HF 3266

as introduced - 92nd Legislature (2021 - 2022) Posted on 02/10/2022 02:06pm

A bill for an act
relating to retirement; Public Employees Retirement Association; reinstating
segmented annuities and providing for retroactive implementation; amending
Minnesota Statutes 2020, section 353.34, by adding a subdivision.

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

Section 1.

Minnesota Statutes 2020, section 353.34, is amended by adding a subdivision
to read:

new text begin Subd. 3c. new text end

new text begin Segmented annuities. new text end

new text begin (a) If a person who is entitled to an annuity has more
than one period of uninterrupted service, the person is entitled to augmentation under
subdivision 3, applied to each period of uninterrupted service. The average salary used to
calculate the annuity for each period of uninterrupted service must be applied as if the person
was a new employee at the beginning of each period of uninterrupted service. The actuarial
assumptions used to calculate the annuity must be those in effect on the effective date of
retirement.
new text end

new text begin (b) For the purpose of this subdivision, "uninterrupted service" means periods of covered
employment during which the person has not been separated from public service for more
than two years.
new text end

new text begin (c) If a person repays a refund, the restored service must be considered as continuous
with the next period of service for which the person has credit with the association.
new text end

new text begin (d) This subdivision applies to persons who become deferred annuitants on or after July
1, 1971. For a person 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.
new text end

new text begin (e) This subdivision must not reduce the annuity otherwise payable under this chapter.
new text end

new text begin EFFECTIVE DATE. new text end

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

Sec. 2. new text begin RETROACTIVE IMPLEMENTATION.
new text end

new text begin (a) For the purpose of this section, "eligible retiree" means a person:
new text end

new text begin (1) who began to receive a retirement annuity under Minnesota Statutes, chapter 353 or
353E, after June 30, 2018, and before the effective date;
new text end

new text begin (2) who at the time of the person's annuity start date would have been entitled to
augmentation for more than one period of uninterrupted service had section 1 been in effect
at the annuity start date; and
new text end

new text begin (3) for whom a retirement annuity calculated under section 1 is greater than the retirement
annuity to which the person was entitled on the annuity start date.
new text end

new text begin (b) Within 90 days following the effective date, the executive director of the Public
Employees Retirement Association must notify each eligible retiree of the monthly amount
of the annuity to which the eligible retiree would have been entitled had section 1 been in
effect at the eligible retiree's annuity start date. The notice must include the corresponding
monthly amounts payable under any optional forms of annuity to which the eligible retiree
was entitled at the annuity start date and is entitled on the date of the notice.
new text end

new text begin (c) For each eligible retiree, the executive director must adjust the ongoing annuity
amount so that it is the amount calculated under section 1, taking into account any election
of any optional annuity forms of payment and any postretirement increases.
new text end

new text begin (d) The executive director must offer a lump sum distribution to the eligible retiree of
the difference between the monthly amount determined under section 1 and the monthly
amount being paid to the eligible retiree, multiplied by the number of monthly payments
made to the eligible retiree before the annuity calculated under section 1 begins. The lump
sum must be adjusted to take into account any election of any optional annuity forms of
payment and any postretirement increases. The eligible retiree may elect a distribution of
the lump sum or a direct rollover under Minnesota Statutes, section 356.635, subdivisions
3 to 7, if the lump sum is an eligible rollover distribution as defined in Minnesota Statutes,
section 356.635, subdivisions 4 and 5.
new text end

new text begin EFFECTIVE DATE. new text end

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