SF 1321

1st Engrossment - 82nd Legislature (2001 - 2002) Posted on 12/15/2009 12:00am

  1.1                          A bill for an act
  1.2             relating to retirement; various statewide and local 
  1.3             retirement plans; clarifying the eligibility for 
  1.4             retirement coverage for various Minnesota state 
  1.5             colleges and universities system employees; 
  1.6             implementing various public pension plan 
  1.7             administrative modifications; including fugitive 
  1.8             apprehension officers in the state patrol retirement 
  1.9             plan; expanding public employee retirement association 
  1.10            general plan membership eligibility; prorating service 
  1.11            credit for certain general public employee retirement 
  1.12            plan members; extending certain unfunded actuarial 
  1.13            accrued liability amortization target dates; 
  1.14            eliminating mortality gain and loss transfers for the 
  1.15            Minnesota postretirement investment fund; increasing 
  1.16            general public employee retirement plan member and 
  1.17            employer contribution rates; creating a direct state 
  1.18            aid for the general public employees retirement plan; 
  1.19            transferring noncertificated public school employees 
  1.20            to membership in the teachers retirement association; 
  1.21            mandating a statewide retirement plan administrative 
  1.22            consolidation feasibility study; mandating an 
  1.23            educational employees retirement plan aggregation 
  1.24            feasibility study; funding unpaid retirement 
  1.25            contributions from certain closed charter schools; 
  1.26            codifying and revising the Minneapolis firefighters 
  1.27            relief association law; requiring insurance by certain 
  1.28            volunteer firefighter relief association financial 
  1.29            consultants; authorizing payment of volunteer 
  1.30            firefighters relief association service pensions to 
  1.31            certain full-time White Bear Lake fire department 
  1.32            employees; appropriating money; amending Minnesota 
  1.33            Statutes 2000, sections 3A.03, subdivision 2; 11A.18, 
  1.34            subdivisions 7, 11; 352.01, subdivisions 2a, 2b; 
  1.35            352.113, subdivisions 4, 6; 352.22, subdivision 8; 
  1.36            352.87, subdivisions 4, 5; 352.95, subdivisions 4, 5, 
  1.37            7; 352B.01, subdivisions 2, 11; 352B.10, subdivision 
  1.38            3; 352B.101; 353.01, subdivisions 1, 2, 2a, 2b, 6, 7, 
  1.39            11b, 12, 12a, 16, by adding subdivisions; 353.026; 
  1.40            353.03, subdivision 1; 353.27, subdivisions 2, 3, 4, 
  1.41            10, 11; 353.28, subdivision 8; 353.86, subdivision 1; 
  1.42            354.05, subdivision 2; 354.52, subdivision 4; 
  1.43            354A.011, subdivision 24; 354A.12, subdivision 5; 
  1.44            354A.31, subdivision 3; 354A.35, subdivision 4; 
  1.45            356.215, subdivision 4g; 356A.06, subdivision 5; 
  1.46            424A.04, by adding a subdivision; 490.121, subdivision 
  2.1             4; proposing coding for new law in Minnesota Statutes, 
  2.2             chapters 13; 353; 354; 354A; proposing coding for new 
  2.3             law as Minnesota Statutes, chapter 423C; repealing 
  2.4             Minnesota Statutes 2000, section 354A.026; Laws 1907, 
  2.5             chapter 24; Laws 1913, chapter 318; Laws 1913, chapter 
  2.6             419; Laws 1917, chapter 196; Laws 1919, chapter 515; 
  2.7             Laws 1919, chapter 523; Laws 1921, chapter 404; Laws 
  2.8             1923, chapter 61; Laws 1945, chapter 322; Laws 1959, 
  2.9             chapter 213; Laws 1959, chapter 491; Laws 1959, 
  2.10            chapter 568; Laws 1961, chapter 109; Extra Session 
  2.11            Laws 1961, chapter 3; Laws 1963, chapter 318; Laws 
  2.12            1965, chapter 519; Laws 1965, chapter 578; Laws 1967, 
  2.13            chapter 819; Laws 1967, chapter 824; Laws 1969, 
  2.14            chapter 123; Laws 1969, chapter 287; Laws 1971, 
  2.15            chapter 542; Laws 1975, chapter 57; Laws 1977, chapter 
  2.16            164, section 2; Laws 1980, chapter 607, article XV, 
  2.17            sections 8, 9, 10; Laws 1988, chapter 572, sections 4, 
  2.18            5, 6; Laws 1988, chapter 574, sections 3, 4, 5; Laws 
  2.19            1989, chapter 319, article 19, sections 6, 7; Laws 
  2.20            1990, chapter 589, article 1, sections 5, 6; Laws 
  2.21            1992, chapter 429; Laws 1992, chapter 454, section 2; 
  2.22            Laws 1992, chapter 471, article 2; Laws 1993, chapter 
  2.23            125; Laws 1993, chapter 192, section 32; Laws 1994, 
  2.24            chapter 591; Laws 1994, chapter 632, article 3, 
  2.25            section 14; Laws 1996, chapter 448, article 2, section 
  2.26            3; Laws 1996, chapter 448, article 3, section 1; Laws 
  2.27            1997, chapter 233, article 4, sections 12, 13, 14, 15, 
  2.28            16, 17, 18, 19, 20, 21, 22; Laws 1998, chapter 390, 
  2.29            article 7, section 2; Laws 2000, chapter 461, article 
  2.30            17, sections 6, 7, 8, 9, 10, 11, 12, 13. 
  2.31  BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
  2.32                             ARTICLE 1 
  2.33                 VARIOUS ADMINISTRATIVE PROVISIONS
  2.34     Section 1.  Minnesota Statutes 2000, section 3A.03, 
  2.35  subdivision 2, is amended to read: 
  2.36     Subd. 2.  [REFUND.] (1) Any person former member who has 
  2.37  made contributions pursuant to under subdivision 1 who is no 
  2.38  longer a member of the legislature is entitled to receive upon 
  2.39  application to the director a refund of all contributions 
  2.40  credited to the member's account with interest at an annual rate 
  2.41  of six percent compounded annually.  
  2.42     (2) The refund of contributions as provided in clause (1) 
  2.43  terminates all rights of a former member of the legislature or 
  2.44  survivors of the former member under this chapter.  Should the 
  2.45  former member of the legislature again be a member of the 
  2.46  legislature after having taken a refund as provided above, the 
  2.47  member shall be considered a new member.  However, a new member 
  2.48  may reinstate the rights and credit for service forfeited, 
  2.49  provided the new member repays all refunds taken plus interest 
  2.50  at an annual rate of 8.5 percent compounded annually.  
  3.1      (3) No person shall be required to apply for or accept a 
  3.2   refund. 
  3.3      Sec. 2.  Minnesota Statutes 2000, section 11A.18, 
  3.4   subdivision 7, is amended to read: 
  3.5      Subd. 7.  [PARTICIPATION AND FINANCIAL REPORTING IN FUND.] 
  3.6   (a) Each participating public retirement fund or plan which has 
  3.7   transferred money to the state board for investment in the 
  3.8   postretirement investment fund shall have an undivided 
  3.9   participation in the fund.  The participation on any valuation 
  3.10  date shall be determined by adding to the participation on the 
  3.11  prior valuation date:  (a) (1) funds transferred in accordance 
  3.12  with subdivision 6, (b) (2) the amount of required investment 
  3.13  income on its participation as defined in subdivision 9, clause 
  3.14  (1)(c) paragraph (c), clause (1), and (c) (3) the reserves for 
  3.15  any benefit adjustment made as of the current valuation date 
  3.16  with the result adjusted for any mortality gains or losses 
  3.17  determined pursuant to under subdivision 11.  
  3.18     (b) The total fair market value of the postretirement fund 
  3.19  as of June 30 must be calculated in accordance with generally 
  3.20  accepted accounting principles.  The fair market value share of 
  3.21  each fund participating in the postretirement investment fund 
  3.22  shall be allocated by adding to the fair market value at the 
  3.23  beginning of the fiscal year:  (1) 100 percent of the funds 
  3.24  transferred in accordance with subdivision 6; and (2) a pro rata 
  3.25  distribution of unrealized gains or losses, based on a weighted 
  3.26  percentage of participation at the end of each month of the 
  3.27  fiscal year. 
  3.28     Sec. 3.  [13.632] [TEACHERS RETIREMENT FUND ASSOCIATION 
  3.29  DATA; CERTAIN CITIES.] 
  3.30     Subdivision 1.  [BENEFICIARY AND SURVIVOR DATA.] The 
  3.31  following data on beneficiaries and survivors of the Minneapolis 
  3.32  teachers retirement fund association, the St. Paul teachers 
  3.33  retirement fund association, and the Duluth teachers retirement 
  3.34  fund association members are private data on individuals:  home 
  3.35  address, date of birth, direct deposit number, and tax 
  3.36  withholding data. 
  4.1      Subd. 2.  [LIMITS ON DISCLOSURE.] Required disclosure of 
  4.2   data about members, survivors, and beneficiaries is limited to 
  4.3   name, gross annuity, or benefit and type of annuity or benefit 
  4.4   awarded. 
  4.5      Sec. 4.  Minnesota Statutes 2000, section 352.01, 
  4.6   subdivision 2a, is amended to read: 
  4.7      Subd. 2a.  [INCLUDED EMPLOYEES.] (a) "State employee" 
  4.8   includes: 
  4.9      (1) employees of the Minnesota historical society; 
  4.10     (2) employees of the state horticultural society; 
  4.11     (3) employees of the Disabled American Veterans, Department 
  4.12  of Minnesota, Veterans of Foreign Wars, Department of Minnesota, 
  4.13  if employed before July 1, 1963; 
  4.14     (4) employees of the Minnesota crop improvement 
  4.15  association; 
  4.16     (5) employees of the adjutant general who are paid from 
  4.17  federal funds and who are not covered by any federal civilian 
  4.18  employees retirement system; 
  4.19     (6) employees of the Minnesota state colleges and 
  4.20  universities employed under the university or college activities 
  4.21  program; 
  4.22     (7) currently contributing employees covered by the system 
  4.23  who are temporarily employed by the legislature during a 
  4.24  legislative session or any currently contributing employee 
  4.25  employed for any special service as defined in subdivision 2b, 
  4.26  clause (8); 
  4.27     (8) employees of the armory building commission; 
  4.28     (9) employees of the legislature appointed without a limit 
  4.29  on the duration of their employment and persons employed or 
  4.30  designated by the legislature or by a legislative committee or 
  4.31  commission or other competent authority to conduct a special 
  4.32  inquiry, investigation, examination, or installation; 
  4.33     (10) trainees who are employed on a full-time established 
  4.34  training program performing the duties of the classified 
  4.35  position for which they will be eligible to receive immediate 
  4.36  appointment at the completion of the training period; 
  5.1      (11) employees of the Minnesota safety council; 
  5.2      (12) any employees on authorized leave of absence from the 
  5.3   transit operating division of the former metropolitan transit 
  5.4   commission who are employed by the labor organization which is 
  5.5   the exclusive bargaining agent representing employees of the 
  5.6   transit operating division; 
  5.7      (13) employees of the metropolitan council, metropolitan 
  5.8   parks and open space commission, metropolitan sports facilities 
  5.9   commission, metropolitan mosquito control commission, or 
  5.10  metropolitan radio board unless excluded or covered by another 
  5.11  public pension fund or plan under section 473.415, subdivision 
  5.12  3; 
  5.13     (14) judges of the tax court; 
  5.14     (15) personnel employed on June 30, 1992, by the University 
  5.15  of Minnesota in the management, operation, or maintenance of its 
  5.16  heating plant facilities, whose employment transfers to an 
  5.17  employer assuming operation of the heating plant facilities, so 
  5.18  long as the person is employed at the University of Minnesota 
  5.19  heating plant by that employer or by its successor organization; 
  5.20  and 
  5.21     (16) seasonal help in the classified service employed by 
  5.22  the department of revenue; and 
  5.23     (17) a person who renders teaching or other service for the 
  5.24  Minnesota state colleges and universities system and who also 
  5.25  renders service on a part-time basis for an employer with 
  5.26  employees covered by the general state employees retirement plan 
  5.27  of the Minnesota state retirement system, for all service with 
  5.28  the Minnesota state colleges and universities system, if the 
  5.29  person's nonteaching service comprises at least 50 percent of 
  5.30  the combined total salary received by the person as determined 
  5.31  by the chancellor of the Minnesota state colleges and 
  5.32  universities system or if the person is certified for general 
  5.33  state employees retirement plan coverage by the chancellor of 
  5.34  the Minnesota state colleges and universities system. 
  5.35     (b) Employees specified in paragraph (a), clause (15), are 
  5.36  included employees under paragraph (a) if employer and employee 
  6.1   contributions are made in a timely manner in the amounts 
  6.2   required by section 352.04.  Employee contributions must be 
  6.3   deducted from salary.  Employer contributions are the sole 
  6.4   obligation of the employer assuming operation of the University 
  6.5   of Minnesota heating plant facilities or any successor 
  6.6   organizations to that employer. 
  6.7      Sec. 5.  Minnesota Statutes 2000, section 352.01, 
  6.8   subdivision 2b, is amended to read: 
  6.9      Subd. 2b.  [EXCLUDED EMPLOYEES.] "State employee" does not 
  6.10  include: 
  6.11     (1) elective state officers; 
  6.12     (2) students employed by the University of Minnesota, or 
  6.13  the state colleges and universities, and community colleges 
  6.14  unless approved for coverage by the board of regents or the 
  6.15  board of trustees of the Minnesota state colleges and 
  6.16  universities, as the case may be; 
  6.17     (3) (2) employees who are eligible for membership in the 
  6.18  state teachers retirement association except employees of the 
  6.19  department of children, families, and learning who have chosen 
  6.20  or may choose to be covered by the Minnesota state retirement 
  6.21  system instead of the teachers retirement association; 
  6.22     (4) (3) employees of the University of Minnesota who are 
  6.23  excluded from coverage by action of the board of regents; 
  6.24     (5) (4) officers and enlisted personnel in the national 
  6.25  guard and the naval militia who are assigned to permanent 
  6.26  peacetime duty and who under federal law are or are required to 
  6.27  be members of a federal retirement system; 
  6.28     (6) (5) election officers; 
  6.29     (7) (6) persons engaged in public work for the state but 
  6.30  employed by contractors when the performance of the contract is 
  6.31  authorized by the legislature or other competent authority; 
  6.32     (8) (7) officers and employees of the senate and house of 
  6.33  representatives or a legislative committee or commission who are 
  6.34  temporarily employed; 
  6.35     (9) (8) receivers, jurors, notaries public, and court 
  6.36  employees who are not in the judicial branch as defined in 
  7.1   section 43A.02, subdivision 25, except referees and adjusters 
  7.2   employed by the department of labor and industry; 
  7.3      (10) (9) patient and inmate help in state charitable, 
  7.4   penal, and correctional institutions including the Minnesota 
  7.5   veterans home; 
  7.6      (11) (10) persons employed for professional services where 
  7.7   the service is incidental to regular professional duties and 
  7.8   whose compensation is paid on a per diem basis; 
  7.9      (12) (11) employees of the Sibley House Association; 
  7.10     (13) (12) the members of any state board or commission who 
  7.11  serve the state intermittently and are paid on a per diem basis; 
  7.12  the secretary, secretary-treasurer, and treasurer of those 
  7.13  boards if their compensation is $5,000 or less per year, or, if 
  7.14  they are legally prohibited from serving more than three years; 
  7.15  and the board of managers of the state agricultural society and 
  7.16  its treasurer unless the treasurer is also its full-time 
  7.17  secretary; 
  7.18     (14) (13) state troopers; 
  7.19     (15) (14) temporary employees of the Minnesota state fair 
  7.20  employed on or after July 1 for a period not to extend beyond 
  7.21  October 15 of that year; and persons employed at any time by the 
  7.22  state fair administration for special events held on the 
  7.23  fairgrounds; 
  7.24     (16) (15) emergency employees in the classified service; 
  7.25  except that if an emergency employee, within the same pay 
  7.26  period, becomes a provisional or probationary employee on other 
  7.27  than a temporary basis, the employee shall be considered a 
  7.28  "state employee" retroactively to the beginning of the pay 
  7.29  period; 
  7.30     (17) (16) persons described in section 352B.01, subdivision 
  7.31  2, clauses (2) to (5); 
  7.32     (18) (17) temporary employees in the classified service, 
  7.33  and temporary employees in the unclassified service appointed 
  7.34  for a definite period of not more than six months and employed 
  7.35  less than six months in any one-year period; 
  7.36     (19) (18) trainee employees, except those listed in 
  8.1   subdivision 2a, clause (10); 
  8.2      (20) (19) persons whose compensation is paid on a fee 
  8.3   basis; 
  8.4      (21) (20) state employees who are employed by the board of 
  8.5   trustees of the Minnesota state colleges and universities in 
  8.6   unclassified positions enumerated in section 43A.08, subdivision 
  8.7   1, clause (9); 
  8.8      (21) state employees who in any year have credit for 12 
  8.9   months service as teachers in the public schools of the state 
  8.10  and as teachers are members of the teachers retirement 
  8.11  association or a retirement system in St. Paul, Minneapolis, or 
  8.12  Duluth; 
  8.13     (22) employees of the adjutant general employed on an 
  8.14  unlimited intermittent or temporary basis in the classified and 
  8.15  unclassified service for the support of army and air national 
  8.16  guard training facilities; 
  8.17     (23) chaplains and nuns who are excluded from coverage 
  8.18  under the federal Old Age, Survivors, Disability, and Health 
  8.19  Insurance Program for the performance of service as specified in 
  8.20  United States Code, title 42, section 410(a)(8)(A), as amended, 
  8.21  if no irrevocable election of coverage has been made under 
  8.22  section 3121(r) of the Internal Revenue Code of 1986, as amended 
  8.23  through December 31, 1992; 
  8.24     (24) examination monitors employed by departments, 
  8.25  agencies, commissions, and boards to conduct examinations 
  8.26  required by law; 
  8.27     (25) persons appointed to serve as members of fact-finding 
  8.28  commissions or adjustment panels, arbitrators, or labor referees 
  8.29  under chapter 179; 
  8.30     (26) temporary employees employed for limited periods under 
  8.31  any state or federal program for training or rehabilitation 
  8.32  including persons employed for limited periods from areas of 
  8.33  economic distress except skilled and supervisory personnel and 
  8.34  persons having civil service status covered by the system; 
  8.35     (27) full-time students employed by the Minnesota 
  8.36  historical society intermittently during part of the year and 
  9.1   full-time during the summer months; 
  9.2      (28) temporary employees, appointed for not more than six 
  9.3   months, of the metropolitan council and of any of its statutory 
  9.4   boards, if the board members are appointed by the metropolitan 
  9.5   council; 
  9.6      (29) persons employed in positions designated by the 
  9.7   department of employee relations as student workers; 
  9.8      (30) members of trades employed by the successor to the 
  9.9   metropolitan waste control commission with trade union pension 
  9.10  plan coverage under a collective bargaining agreement first 
  9.11  employed after June 1, 1977; 
  9.12     (31) persons employed in subsidized on-the-job training, 
  9.13  work experience, or public service employment as enrollees under 
  9.14  the federal Comprehensive Employment and Training Act after 
  9.15  March 30, 1978, unless the person has as of the later of March 
  9.16  30, 1978, or the date of employment sufficient service credit in 
  9.17  the retirement system to meet the minimum vesting requirements 
  9.18  for a deferred annuity, or the employer agrees in writing on 
  9.19  forms prescribed by the director to make the required employer 
  9.20  contributions, including any employer additional contributions, 
  9.21  on account of that person from revenue sources other than funds 
  9.22  provided under the federal Comprehensive Employment and Training 
  9.23  Act, or the person agrees in writing on forms prescribed by the 
  9.24  director to make the required employer contribution in addition 
  9.25  to the required employee contribution; 
  9.26     (32) off-duty peace officers while employed by the 
  9.27  metropolitan council; 
  9.28     (33) persons who are employed as full-time police officers 
  9.29  by the metropolitan council and as police officers are members 
  9.30  of the public employees police and fire fund; 
  9.31     (34) persons who are employed as full-time firefighters by 
  9.32  the department of military affairs and as firefighters are 
  9.33  members of the public employees police and fire fund; 
  9.34     (35) foreign citizens with a work permit of less than three 
  9.35  years, or an H-1b/JV visa valid for less than three years of 
  9.36  employment, unless notice of extension is supplied which allows 
 10.1   them to work for three or more years as of the date the 
 10.2   extension is granted, in which case they are eligible for 
 10.3   coverage from the date extended; and 
 10.4      (36) persons who are employed by the board of trustees of 
 10.5   the Minnesota state colleges and universities and who elect to 
 10.6   remain members of the public employees retirement association or 
 10.7   the Minneapolis employees retirement fund, whichever applies, 
 10.8   under section 136C.75.  
 10.9      Sec. 6.  Minnesota Statutes 2000, section 352.113, 
 10.10  subdivision 4, is amended to read: 
 10.11     Subd. 4.  [MEDICAL OR PSYCHOLOGICAL EXAMINATIONS; 
 10.12  AUTHORIZATION FOR PAYMENT OF BENEFIT.] An applicant shall 
 10.13  provide medical or psychological evidence to support an 
 10.14  application for total and permanent disability.  The director 
 10.15  shall have the employee examined by at least one additional 
 10.16  licensed chiropractor, physician, or psychologist designated by 
 10.17  the medical adviser.  The chiropractors, physicians, or 
 10.18  psychologists shall make written reports to the director 
 10.19  concerning the employee's disability including medical opinions 
 10.20  as to whether the employee is permanently and totally disabled 
 10.21  within the meaning of section 352.01, subdivision 17.  The 
 10.22  director shall also obtain written certification from the 
 10.23  employer stating whether the employment has ceased or whether 
 10.24  the employee is on sick leave of absence because of a disability 
 10.25  that will prevent further service to the employer and as a 
 10.26  consequence the employee is not entitled to compensation from 
 10.27  the employer.  The medical adviser shall consider the reports of 
 10.28  the physicians, psychologists, and chiropractors and any other 
 10.29  evidence supplied by the employee or other interested parties.  
 10.30  If the medical adviser finds the employee totally and 
 10.31  permanently disabled, the adviser shall make appropriate 
 10.32  recommendation to the director in writing together with the date 
 10.33  from which the employee has been totally disabled.  The director 
 10.34  shall then determine if the disability occurred within 180 days 
 10.35  of filing the application, while still in the employment of the 
 10.36  state, and the propriety of authorizing payment of a disability 
 11.1   benefit as provided in this section.  A terminated employee may 
 11.2   apply for a disability benefit within 180 days of termination as 
 11.3   long as the disability occurred while in the employment of the 
 11.4   state.  The fact that an employee is placed on leave of absence 
 11.5   without compensation because of disability does not bar that 
 11.6   employee from receiving a disability benefit.  Unless payment of 
 11.7   a disability benefit has terminated because the employee is no 
 11.8   longer totally disabled, or because the employee has reached 
 11.9   normal retirement age as provided in this section, the 
 11.10  disability benefit shall cease with the last payment received by 
 11.11  the disabled employee or which had accrued during the lifetime 
 11.12  of the employee unless there is a spouse surviving; in that 
 11.13  event the surviving spouse is entitled to the disability benefit 
 11.14  for the calendar month in which the disabled employee died. 
 11.15     Sec. 7.  Minnesota Statutes 2000, section 352.113, 
 11.16  subdivision 6, is amended to read: 
 11.17     Subd. 6.  [REGULAR MEDICAL OR PSYCHOLOGICAL EXAMINATIONS.] 
 11.18  At least once each year during the first five years following 
 11.19  the allowance of a disability benefit to any employee, and at 
 11.20  least once in every three-year period thereafter, the director 
 11.21  may require any disabled employee to undergo a medical or 
 11.22  psychological examination.  The examination must be made at the 
 11.23  place of residence of the employee, or at any place mutually 
 11.24  agreed upon, by a physician or physicians designated by the 
 11.25  medical adviser and engaged by the director.  If any examination 
 11.26  indicates to the medical adviser that the employee is no longer 
 11.27  permanently and totally disabled, or is engaged in or can engage 
 11.28  in a gainful occupation, payments of the disability benefit by 
 11.29  the fund must be discontinued.  The payments shall discontinue 
 11.30  as soon as the employee is reinstated to the payroll following 
 11.31  sick leave, but in no case shall payment be made for more than 
 11.32  60 days after the medical adviser finds that the employee is no 
 11.33  longer permanently and totally disabled. 
