SF 1191

as introduced - 86th Legislature (2009 - 2010) Posted on 02/09/2010 02:19am

A bill for an act
relating to retirement; extending Fairmont Police Relief Association amortization
target date from 2010 to 2020; amending Minnesota Statutes 2008, section
69.77, subdivision 4.

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

Section 1.

Minnesota Statutes 2008, section 69.77, subdivision 4, is amended to read:

Subd. 4.

Relief association financial requirements; minimum municipal
obligation.

(a) The officers of the relief association shall determine the financial
requirements of the relief association and minimum obligation of the municipality for
the following calendar year in accordance with the requirements of this subdivision.
The financial requirements of the relief association and the minimum obligation of the
municipality must be determined on or before the submission date established by the
municipality under subdivision 5.

(b) The financial requirements of the relief association for the following calendar
year must be based on the most recent actuarial valuation or survey of the special fund of
the association if more than one fund is maintained by the association, or of the association,
if only one fund is maintained, prepared in accordance with sections 356.215, subdivisions
4 to 15, and 356.216, as required under subdivision 10. If an actuarial estimate is prepared
by the actuary of the relief association as part of obtaining a modification of the benefit
plan of the relief association and the modification is implemented, the actuarial estimate
must be used in calculating the subsequent financial requirements of the relief association.

(c) If the relief association has an unfunded actuarial accrued liability as reported in
the most recent actuarial valuation or survey, the total of the amounts calculated under
clauses (1), (2), and (3), constitute the financial requirements of the relief association for
the following year. If the relief association does not have an unfunded actuarial accrued
liability as reported in the most recent actuarial valuation or survey, the amount calculated
under clauses (1) and (2) constitute the financial requirements of the relief association for
the following year. The financial requirement elements are:

(1) the normal level cost requirement for the following year, expressed as a dollar
amount, which must be determined by applying the normal level cost of the relief
association as reported in the actuarial valuation or survey and expressed as a percentage
of covered payroll to the estimated covered payroll of the active membership of the relief
association, including any projected change in the active membership, for the following
year;

(2) for the Bloomington Fire Department Relief Association, the Fairmont Police
Relief Association, and the Virginia Fire Department Relief Association, to the dollar
amount of normal cost determined under clause (1) must be added an amount equal to the
dollar amount of the administrative expenses of the special fund of the association if more
than one fund is maintained by the association, or of the association if only one fund is
maintained, for the most recent year, multiplied by the factor of 1.035. The administrative
expenses are those authorized under section 69.80. No amount of administrative expenses
under this clause are to be included in the financial requirements of the Minneapolis
Firefighters Relief Association or the Minneapolis Police Relief Association; and

(3) to the dollar amount of normal cost and expenses determined under clauses
(1) and (2) must be added an amount equal to the level annual dollar amount which is
sufficient to amortize the unfunded actuarial accrued liability deleted text begin by December 31, 2010, the
Fairmont Police Relief Association, the Minneapolis Firefighters Relief Association,
and the Virginia Fire Department Relief Association, by the date determined under
section 356.216, paragraph (a), clause (2), for the Bloomington Fire Department Relief
Association, and by December 31, 2020, for the Minneapolis Police Relief Association, deleted text end as
determined from the actuarial valuation or survey of the fund, using an interest assumption
set at the applicable rate specified in section 356.215, subdivision 8 deleted text begin . The deleted text end new text begin , by that
fund's new text end amortization date new text begin as new text end specified in deleted text begin this clause applies to all local police or salaried
firefighters' relief associations and that date supersedes any amortization date specified in
any applicable special law deleted text end new text begin paragraph (d) new text end .

new text begin (d) The Minneapolis Firefighters Relief Association special fund and the Virginia
Fire Department Relief Association special fund amortization date is December 31, 2010.
The Minneapolis Police Relief Association special fund and the Fairmont Police Relief
Association special fund amortization date is December 31, 2020. The Bloomington Fire
Department Relief Association special fund amortization date is determined under section
356.216, paragraph (a), clause (2). The amortization date specified in this paragraph
supersedes any amortization date specified in any applicable special law.
new text end

deleted text begin (d) deleted text end new text begin (e) new text end The minimum obligation of the municipality is an amount equal to the
financial requirements of the relief association reduced by the estimated amount of
member contributions from covered salary anticipated for the following calendar year and
the estimated amounts anticipated for the following calendar year from the applicable
state aid program established under sections 69.011 to 69.051 receivable by the relief
association after any allocation made under section 69.031, subdivision 5, paragraph (b),
clause (2), or 423A.01, subdivision 2, paragraph (a), clause (6), from the local police
and salaried firefighters' relief association amortization aid program established under
section 423A.02, subdivision 1, from the supplementary amortization state-aid program
established under section 423A.02, subdivision 1a, and from the additional amortization
state aid under section 423A.02, subdivision 1b.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective the day following final enactment
and applies to municipal contributions made on or after that date.
new text end