Minnesota Legislature
SF 2463
as introduced - 84th Legislature (2005 - 2006) Posted on 12/15/2009 12:00am
Current Version - as introduced
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A bill for an act
relating to retirement; Social Security administration; making technical
corrections; allowing for prospective and retroactive Social Security and
Medicare coverage of certain governmental employees; requiring referenda;
amending Minnesota Statutes 2004, sections 355.01, subdivision 3g; 355.02,
subdivisions 1, 3, by adding subdivisions; proposing coding for new law in
Minnesota Statutes, chapter 355.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:
Section 1.
Minnesota Statutes 2004, section 355.01, subdivision 3g, is amended to read:
Subd. 3g.
Local governmental subdivision.
"Local governmental subdivision"
means:
(1) a political subdivision as defined in section 218(b) of the Social Security Act;
(2) an instrumentality of the state;
(3) an instrumentality of one or more of the political subdivisions of the statedeleted text begin ,
including the League of Minnesota Citiesdeleted text end ;
(4) an instrumentality of the state and one or more of its political subdivisions;
(5) a governmental subdivision as defined in section 353.01, subdivision 6; and
(6) any instrumentality established under a joint powers agreement under section
471.59 wherein the instrumentality is responsible for the employment and the payment of
the salaries of the employees of the instrumentality.
Sec. 2.
Minnesota Statutes 2004, section 355.02, subdivision 1, is amended to read:
Subdivision 1.
General authority.
(a) The director, with the approval of the
governor, is hereby authorized to enter into an agreement on behalf of the statenew text begin , its political
subdivisions and its other governmental employers, new text end with the federal Secretary of Health
and Human Services, consistent with the terms and provisions of this chapter, for the
purpose of extending the benefits of the federal old age, survivors, and disability insurance
system to employees of the state or any political subdivision thereof new text begin who hold positions
covered by a retirement system new text end with respect to services specified in the agreement which
constitute "employmentdeleted text begin ,deleted text end new text begin .new text end " deleted text begin whenever so specifically authorized by the statutory provisions
of this state pertaining to any coverage group of such employees to which the agreement
may become applicable under the Social Security Act.
deleted text end
(b) deleted text begin Under this specific authorizationdeleted text end The agreement may contain those provisions
relating to coverage, benefits, contributions, effective date, modification and termination
of the agreement, administration, and other appropriate provisions as the director and the
federal Secretary of Health and Human Services shall agree upon, but, except as may be
otherwise required by or under the Social Security Act as to the services to be covered,
such agreement must provide in effect that:
(1) benefits will be provided for employees whose services are covered by the
agreement (and their dependents and survivors) on the same basis as though those services
constituted employment within the meaning of title II of the Social Security Act;
(2) the state or other employer will pay to the federal Secretary of the Treasury, at
such time or times as may be prescribed under the Social Security Act, contributions
with respect to wages, equal to the sum of the taxes which would be imposed by the
Federal Insurance Contributions Act if the services covered by the agreement constituted
employment within the meaning of that act;
(3) the agreement is effective with respect to services in employment covered by the
agreement performed after a date specified therein; and
(4) all services which constitute employment and are performed in the employ of
the state or any of its political subdivisions by employees thereof, may be covered by the
agreement deleted text begin whenever so specifically authorized by the statutory provisions of this state
pertaining to any coverage group of such employees to which the agreement may become
applicable under the Social Security Actdeleted text end .
Sec. 3.
Minnesota Statutes 2004, section 355.02, subdivision 3, is amended to read:
Subd. 3.
Groups covered by Social Security.
new text begin (a) new text end The following groups new text begin having
coverage under a retirement plan in section 356.30, subdivision 3, except clauses (4) and
(8) new text end must be covered by an agreement or a modification to an agreement between the
director and the federal Secretary of Health and Human Services:
(1) constitutional officers;
(2) Duluth teachers;
(3) educational employees;
(4) higher education employees;
(5) hospital employees;
(6) judges;
(7) legislators;
(8) Minneapolis teachers;
(9) public employees;
(10) St. Paul teachers;new text begin and
new text end
(11) deleted text begin special authority or district employees; and
deleted text end
deleted text begin (12)deleted text end state employees.
new text begin
(b) The following groups must be covered prospectively following the referendum
in subdivision 4 and the modification to the state Social Security agreement under
subdivision 1:
new text end
new text begin
(1) special authority or district employees in positions covered by a retirement plan
provided by the employer; and
new text end
new text begin
(2) local elected officials of a local governmental subdivision or of a special authority
or district holding positions covered by the defined contribution plan under chapter 353D.
new text end
new text begin
(c) Each local governmental subdivision or special authority or district desiring
inclusion in the state Social Security agreement for groups covered by paragraph (b) must
request such coverage by submitting a formal resolution to the director, including therein
the desired starting date for Social Security coverage.
new text end
new text begin
(d) For purposes of paragraph (b), clause (2), the defined contribution plan of the
Public Employees Retirement Association is considered a separate retirement system with
respect to each local governmental subdivision or special authority or district, and the
elected officials in a local governmental subdivision or in a special authority or district
must be treated separately and independently from the other governmental subdivisions.
new text end
Sec. 4.