 11.34     Sec. 8.  Minnesota Statutes 2000, section 352.22, 
 11.35  subdivision 8, is amended to read: 
 11.36     Subd. 8.  [REFUND SPECIFICALLY LIMITED.] If a former 
 12.1   employee covered by the system does not apply for refund within 
 12.2   five years after the last deduction was taken from salary for 
 12.3   the retirement fund, and does not have enough service to qualify 
 12.4   for a deferred annuity, accumulated contributions must be 
 12.5   credited to and become a part of the retirement fund.  If the 
 12.6   former employee returns to state service and becomes a state 
 12.7   employee covered by the system, the amount credited to the 
 12.8   retirement fund, if more than $2 $25, shall be restored to the 
 12.9   individual account.  If the amount credited to the fund is over 
 12.10  $2 $25 and the former employee applies for refund or an annuity 
 12.11  under section 352.72, the amount must be restored to the former 
 12.12  employee's individual account and refund made or annuity paid 
 12.13  whichever applies. 
 12.14     Sec. 9.  Minnesota Statutes 2000, section 352.87, 
 12.15  subdivision 4, is amended to read: 
 12.16     Subd. 4.  [NON-JOB-RELATED DISABILITY BENEFITS.] An 
 12.17  eligible member described in subdivision 1, who is less than 55 
 12.18  years of age and who becomes disabled and physically or mentally 
 12.19  unfit to perform the duties of the position because of sickness 
 12.20  or injury while not engaged in covered employment, is entitled 
 12.21  to a disability benefit amount equivalent to an annuity computed 
 12.22  under subdivision 3 assuming the member has 15 years of service 
 12.23  qualifying under this section and waiving the minimum age 
 12.24  requirement.  If the eligible member becomes disabled under this 
 12.25  subdivision with more than 15 years of service covered under 
 12.26  this section, the eligible member is entitled to a disability 
 12.27  benefit amount equivalent to an annuity computed under 
 12.28  subdivision 3 based on all years of service credited under this 
 12.29  section and waiving the minimum age requirement. 
 12.30     Sec. 10.  Minnesota Statutes 2000, section 352.87, 
 12.31  subdivision 5, is amended to read: 
 12.32     Subd. 5.  [JOB-RELATED DISABILITY BENEFITS.] An eligible 
 12.33  member defined in subdivision 1, who is less than 55 years of 
 12.34  age and who becomes disabled and physically or mentally unfit to 
 12.35  perform the duties of the position because of sickness or injury 
 12.36  while engaged in covered employment, is entitled to a disability 
 13.1   benefit amount equivalent to an annuity computed under 
 13.2   subdivision 3 assuming the member has 20 years of service 
 13.3   qualifying under this section and waiving the minimum age 
 13.4   requirement.  An eligible member who becomes disabled under this 
 13.5   subdivision with more than 20 years of service credited under 
 13.6   this section is entitled to a disability benefit amount 
 13.7   equivalent to an annuity computed under subdivision 3 based on 
 13.8   all years of service credited under this section and waiving the 
 13.9   age requirement. 
 13.10     Sec. 11.  Minnesota Statutes 2000, section 352.95, 
 13.11  subdivision 4, is amended to read: 
 13.12     Subd. 4.  [MEDICAL OR PSYCHOLOGICAL EVIDENCE.] (a) An 
 13.13  applicant shall provide medical or psychological evidence to 
 13.14  support an application for disability benefits.  The director 
 13.15  shall have the employee examined by at least one additional 
 13.16  licensed physician or psychologist designated by the medical 
 13.17  adviser.  The physicians shall make written reports to the 
 13.18  director concerning the employee's disability, including medical 
 13.19  opinions as to whether the employee is disabled within the 
 13.20  meaning of this section.  The director shall also obtain written 
 13.21  certification from the employer stating whether the employee is 
 13.22  on sick leave of absence because of a disability that will 
 13.23  prevent further service to the employer, and as a consequence 
 13.24  the employee is not entitled to compensation from the employer.  
 13.25     (b) If on considering the physicians' reports and any other 
 13.26  evidence supplied by the employee or others, the medical adviser 
 13.27  finds the employee disabled within the meaning of this section, 
 13.28  the advisor shall make appropriate recommendation to the 
 13.29  director in writing, together with the date from which the 
 13.30  employee has been disabled.  The director shall then determine 
 13.31  the propriety of authorizing payment of a disability benefit as 
 13.32  provided in this section.  
 13.33     (c) Unless payment of a disability benefit has terminated 
 13.34  because the employee is no longer disabled, or because the 
 13.35  employee has reached age 62 65 or the five-year anniversary of 
 13.36  the effective date of the disability benefit, whichever is 
 14.1   later, the disability benefit shall cease with the last payment 
 14.2   received by the disabled employee or which had accrued during 
 14.3   the employee's lifetime.  While disability benefits are paid, 
 14.4   the director has the right at reasonable times to require the 
 14.5   disabled employee to submit proof of the continuance of the 
 14.6   disability claimed.  If any examination indicates to the medical 
 14.7   adviser that the employee is no longer disabled, the disability 
 14.8   payment must be discontinued upon reinstatement to state service 
 14.9   or within 60 days of the finding, whichever is sooner.  
 14.10     Sec. 12.  Minnesota Statutes 2000, section 352.95, 
 14.11  subdivision 5, is amended to read: 
 14.12     Subd. 5.  [RETIREMENT STATUS AT NORMAL RETIREMENT AGE.] The 
 14.13  disability benefit paid to a disabled correctional employee 
 14.14  under this section shall terminate at the end of the month in 
 14.15  which the employee reaches age 62 65, or the five-year 
 14.16  anniversary of the effective date of the disability benefit, 
 14.17  whichever is later.  If the disabled correctional employee is 
 14.18  still disabled when the employee reaches age 62 65, or the 
 14.19  five-year anniversary of the effective date of the disability 
 14.20  benefit, whichever is later, the employee shall be deemed to be 
 14.21  a retired employee.  If the employee had elected an optional 
 14.22  annuity under subdivision 1a, the employee shall receive an 
 14.23  annuity in accordance with the terms of the optional annuity 
 14.24  previously elected.  If the employee had not elected an optional 
 14.25  annuity under subdivision 1a, the employee may within 90 days of 
 14.26  attaining age 65 or reaching the five-year anniversary of the 
 14.27  effective date of the disability benefit, whichever is later, 
 14.28  either elect to receive a normal retirement annuity computed in 
 14.29  the manner provided in section 352.93 or elect to receive an 
 14.30  optional annuity as provided in section 352.116, subdivision 3, 
 14.31  based on the same length of service as used in the calculation 
 14.32  of the disability benefit.  Election of an optional annuity must 
 14.33  be made within 90 days before attaining age 65 or reaching the 
 14.34  five-year anniversary of the effective date of the disability 
 14.35  benefit, whichever is later.  If an optional annuity is elected, 
 14.36  the optional annuity shall begin to accrue on the first of the 
 15.1   month following the month in which the employee reaches age 65 
 15.2   or the five-year anniversary of the effective date of the 
 15.3   disability benefit, whichever is later. 
 15.4      Sec. 13.  Minnesota Statutes 2000, section 352.95, 
 15.5   subdivision 7, is amended to read: 
 15.6      Subd. 7.  [RESUMPTION OF EMPLOYMENT.] If the disabled 
 15.7   employee resumes a gainful occupation from which earnings are 
 15.8   less than the salary received at the date of disability or the 
 15.9   salary currently paid for similar positions, or if the employee 
 15.10  is entitled to receive workers' compensation benefits work, the 
 15.11  disability benefit must be continued in an amount which when 
 15.12  added to current earnings and workers' compensation benefits 
 15.13  does not exceed the salary received at the date of disability or 
 15.14  the salary currently paid for similar positions, whichever is 
 15.15  higher, if the disability benefit in that case does not exceed 
 15.16  the disability benefit originally authorized and in effect rate 
 15.17  at the date of disability as adjusted by the same percentage 
 15.18  increase in United States average wages used by social security 
 15.19  in calculating average indexed monthly earnings. 
 15.20     Sec. 14.  Minnesota Statutes 2000, section 352B.01, 
 15.21  subdivision 11, is amended to read: 
 15.22     Subd. 11.  [AVERAGE MONTHLY SALARY.] "Average monthly 
 15.23  salary" means the average of the highest monthly salaries for 
 15.24  five years of service as a member.  Average monthly salary must 
 15.25  be based upon all allowable service if this service is less than 
 15.26  five years.  It does not include any lump sum annual leave 
 15.27  payments and overtime payments made at the time of separation 
 15.28  from state service, any amounts of severance pay, or any reduced 
 15.29  salary paid during the period the person is entitled to workers' 
 15.30  compensation benefit payments for temporary disability.  A 
 15.31  member on leave of absence receiving temporary workers' 
 15.32  compensation payments and a reduced salary or no salary from the 
 15.33  employer who is entitled to allowable service credit for the 
 15.34  period of absence may make payment to the fund for the 
 15.35  difference between salary received, if any, and the salary the 
 15.36  member would normally receive if not on leave of absence during 
 16.1   the period.  The member shall pay an amount equal to the member 
 16.2   and employer contribution rate under section 352B.02, 
 16.3   subdivisions 1b and 1c, on the differential salary amount for 
 16.4   the period of the leave of absence.  The employing department, 
 16.5   at its option, may pay the employer amount on behalf of the 
 16.6   member.  Payment made under this subdivision must include 
 16.7   interest at the rate of 8.5 percent per year, and must be 
 16.8   completed within one year of the return from the leave of 
 16.9   absence. 
 16.10     Sec. 15.  Minnesota Statutes 2000, section 352B.10, 
 16.11  subdivision 3, is amended to read: 
 16.12     Subd. 3.  [ANNUAL AND SICK LEAVE; WORK AT LOWER PAY.] No 
 16.13  member shall receive any disability benefit payment when the 
 16.14  member has unused annual leave or sick leave or under any other 
 16.15  circumstances, when during the period of disability there has 
 16.16  been no impairment of salary.  Should the member or former 
 16.17  member resume gainful work and earn less than the salary 
 16.18  received at the date of disability or the salary currently paid 
 16.19  for similar positions, the disability benefit must be continued 
 16.20  in an amount which when added to current earnings does not 
 16.21  exceed the salary rate received at the date of disability or the 
 16.22  salary currently paid for similar positions, whichever is 
 16.23  higher.  The disability benefit must not exceed the disability 
 16.24  benefit originally allowed as adjusted by the same percentage 
 16.25  increase in United States average wages used by social security 
 16.26  in calculating average indexed monthly earnings. 
 16.27     Sec. 16.  Minnesota Statutes 2000, section 352B.101, is 
 16.28  amended to read: 
 16.29     352B.101 [APPLICATION FOR DISABILITY BENEFIT.] 
 16.30     A member claiming a disability benefit must file a written 
 16.31  application for benefits in the office of the system in a form 
 16.32  and manner prescribed by the executive director.  The member 
 16.33  shall provide medical or psychological evidence to support the 
 16.34  application.  The benefit begins to accrue the day following the 
 16.35  start of disability or the day following the last day for which 
 16.36  the member was paid, whichever is later, but not earlier than 
 17.1   180 days before the date the application is filed with the 
 17.2   executive director. 
 17.3      Sec. 17.  Minnesota Statutes 2000, section 354.05, 
 17.4   subdivision 2, is amended to read: 
 17.5      Subd. 2.  [TEACHER.] (a) "Teacher" means: 
 17.6      (1) a person who renders service as a teacher, supervisor, 
 17.7   principal, superintendent, librarian, nurse, counselor, social 
 17.8   worker, therapist, or psychologist in the public schools of the 
 17.9   state located outside of the corporate limits of the cities of 
 17.10  the first class or in the Minnesota state colleges and 
 17.11  universities system, or in any charitable, penal, or 
 17.12  correctional institutions of a governmental subdivision, or who 
 17.13  is engaged in educational administration in connection with the 
 17.14  state public school system, including the Minnesota state 
 17.15  colleges and universities system, but excluding the University 
 17.16  of Minnesota, whether the position be a public office or an 
 17.17  employment, not including members or officers of any general 
 17.18  governing or managing board or body; 
 17.19     (2) an employee of the teachers retirement association 
 17.20  unless the employee is covered by the Minnesota state retirement 
 17.21  system due to prior employment by that system; 
 17.22     (3) a person who renders teaching service on a part-time 
 17.23  basis and who also renders other services for a single employing 
 17.24  unit.  A person whose teaching service comprises at least 50 
 17.25  percent of the combined employment salary is a member of the 
 17.26  association for all services with the single employing unit.  If 
 17.27  the person's teaching service comprises less than 50 percent of 
 17.28  the combined employment salary, the executive director must 
 17.29  determine whether all or none of the combined service is covered 
 17.30  by the association; or 
 17.31     (4) a person not covered by the plans established under 
 17.32  chapter 352D, 354A, or 354B and who is employed by the board of 
 17.33  trustees of the Minnesota state colleges and universities system 
 17.34  in an unclassified position as a: 
 17.35     (i) president, vice-president, or dean; 
 17.36     (ii) other manager or professional in an academic or 
 18.1   academic support program; 
 18.2      (iii) administrative or service support faculty; or 
 18.3      (iv) teacher or research assistant. 
 18.4      (b) Teacher does not mean: 
 18.5      (1) a person who works for a school or institution as an 
 18.6   independent contractor as defined by the Internal Revenue 
 18.7   Service; 
 18.8      (2) a person employed in subsidized on-the-job training, 
 18.9   work experience or public service employment as an enrollee 
 18.10  under the federal Comprehensive Employment and Training Act from 
 18.11  and after March 30, 1978, unless the person has, as of the later 
 18.12  of March 30, 1978, or the date of employment, sufficient service 
 18.13  credit in the retirement association to meet the minimum vesting 
 18.14  requirements for a deferred retirement annuity, or the employer 
 18.15  agrees in writing on forms prescribed by the executive director 
 18.16  to make the required employer contributions, including any 
 18.17  employer additional contributions, on account of that person 
 18.18  from revenue sources other than funds provided under the federal 
 18.19  Comprehensive Training and Employment Act, or the person agrees 
 18.20  in writing on forms prescribed by the executive director to make 
 18.21  the required employer contribution in addition to the required 
 18.22  employee contribution; 
 18.23     (3) a person holding a part-time adult supplementary 
 18.24  technical college license who renders part-time teaching service 
 18.25  or a customized trainer as defined by the Minnesota state 
 18.26  colleges and universities system in a technical college if (i) 
 18.27  the service is incidental to the regular nonteaching occupation 
 18.28  of the person; and (ii) the applicable technical college 
 18.29  stipulates annually in advance that the part-time teaching 
 18.30  service or customized training service will not exceed 300 hours 
 18.31  in a fiscal year and retains the stipulation in its records; and 
 18.32  (iii) the part-time teaching service or customized training 
 18.33  service actually does not exceed 300 hours in a fiscal year; or 
 18.34     (4) a person exempt from licensure under section 122A.30. 
 18.35     Sec. 18.  Minnesota Statutes 2000, section 354.52, 
 18.36  subdivision 4, is amended to read: 
 19.1      Subd. 4.  [REPORTING AND REMITTANCE REQUIREMENTS.] An 
 19.2   employer shall remit all amounts due to the association and 
 19.3   furnish a statement indicating the amount due and transmitted 
 19.4   with any other information required by the executive director.  
 19.5   If an amount due is not received by the association within seven 
 19.6   14 calendar days of the payroll warrant, the amount accrues 
 19.7   interest at an annual rate of 8.5 percent compounded annually 
 19.8   from the due date until the amount is received by the 
 19.9   association.  All amounts due and other employer obligations not 
 19.10  remitted within 60 days of notification by the association must 
 19.11  be certified to the commissioner of finance who shall deduct the 
 19.12  amount from any state aid or appropriation amount applicable to 
 19.13  the employing unit. 
 19.14     Sec. 19.  Minnesota Statutes 2000, section 354A.011, 
 19.15  subdivision 24, is amended to read: 
 19.16     Subd. 24.  [SALARY; COVERED SALARY.] (a) "Salary" or 
 19.17  "covered salary" means the entire compensation, upon which 
 19.18  member contributions are required and made, that is paid to a 
 19.19  teacher before any allowable reductions permitted under the 
 19.20  federal Internal Revenue Code of 1986, as amended, for employee 
 19.21  selected fringe benefits, tax sheltered annuities, deferred 
 19.22  compensation, or any combination of these items deductions for 
 19.23  deferred compensation, supplemental retirement plans, or other 
 19.24  voluntary salary reduction programs. 
 19.25     (b) "Salary" does not mean: 
 19.26     (1) lump sum annual leave payments; 
 19.27     (2) lump sum wellness and sick leave payments; 
 19.28     (3) payments in lieu of any employer-paid group insurance 
 19.29  coverage employer-paid amounts used by an employee toward the 
 19.30  cost of insurance coverage, employer-paid fringe benefits, 
 19.31  flexible spending accounts, cafeteria plans, health care expense 
 19.32  accounts, day care expenses, or any payments in lieu of any 
 19.33  employer-paid group insurance coverage, including the difference 
 19.34  between single and family rates that may be paid to a member 
 19.35  with single coverage and certain amounts determined by the 
 19.36  executive secretary or director to be ineligible; 
 20.1      (4) payments for the difference between single and family 
 20.2   premium rates that may be paid to a member with single 
 20.3   coverage any form of payment made in lieu of any other 
 20.4   employer-paid fringe benefit or expense; 
 20.5      (5) employer-paid fringe benefits including, but not 
 20.6   limited to, flexible spending accounts, cafeteria plans, health 
 20.7   care expense accounts, day care expenses, or automobile 
 20.8   allowances and expenses any form of severance payments; 
 20.9      (6) workers' compensation payments; 
 20.10     (7) disability insurance payments, including self-insured 
 20.11  disability payments; 
 20.12     (6) (8) payments to school principals and all other 
 20.13  administrators for services in addition to the normal work year 
 20.14  contract if these additional services are performed on an 
 20.15  extended duty day, Saturday, Sunday, holiday, annual leave day, 
 20.16  sick leave day, or any other nonduty day; 
 20.17     (7) (9) payments under section 356.24, subdivision 1, 
 20.18  clause (4)(ii); and 
 20.19     (8) (10) payments made under section 122A.40, subdivision 
 20.20  12, except for payments for sick leave accumulated under the 
 20.21  provisions of a uniform school district policy that applies 
 20.22  equally to all similarly situated persons in the district. 
 20.23     Sec. 20.  [354A.107] [PAYMENT ACCEPTANCE ALLOWED.] 
 20.24     Payment for allowable service credit or repayment of a 
 20.25  prior refund or payment for an eligible leave of absence by a 
 20.26  member of the Minneapolis teachers retirement fund association, 
 20.27  the St. Paul teachers retirement fund association, or the Duluth 
 20.28  teachers retirement fund association, may be made with funds 
 20.29  distributed from a plan qualified under section 401(a), 401(k), 
 20.30  403(a), 403(b), or 457(b) of the federal Internal Revenue Code 
 20.31  of 1986, as amended from time to time, or funds distributed from 
 20.32  an individual retirement account used solely in a manner 
 20.33  eligible for treatment as a nontaxable rollover under applicable 
 20.34  law.  The rollover must be separately accounted for as member 
 20.35  contributions not previously taxed.  Before accepting any 
 20.36  transfers to which this section applies, the executive secretary 
 21.1   or director must require the member to provide written 
 21.2   documentation that the amounts to be transferred are eligible 
 21.3   for tax free rollover and qualify for that treatment under the 
 21.4   federal Internal Revenue Code of 1986, as amended. 
 21.5      Sec. 21.  [354A.108] [PAYMENT BY TEACHERS COLLECTING 
 21.6   WORKERS' COMPENSATION.] 
 21.7      (a) A member of the Duluth teachers retirement fund 
 21.8   association who is receiving temporary workers' compensation 
 21.9   payments related to the member's teaching service and who either 
 21.10  is receiving a reduced salary from the employer or is receiving 
 21.11  no salary from the employer is entitled to purchase allowable 
 21.12  service credit for the period of time that the member is 
 21.13  receiving the workers' compensation payments.  
 21.14     (b) The required amount payable by the member must be 
 21.15  calculated first by determining the differential salary amount, 
 21.16  which is the difference between the salary received, if any, 
 21.17  during the period of time that the member is collecting workers' 
 21.18  compensation payments, and the salary that the member received 
 21.19  for an identical length period immediately before collecting the 
 21.20  workers' compensation payments.  The member shall pay an amount 
 21.21  equal to the employee contribution rate under section 354A.12, 
 21.22  subdivision 1, multiplied by the differential salary amount.  
 21.23     (c) If the member makes the employee payment under this 
 21.24  section, the employing unit shall make an employer payment to 
 21.25  the Duluth teachers retirement fund association equal to the 
 21.26  employer contribution rate under section 354A.12, subdivision 
 21.27  2a, multiplied by the differential salary amount.  
 21.28     (d) Payments made under this subdivision are payable 
 21.29  without interest if paid by June 30 of the year during which the 
 21.30  workers' compensation payments are received by the member.  If 
 21.31  paid after June 30, payments made under this subdivision must 
 21.32  include interest at the rate of 8.5 percent per year.  Payment 
 21.33  under this section must be completed within one year of the 
 21.34  termination of the workers' compensation payments to the member. 
 21.35     Sec. 22.  Minnesota Statutes 2000, section 354A.12, 
 21.36  subdivision 5, is amended to read: 
 22.1      Subd. 5.  [EMPLOYEE REPORTING AND REMITTANCE REQUIREMENTS.] 
 22.2   (a) Each school district employing unit shall provide to the 
 22.3   appropriate teachers retirement fund association information the 
 22.4   following member data regarding all new or returning 
 22.5   employees on a form provided by the executive secretary or 
 22.6   director before the employee's first payroll date. in a format 
 22.7   approved by the executive secretary or director.  Data changes 
 22.8   and the dates of those changes must be reported to the 
 22.9   association on an ongoing basis for the payroll cycle in which 
 22.10  they occur.  Data on the member includes: 
 22.11     (1) legal name, address, date of birth, association member 
 22.12  number, employer-assigned employee number, and social security 
 22.13  number; 
 22.14     (2) association status, including, but not limited to, 
 22.15  basic, coordinated, exempt annuitant, exempt technical college 
 22.16  teacher, and exempt independent contractor or consultant; 
 22.17     (3) employment status, including, but not limited to, full 
 22.18  time, part time, intermittent, substitute, or part-time 
 22.19  mobility; 
 22.20     (4) employment position, including, but not limited to, 
 22.21  teacher, superintendent, principal, administrator, or other; 
 22.22     (5) employment activity, including, but not limited to, 
 22.23  hire, termination, resumption of employment, disability, or 
 22.24  death; 
 22.25     (6) leaves of absence; and 
 22.26     (7) other information as may be required by the association.
 22.27     (b) Each employing unit shall provide the following data to 
 22.28  the appropriate association for each payroll cycle in a format 
 22.29  approved by the executive secretary or director: 
 22.30     (1) association member number; 
 22.31     (2) employer-assigned employee number; 
 22.32     (3) social security number; 
 22.33     (4) amount of each salary deduction; 
 22.34     (5) amount of salary as defined in section 354A.011, 
 22.35  subdivision 24, from which each deduction was made; 
 22.36     (6) reason for payment; 
 23.1      (7) service credit; 
 23.2      (8) the beginning and ending dates of the payroll period 
 23.3   covered and the date of actual payment; 
 23.4      (9) fiscal year of salary earnings; 
 23.5      (10) total remittance amount including employee, employer, 
 23.6   and employer additional contributions; and 
 23.7      (11) other information as may be required by the 
 23.8   association. 
 23.9      (c) On or before August 1 each year, each employing unit 
 23.10  must report to the appropriate association giving an itemized 
 23.11  summary for the preceding 12 months of the total amount withheld 
 23.12  from the salaries of teachers for deductions and all other 
 23.13  information required by the association. 
 23.14     (d) An employing unit that does not comply with the 
 23.15  reporting requirements under this section shall pay a fine of $5 
 23.16  per calendar day until the association receives the required 
 23.17  member data. 
 23.18     (e) An employing unit shall remit all amounts due to the 
 23.19  association and shall furnish for each pay period an itemized 
 23.20  statement indicating the total amount due and transmitted with 
 23.21  any other information required by the association.  All amounts 
 23.22  due and other employer obligations not remitted within 30 days 
 23.23  of notification by the association must be certified to the 
 23.24  commissioner of finance who shall deduct the amount from any 
 23.25  state aid or appropriation amount applicable to the employing 
 23.26  unit. 
