SF 2556

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

  1.1                          A bill for an act 
  1.2             relating to retirement; authorizing certain persons to 
  1.3             purchase service credit in the Minnesota state 
  1.4             retirement system. 
  1.5   BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
  1.6      Section 1.  [PURCHASE OF SERVICE CREDIT AUTHORIZATION.] 
  1.7      Subdivision 1.  [ELIGIBLE EMPLOYEE.] (a) Notwithstanding 
  1.8   Minnesota Statutes, chapter 352, an eligible employee described 
  1.9   in paragraph (b) is eligible to purchase service credit in the 
  1.10  Minnesota state retirement system general plan as specified in 
  1.11  subdivision 2. 
  1.12     (b) An eligible employee is a person who: 
  1.13     (1) has been employed by the middle management association 
  1.14  since February 14, 1994; and 
  1.15     (2) was born on September 13, 1958. 
  1.16     Subd. 2.  [RETIREMENT COVERAGE.] An eligible employee under 
  1.17  subdivision 1, paragraph (b), is entitled to purchase service 
  1.18  credit in the Minnesota state retirement system general plan for 
  1.19  the period of service prior to the effective date of this act 
  1.20  for service with the middle management association.  Any period 
  1.21  for which the individual has received service credit or is 
  1.22  eligible to receive service credit in any other Minnesota public 
  1.23  pension plan, other than a volunteer fire plan, is not eligible 
  1.24  for purchase. 
  1.25     Subd. 3.  [AMOUNT.] (a) To receive service credit under 
  2.1   subdivision 2, the Minnesota state retirement system must 
  2.2   receive an amount equal to the actuarial present value, on the 
  2.3   date of payment, as calculated by the actuary retained by the 
  2.4   legislative commission on pensions and retirement, of the amount 
  2.5   of the additional retirement annuity obtained by the acquisition 
  2.6   of the additional service credit in this section.  Calculation 
  2.7   of this amount must be made using the preretirement interest 
  2.8   rate applicable to the Minnesota state retirement system general 
  2.9   plan specified in Minnesota Statutes, section 356.215, 
  2.10  subdivision 4d, and the mortality table adopted for the pension 
  2.11  plan.  The calculation must assume continuous future service in 
  2.12  the association until, and retirement at, the age at which the 
  2.13  minimum requirements of the fund for normal retirement or 
  2.14  retirement with an annuity unreduced for retirement at an early 
  2.15  age, including Minnesota Statutes, section 356.30, are met with 
  2.16  the additional service credit purchased.  The calculation must 
  2.17  assume that the individual accrues future service credit each 
  2.18  year based on a three-year average using the most recent 
  2.19  three-year period of service.  The salary used in the 
  2.20  calculation must be the eligible person's actual current 
  2.21  salary.  The calculation must assume a future salary history 
  2.22  that includes annual salary increases at the applicable salary 
  2.23  increase rate for the plan specified in Minnesota Statutes, 
  2.24  section 356.215, subdivision 4d. 
  2.25     (b) Payment must be made in one lump sum before July 1, 
  2.26  1999. 
  2.27     (c) Payment of the amount calculated under this subdivision 
  2.28  must be made by the eligible employee.  However, the middle 
  2.29  management association may, at its discretion, pay all or any 
  2.30  portion of the payment amount that exceeds an amount equal to 
  2.31  the employee contribution rates in effect during the periods of 
  2.32  prior service applied to the actual salary rates in effect 
  2.33  during the periods of prior service, plus interest at the rate 
  2.34  of 8-1/2 percent a year compounded annually from the date on 
  2.35  which the contributions would have been made if retirement 
  2.36  coverage were authorized at the time, to the date on which the 
  3.1   payment is made.  If the association agrees to payments under 
  3.2   this paragraph, the eligible employee must make the employee 
  3.3   payments required under this paragraph before July 1, 1999.  If 
  3.4   that employee payment is made, the association payment under 
  3.5   this paragraph must be remitted to the executive director of the 
  3.6   Minnesota state retirement system within 60 days of receipt by 
  3.7   the executive director of the employee payments specified under 
  3.8   this paragraph. 
  3.9      Subd. 4.  [SERVICE CREDIT GRANT.] Service credit for the 
  3.10  purchase period must be granted by the Minnesota state 
  3.11  retirement system to the account of the eligible employee upon 
  3.12  receipt of the purchase payment amount specified in subdivision 
  3.13  3. 
  3.14     Sec. 2.  [EFFECTIVE DATE.] 
  3.15     Section 1 is effective the day following final enactment.