SF 717

as introduced - 80th Legislature (1997 - 1998) Posted on 12/15/2009 12:00am

  1.1                          A bill for an act 
  1.2             relating to retirement; modifying provisions governing 
  1.3             deferred compensation in the Minnesota state 
  1.4             retirement system; making technical changes; amending 
  1.5             Minnesota Statutes 1996, section 352.96, subdivisions 
  1.6             2, 3, and 6. 
  1.7   BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
  1.8      Section 1.  Minnesota Statutes 1996, section 352.96, 
  1.9   subdivision 2, is amended to read: 
  1.10     Subd. 2.  [PURCHASE OF SHARES.] The amount of compensation 
  1.11  so deferred may be used to purchase: 
  1.12     (1) shares in the Minnesota supplemental investment fund 
  1.13  established in section 11A.17; 
  1.14     (2) saving accounts in federally insured financial 
  1.15  institutions; 
  1.16     (3) life insurance contracts, fixed annuity and variable 
  1.17  annuity contracts from companies that are subject to regulation 
  1.18  by the commissioner of commerce; or 
  1.19     (4) investment options from open-end investment companies 
  1.20  registered under the federal Investment Company Act of 1940, 
  1.21  United States Code, title 15, sections 80a-1 to 80a-64; 
  1.22     (5) investment options from a firm that is a registered 
  1.23  investment advisor under the Investment Advisors Act of 1940, 
  1.24  United States Code, title 15, section 80b-1 to 80b-21; 
  1.25     (6) investment options of a bank as defined in United 
  1.26  States Code, title 15, section 80b-2, subsection (a), paragraph 
  2.1   (2), or a bank holding company as defined in the Bank Holding 
  2.2   Company Act of 1956, United States Code, title 12, section 1841, 
  2.3   subsection (a), paragraph (1); or 
  2.4      (7) a combination of clause (1), (2), or (3), (4), (5), or 
  2.5   (6), as provided by the plan as specified by the participant. 
  2.6      The shares accounts or contracts purchased shall stand in 
  2.7   the name of the state or other employing unit, for the officer 
  2.8   or employee whose deferred compensation purchased the shares, 
  2.9   until distributed to the officer or employee in a manner agreed 
  2.10  upon by the employee and the executive director of the Minnesota 
  2.11  state retirement system, acting for the employer.  All amounts 
  2.12  contributed to the deferred compensation plan and all earnings 
  2.13  on those amounts will be held for the exclusive benefit of the 
  2.14  plan participants and beneficiaries.  These amounts will be held 
  2.15  in trust, in custodial accounts, or in qualifying annuity 
  2.16  contracts as required by federal law and in accordance with 
  2.17  section 356A.06, subdivision 1.  This subdivision does not 
  2.18  authorize an employer contribution, except as authorized in 
  2.19  section 356.24, paragraph (a), clause (4).  The state, political 
  2.20  subdivision, or other employing unit is not responsible for any 
  2.21  loss that may result from investment of the deferred 
  2.22  compensation. 
  2.23     Sec. 2.  Minnesota Statutes 1996, section 352.96, 
  2.24  subdivision 3, is amended to read: 
  2.25     Subd. 3.  [EXECUTIVE DIRECTOR TO ADMINISTER SECTION.] This 
  2.26  section must be administered by the executive director of the 
  2.27  system with the advice and consent of the board of directors 
  2.28  under subdivision 4.  Fiduciary activities of the deferred 
  2.29  compensation plan must be undertaken in a manner consistent with 
  2.30  chapter 356A.  If the state board of investment so elects, it 
  2.31  may solicit bids for options under subdivision 2, clauses 
  2.32  (2) and, (3), (4), (5), and (6).  The state board of investment 
  2.33  may retain consulting services to assist it in soliciting and 
  2.34  evaluating bids and in the periodic review of companies offering 
  2.35  options under subdivision 2, clause clauses (3), (4), (5), and 
  2.36  (6).  The periodic review must occur at least every two years.  
  3.1   The state board of investment may annually establish a budget 
  3.2   for its costs in the soliciting, evaluating, and periodic review 
  3.3   processes.  The state board of investment may charge a 
  3.4   proportional share of all costs related to the periodic review 
  3.5   to each company currently under contract and may charge a 
  3.6   proportional share of all costs related to soliciting and 
  3.7   evaluating bids to each company selected by the state board.  
  3.8   All contracts must be approved before execution by the state 
  3.9   board of investment.  Contracts must provide that all options in 
  3.10  subdivision 2 must:  be presented in an unbiased manner and in a 
  3.11  manner that conforms to rules adopted by the executive director, 
  3.12  be reported on a periodic basis to all employees participating 
  3.13  in the deferred compensation program, and not be the subject of 
  3.14  unreasonable solicitation of state employees to participate in 
  3.15  the program.  The contract may not call for any person to 
  3.16  jeopardize the tax-deferred status of money invested by state 
  3.17  employees under this section.  All costs or fees in relation to 
  3.18  the options provided under subdivision 2, clause 
  3.19  clauses (3), (4), (5), and (6), must be paid by the underwriting 
  3.20  companies ultimately selected by the state board of investment. 
  3.21     Sec. 3.  Minnesota Statutes 1996, section 352.96, 
  3.22  subdivision 6, is amended to read: 
  3.23     Subd. 6.  [EXEMPTION FROM PROCESS.] As money to which legal 
  3.24  title is vested in the state of Minnesota held under section 
  3.25  356A.06, subdivision 1, no amount of deferred compensation is 
  3.26  assignable or subject to execution, levy, attachment, 
  3.27  garnishment, or other legal process, except as provided in 
  3.28  section 518.58, 518.581, or 518.611. 
  3.29     Sec. 4.  [EFFECTIVE DATE.] 
  3.30     Sections 1 to 3 are effective the day following final 
  3.31  enactment.