 23.27     Sec. 23.  Minnesota Statutes 2000, section 354A.31, 
 23.28  subdivision 3, is amended to read: 
 23.29     Subd. 3.  [RESUMPTION OF TEACHING AFTER COMMENCEMENT OF A 
 23.30  RETIREMENT ANNUITY.] (a) Any person who retired and is receiving 
 23.31  a coordinated program retirement annuity under the provisions of 
 23.32  sections 354A.31 to 354A.41 or any person receiving a basic 
 23.33  program retirement annuity under the governing sections in the 
 23.34  articles of incorporation or bylaws and who has resumed teaching 
 23.35  service for the school district in which the teachers retirement 
 23.36  fund association exists is entitled to continue to receive 
 24.1   retirement annuity payments, except that annuity payments must 
 24.2   be reduced during the calendar year immediately following the 
 24.3   calendar year in which the person's income from the teaching 
 24.4   service is in an amount greater than the annual maximum earnings 
 24.5   allowable for that age for the continued receipt of full benefit 
 24.6   amounts monthly under the federal old age, survivors, and 
 24.7   disability insurance program as set by the secretary of health 
 24.8   and human services under United States Code, title 42, section 
 24.9   403.  The amount of the reduction must be one-third the amount 
 24.10  in excess of the applicable reemployment income maximum 
 24.11  specified in this subdivision and must be deducted from the 
 24.12  annuity payable for the calendar year immediately following the 
 24.13  calendar year in which the excess amount was earned.  If the 
 24.14  person has not yet reached the minimum age for the receipt of 
 24.15  social security benefits, the maximum earnings for the person 
 24.16  must be equal to the annual maximum earnings allowable for the 
 24.17  minimum age for the receipt of social security benefits. 
 24.18     (b) If the person is retired for only a fractional part of 
 24.19  the calendar year during the initial year of retirement, the 
 24.20  maximum reemployment income specified in this subdivision must 
 24.21  be prorated for that calendar year. 
 24.22     (c) After a person has reached the age of 70, no 
 24.23  reemployment income maximum is applicable regardless of the 
 24.24  amount of any compensation received for teaching service for the 
 24.25  school district in which the teachers retirement fund 
 24.26  association exists.  
 24.27     (d) The amount of the retirement annuity reduction must be 
 24.28  handled or disposed of as provided in section 356.58. 
 24.29     (e) For the purpose of this subdivision, income from 
 24.30  teaching service includes:  (i) all income for services 
 24.31  performed as a consultant or independent contractor; or income 
 24.32  resulting from working with the school district in any capacity; 
 24.33  and (ii) the greater of either the income received or an amount 
 24.34  based on the rate paid with respect to an administrative 
 24.35  position, consultant, or independent contractor in the school 
 24.36  district in which the teachers retirement fund association 
 25.1   exists and at the same level as the position occupied by the 
 25.2   person who resumes teaching service. 
 25.3      (f) On or before February 15 of each year, each employing 
 25.4   unit shall report to the teachers retirement fund association 
 25.5   the amount of postretirement income as defined in this section, 
 25.6   earned as a teacher, consultant, or independent contractor 
 25.7   during the previous calendar year by each retiree of a teachers 
 25.8   retirement fund association for teaching service performed after 
 25.9   retirement.  The report shall be in a format approved by the 
 25.10  executive secretary or director. 
 25.11     Sec. 24.  Minnesota Statutes 2000, section 354A.35, 
 25.12  subdivision 4, is amended to read: 
 25.13     Subd. 4.  [PAYMENT OF MINIMAL REFUND AND BENEFIT AMOUNTS.] 
 25.14  If a coordinated member or former coordinated member dies 
 25.15  without having designated a beneficiary or if the designated 
 25.16  beneficiary dies without there existing any other designated 
 25.17  beneficiary and prior to making application for the refund 
 25.18  credited to the deceased coordinated member or coordinated 
 25.19  former member, and if the amount of the refund does not 
 25.20  exceed $500 $1,500, the board in its discretion may, in absence 
 25.21  of probate proceedings, make payment 90 days after the date of 
 25.22  death of the coordinated member or former coordinated member to 
 25.23  the surviving spouse of the deceased coordinated member or 
 25.24  former coordinated member, or if none, to the next of kin as 
 25.25  determined under the laws of descent of the state.  A payment 
 25.26  under this subdivision shall be a bar to recovery by any other 
 25.27  person or persons.  Any retirement annuity in any amount which 
 25.28  has accrued at the time of the death of a coordinated retiree 
 25.29  may be paid by the board in its discretion using the procedure 
 25.30  set forth in this subdivision.  
 25.31     Sec. 25.  Minnesota Statutes 2000, section 356A.06, 
 25.32  subdivision 5, is amended to read: 
 25.33     Subd. 5.  [INVESTMENT BUSINESS RECIPIENT DISCLOSURE.] The 
 25.34  chief administrative officer of a covered pension plan, with 
 25.35  respect to investments made by the plan, and the executive 
 25.36  director of the state board of investment, with respect to 
 26.1   investments of plan assets made by the board, shall annually 
 26.2   disclose in writing the recipients of investment business placed 
 26.3   with or investment commissions allocated among commercial banks, 
 26.4   investment bankers, brokerage organizations, or other investment 
 26.5   managers.  The disclosure document must be prepared within 60 
 26.6   days after the close of the fiscal year of the plan and must be 
 26.7   available for public inspection during regular office hours at 
 26.8   the office of the plan.  The disclosure document must also be 
 26.9   filed with the executive director of the legislative commission 
 26.10  on pensions and retirement within 90 days after the close of the 
 26.11  fiscal year of the plan.  For the state board of investment and 
 26.12  a first class city teacher pension fund, a disclosure document 
 26.13  included as part of a regular annual report of the board or the 
 26.14  first class city teacher pension fund when filed with the 
 26.15  executive director of the legislative commission on pensions and 
 26.16  retirement is considered to have been filed on a timely basis. 
 26.17     Sec. 26.  Minnesota Statutes 2000, section 490.121, 
 26.18  subdivision 4, is amended to read: 
 26.19     Subd. 4.  [ALLOWABLE SERVICE.] "Allowable service" means a 
 26.20  whole year, or any fraction thereof any calendar month, subject 
 26.21  to the service credit limit in subdivision 22, served as a judge 
 26.22  at any time, or served as a referee in probate for all referees 
 26.23  in probate who were in office prior to January 1, 1974. 
 26.24     Sec. 27.  [DELAYED EFFECTIVE DATE.] 
 26.25     Notwithstanding Laws 2000, chapter 461, article 10, section 
 26.26  3, the amendment to Minnesota Statutes, section 353E.03, made by 
 26.27  Laws 2000, chapter 461, article 10, section 2, is effective on 
 26.28  the first day of the first full pay period beginning after 
 26.29  January 1, 2003. 
 26.30     Sec. 28.  [REPEALER.] 
 26.31     Minnesota Statutes 2000, section 354A.026, is repealed. 
 26.32     Sec. 29.  [EFFECTIVE DATE.] 
 26.33     (a) Sections 1 to 20, 22 to 26, and 28 are effective on 
 26.34  July 1, 2001. 
 26.35     (b) Section 21 is effective on May 1, 2001. 
 26.36                             ARTICLE 2 
 27.1          STATE PATROL RETIREMENT PLAN MEMBERSHIP EXPANSION
 27.2      Section 1.  Minnesota Statutes 2000, section 352.01, 
 27.3   subdivision 2b, is amended to read: 
 27.4      Subd. 2b.  [EXCLUDED EMPLOYEES.] "State employee" does not 
 27.5   include: 
 27.6      (1) elective state officers; 
 27.7      (2) students employed by the University of Minnesota, the 
 27.8   state universities, and community colleges unless approved for 
 27.9   coverage by the board of regents or the board of trustees of the 
 27.10  Minnesota state colleges and universities, as the case may be; 
 27.11     (3) employees who are eligible for membership in the state 
 27.12  teachers retirement association except employees of the 
 27.13  department of children, families, and learning who have chosen 
 27.14  or may choose to be covered by the Minnesota state retirement 
 27.15  system instead of the teachers retirement association; 
 27.16     (4) employees of the University of Minnesota who are 
 27.17  excluded from coverage by action of the board of regents; 
 27.18     (5) officers and enlisted personnel in the national guard 
 27.19  and the naval militia who are assigned to permanent peacetime 
 27.20  duty and who under federal law are or are required to be members 
 27.21  of a federal retirement system; 
 27.22     (6) election officers; 
 27.23     (7) persons engaged in public work for the state but 
 27.24  employed by contractors when the performance of the contract is 
 27.25  authorized by the legislature or other competent authority; 
 27.26     (8) officers and employees of the senate and house of 
 27.27  representatives or a legislative committee or commission who are 
 27.28  temporarily employed; 
 27.29     (9) receivers, jurors, notaries public, and court employees 
 27.30  who are not in the judicial branch as defined in section 43A.02, 
 27.31  subdivision 25, except referees and adjusters employed by the 
 27.32  department of labor and industry; 
 27.33     (10) patient and inmate help in state charitable, penal, 
 27.34  and correctional institutions including the Minnesota veterans 
 27.35  home; 
 27.36     (11) persons employed for professional services where the 
 28.1   service is incidental to regular professional duties and whose 
 28.2   compensation is paid on a per diem basis; 
 28.3      (12) employees of the Sibley House Association; 
 28.4      (13) the members of any state board or commission who serve 
 28.5   the state intermittently and are paid on a per diem basis; the 
 28.6   secretary, secretary-treasurer, and treasurer of those boards if 
 28.7   their compensation is $5,000 or less per year, or, if they are 
 28.8   legally prohibited from serving more than three years; and the 
 28.9   board of managers of the state agricultural society and its 
 28.10  treasurer unless the treasurer is also its full-time secretary; 
 28.11     (14) state troopers; 
 28.12     (15) temporary employees of the Minnesota state fair 
 28.13  employed on or after July 1 for a period not to extend beyond 
 28.14  October 15 of that year; and persons employed at any time by the 
 28.15  state fair administration for special events held on the 
 28.16  fairgrounds; 
 28.17     (16) emergency employees in the classified service; except 
 28.18  that if an emergency employee, within the same pay period, 
 28.19  becomes a provisional or probationary employee on other than a 
 28.20  temporary basis, the employee shall be considered a "state 
 28.21  employee" retroactively to the beginning of the pay period; 
 28.22     (17) persons described in section 352B.01, subdivision 2, 
 28.23  clauses (2) to (5) (6); 
 28.24     (18) temporary employees in the classified service, and 
 28.25  temporary employees in the unclassified service appointed for a 
 28.26  definite period of not more than six months and employed less 
 28.27  than six months in any one-year period; 
 28.28     (19) trainee employees, except those listed in subdivision 
 28.29  2a, clause (10); 
 28.30     (20) persons whose compensation is paid on a fee basis; 
 28.31     (21) state employees who in any year have credit for 12 
 28.32  months service as teachers in the public schools of the state 
 28.33  and as teachers are members of the teachers retirement 
 28.34  association or a retirement system in St. Paul, Minneapolis, or 
 28.35  Duluth; 
 28.36     (22) employees of the adjutant general employed on an 
 29.1   unlimited intermittent or temporary basis in the classified and 
 29.2   unclassified service for the support of army and air national 
 29.3   guard training facilities; 
 29.4      (23) chaplains and nuns who are excluded from coverage 
 29.5   under the federal Old Age, Survivors, Disability, and Health 
 29.6   Insurance Program for the performance of service as specified in 
 29.7   United States Code, title 42, section 410(a)(8)(A), as amended, 
 29.8   if no irrevocable election of coverage has been made under 
 29.9   section 3121(r) of the Internal Revenue Code of 1986, as amended 
 29.10  through December 31, 1992; 
 29.11     (24) examination monitors employed by departments, 
 29.12  agencies, commissions, and boards to conduct examinations 
 29.13  required by law; 
 29.14     (25) persons appointed to serve as members of fact-finding 
 29.15  commissions or adjustment panels, arbitrators, or labor referees 
 29.16  under chapter 179; 
 29.17     (26) temporary employees employed for limited periods under 
 29.18  any state or federal program for training or rehabilitation 
 29.19  including persons employed for limited periods from areas of 
 29.20  economic distress except skilled and supervisory personnel and 
 29.21  persons having civil service status covered by the system; 
 29.22     (27) full-time students employed by the Minnesota 
 29.23  historical society intermittently during part of the year and 
 29.24  full-time during the summer months; 
 29.25     (28) temporary employees, appointed for not more than six 
 29.26  months, of the metropolitan council and of any of its statutory 
 29.27  boards, if the board members are appointed by the metropolitan 
 29.28  council; 
 29.29     (29) persons employed in positions designated by the 
 29.30  department of employee relations as student workers; 
 29.31     (30) members of trades employed by the successor to the 
 29.32  metropolitan waste control commission with trade union pension 
 29.33  plan coverage under a collective bargaining agreement first 
 29.34  employed after June 1, 1977; 
 29.35     (31) persons employed in subsidized on-the-job training, 
 29.36  work experience, or public service employment as enrollees under 
 30.1   the federal Comprehensive Employment and Training Act after 
 30.2   March 30, 1978, unless the person has as of the later of March 
 30.3   30, 1978, or the date of employment sufficient service credit in 
 30.4   the retirement system to meet the minimum vesting requirements 
 30.5   for a deferred annuity, or the employer agrees in writing on 
 30.6   forms prescribed by the director to make the required employer 
 30.7   contributions, including any employer additional contributions, 
 30.8   on account of that person from revenue sources other than funds 
 30.9   provided under the federal Comprehensive Employment and Training 
 30.10  Act, or the person agrees in writing on forms prescribed by the 
 30.11  director to make the required employer contribution in addition 
 30.12  to the required employee contribution; 
 30.13     (32) off-duty peace officers while employed by the 
 30.14  metropolitan council; 
 30.15     (33) persons who are employed as full-time police officers 
 30.16  by the metropolitan council and as police officers are members 
 30.17  of the public employees police and fire fund; 
 30.18     (34) persons who are employed as full-time firefighters by 
 30.19  the department of military affairs and as firefighters are 
 30.20  members of the public employees police and fire fund; 
 30.21     (35) foreign citizens with a work permit of less than three 
 30.22  years, or an H-1b/JV visa valid for less than three years of 
 30.23  employment, unless notice of extension is supplied which allows 
 30.24  them to work for three or more years as of the date the 
 30.25  extension is granted, in which case they are eligible for 
 30.26  coverage from the date extended; and 
 30.27     (36) persons who are employed by the board of trustees of 
 30.28  the Minnesota state colleges and universities and who elect to 
 30.29  remain members of the public employees retirement association or 
 30.30  the Minneapolis employees retirement fund, whichever applies, 
 30.31  under section 136C.75. 
 30.32     Sec. 2.  Minnesota Statutes 2000, section 352B.01, 
 30.33  subdivision 2, is amended to read: 
 30.34     Subd. 2.  [MEMBER.] "Member" means: 
 30.35     (a) persons referred to and (1) a state patrol member 
 30.36  currently employed after June 30, 1943, under Laws 1929, chapter 
 31.1   355, as amended or supplemented, currently employed section 
 31.2   299D.03 by the state, who is a peace officer under section 
 31.3   626.84, and whose salaries salary or compensation is paid out of 
 31.4   state funds; 
 31.5      (b) (2) a conservation officer employed under section 
 31.6   97A.201, currently employed by the state, whose salary or 
 31.7   compensation is paid out of state funds; 
 31.8      (c) (3) a crime bureau officer who was employed by the 
 31.9   crime bureau and was a member of the highway patrolmen's 
 31.10  retirement fund on July 1, 1978, whether or not that person has 
 31.11  the power of arrest by warrant after that date, or who is 
 31.12  employed as police personnel, with powers of arrest by warrant 
 31.13  under section 299C.04, and who is currently employed by the 
 31.14  state, and whose salary or compensation is paid out of state 
 31.15  funds; 
 31.16     (d) (4) a person who is employed by the state in the 
 31.17  department of public safety in a data processing management 
 31.18  position with salary or compensation paid from state funds, who 
 31.19  was a crime bureau officer covered by the state patrol 
 31.20  retirement plan on August 15, 1987, and who was initially hired 
 31.21  in the data processing management position within the department 
 31.22  during September 1987, or January 1988, with membership 
 31.23  continuing for the duration of the person's employment in that 
 31.24  position, whether or not the person has the power of arrest by 
 31.25  warrant after August 15, 1987; and 
 31.26     (e) (5) a public safety employees employee defined as a 
 31.27  peace officers officer in section 626.84, subdivision 1, 
 31.28  paragraph (c), and employed with the division of alcohol and 
 31.29  gambling enforcement under section 299L.01; and 
 31.30     (6) a fugitive apprehension unit officer after October 31, 
 31.31  2000, employed by the office of special investigations of the 
 31.32  department of corrections who is a peace officer under section 
 31.33  626.84.  
 31.34     Sec. 3.  [DISPOSITION OF CERTAIN CONTRIBUTIONS.] 
 31.35     (a) The employee contributions for the period November 1, 
 31.36  2000, to the effective date of this section for a person 
 32.1   described in Minnesota Statutes, section 352B.01, subdivision 2, 
 32.2   clause (6), must be transferred, with 8.5 percent per annum 
 32.3   interest for the period from the date of the contribution to the 
 32.4   date of transfer, from the general state employees retirement 
 32.5   plan of the Minnesota state retirement system to the state 
 32.6   patrol retirement fund. 
 32.7      (b) The employer contributions associated with the employee 
 32.8   contributions governed by paragraph (a) also must be transferred 
 32.9   for the period from the date of the contribution to the date of 
 32.10  transfer, with 8.5 percent per annum interest, from the general 
 32.11  state employees retirement plan of the Minnesota state 
 32.12  retirement system to the state patrol retirement fund. 
 32.13     (c) A person described in Minnesota Statutes, section 
 32.14  352B.01, subdivision 2, clause (6), must pay, by additional 
 32.15  payroll deduction, to the state patrol retirement fund an amount 
 32.16  equal to the difference between the transferred employee 
 32.17  contributions and interest and the full member contribution 
 32.18  under Minnesota Statutes, section 352B.02, subdivision 1a, plus 
 32.19  8.5 percent per annum interest on the balance from March 1, 
 32.20  2001, to the date the additional payment is complete.  The 
 32.21  additional payment must be completed by December 31, 2001, or by 
 32.22  the date of retirement, whichever is earlier. 
 32.23     (d) The department of corrections, for each person 
 32.24  described in Minnesota Statutes, section 352B.01, subdivision 2, 
 32.25  clause (6), must pay, in a lump sum on July 1, 2001, to the 
 32.26  state patrol retirement fund an amount equal to the difference 
 32.27  between the transferred employer contributions and interest and 
 32.28  the full employer contribution under Minnesota Statutes, section 
 32.29  352B.02, subdivision 1c, plus 8.5 percent per annum interest on 
 32.30  the amount from March 1, 2001, to July 1, 2001. 
 32.31     Sec. 4.  [EFFECTIVE DATE.] 
 32.32     Sections 1 and 2 are effective retroactively to November 1, 
 32.33  2000.  Section 3 is effective on the day following final 
 32.34  enactment. 
 32.35                             ARTICLE 3
 32.36     REMEDIAL MEASURES FOR THE PERA-GENERAL FUNDING DEFICIENCY
 33.1      Section 1.  Minnesota Statutes 2000, section 11A.18, 
 33.2   subdivision 11, is amended to read: 
 33.3      Subd. 11.  [ADJUSTMENT FOR DISPOSITION OF MORTALITY GAINS 
 33.4   AND LOSSES.] (a) As of June 30 annually, the commission-retained 
 33.5   actuary shall calculate the amount of required reserves 
 33.6   representing any mortality gains and any mortality losses 
 33.7   incurred by each participating public pension fund or plan 
 33.8   during the fiscal year and report the results of those 
 33.9   calculations to the applicable participating public pension fund 
 33.10  or plan.  The actuary shall report separately the amount of the 
 33.11  reserves for annuitants and benefit recipients who are eligible 
 33.12  for a postretirement benefit adjustment and the amount of 
 33.13  reserves for annuitants and benefit recipients who are not 
 33.14  eligible for a postretirement benefit adjustment.  
 33.15     (b) A mortality stabilization reserve is established within 
 33.16  the Minnesota postretirement investment fund.  If the net amount 
 33.17  of required reserves calculated under paragraph (a) represents a 
 33.18  mortality gain, the participating public pension fund or plan 
 33.19  shall certify that amount to the state board, which shall sell 
 33.20  sufficient securities or transfer sufficient available 
 33.21  cash credit to the mortality stabilization reserve an amount 
 33.22  equal to the amount of money certified mortality gain.  If the 
 33.23  amount of required reserves calculated under paragraph (a) 
 33.24  represents a mortality loss, the participating public pension 
 33.25  fund or plan shall transfer to the state board shall deduct from 
 33.26  the mortality stabilization reserve an amount equal to the 
 33.27  amount of the net mortality loss.  
 33.28     (c) If a change in a mortality assumption of a 
 33.29  participating public pension plan is approved under section 
 33.30  356.215, subdivision 7, any associated reduction in the 
 33.31  actuarial accrued liability of the plan as calculated by the 
 33.32  commission-retained actuary under section 356.215 must be 
 33.33  credited to the mortality stabilization reserve by the state 
 33.34  board as a mortality gain and any associated increase in the 
 33.35  actuarial accrued liability of the plan as calculated by the 
 33.36  commission-retained actuary under section 356.215 must be 
 34.1   deducted from the mortality stabilization reserve by the state 
 34.2   board as a mortality loss. 
 34.3      (d) The amount of the transfers shall any mortality credit 
 34.4   or deduction must be determined before any postretirement 
 34.5   benefit adjustments have been made.  All transfers resulting 
 34.6   from mortality adjustments shall be completed annually by 
 34.7   December 31 for the preceding June 30.  Interest shall be 
 34.8   charged or credited on any transfers after December 31 based 
 34.9   upon the preretirement interest assumption for the participating 
 34.10  plan or fund as specified in section 356.215, subdivision 4d, 
 34.11  stated as a monthly rate.  Book values of the assets of the fund 
 34.12  for the purposes of subdivision 9 shall be determined only after 
 34.13  all adjustments for mortality gains and losses for the fiscal 
 34.14  year have been made. A net positive mortality stabilization 
 34.15  reserve amount must be deducted from the market value of the 
 34.16  Minnesota postretirement investment fund under subdivision 9, 
 34.17  paragraph (c), clause (1).  A net negative mortality 
 34.18  stabilization reserve amount must be considered a negative 
 34.19  balance under subdivision 9, paragraph (c), clauses (7), (8), 
 34.20  and (9). 
 34.21     Sec. 2.  Minnesota Statutes 2000, section 353.01, 
 34.22  subdivision 1, is amended to read: 
 34.23     Subdivision 1.  [TERMS.] Unless the language or context 
 34.24  clearly indicates that a different meaning is intended, each of 
 34.25  the following terms, for the purposes of this chapter, shall 
 34.26  be have the meaning given the meanings subjoined to them it. 
 34.27     Sec. 3.  Minnesota Statutes 2000, section 353.01, 
 34.28  subdivision 2, is amended to read: 
 34.29     Subd. 2.  [PUBLIC EMPLOYEE.] "Public employee" means an a 
 34.30  governmental employee performing personal services for a 
 34.31  governmental subdivision under defined in subdivision 6, whose 
 34.32  salary is paid, in whole or in part, from revenue derived from 
 34.33  taxation, fees, assessments, or from other sources.  The 
 34.34  term also includes special the classes of persons described or 
 34.35  listed in subdivision 2a, but.  The term also includes persons 
 34.36  who elect association membership under subdivision 2d, paragraph 
 35.1   (a), and persons for whom the applicable governmental 
 35.2   subdivision had elected association membership under subdivision 
 35.3   2d, paragraph (b).  The term excludes special the classes of 
 35.4   persons listed in subdivision 2b for purposes of membership in 
 35.5   the association.  Public employee does not include independent 
 35.6   contractors and their employees.  A reemployed annuitant under 
 35.7   section 353.37 must not be considered to be a public employee 
 35.8   for purposes of that reemployment. 
