as introduced - 90th Legislature (2017 - 2018) Posted on 03/16/2018 03:13pm
A bill for an act
relating to retirement; benefit and contribution changes for Minnesota statewide
and major local public employee retirement plans; increasing contribution rates;
reducing certain postretirement adjustment rates; modifying investment return
assumptions; extending amortization target dates; reducing deferred annuities
augmentation; requiring a study on postretirement adjustments; making
administrative changes to the Minnesota State Retirement System, Teachers
Retirement Association, Public Employees Retirement Association, and St. Paul
Teachers Retirement Fund Association; clarifying refund repayment procedures;
modifying executive director credentials; clarifying service requirements; revising
appeal procedures; modifying service credit purchase procedures; establishing
new procedures for disability applications due to private disability insurance
requirements; clarifying disability benefit payment provisions; modifying annual
benefit limitations for federal tax code compliance; authorizing use of IRS
correction procedures; clarifying benefit offsets for certain refund payments;
clarifying police and fire plan coverage for certain Hennepin Healthcare System
supervisors; modifying various economic actuarial assumptions; authorizing the
transfer of assets and members from the voluntary statewide volunteer firefighter
retirement plan to a volunteer firefighter relief association; adopting
recommendations of the Volunteer Firefighter Relief Association working group;
increasing the lump-sum service pension maximum and lowering certain vesting
requirements for Eden Prairie Volunteer Firefighters Relief Association; modifying
the Brook Park volunteer firefighters service pension level; permitting alternative
allocation of fire state aid for city of Austin; establishing a fire state aid work
group; modifying various Department of Human Services and Department of
Corrections employment classifications eligible for correctional retirement
coverage; revising augmentation interest rates for certain terminated privatized
employees; adopting definition of the Hometown Heroes Act related to public
safety officer death benefits; allowing service credit purchase and rule of 90
eligibility for certain Minnesota Department of Transportation employees;
authorizing MnSCU employees to elect retroactive and prospective TRA coverage;
authorizing MnSCU employee to transfer past service from IRAP to PERA;
increasing maximum employer contribution to a supplemental laborers pension
fund; authorizing certain additional sources of retirement plan funding; making
technical and conforming changes; authorizing direct state aid to the public
employees police and fire retirement plan and the St. Paul Teachers Retirement
Fund Association; modifying pension adjustment revenue provisions; appropriating
money; amending Minnesota Statutes 2016, sections 3A.02, subdivision 4; 3A.03,
subdivisions 2, 3; 16A.14, subdivision 2a; 126C.10, subdivision 37; 127A.45,
subdivision 12; 352.01, subdivisions 2a, 13a; 352.017, subdivision 2; 352.03,
subdivisions 5, 6; 352.04, subdivisions 2, 3, 8, 9; 352.113, subdivisions 2, 4, 14;
352.116, subdivision 1a; 352.22, subdivisions 2, 3, by adding subdivisions; 352.23;
352.27; 352.91, subdivisions 3f, 3g, by adding a subdivision; 352.92, subdivisions
1, 2, by adding a subdivision; 352.955, subdivision 3; 352B.013, subdivision 2;
352B.02, subdivisions 1a, 1c; 352B.08, by adding a subdivision; 352B.085;
352B.086; 352B.11, subdivision 4; 352D.02, subdivisions 1, 3; 352D.04,
subdivision 2; 352D.05, subdivision 4; 352D.085, subdivision 1; 352D.11,
subdivision 2; 352D.12; 352F.04, subdivisions 1, 2, by adding a subdivision;
353.01, subdivisions 2b, 10, 16, 43, 47; 353.012; 353.0162; 353.03, subdivision
3; 353.27, subdivisions 7a, 12, 12a, 12b; 353.28, subdivision 5; 353.29, subdivisions
4, 7; 353.30, subdivisions 3c, 5; 353.32, subdivisions 1, 4; 353.34, subdivisions
2, 3; 353.35, subdivision 1; 353.37, subdivision 1; 353.64, subdivision 10; 353.65,
subdivisions 2, 3, by adding a subdivision; 353F.02, subdivision 5a; 353F.025,
subdivision 2; 353F.04, subdivision 2; 353F.05; 353F.057; 353F.06; 353F.07;
353G.01, subdivision 9, by adding a subdivision; 353G.02, subdivision 6; 353G.03,
subdivision 3; 353G.08, subdivision 3; 353G.11, subdivision 1; 354.05, subdivision
2, by adding a subdivision; 354.06, subdivisions 2, 2a; 354.095; 354.42,
subdivisions 2, 3; 354.435, subdivision 4; 354.436, subdivision 3; 354.44,
subdivisions 3, 6, 9; 354.45, by adding a subdivision; 354.46, subdivision 6; 354.48,
subdivision 1; 354.49, subdivision 2; 354.50, subdivision 2; 354.51, subdivision
5; 354.512; 354.52, subdivisions 4, 4d; 354.53, subdivision 5; 354.55, subdivision
11; 354.66, subdivision 2; 354.72, subdivisions 1, 2; 354A.011, subdivisions 3a,
29; 354A.093, subdivisions 4, 6; 354A.095; 354A.096; 354A.12, subdivisions 1,
1a, 2a, 3a, 3c, 7; 354A.29, subdivision 7; 354A.31, subdivisions 3, 7; 354A.34;
354A.35, subdivision 2; 354A.37, subdivisions 2, 3; 354A.38; 356.195, subdivision
2; 356.215, subdivisions 9, 11; 356.24, subdivision 1; 356.30, subdivision 1;
356.32, subdivision 2; 356.415, subdivisions 1, 1a, 1b, 1c, 1d, 1e, 1f, by adding a
subdivision; 356.44; 356.47, subdivisions 1, 3; 356.50, subdivision 2; 356.551,
subdivision 2; 356.635, subdivision 10, by adding subdivisions; 356.96,
subdivisions 1, 2, 3, 4, 5, 6, 7, 8, 9, 10, 11, 12, 13; 356A.06, subdivision 7; 423A.02,
subdivisions 3, 5; 423A.022, subdivision 5; 424A.001, subdivisions 2, 3, 10, by
adding a subdivision; 424A.002, subdivision 1; 424A.01, subdivisions 1, 5, 6, by
adding subdivisions; 424A.015, subdivision 1, by adding a subdivision; 424A.016,
subdivision 2; 424A.02, subdivisions 1, 3a, 7; 424A.04, subdivision 1; 424A.07;
424A.091, subdivision 3; 424A.094, subdivision 3; 424A.10, subdivision 1;
424B.20, subdivision 4; 490.121, subdivisions 4, 25, 26; 490.1211; 490.123, by
adding a subdivision; 490.124, subdivision 12; Minnesota Statutes 2017
Supplement, sections 353.27, subdivision 3c; 356.215, subdivision 8; proposing
coding for new law in Minnesota Statutes, chapters 353F; 353G; 356; 424A;
repealing Minnesota Statutes 2016, sections 3A.12; 352.04, subdivision 11;
352.045; 352.72; 352B.30; 353.0161; 353.27, subdivision 3b; 353.34, subdivision
6; 353.71; 354.42, subdivisions 4a, 4b, 4c, 4d; 354.60; 354A.12, subdivision 2c;
354A.29, subdivisions 8, 9; 354A.39; 356.611, subdivisions 3, 3a, 4, 5; 356.96,
subdivisions 14, 15; 424A.02, subdivision 13.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:
Minnesota Statutes 2016, section 3A.02, subdivision 4, is amended to read:
deleted text begin (a)deleted text end The deferred retirement allowance of
any former legislator must be augmented as provided hereindeleted text begin .
deleted text end
deleted text begin (b) The required reserves applicable to the deferred retirement allowance, determined
as of the date the benefit begins to accrue using an appropriate mortality table and an interest
assumption of six percent, must be augmenteddeleted text end from the first of the month following the
termination of active service, or July 1, 1973, whichever is later, to the deleted text begin first day of the month
in which the allowance begins to accruedeleted text end new text begin effective date of retirementnew text end , at the following deleted text begin annually
compoundeddeleted text end rate or ratesnew text begin , compounded annuallynew text end :
(1) five percent until January 1, 1981;
(2) three percent from January 1, 1981, deleted text begin or from the first day of the month following the
termination of active service, whichever is later,deleted text end until January 1 of the year in which the
former legislator attains age 55 or deleted text begin untildeleted text end January 1, 2012, whichever is earlier;
(3) five percent from the period end date under clause (2) until the effective date of
retirement or deleted text begin untildeleted text end January 1, 2012, whichever is earlier; deleted text begin and
deleted text end
(4) two percent deleted text begin after December 31, 2011.deleted text end new text begin from January 1, 2012, until December 31,
2018; and
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(5) after December 31, 2018, the deferred annuity must not be augmented.
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This section is effective July 1, 2018.
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Minnesota Statutes 2016, section 352.116, subdivision 1a, is amended to read:
new text begin (a) new text end This subdivision applies to a
person who has become at least 55 years old and first became a covered employee after
June 30, 1989, and to any other covered employee who has become at least 55 years old
and whose annuity is higher when calculated under section 352.115, subdivision 3, paragraph
(b), in conjunction with this subdivision than when calculated under section 352.115,
subdivision 3, paragraph (a), in conjunction with subdivision 1. A covered employee who
retires before the normal retirement age shall be paid the normal retirement annuity provided
in section 352.115, subdivisions 2 and 3, paragraph (b), reduced deleted text begin so thatdeleted text end new text begin as described in
paragraph (b) or (c), as applicable.
new text end
new text begin (b) For covered employees who retire on or after July 1, 2019, new text end the reduced annuity is
the actuarial equivalent of the annuity that would be payable to the employee if the employee
deferred receipt of the annuity new text begin until normal retirement age new text end and the annuity amount were
augmented at deleted text begin andeleted text end new text begin the applicable new text end annual rate deleted text begin of three percentdeleted text end new text begin ,new text end compounded annuallynew text begin ,new text end from
the day the annuity begins to accrue until the normal retirement agenew text begin . The applicable annual
rate is the rate in effect on the employee's effective date of retirement and shall be considered
as fixed for the employee for the period until the employee reaches normal retirement age.
The applicable annual rates are the following:
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(1) until June 30, 2019, three percent if the employee became an employee before July
1, 2006, and 2.5 percent if the employee became an employee after June 30, 2006;
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(2) beginning July 1, 2019, through June 30, 2024, a rate that changes each month, on
the first day of the month, starting with the rate in clause (1), as applicable to the employee,
and reducing the rate to zero in equal monthly increments over the five-year period; and
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(3) after June 30, 2024, zero percent.
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After June 30, 2024, actuarial equivalent, for the purpose of determining the reduced
annuity commencing before normal retirement age under this clause, shall not take into
account any augmentation.
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new text begin (c) For covered employees who retire before July 1, 2019, the reduced annuity is the
actuarial equivalent of the annuity that would be payable to the employee if the employee
deferred receipt of the annuity until normal retirement age and the annuity amount were
augmented at an annual rate of three percent, compounded annually, from the day the annuity
begins to accrue until normal retirement agenew text end if the employee became an employee before
July 1, 2006, and at an annual rate of 2.5 percentnew text begin ,new text end compounded annuallynew text begin ,new text end from the day the
annuity begins to accrue until deleted text begin thedeleted text end normal retirement age if the employee deleted text begin initially becomesdeleted text end
new text begin became new text end an employee after June 30, 2006.
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This section is effective July 1, 2018.
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Minnesota Statutes 2016, section 352.22, subdivision 2, is amended to read:
Except as provided in subdivision 3, the refund payable
to a person who ceased to be a state employee by reason of a termination of state service is
an amount equal to employee accumulated contributions plus interest new text begin until the date on which
the refund is paid, new text end at the deleted text begin rate ofdeleted text end new text begin following rates for the applicable period:
new text end
new text begin (1) new text end six percent per year compounded daily from the date that the contribution was made
until June 30, 2011deleted text begin , or until the date on which the refund is paid, whichever is earlier, and
at the rate ofdeleted text end new text begin ;
new text end
new text begin (2)new text end four percent per year compounded daily from the date that the contribution was made
or deleted text begin fromdeleted text end July 1, 2011, whichever is later, deleted text begin until the date on which the refund is paid.deleted text end new text begin until
June 30, 2018; and
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(3) three percent per year compounded daily from the date that the contribution was
made or July 1, 2018, whichever is later.
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Included with the refund is any interest paid as part of repayment of a past refund, plus
interest thereon from the date of repayment.
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This section is effective July 1, 2018.
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Minnesota Statutes 2016, section 352.22, is amended by adding a subdivision to
read:
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Any person who has received a refund from the state
employees retirement plan, and who is a member of any of the retirement plans specified
in section 356.311, paragraph (b), may repay the refund with interest to the state employees
retirement plan. If a refund is repaid to the plan and more than one refund has been received
from the plan, all refunds must be repaid. Repayment must be made as provided in section
352.23, and under terms and conditions consistent with that section as agreed upon with
the director.
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This section is effective July 1, 2018.
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Minnesota Statutes 2016, section 352.22, subdivision 3, is amended to read:
(a) An employee who has at least three years of allowable
service if employed before July 1, 2010, or who has at least five years of allowable service
if employed after June 30, 2010, when termination occurs may elect to leave the accumulated
contributions in the fund and thereby be entitled to a deferred retirement annuity. The annuity
must be computed under the law in effect when state service terminated, on the basis of the
allowable service credited to the person before the termination of service.
(b) An employee on layoff or on leave of absence without pay, except a leave of absence
for health reasons, and who does not return to state service must have an annuity, deferred
annuity, or other benefit to which the employee may become entitled computed under the
law in effect on the employee's last working day.
(c) No application for a deferred annuity may be made more than 60 days before the
time the former employee reaches the required age for entitlement to the payment of the
annuity. The deferred annuity begins to accrue no earlier than 60 days before the date the
application is filed in the office of the system, but not (1) before the date on which the
employee reaches the required age for entitlement to the annuity nor (2) before the day
following the termination of state service in a position which is not covered by the retirement
system.
(d) Application for the accumulated contributions left on deposit with the fund may be
made at any time following the date of the termination of service.
(e) Deferred annuities must be augmented as provided in deleted text begin section 352.72, subdivision 2deleted text end new text begin
subdivision 3anew text end .
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This section is effective July 1, 2018.
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Minnesota Statutes 2016, section 352.22, is amended by adding a subdivision to
read:
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(a) The deferred annuity of any former
state employee must be augmented from the first day of the month following termination
of active service or July 1, 1971, whichever is later, to the effective date of retirement.
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(b) For a person who became a state employee before July 1, 2006, the annuity must be
augmented at the following rate or rates, compounded annually:
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(1) five percent until January 1, 1981;
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(2) three percent thereafter until January 1 of the year following the year in which the
former employee attains age 55 or January 1, 2012, whichever is earlier;
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(3) five percent from the January 1 next following the attainment of age 55 until
December 31, 2011;
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(4) two percent from January 1, 2012, until December 31, 2018; and
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(5) after December 31, 2018, the deferred annuity must not be augmented.
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(c) For a person who became a state employee after June 30, 2006, the annuity must be
augmented at the following rate or rates, compounded annually:
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(1) 2.5 percent until December 31, 2011;
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(2) two percent from January 1, 2012, until December 31, 2018; and
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(3) after December 31, 2017, the deferred annuity must not be augmented.
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(d) The retirement annuity or disability benefit of, or the survivor benefit payable on
behalf of, a former state employee who terminated service before July 1, 1997, which is not
first payable until after June 30, 1997, must be increased on an actuarial equivalent basis
to reflect the change in the postretirement interest rate actuarial assumption under section
356.215, subdivision 8, from five percent to six percent under a calculation procedure and
the tables adopted by the board and approved by the actuary retained under section 356.214.
new text end
new text begin
This section is effective July 1, 2018.
new text end
Minnesota Statutes 2016, section 352B.08, is amended by adding a subdivision to
read:
new text begin
(a) The deferred annuity of any former
member must be augmented from the first day of the month following the termination of
active service, or July 1, 1971, whichever is later, to the effective date of retirement.
new text end
new text begin
(b) For a person who became an employee before July 1, 2006, the annuity must be
augmented at the following rate or rates, compounded annually:
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(1) five percent until January 1, 1981;
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(2) three percent from January 1, 1981, until December 31, 2011;
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(3) two percent from January 1, 2012, until December 31, 2018; and
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(4) after December 31, 2018, the deferred annuity must not be augmented.
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(c) For a person who became an employee after June 30, 2006, the annuity must be
augmented at the following rate or rates, compounded annually:
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(1) 2.5 percent until December 31, 2011;
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new text begin
(2) two percent from January 1, 2012, until December 31, 2018; and
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new text begin
(3) after December 31, 2018, the deferred annuity must not be augmented.
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(d) The mortality table and interest assumption used to compute the annuity must be
those in effect when the member files application for annuity.
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This section is effective July 1, 2018.
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Minnesota Statutes 2016, section 352D.085, subdivision 1, is amended to read:
Except as provided in section 356.30, 356.302, or
356.303, service under the unclassified program deleted text begin fordeleted text end new text begin during new text end which the employee deleted text begin has been
credited with employee sharesdeleted text end new text begin contributed to the program under section 352D.04, subdivision
2, new text end may be used for the limited purpose of qualifying for benefits under sections 352.115,
deleted text begin 352.72, subdivision 1,deleted text end 352.113, 354.44, 354.45, 354.48, and deleted text begin 354.60deleted text end new text begin 356.311new text end . The service
deleted text begin alsodeleted text end may not be used to qualify for a disability benefit under section 352.113 or 354.48 if
a participant was under the unclassified program at the time of the disability. Also, the years
of service and salary paid while the participant was in the unclassified program may not be
used in determining the amount of benefits.
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This section is effective July 1, 2018.
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Minnesota Statutes 2016, section 490.121, subdivision 25, is amended to read:
"Tier I" is the benefit program of the retirement plan with a membership
specified by section 490.1221, paragraph (b), and governed by sections 356.415, deleted text begin subdivisions
1 anddeleted text end new text begin subdivision new text end 1f; and 490.121 to 490.133, except as modified in sections 490.121,
subdivision 21f, paragraph (b); 490.1222; 490.123, subdivision 1a, paragraph (b); and
490.124, subdivision 1, paragraphs (c) and (d).
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This section is effective July 1, 2018.
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Minnesota Statutes 2016, section 490.121, subdivision 26, is amended to read:
"Tier II" is the benefit program of the retirement plan with a
membership specified by section 490.1221, paragraph (c), and governed by sections 356.415,
deleted text begin subdivisions 1 anddeleted text end new text begin subdivision new text end 1f; 490.121 to 490.133, as modified in section 490.121,
subdivision 21f, paragraph (b); 490.1222; 490.123, subdivision 1a, paragraph (b); and
490.124, subdivision 1, paragraphs (c) and (d).
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This section is effective July 1, 2018.
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Minnesota Statutes 2016, sections 3A.12; 352.045; 352.72; and 352B.30,
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are repealed.
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This section is effective July 1, 2018.
new text end
Minnesota Statutes 2016, section 353.30, subdivision 5, is amended to read:
new text begin (a) new text end This subdivision applies to a
member who has become at least 55 years old and first became a public employee after
June 30, 1989, and to any other member who has become at least 55 years old and whose
annuity is higher when calculated under section 353.29, subdivision 3, paragraph (b), in
conjunction with this subdivision than when calculated under section 353.29, subdivision
3, paragraph (a), in conjunction with subdivision 1, 1a, 1b, or 1c. An employee who retires
before normal retirement age shall be paid the retirement annuity provided in section 353.29,
subdivision 3, paragraph (b), reduced deleted text begin so thatdeleted text end new text begin as described in paragraph (b) or (c), as
applicable.
new text end
new text begin (b) For members who begin to receive an annuity on or after July 1, 2019, new text end the reduced
annuity is the actuarial equivalent of the annuity that would be payable to the employee if
the employee deferred receipt of the annuity new text begin until normal retirement age new text end and the annuity
amount were augmented at deleted text begin andeleted text end new text begin the applicable new text end annual rate deleted text begin of three percentdeleted text end new text begin ,new text end compounded
annuallynew text begin ,new text end from the deleted text begin day thedeleted text end annuity deleted text begin begins to accruedeleted text end new text begin starting date new text end until deleted text begin thedeleted text end normal retirement
agenew text begin . The applicable annual rate is the rate in effect on the employee's effective date of
retirement and shall be considered as fixed for the employee for the period until the employee
reaches normal retirement age. The applicable annual rates are the following:
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new text begin
(1) until June 30, 2019, three percent if the employee became an employee before July
1, 2006, and 2.5 percent if the employee became an employee after June 30, 2006;
new text end
new text begin
(2) beginning July 1, 2019, through June 30, 2024, a rate that changes each month, on
the first day of the month, starting with the rate in clause (1), as applicable to the employee,
and reducing the rate to zero in equal monthly increments over the five-year period; and
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(3) after June 30, 2024, zero percent.
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new text begin
After June 30, 2024, actuarial equivalent, for the purpose of determining the reduced
annuity commencing before normal retirement age under this paragraph, shall not take into
account any augmentation.
new text end
new text begin (c) For members who begin to receive an annuity before July 1, 2019, the reduced annuity
is the actuarial equivalent of the annuity that would be payable to the employee if the
employee deferred receipt of the annuity until normal retirement age and the annuity amount
were augmented at an annual rate of three percent, compounded annually, from the annuity
starting date until normal retirement agenew text end if the employee became an employee before July
1, 2006, and at 2.5 percentnew text begin ,new text end compounded annuallynew text begin ,new text end from the deleted text begin day thedeleted text end annuity deleted text begin begins to accruedeleted text end
new text begin starting date new text end until deleted text begin thedeleted text end normal retirement age if the employee deleted text begin initially becomesdeleted text end new text begin became new text end an
employee after June 30, 2006.
new text begin
This section is effective for annuities with an annuity starting
date that is on or after July 1, 2019, notwithstanding the member's date of termination of
public service.
new text end
Minnesota Statutes 2016, section 353.34, subdivision 2, is amended to read:
(a) Except as provided in subdivision 1, any person who
ceases to be a deleted text begin public employeedeleted text end new text begin membernew text end is entitled to receive a refund in an amount equal
to accumulated deductions with annual compound interest to the first day of the month in
which the refund is processed.
(b) new text begin Annual compound interest rates on a refund under paragraph (a) shall be as follows:
new text end
new text begin (1) new text end deleted text begin for a person who ceases to be a public employee before July 1, 2011, the refund
interest is at the rate ofdeleted text end six percent to June 30, 2011deleted text begin ,deleted text end new text begin ;
new text end
new text begin (2) four percent after June 30, 2011, to June 30, 2018; new text end and deleted text begin at the rate of four
deleted text end
new text begin (3) three new text end percent after June 30, deleted text begin 2011.deleted text end new text begin 2018.
new text end
deleted text begin
for a person who ceases to be a public employee after July 1, 2011, the refund interest
is at the rate of four percent.
deleted text end
(c) If a person repays a refund and subsequently applies for another refund, the repayment
amount, including interest, is added to the fiscal year balance in which the repayment was
made.
(d) If the refund payable to a member is based on employee deductions that are
determined to be invalid under section 353.27, subdivision 7, the interest payable on the
invalid employee deductions is four percent.
new text begin
This section is effective July 1, 2018.
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Minnesota Statutes 2016, section 353.34, subdivision 3, is amended to read:
(a) A member who is vested
under section 353.01, subdivision 47, when termination of public service or termination of
membership occurs has the option of leaving the accumulated deductions in the fund and
being entitled to a deferred retirement annuity commencing at normal retirement age or to
a deferred early retirement annuity under section 353.30, subdivision 1a, 1b, 1c, or 5.
(b) The deferred annuity must be computed under section 353.29, subdivision 3, on the
basis of the law in effect on the date of termination of public service or termination of
membership, whichever is earlier, and must be augmented as provided in deleted text begin section 353.71,
subdivision 2deleted text end new text begin paragraph (c)new text end .
new text begin
(c) The deferred annuity of any former member must be augmented from the first day
of the month following the termination of active service, or July 1, 1971, whichever is later,
to the effective date of retirement.
new text end
new text begin
(d) For a person who became a public employee before July 1, 2006, and who has a
termination of public service before January 1, 2012, the deferred annuity must be augmented
at the following rate or rates, compounded annually:
new text end
new text begin
(1) five percent until January 1, 1981;
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(2) three percent from January 1, 1981, until January 1 of the year following the year in
which the former member attains age 55 or December 31, 2011, whichever is earlier;
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(3) five percent from January 1 of the year following the year in which the former member
attains age 55, or December 31, 2011, whichever is earlier;
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(4) one percent from January 1, 2012, until December 31, 2018; and
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(5) after December 31, 2018, the deferred annuity must not be augmented.
