Minnesota Legislature
SF 746
as introduced - 90th Legislature (2017 - 2018) Posted on 06/21/2018 02:30pm
Current Version - as introduced
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A bill for an act
relating to retirement; Teachers Retirement Association; administrative provisions;
revising the definition of teacher; extending the retirement application deadline;
creating a procedure for payment upon the death of member's former spouse;
revising reporting requirements; modifying augmentation provisions for periods
of uninterrupted service; clarifying part-time teacher provisions; making other
changes of an administrative nature; amending Minnesota Statutes 2016, sections
354.05, subdivision 2; 354.44, subdivision 3; 354.45, by adding a subdivision;
354.512; 354.52, subdivision 4d; 354.55, subdivision 11; 354.66, subdivision 2;
354.72, subdivision 1.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:
Section 1.
Minnesota Statutes 2016, section 354.05, subdivision 2, is amended to read:
Subd. 2.
Teacher.
(a) "Teacher" means:
(1) a person who renders service as a teacher, supervisor, principal, superintendent,
librarian, nurse, counselor, social worker, therapist, or psychologist innew text begin :
new text end
new text begin (i)new text end a public school of the state other than in Independent School District No. 625 deleted text begin or in
Independent School District No. 709, or in anydeleted text end new text begin ;
new text end
new text begin (ii) anew text end charter schooldeleted text begin , irrespective of the location of the school, or in anydeleted text end new text begin ;
new text end
new text begin (iii) anew text end charitable, penal, or correctional deleted text begin institutionsdeleted text end new text begin institution new text end of a governmental
subdivisiondeleted text begin ,deleted text end new text begin ;new text end or
new text begin
(iv) the Perpich Center for Arts Education, except that any employee of the Perpich
Center for Arts Education who was covered by the Minnesota State Retirement System
general state employees retirement plan as of July 1, 2016, shall continue to be covered by
that plan and not by the Teachers Retirement Association;
new text end
new text begin (2) a personnew text end who is engaged in educational administration in connection with the state
public school system, whether the position be a public office or deleted text begin andeleted text end new text begin as new text end employment;
new text begin
(3) a person who renders service as a charter school director or chief administrative
officer; provided, however, that if the charter school director or chief administrative officer
is covered by the Public Employees Retirement Association general employees retirement
plan on July 1, 2017, the charter school director or chief administrative officer shall continue
to be covered by that plan and not by the Teachers Retirement Association;
new text end
deleted text begin (2)deleted text end new text begin (4) new text end an employee of the Teachers Retirement Association;
deleted text begin (3)deleted text end new text begin (5) new text end a person who renders teaching service on a part-time basis and who also renders
other services for a single employing unit where the teaching service comprises at least 50
percent of the combined employment salary is a member of the association for all services
with the single employing unit or, if less than 50 percent of the combined employment
salary, the executive director determines all of the combined service is covered by the
association; or
deleted text begin (4)deleted text end new text begin (6) new text end a person who is not covered by the plans established under chapter 352D, 354A,
or 354B and who is employed by the Board of Trustees of the Minnesota State Colleges
and Universities system in an unclassified position as:
(i) a president, vice-president, or dean;
(ii) a manager or a professional in an academic or an academic support program other
than specified in item (i);
(iii) an administrative or a service support faculty position; or
(iv) a teacher or a research assistant.
(b) "Teacher" does not mean:
(1) a person who works for a school or institution as an independent contractor as defined
by the Internal Revenue Service;
deleted text begin
(2) a person who renders part-time teaching service or who is a customized trainer as
defined by the Minnesota State Colleges and Universities system if (i) the service is incidental
to the regular nonteaching occupation of the person; and (ii) the employer stipulates annually
in advance that the part-time teaching service or customized training service will not exceed
300 hours in a fiscal year and retains the stipulation in its records; and (iii) the part-time
teaching service or customized training service actually does not exceed 300 hours in a
fiscal year;
deleted text end
deleted text begin
(3) a person exempt from licensure under section 122A.30;
deleted text end
deleted text begin (4)deleted text end new text begin (2) new text end annuitants of the teachers retirement plan who are employed after retirement by
an employing unit that participates in the teachers retirement plan during the course of that
reemployment;
deleted text begin (5)deleted text end new text begin (3) new text end a person who is employed by the University of Minnesota;
deleted text begin (6)deleted text end new text begin (4) new text end a member or an officer of any general governing or managing board or body of
an employing unit that participates in the teachers retirement plan; or
deleted text begin (7)deleted text end new text begin (5) new text end a person employed by Independent School District No. 625 deleted text begin or Independent School
District No. 709deleted text end as a teacher as defined in section 354A.011, subdivision 27.