 35.9      Sec. 4.  Minnesota Statutes 2000, section 353.01, 
 35.10  subdivision 2a, is amended to read: 
 35.11     Subd. 2a.  [INCLUDED EMPLOYEES.] (a) Public employees whose 
 35.12  salary from one governmental subdivision exceeds $425 in any 
 35.13  month shall participate as members of the association.  If the 
 35.14  salary of an employee is less than $425 in a subsequent month, 
 35.15  the employee retains membership eligibility.  The following 
 35.16  persons are considered public employees: 
 35.17     (1) employees whose annual salary from one governmental 
 35.18  subdivision exceeds a stipulation prepared in advance, in 
 35.19  writing, to be not more than $5,100 per calendar year or per 
 35.20  school year for school employees for employment expected to be 
 35.21  of a full year's duration or more than the prorated portion of 
 35.22  $5,100 per employment period expected to be of less than a full 
 35.23  year's duration.  If compensation from one governmental 
 35.24  subdivision to an employee under this clause exceeds $5,100 per 
 35.25  calendar year or school year after being stipulated in advance 
 35.26  not to exceed that amount, the stipulation is no longer valid 
 35.27  and contributions must be made on behalf of the employee under 
 35.28  section 353.27, subdivision 12, from the month in which the 
 35.29  employee's salary first exceeded $425; 
 35.30     (2) employees whose total salary from concurrent 
 35.31  nontemporary positions in one governmental subdivision exceeds 
 35.32  $425 in any month; 
 35.33     (3) elected officers for service to which they were elected 
 35.34  by the public-at-large, or persons appointed to fill a vacancy 
 35.35  in an elective office, who elect to participate by filing an 
 35.36  application for membership, but not for service on a joint or 
 36.1   regional board that is a governmental subdivision under 
 36.2   subdivision 6, paragraph (a), unless the salary earned for that 
 36.3   service exceeds $425 in any month.  The option to become a 
 36.4   member, once exercised, may not be withdrawn during the 
 36.5   incumbency of the person in office; 
 36.6      (4) members who are appointed by the governor to be a state 
 36.7   department head and elect not to be covered by the Minnesota 
 36.8   state retirement system under section 352.021; 
 36.9      (5) employees of elected officers; 
 36.10     (6) persons who elect to remain members under section 
 36.11  480.181, subdivision 2; 
 36.12     (7) employees of a school district who receive separate 
 36.13  salaries for driving their own buses; 
 36.14     (8) employees of the Minnesota association of townships 
 36.15  when the board of the association, at its option, certifies to 
 36.16  the executive director that its employees are to be included for 
 36.17  purposes of retirement coverage, in which case coverage of all 
 36.18  employees of the association is permanent; 
 36.19     (9) employees of a county historical society who are county 
 36.20  employees; 
 36.21     (10) employees of a county historical society located in 
 36.22  the county whom the county, at its option, certifies to the 
 36.23  executive director to be county employees for purposes of 
 36.24  retirement coverage under this chapter, which status must be 
 36.25  accorded to all similarly situated county historical society 
 36.26  employees and, once established, must continue as long as a 
 36.27  person is an employee of the county historical society and is 
 36.28  not excluded under subdivision 2b; and 
 36.29     (11) employees who became members before July 1, 1988, 
 36.30  based on the total salary of positions held in more than one 
 36.31  governmental subdivision. shall participate as members of the 
 36.32  association with retirement coverage by the public employees 
 36.33  retirement plan or the public employees police and fire 
 36.34  retirement plan under this chapter, or the local government 
 36.35  correctional employees retirement plan under chapter 353E, 
 36.36  whichever applies, as a condition of their employment on the 
 37.1   first day of employment unless they: 
 37.2      (1) are specifically excluded under subdivision 2b; 
 37.3      (2) do not exercise their option to elect retirement 
 37.4   coverage in the association as provided in subdivision 2d, 
 37.5   paragraph (a); or 
 37.6      (3) are employees of the governmental subdivisions listed 
 37.7   in subdivision 2d, paragraph (b), where the governmental 
 37.8   subdivision has not elected to participate as a governmental 
 37.9   subdivision covered by the association. 
 37.10     (b) A public employee who was a member of the association 
 37.11  on June 30, 2002, based on employment that qualified for 
 37.12  membership coverage by the public employees retirement plan or 
 37.13  the public employees police and fire plan under this chapter, or 
 37.14  the local government correctional employees retirement plan 
 37.15  under chapter 353E as of June 30, 2002, retains that membership 
 37.16  until the employee terminates public employment under 
 37.17  subdivision 11a or terminates membership under subdivision 11b. 
 37.18     Sec. 5.  Minnesota Statutes 2000, section 353.01, 
 37.19  subdivision 2b, is amended to read: 
 37.20     Subd. 2b.  [EXCLUDED EMPLOYEES.] The following public 
 37.21  employees shall are not eligible to participate as members of 
 37.22  the association with retirement coverage by the public employees 
 37.23  retirement plan, the local government correctional employees 
 37.24  retirement plan under chapter 353E, or the public employees 
 37.25  police and fire retirement plan: 
 37.26     (1) elected public officers, other than county sheriffs, 
 37.27  who are elected to a governing body, or persons who are 
 37.28  appointed to fill a vacancy in an elective office who do not 
 37.29  elect to participate in the association by filing an application 
 37.30  for membership of a governing body, whose term of office first 
 37.31  commences on or after July 1, 2002, for the service to be 
 37.32  rendered in that elective position.  Elected governing body 
 37.33  officials who were active members of the association's 
 37.34  coordinated or basic retirement plans as of June 30, 2002, 
 37.35  continue participation throughout incumbency in office until 
 37.36  termination of public service occurs as defined in subdivision 
 38.1   11a; 
 38.2      (2) election officers or election judges; 
 38.3      (3) patient and inmate personnel who perform services in 
 38.4   charitable, penal, or correctional institutions of for a 
 38.5   governmental subdivision; 
 38.6      (4) employees who are hired for a temporary position under 
 38.7   subdivision 12a, and employees who resign from a nontemporary 
 38.8   position and accept a temporary position within 30 days in the 
 38.9   same governmental subdivision, but not those.  An employer must 
 38.10  not apply the definition of temporary position so as to exclude 
 38.11  employees who are hired for an unlimited period to fill 
 38.12  positions that are permanent or that are for an unspecified 
 38.13  period but who are serving a probationary period at the start of 
 38.14  the employment.  If the period of employment extends beyond six 
 38.15  consecutive months and the employee earns more than $425 from 
 38.16  one governmental subdivision in any one calendar month, the 
 38.17  department head shall report the employee for membership and 
 38.18  require employee deductions be made on behalf of the employee 
 38.19  under section 353.27, subdivision 4. 
 38.20     The membership eligibility of an employee who resigns or is 
 38.21  dismissed from a temporary position and within 30 days accepts 
 38.22  another temporary position in the same governmental subdivision 
 38.23  is determined on the total length of employment rather than on 
 38.24  each separate position.  Membership eligibility of an employee 
 38.25  who holds concurrent temporary and nontemporary positions in one 
 38.26  governmental subdivision is determined by the length of 
 38.27  employment and salary of each separate position; 
 38.28     (5) employees whose actual salary from one governmental 
 38.29  subdivision does not exceed $425 per month, or whose annual 
 38.30  salary from one governmental subdivision does not exceed a 
 38.31  stipulation prepared in advance, in writing, that the salary 
 38.32  must not exceed $5,100 per calendar year or per school year for 
 38.33  school employees for employment expected to be of a full year's 
 38.34  duration or more than the prorated portion of $5,100 per 
 38.35  employment period for employment expected to be of less than a 
 38.36  full year's duration; 
 39.1      (6) employees who are employed by reason of work emergency 
 39.2   caused by fire, flood, storm, or similar disaster; 
 39.3      (7) (6) employees who by virtue of their employment in one 
 39.4   governmental subdivision are required by law to be a member of 
 39.5   and to contribute to any of the plans or funds administered by 
 39.6   the Minnesota state retirement system, the teachers retirement 
 39.7   association, the Duluth teachers retirement fund association, 
 39.8   the Minneapolis teachers retirement association, the St. Paul 
 39.9   teachers retirement fund association, the Minneapolis employees 
 39.10  retirement fund, or any police or firefighters relief 
 39.11  association governed by section 69.77 that has not consolidated 
 39.12  with the public employees retirement association, or any local 
 39.13  police or firefighters consolidation account but who have not 
 39.14  elected the type of benefit coverage provided by the public 
 39.15  employees police and fire fund under sections 353A.01 to 
 39.16  353A.10, or any persons covered by section 353.665, subdivision 
 39.17  4, 5, or 6, who have not elected public employees police and 
 39.18  fire plan benefit coverage.  This clause must not be construed 
 39.19  to prevent a person from being a member of and contributing to 
 39.20  the public employees retirement association and also belonging 
 39.21  to and contributing to another public pension fund for other 
 39.22  service occurring during the same period of time.  A person who 
 39.23  meets the definition of "public employee" in subdivision 2 by 
 39.24  virtue of other service occurring during the same period of time 
 39.25  becomes a member of the association unless contributions are 
 39.26  made to another public retirement fund on the salary based on 
 39.27  the other service or to the teachers retirement association by a 
 39.28  teacher as defined in section 354.05, subdivision 2; 
 39.29     (8) (7) persons who are members of a religious order and 
 39.30  are excluded from coverage under the federal Old Age, Survivors, 
 39.31  Disability, and Health Insurance Program for the performance of 
 39.32  service as specified in United States Code, title 42, section 
 39.33  410(a)(8)(A), as amended through January 1, 1987, if no 
 39.34  irrevocable election of coverage has been made under section 
 39.35  3121(r) of the Internal Revenue Code of 1954, as amended; 
 39.36     (9) full-time students who (8) employees who at the time 
 40.1   they are hired by a governmental subdivision are enrolled and on 
 40.2   a full-time basis to attend or are regularly attending classes 
 40.3   at an accredited school, college, or university and who are 
 40.4   part-time employees as defined by a governmental subdivision in 
 40.5   an undergraduate, graduate, or professional-technical program, 
 40.6   or a public or charter high school, if the employment is 
 40.7   predicated on the student status of the individual; 
 40.8      (10) (9) resident physicians, medical interns, and 
 40.9   pharmacist residents and pharmacist interns who are serving in a 
 40.10  degree or residency program in public hospitals; 
 40.11     (11) (10) students who are serving in an internship or 
 40.12  residency program sponsored by an accredited educational 
 40.13  institution; 
 40.14     (12) (11) persons who hold a part-time adult supplementary 
 40.15  technical college license who render part-time teaching service 
 40.16  in a technical college; 
 40.17     (13) (12) foreign citizens working for a governmental 
 40.18  subdivision with a work permit of less than three years, or an 
 40.19  H-1b visa valid for less than three years of employment.  Upon 
 40.20  notice to the association that the work permit or visa extends 
 40.21  beyond the three-year period, the foreign citizens are eligible 
 40.22  for membership from the date of the extension; 
 40.23     (14) (13) public hospital employees who elected not to 
 40.24  participate as members of the association before 1972 and who 
 40.25  did not elect to participate from July 1, 1988, to October 1, 
 40.26  1988; 
 40.27     (15) (14) except as provided in section 353.86, volunteer 
 40.28  ambulance service personnel, as defined in subdivision 35, but 
 40.29  persons who serve as volunteer ambulance service personnel may 
 40.30  still qualify as public employees under subdivision 2 and may be 
 40.31  members of the public employees retirement association and 
 40.32  participants in the public employees retirement fund or the 
 40.33  public employees police and fire fund, whichever applies, on the 
 40.34  basis of compensation received from public employment service 
 40.35  other than service as volunteer ambulance service personnel; 
 40.36     (16) (15) except as provided in section 353.87, volunteer 
 41.1   firefighters, as defined in subdivision 36, engaging in 
 41.2   activities undertaken as part of volunteer firefighter duties; 
 41.3   provided that a person who is a volunteer firefighter may still 
 41.4   qualify as a public employee under subdivision 2 and may be a 
 41.5   member of the public employees retirement association and a 
 41.6   participant in the public employees retirement fund or the 
 41.7   public employees police and fire fund, whichever applies, on the 
 41.8   basis of compensation received from public employment activities 
 41.9   other than those as a volunteer firefighter; 
 41.10     (17) pipefitters and associated trades personnel employed 
 41.11  by independent school district No. 625, St. Paul, with coverage 
 41.12  by the pipefitters local 455 pension plan under a collective 
 41.13  bargaining agreement who were either first employed after May 1, 
 41.14  1997, or, if first employed before May 2, 1997, elected to be 
 41.15  excluded under Laws 1997, chapter 241, article 2, section 12; 
 41.16  and 
 41.17     (18) (16) electrical workers, plumbers, carpenters, and 
 41.18  associated trades personnel employed by independent school 
 41.19  district No. 625, St. Paul, or the city of St. Paul, with who 
 41.20  have retirement coverage by the electrical workers local 110 
 41.21  pension plan, the united association plumbers local 34 pension 
 41.22  plan, or the carpenters local 87 pension plan under a collective 
 41.23  bargaining agreement who were either first employed after May 1, 
 41.24  2000, or, if first employed before May 2, 2000, elected to be 
 41.25  excluded under Laws 2000, chapter 461, article 7, section 5.; 
 41.26     (17) employees who are hired after June 30, 2002, to fill 
 41.27  seasonal positions under subdivision 12b which are limited in 
 41.28  duration by the employer to 185 consecutive calendar days or 
 41.29  less in each business year of the governmental subdivision; 
 41.30     (18) persons who are provided sheltered employment or 
 41.31  work-study positions by a governmental subdivision and who 
 41.32  participate in an employment or industries program maintained 
 41.33  for the benefit of these persons where the governmental 
 41.34  subdivision limits the position's duration to three years or 
 41.35  less, including persons participating in a federal or state 
 41.36  subsidized on-the-job training, work experience, senior citizen, 
 42.1   youth, or unemployment relief program where the training or work 
 42.2   experience is not provided as a part of, or for, future 
 42.3   permanent public employment; 
 42.4      (19) independent contractors and the employees of 
 42.5   independent contractors; 
 42.6      (20) reemployed annuitants of the association during the 
 42.7   course of that reemployment; and 
 42.8      (21) employees of a common school district as defined in 
 42.9   section 120A.05, subdivision 5, an independent school district 
 42.10  as defined in section 120A.05, subdivision 10, a special school 
 42.11  district as defined in section 120A.05, subdivision 14, any 
 42.12  instrumentality of a common, independent, or special school 
 42.13  district, or any governmental entity comprised wholly of common, 
 42.14  independent, or special school districts. 
 42.15     Sec. 6.  Minnesota Statutes 2000, section 353.01, is 
 42.16  amended by adding a subdivision to read: 
 42.17     Subd. 2d.  [OPTIONAL MEMBERSHIP.] (a) Membership in the 
 42.18  association is optional by action of the individual employee for 
 42.19  the following public employees who meet the conditions set forth 
 42.20  in subdivision 2a: 
 42.21     (1) members of the coordinated plan who are also employees 
 42.22  of labor organizations as defined in section 353.017, 
 42.23  subdivision 1, for their employment by the labor organization 
 42.24  only if they elect to have membership under section 353.017, 
 42.25  subdivision 2; 
 42.26     (2) persons who are elected or persons who are appointed to 
 42.27  elected positions other than local governing body elected 
 42.28  positions who elect to participate by filing a written election 
 42.29  for membership; 
 42.30     (3) members of the association who are appointed by the 
 42.31  governor to be a state department head and who elect not to be 
 42.32  covered by the general state employees retirement plan of the 
 42.33  Minnesota state retirement system under section 352.021; and 
 42.34     (4) city managers as defined in section 353.028, 
 42.35  subdivision 1, who do not elect to be excluded from membership 
 42.36  in the association under section 353.028, subdivision 2. 
 43.1      (b) Membership in the association is optional by action of 
 43.2   the governmental subdivision for the employees of the following 
 43.3   governmental subdivisions under the conditions specified: 
 43.4      (1) the Minnesota association of townships if the board of 
 43.5   the association, at its option, certifies to the executive 
 43.6   director that its employees are to be included for purposes of 
 43.7   retirement coverage, in which case the status of the association 
 43.8   as a participating employer is permanent; and 
 43.9      (2) a county historical society if the county in which the 
 43.10  historical society is located, at its option, certifies to the 
 43.11  executive director that the employees of the historical society 
 43.12  are to be county employees for purposes of retirement coverage 
 43.13  under this chapter.  The status as a county employee must be 
 43.14  accorded to all similarly situated county historical society 
 43.15  employees and, once established, must continue as long as a 
 43.16  person is an employee of the county historical society. 
 43.17     (c) For employees who are covered by paragraph (a), clause 
 43.18  (1), (2), or (3), or covered by paragraph (b), if the necessary 
 43.19  membership election is not made, the employee is excluded from 
 43.20  retirement coverage under this chapter.  For employees who are 
 43.21  covered by paragraph (a), clause (4), if the necessary election 
 43.22  is not made, the employee must become a member and have 
 43.23  retirement coverage under this chapter.  The option to become a 
 43.24  member, once exercised under this subdivision, may not be 
 43.25  withdrawn until termination of public service as defined under 
 43.26  subdivision 11a. 
 43.27     Sec. 7.  Minnesota Statutes 2000, section 353.01, 
 43.28  subdivision 6, is amended to read: 
 43.29     Subd. 6.  [GOVERNMENTAL SUBDIVISION.] (a) "Governmental 
 43.30  subdivision" means a county, city, or town, school district 
 43.31  within this state, or a department or unit of state government, 
 43.32  or any public body whose revenues are derived from taxation, 
 43.33  fees, assessments or from other sources. 
 43.34     (b) Governmental subdivision also means the public 
 43.35  employees retirement association, the league of Minnesota 
 43.36  cities, the association of metropolitan municipalities, public 
 44.1   hospitals owned or operated by, or an integral part of, a 
 44.2   governmental subdivision or governmental subdivisions, the 
 44.3   association of Minnesota counties, the metropolitan intercounty 
 44.4   association, the Minnesota municipal utilities association, the 
 44.5   metropolitan airports commission, the Minneapolis employees 
 44.6   retirement fund for employment initially commenced after June 
 44.7   30, 1979, the range association of municipalities and schools, 
 44.8   soil and water conservation districts, and economic development 
 44.9   authorities created or operating under sections 469.090 to 
 44.10  469.108. 
 44.11     (c) Governmental subdivision does not mean a school 
 44.12  district; any municipal housing and redevelopment authority 
 44.13  organized under the provisions of sections 469.001 to 469.047; 
 44.14  or any port authority organized under sections 469.048 to 
 44.15  469.089; or any hospital district organized or reorganized prior 
 44.16  to July 1, 1975, under sections 447.31 to 447.37 or the 
 44.17  successor of the district, nor the Minneapolis community 
 44.18  development agency.  
 44.19     Sec. 8.  Minnesota Statutes 2000, section 353.01, 
 44.20  subdivision 7, is amended to read: 
 44.21     Subd. 7.  [MEMBER.] "Member" means a person who accepts 
 44.22  employment as a "public employee" under subdivision 2, who is an 
 44.23  employee who works in one or more positions that require or 
 44.24  allow membership in the association under subdivision 2a or 
 44.25  2d, for whom contributions have been withheld from salary and 
 44.26  who is not covered by the plan established in chapter 353D or 
 44.27  excluded under subdivision 2b.  A person who is a member remains 
 44.28  a member while performing services as a public employee and 
 44.29  while on an authorized leave of absence or an authorized 
 44.30  temporary layoff. 
 44.31     Sec. 9.  Minnesota Statutes 2000, section 353.01, 
 44.32  subdivision 11b, is amended to read: 
 44.33     Subd. 11b.  [TERMINATION OF MEMBERSHIP.] (a) "Termination 
 44.34  of membership" means the conclusion of membership in the 
 44.35  association and occurs: 
 44.36     (1) upon termination of public service under subdivision 
 45.1   11a; 
 45.2      (2) when a member who is a part-time employee is excluded 
 45.3   from membership as a full-time student under subdivision 2b, 
 45.4   clause (9); 
 45.5      (3) when a member does not return to work within 30 days of 
 45.6   the expiration of an authorized temporary layoff under 
 45.7   subdivision 12 or an authorized leave of absence under 
 45.8   subdivision 31.  If the employee subsequently returns to a 
 45.9   position in the same governmental subdivision, the employee 
 45.10  shall not again be required to earn a salary in excess of $425 
 45.11  per month, unless the employee has taken a refund of accumulated 
 45.12  employee deductions plus interest under section 353.34, 
 45.13  subdivision 1 as evidenced by the appropriate record filed by 
 45.14  the governmental subdivision; or 
 45.15     (4) (3) when a person files a written election to 
 45.16  discontinue employee deductions under section 353.27, 
 45.17  subdivision 7, paragraph (a), clause (1). 
 45.18     (b) The termination of membership must be reported to the 
 45.19  association by the governmental subdivision. 
 45.20     Sec. 10.  Minnesota Statutes 2000, section 353.01, 
 45.21  subdivision 12, is amended to read: 
 45.22     Subd. 12.  [AUTHORIZED TEMPORARY LAYOFF.] "Authorized 
 45.23  temporary layoff," including seasonal leave of absence, means a 
 45.24  suspension of public service authorized by the employing 
 45.25  governmental subdivision for a specified period not exceeding 
 45.26  three months in any calendar year, as evidenced by appropriate 
 45.27  record of the employer and promptly transmitted to the 
 45.28  association.  The association shall credit the member for an 
 45.29  authorized temporary layoff only as provided in subdivision 16, 
 45.30  paragraph (a), clause (4). 
 45.31     Sec. 11.  Minnesota Statutes 2000, section 353.01, 
 45.32  subdivision 12a, is amended to read: 
 45.33     Subd. 12a.  [TEMPORARY POSITION.] (1) "Temporary position" 
 45.34  means an employment position predetermined by the employer at 
 45.35  the time of hiring to be a period of six months or less or.  
 45.36  Temporary position also means an employment position occupied by 
 46.1   a person hired by the employer as a temporary replacement who is 
 46.2   employed for a predetermined period of six months or less. 
 46.3      (2) "Temporary position" does not mean an employment 
 46.4   position for an unlimited period a specified term in which a 
 46.5   person serves a probationary period or works an irregular 
 46.6   schedule as a requirement for subsequent employment on a 
 46.7   permanent or unlimited basis. 
 46.8      Sec. 12.  Minnesota Statutes 2000, section 353.01, is 
 46.9   amended by adding a subdivision to read: 
 46.10     Subd. 12b.  [SEASONAL POSITION.] "Seasonal position" means 
 46.11  a position where the nature of the work or its duration are 
 46.12  related to a specific season or seasons of the year, regardless 
 46.13  of whether or not the employing agency anticipates that the same 
 46.14  employee will return to the position each season in which it 
 46.15  becomes available.  The entire period of employment in a 
 46.16  business year must be used to determine whether or not a 
 46.17  position may be excluded as seasonal when there is less than a 
 46.18  30-day break between one seasonal position and a subsequent 
 46.19  seasonal position for employment with the same governmental 
 46.20  employer.  Seasonal positions include, but are not limited to, 
 46.21  coaching athletic activities; employment to plow snow or to 
 46.22  maintain roads or parks, or to operate skating rinks, ski 
 46.23  lodges, golf courses, or swimming pools. 
 46.24     Sec. 13.  Minnesota Statutes 2000, section 353.01, 
 46.25  subdivision 16, is amended to read: 
 46.26     Subd. 16.  [ALLOWABLE SERVICE; LIMITS AND COMPUTATION.] (a) 
 46.27  "Allowable service" means: 
 46.28     (1) service during years of actual membership in the course 
 46.29  of which employee contributions were made, periods covered by 
 46.30  payments in lieu of salary deductions under section 353.35, and; 
 46.31     (2) service in years during which the public employee was 
 46.32  not a member but for which the member later elected, while a 
 46.33  member, to obtain credit by making payments to the fund as 
 46.34  permitted by any law then in effect.; 
 46.35     (b) "Allowable service" also means (3) a period of 
 46.36  authorized leave of absence with pay from which deductions for 
 47.1   employee contributions are made, deposited, and credited to the 
 47.2   fund.; 
 47.3      (c) "Allowable service" also means (4) a period of 
 47.4   authorized personal, parental, or medical leave of absence 
 47.5   without pay, including a leave of absence covered under the 
 47.6   federal Family Medical Leave Act, that does not exceed one year, 
 47.7   and during or for which a member obtained full or fractional 
 47.8   service credit for each month in the leave period by payments to 
 47.9   the fund made in place of salary deductions, provided that.  The 
 47.10  payments are must be made in an amount or amounts based on the 
 47.11  member's average salary on which deductions were paid for the 
 47.12  last six months of public service, or for that portion of the 
 47.13  last six months while the member was in public service, to apply 
 47.14  to the period in either case that immediately preceding precedes 
 47.15  the commencement of the leave of absence.  If the employee 
 47.16  elects to pay the employee contributions for the period of 
 47.17  any authorized personal, parental, or medical leave of absence 
 47.18  without pay, or for any portion of the leave, the employee shall 
 47.19  also, as a condition to the exercise of the election, pay to the 
 47.20  fund an amount equivalent to both the required employer and the 
 47.21  additional employer contributions, if any, for the employee.  