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new text begin
(e) For a person who became a public employee after June 30, 2006, and who has a
termination of public service before January 1, 2012, the deferred annuity must be augmented
at the following rate or rates, compounded annually:
new text end
new text begin
(1) 2.5 percent until December 31, 2011;
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(2) one percent from January 1, 2012, until December 31, 2018; and
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new text begin
(3) after December 31, 2018, the deferred annuity must not be augmented.
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new text begin
(f) For a person who has a termination of public service after December 31, 2011, the
deferred annuity must not be augmented.
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new text begin
(g) The retirement annuity or disability benefit of, or the survivor benefit payable on
behalf of, a former member who terminated service before July 1, 1997, or the survivor
benefit payable on behalf of a basic or police and fire member who was receiving disability
benefits before July 1, 1997, which is first payable after June 30, 1997, must be increased
on an actuarial equivalent basis to reflect the change in the postretirement interest rate
actuarial assumption under section 356.215, subdivision 8, from five percent to six percent
under a calculation procedure and tables adopted by the board and approved by the actuary
retained under section 356.214.
new text end
deleted text begin (c)deleted text end new text begin (h) new text end A former member qualified to apply for a deferred retirement annuity may revoke
this option at any time before the commencement of deferred annuity payments by making
application for a refund. The person is entitled to a refund of accumulated member
contributions within 30 days following date of receipt of the application by the executive
director.
new text begin
This section is effective July 1, 2018.
new text end
new text begin
Minnesota Statutes 2016, sections 353.27, subdivision 3b; and 353.71,
new text end
new text begin
are repealed.
new text end
new text begin
This section is effective July 1, 2018.
new text end
Minnesota Statutes 2016, section 354.44, subdivision 6, is amended to read:
(a) The formula
retirement annuity must be computed in accordance with the applicable provisions of the
formulas stated in paragraph (b) or (d) on the basis of each member's average salary under
section 354.05, subdivision 13a, for the period of the member's formula service credit.
(b) This paragraph, in conjunction with paragraph (c), applies to a person who first
became a member of the association or a member of a pension fund listed in section 356.30,
subdivision 3, before July 1, 1989, unless paragraph (d), in conjunction with paragraph (e),
produces a higher annuity amount, in which case paragraph (d) applies. The average salary
as defined in section 354.05, subdivision 13a, multiplied by the following percentages per
year of formula service credit shall determine the amount of the annuity to which the member
qualifying therefor is entitled for service rendered before July 1, 2006:
Period |
Coordinated Member |
Basic Member |
|||
Each year of service during first ten |
1.2 percent per year |
2.2 percent per year |
|||
Each year of service thereafter |
1.7 percent per year |
2.7 percent per year |
For service rendered on or after July 1, 2006, by a member other than a member who
was a member of the former Duluth Teachers Retirement Fund Association between January
1, 2006, and June 30, 2015, and for service rendered on or after July 1, 2013, by a member
who was a member of the former Duluth Teachers Retirement Fund Association between
January 1, 2013, and June 30, 2015, the average salary as defined in section 354.05,
subdivision 13a, multiplied by the following percentages per year of service credit, determines
the amount the annuity to which the member qualifying therefor is entitled:
Period |
Coordinated Member |
Basic Member |
|||
Each year of service during first ten |
1.4 percent per year |
2.2 percent per year |
|||
Each year of service after ten years of service |
1.9 percent per year |
2.7 percent per year |
(c)deleted text begin (i)deleted text end new text begin (1)new text end This paragraph applies only to a person who first became a member of the
association or a member of a pension fund listed in section 356.30, subdivision 3, before
July 1, 1989, and whose annuity is higher when calculated under paragraph (b), in conjunction
with this paragraph than when calculated under paragraph (d), in conjunction with paragraph
(e).
deleted text begin (ii)deleted text end new text begin (2)new text end Where any member retires prior to normal retirement age under a formula annuity,
the member shall be paid a retirement annuity in an amount equal to the normal annuity
provided in paragraph (b) reduced by one-quarter of one percent for each month that the
member is under normal retirement age at the time of retirement except that for any member
who has 30 or more years of allowable service credit, the reduction shall be applied only
for each month that the member is under age 62.
deleted text begin (iii)deleted text end new text begin (3)new text end Any member whose attained age plus credited allowable service totals 90 years
is entitled, upon application, to a retirement annuity in an amount equal to the normal annuity
provided in paragraph (b), without any reduction by reason of early retirement.
(d) This paragraph applies to a member who has become at least 55 years old and first
became a member of the association after June 30, 1989, and to any other member who has
become at least 55 years old and whose annuity amount when calculated under this paragraph
and in conjunction with paragraph (e), is higher than it is when calculated under paragraph
(b), in conjunction with paragraph (c).
new text begin (1)new text end For a basic member, the average salary, as defined in section 354.05, subdivision
13a, multiplied by 2.7 percent for each year of service for a basic member determines the
amount of the retirement annuity to which the basic member is entitled. The annuity of a
basic member who was a member of the former Minneapolis Teachers Retirement Fund
Association as of June 30, 2006, must be determined according to the annuity formula under
the articles of incorporation of the former Minneapolis Teachers Retirement Fund Association
in effect as of that date.
new text begin (2)new text end For a coordinated member, the average salary, as defined in section 354.05,
subdivision 13a, multiplied by 1.7 percent for each year of service rendered before July 1,
2006, and by 1.9 percent for each year of service rendered on or after July 1, 2006, for a
member other than a member who was a member of the former Duluth Teachers Retirement
Fund Association between January 1, 2006, and June 30, 2015, and by 1.9 percent for each
year of service rendered on or after July 1, 2013, for a member of the former Duluth Teachers
Retirement Fund Association between January 1, 2013, and June 30, 2015, determines the
amount of the retirement annuity to which the coordinated member is entitled.
(e) This paragraph applies to a deleted text begin persondeleted text end new text begin member new text end who has become at least 55 years old
and first becomes a member of the association after June 30, 1989, and to any other member
who has become at least 55 years old and whose annuity is higher when calculated under
paragraph (d) in conjunction with this paragraph than when calculated under paragraph (b),
in conjunction with paragraph (c). An employee who retires under the formula annuity
before the normal retirement age shall be paid the normal annuity provided in paragraph
(d) reduced so that the reduced annuity is the actuarial equivalent of the annuity that would
be payable to the employee if the employee deferred receipt of the annuity and the annuity
amount were augmented at an annual rate of three percent compounded annually from the
day the annuity begins to accrue until the normal retirement age if the employee became
an employee before July 1, 2006, and at 2.5 percent compounded annually if the employee
becomes an employee after June 30, 2006. Except in regards to section 354.46, this paragraph
remains in effect until June 30, 2015.
(f) deleted text begin Afterdeleted text end new text begin Until new text end June 30, deleted text begin 2020deleted text end new text begin 2019new text end , this paragraph applies to a deleted text begin persondeleted text end new text begin member new text end who has
become at least 55 years old and first becomes a member of the association after June 30,
1989, and to any other member who has become at least 55 years old and whose annuity is
higher when calculated under paragraph (d) in conjunction with this paragraph than when
calculated under paragraph (b) in conjunction with paragraph (c). An employee who retires
under the formula annuity before the normal retirement age is entitled to receive the normal
annuity provided in paragraph (d)new text begin , reduced as described in clause (1) or (2), as applicablenew text end .
new text begin (1)new text end For a deleted text begin persondeleted text end new text begin member new text end who is at least age 62 deleted text begin or olderdeleted text end and has at least 30 years of
service, the annuity deleted text begin mustdeleted text end new text begin shall new text end be reduced by an early reduction factor of six percent deleted text begin perdeleted text end
new text begin for each new text end year deleted text begin of the annuitydeleted text end new text begin that the member's age of retirement precedes normal retirement
age. The resulting reduced annuity shall be further adjusted to take into account the increase
in the monthly amount new text end that would deleted text begin be payable to the employee if the employeedeleted text end new text begin have occurred
had the member retired early and new text end deferred receipt of the annuity new text begin until normal retirement
age new text end and the annuity deleted text begin amount weredeleted text end new text begin was new text end augmented deleted text begin at an annual rate of three percent
compounded annually from the day the annuity begins to accrue until the normal retirement
age if the employee became an employee before July 1, 2006, anddeleted text end new text begin during the deferral period
new text end at 2.5 percent deleted text begin compounded annuallydeleted text end new text begin ,new text end if the deleted text begin employee became an employeedeleted text end new text begin member
commenced employment new text end after June 30, 2006new text begin , or at three percent, if the member commenced
employment before July 1, 2006, compounded annuallynew text end .
new text begin (2)new text end For a deleted text begin persondeleted text end new text begin member new text end who deleted text begin isdeleted text end new text begin has new text end not deleted text begin at leastdeleted text end new text begin attained new text end age 62 deleted text begin or older and does not
have at leastdeleted text end new text begin or has fewer than new text end 30 years of service, the annuity deleted text begin woulddeleted text end new text begin shall new text end be reduced new text begin for
each year that the member's age of retirement precedes the normal retirement age new text end by deleted text begin andeleted text end new text begin the
following new text end early reduction deleted text begin factor ofdeleted text end new text begin factors:
new text end
new text begin (i) for the period during which the member is age 55 through age 59, the factor is new text end four
percent deleted text begin per year for ages 55 through 59deleted text end new text begin ;new text end and
new text begin (ii) for the period during which the member is age 60 but not yet normal retirement age,
the factor isnew text end seven percent deleted text begin per year of the annuity that would be payable to the employee if
the employeedeleted text end new text begin .
new text end
new text begin The resulting reduced annuity shall be further adjusted to take into account the increase
in the monthly amount that would have occurred had the member retired early andnew text end deferred
receipt of the annuity new text begin until normal retirement age new text end and the annuity deleted text begin amount weredeleted text end new text begin was
new text end augmented deleted text begin at an annual rate of three percent compounded annually from the day the annuity
begins to accrue until the normal retirement age if the employee became an employee before
July 1, 2006, anddeleted text end new text begin during the deferral period new text end at 2.5 percent deleted text begin compounded annuallydeleted text end new text begin ,new text end if the
deleted text begin employee became an employeedeleted text end new text begin member commenced employment new text end after June 30, 2006new text begin , or
at three percent, if the member commenced employment before July 1, 2006, compounded
annuallynew text end .
(g) new text begin For members who retire on or after July 1, 2019, this paragraph applies to a person
who has become at least 55 years old and first becomes a member of the association after
June 30, 1989, and to any other member who has become at least 55 years old and whose
annuity is higher when calculated under paragraph (d) in conjunction with this paragraph
than when calculated under paragraph (b) in conjunction with paragraph (c). An employee
who retires under the formula annuity before the normal retirement age is entitled to receive
the normal annuity provided in paragraph (d), reduced as described in clause (1) or (2), as
applicable.
new text end
new text begin
(1) For a member who is at least age 62 and has at least 30 years of service, the annuity
shall be reduced by an early reduction factor of six percent for each year that the member's
age of retirement precedes the normal retirement age. The resulting reduced annuity shall
be further adjusted to take into account the increase in the monthly amount that would have
occurred had the member retired early and deferred receipt of the annuity until normal
retirement age and the annuity was augmented during the deferral period at 2.5 percent, if
the member commenced employment after June 30, 2006, or at three percent, if the member
commenced employment before July 1, 2006, compounded annually.
new text end
new text begin
(2) For a member who has not attained age 62 or has fewer than 30 years of service, the
annuity shall be reduced for each year that the member's age of retirement precedes normal
retirement age by the following early reduction factors:
new text end
new text begin
(i) for the period during which the member is age 55 through age 59, the factor is four
percent; and
new text end
new text begin
(ii) for the period during which the member is age 60 but not yet normal retirement age,
the factor is seven percent.
new text end
new text begin
The resulting annuity shall be further adjusted to take into account the increase in the
monthly amount that would have occurred had the member retired early and deferred receipt
of the annuity until normal retirement age and the annuity was augmented during the deferral
period at the applicable annual rate, compounded annually. The applicable annual rate is
the rate in effect for the month that includes the member's effective date of retirement and
shall be considered as fixed for the member for the period until the member reaches normal
retirement age. The applicable annual rate for June 2019 is 2.5 percent, if the member
commenced employment after June 30, 2006, or three percent, if the member commenced
employment before July 1, 2006, compounded annually, and decreases each month beginning
July 2019 in equal monthly increments over the five-year period that begins July 1, 2019,
and ends June 30, 2024, to zero percent effective for July 2024 and thereafter.
new text end
new text begin
After June 30, 2024, the reduced annuity commencing before normal retirement age
under this clause shall not take into account any augmentation.
new text end
new text begin (h) new text end After June 30, 2015, and before July 1, deleted text begin 2020deleted text end new text begin 2019new text end , for a person who would have a
reduced retirement annuity under either paragraph (e) or (f) if they were applicable, the
employee is entitled to receive a reduced annuity which must be calculated using a blended
reduction factor augmented monthly by 1/60 of the difference between the reduction required
under paragraph (e) and the reduction required under paragraph (f).
deleted text begin (h)deleted text end new text begin (i) new text end No retirement annuity is payable to a former employee with a salary that exceeds
95 percent of the governor's salary unless and until the salary figures used in computing the
highest five successive years average salary under paragraph (a) have been audited by the
Teachers Retirement Association and determined by the executive director to comply with
the requirements and limitations of section 354.05, subdivisions 35 and 35a.
new text begin
This section is effective July 1, 2018.
new text end
Minnesota Statutes 2016, section 354.49, subdivision 2, is amended to read:
(a) Except as provided in section 354.44, subdivision 1, any person
who ceases to be a member by reason of termination of teaching service, is entitled to receive
a refund in an amount equal to the accumulated deductions credited to the account plus
interest compounded annually using the following interest rates:
(1) before July 1, 1957, no interest accrues;
(2) July 1, 1957, to June 30, 2011, six percent; deleted text begin and
deleted text end
(3) deleted text begin after June 30deleted text end new text begin July 1new text end , 2011, new text begin to June 30, 2018, new text end four percentnew text begin ; and
new text end
new text begin (4) after June 30, 2018, three percentnew text end .
For the purpose of this subdivision, interest must be computed on fiscal year end balances
to the first day of the month in which the refund is issued.
(b) If the person has received permanent disability payments under section 354.48, the
refund amount must be reduced by the amount of those payments.
new text begin
This section is effective July 1, 2018.
new text end
Minnesota Statutes 2016, section 354.55, subdivision 11, is amended to read:
(a) Any person covered under section
354.44, subdivision 6, who ceases to render teaching service, may leave the person's
accumulated deductions in the fund for the purpose of receiving a deferred annuity at
retirement.
(b) The deleted text begin amount of thedeleted text end deferred retirement annuity deleted text begin is determined by section 354.44,
subdivision 6, anddeleted text end new text begin of any former member must be new text end augmented deleted text begin as provided in this subdivision.
The required reserves for the annuity which had accrued when the member ceased to render
teaching service must be augmented, as further specified in this subdivision, by the applicable
interest rate compounded annuallydeleted text end from the first day of the month following the deleted text begin month
during which the member ceased to render teachingdeleted text end new text begin termination of active new text end service to the
effective date of retirement.
(c) No augmentation is deleted text begin notdeleted text end creditable if the deferral period is less than three months or
if deferral commenced before July 1, 1971.
(d) For persons who became covered employees before July 1, 2006, deleted text begin with a deferral
period commencing after June 30, 1971,deleted text end the annuity must be augmented deleted text begin as followsdeleted text end new text begin at the
following rate or rates, compounded annuallynew text end :
(1) five percent deleted text begin interest compounded annuallydeleted text end until January 1, 1981;
(2) three percent deleted text begin interest compounded annuallydeleted text end from January 1, 1981, until January 1
of the year following the year in which the deferred annuitant attains age 55new text begin or June 30,
2012, whichever is earliernew text end ;
(3) five percent deleted text begin interest compounded annuallydeleted text end from the date established in clause (2) deleted text begin to
the effective date of retirement ordeleted text end until June 30, 2012deleted text begin , whichever is earlierdeleted text end ; deleted text begin and
deleted text end
(4) two percent deleted text begin interest compounded annually after June 30, 2012deleted text end new text begin from July 1, 2012,
until June 30, 2019; and
new text end
new text begin (5) after June 30, 2019, the deferred annuity must not be augmentednew text end .
(e) For persons who become covered employees after June 30, 2006, the deleted text begin interest rate
used to augment the deferreddeleted text end annuity deleted text begin isdeleted text end new text begin must be augmented at the following rate or rates,
compounded annually:
new text end
new text begin (1) new text end 2.5 percent deleted text begin interest compounded annuallydeleted text end until June 30, 2012deleted text begin , or until the effective
date of retirement, whichever is earlier, anddeleted text end new text begin ;
new text end
new text begin (2)new text end two percent deleted text begin interest compounded annually after June 30deleted text end new text begin from July 1new text end , 2012new text begin , until
June 30, 2019new text end new text begin ; and
new text end
new text begin (3) after June 30, 2019, the deferred annuity must not be augmentednew text end .
deleted text begin
(f) If a person has more than one period of uninterrupted service, a separate average
salary determined under section 354.44, subdivision 6, must be used for each period and
the required reserves related to each period must be augmented as specified in this
subdivision. The sum of the augmented required reserves is the present value of the annuity.
For the purposes of this subdivision, "period of uninterrupted service" means a period of
covered teaching service during which the member has not been separated from active
service for more than one fiscal year.
deleted text end
deleted text begin
(g) If a person repays a refund, the service restored by the repayment must be considered
as continuous with the next period of service for which the person has allowable service
credit in the Teachers Retirement Association.
deleted text end
deleted text begin
(h) If a person does not render teaching service in any one fiscal year or more consecutive
fiscal years and then resumes teaching service, the formula percentages used from the date
of the resumption of teaching service must be those applicable to new members.
deleted text end
deleted text begin
(i) The mortality table and interest rate actuarial assumption used to compute the annuity
must be the applicable mortality table established by the board under section 354.07,
subdivision 1, and the interest rate actuarial assumption under section 356.215 in effect
when the member retires.
deleted text end
deleted text begin (j)deleted text end new text begin (f) new text end In no case may the annuity payable under this subdivision be less than the amount
of annuity payable under section 354.44, subdivision 6.
deleted text begin (k)deleted text end new text begin (g) new text end The requirements and provisions for retirement before normal retirement age
contained in section 354.44, subdivision 6, also apply to an employee fulfilling the
requirements with a combination of service as provided in section deleted text begin 354.60deleted text end new text begin 356.311new text end .
deleted text begin (l)deleted text end new text begin (h) new text end The augmentation provided by this subdivision applies to the benefit provided in
section 354.46, subdivision 2.
deleted text begin (m)deleted text end new text begin (i) new text end The augmentation provided by this subdivision does not apply to any period in
which a person is on an approved leave of absence from an employer unit covered by the
provisions of this chapter.
deleted text begin (n)deleted text end new text begin (j) new text end The retirement annuity or disability benefit of, or the survivor benefit payable on
behalf of, a former teacher who terminated service before July 1, 1997, which is not first
payable until after June 30, 1997, must be increased on an actuarial equivalent basis to
reflect the change in the postretirement interest rate actuarial assumption under section
356.215, subdivision 8, from five percent to six percent under a calculation procedure and
tables adopted by the board as recommended by an approved actuary and approved by the
actuary retained under section 356.214.
new text begin
This section is effective July 1, 2018.
new text end
new text begin
Minnesota Statutes 2016, sections 354.42, subdivisions 4a, 4b, 4c, and 4d; and 354.60,
new text end
new text begin
are repealed.
new text end
new text begin
This section is effective July 1, 2018.
new text end
Minnesota Statutes 2016, section 354A.011, subdivision 3a, is amended to read:
"Actuarial equivalent" means the condition of one
annuity or benefit having an equal actuarial present value as another annuity or benefit,
determined as of a given date with each actuarial present value based on the appropriate
mortality table adopted by the appropriate board of trustees based on the experience of that
retirement fund association as recommended by the actuary retained under section 356.214,
and approved under section 356.215, subdivision 18, and using the applicable deleted text begin preretirement
or postretirement interest ratedeleted text end new text begin investment return new text end assumption specified in section 356.215,
subdivision 8.
new text begin
This section is effective July 1, 2018.
new text end
Minnesota Statutes 2016, section 354A.29, subdivision 7, is amended to read:
deleted text begin
(a) Annually, after
June 30, the board of trustees of the St. Paul Teachers Retirement Fund Association must
determine the amount of any postretirement adjustment using the procedures in this
subdivision and subdivision 8 or 9, whichever is applicable.
deleted text end
deleted text begin (b) On January 1deleted text end new text begin (a) Except as set forth in paragraph (c)new text end , each person who has been
receiving an annuity or benefit under the articles of incorporation, the bylaws, or this chapter,
whose effective date of benefit commencement occurred on or before July 1 of the calendar
year immediately before the adjustment, is eligible to receive deleted text begin adeleted text end new text begin an annual new text end postretirement
deleted text begin increase as specified in subdivision 8 or 9.deleted text end new text begin adjustment, effective as of each January 1, as
follows:
new text end
new text begin
(1) there shall be no postretirement adjustment on January 1, 2019, and January 1, 2020;
and
new text end
new text begin
(2) the postretirement adjustment shall be one percent on January 1, 2021, and each
January 1 thereafter.
new text end
new text begin
(b) The amount determined under paragraph (a), clause (2), is the full postretirement
adjustment to be applied as a permanent increase to the regular payment of each eligible
member on January 1 of the next calendar year. For any eligible member whose effective
date of benefit commencement occurred after January 1 of the calendar year immediately
before the postretirement adjustment is applied, the amount determined under paragraph
(a), clause (2), must be reduced by 50 percent.
new text end
new text begin
(c) Each person who retires on or after July 1, 2024, is entitled to an annual postretirement
adjustment, effective as of each January 1, beginning with the year following the year in
which the member attains normal retirement age.
new text end
new text begin
(d) Paragraph (c) does not apply to members who retire under section 354A.31,
subdivision 6, paragraph (b), or who retire when the member is at least age 62 and has at
least 30 years of service under section 354A.31, subdivision 7.
new text end
new text begin
This section is effective July 1, 2018.
new text end
Minnesota Statutes 2016, section 354A.31, subdivision 7, is amended to read:
(a) This subdivision applies to a person who
has become at least 55 years old and first becomes a coordinated member after June 30,
1989, and to any other coordinated member who has become at least 55 years old and whose
annuity is higher when calculated using the retirement annuity formula percentage in
subdivision 4, paragraph (d), or subdivision 4a, paragraph (d), as applicable, in conjunction
with this subdivision than when calculated under subdivision 4, paragraph (c), or subdivision
4a, paragraph (c), in conjunction with subdivision 6.new text begin An employee who retires under the
formula annuity before the normal retirement age shall be paid the normal annuity reduced
as described in paragraph (b) if the person retires on or after July 1, 2019, or in paragraph
(c) if the person retires before July 1, 2019, as applicable.
new text end
(b) A coordinated member who retires before the normal retirement age new text begin and on or after
July 1, 2019, new text end is entitled to receive a retirement annuity calculated using the retirement
annuity formula percentage in subdivision 4, paragraph (d), or subdivision 4a, paragraph
(d), whichever applies, new text begin reduced as described in clause (1) or (2), as applicable.
new text end
new text begin
(1) If the member retires when the member is younger than age 62 or with fewer than
30 years of service, the annuity must be reduced by an early reduction factor for each year
that the member's age of retirement precedes normal retirement age. The early reduction
factors are four percent per year for ages 55 through 59 and seven percent per year for ages
60 through normal retirement age. The resulting annuity must be further adjusted to take
into account augmentation as if the employee had deferred receipt of the annuity until normal
retirement age and the annuity were augmented at the applicable annual rate, compounded
annually, from the day the annuity begins to accrue until normal retirement age. The
applicable annual rate is the rate in effect on the employee's effective date of retirement and
shall be considered as fixed for the employee. The applicable annual rates are the following:
new text end
new text begin
(i) until June 30, 2019, 2.5 percent;
new text end
new text begin
(ii) a rate that changes each month, beginning July 1, 2019, through June 30, 2024, which
is determined by reducing the rate in item (i) to zero in equal monthly increments over the
five-year period; and
new text end
new text begin
(iii) after June 30, 2024, zero percent.
new text end
new text begin
After June 30, 2024, the reduced annuity commencing before normal retirement age
under this clause shall not take into account any augmentation.
new text end
new text begin
(2) If the member retires when the member is at least age 62 or older and has at least 30
years of service, the member is entitled to receive a retirement annuity calculated using the
retirement annuity formula percentage in subdivision 4, paragraph (d), or subdivision 4a,
paragraph (c), whichever applies, multiplied by the applicable early retirement factor
specified for members "Age 62 or older with 30 years of service" in the table in paragraph
(c).
new text end
new text begin (c) A coordinated member who retires before the normal retirement age and before July
1, 2019, is entitled to receive a retirement annuity calculated using the retirement annuity
formula percentage in subdivision 4, paragraph (d), or subdivision 4a, paragraph (d),
whichever applies, new text end multiplied by the applicable early retirement factor specified below:
Under age 62 |
Age 62 or older |
|
or less than 30 years of service |
with 30 years of service |
Normal retirement age: |
65 |
66 |
65 |
66 |
Age at retirement |
||||
55 |
0.5376 |
0.4592 |
||
56 |
0.5745 |
0.4992 |
||
57 |
0.6092 |
0.5370 |
||
58 |
0.6419 |
0.5726 |
||
59 |
0.6726 |
0.6062 |
||
60 |
0.7354 |
0.6726 |
||
61 |
0.7947 |
0.7354 |
||
62 |
0.8507 |
0.7947 |
0.8831 |
0.8389 |
63 |
0.9035 |
0.8507 |
0.9246 |
0.8831 |
64 |
0.9533 |
0.9035 |
0.9635 |
0.9246 |
65 |
1.0000 |
0.9533 |
1.0000 |
0.9635 |
66 |
1.0000 |
1.0000 |
For normal retirement ages between ages 65 and 66, the early retirement factors must
be determined by linear interpolation between the early retirement factors applicable for
normal retirement ages 65 and 66.
new text begin
This section is effective July 1, 2018.
new text end
Minnesota Statutes 2016, section 354A.37, subdivision 2, is amended to read:
(a) Any coordinated member
who ceases to render teaching services for the school district in which the teachers retirement
fund association is located, with sufficient allowable service credit to meet the minimum
service requirements specified in section 354A.31, subdivision 1, shall be entitled to a
deferred deleted text begin retirementdeleted text end annuity in lieu of a refund under subdivision 1.
new text begin (b)new text end The deferred deleted text begin retirementdeleted text end annuity must be deleted text begin computed under section 354A.31 and shall
bedeleted text end augmented deleted text begin as provided in this subdivisiondeleted text end new text begin from the first day of the month following the
termination of active service to the effective date of retirement. There is no augmentation
if this period is less than three monthsnew text end .
new text begin (c)new text end The deferred annuity commences upon application after the person on deferred status
attains at least the minimum age specified in section 354A.31, subdivision 1.
deleted text begin
(b) The monthly annuity amount that had accrued when the member ceased to render
teaching service must be augmented from the first day of the month following the month
during which the member ceased to render teaching service to the effective date of retirement.