Minnesota Statutes 2004, section 355.02, is amended by adding a subdivision
to read:
new text begin Subd. 4. new text end
new text begin Referendum. new text end
new text begin
The director shall authorize and supervise a referendum
under section 218(d)(6)(C) of the Social Security Act to be held on the date or dates set by
the local governmental subdivision or by the special authority or district desiring inclusion
under subdivision 3, paragraph (b). The referendum must permit each eligible employee
the opportunity to elect Social Security coverage. The notice of referendum required by
section 218(d) of the Social Security Act must contain a statement sufficient to inform
the person of the rights which accrue under the Social Security Act and the employee
contribution rates applicable to the program. The cost of the referendum is to be borne
by the governmental subdivision. The director, on receiving satisfactory evidence that
the conditions required by section 218 of the Social Security Act have been met, must
so certify to the Secretary of Health and Human Services.
new text end
Sec. 5.
Minnesota Statutes 2004, section 355.02, is amended by adding a subdivision
to read:
new text begin Subd. 5. new text end
new text begin Retroactive Social Security coverage. new text end
new text begin
(a) An employee or elected official
who elects Social Security coverage under subdivision 4 may obtain retroactive coverage
for the period specified in the modification of the agreement if the individual is employed
by the local governmental subdivision or by the special authority or district on the date of
the modification of the agreement. The employee or elected official must pay an amount
equal to the taxes which would have been imposed on the person by the Federal Insurance
Contributions Act had the service been covered at the time performed. The employing
local governmental subdivision or special authority or district must pay the necessary
employer contributions for the retroactive period. Nothing in this section shall require an
employee or elected official to elect retroactive Social Security coverage.
new text end
Sec. 6.
new text begin
[355.095] OPTIONAL MEDICARE COVERAGE FOR CERTAIN
PUBLIC EMPLOYEES.
new text end
new text begin new text end
new text begin Subdivision 1. new text end
new text begin Agreement. new text end
new text begin
(a) The director, on behalf of the state, its political
subdivisions, and its other governmental employers, is authorized to enter into an
agreement with the Secretary of Health and Human Services to extend the provisions of
United States Code, title 42, section 426, 426-1, and 1395c, to the employees in paragraph
(b) who meet the requirements of United States Code, title 42, section 418(v)(2) and who
do not have coverage by the federal old age, survivors, and disability insurance program
for that employment under any previous modification of the agreement or previous
Medicare referendum.
new text end
new text begin
(b) The applicable employees are:
new text end
new text begin
(1) employees who are members of one of the retirement plans in section 356.30,
subdivision 3, except clauses (4) and (8), based on continuous employment since March
31, 1986; and
new text end
new text begin
(2) employees of a special authority or district who have been continuously
employed by the special authority or district since March 31, 1986.
new text end
new text begin Subd. 2. new text end
new text begin Referendum. new text end
new text begin
(a) Each local governmental subdivision or special authority
or district desiring inclusion in the state Social Security agreement under subdivision 1
must request such coverage by submitting a formal resolution to the director, including
therein the desired starting date for Social Security coverage.
new text end
new text begin
(b) The director shall authorize a referendum on the question of extending the
provisions of United States Code, title 42, sections 426, 426-1, and 1395c. The director
shall supervise the referendum in accordance with the requirements of United States Code,
title 42, section 418, on the date or dates set. The cost of such referendum must be borne by
the requesting retirement plan, or the requesting special authority or district. The notice of
the referendum provided to each eligible employee must contain a statement sufficient to
inform the person of the rights available as an employee in Medicare qualified government
employment and the employee contribution rates applicable to the program. The
referendum must permit each eligible employee the opportunity to vote in such referendum
in accordance with the requirements in the Social Security Act. The director, on receiving
satisfactory evidence that the conditions specified in United States Code, title 42, section
418(d)(7) have been met, must so certify to the Secretary of Health and Human Services.
new text end
new text begin Subd. 3. new text end
new text begin Contributions. new text end
new text begin
Employers must pay the necessary employer contributions
and make the necessary deductions from salary for employees who elect to participate in
the federal Medicare program under this section and as required by federal law.
new text end
new text begin Subd. 4. new text end
new text begin Retroactive Medicare coverage. new text end
new text begin
(a) An individual who obtains medicare
coverage through the referendum under subdivision 2 may obtain retroactive coverage for
the period specified in the modification of the agreement if employed by the governmental
subdivision or by the special authority or district on the date of the modification of the
agreement. The individual must pay an amount equal to the Medicare taxes which would
have been imposed on the employee had the service been covered at the time performed.
The employing local governmental subdivision or special authority or district must pay
the necessary employer contributions for the retroactive Medicare coverage period.
Nothing in this section shall require an employee or elected official to elect retroactive
Medicare coverage.
new text end
Sec. 7. new text begin EFFECTIVE DATE.
new text end
new text begin
Sections 1 to 6 are effective the day following final enactment.
new text end