SF 3456

as introduced - 82nd Legislature (2001 - 2002) Posted on 12/15/2009 12:00am

  1.1                          A bill for an act 
  1.2             relating to retirement; providing an additional 
  1.3             benefit for teachers previously covered by the money 
  1.4             purchase program; proposing coding for new law in 
  1.5             Minnesota Statutes, chapter 354. 
  1.6   BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
  1.7      Section 1.  [354.551] [ADDITIONAL BENEFIT FOR TEACHERS 
  1.8   PREVIOUSLY COVERED BY THE MONEY PURCHASE PROGRAM.] 
  1.9      Subdivision 1.  [ADDITIONAL BENEFIT ENTITLEMENT.] Eligible 
  1.10  teachers and eligible retired teachers as defined in subdivision 
  1.11  2, paragraph (a) or (b), are entitled to receive the applicable 
  1.12  additional benefit amount determined under subdivision 3, 
  1.13  paragraph (c) or (d), unless the applicable person files a 
  1.14  written notification with the executive director of the teachers 
  1.15  retirement association that the additional benefit not be paid. 
  1.16     Subd. 2.  [ELIGIBILITY.] (a) An eligible teacher for 
  1.17  purposes of this section is a person who: 
  1.18     (1) is a teacher as defined in section 354.05, subdivision 
  1.19  2, on the date of enactment of this act; and 
  1.20     (2) rendered teaching service as defined in section 354.05, 
  1.21  subdivision 3, before the 1969-1970 school year, did not take a 
  1.22  refund of member contributions upon any prior termination of 
  1.23  teaching service, made a post-January 1, 1969, benefit program 
  1.24  election under Minnesota Statutes 1971, section 354.145, 
  1.25  subdivisions 1, clause (1), and 2, clause (1), but was not 
  2.1   covered by the improved money purchase program savings clause, 
  2.2   section 354.55, subdivision 17. 
  2.3      (b) An eligible retired teacher for purposes of this 
  2.4   section is a person who: 
  2.5      (1) was a teacher as defined in section 354.05, subdivision 
  2.6   2; 
  2.7      (2) rendered teaching service as defined in section 354.05, 
  2.8   subdivision 3, either during the 1968-1969 school year, but was 
  2.9   not covered by the improved money purchase program savings 
  2.10  clause, section 354.55, subdivision 17, or before the 1968-1969 
  2.11  school year, did not take a refund of member contributions upon 
  2.12  the termination of teacher service, and was eligible to make an 
  2.13  election under Minnesota Statutes 1971, section 354.55, 
  2.14  subdivision 8; and 
  2.15     (3) retired after December 31, 1996, and before January 1, 
  2.16  2002. 
  2.17     Subd. 3.  [DETERMINATION OF ADDITIONAL BENEFIT AMOUNT.] (a) 
  2.18  By October 1, 2002, the executive director of the teachers 
  2.19  retirement association shall determine which active or retired 
  2.20  teachers are eligible to receive an additional benefit amount 
  2.21  under this section and the amount of each person's additional 
  2.22  benefit amount. 
  2.23     (b) The total actuarial present value of the additional 
  2.24  benefit amounts payable under this section, calculated as of 
  2.25  July 1, 2002, using a six percent postretirement interest rate 
  2.26  and the postretirement mortality table applicable to the 
  2.27  teachers retirement association, must not exceed $296,600,000. 
  2.28     (c) The executive director shall calculate, for each 
  2.29  eligible active teacher under subdivision 1, paragraph (a), 
  2.30  one-half of the difference, if a positive number, between the 
  2.31  projected retirement annuity amount that the person will be 
  2.32  eligible to receive as of July 1, 2002, under section 354.44, 
  2.33  subdivision 6, and the single life retirement annuity amount 
  2.34  that the person would receive under the improved money purchase 
  2.35  program, section 354.44, subdivision 2, as of July 1, 2002. 
  2.36     (d) The executive director shall determine the following: 
  3.1      (1) for each eligible retired teacher under subdivision 1, 
  3.2   paragraph (b), the lump sum catch-up additional benefit, which 
  3.3   is the applicable monthly increase amount for the calendar year 
  3.4   of retirement multiplied by the number of months that elapsed 
  3.5   during the period between the date of retirement and July 1, 
  3.6   2002: 
  3.7       calendar year of retirement   monthly increase amount
  3.8                 1997                         $322.50
  3.9                 1998                         $322.50
  3.10                1999                         $519.00
  3.11                2000                         $650.00
  3.12                2001                         $713.50. 