There is no augmentation if this period is less than three months. The rate of augmentation
is
deleted text end
new text begin
(d) For a person who became a covered employee before July 1, 2006, the annuity must
be augmented at the following rate or rates, compounded annually:
new text end
new text begin (1) new text end three percent deleted text begin compounded annuallydeleted text end until January 1 of the year following the year
in which the former member attains age 55deleted text begin ,deleted text end new text begin or June 30, 2012, whichever is earlier;
new text end
new text begin (2) new text end five percent deleted text begin compounded annually after that date to July 1deleted text end new text begin from the January 1 next
following the attainment of age 55 or until June 30new text end , 2012deleted text begin , anddeleted text end new text begin ;
new text end
new text begin (3) new text end two percent deleted text begin compounded annually after that date to the effective date of retirement
if the employee became an employee before July 1, 2006, and atdeleted text end new text begin from July 1, 2012, until
June 30, 2019; and
new text end
new text begin
(4) after June 30, 2019, the deferred annuity must not be augmented.
new text end
new text begin
(e) For a person who became a covered employee after June 30, 2006, the annuity must
be augmented at the following rate or rates, compounded annually:
new text end
new text begin (1) new text end 2.5 percent deleted text begin compounded annually to July 1, 2012, anddeleted text end new text begin until June 30, 2012;
new text end
new text begin (2) new text end two percent deleted text begin compounded annually after that date to the effective date of retirement
if the employee became an employee after June 30, 2006. If a person has more than one
period deleted text end deleted text begin of uninterrupted service, a separate average salary determined under section 354A.31
must be used for each period, and the monthly annuity amount related to each period must
be augmented as provided in this subdivision. The sum of the augmented monthly annuity
amounts determines the total deferred annuity payable. If a person repays a refund, the
service restored by the repayment must be considered as continuous with the next period
of service for which the person has credit with the fund. If a person does not render teaching
services in any one fiscal year or more consecutive fiscal years and then resumes teaching
service, the formula percentages used from the date of resumption of teaching service are
those applicable to new members. The mortality table and interest assumption used to
compute the annuity are the table established by the fund to compute other annuities, and
the interest assumption under section 356.215 in effect when the member retires. A period
of uninterrupted service for the purpose of this subdivision means a period of covered
teaching service during which the member has not been separated from active service for
more than one fiscal year.deleted text end new text begin from July 1, 2012, until June 30, 2019; and
new text end
new text begin
(3) after June 30, 2019, the deferred annuity must not be augmented.
new text end
deleted text begin (c)deleted text end new text begin (f)new text end The augmentation provided by this subdivision applies to the benefit provided in
section 354A.35, subdivision 2. The augmentation provided by this subdivision does not
apply to any period in which a person is on an approved leave of absence from an employer
unit.
new text begin
This section is effective July 1, 2018.
new text end
Minnesota Statutes 2016, section 354A.37, subdivision 3, is amended to read:
A former coordinated member who qualifies
for a refund under subdivision 1 is entitled to receive a refund equal to the amount of the
former coordinated member's accumulated employee contributions with interest at the deleted text begin rate
ofdeleted text end new text begin following rates for the applicable period:
new text end
new text begin (1) new text end Six percent per annum compounded annually to July 1, 2011deleted text begin , if the person is a former
member of the St. Paul Teachers Retirement Fund Association, anddeleted text end new text begin ;
new text end
new text begin (2)new text end four percent per annum compounded annually new text begin to July 1, 2018; and
new text end
new text begin (3) three percent per annum compounded annually new text end thereafter.
new text begin
This section is effective July 1, 2018.
new text end
new text begin
(a)
new text end
new text begin
Minnesota Statutes 2016, section 354A.29, subdivisions 8 and 9,
new text end
new text begin
are repealed.
new text end
new text begin
(b)
new text end
new text begin
Minnesota Statutes 2016, section 354A.39,
new text end
new text begin
is repealed.
new text end
new text begin
Paragraph (a) is effective the day following final enactment.
Paragraph (b) is effective July 1, 2018.
new text end
Minnesota Statutes 2017 Supplement, section 356.215, subdivision 8, is amended
to read:
(a) The actuarial valuation must
use the applicable following deleted text begin interestdeleted text end new text begin investment returnnew text end assumption:
deleted text begin
(1) select and ultimate interest rate assumption
deleted text end
deleted text begin
plan deleted text end |
deleted text begin
ultimate interest rate assumption deleted text end |
|
deleted text begin
teachers retirement plan deleted text end |
deleted text begin
8.5% deleted text end |
deleted text begin
The select preretirement interest rate assumption for the period through June 30, 2017,
is eight percent.
deleted text end
deleted text begin
(2) single rate interest rate assumption
deleted text end
plan |
deleted text begin interest ratedeleted text end new text begin investment returnnew text end assumption |
|
general state employees retirement plan |
deleted text begin 8deleted text end new text begin 7.5new text end % |
|
correctional state employees retirement plan |
deleted text begin
8
deleted text end
new text begin
7.5 new text end |
|
State Patrol retirement plan |
deleted text begin
8
deleted text end
new text begin
7.5 new text end |
|
legislators retirement plan, and for the constitutional officers calculation of total plan liabilities |
0 |
|
judges retirement plan |
deleted text begin
8
deleted text end
new text begin
7.5 new text end |
|
general public employees retirement plan |
deleted text begin
8
deleted text end
new text begin
7.5 new text end |
|
public employees police and fire retirement plan |
deleted text begin
8
deleted text end
new text begin
7.5 new text end |
|
local government correctional service retirement plan |
deleted text begin
8
deleted text end
new text begin
7.5 new text end |
|
new text begin
teachers retirement plan new text end |
new text begin
7.5 new text end |
|
St. Paul teachers retirement plan |
deleted text begin
8
deleted text end
new text begin
7.5 new text end |
|
Bloomington Fire Department Relief Association |
6 |
|
local monthly benefit volunteer firefighter relief associations |
5 |
|
monthly benefit retirement plans in the statewide volunteer firefighter retirement plan |
6 |
(b)deleted text begin (1) If funding stability has been attained,deleted text end The new text begin actuarial new text end valuation new text begin for each of the
covered retirement plans listed in section 356.415, subdivision 2, new text end must deleted text begin use adeleted text end new text begin take into account
thenew text end postretirement adjustment rate deleted text begin actuarial assumption equal to the postretirement adjustment
ratedeleted text end new text begin or rates applicable to the plan asnew text end specified in section 354A.29, subdivision deleted text begin 9deleted text end new text begin 7new text end , or
356.415deleted text begin , subdivision 1deleted text end , whichever applies.
deleted text begin
(2) If funding stability has not been attained, the valuation must use a select postretirement
adjustment rate actuarial assumption equal to the postretirement adjustment rate specified
deleted text end
deleted text begin
in section 354A.29, subdivision 8, or 356.415, subdivision 1a, 1b, 1c, 1d, 1e, or 1f, whichever
applies, for a period ending when the approved actuary estimates that the plan will attain
the defined funding stability measure, and thereafter an ultimate postretirement adjustment
rate actuarial assumption equal to the postretirement adjustment rate under section 354A.29,
subdivision 9, or 356.415, subdivision 1, for the applicable period or periods beginning
when funding stability is projected to be attained.
deleted text end
(c) The actuarial valuation must use the applicable following single rate future salary
increase assumption, the applicable following modified single rate future salary increase
assumption, or the applicable following graded rate future salary increase assumption:
(1) single rate future salary increase assumption
plan |
future salary increase assumption |
|
legislators retirement plan |
5% |
|
judges retirement plan |
2.75 |
|
Bloomington Fire Department Relief Association |
4 |
(2) age-related future salary increase age-related select and ultimate future salary increase
assumption or graded rate future salary increase assumption
plan |
future salary increase assumption |
local government correctional service retirement plan |
assumption B |
St. Paul teachers retirement plan |
assumption A |
For plans other than the St. Paul teachers
retirement plan and the local government
correctional service retirement plan, the select
calculation is: during the designated select
period, a designated percentage rate is
multiplied by the result of the designated
integer minus T, where T is the number of
completed years of service, and is added to
the applicable future salary increase
assumption. The designated select period is
ten years and the designated integer is ten for
the local government correctional service
retirement plan and 15 for the St. Paul
Teachers Retirement Fund Association. The
designated percentage rate is 0.2 percent for
the St. Paul Teachers Retirement Fund
Association.
The ultimate future salary increase assumption is:
age |
A |
B |
|
16 |
5.9% |
8.75% |
|
17 |
5.9 |
8.75 |
|
18 |
5.9 |
8.75 |
|
19 |
5.9 |
8.75 |
|
20 |
5.9 |
8.75 |
|
21 |
5.9 |
8.5 |
|
22 |
5.9 |
8.25 |
|
23 |
5.85 |
8 |
|
24 |
5.8 |
7.75 |
|
25 |
5.75 |
7.5 |
|
26 |
5.7 |
7.25 |
|
27 |
5.65 |
7 |
|
28 |
5.6 |
6.75 |
|
29 |
5.55 |
6.5 |
|
30 |
5.5 |
6.5 |
|
31 |
5.45 |
6.25 |
|
32 |
5.4 |
6.25 |
|
33 |
5.35 |
6.25 |
|
34 |
5.3 |
6 |
|
35 |
5.25 |
6 |
|
36 |
5.2 |
5.75 |
|
37 |
5.15 |
5.75 |
|
38 |
5.1 |
5.75 |
|
39 |
5.05 |
5.5 |
|
40 |
5 |
5.5 |
|
41 |
4.95 |
5.5 |
|
42 |
4.9 |
5.25 |
|
43 |
4.85 |
5 |
|
44 |
4.8 |
5 |
|
45 |
4.75 |
4.75 |
|
46 |
4.7 |
4.75 |
|
47 |
4.65 |
4.75 |
|
48 |
4.6 |
4.75 |
|
49 |
4.55 |
4.75 |
|
50 |
4.5 |
4.75 |
|
51 |
4.45 |
4.75 |
|
52 |
4.4 |
4.75 |
|
53 |
4.35 |
4.75 |
|
54 |
4.3 |
4.75 |
|
55 |
4.25 |
4.5 |
|
56 |
4.2 |
4.5 |
|
57 |
4.15 |
4.25 |
|
58 |
4.1 |
4 |
|
59 |
4.05 |
4 |
|
60 |
4 |
4 |
|
61 |
4 |
4 |
|
62 |
4 |
4 |
|
63 |
4 |
4 |
|
64 |
4 |
4 |
|
65 |
4 |
3.75 |
|
66 |
4 |
3.75 |
|
67 |
4 |
3.75 |
|
68 |
4 |
3.75 |
|
69 |
4 |
3.75 |
|
70 |
4 |
3.75 |
(3) service-related ultimate future salary increase assumption
general state employees retirement plan of the Minnesota State Retirement System |
assumption A |
general employees retirement plan of the Public Employees Retirement Association |
assumption B |
Teachers Retirement Association |
assumption C |
public employees police and fire retirement plan |
assumption D |
State Patrol retirement plan |
assumption E |
correctional state employees retirement plan of the Minnesota State Retirement System |
assumption F |
service length |
A |
B |
C |
D |
E |
F |
1 |
10.25% |
11.78% |
12% |
12.75% |
7.75% |
5.75% |
2 |
7.85 |
8.65 |
9 |
10.75 |
7.25 |
5.6 |
3 |
6.65 |
7.21 |
8 |
8.75 |
6.75 |
5.45 |
4 |
5.95 |
6.33 |
7.5 |
7.75 |
6.5 |
5.3 |
5 |
5.45 |
5.72 |
7.25 |
6.25 |
6.25 |
5.15 |
6 |
5.05 |
5.27 |
7 |
5.85 |
6 |
5 |
7 |
4.75 |
4.91 |
6.85 |
5.55 |
5.75 |
4.85 |
8 |
4.45 |
4.62 |
6.7 |
5.35 |
5.6 |
4.7 |
9 |
4.25 |
4.38 |
6.55 |
5.15 |
5.45 |
4.55 |
10 |
4.15 |
4.17 |
6.4 |
5.05 |
5.3 |
4.4 |
11 |
3.95 |
3.99 |
6.25 |
4.95 |
5.15 |
4.3 |
12 |
3.85 |
3.83 |
6 |
4.85 |
5 |
4.2 |
13 |
3.75 |
3.69 |
5.75 |
4.75 |
4.85 |
4.1 |
14 |
3.55 |
3.57 |
5.5 |
4.65 |
4.7 |
4 |
15 |
3.45 |
3.45 |
5.25 |
4.55 |
4.55 |
3.9 |
16 |
3.35 |
3.35 |
5 |
4.55 |
4.4 |
3.8 |
17 |
3.25 |
3.26 |
4.75 |
4.55 |
4.25 |
3.7 |
18 |
3.25 |
3.25 |
4.5 |
4.55 |
4.1 |
3.6 |
19 |
3.25 |
3.25 |
4.25 |
4.55 |
3.95 |
3.5 |
20 |
3.25 |
3.25 |
4 |
4.55 |
3.8 |
3.5 |
21 |
3.25 |
3.25 |
3.9 |
4.45 |
3.75 |
3.5 |
22 |
3.25 |
3.25 |
3.8 |
4.35 |
3.75 |
3.5 |
23 |
3.25 |
3.25 |
3.7 |
4.25 |
3.75 |
3.5 |
24 |
3.25 |
3.25 |
3.6 |
4.25 |
3.75 |
3.5 |
25 |
3.25 |
3.25 |
3.5 |
4.25 |
3.75 |
3.5 |
26 |
3.25 |
3.25 |
3.5 |
4.25 |
3.75 |
3.5 |
27 |
3.25 |
3.25 |
3.5 |
4.25 |
3.75 |
3.5 |
28 |
3.25 |
3.25 |
3.5 |
4.25 |
3.75 |
3.5 |
29 |
3.25 |
3.25 |
3.5 |
4.25 |
3.75 |
3.5 |
30 or more |
3.25 |
3.25 |
3.5 |
4.25 |
3.75 |
3.5 |
(d) The actuarial valuation must use the applicable following payroll growth assumption
for calculating the amortization requirement for the unfunded actuarial accrued liability
where the amortization retirement is calculated as a level percentage of an increasing payroll:
plan |
payroll growth assumption |
general state employees retirement plan of the Minnesota State Retirement System |
3.5% |
correctional state employees retirement plan |
3.5 |
State Patrol retirement plan |
3.5 |
judges retirement plan |
2.75 |
general employees retirement plan of the Public Employees Retirement Association |
3.5 |
public employees police and fire retirement plan |
3.5 |
local government correctional service retirement plan |
3.5 |
teachers retirement plan |
3.75 |
St. Paul teachers retirement plan |
4 |
(e) The assumptions set forth in paragraphs (c) and (d) continue to apply, unless a
different salary assumption or a different payroll increase assumption:
(1) has been proposed by the governing board of the applicable retirement plan;
(2) is accompanied by the concurring recommendation of the actuary retained under
section 356.214, subdivision 1, if applicable, or by the approved actuary preparing the most
recent actuarial valuation report if section 356.214 does not apply; and
(3) has been approved or deemed approved under subdivision 18.
new text begin
This section is effective July 1, 2018.
new text end
Minnesota Statutes 2016, section 356.215, subdivision 9, is amended to read:
deleted text begin Thedeleted text end new text begin (a) Each plan's new text end actuarial valuation must use
assumptions concerning new text begin base new text end mortalitynew text begin ratesnew text end , disability, retirement, withdrawal, retirement
age, and any other relevant demographic or economic factor. These assumptions must be
set at levels consistent with those determined in the most recent quadrennial experience
study completed under subdivision 16, if required, or deleted text begin representative of the best estimate of
future experiencedeleted text end new text begin as recommended by the plan's approved actuarynew text end , if a quadrennial experience
study is not required.
new text begin
(b) The actuarial valuation may use an assumption concerning future mortality
improvement. This assumption may be set at levels consistent with those determined in the
most recent mortality improvement scale published by the Society of Actuaries or as
otherwise recommended by the plan's approved actuary.
new text end
new text begin (c)new text end The actuarial valuation must contain an exhibit indicating deleted text begin anydeleted text end new text begin the new text end actuarial
assumptions used in preparing the valuation report.
new text begin
This section is effective July 1, 2018.
new text end
Minnesota Statutes 2016, section 356.215, subdivision 11, is amended to read:
(a) In addition to the exhibit indicating the level
normal cost, the actuarial valuation of the retirement plan must contain an exhibit for financial
reporting purposes indicating the additional annual contribution sufficient to amortize the
unfunded actuarial accrued liability and must contain an exhibit for contribution
determination purposes indicating the additional contribution sufficient to amortize the
unfunded actuarial accrued liability. For the retirement plans listed in subdivision 8, paragraph
(c), but excluding the legislators retirement plan, the additional contribution must be
calculated on a level percentage of covered payroll basis by the established date for full
funding in effect when the valuation is prepared, assuming annual payroll growth at the
applicable percentage rate set forth in subdivision 8, paragraph (d). For all other retirement
plans and for the legislators retirement plan, the additional annual contribution must be
calculated on a level annual dollar amount basis.
(b) For any retirement plan other than a retirement plan governed by paragraph (d), (e),
(f), (g), (h), (i), or (j), if there has not been a change in the actuarial assumptions used for
calculating the actuarial accrued liability of the fund, a change in the benefit plan governing
annuities and benefits payable from the fund, a change in the actuarial cost method used in
calculating the actuarial accrued liability of all or a portion of the fund, or a combination
of the three, which change or changes by itself or by themselves without inclusion of any
other items of increase or decrease produce a net increase in the unfunded actuarial accrued
liability of the fund, the established date for full funding is the first actuarial valuation date
occurring after June 1, 2020.
(c) For any retirement plan, if there has been a change in any or all of the actuarial
assumptions used for calculating the actuarial accrued liability of the fund, a change in the
benefit plan governing annuities and benefits payable from the fund, a change in the actuarial
cost method used in calculating the actuarial accrued liability of all or a portion of the fund,
or a combination of the three, and the change or changes, by itself or by themselves and
without inclusion of any other items of increase or decrease, produce a net increase in the
unfunded actuarial accrued liability in the fund, the established date for full funding must
be determined using the following procedure:
(i) the unfunded actuarial accrued liability of the fund must be determined in accordance
with the plan provisions governing annuities and retirement benefits and the actuarial
assumptions in effect before an applicable change;
(ii) the level annual dollar contribution or level percentage, whichever is applicable,
needed to amortize the unfunded actuarial accrued liability amount determined under item
(i) by the established date for full funding in effect before the change must be calculated
using the interest assumption specified in subdivision 8 in effect before the change;
(iii) the unfunded actuarial accrued liability of the fund must be determined in accordance
with any new plan provisions governing annuities and benefits payable from the fund and
any new actuarial assumptions and the remaining plan provisions governing annuities and
benefits payable from the fund and actuarial assumptions in effect before the change;
(iv) the level annual dollar contribution or level percentage, whichever is applicable,
needed to amortize the difference between the unfunded actuarial accrued liability amount
calculated under item (i) and the unfunded actuarial accrued liability amount calculated
under item (iii) over a period of 30 years from the end of the plan year in which the applicable
change is effective must be calculated using the applicable interest assumption specified in
subdivision 8 in effect after any applicable change;
(v) the level annual dollar or level percentage amortization contribution under item (iv)
must be added to the level annual dollar amortization contribution or level percentage
calculated under item (ii);
(vi) the period in which the unfunded actuarial accrued liability amount determined in
item (iii) is amortized by the total level annual dollar or level percentage amortization
contribution computed under item (v) must be calculated using the interest assumption
specified in subdivision 8 in effect after any applicable change, rounded to the nearest
integral number of years, but not to exceed 30 years from the end of the plan year in which
the determination of the established date for full funding using the procedure set forth in
this clause is made and not to be less than the period of years beginning in the plan year in
which the determination of the established date for full funding using the procedure set forth
in this clause is made and ending by the date for full funding in effect before the change;
and
(vii) the period determined under item (vi) must be added to the date as of which the
actuarial valuation was prepared and the date obtained is the new established date for full
funding.
(d) For the general employees retirement plan of the Public Employees Retirement
Association, the established date for full funding is June 30, deleted text begin 2031deleted text end new text begin 2048new text end .
(e) For the Teachers Retirement Association, the established date for full funding is June
30, deleted text begin 2037deleted text end new text begin 2048new text end .
(f) For the correctional state employees retirement plan new text begin and the State Patrol retirement
plan new text end of the Minnesota State Retirement System, the established date for full funding is June
30, deleted text begin 2038deleted text end new text begin 2048new text end .
(g) For the judges retirement plan, the established date for full funding is June 30, deleted text begin 2038deleted text end new text begin
2048new text end .
(h) For the new text begin local government correctional service retirement plan and the new text end public employees
police and fire retirement plan, the established date for full funding is June 30, deleted text begin 2038deleted text end new text begin 2048new text end .