 47.22  The payment must be made within one year from the expiration of 
 47.23  the leave of absence or within 20 days after termination of 
 47.24  public service under subdivision 11a.  The employer, if by 
 47.25  appropriate action of its governing body, which is made a part 
 47.26  of its official records, and which is adopted before the date of 
 47.27  the first payment of the employee contribution, may certify to 
 47.28  the association in writing its commitment to pay the employer 
 47.29  and additional employer contributions from the proceeds of a tax 
 47.30  levy made under section 353.28.  Payments under this paragraph 
 47.31  must include interest at an annual rate of 8.5 percent 
 47.32  compounded annually from the date of the termination of the 
 47.33  leave of absence to the date payment is made.  An employee shall 
 47.34  return to public service and receive render a minimum of three 
 47.35  months of allowable service in order to be eligible to pay 
 47.36  employee and employer contributions for a subsequent authorized 
 48.1   leave of absence without pay.  Upon payment, the employee must 
 48.2   be granted allowable service credit for full calendar months or 
 48.3   fractions of a month during the leave period as described in 
 48.4   paragraph (d), clauses (1) and (2), based on the salary or the 
 48.5   compensated hours used in computing the payment amount; 
 48.6      (d) "Allowable service" also means (5) a periodic, 
 48.7   repetitive leave that is offered to all employees of a 
 48.8   governmental subdivision.  The leave program may not exceed 208 
 48.9   hours per annual normal work cycle as certified to the 
 48.10  association by the employer.  A participating member obtains 
 48.11  service credit by making employee contributions in an amount or 
 48.12  amounts based on the member's average salary that would have 
 48.13  been paid if the leave had not been taken.  The employer shall 
 48.14  pay the employer and additional employer contributions on behalf 
 48.15  of the participating member.  The employee and the employer are 
 48.16  responsible to pay interest on their respective shares at the 
 48.17  rate of 8.5 percent a year, compounded annually, from the end of 
 48.18  the normal cycle until full payment is made.  An employer shall 
 48.19  also make the employer and additional employer contributions, 
 48.20  plus 8.5 percent interest, compounded annually, on behalf of an 
 48.21  employee who makes employee contributions but terminates public 
 48.22  service.  The employee contributions must be made within one 
 48.23  year after the end of the annual normal working cycle or within 
 48.24  20 days after termination of public service, whichever is 
 48.25  sooner.  The association shall prescribe the manner and forms to 
 48.26  be used by a governmental subdivision in administering a 
 48.27  periodic, repetitive leave.  Upon payment, the member must be 
 48.28  granted allowable service credit for full calendar months or 
 48.29  fractions of a month during the leave period as described in 
 48.30  paragraph (d), clauses (1) and (2), based on the salary or the 
 48.31  compensated hours used in computing the payment amount; 
 48.32     (e) "Allowable service" also means a period during which a 
 48.33  member is on an authorized sick leave of absence, without pay, 
 48.34  limited to one year.  An employee who has received one year of 
 48.35  allowable service shall return to public service and receive a 
 48.36  minimum of three months of allowable service to receive 
 49.1   allowable service for a subsequent authorized sick leave of 
 49.2   absence. 
 49.3      (f) "Allowable service" also means (6) an authorized 
 49.4   temporary layoff under subdivision 12,.  For temporary layoffs 
 49.5   that begin before July 1, 2001, allowable service credit is 
 49.6   limited to three months allowable service per authorized 
 49.7   temporary layoff in one calendar year.  An employee who has 
 49.8   received the maximum service allowed for an authorized temporary 
 49.9   layoff shall return to public service and receive a minimum of 
 49.10  three months of allowable service to receive allowable service 
 49.11  for a subsequent authorized temporary layoff.  For temporary 
 49.12  layoffs that begin on or after July 1, 2001, allowable service 
 49.13  credit for the calendar month in which the member does not 
 49.14  receive salary due to the layoff must be determined using the 
 49.15  following formula: 
 49.16     (i) members who earned one month of allowable service 
 49.17  credit for each of the nine calendar months of compensated 
 49.18  employment with the governmental subdivision authorizing the 
 49.19  layoff that immediately preceded the layoff shall receive one 
 49.20  month of allowable service credit, limited to three months of 
 49.21  allowable service credit per year, for each month of the 
 49.22  temporary layoff; or 
 49.23     (ii) members who earned less than nine months of allowable 
 49.24  service credit in the year of compensated employment with the 
 49.25  governmental subdivision authorizing the layoff that immediately 
 49.26  preceded the layoff shall receive allowable service credit on a 
 49.27  fractional basis for each month of the authorized layoff, 
 49.28  limited to three months of allowable service credit, determined 
 49.29  by dividing the total number of months of service credit earned 
 49.30  for the compensated employment by nine and multiplying the 
 49.31  resulting number by the total number of months in the layoff 
 49.32  period that are not compensated; or 
 49.33     (g) Notwithstanding any law to the contrary, "allowable 
 49.34  service" also means a parental leave.  The association shall 
 49.35  grant a maximum of two months service credit for a parental 
 49.36  leave, within six months after the birth or adoption, upon 
 50.1   documentation from the member's governmental subdivision or 
 50.2   presentation of a birth certificate or other evidence of birth 
 50.3   or adoption to the association. 
 50.4      (h) "Allowable service" also means (7) a period during 
 50.5   which a member is on an authorized leave of absence to enter 
 50.6   military service in the armed forces of the United States, 
 50.7   provided that the member returns to public service upon 
 50.8   discharge from military service under section 192.262 and pays 
 50.9   into the fund employee contributions based upon the employee's 
 50.10  salary at the date of return from military service.  Payment 
 50.11  must be made within three times the length of the military leave 
 50.12  period, or five years of the date of discharge from the military 
 50.13  service, whichever is less.  The amount of these contributions 
 50.14  must be in accord with the contribution rates and salary 
 50.15  limitations, if any, in effect during the leave, plus interest 
 50.16  at an annual rate of 8.5 percent compounded annually from the 
 50.17  date of return to public service to the date payment is made.  
 50.18  The matching employer contribution and additional employer 
 50.19  contribution under section 353.27, subdivisions 3 and 3a, must 
 50.20  be paid by the governmental subdivision employing the member 
 50.21  upon return to public service if the member makes the employee 
 50.22  contributions.  The governmental subdivision involved may 
 50.23  appropriate money for those payments.  A member may not receive 
 50.24  credit for a voluntary extension of military service at the 
 50.25  instance of the member beyond the initial period of enlistment, 
 50.26  induction, or call to active duty.  Upon payment, the employee 
 50.27  must be granted allowable service credit for full calendar 
 50.28  months or fractions of a month during the leave period as 
 50.29  described in paragraph (d), clauses (1) and (2), based on the 
 50.30  salary or compensated hours used in computing the payment amount.
 50.31     (i) (b) For calculating benefits under sections 353.30, 
 50.32  353.31, 353.32, and 353.33 for state officers and employees 
 50.33  displaced by the Community Corrections Act, chapter 401, and 
 50.34  transferred into county service under section 401.04, "allowable 
 50.35  service" means combined years of allowable service as defined in 
 50.36  paragraphs paragraph (a) to (i), clauses (1) to (6), and section 
 51.1   352.01, subdivision 11.  
 51.2      (j) (c) For a public employee who has prior service covered 
 51.3   by a local police or firefighters relief association that has 
 51.4   consolidated with the public employees retirement association or 
 51.5   to which section 353.665 applies, and who has elected the type 
 51.6   of benefit coverage provided by the public employees police and 
 51.7   fire fund either under section 353A.08 following the 
 51.8   consolidation or under section 353.665, subdivision 4, 
 51.9   "applicable service" is a period of service credited by the 
 51.10  local police or firefighters relief association as of the 
 51.11  effective date of the consolidation based on law and on bylaw 
 51.12  provisions governing the relief association on the date of the 
 51.13  initiation of the consolidation procedure. 
 51.14     (d) For persons who, after June 30, 2001, either first 
 51.15  become members or terminated membership under subdivision 11b, 
 51.16  and again become members, of the public employees retirement 
 51.17  plan, the public employees police and fire plan under this 
 51.18  chapter, or the local government correctional employee 
 51.19  retirement plan under chapter 353E, whichever applies, 
 51.20  "allowable service" means credit for compensated hours from 
 51.21  which deductions are made, or for which payments are made in 
 51.22  lieu of salary deductions as provided under this subdivision, 
 51.23  and which are deposited and credited in the fund as provided in 
 51.24  section 353.27, determined as follows: 
 51.25     (1) one month of allowable service credit for each month 
 51.26  during which the employee has received salary for 80 or more 
 51.27  compensated hours; or 
 51.28     (2) a fraction of one month of allowable service for each 
 51.29  month for which the employee has received salary for less than 
 51.30  80 compensated hours equal to the percentage relationship that 
 51.31  the number of compensated hours bear to 80 hours. 
 51.32     (e) Elected officials and other public employees who are 
 51.33  compensated solely on an annual basis shall be granted a full 
 51.34  year of credit for each year for which compensation is earned. 
 51.35     (f) Allowable service that is determined and credited on a 
 51.36  fractional basis must be used only in calculating the amount of 
 52.1   benefits payable.  In determining the length of service required 
 52.2   for vesting, a member shall be granted a month of service credit 
 52.3   for each month in which the member received compensation from 
 52.4   which employee contributions were deducted.  For periods of 
 52.5   part-time service that are duplicated service credit, section 
 52.6   356.30, subdivision 1, paragraphs (g) and (h), govern. 
 52.7      (g) No member shall receive more than 12 months of 
 52.8   allowable service credit in a year for either vesting purposes 
 52.9   or for benefit calculation purposes. 
 52.10     Sec. 14.  Minnesota Statutes 2000, section 353.01, is 
 52.11  amended by adding a subdivision to read: 
 52.12     Subd. 38.  [BUSINESS YEAR.] "Business year" means the first 
 52.13  day of the first full pay period through the last day of the 
 52.14  last full pay period of the 12-month fiscal year applicable to 
 52.15  the respective governmental subdivision. 
 52.16     Sec. 15.  Minnesota Statutes 2000, section 353.01, is 
 52.17  amended by adding a subdivision to read: 
 52.18     Subd. 39.  [COMPENSATED HOURS.] "Compensated hours" means 
 52.19  the hours during which an employee performs services in one or 
 52.20  more positions for a single governmental subdivision for which 
 52.21  the employee receives compensation.  The term also includes the 
 52.22  following: 
 52.23     (1) paid holiday hours for which the employee is not 
 52.24  required to work; 
 52.25     (2) paid used sick leave hours; 
 52.26     (3) paid used personal leave hours and vacation hours; and 
 52.27     (4) the paid hours drawn from accrued compensatory time. 
 52.28     Sec. 16.  Minnesota Statutes 2000, section 353.026, is 
 52.29  amended to read: 
 52.30     353.026 [COVERAGE FOR CERTAIN MUNICIPAL AND SCHOOL DISTRICT 
 52.31  EMPLOYEES.] 
 52.32     Any person who was employed by the city of Minneapolis, 
 52.33  Special School District No. 1, or public corporation as defined 
 52.34  in section 422A.01, subdivision 9, on or after July 1, 1978 and 
 52.35  prior to July 1, 1979, and who was excluded from retirement 
 52.36  coverage by the coordinated program of the Minneapolis municipal 
 53.1   employees retirement fund pursuant to section 422A.09, 
 53.2   subdivision 3, shall be entitled to retirement coverage by the 
 53.3   public employees retirement association unless specifically 
 53.4   excluded pursuant to section 353.01, subdivision 2b, from and 
 53.5   after May 19, 1981.  
 53.6      Sec. 17.  Minnesota Statutes 2000, section 353.03, 
 53.7   subdivision 1, is amended to read: 
 53.8      Subdivision 1.  [MANAGEMENT; COMPOSITION; ELECTION.] (a) 
 53.9   The management of the public employees retirement fund is vested 
 53.10  in an 11-member board of trustees consisting of ten members and 
 53.11  the state auditor who.  The state auditor may designate a deputy 
 53.12  auditor with expertise in pension matters as the auditor's 
 53.13  representative on the board.  
 53.14     (b) The governor shall appoint five trustees to four-year 
 53.15  terms, one of whom shall be designated to represent school 
 53.16  boards townships and special districts, one to represent cities, 
 53.17  one to represent counties, one who is a retired annuitant, and 
 53.18  one who is a public member knowledgeable in pension matters.  
 53.19     (c) The membership of the association, including recipients 
 53.20  of retirement annuities and disability and survivor benefits, 
 53.21  shall elect five trustees, one of whom must be a member of the 
 53.22  police and fire fund and one of whom must be a former member who 
 53.23  met the definition of public employee under section 353.01, 
 53.24  subdivisions 2 and 2a, for at least five years prior to 
 53.25  terminating membership or a member who receives a disability 
 53.26  benefit, for terms of four years.  Except as provided in this 
 53.27  subdivision, trustees elected by the membership of the 
 53.28  association must be public employees and members of the 
 53.29  association.  
 53.30     (d) For seven days beginning October 1 of each year 
 53.31  preceding a year in which an election is held, the association 
 53.32  shall accept at its office filings in person or by mail of 
 53.33  candidates for the board of trustees.  A candidate shall submit 
 53.34  at the time of filing a nominating petition signed by 25 or more 
 53.35  members of the fund.  No name may be withdrawn from nomination 
 53.36  by the nominee after October 15.  At the request of a candidate 
 54.1   for an elected position on the board of trustees, the board 
 54.2   shall mail a statement of up to 300 words prepared by the 
 54.3   candidate to all persons eligible to vote in the election of the 
 54.4   candidate.  The board may adopt policies to govern form and 
 54.5   length of these statements, timing of mailings, and deadlines 
 54.6   for submitting materials to be mailed.  These policies must be 
 54.7   approved by the secretary of state.  The secretary of state 
 54.8   shall resolve disputes between the board and a candidate 
 54.9   concerning application of these policies to a particular 
 54.10  statement.  
 54.11     (e) A candidate who: 
 54.12     (1) receives contributions or makes expenditures in excess 
 54.13  of $100; or 
 54.14     (2) has given implicit or explicit consent for any other 
 54.15  person to receive contributions or make expenditures in excess 
 54.16  of $100 for the purpose of bringing about the candidate's 
 54.17  election, shall file a report with the campaign finance and 
 54.18  public disclosure board disclosing the source and amount of all 
 54.19  contributions to the candidate's campaign.  The campaign finance 
 54.20  and public disclosure board shall prescribe forms governing 
 54.21  these disclosures.  Expenditures and contributions have the 
 54.22  meaning defined in section 10A.01.  These terms do not include 
 54.23  the mailing made by the association board on behalf of the 
 54.24  candidate.  A candidate shall file a report within 30 days from 
 54.25  the day that the results of the election are announced.  The 
 54.26  campaign finance and public disclosure board shall maintain 
 54.27  these reports and make them available for public inspection in 
 54.28  the same manner as the board maintains and makes available other 
 54.29  reports filed with it.  
 54.30     (f) By January 10 of each year in which elections are to be 
 54.31  held the board shall distribute by mail to the members ballots 
 54.32  listing the candidates.  No member may vote for more than one 
 54.33  candidate for each board position to be filled.  A ballot 
 54.34  indicating a vote for more than one person for any position is 
 54.35  void.  No special marking may be used on the ballot to indicate 
 54.36  incumbents.  The last day for mailing ballots to the fund is 
 55.1   January 31.  Terms expire on January 31 of the fourth year, and 
 55.2   positions are vacant until newly elected members are qualified.  
 55.3   The ballot envelopes must be so designed and the ballots counted 
 55.4   in a manner that ensures that each vote is secret.  The 
 55.5   secretary of state shall supervise the elections.  
 55.6      (g) The board of trustees and the executive director shall 
 55.7   undertake their activities consistent with chapter 356A. 
 55.8      Sec. 18.  Minnesota Statutes 2000, section 353.27, 
 55.9   subdivision 2, is amended to read: 
 55.10     Subd. 2.  [EMPLOYEE CONTRIBUTION.] (a) The employee 
 55.11  contribution is an the following applicable percentage of total 
 55.12  salary amount (1) for a "basic member" equal to 8.75 percent of 
 55.13  total salary; and (2) for a "coordinated member" equal to 4.75 
 55.14  percent of total salary.: 
 55.15                           basic program     coordinated program
 55.16  before January 1, 2002          8.75                  4.75  
 55.17  effective January 1, 2002       ....                  ....  
 55.18  effective January 1, 2003       ....                  ....  
 55.19     (b) These contributions must be made by deduction from 
 55.20  salary in the manner provided in subdivision 4.  Where any 
 55.21  portion of a member's salary is paid from other than public 
 55.22  funds, such member's employee contribution must be based on the 
 55.23  total salary received from all sources. 
 55.24     Sec. 19.  Minnesota Statutes 2000, section 353.27, 
 55.25  subdivision 3, is amended to read: 
 55.26     Subd. 3.  [EMPLOYER CONTRIBUTION.] (a) The employer 
 55.27  contribution is an the following applicable percentage of total 
 55.28  salary amount equal to the employee contribution under 
 55.29  subdivision 2.: 
 55.30                          basic program      coordinated program  
 55.31  before January 1, 2002        8.75                  4.75 
 55.32  effective January 1, 2002     ....                  ....   
 55.33  effective January 1, 2003     ....                  ....   
 55.34     (b) This contribution must be made from funds available to 
 55.35  the employing subdivision by the means and in the manner 
 55.36  provided in section 353.28. 
 56.1      Sec. 20.  Minnesota Statutes 2000, section 353.27, 
 56.2   subdivision 4, is amended to read: 
 56.3      Subd. 4.  [EMPLOYER REPORTING REQUIREMENTS; CONTRIBUTIONS; 
 56.4   MEMBER STATUS.] (a) A representative authorized by the head of 
 56.5   each department shall deduct employee contributions from the 
 56.6   salary of each employee who qualifies for membership under this 
 56.7   chapter and remit payment in a manner prescribed by the 
 56.8   executive director for the aggregate amount of the employee 
 56.9   contributions, the employer contributions and the additional 
 56.10  employer contributions to be received within 14 calendar days.  
 56.11  The head of each department or the person's designee shall for 
 56.12  each pay period submit to the association a salary deduction 
 56.13  report in the format prescribed by the executive director.  Data 
 56.14  to be submitted as part of salary deduction reporting must 
 56.15  include, but are not limited to:  
 56.16     (1) the legal names and social security numbers of 
 56.17  employees who are members; 
 56.18     (2) the amount of each employee's salary deduction; 
 56.19     (3) the amount of salary from which each deduction was 
 56.20  made; 
 56.21     (4) the beginning and ending dates of the payroll period 
 56.22  covered and the date of actual payment; and 
 56.23     (5) adjustments or corrections covering past pay periods; 
 56.24  and 
 56.25     (6) the number of compensated hours of each employee during 
 56.26  the payroll period.  
 56.27     (b) Employers must furnish the data required for enrollment 
 56.28  for each new employee who qualifies for membership in the format 
 56.29  prescribed by the executive director.  The required enrollment 
 56.30  data on new employees must be submitted to the association prior 
 56.31  to or concurrent with the submission of the initial employee 
 56.32  salary deduction.  The employer shall also report to the 
 56.33  association all member employment status changes, such as leaves 
 56.34  of absence, terminations, and death, and the effective dates of 
 56.35  those changes, on an ongoing basis for the payroll cycle in 
 56.36  which they occur.  The employer shall furnish data, forms, and 
 57.1   reports as may be required by the executive director for proper 
 57.2   administration of the retirement system.  Before implementing 
 57.3   new or different computerized reporting requirements, the 
 57.4   executive director shall give appropriate advance notice to 
 57.5   governmental subdivisions to allow time for system modifications.
 57.6      (c) Notwithstanding paragraph (a), the association may 
 57.7   provide for less frequent reporting and payments for small 
 57.8   employers. 
 57.9      Sec. 21.  Minnesota Statutes 2000, section 353.27, 
 57.10  subdivision 10, is amended to read: 
 57.11     Subd. 10.  [EMPLOYER EXCLUSION REPORTS.] The head of a 
 57.12  department shall annually furnish the executive director with an 
 57.13  exclusion report listing only those employees in potentially 
 57.14  PERA-eligible positions who were not reported as members of the 
 57.15  association and who worked during the school year for school 
 57.16  employees and calendar year for nonschool employees.  The 
 57.17  department head must certify the accuracy and completeness of 
 57.18  the exclusion report to the association.  The executive director 
 57.19  shall prescribe the manner and forms, including standardized 
 57.20  exclusion codes, to be used by a governmental subdivision in 
 57.21  preparing and filing exclusion reports.  The executive director 
 57.22  shall also check the exclusion report to ascertain whether any 
 57.23  omissions have been made by a department head in the reporting 
 57.24  of new public employees for membership. The executive director 
 57.25  may delegate an association employee under section 353.03, 
 57.26  subdivision 3a, paragraph (b), clause (5), to conduct a field 
 57.27  audit to review the payroll records of a governmental 
 57.28  subdivision. 
 57.29     Sec. 22.  Minnesota Statutes 2000, section 353.27, 
 57.30  subdivision 11, is amended to read: 
 57.31     Subd. 11.  [EMPLOYERS; REQUIRED TO FURNISH REQUESTED 
 57.32  INFORMATION.] All governmental subdivisions shall furnish 
 57.33  promptly such other information relative to the employment 
 57.34  status of all employees or former employees, including but not 
 57.35  limited to payroll abstracts pertaining to all past and present 
 57.36  employees, as may be requested by the association or its 
 58.1   executive director, including schedules of salaries applicable 
 58.2   to various categories of employment, and the number of actual or 
 58.3   estimated compensated hours for employees.  In the event payroll 
 58.4   abstract records have been lost or destroyed, for whatever 
 58.5   reason or in whatever manner, so that such schedules of salaries 
 58.6   cannot be furnished therefrom, the employing governmental 
 58.7   subdivision, in lieu thereof, shall furnish to the association 
 58.8   an estimate of the earnings of any employee or former employee 
 58.9   for any period as may be requested by the association or its 
 58.10  executive director. Should the association receive such 
 58.11  schedules of estimated earnings, the executive director is 
 58.12  hereby authorized to use the same as a basis for making whatever 
 58.13  computations might be necessary for determining obligations of 
 58.14  the employee and employer to the retirement fund.  If estimates 
 58.15  are not furnished by the employer pursuant to the request of the 
 58.16  association or its executive director, the association may 
 58.17  estimate the obligations of the employee and employer to the 
 58.18  retirement fund based upon such records as are in its 
 58.19  possession.  Where payroll abstracts have been lost or 
 58.20  destroyed, the governmental agency need not furnish any 
 58.21  information pertaining to employment prior to July 1, 1963. The 
 58.22  association shall make no estimate of any obligation of any 
 58.23  employee, former employee, or employer covering employment prior 
 58.24  to July 1, 1963. 
 58.25     Sec. 23.  [353.275] [STATE AID FOR PERA-GENERAL.] 
 58.26     (a) Annually, on July 1, $....... is appropriated from the 
 58.27  general fund to the commissioner of finance for transmittal to 
 58.28  the executive director of the public employees retirement 
 58.29  association. 
 58.30     (b) The state aid transmitted under paragraph (a) must be 
 58.31  deposited in the general employees retirement fund upon receipt 
 58.32  and must be credited as an asset of the general employees 
 58.33  retirement plan of the public employees retirement association. 
 58.34     Sec. 24.  Minnesota Statutes 2000, section 353.28, 
 58.35  subdivision 8, is amended to read: 
 58.36     Subd. 8.  If the taxes authorized to be levied under this 
 59.1   section cause the total amount of taxes levied to exceed any 
 59.2   limitation upon the power of a county, city, or town, or school 
 59.3   district to levy taxes, the governmental subdivision concerned, 
 59.4   if it is other than a school district, may levy taxes in excess 
 59.5   of the limitation in such amount as is necessary to meet its 
 59.6   obligations under this section.  The expenditures authorized to 
 59.7   be made under this chapter by any municipality are not included 
 59.8   in computing the cost of government as defined in any home rule 
 59.9   charter of any municipality which employs members covered by the 
 59.10  retirement fund. 