  3.13     (2) For each eligible retired teacher under subdivision 1, 
  3.14  paragraph (b), the ongoing additional benefit, which is one-half 
  3.15  of the difference, if a positive number, between the retirement 
  3.16  annuity amount that the person received on July 1, 2002, under 
  3.17  section 354.44, subdivision 6, and the single life retirement 
  3.18  annuity amount that the person would receive under the improved 
  3.19  money purchase program, section 354.44, subdivision 2, as of 
  3.20  July 1, 2002. 
  3.21     (e) The executive director shall total the actuarial 
  3.22  present value amount difference of all positive number 
  3.23  calculations under paragraph (c) and the actuarial present value 
  3.24  amount of the benefit increases under paragraph (d).  If the 
  3.25  total present value amount is greater than the maximum dollar 
  3.26  amount specified in paragraph (b), the executive director shall 
  3.27  divide the maximum dollar amount specified in paragraph (b) by 
  3.28  the total present value amount difference calculated under this 
  3.29  paragraph. 
  3.30     (f) If the total present value amount difference calculated 
  3.31  under paragraph (e) is equal to or less than the maximum dollar 
  3.32  amount specified in paragraph (b), the additional retirement 
  3.33  annuity payable to each eligible active teacher or retired 
  3.34  teacher is the amount calculated under paragraph (c) or the 
  3.35  amounts determined under paragraph (d).  If the total present 
  3.36  value amount difference calculated under paragraph (e) is 
  3.37  greater than the maximum dollar amount specified in paragraph 
  3.38  (b), the additional retirement annuity payable to each eligible 
  4.1   retired teacher is that portion of the amount or amounts 
  4.2   calculated under paragraph (c) or determined under paragraph 
  4.3   (d), determined by applying the proportional factor calculated 
  4.4   under paragraph (e). 
  4.5      (g) The lump sum catch-up additional benefit is payable on 
  4.6   November 1, 2002.  The ongoing additional retirement annuity is 
  4.7   payable beginning November 1, 2002, for persons who were 
  4.8   receiving a retirement annuity on July 1, 2002, or with the 
  4.9   initial retirement annuity payment for persons who were active, 
  4.10  deferred, or inactive members on July 1, 2002.  The ongoing 
  4.11  additional retirement annuity must be included in the base for 
  4.12  any postretirement adjustment payable under section 11A.18.  The 
  4.13  applicable required reserves amount must be transferred on 
  4.14  November 1, 2002, for persons who were receiving an ongoing 
  4.15  additional retirement annuity on July 1, 2002, or on the date of 
  4.16  retirement for persons who were active members on July 1, 2002. 
  4.17     Subd. 4.  [DURATION OF ADDITIONAL BENEFIT.] The additional 
  4.18  benefit amount is payable for life or for the duration of the 
  4.19  selected optional annuity form, whichever applies.  
  4.20     Subd. 5.  [NO PAYMENT TO ESTATE; NO RETROACTIVITY.] (a) 
  4.21  Nothing in this section authorizes the payment of an additional 
  4.22  benefit amount under this section to an estate or to a survivor 
  4.23  or beneficiary other than under an optional annuity form. 
  4.24     (b) Nothing in this section authorizes the payment of an 
  4.25  additional benefit amount for any period before November 1, 
  4.26  2002, or the date of retirement, whichever is later. 
  4.27     (c) Nothing in this section authorizes the payment of an 
  4.28  additional benefit amount to a person who was or is entitled to 
  4.29  have their retirement annuity calculated under section 354.44, 
  4.30  subdivision 2. 
  4.31     Subd. 6.  [REPORT.] (a) On January 15, 2003, and annually 
  4.32  thereafter until the January 15 occurring after the last 
  4.33  eligible person retires, the executive director shall prepare 
  4.34  and file a report on the additional benefit amounts payable 
  4.35  under this section. 
  4.36     (b) The report shall indicate the following for the period 
  5.1   since the effective date of this section or the date of the most 
  5.2   recent prior report, whichever applies:  
  5.3      (1) the number of retired teachers who received an 
  5.4   additional benefit amount under this section; 
  5.5      (2) the total actuarial present value of the additional 
  5.6   benefit amounts payable under this section; 
  5.7      (3) the smallest, largest, mean, and median additional 
  5.8   benefit amounts paid; and 
  5.9      (4) the smallest, largest, mean, and median retirement 
  5.10  annuities payable immediately prior to the payment of the 
  5.11  additional benefit amounts to the retired teachers who received 
  5.12  an additional benefit amount. 
  5.13     (c) The report must be filed with the chairs of the 
  5.14  legislative commission on pensions and retirement, the committee 
  5.15  on governmental operations and veterans affairs policy of the 
  5.16  house of representatives, the committee on state government 
  5.17  finance of the house of representatives, the committee on ways 
  5.18  and means of the house of representatives, the committee on 
  5.19  state and local governmental operations of the senate, the state 
  5.20  government, economic development and the judiciary budget 
  5.21  division of the senate, and the finance committee of the senate.