(i) For the St. Paul Teachers Retirement Fund Association, the established date for full
funding is June 30, deleted text begin 2042. In addition to other requirements of this chapter, the annual
actuarial valuation must contain an exhibit indicating the funded ratio and the deficiency
or sufficiency in annual contributions when comparing liabilities to the market value of the
assets of the fund as of the close of the most recent fiscal yeardeleted text end new text begin 2048new text end .
(j) For the general state employees retirement plan of the Minnesota State Retirement
System, the established date for full funding is June 30, deleted text begin 2040deleted text end new text begin 2048new text end .
(k) For the retirement plans for which the annual actuarial valuation indicates an excess
of valuation assets over the actuarial accrued liability, the valuation assets in excess of the
actuarial accrued liability must be recognized as a reduction in the current contribution
requirements by an amount equal to the amortization of the excess expressed as a level
percentage of pay over a 30-year period beginning anew with each annual actuarial valuation
of the plan.
new text begin
This section is effective July 1, 2018.
new text end
Minnesota Statutes 2016, section 356.30, subdivision 1, is amended to read:
(a) Notwithstanding any provisions
of the laws governing the new text begin covered new text end retirement plans deleted text begin enumerateddeleted text end new text begin listed new text end in subdivision 3, a
person deleted text begin who has met the qualifications of paragraph (b)deleted text end may elect to receivenew text begin , upon retirement,new text end
a retirement annuity from each deleted text begin enumerateddeleted text end new text begin covered new text end retirement plan deleted text begin in which the person has
at least one-half year of allowable service, based on the allowable service in each plandeleted text end ,
subject to the provisions of paragraph deleted text begin (c).deleted text end new text begin (b), if the person has:
new text end
new text begin
(1) allowable service in any two or more of the covered plans;
new text end
new text begin
(2) at least one-half year of allowable service in each covered plan, based on the allowable
service in each plan;
new text end
new text begin
(3) total allowable service that equals or exceeds the longest service credit vesting
requirement of the applicable retirement plan; and
new text end
new text begin
(4) not begun to receive an annuity from any covered plan or has made application for
benefits from each applicable plan and the retirement annuity effective dates of each plan
are within a one-year period.
new text end
deleted text begin
(b) A person may receive, upon retirement, a retirement annuity from each enumerated
retirement plan in which the person has at least one-half year of allowable service, and
augmentation of a deferred annuity calculated at the appropriate rate under the laws governing
each public pension plan or fund named in subdivision 3, based on the date of the person's
initial entry into public employment from the date the person terminated all public service
if:
deleted text end
deleted text begin
(1) the person has allowable service in any two or more of the enumerated plans;
deleted text end
deleted text begin
(2) the person has sufficient allowable service in total that equals or exceeds the applicable
service credit vesting requirement of the retirement plan with the longest applicable service
credit vesting requirement; and
deleted text end
deleted text begin
(3) the person has not begun to receive an annuity from any enumerated plan or the
person has made application for benefits from each applicable plan and the effective dates
of the retirement annuity with each plan under which the person chooses to receive an
annuity are within a one-year period.
deleted text end
deleted text begin (c)deleted text end new text begin (b) If all requirements in paragraph (a) have been satisfied, new text end the retirement annuity
from each plan must be based upon the allowable service, accrual rates, and average salary
in the applicable plan except as further specified or modified in the following clauses:
(1) the laws governing annuities must be the law in effect on the date of termination
from the last period of public service under a covered retirement plan with which the person
earned a minimum of one-half year of allowable service credit during that employment;
(2) the deleted text begin "deleted text end average salarydeleted text begin " on which the annuity from each covered plan in which the
employee has credit in adeleted text end new text begin used to calculate the annuity for each new text end formula plan must be based
on the employee's highest five successive years of covered salary during the entire service
in covered plans;
(3) the accrual rates deleted text begin to be used bydeleted text end new text begin under new text end each plan must be deleted text begin thosedeleted text end new text begin the new text end percentages
prescribed by each plan's formula deleted text begin as continueddeleted text end new text begin in effect new text end for the respective years of allowable
service from one plan to the next, recognizing all previous allowable service with the other
covered plans;
(4) the allowable service in all the new text begin covered new text end plans must be combined in determining
eligibility for and the application of each plan's provisions deleted text begin indeleted text end new text begin with new text end respect to reduction in
the annuity amount for retirement prior to normal retirement age; and
(5) the annuity amount payable for any allowable service under a nonformula plan deleted text begin ofdeleted text end
new text begin that is new text end a covered plan must not be affected, but such service and covered salary must be
used in the above calculation.
new text begin
(c) If a person eligible for an annuity under paragraph (a) from each covered plan
terminates all public service, the deferred annuity must be augmented from the date of
termination until the earlier of:
new text end
new text begin
(1) the effective date of retirement; or
new text end
new text begin
(2) December 31, 2018, for the Minnesota State Retirement System and the Public
Employees Retirement Association or June 30, 2019, for the Teachers Retirement Association
and the St. Paul Teachers Retirement Association.
new text end
new text begin
A deferred annuity must not be augmented after the applicable dates under clause (2).
The appropriate rate of augmentation is the rate in effect on the date on which the person
entered into public employment and subsequently adjusted according to the laws governing
each covered plan, as applicable.
new text end
(d) This section does not apply to any person whose final termination from the last public
service under a covered plan was before May 1, 1975.
(e) For the purpose of computing annuities under this sectiondeleted text begin , the accrual rates used by
any covered plan, except the public employees police and fire plan, the judges retirement
fund, and the State Patrol retirement plan, must not exceed 2.7 percent per year of service
for any year of service or fraction thereof. The formula percentage used bydeleted text end new text begin :
new text end
new text begin (1)new text end the judges retirement fund new text begin accrual rate new text end must not exceed 3.2 percent per year of service
for any year of service or fraction thereofdeleted text begin . The accrual rate used bydeleted text end new text begin ;
new text end
new text begin (2)new text end the public employees police and fire plan and the State Patrol retirement plan new text begin accrual
rate new text end must not exceed 3.0 percent per year of service for any year of service or fraction
thereofdeleted text begin . The accrual rate or rates used bydeleted text end new text begin ;
new text end
new text begin (3)new text end the legislators retirement plan new text begin accrual rate new text end must not exceed 2.5 percent, but this limit
does not apply to the adjustment provided under section 3A.02, subdivision 1, paragraph
(c)deleted text begin .deleted text end new text begin ; and
new text end
new text begin
(4) any other covered plan's accrual rate must not exceed 2.7 percent per year of service
for any year of service or fraction thereof.
new text end
(f) Any period of time for which a person has credit in more than one of the covered
plans must be used only once for the purpose of determining total allowable service.
(g) If the period of duplicated service credit is more than one-half year, or the person
has credit for more than one-half year, with each of the plans, each plan must apply its
formula to a prorated service credit for the period of duplicated service based on a fraction
of the salary on which deductions were paid to that fund for the period divided by the total
salary on which deductions were paid to all plans for the period.
(h) If the period of duplicated service credit is less than one-half year, or when added
to other service credit with that plan is less than one-half year, the service credit must be
ignored and a refund of contributions made to the person in accord with that plan's refund
provisions.
new text begin
This section is effective July 1, 2018.
new text end
new text begin
() Any person who has been a member of two or more of the retirement plans listed in
paragraph (b) is entitled, when qualified, to an annuity from each fund if:
new text end
new text begin
(1) the person's combined service in any two or more retirement plans equals or exceeds
the vesting requirement of the fund with the longest vesting requirement; and
new text end
new text begin
(2) the person has not taken a refund from any of the retirement plans.
new text end
new text begin
(b) This section applies to any defined benefit plan administered by the Minnesota State
Retirement System, including the State Patrol Retirement Plan; the Public Employees
Retirement Association, including the public employees police and fire plan; the Teachers
Retirement Association; and the St. Paul Teachers Retirement Fund Association, except as
noted in paragraph (c).
new text end
new text begin
(c) This section does not apply to plans providing benefits for police officers or
firefighters under sections 424A.091 to 424A.096 or the Bloomington Fire Department
Relief Association.
new text end
new text begin
(d) No portion of the service upon which the retirement annuity from one retirement
plan is based shall be again used in the computation of a retirement annuity from another
plan. The annuity from each plan must be determined under the laws applicable to that plan
except that the requirement that a person meet the vesting requirement in any particular
plan shall not apply, provided the combined service in any two or more plans equals or
exceeds the vesting requirement of the plan with the longest vesting requirement.
new text end
new text begin
(e) Any deferred annuity payable under this section shall be subject to augmentation
under the laws applicable to the deferred annuity.
new text end
new text begin
(f) Any person to whom an annuity is not payable under this section because the person
took a refund from one of the funds shall be entitled to repay the refund in accordance with
the laws governing the refund. Upon repayment, the person is entitled to annuities under
this section, if the person would otherwise be entitled.
new text end
new text begin
This section is effective July 1, 2018.
new text end
Minnesota Statutes 2016, section 356.415, subdivision 1, is amended to read:
(a) Except as deleted text begin otherwise
provided in subdivision 1a, 1b, 1c, 1d, 1e, or 1fdeleted text end new text begin set forth in paragraph (c)new text end , new text begin recipients of a
new text end retirement annuity, disability benefit, or survivor benefit deleted text begin recipients of a covereddeleted text end new text begin from the
general state employees new text end retirement plannew text begin , the legislators retirement plan, or the unclassified
state employees retirement programnew text end are entitled to deleted text begin adeleted text end new text begin an annual new text end postretirement adjustment
deleted text begin annually ondeleted text end new text begin , effective as of eachnew text end January 1, as follows:
(1) new text begin effective January 1, 2019, through December 31, 2023, new text end a postretirement increase of
deleted text begin 2.5deleted text end new text begin one new text end percent must be applied each yeardeleted text begin , effective January 1,deleted text end to the new text begin amount of the new text end monthly
annuity or benefit of each annuitant or benefit recipient who has been receiving an annuity
or a benefit for at least 12 full months as of the June 30 of the calendar year immediately
before the adjustment; deleted text begin and
deleted text end
(2) new text begin effective January 1, 2019, through December 31, 2023, new text end for each annuitant or benefit
recipient who has been receiving an annuity or a benefit deleted text begin amountdeleted text end for at least one full month,
but less than 12 full months as of the June 30 of the calendar year immediately before the
adjustment, deleted text begin an annualdeleted text end new text begin a new text end postretirement increase of 1/12 of deleted text begin 2.5deleted text end new text begin one new text end percent for each month
that the person has been receiving an annuity or benefit must be applieddeleted text begin .deleted text end new text begin to the amount of
the monthly annuity or benefit of the annuitant or benefit recipient;
new text end
new text begin
(3) effective January 1, 2024, and thereafter, a postretirement increase of 1.5 percent
must be applied each year to the amount of the monthly annuity or benefit of each annuitant
or benefit recipient who has been receiving an annuity or a benefit for at least 12 full months
as of the June 30 of the calendar year immediately before the adjustment; and
new text end
new text begin
(4) effective January 1, 2024, and thereafter, for each annuitant or benefit recipient who
has been receiving an annuity or a benefit for at least one full month, but less than 12 full
months as of the June 30 of the calendar year immediately before the adjustment, an annual
postretirement increase of 1/12 of 1.5 percent for each month that the person has been
receiving an annuity or benefit must be applied to the amount of the monthly annuity or
benefit of the annuitant or benefit recipient.
new text end
(b) An increase in annuity or benefit payments under this deleted text begin sectiondeleted text end new text begin subdivision new text end must be
made automatically unless written notice is filed by the annuitant or benefit recipient with
the executive director of the covered retirement plan requesting that the increase not be
made.
new text begin
(c) Members who retire on or after January 1, 2024, under the general state employees
retirement plan, the legislators retirement plan, or the unclassified state employees retirement
program are entitled to an annual postretirement adjustment of the member's retirement
annuity, effective as of each January 1, beginning with the year following the year in which
the member attains normal retirement age, as follows:
new text end
new text begin
(1) if a member has been receiving an annuity for at least 12 full months as of the June
30 of the calendar year immediately before the date of the adjustment, a postretirement
increase equal to the percentage specified in paragraph (a), clause (3), must be applied,
effective on January 1, to the amount of the member's monthly annuity;
new text end
new text begin
(2) if a member has been receiving an annuity for at least one full month, but less than
12 full months as of the June 30 of the calendar year immediately before the date of
adjustment, a postretirement increase of 1/12 of the percentage specified in paragraph (a),
clause (4), for each month that the member has been receiving an annuity must be applied,
effective on January 1, to the amount of the member's monthly annuity; or
new text end
new text begin
(3) if a member has been receiving an annuity for fewer than seven months before the
date of adjustment, a postretirement increase shall not be applied until the next January 1
and the amount of the adjustment shall be the amount determined under clause (2).
new text end
new text begin
(d) Paragraph (c) does not apply to members who retire under section 352.116,
subdivision 1, paragraph (c).
new text end
new text begin
This section is effective July 1, 2018.
new text end
Minnesota Statutes 2016, section 356.415, subdivision 1a, is amended to read:
(a)
Retirement annuity, disability benefit, or survivor benefit recipients of the deleted text begin legislators
retirement plan, including constitutional officers as specified in chapter 3A, the general
state employees retirement plan, thedeleted text end correctional state employees retirement plandeleted text begin , and the
unclassified state employees retirement programdeleted text end are entitled to deleted text begin adeleted text end new text begin an annual new text end postretirement
adjustment deleted text begin annually ondeleted text end new text begin , effective as of eachnew text end January 1, as follows:
(1) deleted text begin for each successive January 1, if the definition of funding stability under paragraph
(b) has not been met as of the prior July 1 for or with respect to the applicable retirement
plan,deleted text end a postretirement increase of deleted text begin twodeleted text end new text begin 1.5 new text end percent must be applied each yeardeleted text begin , effective on
January 1,deleted text end to the monthly annuity or benefit of each annuitant or benefit recipient who has
been receiving an annuity or a benefit for at least 12 full months as of the June 30 of the
calendar year immediately before the adjustment; and
(2) deleted text begin for each successive January 1, if the definition of funding stability under paragraph
(b) has not been met as of the prior July 1 for or with respect to the applicable retirement
plan,deleted text end for each annuitant or benefit recipient who has been receiving an annuity or a benefit
for at least one full month, but less than 12 full months as of the June 30 of the calendar
year immediately before the adjustment, an annual postretirement increase of 1/12 of deleted text begin twodeleted text end
new text begin 1.5 new text end percent for each month that the person has been receiving an annuity or benefit must
be appliednew text begin to the amount of the monthly annuity or benefit of each annuitant or benefit
recipientnew text end .
deleted text begin
(b) Increases under this subdivision for the general state employees retirement plan or
the correctional state employees retirement plan terminate on December 31 of the calendar
year in which two prior consecutive actuarial valuations prepared by the approved actuary
under sections 356.214 and 356.215 and the standards for actuarial work promulgated by
the Legislative Commission on Pensions and Retirement indicate that the market value of
assets of the retirement plan equals or exceeds 90 percent of the actuarial accrued liability
of the retirement plan and increases under subdivision 1 recommence after that date. Increases
under this subdivision for the legislators retirement plan established under chapter 3A,
including the constitutional officers specified in that chapter, and for the unclassified state
employees retirement program, terminate on December 31 of the calendar year in which
two prior consecutive actuarial valuations prepared by the approved actuary under sections
356.214 and 356.215 and the standards for actuarial work promulgated by the Legislative
Commission on Pensions and Retirement indicate that the market value of assets of the
general state employees retirement plan equals or exceeds 90 percent of the actuarial accrued
liability of the retirement plan and increases under subdivision 1 recommence after that
date.
deleted text end
deleted text begin
(c) After having met the definition of funding stability under paragraph (b), the increase
provided in paragraph (a), clauses (1) and (2), rather than an increase under subdivision 1,
for the general state employees retirement plan or the correctional state employees retirement
plan, is again to be applied in a subsequent year or years if the market value of assets of the
applicable plan equals or is less than:
deleted text end
deleted text begin
(1) 85 percent of the actuarial accrued liabilities of the applicable plan for two consecutive
actuarial valuations; or
deleted text end
deleted text begin
(2) 80 percent of the actuarial accrued liabilities of the applicable plan for the most recent
actuarial valuation.
deleted text end
deleted text begin
(d) After having met the definition of funding stability under paragraph (b), the increase
provided in paragraph (a), clauses (1) and (2), rather than an increase under subdivision 1,
for the legislators retirement plan, including the constitutional officers, and for the
unclassified state employees retirement program, is again to be applied in a subsequent year
or years if the market value of assets of the general state employees retirement plan equals
or is less than:
deleted text end
deleted text begin
(1) 85 percent of the actuarial accrued liabilities of the applicable plan for two consecutive
actuarial valuations; or
deleted text end
deleted text begin
(2) 80 percent of the actuarial accrued liabilities of the applicable plan for the most recent
actuarial valuation.
deleted text end
deleted text begin (e)deleted text end new text begin (b) new text end An increase in annuity or benefit payments under this subdivision must be made
automatically unless written notice is filed by the annuitant or benefit recipient with the
executive director of the applicable covered retirement plan requesting that the increase not
be made.
new text begin
This section is effective July 1, 2018.
new text end
Minnesota Statutes 2016, section 356.415, subdivision 1b, is amended to read:
(a) deleted text begin Retirement annuity, disability
benefit, or survivor benefit recipients ofdeleted text end new text begin Annuities, disability benefits, and survivor benefits
being paid from new text end the general employees retirement plan of the Public Employees Retirement
Association deleted text begin and the local government correctional service retirement plan are entitled to a
postretirement adjustment annually ondeleted text end new text begin shall be increased effective each new text end January 1deleted text begin , as follows:deleted text end new text begin
by the percentage of increase determined under this subdivision. The increase to the annuity
or benefit shall be determined by multiplying the monthly amount of the annuity or benefit
by the percentage of increase specified in paragraph (b), after taking into account any
reduction to the percentage of increase required under paragraph (c).
new text end
deleted text begin
(1) for each successive January 1 until funding stability is restored for the applicable
retirement plan, a postretirement increase of one percent must be applied each year, effective
on January 1, to the monthly annuity or benefit amount of each annuitant or benefit recipient
who has been receiving an annuity or benefit for at least 12 full months as of the June 30
of the calendar year immediately before the adjustment;
deleted text end
deleted text begin
(2) for each successive January 1 until funding stability is restored for the applicable
retirement plan, for each annuitant or benefit recipient who has been receiving an annuity
or a benefit for at least one full month, but less than 12 full months as of the June 30 of the
calendar year immediately before the adjustment, an annual postretirement increase of 1/12
of one percent for each month the person has been receiving an annuity or benefit must be
applied;
deleted text end
deleted text begin
(3) for each January 1 following the restoration of funding stability for the applicable
retirement plan, a postretirement increase of 2.5 percent must be applied each year, effective
January 1, to the monthly annuity or benefit amount of each annuitant or benefit recipient
who has been receiving an annuity or benefit for at least 12 full months as of the June 30
of the calendar year immediately before the adjustment; and
deleted text end
deleted text begin
(4) for each January 1 following restoration of funding stability for the applicable
retirement plan, for each annuity or benefit recipient who has been receiving an annuity or
a benefit for at least one full month, but less than 12 full months as of the June 30 of the
calendar year immediately before the adjustment, an annual postretirement increase of 1/12
of 2.5 percent for each month the person has been receiving an annuity or benefit must be
applied.
deleted text end
deleted text begin
(b) Funding stability is restored when the market value of assets of the applicable
retirement plan equals or exceeds 90 percent of the actuarial accrued liabilities of the
applicable plan in the two most recent consecutive actuarial valuations prepared under
section 356.215 and the standards for actuarial work by the approved actuary retained by
the Public Employees Retirement Association under section 356.214.
deleted text end
deleted text begin
(c) After having met the definition of funding stability under paragraph (b), the increase
provided in paragraph (a), clauses (1) and (2), rather than an increase under subdivision 1,
is again to be applied in a subsequent year or years if the market value of assets of the
applicable plan equals or is less than:
deleted text end
deleted text begin
(1) 85 percent of the actuarial accrued liabilities of the applicable plan for two consecutive
actuarial valuations; or
deleted text end
deleted text begin
(2) 80 percent of the actuarial accrued liabilities of the applicable plan for the most recent
actuarial valuation.
deleted text end
new text begin
(b) The percentage of increase shall be one percent unless the federal Social Security
Administration has announced a cost-of-living adjustment pursuant to United States Code,
title 42, section 415(i), in the last quarter of the preceding calendar year that is greater than
two percent. If the cost-of-living adjustment announced by the federal Social Security
Administration is greater than two percent, the percentage of increase shall be 50 percent
of the cost-of-living adjustment announced by the federal Social Security Administration,
but in no event may the percentage of increase exceed 1.5 percent.
new text end
new text begin
(c)(1) If the recipient of an annuity, disability benefit, or survivor's benefit has been
receiving the annuity or benefit for at least 12 full months as of the June 30 of the calendar
year immediately before the effective date of the increase, there is no reduction in the
percentage of increase.
new text end
new text begin
(2) If the recipient of an annuity, disability benefit, or survivor's benefit has been receiving
the annuity or benefit for at least one month, but less than 12 full months, as of the June 30
of the calendar year immediately preceding the effective date of the increase, the percentage
of increase is multiplied by a fraction, the numerator of which is the number of months the
annuity or benefit was received as of June 30 of the preceding calendar year and the
denominator of which is 12.
new text end
new text begin
(d) Effective for members who retire on or after January 1, 2024, annuities shall not be
increased under paragraphs (a) to (c) until January 1 of the year following the year in which
the member reaches normal retirement age. January 1 of the year following the year in
which the member reaches normal retirement age shall be considered the effective date of
the increase under paragraph (c). If a member has been receiving an annuity for fewer than
seven months as of the January 1 of the year following the year in which the member reaches
normal retirement age, no increase shall be paid until January 1 of the next year.
new text end
deleted text begin (d)deleted text end new text begin (e) new text end An increase in annuity or benefit payments under this section must be made
automatically unless written notice is filed by the deleted text begin annuitant or benefitdeleted text end recipient with the
executive director of the Public Employees Retirement Association requesting that the
increase not be made.
new text begin
(f) Paragraph (d) does not apply to members who retire under section 353.30, subdivision
1a.
new text end
new text begin
This section is effective July 1, 2018.
new text end
Minnesota Statutes 2016, section 356.415, subdivision 1c, is amended to read:
(a) Retirement
annuity, disability benefit, or survivor benefit recipients of the public employees police and
fire retirement plan are entitled to deleted text begin adeleted text end new text begin an annual new text end postretirement adjustment deleted text begin annually ondeleted text end new text begin ,
effective as of eachnew text end January 1, deleted text begin if the definition of funding stability under paragraph (c) has
not been met,deleted text end as follows:
deleted text begin
(1) for each annuitant or benefit recipient whose annuity or benefit effective date is on
or before June 1, 2014, who has been receiving the annuity or benefit for at least 12 full
months as of the immediate preceding June 30, an amount equal to one percent in each year;
or
deleted text end
deleted text begin
(2) for each annuitant or benefit recipient whose annuity or benefit effective date is on
or before June 1, 2014, who has been receiving the annuity or benefit for at least one full
month, but less than 12 months, as of the immediate preceding June 30, an amount equal
to 1/12 of one percent for each month of annuity or benefit receipt; and
deleted text end
deleted text begin (3)deleted text end new text begin (1) new text end for each annuitant or benefit recipient deleted text begin whose annuity or benefit effective date is
after June 1, 2014,deleted text end who will have been receiving an annuity or benefit for at least 36 full
months as of the immediate preceding June 30, deleted text begin an amount equal todeleted text end new text begin a postretirement increase
of new text end one percentnew text begin must be applied each year to the amount of the monthly annuity or benefit
of the annuitant or benefit recipientnew text end ; or
deleted text begin (4)deleted text end new text begin (2) new text end for each annuitant or benefit recipient deleted text begin whose annuity or benefit effective date is
after June 1, 2014,deleted text end who has been receiving the annuity or benefit for at least 25 full months,
but less than 36 months as of the immediate preceding June 30, deleted text begin an amount equal todeleted text end new text begin a
postretirement increase of new text end 1/12 of one percent for each full month deleted text begin ofdeleted text end new text begin that the person has
been receiving an new text end annuity or benefit deleted text begin receiptdeleted text end during the fiscal year in which the annuity or
benefit was effectivenew text begin must be applied each year to the amount of the monthly annuity or
benefit of the annuitant or benefit recipientnew text end .