 59.11     Sec. 25.  Minnesota Statutes 2000, section 353.86, 
 59.12  subdivision 1, is amended to read: 
 59.13     Subdivision 1.  [PARTICIPATION.] Volunteer ambulance 
 59.14  service personnel, as defined in section 353.01, subdivision 35, 
 59.15  who are or become members of and participants in the public 
 59.16  employees retirement fund or the public employees police and 
 59.17  fire fund before July 1, 2002, and make contributions to either 
 59.18  of those funds based on compensation for service other than 
 59.19  volunteer ambulance service may elect to participate in that 
 59.20  same fund with respect to compensation received for volunteer 
 59.21  ambulance service, provided that the volunteer ambulance service 
 59.22  is not credited to another public or private pension plan 
 59.23  including the public employees retirement plan established by 
 59.24  chapter 353D and provided further that the volunteer ambulance 
 59.25  service is rendered for the same governmental unit for which the 
 59.26  nonvolunteer ambulance service is rendered. 
 59.27     Sec. 26.  Minnesota Statutes 2000, section 354.05, 
 59.28  subdivision 2, is amended to read: 
 59.29     Subd. 2.  [TEACHER.] (a) "Teacher" means: 
 59.30     (1) a person who renders service as a teacher, supervisor, 
 59.31  principal, superintendent, librarian, nurse, counselor, social 
 59.32  worker, therapist, or psychologist in the public schools of the 
 59.33  state located outside of the corporate limits of the cities of 
 59.34  the first class or in the Minnesota state colleges and 
 59.35  universities system, or in any charitable, penal, or 
 59.36  correctional institutions of a governmental subdivision, or who 
 60.1   is engaged in educational administration in connection with the 
 60.2   state public school system, including the Minnesota state 
 60.3   colleges and universities system, but excluding the University 
 60.4   of Minnesota, whether the position be a public office or an 
 60.5   employment, not including members or officers of any general 
 60.6   governing or managing board or body; 
 60.7      (2) an employee of the teachers retirement association 
 60.8   unless the employee is covered by the Minnesota state retirement 
 60.9   system due to prior employment by that system; 
 60.10     (3) a person who renders teaching service on a part-time 
 60.11  basis and who also renders other services for a single employing 
 60.12  unit.  A person whose teaching service comprises at least 50 
 60.13  percent of the combined employment salary is a member of the 
 60.14  association for all services with the single employing unit.  If 
 60.15  the person's teaching service comprises less than 50 percent of 
 60.16  the combined employment salary, the executive director must 
 60.17  determine whether all or none of the combined service is covered 
 60.18  by the association; or 
 60.19     (4) an employee of a common, independent, or special school 
 60.20  district, an instrumentality of a school district, or a 
 60.21  governmental entity that is comprised wholly of school districts 
 60.22  who are not included in clause (1) other than a person who was a 
 60.23  member of the Minneapolis employees retirement fund on March 1, 
 60.24  2001. 
 60.25     (b) Teacher does not mean: 
 60.26     (1) a person who works for a school or institution as an 
 60.27  independent contractor as defined by the Internal Revenue 
 60.28  Service; 
 60.29     (2) a person employed in subsidized on-the-job training, 
 60.30  work experience or public service employment as an enrollee 
 60.31  under the federal Comprehensive Employment and Training Act from 
 60.32  and after March 30, 1978, unless the person has, as of the later 
 60.33  of March 30, 1978, or the date of employment, sufficient service 
 60.34  credit in the retirement association to meet the minimum vesting 
 60.35  requirements for a deferred retirement annuity, or the employer 
 60.36  agrees in writing on forms prescribed by the executive director 
 61.1   to make the required employer contributions, including any 
 61.2   employer additional contributions, on account of that person 
 61.3   from revenue sources other than funds provided under the federal 
 61.4   Comprehensive Training and Employment Act, or the person agrees 
 61.5   in writing on forms prescribed by the executive director to make 
 61.6   the required employer contribution in addition to the required 
 61.7   employee contribution; 
 61.8      (3) a person holding a part-time adult supplementary 
 61.9   technical college license who renders part-time teaching service 
 61.10  or a customized trainer as defined by the Minnesota state 
 61.11  colleges and universities system in a technical college if (i) 
 61.12  the service is incidental to the regular nonteaching occupation 
 61.13  of the person; and (ii) the applicable technical college 
 61.14  stipulates annually in advance that the part-time teaching 
 61.15  service or customized training service will not exceed 300 hours 
 61.16  in a fiscal year and retains the stipulation in its records; and 
 61.17  (iii) the part-time teaching service or customized training 
 61.18  service actually does not exceed 300 hours in a fiscal year; or 
 61.19     (4) a person exempt from licensure under section 122A.30; 
 61.20     (5) a person who is employed by special school district No. 
 61.21  1 and who was a member of the Minneapolis employees retirement 
 61.22  fund on March 1, 2001; 
 61.23     (6) pipefitters and associated trades personnel employed by 
 61.24  independent school district No. 625, St. Paul, with coverage by 
 61.25  the pipefitters local 455 pension plan under a collective 
 61.26  bargaining agreement who were either first employed after May 1, 
 61.27  1997, or, if first employed before May 2, 1997, elected to be 
 61.28  excluded under Laws 1997, chapter 241, article 2, section 12; or 
 61.29     (7) electrical workers, plumbers, carpenters, and 
 61.30  associated trades personnel employed by independent school 
 61.31  district No. 625, St. Paul, with coverage by the electrical 
 61.32  workers local 110 pension plan, the united association plumbers 
 61.33  local 34 pension plan, or the carpenters local 87 pension plan 
 61.34  under a collective bargaining agreement who were either first 
 61.35  employed after May 1, 2000, or, if first employed before May 2, 
 61.36  2000, elected to be excluded under Laws 2000, chapter 461, 
 62.1   article 7, section 5. 
 62.2      Sec. 27.  [354.411] [TRANSFER OF MEMBERSHIP; TRANSFER OF 
 62.3   LIABILITIES, ASSETS, AND RELEVANT RECORDS.] 
 62.4      Subdivision 1.  [MEMBERSHIP TRANSFER.] Unless excluded from 
 62.5   membership under section 354.05, subdivision 2, active members 
 62.6   of the general employees retirement plan of the public employees 
 62.7   retirement association on June 30, 2001, who are employees of a 
 62.8   common school district, an independent school district, a 
 62.9   special school district, an instrumentality of a school 
 62.10  district, or a governmental entity comprised wholly of school 
 62.11  districts are active members of the teachers retirement 
 62.12  association under this chapter on July 1, 2001, and are not 
 62.13  active members of the general employees retirement plan of the 
 62.14  public employees retirement association under chapter 353. 
 62.15     Subd. 2.  [SERVICE CREDIT TRANSFER.] (a) For every person 
 62.16  transferred under subdivision 1, all past allowable service 
 62.17  credit in the general employees retirement plan of the public 
 62.18  employees retirement association under section 353.01, 
 62.19  subdivision 16, arising from school district or related 
 62.20  employment is allowable and formula service credit under section 
 62.21  354.05, subdivisions 13 and 25. 
 62.22     (b) The executive director of the public employees 
 62.23  retirement association shall certify the amount of service 
 62.24  credit transferred under paragraph (a) for each active member 
 62.25  provided future retirement plan coverage under subdivision 1. 
 62.26     (c) Following the certification under paragraph (b), 
 62.27  effective June 30, 2001, the applicable service credit of 
 62.28  transferred members in the general employees retirement plan of 
 62.29  the public employees retirement association cancels and is 
 62.30  forfeited. 
 62.31     Subd. 3.  [LIABILITY TRANSFER.] The liability to provide 
 62.32  retirement coverage related to the service credit transferred 
 62.33  under subdivision 2, paragraph (a), becomes the liability of the 
 62.34  teachers retirement association as of July 1, 2001, and is no 
 62.35  longer the liability of the general employees retirement plan of 
 62.36  the public employees retirement association as of June 30, 2001. 
 63.1   This liability transfer must be reflected in the actuarial 
 63.2   valuations of the teachers retirement association and the 
 63.3   general employees retirement plan of the public employees 
 63.4   retirement association as of July 1, 2001, every July 1, 
 63.5   thereafter. 
 63.6      Subd. 4.  [ASSET TRANSFER.] The executive director of the 
 63.7   public employees retirement association shall transfer from the 
 63.8   general employees retirement plan of the public employees 
 63.9   retirement association to the executive director of the teachers 
 63.10  retirement association assets, at market value, equal to 74.89 
 63.11  percent of the amount of actuarial accrued liabilities 
 63.12  transferred under subdivision 3.  The executive director of the 
 63.13  teachers retirement association shall deposit the assets 
 63.14  transferred under this subdivision to the teachers retirement 
 63.15  fund.  The transfer may not include a transfer of any amounts 
 63.16  payable or amounts receivable. 
 63.17     Subd. 5.  [RECORDS TRANSFER.] The executive director of the 
 63.18  public employees retirement association shall transfer relevant 
 63.19  records relating to members transferred to teachers retirement 
 63.20  association retirement coverage under subdivision 1. 
 63.21     Subd. 6.  [APPLICABILITY OF CLAIMS.] The teachers 
 63.22  retirement association is the successor in interest for all 
 63.23  claims related to members transferred under subdivision 1.  The 
 63.24  teachers retirement association may assert any applicable 
 63.25  defense in any judicial proceeding which the public employees 
 63.26  retirement association would have otherwise been entitled to 
 63.27  assert with respect to claims related to members transferred 
 63.28  under subdivision 1. 
 63.29     Sec. 28.  Minnesota Statutes 2000, section 356.215, 
 63.30  subdivision 4g, is amended to read: 
 63.31     Subd. 4g.  [AMORTIZATION CONTRIBUTIONS.] (a) In addition to 
 63.32  the exhibit indicating the level normal cost, the actuarial 
 63.33  valuation must contain an exhibit indicating the additional 
 63.34  annual contribution sufficient to amortize the unfunded 
 63.35  actuarial accrued liability.  For funds governed by chapters 3A, 
 63.36  352, 352B, 352C, 353, 354, 354A, and 490, the additional 
 64.1   contribution must be calculated on a level percentage of covered 
 64.2   payroll basis by the established date for full funding in effect 
 64.3   when the valuation is prepared.  For funds governed by chapter 
 64.4   3A, sections 352.90 through 352.951, chapters 352B, 352C, 
 64.5   sections 353.63 through 353.68, and chapters 353C, 354A, and 
 64.6   490, the level percent additional contribution must be 
 64.7   calculated assuming annual payroll growth of 6.5 percent.  For 
 64.8   funds governed by sections 352.01 through 352.86 and chapter 
 64.9   354, the level percent additional contribution must be 
 64.10  calculated assuming an annual payroll growth of five percent.  
 64.11  For the fund governed by sections 353.01 through 353.46, the 
 64.12  level percent additional contribution must be calculated 
 64.13  assuming an annual payroll growth of six percent.  For all other 
 64.14  funds, the additional annual contribution must be calculated on 
 64.15  a level annual dollar amount basis. 
 64.16     (b) For any fund other than the Minneapolis employees 
 64.17  retirement fund and the public employees retirement association 
 64.18  general plan, after the first actuarial valuation date occurring 
 64.19  after June 1, 1989, if there has not been a change in the 
 64.20  actuarial assumptions used for calculating the actuarial accrued 
 64.21  liability of the fund, a change in the benefit plan governing 
 64.22  annuities and benefits payable from the fund, a change in the 
 64.23  actuarial cost method used in calculating the actuarial accrued 
 64.24  liability of all or a portion of the fund, or a combination of 
 64.25  the three, which change or changes by themselves without 
 64.26  inclusion of any other items of increase or decrease produce a 
 64.27  net increase in the unfunded actuarial accrued liability of the 
 64.28  fund, the established date for full funding for the first 
 64.29  actuarial valuation made after June 1, 1989, and each successive 
 64.30  actuarial valuation is the first actuarial valuation date 
 64.31  occurring after June 1, 2020.  
 64.32     (c) For any fund or plan other than the Minneapolis 
 64.33  employees retirement fund and the public employees retirement 
 64.34  association general plan, after the first actuarial valuation 
 64.35  date occurring after June 1, 1989, if there has been a change in 
 64.36  any or all of the actuarial assumptions used for calculating the 
 65.1   actuarial accrued liability of the fund, a change in the benefit 
 65.2   plan governing annuities and benefits payable from the fund, a 
 65.3   change in the actuarial cost method used in calculating the 
 65.4   actuarial accrued liability of all or a portion of the fund, or 
 65.5   a combination of the three, and the change or changes, by 
 65.6   themselves and without inclusion of any other items of increase 
 65.7   or decrease, produce a net increase in the unfunded actuarial 
 65.8   accrued liability in the fund, the established date for full 
 65.9   funding must be determined using the following procedure:  
 65.10     (i) the unfunded actuarial accrued liability of the fund 
 65.11  must be determined in accordance with the plan provisions 
 65.12  governing annuities and retirement benefits and the actuarial 
 65.13  assumptions in effect before an applicable change; 
 65.14     (ii) the level annual dollar contribution or level 
 65.15  percentage, whichever is applicable, needed to amortize the 
 65.16  unfunded actuarial accrued liability amount determined under 
 65.17  item (i) by the established date for full funding in effect 
 65.18  before the change must be calculated using the interest 
 65.19  assumption specified in subdivision 4d in effect before the 
 65.20  change; 
 65.21     (iii) the unfunded actuarial accrued liability of the fund 
 65.22  must be determined in accordance with any new plan provisions 
 65.23  governing annuities and benefits payable from the fund and any 
 65.24  new actuarial assumptions and the remaining plan provisions 
 65.25  governing annuities and benefits payable from the fund and 
 65.26  actuarial assumptions in effect before the change; 
 65.27     (iv) the level annual dollar contribution or level 
 65.28  percentage, whichever is applicable, needed to amortize the 
 65.29  difference between the unfunded actuarial accrued liability 
 65.30  amount calculated under item (i) and the unfunded actuarial 
 65.31  accrued liability amount calculated under item (iii) over a 
 65.32  period of 30 years from the end of the plan year in which the 
 65.33  applicable change is effective must be calculated using the 
 65.34  applicable interest assumption specified in subdivision 4d in 
 65.35  effect after any applicable change; 
 65.36     (v) the level annual dollar or level percentage 
 66.1   amortization contribution under item (iv) must be added to the 
 66.2   level annual dollar amortization contribution or level 
 66.3   percentage calculated under item (ii); 
 66.4      (vi) the period in which the unfunded actuarial accrued 
 66.5   liability amount determined in item (iii) is amortized by the 
 66.6   total level annual dollar or level percentage amortization 
 66.7   contribution computed under item (v) must be calculated using 
 66.8   the interest assumption specified in subdivision 4d in effect 
 66.9   after any applicable change, rounded to the nearest integral 
 66.10  number of years, but not to exceed 30 years from the end of the 
 66.11  plan year in which the determination of the established date for 
 66.12  full funding using the procedure set forth in this clause is 
 66.13  made and not to be less than the period of years beginning in 
 66.14  the plan year in which the determination of the established date 
 66.15  for full funding using the procedure set forth in this clause is 
 66.16  made and ending by the date for full funding in effect before 
 66.17  the change; and 
 66.18     (vii) the period determined under item (vi) must be added 
 66.19  to the date as of which the actuarial valuation was prepared and 
 66.20  the date obtained is the new established date for full funding.  
 66.21     (d) For the Minneapolis employees retirement fund, the 
 66.22  established date for full funding is June 30, 2020. 
 66.23     (e) For the public employees retirement association general 
 66.24  plan, the established date for full funding is June 30, 2031. 
 66.25     (f) For the retirement plans for which the annual actuarial 
 66.26  valuation indicates an excess of valuation assets over the 
 66.27  actuarial accrued liability, the valuation assets in excess of 
 66.28  the actuarial accrued liability must be recognized as a 
 66.29  reduction in the current contribution requirements by an amount 
 66.30  equal to the amortization of the excess expressed as a level 
 66.31  percentage of pay over a 30-year period beginning anew with each 
 66.32  annual actuarial valuation of the plan. 
 66.33     Sec. 29.  [IMPLEMENTATION PLAN; MAJOR STATEWIDE RETIREMENT 
 66.34  SYSTEM ADMINISTRATIVE SERVICES CONSOLIDATION.] 
 66.35     (a) Based on the July 15, 2001, report required under Laws 
 66.36  1999, chapter 222, article 22, section 5, the executive 
 67.1   directors of the Minnesota state retirement system, the public 
 67.2   employees retirement association, and the teachers retirement 
 67.3   association jointly shall prepare a report detailing the 
 67.4   implementation steps that would be necessary to consolidate the 
 67.5   administrations of the three systems into a single 
 67.6   administrative structure if the legislature subsequently 
 67.7   determines that such a consolidation would be in the best 
 67.8   interests of the state, its taxpayers, and its public employees. 
 67.9      (b) The report must include the draft proposed legislation 
 67.10  that would be required to effect an administrative consolidation 
 67.11  as well as a detailed schedule and timetable of the completion 
 67.12  steps for a consolidation. 
 67.13     (c) The report must be filed by February 15, 2002, with the 
 67.14  chair of the legislative commission on pensions and retirement, 
 67.15  the chair of the senate committee on state and local government 
 67.16  operations, and the chair of the house committee on government 
 67.17  operations and veterans affairs policy. 
 67.18     Sec. 30.  [IMPLEMENTATION PLAN; AGGREGATION OF TEACHER 
 67.19  RETIREMENT PLANS.] 
 67.20     (a) The executive director of the teachers retirement 
 67.21  association, the secretary of the Duluth teachers retirement 
 67.22  fund association, the executive director of the Minneapolis 
 67.23  teachers retirement fund association, and the secretary of the 
 67.24  St. Paul teachers retirement fund association jointly shall 
 67.25  prepare a report detailing the implementation steps that would 
 67.26  be necessary to aggregate the benefit plans, retirement funds, 
 67.27  and governance structures of the four teacher retirement plans 
 67.28  into a single Minnesota public education employees retirement 
 67.29  plan and system if the legislature subsequently determines that 
 67.30  such an aggregation would be in the best interests of the state, 
 67.31  its taxpayers, and the public education community.  
 67.32     (b) In preparing the report, the pension plan 
 67.33  administrators must establish and consult with a task force.  
 67.34  The task force must consist of representatives of the affected 
 67.35  employing units and representatives of the collective bargaining 
 67.36  organizations representing members of the affected pension plans.
 68.1      (c) The report must include the draft proposed legislation 
 68.2   that would be required to effect the public education employees 
 68.3   retirement plan and system aggregation as well as a detailed 
 68.4   schedule and timetable of the completion steps for an 
 68.5   aggregation. 
 68.6      (d) The report must be filed by February 15, 2002, with the 
 68.7   chair of the legislative commission on pensions and retirement, 
 68.8   the chair of the senate committee on state and local government 
 68.9   operations, and the chair of the house committee on government 
 68.10  operations and veterans affairs policy. 
 68.11     Sec. 31.  [EFFECTIVE DATE.] 
 68.12     (a) Sections 1, 2, 5 as it relates to the exclusion of 
 68.13  school district employees, 7, 16, 17, 21, 24, 26, and 27 are 
 68.14  effective June 30, 2001. 
 68.15     (b) Sections 3, 4, 5, 6, 8, 9, 10, 11, 12, 14, and 25 are 
 68.16  effective July 1, 2002. 
 68.17     (c) Section 28 is effective for actuarial valuations 
 68.18  prepared after June 1, 2001. 
 68.19     (d) Sections 13, 15, 18, 19, 20, 22, and 23 are effective 
 68.20  July 1, 2001.  
 68.21     (e) Sections 29 and 30 are effective on the day following 
 68.22  final enactment. 
 68.23                             ARTICLE 4
 68.24           CLOSED CHARTER SCHOOL RETIREMENT CONTRIBUTIONS
 68.25     Section 1.  [STATE PAYMENT OF CERTAIN UNPAID CHARTER SCHOOL 
 68.26  RETIREMENT CONTRIBUTIONS.] 
 68.27     Subdivision 1.  [UNPAID CONTRIBUTIONS.] (a) The state of 
 68.28  Minnesota shall make any unpaid employee and employer 
 68.29  contributions to the applicable retirement association for 
 68.30  teaching or other service in a designated charter school which 
 68.31  closed without having paid such contributions to the retirement 
 68.32  association.  
 68.33     (b) The chief administrative officer of the retirement 
 68.34  association shall certify to the commissioner of finance the 
 68.35  amount of accrued contributions, plus applicable interest, which 
 68.36  were not paid by each designated charter school before its 
 69.1   closure.  The commissioner of finance shall remit directly to 
 69.2   the retirement association the amounts certified under this 
 69.3   section.  The applicable retirement association shall credit 
 69.4   employee contribution payments to the applicable member accounts 
 69.5   and shall credit to applicable members allowable and formula 
 69.6   service and covered salary for the period when the teaching or 
 69.7   other service was actually performed in the charter school. 
 69.8   State payments representing unpaid employee contributions must 
 69.9   be considered accumulated employee or member deductions for 
 69.10  purposes of Minnesota Statutes, section 353.34; 354.49; or 
 69.11  354A.37. 
 69.12     Subd. 2.  [COVERED RETIREMENT ASSOCIATIONS.] This section 
 69.13  applies to the following public retirement associations 
 69.14  providing retirement coverage for employees in charter schools: 
 69.15     (1) teachers retirement association; 
 69.16     (2) Minneapolis teachers retirement fund association; 
 69.17     (3) St. Paul teachers retirement fund association; 
 69.18     (4) Duluth teachers retirement fund association; and 
 69.19     (5) public employees retirement association. 
 69.20     Subd. 3.  [DESIGNATED CLOSED CHARTER SCHOOLS.] This section 
 69.21  applies to the Frederick Douglass charter school and any other 
 69.22  charter school that has closed and that is approved by the 
 69.23  legislative commission on pensions and retirement for coverage 
 69.24  by this section.  
 69.25     Sec. 2.  [CONTINUING RECOVERY AUTHORITY.] 
 69.26     Nothing in section 1 relieves the sponsor of a closed 
 69.27  charter school or the operator of a closed charter school from 
 69.28  any financial responsibility that those parties may have to pay 
 69.29  unpaid employee or employer contributions to applicable public 
 69.30  retirement plans.  The commissioner of finance shall undertake 
 69.31  all reasonable efforts to recover these amounts.  Any recovered 
 69.32  amounts must be deposited in the general fund. 
 69.33     Sec. 3.  [APPROPRIATION.] 
 69.34     $....... is appropriated from charter school lease aid for 
 69.35  the purposes of section 1, to be available on the day following 
 69.36  final enactment. 
 70.1      Sec. 4.  [EFFECTIVE DATE.] 
 70.2      Sections 1, 2, and 3 are effective the day following final 
 70.3   enactment. 
 70.4                              ARTICLE 5
 70.5             MINNEAPOLIS FIREFIGHTERS RELIEF ASSOCIATION
 70.6                BENEFIT PLAN CODIFICATION AND REVISION
 70.7      Section 1.  [423C.01] [MINNEAPOLIS FIREFIGHTERS RELIEF 
 70.8   ASSOCIATION; DEFINITIONS.] 
 70.9      Subdivision 1.  [TERMS.] For purposes of this chapter, 
 70.10  unless the context clearly indicates otherwise, the terms 
 70.11  defined in this section have the meanings given them. 
 70.12     Subd. 2.  [ACTIVE MEMBER.] "Active member" means a person 
 70.13  who was hired and duly appointed by the city of Minneapolis 
 70.14  before June 15, 1980, as a firefighter who is regularly entered 
 70.15  on the fire department payroll and who serves on active duty. 
 70.16     Subd. 3.  [ACTIVE MEMBER PERCENTAGE.] "Active member 
 70.17  percentage" means the total number of units accrued by active 
 70.18  members divided by the sum of the total number of units to which 
 70.19  eligible members are entitled and active members have accrued. 
 70.20     Subd. 4.  [ACTUARIAL EQUIVALENT OR ACTUARIALLY 
 70.21  EQUIVALENT.] "Actuarial equivalent" or "actuarially equivalent" 
 70.22  means the condition of one annuity or benefit having an equal 
 70.23  actuarial present value as another annuity or benefit determined 
 70.24  as of a given date at a specified age with each actuarial 
 70.25  present value based on the appropriate mortality table adopted 
 70.26  by the board based on the experience of the special fund and 
 70.27  approved by the actuary retained by the legislative commission 
 70.28  on pensions and retirement and using the applicable 
 70.29  preretirement or postretirement interest rate assumptions 
 70.30  specified in section 356.216. 
 70.31     Subd. 5.  [AGE.] "Age" means a person's age at the person's 
 70.32  latest birthday. 
 70.33     Subd. 6.  [ANNUAL POSTRETIREMENT ADJUSTMENT.] "Annual 
 70.34  postretirement adjustment" means the payment of a lump-sum, 
 70.35  postretirement benefit pursuant to section 423C.06, subdivision 
 70.36  1, to an eligible member on June 1 following the determination 
 71.1   date in any year. 
