one percent until January 1 of the calendar year next following the date on which the requirements for an increase under paragraph (a) are again satisfied. 

Subd. 9.Calculation of postretirement adjustments. 
(a) This subdivision applies if the requirements of subdivision 8, paragraph (c), have been satisfied. 

(b) A percentage adjustment must be paid under this subdivision to eligible persons under subdivision 7. 

(c) The amount of 2.5 percent is the full postretirement adjustment to be applied as a permanent increase to the regular payment of each eligible member on January 1 of the next calendar year. For any eligible member whose effective date of benefit commencement occurred after January 1 of the calendar year immediately before the postretirement adjustment is applied, the postretirement adjustment amount must be reduced by 50 percent. 

(d) In the event the accrued liability funding ratio based on the actuarial value of assets falls below 90 percent for two consecutive actuarial valuations, the applicable postretirement increase must be determined under subdivision 8 until January 1 of the calendar year next following the date on which the requirements of subdivision 8, paragraph (c), are again satisfied. 

354A.39 SERVICE IN OTHER PUBLIC RETIREMENT FUNDS; ANNUITY.
Any person who has been a member of the Minnesota State Retirement System, the Public Employees Retirement Association including the Public Employees Retirement Association Police and Fire Fund, the Teachers Retirement Association, the Minnesota State Patrol Retirement Association, the legislators retirement plan, the constitutional officers retirement plan, the St. Paul Teachers Retirement Fund Association coordinated program, or any other public employee retirement system in the state of Minnesota having a like provision, but excluding all other funds providing retirement benefits for police officers or firefighters, is entitled, when qualified, to an annuity from each fund if the person's total allowable service in all of the funds or in any two or more of the funds totals three or more years, provided that no portion of the allowable service upon which the retirement annuity from one fund is based is used again in the computation for a retirement annuity from another fund and provided further that the person has not taken a refund from any of funds or associations since the person's membership in the fund or association has terminated. The annuity from each fund or association must be determined by the appropriate provisions of the law governing each fund or association, except that the requirement that a person must have at least three years of allowable service in the respective fund or association does not apply for the purposes of this section, provided that the aggregate service in two or more of these funds equals three or more years. 

356.611 LIMITATION ON PUBLIC EMPLOYEE SALARIES FOR PENSION PURPOSES.Subd. 3.Maximum benefit limitations. 
An annuitant's annual benefit, if necessary, must be reduced to the extent required by section 415(b) of the federal Internal Revenue Code, as adjusted by the United States secretary of the treasury under section 415(d) of the federal Internal Revenue Code for any applicable increases in the cost of living, including applicable increases in the cost of living after the member's termination of employment. If an annuitant participated in more than one pension plan in which the employer participates, the benefits under each plan must be reduced proportionately, if necessary, to satisfy the applicable limitation. 

Subd. 3a.Maximum annual addition limitation, defined contribution plans. 
The annual additions on behalf of a member to a defined contribution plan for any limitation year shall not exceed the applicable limitation on annual additions under section 415(c) of the federal Internal Revenue Code, as adjusted by the United States secretary of the treasury under section 415(d) of the federal Internal Revenue Code. 

Subd. 4.Compensation. 
 For purposes of this section, compensation means a member's compensation actually paid or made available for any limitation year including all items of remuneration described in federal treasury regulation section 1.415 (c)-2(b) and excluding all items of remuneration described in federal treasury regulation section 1.415 (c)-2(c). Compensation for pension plan purposes for any limitation year shall not exceed the applicable federal compensation limit described in subdivision 2. 

Subd. 5.Limitation year. 
Unless otherwise specifically provided, for purposes of section 415 of the federal Internal Revenue Code, the limitation year of a pension plan covered by this section is the calendar year or fiscal year, whichever is applicable. 

356.96 PENSION PLAN APPEAL PROCEDURES.Subd. 14.Petitions without notice. 
Notwithstanding the petition notice and requirements under this section, a person who believes that the person's rights have been affected by a decision made by the administration of a covered pension plan may request a review under this section by the appropriate governing board. The petition under this subdivision must be made within 45 days of the time that the person knew or should have known of the disputed decision. 

Subd. 15.Governing board review panel. 
Any covered pension plan subject to this section, by motion duly made and adopted, may appoint a panel of governing board members to hear and determine any or all petitions brought under this section. The governing board review panel must contain a minimum number of board members that would otherwise constitute a quorum of board members under the governing body's rules and procedures. 

424A.02 DEFINED BENEFIT RELIEF ASSOCIATIONS; SERVICE PENSIONS.Subd. 13.Combined service pensions. 
(a) If the articles of incorporation or bylaws of the defined benefit relief associations so provide, a volunteer firefighter with credit for service as an active firefighter in more than one defined benefit volunteer firefighters relief association is entitled, when the applicable requirements of paragraph (b) are met and when otherwise qualified, to a prorated service credit from each relief association. 

(b) A volunteer firefighter receiving a prorated service pension under this subdivision must have a total amount of service credit of ten years or more, if the bylaws of every affected relief association do not specify only a five-year service vesting requirement, or five years or more, if the bylaws of every affected relief association require only a five-year service vesting requirement, as a member of two or more relief associations otherwise qualified. The member must have one year or more of service credit in each relief association. The prorated service pension must be based on the service pension amount in effect for the relief association on the date on which active volunteer firefighting services covered by that relief association terminate. To receive a service pension under this subdivision, the firefighter must become a member of the second or succeeding association and must give notice of membership to the prior association within two years of the date of termination of active service with the prior association. The notice must be attested to by the second or subsequent relief association secretary.