deleted text begin
(b) Retirement annuity, disability benefit, or survivor benefit recipients of the public
employees police and fire retirement plan are entitled to a postretirement adjustment annually
on each January 1 following the restoration of funding stability as defined under paragraph
(c) and during the continuation of funding stability as defined under paragraph (c), as follows:
deleted text end
deleted text begin
(1) for each annuitant or benefit recipient who has been receiving the annuity or benefit
for at least 36 full months as of the immediate preceding June 30, an amount equal to 2.5
percent; and
deleted text end
deleted text begin
(2) for each annuitant or benefit recipient who has been receiving the annuity or benefit
for at least 25 full months, but less than 36 full months, as of the immediate preceding June
30, an amount equal to 1/12 of 2.5 percent for each full month of annuity or benefit receipt
during the fiscal year in which the annuity or benefit was effective.
deleted text end
deleted text begin
(c) Funding stability is restored when the market value of assets of the public employees
police and fire retirement plan equals or exceeds 90 percent of the actuarial accrued liabilities
of the applicable plan in the two most recent consecutive actuarial valuations prepared under
section 356.215 and under the standards for actuarial work of the Legislative Commission
on Pensions and Retirement by the approved actuary retained by the Public Employees
Retirement Association under section 356.214.
deleted text end
deleted text begin
(d) After having met the definition of funding stability under paragraph (c), a full or
prorated increase, as provided in paragraph (a), clause (1), (2), (3), or (4), whichever applies,
rather than adjustments under paragraph (b), is again applied in a subsequent year or years
if the market value of assets of the public employees police and fire retirement plan equals
or is less than:
deleted text end
deleted text begin
(1) 85 percent of the actuarial accrued liabilities of the applicable plan for two consecutive
actuarial valuations; or
deleted text end
deleted text begin
(2) 80 percent of the actuarial accrued liabilities of the applicable plan for the most recent
actuarial valuation.
deleted text end
deleted text begin (e)deleted text end new text begin (b) new text end An increase in annuity or benefit payments under this section must be made
automatically unless written notice is filed by the annuitant or benefit recipient with the
executive director of the Public Employees Retirement Association requesting that the
increase not be made.
new text begin
This section is effective July 1, 2018.
new text end
Minnesota Statutes 2016, section 356.415, subdivision 1d, is amended to read:
(a)new text begin
Except as set forth in paragraph (d), recipients of anew text end retirement annuity, disability benefit,
or survivor benefit deleted text begin recipients ofdeleted text end new text begin from new text end the Teachers Retirement Association are entitled to
deleted text begin adeleted text end new text begin an annualnew text end postretirement adjustment deleted text begin annually ondeleted text end new text begin , effective as of eachnew text end January 1, as follows:
(1) deleted text begin for eachdeleted text end new text begin effective new text end January 1 deleted text begin until funding stability is restoreddeleted text end new text begin , 2019, through December
31, 2023new text end , a postretirement increase of deleted text begin twodeleted text end new text begin onenew text end percent must be applied each yeardeleted text begin , effective
on January 1,deleted text end to the new text begin amount of the new text end monthly annuity or benefit deleted text begin amountdeleted text end of each annuitant or
benefit recipient who has been receiving an annuity or a benefit for at least 12 full months
as of the June 30 of the calendar year immediately before the adjustment;
(2) deleted text begin for eachdeleted text end new text begin effective new text end January 1 deleted text begin until funding stability is restoreddeleted text end new text begin , 2019, through December
31, 2023new text end , for each annuitant or benefit recipient who has been receiving an annuity or a
benefit for at least one full month, but less than 12 full months as of the June 30 of the
calendar year immediately before the adjustment, deleted text begin an annualdeleted text end new text begin anew text end postretirement increase of
1/12 of deleted text begin twodeleted text end new text begin onenew text end percent for each month the person has been receiving an annuity or benefit
must be applieddeleted text begin ;deleted text end new text begin to the amount of the monthly annuity or benefit of the annuitant or benefit
recipient;
new text end
deleted text begin
(3) for each January 1 following the restoration of funding stability, a postretirement
deleted text end
deleted text begin
increase of 2.5 percent must be applied each year, effective January 1, to the monthly annuity
deleted text end
deleted text begin
or benefit amount of each annuitant or benefit recipient who has been receiving an annuity
deleted text end
deleted text begin
or a benefit for at least 12 full months as of the June 30 of the calendar year immediately
deleted text end
deleted text begin
before the adjustment; and
deleted text end
deleted text begin
(4) for each January 1 following the restoration of funding stability, for each annuitant
deleted text end
deleted text begin
or benefit recipient who has been receiving an annuity or a benefit for at least one month,
deleted text end
deleted text begin
but less than 12 full months as of the June 30 of the calendar year immediately before the
deleted text end
deleted text begin
adjustment, an annual postretirement increase of 1/12 of 2.5 percent for each month the
deleted text end
deleted text begin
person has been receiving an annuity or benefit must be applied.
deleted text end
deleted text begin
(b) Funding stability is restored when the market value of assets of the Teachers
deleted text end
deleted text begin
Retirement Association equals or exceeds 90 percent of the actuarial accrued liabilities of
deleted text end
deleted text begin
the Teachers Retirement Association in the two most recent prior actuarial valuations
deleted text end
deleted text begin
prepared under section
deleted text end
deleted text begin
and the standards for actuarial work by the approved actuary
deleted text end
deleted text begin
retained by the Teachers Retirement Association under section
deleted text end
deleted text begin
.
deleted text end
deleted text begin
(c) After having met the definition of funding stability under paragraph (b), the increase
deleted text end
deleted text begin
provided in paragraph (a), clauses (1) and (2), rather than an increase under
deleted text end
deleted text begin
subdivision 1,
deleted text end
deleted text begin
or the increase under
deleted text end
deleted text begin
paragraph (a), clauses (3) and (4), is again to be applied in a subsequent
deleted text end
deleted text begin
year or years if the market value of assets of the plan equals or is less than:
deleted text end
deleted text begin
(1) 85 percent of the actuarial accrued liabilities of the plan for two consecutive actuarial
deleted text end
deleted text begin
valuations; or
deleted text end
deleted text begin
(2) 80 percent of the actuarial accrued liabilities of the plan for the most recent actuarial
deleted text end
deleted text begin
valuation.
deleted text end
new text begin
(3) effective January 1, 2024, and thereafter, a postretirement increase must be applied
each year to the amount of the monthly annuity or benefit of each annuitant or benefit
recipient who has been receiving an annuity or a benefit for at least 12 full months as of the
June 30 of the calendar year immediately before the adjustment, at the following rates:
new text end
new text begin
from January 1, 2024, through December 31, 2024 new text end |
new text begin
1.1 percent new text end |
|
new text begin
from January 1, 2025, through December 31, 2025 new text end |
new text begin
1.2 percent new text end |
|
new text begin
from January 1, 2026, through December 31, 2026 new text end |
new text begin
1.3 percent new text end |
|
new text begin
from January 1, 2027, through December 31, 2027 new text end |
new text begin
1.4 percent new text end |
|
new text begin
from January 1, 2028, and thereafter new text end |
new text begin
1.5 percent new text end |
new text begin
(4) effective January 1, 2024, and thereafter, for each annuitant or benefit recipient who
has been receiving an annuity or a benefit for at least one full month, but less than 12 full
months, as of the June 30 of the calendar year immediately before the adjustment, an annual
postretirement increase of 1/12 of the applicable percentage for each month that the person
has been receiving an annuity or benefit must be applied to the amount of the monthly
annuity or benefit of the annuitant or benefit recipient. The applicable percentages are the
following:
new text end
new text begin
from January 1, 2024, through December 31, 2024 new text end |
new text begin
1.1 percent new text end |
|
new text begin
from January 1, 2025, through December 31, 2025 new text end |
new text begin
1.2 percent new text end |
|
new text begin
from January 1, 2026, through December 31, 2026 new text end |
new text begin
1.3 percent new text end |
|
new text begin
from January 1, 2027, through December 31, 2027 new text end |
new text begin
1.4 percent new text end |
|
new text begin
from January 1, 2028, and thereafter new text end |
new text begin
1.5 percent new text end |
deleted text begin (d)deleted text end new text begin (b)new text end An increase in annuity or benefit payments under this section must be made
automatically unless written notice is filed by the annuitant or benefit recipient with the
executive director of the Teachers Retirement Association requesting that the increase not
be made.
deleted text begin (e)deleted text end new text begin (c)new text end The retirement annuity payable to a person who retires before becoming eligible
for Social Security benefits and who has elected the optional payment as provided in section
354.35 must be treated as the sum of a period-certain retirement annuity and a life retirement
annuity for the purposes of any postretirement adjustment. The period-certain retirement
annuity plus the life retirement annuity must be the annuity amount payable until age 62,
65, or normal retirement age, as selected by the member at retirement, for an annuity amount
payable under section 354.35. A postretirement adjustment granted on the period-certain
retirement annuity must terminate when the period-certain retirement annuity terminates.
new text begin
(d) Members who retire on or after July 1, 2024, are entitled to an annual postretirement
adjustment of the member's retirement annuity, effective as of each January 1, beginning
with the year following the year in which the member attains normal retirement age, as
follows:
new text end
new text begin
(1) if a member has been receiving an annuity for at least 12 full months as of the June
30 of the calendar year immediately before the date of the adjustment, a postretirement
increase equal to the percentage specified in paragraph (a), clause (3), must be applied,
effective on January 1, to the amount of the member's monthly annuity;
new text end
new text begin
(2) if a member has been receiving an annuity for at least one full month, but less than
12 full months as of the June 30 of the calendar year immediately before the date of
adjustment, a postretirement increase of 1/12 of the applicable percentage specified in
paragraph (a), clause (4), for each month that the member has been receiving an annuity
must be applied, effective on January 1, to the amount of the member's monthly annuity;
or
new text end
new text begin
(3) if a member has been receiving an annuity for fewer than seven months as of the
January 1 of the year following the year in which the member attains normal retirement
age, a postretirement adjustment shall be applied effective as of the next January 1. The
amount of the adjustment shall be determined under clause (2).
new text end
new text begin
(e) Paragraph (d) does not apply to members who retire under section 354.44, subdivision
6, paragraph (c), clause (3), or who retire when the member is at least age 62 and has at
least 30 years of service under section 354.44, subdivision 6, paragraph (c), (d), (e), or (f),
as applicable.
new text end
new text begin
This section is effective July 1, 2018.
new text end
Minnesota Statutes 2016, section 356.415, subdivision 1e, is amended to read:
(a)
Retirement annuity, disability benefit, or survivor benefit recipients of the State Patrol
retirement plan are entitled to deleted text begin adeleted text end new text begin an annual new text end postretirement adjustment deleted text begin annually ondeleted text end new text begin , effective
as of eachnew text end January 1 deleted text begin if the definition of funding stability under paragraph (b) has not been
metdeleted text end , as follows:
(1) a postretirement increase of one percent must be applied each yeardeleted text begin , effective on
January 1,deleted text end to the monthly annuity or benefit of each annuitant or benefit recipient who has
been receiving an annuity or a benefit for at least 12 full months as of the June 30 of the
calendar year immediately before the adjustment; and
(2) for each annuitant or benefit recipient who has been receiving an annuity or a benefit
for at least one full month, but less than 12 full months as of the June 30 of the calendar
year immediately before the adjustment, an annual postretirement increase of 1/12 of one
percent for each month that the person has been receiving an annuity or benefit must be
appliednew text begin to the amount of the monthly annuity or benefit of each annuitant or benefit recipientnew text end .
deleted text begin
(b) Increases under paragraph (a) for the State Patrol retirement plan terminate on
December 31 of the calendar year in which two prior consecutive actuarial valuations for
the plan prepared by the approved actuary under sections 356.214 and 356.215 and the
standards for actuarial work promulgated by the Legislative Commission on Pensions and
Retirement indicates that the market value of assets of the retirement plan equals or exceeds
85 percent of the actuarial accrued liability of the retirement plan. Thereafter, increases
under paragraph (a) become effective again on the December 31 of the calendar year in
which the actuarial valuation, or prior consecutive actuarial valuations for the plan prepared
by the approved actuary under sections 356.214 and 356.215 and the standards for actuarial
work promulgated by the Legislative Commission on Pensions and Retirement indicates
that the market value of the assets of the retirement plan equals or is less than 80 percent
of the actuarial accrued liability of the retirement plan for two years, or equals or is less
than 75 percent of the actuarial accrued liability of the retirement plan for one year and
increases under paragraph (c) commence after that date.
deleted text end
deleted text begin
(c) Retirement annuity, disability benefit, or survivor benefit recipients of the State Patrol
retirement plan are entitled to a postretirement adjustment annually on January 1, as follows:
deleted text end
deleted text begin
(1) a postretirement increase of 1.5 percent must be applied each year, effective on
January 1, to the monthly annuity or benefit of each annuitant or benefit recipient who has
been receiving an annuity or a benefit for at least 12 full months as of the June 30 of the
calendar year immediately before the adjustment; and
deleted text end
deleted text begin
(2) for each annuitant or benefit recipient who has been receiving an annuity or a benefit
for at least one full month, but less than 12 full months as of the June 30 of the calendar
year immediately before the adjustment, an annual postretirement increase of 1/12 of 1.5
percent for each month that the person has been receiving an annuity or benefit must be
applied.
deleted text end
deleted text begin
(d) Increases under paragraph (c) for the State Patrol retirement plan terminate on
December 31 of the calendar year in which two prior consecutive actuarial valuations
prepared by the approved actuary under sections 356.214 and 356.215 and the standards
for actuarial work adopted by the Legislative Commission on Pensions and Retirement
indicates that the market value of assets of the retirement plan equals or exceeds 90 percent
of the actuarial accrued liability of the retirement plan and increases under subdivision 1
recommence after that date.
deleted text end
deleted text begin (e)deleted text end new text begin (b) new text end An increase in annuity or benefit payments under this subdivision must be made
automatically unless written notice is filed by the annuitant or benefit recipient with the
executive director of the applicable covered retirement plan requesting that the increase not
be made.
new text begin
This section is effective July 1, 2018.
new text end
Minnesota Statutes 2016, section 356.415, subdivision 1f, is amended to read:
deleted text begin
(a) The increases provided under this subdivision are in lieu of
increases under subdivision 1 or 1a for retirement annuity, disability benefit, or survivor
benefit recipients of the judges retirement plan.
deleted text end
deleted text begin (b)deleted text end new text begin (a) new text end Retirement annuity, disability benefit, or survivor benefit recipients of the judges
retirement plan are entitled to deleted text begin adeleted text end new text begin an annual new text end postretirement adjustment deleted text begin annually ondeleted text end new text begin , effective
as of eachnew text end January 1deleted text begin ,deleted text end new text begin if the definition of funding stability under paragraph (b) has not been
met, new text end as follows:
(1) a postretirement increase of 1.75 percent must be applied each yeardeleted text begin , effective on
January 1,deleted text end to the monthly annuity or benefit of each annuitant or benefit recipient who has
been receiving an annuity or a benefit for at least 12 full months as of the June 30 of the
calendar year immediately before the adjustment; and
(2) for each annuitant or benefit recipient who has been receiving an annuity or a benefit
for at least one full month, but less than 12 full months as of the June 30 of the calendar
year immediately before the adjustment, an annual postretirement increase of 1/12 of 1.75
percent for each month that the person has been receiving an annuity or benefit must be
appliednew text begin to the amount of the monthly annuity or benefit of each annuitant or benefit recipientnew text end .
deleted text begin (c)deleted text end new text begin (b) new text end Increases under deleted text begin this subdivisiondeleted text end new text begin paragraph (a) new text end terminate on December 31 of the
calendar year in which two prior consecutive actuarial valuations prepared by the approved
actuary under sections 356.214 and 356.215 and the standards for actuarial work promulgated
by the Legislative Commission on Pensions and Retirement indicates that the market value
of assets of the judges retirement plan equals or exceeds 70 percent of the actuarial accrued
liability of the retirement plandeleted text begin .deleted text end new text begin and new text end increases under deleted text begin subdivision 1 or 1a, whichever is
applicable,deleted text end new text begin paragraph (c) new text end begin deleted text begin on the January 1 next followingdeleted text end new text begin after new text end that date.
new text begin
(c) Retirement annuity, disability benefit, or survivor benefit recipients of the judges
retirement plan are entitled to a postretirement adjustment annually, effective as of each
January 1 if the definition of funding stability under paragraph (d) has not been met, as
follows:
new text end
new text begin
(1) a postretirement increase of two percent must be applied each year to the monthly
annuity or benefit of each annuitant or benefit recipient who has been receiving an annuity
or a benefit for at least 12 full months as of the June 30 of the calendar year immediately
before the adjustment; and
new text end
new text begin
(2) for each annuitant or benefit recipient who has been receiving an annuity or a benefit
for at least one full month, but less than 12 full months as of the June 30 of the calendar
year immediately before the adjustment, an annual postretirement increase of 1/12 of two
percent for each month that the person has been receiving an annuity or benefit must be
applied to the amount of the monthly annuity or benefit of the annuitant or benefit recipient.
new text end
new text begin
(d) Increases under paragraph (c) terminate on December 31 of the calendar year in
which two prior consecutive actuarial valuations prepared by the approved actuary under
section 356.214 and the standards for actuarial work promulgated by the Legislative
Commission on Pensions and Retirement indicate that the market value of assets of the
judges retirement plan equals or exceeds 90 percent of the actuarial accrued liability of the
retirement plan and increases under paragraph (e) begin after that date.
new text end
new text begin
(e) Retirement annuity, disability benefit, or survivor benefit recipients of the judges
retirement plan are entitled to a postretirement adjustment annually, effective as of each
January 1, as follows:
new text end
new text begin
(1) a postretirement increase of 2.5 percent must be applied each year to the monthly
annuity or benefit of each annuitant or benefit recipient who has been receiving an annuity
or a benefit for at least 12 full months as of the June 30 of the calendar year immediately
before the adjustment; and
new text end
new text begin
(2) for each annuitant or benefit recipient who has been receiving an annuity or a benefit
for at least one full month, but less than 12 full months as of the June 30 of the calendar
year immediately before the adjustment, an annual postretirement increase of 1/12 of 2.5
percent for each month that the person has been receiving an annuity or benefit must be
applied to the amount of the monthly annuity or benefit of the annuitant or benefit recipient.
new text end
deleted text begin (d)deleted text end new text begin (f) new text end An increase in annuity or benefit payments under this subdivision must be made
automatically unless written notice is filed by the annuitant or benefit recipient with the
executive director of the applicable covered retirement plan requesting that the increase not
be made.
new text begin
This section is effective July 1, 2018.
new text end
Minnesota Statutes 2016, section 356.415, is amended by adding a subdivision
to read:
new text begin
(a) Annuities, disability benefits, and survivor benefits being paid from
the local government correctional retirement plan of the Public Employees Retirement
Association shall be increased effective each January 1 by the percentage of increase
determined under this subdivision. The increase to the annuity or benefit shall be determined
by multiplying the monthly amount of the annuity or benefit by the percentage of increase
specified in paragraph (b), after taking into account any reduction to the percentage of
increase required under paragraph (c).
new text end
new text begin
(b) The percentage of increase shall be one percent unless the federal Social Security
Administration has announced a cost-of-living adjustment pursuant to United States Code,
title 42, section 415(i), in the last quarter of the preceding calendar year that is greater than
one percent. If the cost-of-living adjustment announced by the federal Social Security
Administration is greater than one percent, the percentage of increase shall be the same as
the cost-of-living adjustment announced by the federal Social Security Administration, but
in no event may the percentage of increase exceed the applicable maximum percentage.
The applicable maximum percentage is 2.5 percent, until either of the following occurs, in
which case the applicable maximum percentage is 1.5 percent and remains at 1.5 percent
thereafter:
new text end
new text begin
(1) the market value of assets equals or is less than 85 percent of the actuarial accrued
liabilities as reported by the plan's actuary in two consecutive annual actuarial valuations;
or
new text end
new text begin
(2) the market value of assets equals or is less than 80 percent of the actuarial accrued
liabilities as reported by the plan's actuary in the most recent annual actuarial valuation.
new text end
new text begin
(c)(1) If the recipient of an annuity, disability benefit, or survivor's benefit has been
receiving the annuity or benefit for at least 12 full months as of the June 30 of the calendar
year immediately before the effective date of the increase, there is no reduction in the
percentage of increase.
new text end
new text begin
(2) If the recipient of an annuity, disability benefit, or survivor's benefit has been receiving
the annuity or benefit for at least one month, but less than 12 full months, as of the June 30
of the calendar year immediately preceding the effective date of the increase, the percentage
of increase is multiplied by a fraction, the numerator of which is the number of months the
annuity or benefit was received as of June 30 of the preceding calendar year and the
denominator of which is 12.
new text end
new text begin
(d) An increase in annuity or benefit payments under this section must be made
automatically unless written notice is filed by the recipient with the executive director of
the Public Employees Retirement Association requesting that the increase not be made.
new text end
new text begin
This section is effective July 1, 2018.
new text end
new text begin
Before December 31, 2020, the Legislative Commission on Pensions and Retirement
must conduct a study of postretirement adjustments for the covered plans as defined in
Minnesota Statutes, section 356.415, subdivision 2, and the St. Paul Teachers Retirement
Fund Association. The study shall take into account the purpose of postretirement adjustments
and whether governing statutes are consistent with the purpose of postretirement adjustments.
The study shall also consider alternative methodologies for determining postretirement
adjustments and evaluate the new methodology to be used by the Public Employees
Retirement Association under this act. The Legislative Commission on Pensions and
Retirement shall report its conclusions based on the study during the 2021 legislative session.
new text end
new text begin
This section is effective the day following final enactment.
new text end
Minnesota Statutes 2016, section 3A.03, subdivision 2, is amended to read:
(a) A former member who has made contributions under subdivision
1 and who is no longer a member of the legislature is entitled to receive, upon written
application to the executive director on a form prescribed by the executive director, a refund
from the general fund of all contributions credited to the member's account with interest
computed as provided in section 352.22, subdivision 2.
(b) The refund of contributions as provided in paragraph (a) terminates all rights of a
former member of the legislature and the survivors of the former member under this chapter.
(c) If the former member of the legislature again becomes a member of the legislature
after having taken a refund as provided in paragraph (a), the member is a member of the
unclassified employees retirement program of the Minnesota State Retirement System.
(d) However, the member may reinstate the rights and credit for service previously
forfeited under this chapter if the member repays all refunds taken, plus interest at the deleted text begin rate
of 8.5 percent until June 30, 2015, and eight percent thereafterdeleted text end new text begin applicable annual rate or
rates specified in section 356.59, subdivision 2, new text end compounded annuallynew text begin ,new text end from the date on
which the refund was taken to the date on which the refund is repaid.
new text begin
(e) A member of the legislature who has received a refund from any of the retirement
plans specified in section 356.311, paragraph (b), may repay the refund to the respective
plan under such terms and conditions consistent with the law governing the retirement plan
if the law governing the plan permits the repayment of refunds. If the total amount to be
repaid, including principal and interest exceeds $2,000, repayment may be made in three
equal installments over a period of 18 months, with the interest accrued during the period
of the repayment added to the final installment.
new text end
deleted text begin (e)deleted text end new text begin (f) new text end No person may be required to apply for or to accept a refund.
new text begin
This section is effective July 1, 2018.
new text end
Minnesota Statutes 2016, section 352.01, subdivision 13a, is amended to read:
An employee
on leave of absence receiving temporary workers' compensation payments and a reduced
salary or no salary from the employer who is entitled to allowable service credit for the
period of absence, may make payment to the fund for the difference between salary received,
if any, and the salary the employee would normally receive if not on leave of absence during
the period. The employee shall pay an amount equal to the employee and employer
contribution rate under section 352.04, subdivisions 2 and 3, on the differential salary amount
for the period of the leave of absence.