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective July 1, 2017.
new text end
Sec. 2.
Minnesota Statutes 2016, section 354.44, subdivision 3, is amended to read:
Subd. 3.
Application for retirement.
A member or a person authorized to act on behalf
of the member may make application for retirement provided the age and service
requirements under subdivision 1 are satisfied on or before the member's retirement annuity
accrual date under subdivision 4. The application may be made no earlier than deleted text begin 120deleted text end new text begin 180 new text end days
before the termination of teaching service. The application must be made on a form prescribed
by the executive director and is not complete until all necessary supporting documents are
received by the executive director.
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective July 1, 2018.
new text end
Sec. 3.
Minnesota Statutes 2016, section 354.45, is amended by adding a subdivision to
read:
new text begin Subd. 3. new text end
new text begin Payment upon death of former spouse. new text end
new text begin
Upon the death of the former spouse
to whom payments are to be made before the end of the specified payment period, payments
shall be made according to the terms of a beneficiary form completed by the former spouse
or, if no beneficiary form, to the estate of the former spouse or as otherwise ordered by a
court of competent jurisdiction.
new text end
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective July 1, 2017.
new text end
Sec. 4.
Minnesota Statutes 2016, section 354.512, is amended to read:
354.512 RECOVERY OF DEFICIENCIES.
In addition to any other remedies permitted under law, if an employing unit or other
entity required by law to make any form of payment to the Teachers Retirement Association
fails to make full payment deleted text begin within 60 days of notificationdeleted text end , the executive director is authorized
to certify the amount of deficiency to the commissioner of management and budget, who
shall deduct the amount from any state aid or appropriation applicable to the employing
unit or entity, and transmit the withheld aid or appropriation to the executive director for
deposit in the fund.
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective July 1, 2017.
new text end
Sec. 5.
Minnesota Statutes 2016, section 354.52, subdivision 4d, is amended to read:
Subd. 4d.
Annual base salary reporting.
An employing unit must provide deleted text begin the followingdeleted text end
new text begin annual base salary new text end datanew text begin , as defined in section 354.05, subdivision 41,new text end to the association on
or before June 30 of each fiscal yeardeleted text begin : (1) annual base salary, as defined in section 354.05,
subdivision 41; anddeleted text end new text begin .
new text end
deleted text begin
(2) beginning and ending dates for the regular school work year.
deleted text end
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective the day following final enactment.
new text end
Sec. 6.
Minnesota Statutes 2016, section 354.55, subdivision 11, is amended to read:
Subd. 11.
Deferred annuity; augmentation.
(a) Any person covered under section
354.44, subdivision 6, who ceases to render teaching service, may leave the person's
accumulated deductions in the fund for the purpose of receiving a deferred annuity at
retirement.
(b) The amount of the deferred retirement annuity is determined by section 354.44,
subdivision 6, and augmented as provided in this subdivision. The required reserves for the
annuity which had accrued when the member ceased to render teaching service must be
augmented, as further specified in this subdivision, by the applicable interest rate compounded
annually from the first day of the month following the month during which the member
ceased to render teaching service to the effective date of retirement.
(c) No augmentation is not creditable if the deferral period is less than three months or
if deferral commenced before July 1, 1971.
(d) For persons who became covered employees before July 1, 2006, with a deferral
period commencing after June 30, 1971, the annuity must be augmented as follows:
(1) five percent interest compounded annually until January 1, 1981;
(2) three percent interest compounded annually from January 1, 1981, until January 1
of the year following the year in which the deferred annuitant attains age 55;
(3) five percent interest compounded annually from the date established in clause (2) to
the effective date of retirement or until June 30, 2012, whichever is earlier; and
(4) two percent interest compounded annually after June 30, 2012.
(e) For persons who become covered employees after June 30, 2006, the interest rate
used to augment the deferred annuity is 2.5 percent interest compounded annually until June
30, 2012, or until the effective date of retirement, whichever is earlier, and two percent
interest compounded annually after June 30, 2012.
deleted text begin
(f) If a person has more than one period of uninterrupted service, a separate average
salary determined under section 354.44, subdivision 6, must be used for each period and
the required reserves related to each period must be augmented as specified in this
subdivision. The sum of the augmented required reserves is the present value of the annuity.