 71.2      Subd. 7.  [ASSOCIATION.] "Association" means the 
 71.3   Minneapolis firefighters relief association.  
 71.4      Subd. 8.  [BOARD.] "Board" means the board established in 
 71.5   section 423C.03 to govern the association. 
 71.6      Subd. 9.  [CITY.] "City" means the city of Minneapolis. 
 71.7      Subd. 10.  [DEFERRED MEMBER.] "Deferred member" means a 
 71.8   person who served on active duty and was regularly entered on 
 71.9   the fire department payroll and separated from active service 
 71.10  prior to attaining 50 years of age and is entitled to receive a 
 71.11  service pension upon reaching age 50 under the law existing at 
 71.12  the time the member separated from active service for at least 
 71.13  five years. 
 71.14     Subd. 11.  [DEPENDENT.] "Dependent" means: 
 71.15     (1) a biological or adopted child of a deceased, active, or 
 71.16  retired member who is unmarried and under the age of 18; 
 71.17     (2) a biological or adopted child of a deceased, active, or 
 71.18  retired member who is between the ages of 18 and 22 and is 
 71.19  enrolled full time at an accredited educational institution 
 71.20  approved by the board; or 
 71.21     (3) a biological child of an active or retired member 
 71.22  conceived during the active or retired member's lifetime and 
 71.23  born after the active or retired member's death. 
 71.24     Subd. 12.  [DETERMINATION DATE.] "Determination date" means 
 71.25  December 31 of each year. 
 71.26     Subd. 13.  [DISABILITY.] "Disability" has the meaning 
 71.27  specified in the bylaws of the relief association on April 1, 
 71.28  2001. 
 71.29     Subd. 14.  [DISCHARGE.] "Discharge" means a complete 
 71.30  separation from and termination of active service as a member of 
 71.31  the fire department. 
 71.32     Subd. 15.  [ELIGIBLE MEMBER.] "Eligible member" means: 
 71.33     (1) for purposes of section 423C.06, subdivision 1, a 
 71.34  person, including a service pensioner, a disability pensioner, a 
 71.35  survivor, or dependent of a deceased active member, service 
 71.36  pensioner, or disability pensioner, who received a pension or 
 72.1   benefit from the relief association during the 12 months before 
 72.2   the determination date.  A person who received a pension or 
 72.3   benefit for the entire 12 months before the determination date 
 72.4   is eligible for a full annual postretirement payment.  A person 
 72.5   who received a pension or benefit for less than 12 months before 
 72.6   the determination date is eligible for a prorated annual 
 72.7   postretirement payment; and 
 72.8      (2) for purposes of section 423C.06, subdivision 4, a 
 72.9   person who receives a service, survivor, or disability pension 
 72.10  payable from the special fund of the association. 
 72.11     Subd. 16.  [ENROLLED FULL TIME.] "Enrolled full time" means 
 72.12  the situation of an individual who is in full-time attendance as 
 72.13  a student at an educational institution, as determined by the 
 72.14  board of trustees of the relief association in light of the 
 72.15  standards and practices of the school involved.  A person who is 
 72.16  paid by the person's employer while attending school at the 
 72.17  request of that employer may not be considered to be a full-time 
 72.18  student.  A person may be considered a full-time student during 
 72.19  a period of up to four months of nonattendance during any 12 
 72.20  month period if the person shows to the satisfaction of the 
 72.21  board of trustees that the person intends to continue in 
 72.22  full-time school attendance immediately upon the conclusion of 
 72.23  the nonattendance period. 
 72.24     Subd. 17.  [EXCESS INVESTMENT INCOME.] "Excess investment 
 72.25  income" means the amount, if any, by which the time-weighted 
 72.26  total rate of return earned by the special fund in the prior 
 72.27  five fiscal years has exceeded the actual percentage increase in 
 72.28  the current monthly salary of a first grade firefighter in the 
 72.29  most recent fiscal year plus two percent.  The excess investment 
 72.30  income must be expressed as a dollar amount and may not exceed 
 72.31  one percent of the total assets of the special fund except when 
 72.32  the actuarial value of assets of the special fund, according to 
 72.33  the most recent annual actuarial valuation prepared in 
 72.34  accordance with sections 356.215 and 356.216, is greater than 
 72.35  102 percent of its actuarial accrued liabilities, in which case 
 72.36  the amount must not exceed 1.5 percent of the assets of the 
 73.1   special fund.  
 73.2      Subd. 18.  [FIRE DEPARTMENT.] "Fire department" means the 
 73.3   Minneapolis fire department. 
 73.4      Subd. 19.  [FUND.] "Fund" means the special fund of the 
 73.5   relief association. 
 73.6      Subd. 20.  [NET EXCESS ASSET AMOUNT PAYMENT.] "Net excess 
 73.7   asset amount payment" means the payment of an additional 
 73.8   postretirement payment under section 423C.06, subdivision 4, to 
 73.9   an eligible member on June 1 following the determination date in 
 73.10  the given year. 
 73.11     Subd. 21.  [NET TOTAL EXCESS ASSET AMOUNT.] "Net total 
 73.12  excess asset amount" means the total excess asset amount stated 
 73.13  in dollars and multiplied by one minus the active member 
 73.14  percentage. 
 73.15     Subd. 22.  [PERIOD OF SERVICE.] "Period of service" means: 
 73.16     (1) any service rendered by a firefighter for any calendar 
 73.17  month when the member receives salary from which deductions are 
 73.18  made, deposited, and credited to the special fund.  Leaves of 
 73.19  absence of more than 90 days, except those granted because of 
 73.20  disability due to sickness or accident or to enable a member to 
 73.21  accept an appointive position in the fire department, shall be 
 73.22  excluded in computing a member's period of service; 
 73.23     (2) any period in which the member, after entering the fire 
 73.24  department, leaves to either enter the military forces of the 
 73.25  United States in a time of war or national emergency and 
 73.26  subsequently receives an honorable discharge from the military 
 73.27  or renders fire prevention services to the United States 
 73.28  government in a time of war or national emergency, provided the 
 73.29  member who serves either applies for reinstatement in or resumes 
 73.30  active duty in the fire department within six months.  During 
 73.31  any period of military or fire prevention service, the 
 73.32  individual shall not be considered an active member.  Any period 
 73.33  of service a member qualifies for under this clause is limited 
 73.34  as follows: 
 73.35     (i) credit shall be granted for service rendered subsequent 
 73.36  to July 1, 1961, but the credit shall not exceed six calendar 
 74.1   years; 
 74.2      (ii) no credit shall be granted for service rendered 
 74.3   subsequent to July 1, 1961, if the period of service rendered 
 74.4   prior to July 1, 1961, equals or exceeds six calendar years; and 
 74.5      (iii) if the period of service prior to July 1, 1961, is 
 74.6   less than six calendar years, credit for service subsequent to 
 74.7   July 1, 1961, shall be added to the prior service, but in no 
 74.8   case shall total service credit exceed six calendar years. 
 74.9      Subd. 23.  [RETIRED MEMBER.] "Retired member" means a 
 74.10  former active member who has terminated active service with the 
 74.11  fire department and is entitled to receive a pension or benefit 
 74.12  under this chapter or any predecessor law. 
 74.13     Subd. 24.  [RELIEF ASSOCIATION.] "Relief association" means 
 74.14  the Minneapolis firefighters relief association. 
 74.15     Subd. 25.  [SURVIVING SPOUSE MEMBER.] "Surviving spouse 
 74.16  member" means a person who was: 
 74.17     (1) legally married to, and residing with, an active, 
 74.18  deferred, or retired member both during the time the member was 
 74.19  regularly entered on the payroll and serving on active duty in 
 74.20  the fire department and at the time of the member's death; 
 74.21     (2) not in a common law marriage; and 
 74.22     (3) in the event the person was married to a retired or 
 74.23  deferred member, the person was married to that retired or 
 74.24  deferred member for at least two years prior to the member's 
 74.25  discharge from the fire department. 
 74.26     Subd. 26.  [TIME-WEIGHTED TOTAL RATE OF 
 74.27  RETURN.] "Time-weighted total rate of return" means the 
 74.28  percentage amount determined by using the formula or formulas 
 74.29  established by the state board of investment under section 
 74.30  11A.04, clause (11), and in effect on January 1, 1987. 
 74.31     Subd. 27.  [TOTAL EXCESS ASSET AMOUNT.] (a) "Total excess 
 74.32  asset amount" means the difference, if positive, expressed in 
 74.33  dollars, between the special fund's market value of assets after 
 74.34  any deductions required by section 423C.06, subdivision 3, and 
 74.35  110 percent of the actuarial accrued liabilities based on the 
 74.36  actuarial valuation indicated in paragraph (b). 
 75.1      (b) The total excess asset amount in paragraph (a) exists 
 75.2   if the actuarial liability funding ratio, according to the most 
 75.3   recent annual actuarial valuation of the special fund prepared 
 75.4   in accordance with sections 69.77, 356.215, and 356.216, with 
 75.5   adjustments required by section 423C.06, subdivision 3, equals 
 75.6   or exceeds 110 percent. 
 75.7      Subd. 28.  [UNIT.] "Unit" means 1/80 of the maximum monthly 
 75.8   salary of a first grade firefighter on the first day of the 
 75.9   month in which the pension benefits provided by this chapter are 
 75.10  paid. 
 75.11     Sec. 2.  [423C.02] [MINNEAPOLIS FIREFIGHTERS RELIEF 
 75.12  ASSOCIATION.] 
 75.13     Subdivision 1.  [CREATION.] The active and retired members 
 75.14  of the fire department and their surviving spouses shall 
 75.15  maintain the association.  The association shall be duly 
 75.16  incorporated under chapter 317A.  The corporation shall have 
 75.17  perpetual corporate existence.  The association shall create, 
 75.18  maintain, and administer those funds and accounts as set forth 
 75.19  in section 423C.04 for the benefit of its members, surviving 
 75.20  spouses, and dependents.  The sources of revenue for each fund 
 75.21  and account are governed by section 423C.04.  The authorized 
 75.22  disbursements from each fund and account are governed by 
 75.23  sections 423C.04, 423C.05, and 423C.06. 
 75.24     Subd. 2.  [MEMBERSHIP.] Active members, deferred members, 
 75.25  retired members, and surviving spouse members as defined in 
 75.26  section 423C.01 are members of the association. 
 75.27     Subd. 3.  [MANAGEMENT OF ASSOCIATION.] The board created in 
 75.28  section 423C.03 shall manage, control, and operate the 
 75.29  association, including the funds and accounts set forth in 
 75.30  section 423C.04, according to this chapter, other applicable 
 75.31  law, and the association's articles of incorporation and its 
 75.32  bylaws.  Notwithstanding section 423A.01, subdivision 2, or any 
 75.33  other law to the contrary, the board shall continue to govern 
 75.34  the association until there are fewer than 100 members receiving 
 75.35  benefits under this chapter.  Thereafter, the special fund shall 
 75.36  become a trust fund according to section 423A.01, subdivision 2. 
 76.1      Subd. 4.  [DISPOSITION OF ASSETS UPON CONCLUSION OF BENEFIT 
 76.2   PAYMENTS.] Upon the death of the last benefit recipient and the 
 76.3   certification by the chief administrative officer of the city to 
 76.4   the state auditor of the absence of any remaining person 
 76.5   entitled to a benefit under this chapter, all assets of the 
 76.6   association or trust fund, whichever applies, shall revert to 
 76.7   the city.  The city shall only use these assets for firefighting 
 76.8   expenditure purposes. 
 76.9      Sec. 3.  [423C.03] [BOARD MEMBERSHIP; ELECTIONS; DUTIES; 
 76.10  COMPENSATION; BOND; MEETINGS; POWERS.] 
 76.11     Subdivision 1.  [BOARD COMPOSITION AND ELECTIONS.] The 
 76.12  board shall consist of two persons appointed by the city and ten 
 76.13  other members selected by the members.  Elections for active and 
 76.14  retired positions on the board shall be conducted pursuant to 
 76.15  the association's bylaws.  
 76.16     Subd. 2.  [BOARD OFFICERS.] The officers of the association 
 76.17  shall consist of a president, one or more vice-presidents, an 
 76.18  executive secretary, a treasurer, an assistant executive 
 76.19  secretary, and an assistant treasurer.  Only elected members of 
 76.20  the board are eligible to be officers.  Officers shall have 
 76.21  those duties and responsibilities as set forth in this chapter, 
 76.22  other applicable law, and the association's bylaws.  Officers 
 76.23  shall be compensated as provided in subdivision 3.  All officers 
 76.24  shall be elected in even years at the association's annual 
 76.25  meeting.  Officers shall hold their office for a term of two 
 76.26  years unless they are removed from the board before their 
 76.27  two-year term expires. 
 76.28     Subd. 3.  [COMPENSATION OF OFFICERS AND BOARD 
 76.29  MEMBERS.] Notwithstanding any other law to the contrary, the 
 76.30  association may provide for payment of the following salaries to 
 76.31  its officers and board members: 
 76.32     (1) the executive secretary may receive a salary not 
 76.33  exceeding 30 percent of the maximum salary of a first grade 
 76.34  firefighter; 
 76.35     (2) the president may receive a salary not exceeding ten 
 76.36  percent of the maximum salary of a first grade firefighter; and 
 77.1      (3) all other elected members of the board may receive a 
 77.2   salary not exceeding 2.5 percent of the maximum salary of a 
 77.3   first grade firefighter. 
 77.4      Subd. 4.  [BOND FOR EXECUTIVE SECRETARY AND TREASURER.] (a) 
 77.5   The executive secretary and the treasurer must furnish to the 
 77.6   relief association a corporate bond for the faithful performance 
 77.7   of the duties of that office in an amount as the board of 
 77.8   trustees from time to time may determine, subject to the minimum 
 77.9   amount specified in section 69.051, subdivision 2. 
 77.10     (b) The relief association must pay the premiums on these 
 77.11  bonds from the general fund of the relief association. 
 77.12     Subd. 5.  [MEETINGS.] Each December, the board shall hold 
 77.13  an annual meeting.  All other meetings of the board shall be 
 77.14  held as provided in the association's articles or bylaws.  Board 
 77.15  members may participate in a board meeting by any means of 
 77.16  communication through which the trustee, other board members 
 77.17  participating, and all other board members physically present at 
 77.18  the meeting may simultaneously hear each other during the 
 77.19  meeting.  Participating in a meeting by these means is the same 
 77.20  thing as being physically present at the meeting.  
 77.21     Subd. 6.  [ADDITIONAL BOARD POWERS.] In addition to the 
 77.22  powers granted the board by this chapter, chapter 317A, other 
 77.23  applicable state and federal law, and its articles and bylaws, 
 77.24  the board shall authorize and create a board of examiners.  
 77.25     The board of examiners shall investigate and make a report 
 77.26  on all applications for disability pensions and make 
 77.27  recommendations as to the amount to be paid to each applicant; 
 77.28  investigate and make report on all disability pensioners, and 
 77.29  make recommendations as to the amount of pension to be paid to 
 77.30  them, from year to year; and investigate and report on all 
 77.31  applications for service pensions, and claims for relief.  This 
 77.32  board shall consist of a competent physician selected by the 
 77.33  association, and at least three members of the relief 
 77.34  association on active duty with the fire department. 
 77.35     Sec. 4.  [423C.04] [ASSOCIATION FUNDS AND ACCOUNTS.] 
 77.36     Subdivision 1.  [DUTIES.] The association shall create, 
 78.1   maintain, and administer the funds and accounts in this 
 78.2   section.  The sources of revenue and authorized disbursements of 
 78.3   each fund and account are governed by this section. 
 78.4      Subd. 2.  [SPECIAL FUND; PURPOSE AND SOURCES OF 
 78.5   REVENUE.] (a) The special fund may only be used to pay for 
 78.6   defined and contingent benefits as set forth in sections 423C.05 
 78.7   and 423C.06; compensation for officers and board members as set 
 78.8   forth in section 423C.03, subdivision 3; and expenses of 
 78.9   officers and employees of the association in connection with the 
 78.10  protection of the special fund, and expenses of operating, 
 78.11  administering, and maintaining the association as authorized by 
 78.12  this chapter, section 69.80, or other applicable law.  
 78.13     (b) The special fund is derived from the following sources: 
 78.14     (1) receipts from the state, including, but not limited to, 
 78.15  any fire state aid, any fire insurance premium surcharge amount, 
 78.16  or any additional amortization state aid; 
 78.17     (2) all money derived from taxation by the city under 
 78.18  section 69.77 for the support of the association and for the 
 78.19  payment of benefits set forth in sections 423C.05 and 423C.06; 
 78.20     (3) an amount equal to the minimum percentage specified in 
 78.21  section 69.77, subdivision 2a, of the salary of a first grade 
 78.22  firefighter deducted from the monthly salary of each active 
 78.23  member; and 
 78.24     (4) the proceeds of the investment of special fund assets. 
 78.25     Subd. 3.  [GENERAL FUND.] The general fund is separate and 
 78.26  distinct from the special fund.  The general fund may, 
 78.27  consistent with applicable law, be expended for those purposes 
 78.28  deemed appropriate by the relief association.  The city finance 
 78.29  officer shall deduct from each active member's biweekly payroll 
 78.30  check a sum equal to one-half of one percent of the maximum 
 78.31  biweekly salary of a first grade firefighter.  This sum shall be 
 78.32  forwarded to the association's treasurer and deposited in the 
 78.33  general fund.  The general fund shall also consist of receipts 
 78.34  from private sources, such as gifts, charges, fundraising 
 78.35  projects, and dues paid by members; investment of, earnings on, 
 78.36  and interest of the general fund; and all other sources.  Money 
 79.1   received from other sources may also be deposited in the general 
 79.2   fund. 
 79.3      Subd. 4.  [HEALTH INSURANCE ACCOUNTS.] Notwithstanding any 
 79.4   law to the contrary, contributions of active members of the 
 79.5   association with at least 25 years of service made after the 
 79.6   25th year of service must be deposited in a separate account and 
 79.7   used to pay health care costs of the individual member upon 
 79.8   retirement.  The board shall adopt rules regarding the frequency 
 79.9   and amounts of distributions from these accounts.  A member with 
 79.10  an account established pursuant to this section is entitled, 
 79.11  upon retirement or disability, to receive periodic distributions 
 79.12  from the account, in the amount and with the frequency specified 
 79.13  by the retiring member consistent with the board's rules. 
 79.14     Sec. 5.  [423C.05] [DEFINED BENEFITS.] 
 79.15     Subdivision 1.  [DUTIES.] The association is authorized to 
 79.16  and shall pay the benefits in this section to its members in 
 79.17  accordance with this section.  All benefits authorized in this 
 79.18  section shall be paid from the association's special fund. 
 79.19     Subd. 2.  [SERVICE PENSION.] (a) An active member who has 
 79.20  performed duty for the fire department for five years or more, 
 79.21  upon written application after retiring from duty and reaching 
 79.22  at least age 50, is entitled to be paid monthly for life a 
 79.23  service pension under paragraph (b). 
 79.24     (b) Based on the percentage that the actuarial value of 
 79.25  assets of the special fund equal to the actuarial accrued 
 79.26  liabilities of the special fund according to the most recent 
 79.27  annual actuarial valuation of the relief association prepared in 
 79.28  accordance with sections 356.215 and 356.216, the amount of the 
 79.29  service pension is as follows: 
 79.30                              service   
 79.31                              pension
 79.32                              payable          service  
 79.33               service        if greater       pension
 79.34  length of    pension        than 89.99       payable if  
 79.35  allowable    payable if     percent and      greater  
 79.36  service      under 90       less than        than 92.49  
 80.1   credit       percent        92.5 percent     percent  
 80.2    5 years         -            8.0 units       8.0 units 
 80.3    6 years         -            9.6 units       9.6 units 
 80.4    7 years         -           11.2 units      11.2 units 
 80.5    8 years         -           12.8 units      12.8 units 
 80.6    9 years         -           14.4 units      14.4 units 
 80.7   10 years    16.0 units       16.0 units      16.0 units
 80.8   11 years    17.6 units       17.6 units      17.6 units 
 80.9   12 years    19.2 units       19.2 units      19.2 units  
 80.10  13 years    20.8 units       20.8 units      20.8 units  
 80.11  14 years    22.4 units       22.4 units      22.4 units  
 80.12  15 years    24.0 units       24.0 units      24.0 units 
 80.13  16 years    25.6 units       25.6 units      25.6 units 
 80.14  17 years    27.2 units       27.2 units      27.2 units 
 80.15  18 years    28.8 units       28.8 units      28.8 units 
 80.16  19 years    30.4 units       30.4 units      30.4 units 
 80.17  20 years    33.0 units       33.5 units      34.0 units 
 80.18  21 years    34.6 units       35.1 units      35.6 units 
 80.19  22 years    36.2 units       37.7 units      37.2 units 
 80.20  23 years    37.8 units       38.3 units      38.8 units 
 80.21  24 years    39.4 units       39.9 units      40.4 units 
 80.22  25 years or 
 80.23     more     41.0 units       41.5 units      42.0 units
 80.24     (c) A member entitled to a benefit under this subdivision 
 80.25  may elect to have it paid as an optional retirement annuity 
 80.26  pursuant to the conditions set forth in subdivision 8.  A member 
 80.27  receiving a benefit pursuant to subdivision 5 or 6 shall not 
 80.28  simultaneously be entitled to a benefit under this subdivision. 
 80.29     Subd. 3.  [CALCULATION OF SERVICE PENSION FOR DEFERRED 
 80.30  MEMBERS.] An association member who has performed services for 
 80.31  the fire department for five years or more but has not reached 
 80.32  the age of 50 years shall be eligible to retire from the 
 80.33  department, without forfeiting service pension rights.  The 
 80.34  member shall, upon application, be placed on the association's 
 80.35  deferred pension roll.  The association shall, upon board 
 80.36  approval, pay the pension of any member on the deferred pension 
 81.1   roll who has attained 50 years of age from the date the 
 81.2   application is approved.  The pension shall be paid in 
 81.3   accordance with the schedule in subdivision 2.  Any person 
 81.4   making this application waives all other rights, claims, or 
 81.5   demands against the association for any cause that may have 
 81.6   arisen from or that may be attributable to the person's service 
 81.7   in the fire department.  A member entitled to a benefit under 
 81.8   this subdivision may elect to have the benefit paid as an 
 81.9   optional retirement annuity pursuant to the conditions set forth 
 81.10  in subdivision 7.  
 81.11     Subd. 4.  [TEMPORARY DISABILITY PENSION.] An active member 
 81.12  who, by sickness or accident, becomes temporarily disabled from 
 81.13  performing firefighter duties for the fire department shall be 
 81.14  entitled to a temporary disability pension.  No allowance for 
 81.15  disability shall be made unless notice of the disability and an 
 81.16  application for benefits is made by or on behalf of the disabled 
 81.17  member within 90 days after the beginning of the disability.  
 81.18  This application shall include a certificate from a qualified 
 81.19  medical professional setting forth the cause, nature, and extent 
 81.20  of the disability.  This certificate must also conclude that the 
 81.21  disability was incurred or sustained while the member was in the 
 81.22  service of the fire department.  The board may appoint a board 
 81.23  of examiners pursuant to section 423C.03, subdivision 6, to 
 81.24  investigate and report on an application for benefits pursuant 
 81.25  to this section and make recommendations as to eligibility and 
 81.26  the benefit amount to be paid.  A member entitled to a 
 81.27  disability pension shall receive benefits in the amount and 
 81.28  manner determined by the board. 
 81.29     Subd. 5.  [SERVICE-RELATED PERMANENT DISABILITY 
 81.30  PENSION.] An active member who becomes permanently disabled as 
 81.31  the result of a service-related disease or injury shall, upon 
 81.32  application and approval of the board, be entitled to a pension 
 81.33  of 42 units or in the amount determined under subdivision 8.  
 81.34  The application for service-related permanent disability shall 
 81.35  include a certificate from a qualified medical professional 
 81.36  setting forth the permanent nature of the disability or disease 
 82.1   and that it was service related.  The board may appoint a board 
 82.2   of examiners pursuant to section 423C.03, subdivision 6, to 
 82.3   investigate and make recommendations on an application for a 
 82.4   pension pursuant to this subdivision. 