The employing department, at its option, may pay the employer amount on behalf of its
employees. Payment made under this subdivision must include interest at the deleted text begin rate of 8.5
percent until June 30, 2015, and eight percent thereafter per yeardeleted text end new text begin applicable annual rate or
rates specified in section 356.59, subdivision 2new text end , and must be completed within one year of
the return from leave of absence.
new text begin
This section is effective July 1, 2018.
new text end
Minnesota Statutes 2016, section 352.017, subdivision 2, is amended to read:
(a) An employee covered by a plan specified in this
chapter may purchase credit for allowable service in that plan for a period specified in
subdivision 1 if the employee makes a payment as specified in paragraph (b) or (c), whichever
applies. The employing unit, at its option, may pay the employer portion of the amount
specified in paragraph (b) on behalf of its employees.
(b) If payment is received by the executive director within one year from the date the
employee returned to work following the authorized leave, the payment amount is equal to
the employee and employer contribution rates specified in law for the applicable plan at the
end of the leave period multiplied by the employee's hourly rate of salary on the date of
return from the leave of absence and by the days and months of the leave of absence for
which the employee is eligible for allowable service credit. The payment must include
compound interest at the deleted text begin monthly rate of 0.71 percent until June 30, 2015, and 0.667 percent
per month thereafterdeleted text end new text begin applicable monthly rate or rates specified in section 356.59, subdivision
2, new text end from the last day of the leave period until the last day of the month in which payment is
received. If payment is received by the executive director after one year, the payment amount
is the amount determined under section 356.551. Payment under this paragraph must be
made before the date of termination from public employment covered under this chapter.
(c) If the employee terminates employment covered by this chapter during the leave or
following the leave rather than returning to covered employment, payment must be received
by the executive director within 30 days after the termination date. The payment amount is
equal to the employee and employer contribution rates specified in law for the applicable
plan on the day prior to the termination date, multiplied by the employee's hourly rate of
salary on that date and by the days and months of the leave of absence prior to termination.
new text begin
This section is effective July 1, 2018.
new text end
Minnesota Statutes 2016, section 352.04, subdivision 8, is amended to read:
(a) If a department
fails to take deductions past due for a period of 60 days or less from an employee's salary
as provided in this section, those deductions must be taken on later payroll abstracts.
(b) If a department fails to take deductions past due for a period in excess of 60 days
from an employee's salary as provided in this section, the department, and not the employee,
must pay on later payroll abstracts the employee and employer contributions and deleted text begin an amount
equivalent to 8.5 percent until June 30, 2015, and eight percent thereafter of the total amount
due in lieu of interest, or if the delay in payment exceeds one year, 8.5 percent until June
30, 2015, and eight percent thereafter compound annualdeleted text end interestdeleted text begin .deleted text end new text begin at the applicable annual
rate or rates specified in section 356.59, subdivision 2, compounded annually, from the date
the employee and employer contributions should have been deducted to the date payment
of the total amount due is paid by the department.
new text end
(c) If a department fails to take deductions past due for a period of 60 days or less and
the employee is no longer in state service so that the required deductions cannot be taken
from the salary of the employee, the department must nevertheless pay the required employer
contributions. If any department fails to take deductions past due for a period in excess of
60 days and the employee is no longer in state service, the omitted contributions must be
recovered under paragraph (b).
(d) If an employee from whose salary required deductions were past due for a period of
60 days or less leaves state service before the payment of the omitted deductions and
subsequently returns to state service, the unpaid amount is considered the equivalent of a
refund. The employee accrues no right by reason of the unpaid amount, except that the
employee may pay the amount of omitted deductions as provided in section 352.23.
new text begin
This section is effective July 1, 2018.
new text end
Minnesota Statutes 2016, section 352.04, subdivision 9, is amended to read:
(a) Deductions taken from the
salary of an employee for the retirement fund in excess of required amounts must, upon
discovery and verification by the department making the deduction, be refunded to the
employee.
(b) If a deduction for the retirement fund is taken from a salary warrant or check, and
the check is canceled or the amount of the warrant or check returned to the funds of the
department making the payment, the sum deducted, or the part of it required to adjust the
deductions, must be refunded to the department or institution if the department applies for
the refund on a form furnished by the director. The department's payments must likewise
be refunded to the department.
(c) If erroneous employee deductions and employer contributions are caused by an error
in plan coverage involving the plan and any other plans specified in section 356.99, that
section applies. If the employee should have been covered by the plan governed by chapter
352D, 353D, 354B, or 354D, the employee deductions and employer contributions taken
in error must be directly transferred to the applicable employee's account in the correct
retirement plan, with interest at the deleted text begin rate of 0.71 percent per month until June 30, 2015, and
0.667 percent per month thereafterdeleted text end new text begin applicable monthly rate or rates specified in section
356.59, subdivision 2new text end , compounded annually, from the first day of the month following the
month in which coverage should have commenced in the correct defined contribution plan
until the end of the month in which the transfer occurs.
new text begin
This section is effective July 1, 2018.
new text end
Minnesota Statutes 2016, section 352.23, is amended to read:
(a) When any employee accepts a refund as provided in section 352.22, all existing
allowable service credits and all rights and benefits to which the employee was entitled
before accepting the refund terminate.
(b) Terminated service credits and rights must not again be restored until the former
employee acquires at least six months of allowable service credit after taking the last refund.
In that event, the employee may repay all refunds previously taken from the retirement fund.
(c) Repayment of refunds entitles the employee only to credit for service covered by (1)
salary deductions; (2) payments previously made in lieu of salary deductions as permitted
under law in effect when the payment in lieu of deductions was made; (3) payments made
to obtain credit for service as permitted by laws in effect when payment was made; and (4)
allowable service previously credited while receiving temporary workers' compensation as
provided in section 352.01, subdivision 11, paragraph (a), clause (3).
(d) Payments under this section for repayment of refunds are to be paid with interest at
the deleted text begin rate of 8.5 percent until June 30, 2015, and eight percent thereafterdeleted text end new text begin applicable annual
rate or rates specified in section 356.59, subdivision 2, new text end compounded annuallynew text begin ,new text end from the date
the refund was taken until the date the refund is repaid. They may be paid in a lump sum
or by payroll deduction in the manner provided in section 352.04. Payment may be made
in a lump sum up to six months after termination from service.
new text begin
This section is effective July 1, 2018.
new text end
Minnesota Statutes 2016, section 352.27, is amended to read:
(a) An employee who is absent from employment by reason of service in the uniformed
services, as defined in United States Code, title 38, section 4303(13), and who returns to
state service upon discharge from service in the uniformed service within the time frames
required in United States Code, title 38, section 4312(e), may obtain service credit for the
period of the uniformed service as further specified in this section, provided that the employee
did not separate from uniformed service with a dishonorable or bad conduct discharge or
under other than honorable conditions.
(b) The employee may obtain credit by paying into the fund an equivalent employee
contribution based upon the contribution rate or rates in effect at the time that the uniformed
service was performed multiplied by the full and fractional years being purchased and
applied to the annual salary rate. The annual salary rate is the average annual salary during
the purchase period that the employee would have received if the employee had continued
to be employed in covered employment rather than to provide uniformed service, or, if the
determination of that rate is not reasonably certain, the annual salary rate is the employee's
average salary rate during the 12-month period of covered employment rendered immediately
preceding the period of the uniformed service.
(c) The equivalent employer contribution and, if applicable, the equivalent additional
employer contribution provided in this chapter must be paid by the department employing
the employee from funds available to the department at the time and in the manner provided
in this chapter, using the employer and additional employer contribution rate or rates in
effect at the time that the uniformed service was performed, applied to the same annual
salary rate or rates used to compute the equivalent employee contribution.
(d) If the employee equivalent contributions provided in this section are not paid in full,
the employee's allowable service credit must be prorated by multiplying the full and fractional
number of years of uniformed service eligible for purchase by the ratio obtained by dividing
the total employee contribution received by the total employee contribution otherwise
required under this section.
(e) To receive service credit under this section, the contributions specified in this section
must be transmitted to the Minnesota State Retirement System during the period which
begins with the date on which the individual returns to state service and which has a duration
of three times the length of the uniformed service period, but not to exceed five years. If
the determined payment period is less than one year, the contributions required under this
section to receive service credit may be made within one year of the discharge date.
(f) The amount of service credit obtainable under this section may not exceed five years
unless a longer purchase period is required under United States Code, title 38, section 4312.
(g) The employing unit shall pay interest on all equivalent employee and employer
contribution amounts payable under this section. Interest must be deleted text begin computed at the rate of
8.5 percent until June 30, 2015, and eight percent thereafterdeleted text end new text begin at the applicable annual rate or
rates specified in section 356.59, subdivision 2, new text end compounded annuallynew text begin ,new text end from the end of each
fiscal year of the leave or the break in service to the end of the month in which the payment
is received.
new text begin
This section is effective July 1, 2018.
new text end
Minnesota Statutes 2016, section 352.955, subdivision 3, is amended to read:
(a) An eligible employee
who is transferred to plan coverage and who elects to transfer past service credit under this
section must pay an additional member contribution for that prior service period. The
additional member contribution is the amount computed under paragraph (b), plus the greater
of the amount computed under paragraph (c), or 40 percent of the unfunded actuarial accrued
liability attributable to the past service credit transfer.
(b) The executive director shall compute, for the most recent 12 months of service credit
eligible for transfer, or for the entire period eligible for transfer if less than 12 months, the
difference between the employee contribution rate or rates for the general state employees
retirement plan and the employee contribution rate or rates for the correctional state
employees retirement plan applied to the eligible employee's salary during that transfer
period, plus compound interest at the new text begin applicable new text end monthly rate deleted text begin of 0.71 percent until June 30,
2015, and 0.667 percent per month thereafterdeleted text end new text begin or rates specified in section 356.59, subdivision
2new text end .
(c) The executive director shall compute, for any service credit being transferred on
behalf of the eligible employee and not included under paragraph (b), the difference between
the employee contribution rate or rates for the general state employees retirement plan and
the employee contribution rate or rates for the correctional state employees retirement plan
applied to the eligible employee's salary during that transfer period, plus compound interest
at the deleted text begin monthly rate of 0.71 percent until June 30, 2015, and 0.667 percent per month thereafterdeleted text end new text begin
applicable monthly rate or rates specified in section 356.59, subdivision 2new text end .
(d) The executive director shall compute an amount using the process specified in
paragraph (b), but based on differences in employer contribution rates between the general
state employees retirement plan and the correctional state employees retirement plan rather
than employee contribution rates.
(e) The executive director shall compute an amount using the process specified in
paragraph (c), but based on differences in employer contribution rates between the general
state employees retirement plan and the correctional state employees retirement plan rather
than employee contribution rates.
(f) The additional equivalent member contribution under this subdivision must be paid
in a lump sum. Payment must accompany the election to transfer the prior service credit.
No transfer election or additional equivalent member contribution payment may be made
by a person or accepted by the executive director after the one year anniversary date of the
effective date of the retirement coverage transfer, or the date on which the eligible employee
terminates state employment, whichever is earlier.
(g) If an eligible employee elects to transfer past service credit under this section and
pays the additional equivalent member contribution amount under paragraph (a), the
applicable department shall pay an additional equivalent employer contribution amount.
The additional employer contribution is the amount computed under paragraph (d), plus the
greater of the amount computed under paragraph (e), or 60 percent of the unfunded actuarial
accrued liability attributable to the past service credit transfer.
(h) The unfunded actuarial accrued liability attributable to the past service credit transfer
is the present value of the benefit obtained by the transfer of the service credit to the
correctional state employees retirement plan reduced by the amount of the asset transfer
under subdivision 4, by the amount of the member contribution equivalent payment computed
under paragraph (b), and by the amount of the employer contribution equivalent payment
computed under paragraph (d).
(i) The additional equivalent employer contribution under this subdivision must be paid
in a lump sum and must be paid within 30 days of the date on which the executive director
of the Minnesota State Retirement System certifies to the applicable department that the
employee paid the additional equivalent member contribution.
new text begin
This section is effective July 1, 2018.
new text end
Minnesota Statutes 2016, section 352B.013, subdivision 2, is amended to read:
(a) An employee covered by the plan specified in this
chapter may purchase credit for allowable service in the plan for a period specified in
subdivision 1 if the employee makes a payment as specified in paragraph (b) or (c), whichever
applies. The employing unit, at its option, may pay the employer portion of the amount
specified in paragraph (b) on behalf of its employees.
(b) If payment is received by the executive director within one year from the date the
employee returned to work following the authorized leave, the payment amount is equal to
the employee and employer contribution rates specified in section 352B.02 at the end of
the leave period multiplied by the employee's hourly rate of salary on the date of return
from the leave of absence and by the days and months of the leave of absence for which
the employee is eligible for allowable service credit. The payment must include compound
interest at the deleted text begin monthly rate of 0.71 percent until June 30, 2015, and 0.667 percent per month
thereafterdeleted text end new text begin applicable monthly rate or rates specified in section 356.59, subdivision 2, new text end from
the last day of the leave period until the last day of the month in which payment is received.
If payment is received by the executive director after one year from the date the employee
returned to work following the authorized leave, the payment amount is the amount
determined under section 356.551. Payment under this paragraph must be made before the
date of termination from public employment covered under this chapter.
(c) If the employee terminates employment covered by this chapter during the leave or
following the leave rather than returning to covered employment, payment must be received
by the executive director within 30 days after the termination date. The payment amount is
equal to the employee and employer contribution rates specified in section 352B.02 on the
day prior to the termination date, multiplied by the employee's hourly rate of salary on that
date and by the days and months of the leave of absence prior to termination.
new text begin
This section is effective July 1, 2018.
new text end
Minnesota Statutes 2016, section 352B.085, is amended to read:
A member on leave of absence receiving temporary workers' compensation payments
and a reduced salary or no salary from the employer who is entitled to allowable service
credit for the period of absence under section 352B.011, subdivision 3, paragraph (b), may
make payment to the fund for the difference between salary received, if any, and the salary
that the member would normally receive if the member was not on leave of absence during
the period. The member shall pay an amount equal to the member and employer contribution
rate under section 352B.02, subdivisions 1b and 1c, on the differential salary amount for
the period of the leave of absence. The employing department, at its option, may pay the
employer amount on behalf of the member. Payment made under this subdivision must
include interest at the deleted text begin rate of 8.5 percent until June 30, 2015, and eight percent thereafter
per yeardeleted text end new text begin applicable annual rate or rates specified in section 356.59, subdivision 2new text end , and must
be completed within one year of the member's return from the leave of absence.
new text begin
This section is effective July 1, 2018.
new text end
Minnesota Statutes 2016, section 352B.086, is amended to read:
(a) A member who is absent from employment by reason of service in the uniformed
services, as defined in United States Code, title 38, section 4303(13), and who returns to
state employment in a position covered by the plan upon discharge from service in the
uniformed services within the time frame required in United States Code, title 38, section
4312(e), may obtain service credit for the period of the uniformed service, provided that
the member did not separate from uniformed service with a dishonorable or bad conduct
discharge or under other than honorable conditions.
(b) The member may obtain credit by paying into the fund an equivalent member
contribution based on the member contribution rate or rates in effect at the time that the
uniformed service was performed multiplied by the full and fractional years being purchased
and applied to the annual salary rate. The annual salary rate is the average annual salary
during the purchase period that the member would have received if the member had continued
to provide employment services to the state rather than to provide uniformed service, or if
the determination of that rate is not reasonably certain, the annual salary rate is the member's
average salary rate during the 12-month period of covered employment rendered immediately
preceding the purchase period.
(c) The equivalent employer contribution and, if applicable, the equivalent employer
additional contribution, must be paid by the employing unit, using the employer and employer
additional contribution rate or rates in effect at the time that the uniformed service was
performed, applied to the same annual salary rate or rates used to compute the equivalent
member contribution.
(d) If the member equivalent contributions provided for in this section are not paid in
full, the member's allowable service credit must be prorated by multiplying the full and
fractional number of years of uniformed service eligible for purchase by the ratio obtained
by dividing the total member contributions received by the total member contributions
otherwise required under this section.
(e) To receive allowable service credit under this section, the contributions specified in
this section must be transmitted to the fund during the period which begins with the date
on which the individual returns to state employment covered by the plan and which has a
duration of three times the length of the uniformed service period, but not to exceed five
years. If the determined payment period is calculated to be less than one year, the
contributions required under this section to receive service credit must be transmitted to the
fund within one year from the discharge date.
(f) The amount of allowable service credit obtainable under this section may not exceed
five years, unless a longer purchase period is required under United States Code, title 38,
section 4312.
(g) The employing unit shall pay interest on all equivalent member and employer
contribution amounts payable under this section. Interest must be computed at the deleted text begin rate of
8.5 percent until June 30, 2015, and eight percent thereafterdeleted text end new text begin applicable annual rate or rates
specified in section 356.59, subdivision 2, new text end compounded annuallynew text begin ,new text end from the end of each
fiscal year of the leave or break in service to the end of the month in which payment is
received.
new text begin
This section is effective July 1, 2018.
new text end
Minnesota Statutes 2016, section 352B.11, subdivision 4, is amended to read:
new text begin (a) new text end When a former member,
who has become separated from state service that entitled the member to membership and
has received a refund of retirement payments, reenters the state service in a position that
entitles the member to membership, that member shall receive credit for the period of prior
allowable state service if the member repays into the fund the amount of the refund, plus
interest deleted text begin on it at the rate of 8.5 percent until June 30, 2015, and eight percent thereafterdeleted text end new text begin at
the applicable annual rate or rates specified in section 356.59, subdivision 2, new text end compounded
annually, at any time before subsequent retirement. Repayment may be made in installments
or in a lump sum.
new text begin
(b) A person who has received a refund from the State Patrol retirement fund who is a
member of a public retirement system included in section 356.311 may repay the refund
with interest to the State Patrol retirement fund as provided in paragraph (a).
new text end
new text begin
This section is effective July 1, 2018.
new text end
Minnesota Statutes 2016, section 352D.05, subdivision 4, is amended to read:
(a) A participant in the unclassified program may repay
regular refunds taken under section 352.22, as provided in section 352.23.
(b) A participant in the unclassified program or an employee covered by the general
employees retirement plan who has withdrawn the value of the total shares may repay the
refund taken and thereupon restore the service credit, rights and benefits forfeited by paying
into the fund the amount refunded plus interest at the deleted text begin rate of 8.5 percent until June 30, 2015,
and eight percent thereafterdeleted text end new text begin applicable annual rate or rates specified in section 356.59,
subdivision 2, new text end compounded annuallynew text begin ,new text end from the date that the refund was taken until the date
that the refund is repaid. If the participant had withdrawn only the employee shares as
permitted under prior laws, repayment must be pro rata.
(c) Except as provided in section 356.441, the repayment of a refund under this section
must be made in a lump sum.
new text begin
This section is effective July 1, 2018.
new text end
Minnesota Statutes 2016, section 352D.11, subdivision 2, is amended to read:
An employee entitled to purchase service credit may
make the purchase by paying to the state retirement system an amount equal to the current
employee contribution rate in effect for the state retirement system applied to the current
or final salary rate multiplied by the months and days of prior temporary, intermittent, or
contract legislative service. Payment shall be made in one lump sum unless the executive
director of the state retirement system agrees to accept payment in installments over a period
of not more than three years from the date of the agreement. Installment payments shall be
charged interest at the deleted text begin rate of 8.5 percent until June 30, 2015, and eight percent thereafterdeleted text end
new text begin applicable annual rate or rates specified in section 356.59, subdivision 2, new text end compounded
annually.
new text begin
This section is effective July 1, 2018.
new text end
Minnesota Statutes 2016, section 352D.12, is amended to read:
(a) An employee who is a participant in the unclassified program and who has prior
service credit in a covered plan under chapter 352, 353, 354, 354A, or 422A may, within
the time limits specified in this section, elect to transfer to the unclassified program prior
service contributions to one or more of those plans.
(b) For participants with prior service credit in a plan governed by chapter 352, 353,
354, 354A, or 422A, "prior service contributions" means the accumulated employee and
equal employer contributions with interest at the deleted text begin rate of 8.5 percent until June 30, 2015,
and eight percent thereafterdeleted text end new text begin applicable annual rate or rates specified in section 356.59,
subdivision 2, new text end compounded annually, based on fiscal year balances.
(c) If a participant has taken a refund from a retirement plan listed in this section, the
participant may repay the refund to that plan, notwithstanding any restrictions on repayment
to that plan, deleted text begin plus 8.5 percent interest until June 30, 2015, and eight percent interest thereafterdeleted text end
new text begin with interest at the applicable annual rate or rates specified in section 356.59, subdivision
2, new text end compounded annuallynew text begin ,new text end and have the accumulated employee and equal employer
contributions transferred to the unclassified program with interest at the rate of 8.5 percent
until June 30, 2015, and eight percent thereafter compounded annually based on fiscal year
balances. If a person repays a refund and subsequently elects to have the money transferred
to the unclassified program, the repayment amount, including interest, is added to the fiscal
year balance in the year which the repayment was made.
(d) A participant electing to transfer prior service contributions credited to a retirement
plan governed by chapter 352, 353, 354, 354A, or 422A as provided under this section must
complete a written application for the transfer and repay any refund within one year of the
commencement of the employee's participation in the unclassified program.
new text begin
This section is effective July 1, 2018.
new text end
Minnesota Statutes 2016, section 353.01, subdivision 16, is amended to read:
(a) "Allowable service" means:
(1) service during years of actual membership in the course of which employee deductions
were withheld from salary and contributions were made at the applicable rates under section
353.27, 353.65, or 353E.03;
(2) periods of service covered by payments in lieu of salary deductions under sections
353.27, subdivisions 12 and 12a, and 353.35;
(3) service in years during which the public employee was not a member but for which
the member later elected, while a member, to obtain credit by making payments to the fund
as permitted by any law then in effect;
(4) a period of authorized leave of absence during which the employee receives pay as
specified in subdivision 10, paragraph (a), clause (4) or (5), from which deductions for
employee contributions are made, deposited, and credited to the fund;
(5) a period of authorized leave of absence without pay, or with pay that is not included
in the definition of salary under subdivision 10, paragraph (a), clause (4) or (5), for which
salary deductions are not authorized, and for which a member obtained service credit for
up to 12 months of the authorized leave period by payment under section 353.0161 or
353.0162, to the fund made in place of salary deductions;
(6) a periodic, repetitive leave that is offered to all employees of a governmental
subdivision. The leave program may not exceed 208 hours per annual normal work cycle
as certified to the association by the employer. A participating member obtains service credit
by making employee contributions in an amount or amounts based on the member's average
salary, excluding overtime pay, that would have been paid if the leave had not been taken.
The employer shall pay the employer and additional employer contributions on behalf of
the participating member. The employee and the employer are responsible to pay interest
on their respective shares at the deleted text begin rate of 8.5 percent until June 30, 2015, and eight percent
thereafterdeleted text end new text begin applicable rate or rates specified in section 356.59, subdivision 3new text end , compounded
annually, from the end of the normal cycle until full payment is made. An employer shall
also make the employer and additional employer contributions, plus deleted text begin 8.5 percentdeleted text end interest
deleted text begin until June 30, 2015, and eight percent interest thereafterdeleted text end new text begin at the applicable rate or rates
specified in section 356.59, subdivision 3new text end , compounded annually, on behalf of an employee
who makes employee contributions but terminates public service. The employee contributions
must be made within one year after the end of the annual normal working cycle or within
30 days after termination of public service, whichever is sooner. The executive director
shall prescribe the manner and forms to be used by a governmental subdivision in
administering a periodic, repetitive leave. Upon payment, the member must be granted
allowable service credit for the purchased period;
(7) an authorized temporary or seasonal layoff under subdivision 12, limited to three
months allowable service per authorized temporary or seasonal layoff in one calendar year.