For the purposes of this subdivision, "period of uninterrupted service" means a period of
covered teaching service during which the member has not been separated from active
service for more than one fiscal year.
deleted text end
deleted text begin (g)deleted text end new text begin (f) new text end If a person repays a refund, the service restored by the repayment must be
considered as continuous with the next period of service for which the person has allowable
service credit in the Teachers Retirement Association.
deleted text begin (h)deleted text end new text begin (g) new text end If a person does not render teaching service in any one fiscal year or more
consecutive fiscal years and then resumes teaching service, the formula percentages used
from the date of the resumption of teaching service must be those applicable to new members.
deleted text begin (i)deleted text end new text begin (h) new text end The mortality table and interest rate actuarial assumption used to compute the
annuity must be the applicable mortality table established by the board under section 354.07,
subdivision 1, and the interest rate actuarial assumption under section 356.215 in effect
when the member retires.
deleted text begin (j)deleted text end new text begin (i) new text end In no case may the annuity payable under this subdivision be less than the amount
of annuity payable under section 354.44, subdivision 6.
deleted text begin (k)deleted text end new text begin (j) new text end The requirements and provisions for retirement before normal retirement age
contained in section 354.44, subdivision 6, also apply to an employee fulfilling the
requirements with a combination of service as provided in section 354.60.
deleted text begin (l)deleted text end new text begin (k) new text end The augmentation provided by this subdivision applies to the benefit provided in
section 354.46, subdivision 2.
deleted text begin (m)deleted text end new text begin (l) new text end The augmentation provided by this subdivision does not apply to any period in
which a person is on an approved leave of absence from an employer unit covered by the
provisions of this chapter.
deleted text begin (n)deleted text end new text begin (m) new text end The retirement annuity or disability benefit of, or the survivor benefit payable
on behalf of, a former teacher 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 as recommended by an approved actuary and approved by the
actuary retained under section 356.214.
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective July 1, 2018.
new text end
Sec. 7.
Minnesota Statutes 2016, section 354.66, subdivision 2, is amended to read:
Subd. 2.
Qualified part-time teacher program participation requirements.
(a) A
teacher in a Minnesota public elementary school, a Minnesota secondary school, or the
Minnesota State Colleges and Universities system who has three years or more of allowable
service in the association or three years or more of full-time teaching service in Minnesota
public elementary schools, Minnesota secondary schools, or the Minnesota State Colleges
and Universities system, by agreement with the board of the employing district or with the
authorized representative of the board, may be assigned to teaching service in a part-time
teaching position under subdivision 3. The agreement must be executed before October 1
of the school year for which the teacher deleted text begin requests to make retirement contributions under
subdivision 4deleted text end new text begin has been assigned to teaching service in a part-time teaching position under
this sectionnew text end . A copy of the executed agreement must be filed with the executive director of
the association. If the copy of the executed agreement is filed with the association after
October 1 of the school year for which the teacher deleted text begin requests to make retirement contributions
under subdivision 4deleted text end new text begin has been assigned to teaching service in a part-time teaching positionnew text end ,
the employing unit shall pay the fine specified in section 354.52, subdivision 6, for each
calendar day that elapsed since the October 1 due datenew text begin , unless the association waives the
finenew text end . The association may not accept an executed agreement that is received by the association
more than 15 months late. deleted text begin The association may not waive the fine required by this section.
deleted text end
(b) Notwithstanding paragraph (a), if the teacher is also a legislator:
(1) the agreement in paragraph (a) must be executed before March 1 of the school year
for which the teacher requests to make retirement contributions under subdivision 4; and
(2) the fines specified in paragraph (a) apply if the employing unit does not file the
executed agreement with the executive director of the association by March 1.
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective July 1, 2017.
new text end
Sec. 8.
Minnesota Statutes 2016, section 354.72, subdivision 1, is amended to read:
Subdivision 1.
Application.
This section applies to any strike period under section
354.05, subdivision 13, clause (6), and to any period of authorized leave of absence deleted text begin without
paydeleted text end under sections 354.093, 354.094, 354.095, and 354.096 for which the teacher obtains
credit for allowable service by making payment as specified in this section to the Teachers
Retirement Association fund. Each year of an extended leave of absence under section
354.094 is considered to be a separate leave for purposes of this section.