 82.5      Subd. 6.  [NON-SERVICE-RELATED PERMANENT DISABILITY 
 82.6   PENSION.] An active member who, by sickness or accident, becomes 
 82.7   permanently disabled from performing firefighter duties for the 
 82.8   fire department shall be entitled to a permanent disability 
 82.9   pension.  No allowance for disability shall be made unless 
 82.10  notice of the disability and an application for benefits is made 
 82.11  by or on behalf of the disabled member within 90 days after the 
 82.12  beginning of the disability.  This application shall include a 
 82.13  certificate from a qualified medical professional setting forth 
 82.14  the cause, nature, and extent of the disability.  The board may 
 82.15  appoint a board of examiners pursuant to section 423C.03, 
 82.16  subdivision 6, to investigate and report on an application for 
 82.17  benefits pursuant to this section and make recommendations as to 
 82.18  eligibility and the benefit amount to be paid.  A member 
 82.19  entitled to a disability pension shall receive benefits in the 
 82.20  amount and manner determined by the board, not to exceed 41 
 82.21  units. 
 82.22     Subd. 7.  [SURVIVING SPOUSE AND DEPENDENT 
 82.23  PENSIONS.] Notwithstanding any other law to the contrary, when a 
 82.24  service pensioner, disability pensioner, deferred pensioner, or 
 82.25  active member of the association dies, recipient beneficiaries 
 82.26  are entitled to a pension or pensions, as follows: 
 82.27     (1) to a surviving spouse, a pension of 22 units per month; 
 82.28     (2) to a surviving spouse of a deceased service pensioner, 
 82.29  disability pensioner, or deferred pensioner who is otherwise not 
 82.30  qualified for a pension may receive a benefit if the surviving 
 82.31  spouse was legally married to the decedent for a period of two 
 82.32  years and was residing with the decedent at the time of death.  
 82.33  The surviving spouse benefit provided in this clause is the same 
 82.34  as that provided to those who meet the definition of surviving 
 82.35  spouse under section 423C.01, subdivision 25, except that if the 
 82.36  surviving spouse is younger than the decedent, the surviving 
 83.1   spouse benefit must be actuarially equivalent to a surviving 
 83.2   spouse benefit that would have been paid to the member's spouse 
 83.3   had the member been married to a person of the same or greater 
 83.4   age than the member's age prior to retirement.  A benefit paid 
 83.5   in this circumstance may be less than 17 units notwithstanding 
 83.6   the minimum set out in this clause; 
 83.7      (3) to each dependent, if the dependent's other parent is 
 83.8   living, a pension not to exceed eight units per month.  
 83.9   Dependents between the ages of 18 and 22 may continue to receive 
 83.10  a pension upon board determination that the dependent complies 
 83.11  with the requirements of section 423C.01, subdivision 11, and 
 83.12  applicable association bylaws, except that if the dependent 
 83.13  marries before the age of 22 years the pension shall cease as of 
 83.14  the date of the marriage.  The board shall make the final 
 83.15  determination with respect to eligibility for benefits and 
 83.16  compliance with section 423C.01, subdivision 11; 
 83.17     (4) to each dependent of a deceased member after the death 
 83.18  of the dependent's other parent, or in the event the other 
 83.19  parent predeceases the member, is entitled to receive a pension 
 83.20  in the amount the board deems necessary to properly support each 
 83.21  dependent until the dependent reaches the age of not less than 
 83.22  16 and not more than 18 years.  Dependents between the ages of 
 83.23  18 and 22 may be entitled to continue receiving a pension upon 
 83.24  board determination that the dependent complies with the 
 83.25  requirements of section 423C.01, subdivision 11, and applicable 
 83.26  association bylaws, except that if the dependent marries before 
 83.27  the age of 22 years the pension shall cease as of the date of 
 83.28  the marriage.  The board shall make the final determination with 
 83.29  respect to eligibility for benefits and compliance; and 
 83.30     (5) the total pension payable to a surviving spouse and all 
 83.31  dependents of a deceased member shall in no event exceed 41 
 83.32  units per month. 
 83.33     Subd. 8.  [OPTIONAL RETIREMENT ANNUITY ELECTION.] A member 
 83.34  of the association who retires under subdivision 2 or becomes 
 83.35  disabled under subdivision 6 may elect an optional retirement 
 83.36  annuity prior to the receipt of any benefits.  The optional 
 84.1   retirement annuity may be a 50 percent, 75 percent, or 100 
 84.2   percent joint survivor annuity without reinstatement in the 
 84.3   event the designated beneficiary predeceases the member or a 
 84.4   joint and survivor annuity with reinstatement in the event the 
 84.5   member predeceases the designated beneficiary.  An optional 
 84.6   retirement annuity must be actuarially equivalent to the service 
 84.7   pension and automatic survivor coverage otherwise payable to the 
 84.8   retired member and the member's beneficiaries.  Once selected, 
 84.9   the optional annuity is irrevocable. 
 84.10     Subd. 9.  [JOINT AND SURVIVOR OPTION FOR UNMARRIED MEMBER.] 
 84.11  A retired member who is not legally married may select the joint 
 84.12  and survivor 50 percent optional benefit form as if the member 
 84.13  were married to a spouse of the same age provided that the 
 84.14  member forever forfeits and the fund will not pay a benefit to a 
 84.15  surviving spouse under subdivision 7. 
 84.16     Sec. 6.  [423C.06] [INVESTMENT-RELATED POSTRETIREMENT 
 84.17  ADJUSTMENTS.] 
 84.18     Subdivision 1.  [ANNUAL ADJUSTMENTS.] Notwithstanding the 
 84.19  provisions of chapter 69, or any other law to the contrary, the 
 84.20  association may provide annual postretirement payments to 
 84.21  eligible members under this section.  No provision of or payment 
 84.22  made under this section may be interpreted or relied upon by any 
 84.23  member of the association to guarantee or entitle a member to 
 84.24  annual postretirement adjustments for any period when the 
 84.25  requirements in this section have not been met. 
 84.26     Subd. 2.  [ACTUARIAL ASSETS OF SPECIAL FUND LESS THAN 102 
 84.27  PERCENT.] When the actuarial assets of the special fund in any 
 84.28  year are less than 102 percent of its accrued liabilities 
 84.29  according to the most recent annual actuarial valuation of the 
 84.30  special fund prepared in accordance with sections 356.215 and 
 84.31  356.216, investment-related postretirement adjustments shall be 
 84.32  determined and paid pursuant to this subdivision.  Payment of 
 84.33  the annual postretirement adjustment may be made only if there 
 84.34  is excess investment income. 
 84.35     (a) The board shall determine by May 1 of each year whether 
 84.36  or not the special fund has excess investment income.  The 
 85.1   amount of excess investment income, if any, must be stated as a 
 85.2   dollar amount and reported by the executive secretary to the 
 85.3   mayor and governing body of the city, the state auditor, the 
 85.4   commissioner of finance, and the executive director of the 
 85.5   legislative commission on pensions and retirement.  The dollar 
 85.6   amount of excess investment income up to one percent of the 
 85.7   assets of the special fund must be applied for the purpose 
 85.8   specified in paragraph (b).  Excess investment income must not 
 85.9   be considered as income to or assets of the special fund for 
 85.10  actuarial valuations of the special fund for that year under 
 85.11  sections 69.77, 356.215, 356.216, and this section except to 
 85.12  offset the annual postretirement adjustment.  Additional 
 85.13  investment income is any realized or unrealized investment 
 85.14  income other than the excess investment income and must be 
 85.15  included in the actuarial valuations performed under sections 
 85.16  69.77, 356.215, 356.216, and this section. 
 85.17     (b) The amount determined under paragraph (a) must be 
 85.18  applied as follows:  the association shall apply the first 
 85.19  one-half of one percent of assets that constitute excess 
 85.20  investment income to the payment of an annual postretirement 
 85.21  adjustment to eligible members and the second one-half of one 
 85.22  percent of assets which constitute excess investment income 
 85.23  shall be applied to reduce the state amortization state aid or 
 85.24  supplementary amortization state aid payments otherwise due the 
 85.25  association under section 423A.02 for the current calendar 
 85.26  year.  The amounts of all payments to eligible members shall not 
 85.27  exceed one-half of one percent of the assets of the fund.  The 
 85.28  amount of each eligible member's postretirement adjustment shall 
 85.29  be calculated by dividing the total number of units to which 
 85.30  eligible members are entitled into the excess investment income 
 85.31  available for distribution to eligible members, and then 
 85.32  multiplying that result by the number of units to which each 
 85.33  eligible member is entitled.  If this amount exceeds the total 
 85.34  monthly benefit that the eligible member was entitled to in the 
 85.35  prior year under the terms of this chapter, the association 
 85.36  shall pay the eligible member the lesser amount.  Payment of the 
 86.1   annual postretirement adjustment must be in a lump-sum amount on 
 86.2   June 1 following the determination date in any year.  In the 
 86.3   event an eligible member dies prior to the payment of the annual 
 86.4   postretirement adjustment, the executive secretary shall pay the 
 86.5   eligible member's estate the amount to which the member was 
 86.6   entitled. 
 86.7      Subd. 3.  [ACTUARIAL ASSETS OF SPECIAL FUND 102 PERCENT OR 
 86.8   MORE.] When the actuarial assets of the special fund in any year 
 86.9   are 102 percent or more of its accrued liabilities according to 
 86.10  the most recent annual actuarial valuation of the special fund 
 86.11  prepared in accordance with sections 356.215 and 356.216, an 
 86.12  investment-related postretirement adjustment shall be determined 
 86.13  and paid pursuant to this subdivision.  Payment of the annual 
 86.14  postretirement adjustment may only be made if there is excess 
 86.15  investment income. 
 86.16     (a) The board shall determine by May 1 of each year whether 
 86.17  or not the special fund has excess investment income.  The 
 86.18  amount of excess investment income, if any, must be stated as a 
 86.19  dollar amount and reported by the executive secretary to the 
 86.20  mayor and governing body of the city, the state auditor, the 
 86.21  commissioner of finance, and the executive director of the 
 86.22  legislative commission on pensions and retirement.  The dollar 
 86.23  amount of excess investment income up to 1-1/2 percent of the 
 86.24  assets of the fund must be applied for the purpose specified in 
 86.25  paragraph (b).  Excess investment income must not be considered 
 86.26  as income to or assets of the special fund for actuarial 
 86.27  valuations of the special fund for that year under sections 
 86.28  69.77, 356.215, 356.216, and this section except to offset the 
 86.29  annual postretirement adjustment.  Additional investment income 
 86.30  is any realized or unrealized investment income other than the 
 86.31  excess investment income and must be included in the actuarial 
 86.32  valuations performed under sections 69.77, 356.215, 356.216, and 
 86.33  this section. 
 86.34     (b) The amount determined under paragraph (a) must be 
 86.35  applied as follows:  the association shall apply the 1-1/2 
 86.36  percent of assets that constitute excess investment income to 
 87.1   the payment of an annual postretirement adjustment to eligible 
 87.2   members.  The amount of each eligible member's postretirement 
 87.3   adjustment shall be calculated by dividing the total number of 
 87.4   units to which eligible members are entitled into the excess 
 87.5   investment income available for distribution to eligible 
 87.6   members, and then multiplying that result by the number of units 
 87.7   to which each eligible member is entitled.  Payment of the 
 87.8   annual postretirement adjustment must be in a lump-sum amount on 
 87.9   June 1 following the determination date in any year.  In the 
 87.10  event an eligible member dies prior to the payment of the annual 
 87.11  postretirement adjustment, the executive secretary shall pay the 
 87.12  eligible member's estate the amount to which the member was 
 87.13  entitled. 
 87.14     Subd. 4.  [ACTUARIAL ASSETS OF SPECIAL FUND 110 PERCENT OR 
 87.15  MORE.] When the actuarial assets of the special fund in any year 
 87.16  are 110 percent or more of its accrued liabilities according to 
 87.17  the most recent annual actuarial valuation of the special fund 
 87.18  prepared in accordance with sections 356.215 and 356.216, an 
 87.19  investment-related postretirement adjustment shall be determined 
 87.20  and paid pursuant to this subdivision.  Payment of the annual 
 87.21  postretirement adjustment may be made only if a total excess 
 87.22  asset amount exists. 
 87.23     (a) The board shall determine by May 1 of each year whether 
 87.24  the special fund has a total excess asset amount for that year.  
 87.25  If a total excess asset amount exists for the given year, the 
 87.26  net total asset amount shall be determined.  The executive 
 87.27  secretary shall report the total excess asset amount and net 
 87.28  total excess asset amount to the mayor and governing body of the 
 87.29  city, the state auditor, the commissioner of finance, and the 
 87.30  executive director of the legislative commission on pensions and 
 87.31  retirement.  The portion of the net excess asset amount which is 
 87.32  distributed under this subdivision shall not be considered 
 87.33  income to or assets of the special fund for actuarial valuations 
 87.34  of the special fund for that year under sections 69.77, 356.215, 
 87.35  and 356.216 and Laws 2000, chapter 461, except to offset the 
 87.36  amount distributed. 
 88.1      (b) Twenty percent of the net total excess asset amount 
 88.2   determined under paragraph (a) is available for excess asset 
 88.3   amount payments under paragraph (c). 
 88.4      (c) Except as limited under paragraph (d), the net excess 
 88.5   asset amount payment to an eligible member is equal to the 
 88.6   amount determined under paragraph (b) multiplied by the units 
 88.7   applicable to the eligible member and divided by the total units 
 88.8   of all eligible members. 
 88.9      (d) A member who is an eligible member for the entire 12 
 88.10  months before the determination date is eligible for a full 
 88.11  excess asset amount payment pursuant to paragraph (c).  A member 
 88.12  who is an eligible member for less than 12 months before the 
 88.13  determination date is eligible for a prorated excess asset 
 88.14  amount payment.  If an eligible member dies before the 
 88.15  determination date and before the excess asset amount payment 
 88.16  commences, the association shall pay the eligible member's 
 88.17  excess asset amount payment to the eligible member's surviving 
 88.18  spouse or, if no surviving spouse, to the eligible member's 
 88.19  estate. 
 88.20     (e) The excess asset amount payments determined under this 
 88.21  subdivision commence on June 1 following the determination 
 88.22  date.  The board may disburse payments to eligible members in a 
 88.23  lump sum, 12 monthly installments, or any other manner that the 
 88.24  board determines. 
 88.25     Subd. 5.  [REPORT ON ANNUAL POSTRETIREMENT 
 88.26  ADJUSTMENTS.] The executive secretary shall submit a report on 
 88.27  the amount of all postretirement adjustments made under this 
 88.28  section and the manner in which those payments were determined 
 88.29  to the state auditor, the executive director of the legislative 
 88.30  commission on pensions and retirement, and the city clerk. 
 88.31     Subd. 6.  [CITY TAX LEVY.] If in any year after the 
 88.32  actuarial value of special fund assets, according to the most 
 88.33  recent annual actuarial valuation prepared in accordance with 
 88.34  sections 356.215 and 356.216, is greater than 102 percent of the 
 88.35  actuarial accrued liabilities of the special fund and 
 88.36  subsequently the actuarial value of assets is less than 100 
 89.1   percent of the actuarial accrued liabilities according to the 
 89.2   most recent annual actuarial valuation prepared according to 
 89.3   sections 356.215 and 356.216, the city of Minneapolis is not 
 89.4   required to levy a property tax to fund any deficit unless the 
 89.5   fund has two successive years when the actuarial value of assets 
 89.6   is less than 100 percent of the actuarial accrued liabilities 
 89.7   according to the most recent annual actuarial valuation prepared 
 89.8   according to sections 356.215 and 356.216. 
 89.9      Sec. 7.  [423C.07] [ACTUARIAL VALUATION DATE.] 
 89.10     Notwithstanding section 69.77, subdivision 2h; 356.215; or 
 89.11  356.216, the annual actuarial valuation of the association must 
 89.12  be completed by May 1 of each year. 
 89.13     Sec. 8.  [423C.08] [MEMBER CONTRIBUTION REFUND TO 
 89.14  BENEFICIARY UPON DEATH.] 
 89.15     If an active, deferred, or retired member of the 
 89.16  association dies and no survivor benefit is payable, the 
 89.17  designated beneficiary of the decedent or, if none, the legal 
 89.18  representative of the estate of the decedent is entitled, upon 
 89.19  application, to a refund.  The refund shall be an amount equal 
 89.20  to the member contributions to the credit of the decedent, plus 
 89.21  interest on those contributions at an annual compounded rate of 
 89.22  five percent from the first day of the month following the date 
 89.23  of death of the decedent, reduced by the sum of any service 
 89.24  pension or disability benefit previously paid by the fund to the 
 89.25  decedent. 
 89.26     Sec. 9.  [423C.09] [PAYMENTS EXEMPT FROM PROCESS.] 
 89.27     All payments made, or to be made, by the association under 
 89.28  this chapter shall be totally exempt from garnishment, 
 89.29  execution, or other legal process, except as provided in section 
 89.30  518.58, 518.581, or 518.6111.  No person entitled to a payment 
 89.31  shall have the right to assign the name, nor shall the 
 89.32  association have authority to recognize any assignment or to pay 
 89.33  any sum on account thereof.  Any attempt to transfer any right 
 89.34  or claim, or any part thereof, shall be void. 
 89.35     Sec. 10.  [423C.10] [LAW GOVERNING PENSIONS AND BENEFITS.] 
 89.36     A service pension or other retirement benefit for or on 
 90.1   behalf of a member of the Minneapolis firefighters relief 
 90.2   association must be calculated under the laws, articles of 
 90.3   incorporation, or relief association bylaws in effect on the day 
 90.4   that the active member terminated active employment in the 
 90.5   Minneapolis fire department as a firefighter. 
 90.6      Sec. 11.  [423C.11] [WORKERS' COMPENSATION ACT NOT 
 90.7   AFFECTED.] 
 90.8      This chapter shall not be construed as abridging, 
 90.9   repealing, or amending the laws of this state relating to the 
 90.10  provisions of the law commonly known as the Workers' 
 90.11  Compensation Act. 
 90.12     Sec. 12.  [423C.12] [RIGHT TO REDUCE PENSIONS.] 
 90.13     The relief association has the right and retains the right 
 90.14  to reduce the amount of pensions and benefits paid from its 
 90.15  special fund and to reduce and otherwise adjust those pensions 
 90.16  and benefits.  For any pension or benefit that was reduced, the 
 90.17  relief association has the right and retains the right to 
 90.18  increase or otherwise adjust these pensions or benefits within 
 90.19  the limits of this act, as amended.  
 90.20     Sec. 13.  [423C.13] [FINANCE DIRECTOR TO FILE REPORT WITH 
 90.21  THE REVENUE COMMISSIONER.] 
 90.22     (a) On or before March 1, each year, the Minneapolis 
 90.23  finance director shall file with the county auditor and the 
 90.24  commissioner of revenue a certificate stating that the 
 90.25  Minneapolis firefighters relief association exists and including 
 90.26  any other information that the commissioner or auditor may 
 90.27  require. 
 90.28     (b) The commissioner of revenue shall provide the 
 90.29  Minneapolis finance director with the necessary documents for 
 90.30  the city of Minneapolis and the Minneapolis firefighters relief 
 90.31  association to carry out its duties and to receive the benefits 
 90.32  of sections 69.011 to 69.051, 297I.05, and 297I.10. 
 90.33     Sec. 14.  [423C.14] [STATE AUDITOR TO EXAMINE BOOKS.] 
 90.34     (a) The state auditor, annually, shall examine the books 
 90.35  and accounts of the secretary and of the treasurer of the 
 90.36  Minneapolis firefighters relief association. 
 91.1      (b) If the state auditor finds that any money in the 
 91.2   special fund of the relief association was expended for purposes 
 91.3   that were not authorized by this act, as amended, the state 
 91.4   auditor shall report that to the governor, who shall then direct 
 91.5   the commissioner of finance not to issue any further warrants to 
 91.6   the relief association until the state auditor reports that the 
 91.7   money which was unlawfully expended has been replaced.  The 
 91.8   governor additionally may take such further action as the 
 91.9   emergency may demand. 
 91.10     Sec. 15.  [REPEALER.] 
 91.11     (a) Laws 1907, chapter 24; Laws 1913, chapters 318 and 419; 
 91.12  Laws 1917, chapter 196; Laws 1919, chapters 515 and 523; Laws 
 91.13  1921, chapter 404; Laws 1923, chapter 61; and Laws 1945, chapter 
 91.14  322, are repealed. 
 91.15     (b) Laws 1959, chapters 213; 491; and 568, are repealed. 
 91.16     (c) Laws 1961, chapter 109; Extra Session Laws 1961, 
 91.17  chapter 3; Laws 1963, chapter 318; Laws 1965, chapters 519 and 
 91.18  578; Laws 1967, chapters 819 and 824; and Laws 1969, chapters 
 91.19  123 and 287, are repealed. 
 91.20     (d) Laws 1971, chapter 542; Laws 1975, chapter 57; and Laws 
 91.21  1977, chapter 164, section 2, are repealed. 
 91.22     (e) Laws 1980, chapter 607, article XV, sections 8, 9, and 
 91.23  10; Laws 1988, chapters 572, sections 4, 5, and 6; and 574, 
 91.24  sections 3, 4, and 5; and Laws 1989, chapter 319, article 19, 
 91.25  sections 6 and 7, are repealed. 
 91.26     (f) Laws 1990, chapter 589, article 1, sections 5 and 6; 
 91.27  Laws 1992, chapters 429; 454, section 2; and 471, article 2; 
 91.28  Laws 1993, chapters 125; and 192, section 32; Laws 1994, 
 91.29  chapters 591; and 632, article 3, section 14; Laws 1996, chapter 
 91.30  448, articles 2, section 3; and 3, section 1; Laws 1997, chapter 
 91.31  233, article 4, sections 12, 13, 14, 15, 16, 17, 18, 19, 20, 21, 
 91.32  and 22; Laws 1998, chapter 390, article 7, section 2; and Laws 
 91.33  2000, chapter 461, article 17, sections 6, 7, 8, 9, 10, 11, 12, 
 91.34  and 13, are repealed. 
 91.35     Sec. 16.  [EFFECTIVE DATE.] 
 91.36     Sections 1 to 15 are effective on the day after the city 
 92.1   council of the city of Minneapolis and its chief clerical 
 92.2   officer timely complete their compliance with Minnesota 
 92.3   Statutes, section 645.021, subdivisions 2 and 3. 
 92.4                              ARTICLE 6
 92.5         VOLUNTEER FIREFIGHTER RELIEF ASSOCIATION PROVISIONS
 92.6      Section 1.  Minnesota Statutes 2000, section 424A.04, is 
 92.7   amended by adding a subdivision to read:  
 92.8      Subd. 3.  [CONDITIONS ON RELIEF ASSOCIATION 
 92.9   CONSULTANTS.] (a) If a volunteer firefighter relief association 
 92.10  hires or contracts with a consultant to provide legal or 
 92.11  financial advice, the association shall obtain and the 
 92.12  consultant shall provide a copy of the consultant's certificate 
 92.13  of insurance. 
 92.14     (b) A consultant is any person who is employed under 
 92.15  contract to provide legal or financial advice and who is or who 
 92.16  represents to the volunteer firefighter relief association that 
 92.17  the person is: 
 92.18     (1) an actuary; 
 92.19     (2) a licensed public accountant or a certified public 
 92.20  accountant; 
 92.21     (3) an attorney; 
 92.22     (4) an investment advisor or manager, or an investment 
 92.23  counselor; 
 92.24     (5) an investment advisor or manager selection consultant; 
 92.25     (6) a pension benefit design advisor or consultant; or 
 92.26     (7) any other financial consultant. 
 92.27     Sec. 2.  [WHITE BEAR LAKE VOLUNTEER FIREFIGHTER RELIEF 
 92.28  ASSOCIATION; QUALIFICATION FOR SERVICE PENSION IN CERTAIN 
 92.29  INSTANCES.] 
 92.30     Notwithstanding any provision to the contrary of Minnesota 
 92.31  Statutes, section 424A.001, subdivision 9; or 424A.02, 
 92.32  subdivision 1, paragraph (d), or subdivision 9b, a member of the 
 92.33  White Bear Lake volunteer firefighter relief association who has 
 92.34  terminated active membership in the relief association and has 
 92.35  otherwise qualified for a service pension is entitled to receive 
 92.36  a service pension from the relief association despite subsequent 
 93.1   employment of the person by the city of White Bear Lake to 
 93.2   perform duties as fire chief or as fire inspector within the 
 93.3   municipal fire department on a full-time basis. 
 93.4      Sec. 3.  [EFFECTIVE DATE.] 
 93.5      (a) Section 1 is effective July 1, 2001. 
 93.6      (b) Section 2 is effective on the day after the city 
 93.7   council of the city of White Bear Lake and its chief clerical 
 93.8   officer timely complete their compliance with Minnesota 
 93.9   Statutes, section 645.021, subdivisions 2 and 3.