An employee who has received the maximum service credit allowed for an authorized
temporary or seasonal layoff must return to public service and must obtain a minimum of
three months of allowable service subsequent to the layoff in order to receive allowable
service for a subsequent authorized temporary or seasonal layoff;
(8) a period during which a member is absent from employment by a governmental
subdivision by reason of service in the uniformed services, as defined in United States Code,
title 38, section 4303(13), if the member returns to public service with the same governmental
subdivision upon discharge from service in the uniformed service within the time frames
required under United States Code, title 38, section 4312(e), provided that the member did
not separate from uniformed service with a dishonorable or bad conduct discharge or under
other than honorable conditions. The service must be credited if the member pays into the
fund equivalent employee contributions based upon the contribution rate or rates in effect
at the time that the uniformed service was performed multiplied by the full and fractional
years being purchased and applied to the annual salary rate. The annual salary rate is the
average annual salary during the purchase period that the member would have received if
the member had continued to be employed in covered employment rather than to provide
uniformed service, or, if the determination of that rate is not reasonably certain, the annual
salary rate is the member's average salary rate during the 12-month period of covered
employment rendered immediately preceding the period of the uniformed service. Payment
of the member equivalent contributions must be made during a period that begins with the
date on which the individual returns to public employment and that is three times the length
of the military leave period, or within five years of the date of discharge from the military
service, whichever is less. If the determined payment period is less than one year, the
contributions required under this clause to receive service credit may be made within one
year of the discharge date. Payment may not be accepted following 30 days after termination
of public service under subdivision 11a. If the member equivalent contributions provided
for in this clause are not paid in full, the member's allowable service credit must be prorated
by multiplying the full and fractional number of years of uniformed service eligible for
purchase by the ratio obtained by dividing the total member contributions received by the
total member contributions otherwise required under this clause. The equivalent employer
contribution, and, if applicable, the equivalent additional employer contribution must be
paid by the governmental subdivision employing the member if the member makes the
equivalent employee contributions. The employer payments must be made from funds
available to the employing unit, using the employer and additional employer contribution
rate or rates in effect at the time that the uniformed service was performed, applied to the
same annual salary rate or rates used to compute the equivalent member contribution. The
governmental subdivision involved may appropriate money for those payments. The amount
of service credit obtainable under this section may not exceed five years unless a longer
purchase period is required under United States Code, title 38, section 4312. The employing
unit shall pay interest on all equivalent member and employer contribution amounts payable
under this clause. Interest must be computed at the deleted text begin rate of 8.5 percent until June 30, 2015,
and eight percent thereafterdeleted text end new text begin applicable rate or rates specified in section 356.59, subdivision
3new text end , compounded annually, from the end of each fiscal year of the leave or the break in service
to the end of the month in which the payment is received. Upon payment, the employee
must be granted allowable service credit for the purchased period; or
(9) a period specified under section 353.0162.
(b) No member may receive more than 12 months of allowable service credit in a year
either for vesting purposes or for benefit calculation purposes.
(c) For an active member who was an active member of the former Minneapolis
Firefighters Relief Association on December 29, 2011, "allowable service" is the period of
service credited by the Minneapolis Firefighters Relief Association as reflected in the
transferred records of the association up to December 30, 2011, and the period of service
credited under paragraph (a), clause (1), after December 30, 2011. For an active member
who was an active member of the former Minneapolis Police Relief Association on December
29, 2011, "allowable service" is the period of service credited by the Minneapolis Police
Relief Association as reflected in the transferred records of the association up to December
30, 2011, and the period of service credited under paragraph (a), clause (1), after December
30, 2011.
new text begin
This section is effective July 1, 2018.
new text end
Minnesota Statutes 2016, section 353.0162, is amended to read:
(a) A member may purchase additional salary credit for a period specified in this section.
(b) The applicable period is a period during which the member is receiving a reduced
salary from the employer while the member is:
(1) receiving temporary workers' compensation payments related to the member's service
to the public employer;
(2) on an authorized leave of absence; or
(3) on an authorized partial paid leave of absence as a result of a budgetary or salary
savings program offered or mandated by a governmental subdivision.
(c) The differential salary amount is the difference between the average monthly salary
received by the member during the period of reduced salary under this section and the
average monthly salary of the member, excluding overtime, on which contributions to the
applicable plan were made during the period of the last six months of covered employment
occurring immediately before the period of reduced salary, applied to the member's normal
employment period, measured in hours or otherwise, as applicable.
(d) To receive eligible salary credit, the member shall pay an amount equal to:
(1) the applicable employee contribution rate under section 353.27, subdivision 2; 353.65,
subdivision 2; or 353E.03, subdivision 1, as applicable, multiplied by the differential salary
amount;
(2) plus an employer equivalent payment equal to the applicable employer contribution
rate in section 353.27, subdivision 3; 353.65, subdivision 3; or 353E.03, subdivision 2, as
applicable, multiplied by the differential salary amount;
(3) plus, if applicable, an equivalent employer additional amount equal to the additional
employer contribution rate in section 353.27, subdivision 3a, multiplied by the differential
salary amount.
(e) The employer, by appropriate action of its governing body and documented in its
official records, may pay the employer equivalent contributions and, as applicable, the
equivalent employer additional contributions on behalf of the member.
(f) Payment under this section must include interest on the contribution amount or
amounts, whichever applies, at deleted text begin an 8.5 percent annual rate until June 30, 2015, and at an
eight percent annual rate thereafterdeleted text end new text begin the applicable rate or rates specified in section 356.59,
subdivision 3, compounded annuallynew text end , prorated for deleted text begin applicabledeleted text end new text begin the number of new text end monthsnew text begin , if less
than 12 months,new text end from the date on which the period of reduced salary specified under this
section terminates to the date on which the payment or payments are received by the
executive director. Payment under this section must be completed within the earlier of 30
days from termination of public service by the employee under section 353.01, subdivision
11a, or one year after the termination of the period specified in paragraph (b), as further
restricted under this section.
(g) The period for which additional allowable salary credit may be purchased is limited
to the period during which the person receives temporary workers' compensation payments
or for those business years in which the governmental subdivision offers or mandates a
budget or salary savings program, as certified to the executive director by a resolution of
the governing body of the governmental subdivision. For an authorized leave of absence,
the period for which allowable salary credit may be purchased may not exceed 12 months
of authorized leave.
(h) To purchase salary credit for a subsequent period of temporary workers' compensation
benefits or subsequent authorized medical leave of absence, the member must return to
public service and render a minimum of three months of allowable service.
new text begin
This section is effective July 1, 2018.
new text end
Minnesota Statutes 2017 Supplement, section 353.27, subdivision 3c, is amended
to read:
(a) For
the period July 1, 2015, through December 31, 2031, the member contributions for former
members of the Minneapolis Employees Retirement Fund and by the former Minneapolis
Employees Retirement Fund-covered employing units are governed by this subdivision.
(b) The member contribution for a public employee who was a member of the former
Minneapolis Employees Retirement Fund on June 29, 2010, is 9.75 percent of the salary of
the employee.
(c) The employer regular contribution with respect to a public employee who was a
member of the former Minneapolis Employees Retirement Fund on June 29, 2010, is 9.75
percent of the salary of the employee.
(d) The annual employer supplemental contribution is the employing unit's share of
$31,000,000. For calendar years 2017 and 2018, the employer supplemental contribution
is the employing unit's share of $21,000,000.
(e) Each employing unit's share under paragraph (d) is the amount determined from an
allocation between each employing unit in the portion equal to the unit's employer
supplemental contribution paid or payable under Minnesota Statutes 2012, section 353.50,
during calendar year 2014.
(f) The employer supplemental contribution amount under paragraph (d) for calendar
year 2015 must be invoiced by the executive director of the Public Employees Retirement
Association by July 1, 2015. The calendar year 2015 payment is payable in a single amount
on or before September 30, 2015. For subsequent calendar years, the employer supplemental
contribution under paragraph (d) must be invoiced on January 31 of each year and is payable
in two parts, with the first half payable on or before July 31 and with the second half payable
on or before December 15. Late payments are payable with deleted text begin compounddeleted text end interestnew text begin , compounded
annually,new text end at the deleted text begin rate of 0.71 percentdeleted text end new text begin applicable rate or rates specified in section 356.59,
subdivision 3, new text end per month for each month or portion of a month that has elapsed after the
due date.
(g) The employer supplemental contribution under paragraph (d) terminates on December
31, 2031.
new text begin
This section is effective July 1, 2018.
new text end
Minnesota Statutes 2016, section 353.27, subdivision 7a, is amended to read:
(a) If employee deductions
and employer contributions under this section, section 353.50, 353.65, or 353E.03 were
erroneously transmitted to the association, but should have been transmitted to a plan covered
by chapter 352D, 353D, 354B, or 354D, the executive director shall transfer the erroneous
employee deductions and employer contributions to the appropriate retirement fund or
individual account, as applicable. The time limitations specified in subdivisions 7 and 12
do not apply. The transfer to the applicable defined contribution plan account must include
interest at the deleted text begin rate of 0.71 percent per month until June 30, 2015, and 0.667 percentdeleted text end new text begin applicable
rate or rates specified in section 356.59, subdivision 3, new text end per month deleted text begin thereafterdeleted text end , compounded
annually, from the first day of the month following the month in which coverage should
have commenced in the defined contribution plan until the end of the month in which the
transfer occurs.
(b) A potential transfer under paragraph (a) that is reasonably determined to cause the
plan to fail to be a qualified plan under section 401(a) of the federal Internal Revenue Code,
as amended, must not be made by the executive director of the association. Within 30 days
after being notified by the Public Employees Retirement Association of an unmade potential
transfer under this paragraph, the employer of the affected person must transmit an amount
representing the applicable salary deductions and employer contributions, without interest,
to the retirement fund of the appropriate Minnesota public pension plan, or to the applicable
individual account if the proper coverage is by a defined contribution plan. The association
must provide the employing unit a credit for the amount of the erroneous salary deductions
and employer contributions against future contributions from the employer. If the employing
unit receives a credit under this paragraph, the employing unit is responsible for refunding
to the applicable employee any amount that had been erroneously deducted from the person's
salary.
(c) If erroneous employee deductions and employer contributions reflect a plan coverage
error involving any Public Employees Retirement Association plan specified in section
356.99 and any other plan specified in that section, section 356.99 applies.
new text begin
This section is effective July 1, 2018.
new text end
Minnesota Statutes 2016, section 353.27, subdivision 12, is amended to read:
(a) In the case of omission of
required deductions for the general employees retirement plan, the public employees police
and fire retirement plan, or the local government correctional employees retirement plan
from the salary of an employee, the department head or designee shall immediately, upon
discovery, report the employee for membership and deduct the employee deductions under
subdivision 4 during the current pay period or during the pay period immediately following
the discovery of the omission. Payment for the omitted obligations may only be made in
accordance with reporting procedures and methods established by the executive director.
(b) When the entire omission period of an employee does not exceed 60 days, the
governmental subdivision may report and submit payment of the omitted employee
deductions and the omitted employer contributions through the reporting processes under
subdivision 4.
(c) When the omission period of an employee exceeds 60 days, the governmental
subdivision shall furnish to the association sufficient data and documentation upon which
the obligation for omitted employee and employer contributions can be calculated. The
omitted employee deductions must be deducted from the employee's subsequent salary
payment or payments and remitted to the association for deposit in the applicable retirement
fund. The employee shall pay omitted employee deductions due for the 60 days prior to the
end of the last pay period in the omission period during which salary was earned. The
employer shall pay any remaining omitted employee deductions and any omitted employer
contributions, plus cumulative interest at the annual rate of 8.5 percent until June 30, 2015,
and eight percent thereafter compounded annually, from the date or dates each omitted
employee contribution was first payable.
(d) An employer shall not hold an employee liable for omitted employee deductions
beyond the pay period dates under paragraph (c), nor attempt to recover from the employee
those employee deductions paid by the employer on behalf of the employee. Omitted
deductions due under paragraph (c) which are not paid by the employee constitute a liability
of the employer that failed to deduct the omitted deductions from the employee's salary.
The employer shall make payment with interest at the deleted text begin annual rate of 8.5 percent until June
30, 2015, and eight percent thereafterdeleted text end new text begin applicable rate or rates specified in section 356.59,
subdivision 3, new text end compounded annually. Omitted employee deductions are no longer due if an
employee terminates public service before making payment of omitted employee deductions
to the association, but the employer remains liable to pay omitted employer contributions
plus interest at the deleted text begin annual rate of 8.5 percent until June 30, 2015, and eight percent thereafterdeleted text end
new text begin applicable rate or rates specified in section 356.59, subdivision 3, new text end compounded annuallynew text begin ,new text end
from the date the contributions were first payable.
(e) The association may not commence action for the recovery of omitted employee
deductions and employer contributions after the expiration of three calendar years after the
calendar year in which the contributions and deductions were omitted. Except as provided
under paragraph (b), no payment may be made or accepted unless the association has already
commenced action for recovery of omitted deductions. An action for recovery commences
on the date of the mailing of any written correspondence from the association requesting
information from the governmental subdivision upon which to determine whether or not
omitted deductions occurred.
new text begin
This section is effective July 1, 2018.
new text end
Minnesota Statutes 2016, section 353.27, subdivision 12a, is amended to read:
A terminated employee who
was a member of the general employees retirement plan of the Public Employees Retirement
Association, the public employees police and fire retirement plan, or the local government
correctional employees retirement plan and who has a period of employment in which
previously omitted employer contributions were made under subdivision 12 but for whom
no, or only partial, omitted employee contributions have been made, or a member who had
prior coverage in the association for which previously omitted employer contributions were
made under subdivision 12 but who terminated service before required omitted employee
deductions could be withheld from salary, may pay the omitted employee deductions for
the period on which omitted employer contributions were previously paid plus interest at
the deleted text begin annual rate of 8.5 percent until June 30, 2015, and eight percent thereafterdeleted text end new text begin applicable
rate or rates specified in section 356.59, subdivision 3, new text end compounded annually. A terminated
employee may pay the omitted employee deductions plus interest within six months of an
initial notification from the association of eligibility to pay those omitted deductions. If a
terminated employee is reemployed in a position covered under a public pension fund under
section 356.30, subdivision 3, and elects to pay omitted employee deductions, payment
must be made no later than six months after a subsequent termination of public service.
new text begin
This section is effective July 1, 2018.
new text end
Minnesota Statutes 2016, section 353.27, subdivision 12b, is amended to read:
If deductions were omitted
from salary adjustments or final salary of a terminated employee who was a member of the
general employees retirement plan, the public employees police and fire retirement plan,
or the local government correctional employees retirement plan and who is immediately
eligible to draw a monthly benefit, the employer shall pay the omitted employer and employer
additional contributions plus interest on both the employer and employee amounts due at
deleted text begin an annual rate of 8.5 percentdeleted text end new text begin the applicable rate or rates specified in section 356.59,
subdivision 3, new text end compounded annually. The employee shall pay the employee deductions
within six months of an initial notification from the association of eligibility to pay omitted
deductions or the employee forfeits the right to make the payment.
new text begin
This section is effective July 1, 2018.
new text end
Minnesota Statutes 2016, section 353.28, subdivision 5, is amended to read:
Any amount due under this section or
section 353.27, subdivision 4, is payable with interest at the deleted text begin annual compound rate of 8.5
percent until June 30, 2015, and eight percent thereafterdeleted text end new text begin applicable rate or rates specified
in section 356.59, subdivision 3, compounded annually, new text end from the date due until the date
payment is received by the association, with a minimum interest charge of $10.
new text begin
This section is effective July 1, 2018.
new text end
Minnesota Statutes 2016, section 353.35, subdivision 1, is amended to read:
(a) Except as provided in paragraph (b), when any former
member accepts a refund, all existing service credits and all rights and benefits to which
the person was entitled prior to the acceptance of the refund must terminate.
(b) A refund under section 353.651, subdivision 3, paragraph (c), does not result in a
forfeiture of salary credit for the allowable service credit covered by the refund.
(c) The rights and benefits of a former member must not be restored until the person
returns to active service and acquires at least six months of allowable service credit after
taking the last refund and repays the refund or refunds taken and interest received under
section 353.34, subdivisions 1 and 2, plus interest at the deleted text begin annual rate of 8.5 percent until June
30, 2015, and eight percent thereafterdeleted text end new text begin applicable rate or rates specified in section 356.59,
subdivision 3, new text end compounded annually. If the person elects to restore service credit in a
particular fund from which the person has taken more than one refund, the person must
repay all refunds to that fund. All refunds must be repaid within six months of the last date
of termination of public service.
new text begin
This section is effective July 1, 2018.
new text end
Minnesota Statutes 2016, section 354.50, subdivision 2, is amended to read:
If a member desires to repay the refunds, payment shall include
interest at deleted text begin an annual rate of 8.5 percentdeleted text end new text begin the applicable annual rate or rates specified in section
356.59, subdivision 4, new text end compounded annuallynew text begin ,new text end from date of withdrawal to the date payment
is made and shall be credited to the fund.
new text begin
This section is effective July 1, 2018.
new text end
Minnesota Statutes 2016, section 354.51, subdivision 5, is amended to read:
(a) Except as provided in paragraph (b), in the event
that full required member contributions are not deducted from the salary of a teacher,
payment of shortages in member deductions on salary earned are the sole obligation of the
employing unit and are payable by the employing unit upon notification by the executive
director of the shortagenew text begin . The amount of the shortage shall be paidnew text end with interest at deleted text begin an annual
rate of 8.5 percentdeleted text end new text begin the applicable annual rate or rates specified in section 356.59, subdivision
4, new text end compounded annuallynew text begin ,new text end from the end of the fiscal year in which the shortage occurred to
the end of the month in which payment is made and the interest must be credited to the
fund. The employing unit shall also pay the employer contributions as specified in section
354.42, subdivisions 3 and 5 for the shortages. If the shortage payment is not paid by the
employing unit within 60 days of notification, and if the executive director does not use the
recovery procedure in section 354.512, the executive director shall certify the amount of
the shortage to the applicable county auditor, who shall spread a levy in the amount of the
shortage payment over the taxable property of the taxing district of the employing unit if
the employing unit is supported by property taxes. Payment may not be made for shortages
in member deductions on salary paid or payable under paragraph (b) or for shortages in
member deductions for persons employed by the Minnesota State Colleges and Universities
system in a faculty position or in an eligible unclassified administrative position and whose
employment was less than 25 percent of a full academic year, exclusive of the summer
session, for the applicable institution that exceeds the most recent 36 months.
(b) For a person who is employed by the Minnesota State Colleges and Universities
system in a faculty position or in an eligible unclassified administrative position and whose
employment was less than 25 percent of a full academic year, exclusive of the summer
session, for the applicable institution, upon the person's election under section 354B.21 of
retirement coverage under this chapter, the shortage in member deductions on the salary
for employment by the Minnesota State Colleges and Universities system institution of less
than 25 percent of a full academic year, exclusive of the summer session, for the applicable
institution for the most recent 36 months and the associated employer contributions must
be paid by the Minnesota State Colleges and Universities system institution, plus deleted text begin annual
compounddeleted text end interest at the deleted text begin rate of 8.5 percentdeleted text end new text begin applicable annual rate or rates specified in
section 356.59, subdivision 4, compounded annually, new text end from the end of the fiscal year in
which the shortage occurred to the end of the month in which the Teachers Retirement
Association coverage election is made. An individual electing coverage under this paragraph
shall repay the amount of the shortage in member deductions, plus interest, through deduction
from salary or compensation payments within the first year of employment after the election
under section 354B.21, subject to the limitations in section 16D.16. The Minnesota State
Colleges and Universities system may use any means available to recover amounts which
were not recovered through deductions from salary or compensation payments. No payment
of the shortage in member deductions under this paragraph may be made for a period longer
than the most recent 36 months.
new text begin
This section is effective July 1, 2018.
new text end
Minnesota Statutes 2016, section 354.52, subdivision 4, is amended to read:
An employer shall remit all amounts
due to the association and furnish a statement indicating the amount due and transmitted
with any other information required by the executive director. If an amount due is not
received by the association within 14 calendar days of the payroll warrant, the deleted text begin amount
accrues interest at an annual rate of 8.5 percentdeleted text end new text begin employer shall pay interest on the amount
due at the applicable annual rate or rates specified in section 356.59, subdivision 4,
new text end compounded annuallynew text begin ,new text end from the due date until the amount is received by the association.
All amounts due and other employer obligations not remitted within 60 days of notification
by the association must be certified to the commissioner of management and budget who
shall deduct the amount from any state aid or appropriation amount applicable to the
employing unit.
new text begin
This section is effective July 1, 2018.
new text end
Minnesota Statutes 2016, section 354.53, subdivision 5, is amended to read:
The employer shall pay interest on all equivalent
employee and employer contribution amounts payable under this sectiondeleted text begin . Interest must be
computed at a rate of 8.5 percentdeleted text end new text begin at the applicable annual rate or rates specified in section
356.59, subdivision 4, new text end compounded annuallynew text begin ,new text end from the end of each fiscal year of the leave
or the break in service to the end of the month in which the payment is received.
new text begin
This section is effective July 1, 2018.
new text end
Minnesota Statutes 2016, section 354.72, subdivision 2, is amended to read:
(a) A teacher may purchase credit for allowable and
formula service in the plan for a period specified in subdivision 1 if the teacher makes a
payment as specified in paragraph (b), (c), or (d), whichever applies. The employing unit,
at its option, may pay the employer portion of the amount on behalf of its employees.
(b) If payment is received by the executive director by June 30 of the fiscal year of the
strike period or by December 31 of the fiscal year following an authorized leave included
under section 354.093, 354.095, or 354.096, payment must equal the total employee and
employer contribution rates, including amortization contribution rates if applicable, multiplied
by the member's average monthly salary rate on the date the leave or strike period
commenced, multiplied by the months and portions of a month of the leave or strike period
for which the teacher seeks allowable service credit. This paragraph also applies to an
extended leave under section 354.094, except that payment must be received by June 30 of
the year of the leave, and the salary used in the computation is the salary received during
the year immediately preceding the initial year of the leave.
(c) If payment is made after June 30 and before the following June 30 for a strike period,
or after December 31 of the fiscal year following a leave of absence under section 354.093,
354.095, or 354.096, and before July 1, the payment must include the amount determined
in paragraph (b) plus compound interest at a monthly rate of 0.71 percent from June 30 for
a strike period, or from December 31 for a leave under section 354.093, 354.095, or 354.096,
until the last day of the month in which payment is received. If payment is made on or after
July 1 and before the following July 1 for an extended leave of absence under section
354.094, the payment must include the amount determined in paragraph (b) plus compound
interest at deleted text begin a monthly rate of 0.71 percentdeleted text end new text begin the applicable annual rate or rates specified in
section 356.59, subdivision 4,new text end from June 30 until the last day of the month in which payment
is received.
(d) If payment is received by the executive director after the applicable last permitted
date under paragraph (c), the payment amount is the amount determined under section
356.551. Notwithstanding payment deadlines specified in section 356.551, payment under
this section may be made anytime before the effective date of retirement.
new text begin
This section is effective July 1, 2018.
new text end
Minnesota Statutes 2016, section 354A.093, subdivision 6, is amended to read:
The employer shall pay interest on all equivalent
employee and employer contribution amounts payable under this section. Interest must be
computed at the deleted text begin rate of 8.5 percent until June 30, 2015, and eight percent thereafterdeleted text end new text begin applicable
annual rate or rates specified in section 356.59, subdivision 5, new text end compounded annuallynew text begin ,new text end from
the end of each fiscal year of the leave or break in service to the end of the month in which
payment is received.
new text begin
This section is effective July 1, 2018.
new text end
Minnesota Statutes 2016, section 354A.096, is amended to read:
Any teacher in the coordinated program of the St. Paul Teachers Retirement Fund
Association who is on an authorized medical leave of absence and subsequently returns to
teaching service is entitled to receive allowable service credit, not to exceed one year, for
the period of leave, upon making the prescribed payment to the fund. This payment must
include the required employee and employer contributions at the rates specified in section
354A.12, subdivisions 1 and 2a, as applied to the member's average full-time monthly salary
rate on the date the leave of absence commenced plus deleted text begin annualdeleted text end interest at the deleted text begin rate of 8.5
percent until June 30, 2015, and eight percent thereafter per yeardeleted text end new text begin applicable annual rate or
rates specified in section 356.59, subdivision 5, compounded annually, new text end from the end of the
fiscal year during which the leave terminates to the end of the month during which payment
is made. The member must pay the total amount required unless the employing unit, at its
option, pays the employer contributions. The total amount required must be paid by the end
of the fiscal year following the fiscal year in which the leave of absence terminated or before
the member retires, whichever is earlier. Payment must be accompanied by a copy of the
resolution or action of the employing authority granting the leave and the employing
authority, upon granting the leave, must certify the leave to the association in a manner
specified by the executive director. A member may not receive more than one year of
allowable service credit during any fiscal year by making payment under this section. A
member may not receive disability benefits under section 354A.36 and receive allowable
service credit under this section for the same period of time.
new text begin
This section is effective July 1, 2018.
new text end
Minnesota Statutes 2016, section 354A.12, subdivision 1a, is amended to read:
If the full required contributions
are not deducted from the salary of a teacher, payment of the shortage in such deductions
is the sole obligation of the employing unit during the three-year period following the end
of the fiscal year in which the shortage occurred. The shortage is payable by the employing
unit upon notification of the shortage by the executive director of the applicable retirement
fund association. The employing unit shall also pay any employer contributions related to
the shortage. The amount of the shortage in employee contributions and associated employer
contributions is payable with interest at the deleted text begin preretirement interest assumption for the
retirement fund as specified in section 356.215, subdivision 8, stated as a monthly ratedeleted text end
new text begin applicable annual rate or rates specified in section 356.59, subdivision 5, new text end from the date due
until the date payment is received in the office of the association, new text begin compounded annually,
new text end with a minimum interest charge of $10. If the shortage payment and interest is not paid by
the employing unit within 60 days of notification, the executive director shall certify the
amount of the shortage payment and interest to the commissioner of management and budget,
who shall deduct the amount from any state aid or appropriation amount applicable to the
employing unit.
new text begin
This section is effective July 1, 2018.
new text end
Minnesota Statutes 2016, section 354A.12, subdivision 7, is amended to read:
(a) If the executive director discovers,
within the time period specified in subdivision 8 following the payment of a refund or the
accrual date of any retirement annuity, survivor benefit, or disability benefit, that benefit
overpayment has occurred due to using invalid service or salary, or due to any erroneous
calculation procedure, the executive director must recalculate the annuity or benefit payable
and recover any overpayment. The executive director shall recover the overpayment by
requiring direct repayment or by suspending or reducing the payment of a retirement annuity
or other benefit payable under this chapter to the applicable person or the person's estate,
whichever applies, until all outstanding amounts have been recovered. If a benefit
overpayment or improper payment of benefits occurred caused by a failure of the person
to satisfy length of separation requirements for retirement under section 354A.011,
subdivision 21, the executive director shall recover the improper payments by requiring
direct repayment. The repayment must include interest at the deleted text begin rate of 0.71 percent per monthdeleted text end
new text begin applicable annual rate or rates specified in section 356.59, subdivision 5, new text end from the first of
the month in which a monthly benefit amount was paid to the first of the month in which
the amount is repaid, with annual compounding.
(b) In the event the executive director determines that an overpaid annuity or benefit
that is the result of invalid salary included in the average salary used to calculate the payment
amount must be recovered, the executive director must determine the amount of the employee
deductions taken in error on the invalid salary, with interest as determined under 354A.37,
subdivision 3, and must subtract that amount from the total annuity or benefit overpayment,
and the remaining balance of the overpaid annuity or benefit, if any, must be recovered.
(c) If the invalid employee deductions plus interest exceed the amount of the overpaid
benefits, the balance must be refunded to the person to whom the benefit or annuity is being
paid.
(d) Any invalid employer contributions reported on the invalid salary must be credited
against future contributions payable by the employer.
(e) If a member or former member, who is receiving a retirement annuity or disability
benefit for which an overpayment is being recovered, dies before recovery of the overpayment
is completed and an optional annuity or refund is payable, the remaining balance of the
overpaid annuity or benefit must continue to be recovered from the payment to the optional
annuity beneficiary or refund recipient.
(f) The board of trustees shall adopt policies directing the period of time and manner
for the collection of any overpaid retirement or optional annuity, and survivor or disability
benefit, or a refund that the executive director determines must be recovered as provided
under this section.
new text begin
This section is effective July 1, 2018.
new text end
Minnesota Statutes 2016, section 354A.34, is amended to read:
If a retiree from a coordinated program who has elected a period certain and for life
thereafter or a guaranteed refund optional annuity form dies without having a designated
beneficiary who has survived the retiree, any remaining unpaid guaranteed annuity payments
shall be computed at the rate of interest specified in section 356.215, subdivision 8, and
paid in one lump sum to the estate of the retiree. If a retiree from a coordinated program
who has elected a period certain and for life or a guaranteed refund optional annuity form
dies with a designated beneficiary who has survived the retiree but the designated beneficiary
dies without there existing another designated beneficiary, any remaining unpaid guaranteed
annuity payments shall be computed deleted text begin at the rate ofdeleted text end new text begin with new text end interest new text begin at the applicable annual rate
or rates new text end specified in section deleted text begin 356.215, subdivision 8deleted text end new text begin 356.59, subdivision 5new text end , and paid in one
lump sum to the estate of the designated beneficiary.
new text begin
This section is effective July 1, 2018.
new text end
Minnesota Statutes 2016, section 356.195, subdivision 2, is amended to read:
(a) An employee covered by a plan
specified in subdivision 1 may purchase allowable service credit in the applicable plan for
any period of time during which the employee was on a public employee strike without
pay, not to exceed a period of one year, if the employee makes a payment in lieu of salary
deductions as specified in paragraph (b) or (c), whichever applies. The employing unit, at
its option, may pay the employer portion of the amount specified in paragraph (b) on behalf
of its employees.
(b) If payment is received by the applicable pension plan executive director within one
year from the end of the strike, the payment amount is equal to the applicable employee
and employer contribution rates specified in law for the applicable plan during the strike
period, applied to the employee's rate of salary in effect at the conclusion of the strike for
the period of the strike without pay, plus compound interest at the deleted text begin monthly rate of 0.71
percent for any period for the Teachers Retirement Association and at the monthly rate of
0.71 percent until June 30, 2015, and 0.667 percent thereafter for any other retirement plan
listed in section 356.30, subdivision 3deleted text end new text begin applicable monthly rate or rates specified in section
356.59, subdivision 2, 3, 4, or 5, whichever appliesnew text end , from the last day of the strike period
until the date payment is received.
(c) If payment is received by the applicable pension fund director after one year and
before five years from the end of the strike, the payment amount is the amount determined
under section 356.551.
(d) Payments may not be made more than five years after the end of the strike.
new text begin
This section is effective July 1, 2018.
new text end
Minnesota Statutes 2016, section 356.44, is amended to read:
(a) Notwithstanding any provision of law to the contrary, a member of a pension plan
listed in section 356.30, subdivision 3, with at least two years of forfeited service taken
from a single pension plan, may repay a portion of all refunds. A partial refund repayment
must comply with this section.
(b) The minimum portion of a refund repayment is one-third of the total service credit
period of all refunds taken from a single plan.
(c) The cost of the partial refund repayment is the product of the cost of the total
repayment multiplied by the ratio of the restored service credit to the total forfeited service
credit. The total repayment amount includes interest at the deleted text begin annual rate of 8.5 percent for
any period for the Teachers Retirement Association and is 8.5 percent until June 30, 2015,
and eight percent thereafter for any other retirement plan listed in section 356.30, subdivision
3deleted text end new text begin applicable annual rate or rates specified in section 356.59, subdivision 2, 3, 4, or 5,
whichever appliesnew text end , compounded annually, from the refund date to the date repayment is
received.
(d) The restored service credit must be allocated based on the relationship the restored
service bears to the total service credit period for all refunds taken from a single pension
plan.
(e) This section does not authorize a public pension plan member to repay a refund if
the law governing the plan does not authorize the repayment of a refund of member
contributions.
new text begin
This section is effective July 1, 2018.
new text end
Minnesota Statutes 2016, section 356.50, subdivision 2, is amended to read:
(a) To obtain the public pension plan allowable
service credit, the eligible person under subdivision 1 shall pay the required member
contribution amount. The required member contribution amount is the member contribution
rate or rates in effect for the pension plan during the period of service covered by the back
pay award, applied to the unpaid gross salary amounts of the back pay award including
unemployment insurance, workers' compensation, or wages from other sources which
reduced the back award. No contributions may be made under this clause for compensation
covered by a public pension plan listed in section 356.30, subdivision 3, for employment
during the removal period. The person shall pay the required member contribution amount
within 60 days of the date of receipt of the back pay award or within 60 days of a billing
from the retirement fund, whichever is later.
(b) The public employer who wrongfully discharged the public employee must pay an
employer contribution on the back pay award. The employer contribution must be based
on the employer contribution rate or rates in effect for the pension plan during the period
of service covered by the back pay award, applied to the salary amount on which the member
contribution amount was determined under paragraph (a). deleted text begin Interest on both the required
member and employer contribution amount must be paid by the employer at the annual
compound rate of 8.5 percent for any period for the Teachers Retirement Association and
8.5 percent until June 30, 2015, and eight percent thereafter, for any other retirement plan
listed in section 356.30, subdivision 3, per year, expressed monthlydeleted text end new text begin The employer must pay
compound interest on both the required member and employer contribution amounts at the
applicable monthly rate or rates specified in section 356.59, subdivision 2, 3, 4, or 5,
whichever appliesnew text end , between the date the contribution amount would have been paid to the
date of actual payment. The employer payment must be made within 30 days of the payment
under paragraph (a).
new text begin
This section is effective July 1, 2018.
new text end
Minnesota Statutes 2016, section 356.551, subdivision 2, is amended to read:
(a) Unless the minimum purchase amount set forth in paragraph
(c) applies, the prior service credit purchase amount is an amount equal to the actuarial
present value, on the date of payment, as calculated by the chief administrative officer of
the pension plan and reviewed by the actuary retained under section 356.214, of the amount
of the additional retirement annuity obtained by the acquisition of the additional service
credit in this section.
(b) Calculation of this amount must be made using the preretirement interest rate
applicable to the public pension plan specified in section 356.215, subdivision 8, and the
mortality table adopted for the public pension plan. The calculation must assume continuous
future service in the public pension plan until, and retirement at, the age at which the
minimum requirements of the fund for normal retirement or retirement with an annuity
unreduced for retirement at an early age, including section 356.30, are met with the additional
service credit purchased. The calculation must also assume a full-time equivalent salary, or
actual salary, whichever is greater, and a future salary history that includes annual salary
increases at the applicable salary increase rate for the plan specified in section 356.215,
subdivision deleted text begin 4ddeleted text end new text begin 8new text end .
(c) The prior service credit purchase amount may not be less than the amount determined
by applying, for each year or fraction of a year being purchased, the sum of the employee
contribution rate, the employer contribution rate, and the additional employer contribution
rate, if any, applicable during that period, to the person's annual salary during that period,
or fractional portion of a year's salary, if applicable, plus interest at the deleted text begin annual rate of 8.5
percent until June 30, 2015, and eight percent thereafterdeleted text end new text begin applicable annual rate or rates
specified in section 356.59, subdivision 2, 3, 4, or 5, whichever applies, new text end compounded
annuallynew text begin ,new text end from the end of the year in which contributions would otherwise have been made
to the date on which the payment is received.
(d) Unless otherwise provided by statutes governing a specific plan, payment must be
made in one lump sum within one year of the prior service credit authorization or prior to
the member's effective date of retirement, whichever is earlier. Payment of the amount
calculated under this section must be made by the applicable eligible person.
(e) However, the current employer or the prior employer may, at its discretion, pay all
or any portion of the payment amount that exceeds an amount equal to the employee
contribution rates in effect during the period or periods of prior service applied to the actual
salary rates in effect during the period or periods of prior service, plus interest at the
new text begin applicable annual new text end rate deleted text begin of 8.5 percent a yeardeleted text end new text begin or rates specified in section 356.59, subdivision
2, 3, 4, or 5, whichever applies,new text end compounded annuallynew text begin ,new text end from the date on which the
contributions would otherwise have been made to the date on which the payment is made.
If the employer agrees to payments under this subdivision, the purchaser must make the
employee payments required under this subdivision within 90 days of the prior service credit
authorization. If that employee payment is made, the employer payment under this
subdivision must be remitted to the chief administrative officer of the public pension plan
within 60 days of receipt by the chief administrative officer of the employee payments
specified under this subdivision.
new text begin
This section is effective July 1, 2018.
new text end
new text begin
Whenever the payment of interest is required
with respect to any payment, including refunds, remittances, shortages, contributions, or
repayments, the rate of interest is the rate or rates specified in subdivisions 2 to 5 for each
public retirement plan.
new text end
new text begin
The interest rates for all retirement plans
administered by the Minnesota State Retirement System are as follows:
new text end
new text begin
Annual new text end |
new text begin
Monthly new text end |
||||
new text begin
before July 1, 2015 new text end |
new text begin
8.5 percent new text end |
new text begin
0.71 percent new text end |
|||
new text begin
from July 1, 2015, to June 30, 2018 new text end |
new text begin
8.0 percent new text end |
new text begin
0.667 percent new text end |
|||
new text begin
after June 30, 2018 new text end |
new text begin
7.5 percent new text end |
new text begin
0.625 percent new text end |
new text begin
The interest rates for all retirement
plans administered by the Public Employees Retirement Association are as follows:
new text end
new text begin
before July 1, 2015 new text end |
new text begin
8.5 percent new text end |
||||
new text begin
from July 1, 2015, to June 30, 2018 new text end |
new text begin
8.0 percent new text end |
||||
new text begin
after June 30, 2018 new text end |
new text begin
7.5 percent new text end |
new text begin
The interest rates for the retirement plan
administered by the Teachers Retirement Association are as follows:
new text end
new text begin
Annual new text end |
new text begin
Monthly new text end |
||||
new text begin
before July 1, 2018 new text end |
new text begin
8.5 percent new text end |
new text begin
0.71 percent new text end |
|||
new text begin
after June 30, 2018 new text end |
new text begin
7.5 percent new text end |
new text begin
0.625 percent new text end |
new text begin
The interest rates for the
retirement plan administered by the St. Paul Teachers Retirement Fund Association are as
follows:
new text end
new text begin
Annual new text end |
new text begin
Monthly new text end |
||||
new text begin
before July 1, 2015 new text end |
new text begin
8.5 percent new text end |
new text begin
0.71 percent new text end |
|||
new text begin
from July 1, 2015, to June 30, 2018 new text end |
new text begin
8.0 percent new text end |
new text begin
0.667 percent new text end |
|||
new text begin
after June 30, 2018 new text end |
new text begin
7.5 percent new text end |
new text begin
0.625 percent new text end |
new text begin
This section is effective July 1, 2018.
new text end
Minnesota Statutes 2016, section 490.121, subdivision 4, is amended to read:
(a) "Allowable service" means any calendar month, subject
to the service credit limit in subdivision 22, served as a judge at any time, during which the
judge received compensation for that service from the state, municipality, or county,
whichever applies, and for which the judge made any required member contribution. It also
includes any month served as a referee in probate for all referees in probate who were in
office before January 1, 1974.
(b) "Allowable service" also means a period of authorized leave of absence for which
the judge has made a payment in lieu of contributions, not in an amount in excess of the
service credit limit under subdivision 22. To obtain the service credit, the judge shall pay
an amount equal to the normal cost of the judges retirement plan on the date of return from
the leave of absence, as determined in the most recent actuarial report for the plan filed with
the Legislative Commission on Pensions and Retirement, multiplied by the judge's average
monthly salary rate during the authorized leave of absence and multiplied by the number
of months of the authorized leave of absence, plus deleted text begin annual compound interest at the rate of
8.5 percent until June 30, 2015, and eight percent thereafterdeleted text end new text begin interest at the applicable annual
rate or rates specified in section 356.59, subdivision 2, compounded annually, new text end from the date
of the termination of the leave to the date on which payment is made. The payment must
be made within one year of the date on which the authorized leave of absence terminated.
Service credit for an authorized leave of absence is in addition to a uniformed service leave
under section 490.1211.
(c) "Allowable service" does not mean service as a retired judge.
new text begin
This section is effective July 1, 2018.
new text end
Minnesota Statutes 2016, section 490.1211, is amended to read:
(a) A judge who is absent from employment by reason of service in the uniformed
services, as defined in United States Code, title 38, section 4303(13), and who returns to
state employment as a judge upon discharge from service in the uniformed service within
the time frame required in United States Code, title 38, section 4312(e), may obtain service
credit for the period of the uniformed service, provided that the judge did not separate from
uniformed service with a dishonorable or bad conduct discharge or under other than honorable
conditions.
(b) The judge may obtain credit by paying into the fund equivalent member contribution
based on the contribution rate or rates in effect at the time that the uniformed service was
performed multiplied by the full and fractional years being purchased and applied to the
annual salary rate. The annual salary rate is the average annual salary during the purchase
period that the judge would have received if the judge had continued to provide employment
services to the state rather than to provide uniformed service, or if the determination of that
rate is not reasonably certain, the annual salary rate is the judge's average salary rate during
the 12-month period of judicial employment rendered immediately preceding the purchase
period.
(c) The equivalent employer contribution and, if applicable, the equivalent employer
additional contribution, must be paid by the employing unit, using the employer and employer
additional contribution rate or rates in effect at the time that the uniformed service was
performed, applied to the same annual salary rate or rates used to compute the equivalent
member contribution.
(d) If the member equivalent contributions provided for in this section are not paid in
full, the judge's allowable service credit must be prorated by multiplying the full and
fractional number of years of uniformed service eligible for purchase by the ratio obtained
by dividing the total member contributions received by the total member contributions
otherwise required under this section.
(e) To receive allowable service credit under this section, the contributions specified in
this section and section 490.121 must be transmitted to the fund during the period which
begins with the date on which the individual returns to judicial employment and which has
a duration of three times the length of the uniformed service period, but not to exceed five
years. If the determined payment period is calculated to be less than one year, the
contributions required under this section to receive service credit may be within one year
from the discharge date.
(f) The amount of allowable service credit obtainable under this section and section
490.121 may not exceed five years, unless a longer purchase period is required under United
States Code, title 38, section 4312.
(g) The state court administrator shall pay interest on all equivalent member and employer
contribution amounts payable under this section. Interest must be deleted text begin computed at the rate of
8.5 percent until June 30, 2015, and eight percent thereafterdeleted text end new text begin at the applicable annual rate or
rates specified in section 356.59, subdivision 2, new text end compounded annuallynew text begin ,new text end from the end of each
fiscal year of the leave or break in service to the end of the month in which payment is
received.
new text begin
This section is effective July 1, 2018.
new text end
Minnesota Statutes 2016, section 490.124, subdivision 12, is amended to read:
(a) A person who ceases to be a judge is entitled to a refund in an
amount that is equal to all of the member's employee contributions to the judges' retirement
fund plus interest computed under section 352.22, subdivision 2.
(b) A refund of contributions under paragraph (a) terminates all service credits and all
rights and benefits of the judge and the judge's survivors under this chapter.
(c) A person who becomes a judge again after taking a refund under paragraph (a) may
reinstate the previously terminated allowable service credit, rights, and benefits by repaying
the total amount of the previously received refund. The refund repayment must include
interest deleted text begin on the total amount previously received at the annual rate of 8.5 percent until June
30, 2015, and eight percent thereafterdeleted text end new text begin at the applicable annual rate or rates specified in
section 356.59, subdivision 2new text end , compounded annually, from the date on which the refund
was received until the date on which the refund is repaid.
new text begin
This section is effective July 1, 2018.
new text end
Minnesota Statutes 2016, section 352.04, subdivision 2, is amended to read:
(a) The employee contribution to the fund must be
equal to the following percent of salary:
deleted text begin
from July 1, 2010, to June 30, 2014 deleted text end |
deleted text begin
5 deleted text end |
|
from July 1, 2014, deleted text begin and thereafterdeleted text end new text begin to June 30, 2018 new text end |
5.5 |
|
new text begin
from July 1, 2018, to June 30, 2019 new text end |
new text begin
5.75 new text end |
|
new text begin
after June 30, 2019 new text end |
new text begin
6 new text end |
(b) These contributions must be made by deduction from salary as provided in subdivision
4.
new text begin
(c) Contribution increases under paragraph (a) must be paid starting the first day of the
first full pay period after the effective date of the increase.
new text end
new text begin
This section is effective July 1, 2018.
new text end
Minnesota Statutes 2016, section 352.04, subdivision 3, is amended to read:
new text begin (a) new text end The employer contribution to the fund must be
equal to the following percent of salary:
deleted text begin
from July 1, 2010, to June 30, 2014 deleted text end |
deleted text begin
5 deleted text end |
|
from July 1, 2014, deleted text begin and thereafterdeleted text end new text begin to June 30, 2018 new text end |
5.5 |
|
new text begin
from July 1, 2018, to June 30, 2019 new text end |
new text begin
5.875 new text end |
|
new text begin
after June 30, 2019 new text end |
new text begin
6.25 new text end |
new text begin
(b) Contribution increases under paragraph (a) must be paid starting the first day of the
first full pay period after the effective date of the increase.
new text end
new text begin
This section is effective July 1, 2018.
new text end
Minnesota Statutes 2016, section 352.92, subdivision 1, is amended to read:
(a) Employee contributions of covered
correctional employees must be in an amount equal to the following percent of salary:
deleted text begin
from July 1, 2010, to June 30, 2014 deleted text end |
deleted text begin
8.6 deleted text end |
|
from July 1, 2014, deleted text begin and thereafterdeleted text end new text begin to June 30, 2018 new text end |
9.1 |
|
new text begin
after June 30, 2018 new text end |
new text begin
9.6 new text end |
(b) These contributions must be made by deduction from salary as provided in section
352.04, subdivision 4.
new text begin
(c) Contribution increases under paragraph (a) must be paid starting the first day of the
first full pay period after the effective date of the increase.
new text end
new text begin
This section is effective July 1, 2018.
new text end
Minnesota Statutes 2016, section 352.92, subdivision 2, is amended to read:
new text begin (a) new text end The employer shall contribute for covered
correctional employees an amount equal to the following percent of salary:
deleted text begin
from July 1, 2010, to June 30, 2014 deleted text end |
deleted text begin
12.1 deleted text end |
|
from July 1, 2014, deleted text begin and thereafterdeleted text end new text begin to June 30, 2018 new text end |
12.85 |
|
new text begin
after June 30, 2018 new text end |
new text begin
14.4 new text end |
new text begin
(b) Contribution increases under paragraph (a) must be paid starting the first day of the
first full pay period after the effective date of the increase.
new text end
new text begin
This section is effective July 1, 2018.
new text end
Minnesota Statutes 2016, section 352.92, is amended by adding a subdivision to
read:
new text begin
(a) Effective July 1, 2019, the employer
shall pay a supplemental contribution. The supplemental contribution is 1.45 percent of
salary for covered correctional employees from July 1, 2019, through June 30, 2020; 2.95
percent of salary for covered correctional employees from July 1, 2020, through June 30,
2021; and 4.45 percent of salary for covered correctional employees thereafter. The
supplemental contribution rate of 4.45 percent remains in effect until the market value of
the assets of the correctional state employees retirement plan of the Minnesota State
Retirement System equals or exceeds the actuarial accrued liability of the plan as determined
by the actuary retained under section 356.214. The expiration of the supplemental employer
contribution is effective the first day of the first full pay period of the fiscal year immediately
following the issuance of the actuarial valuation upon which the expiration is based.
new text end
new text begin
(b) The supplemental contribution under paragraph (a) must be paid starting the first
day of the first full pay period after the effective date of this subdivision.
new text end
new text begin
This section is effective July 1, 2018.
new text end
Minnesota Statutes 2016, section 352B.02, subdivision 1a, is amended to read:
(a) The member contribution is the following
percentage of the member's salary:
deleted text begin
(1) before the first day of the first pay period beginning after July 1, 2014 deleted text end |
deleted text begin
12.4 percent deleted text end |
|
deleted text begin (2) on or after the first day of the first pay period beginning afterdeleted text end new text begin from new text end July 1, 2014, to June 30, 2016 |
13.4 deleted text begin percent deleted text end |
|
deleted text begin
(3) after June 30, 2016
deleted text end
new text begin
from July 1, 2016, to June 30, 2018 new text end |
14.4 deleted text begin percent deleted text end |
|
new text begin
from July 1, 2018, to June 30, 2020 new text end |
new text begin
14.9 new text end |
|
new text begin
after June 30, 2020 new text end |
new text begin
15.4 new text end |
(b) These contributions must be made by deduction from salary as provided in section
352.04, subdivision 4.
new text begin
(c) Contribution increases under paragraph (a) must be paid starting the first day of the
first full pay period after the effective date of the increase.
new text end