SF 489

as introduced - 88th Legislature (2013 - 2014) Posted on 04/02/2013 12:42pm

A bill for an act
relating to retirement; former local police and paid fire relief associations;
revising and repealing various statutes to reflect the recent mergers of local
police and salaried firefighter relief associations and consolidation accounts
with the public employees police and fire retirement plan; amending Minnesota
Statutes 2012, sections 6.495, subdivisions 1, 3; 6.67; 13D.01, subdivision 1;
69.011, subdivisions 1, 2, 3, 4; 69.021, subdivisions 1, 2, 3, 4, 5, 7, 7a, 8, 9,
10, 11; 69.031, subdivisions 1, 3, 5; 69.041; 69.051, subdivisions 1, 1a, 1b, 2,
3, 4; 69.33; 69.77, subdivisions 1, 2, 3, 4, 5, 6, 7, 8, 9, 10, 11, 12, 13; 69.771,
subdivision 1; 69.80; 275.70, subdivision 5; 297I.10, subdivision 1; 345.381;
353.01, subdivisions 2a, 2b, 6, 10, 16; 353.64, subdivision 1a; 353.659; 353.665,
subdivisions 1, 5, 8; 353.71, subdivision 1; 356.20, subdivision 2; 356.215,
subdivision 18; 356.216; 356.219, subdivisions 1, 2, 8; 356.406, subdivision
1; 356A.01, subdivision 19; 356A.06, subdivision 4; 356A.07, subdivision 2;
423A.02, subdivisions 1, 1b, 2, 3, 3a, 4, 5; 424A.001, subdivision 4; 424A.02,
subdivision 9; 475.52, subdivision 6; repealing Minnesota Statutes 2012, sections
69.021, subdivision 6; 353.64, subdivision 3; 353.665, subdivisions 2, 3, 4, 6,
7, 9, 10; 353.667; 353.668; 353.669; 353.6691; 353A.01; 353A.02; 353A.03;
353A.04; 353A.05; 353A.06; 353A.07; 353A.08; 353A.081; 353A.083;
353A.09; 353A.10; 353B.01; 353B.02; 353B.03; 353B.04; 353B.05; 353B.06;
353B.07; 353B.08; 353B.09; 353B.10; 353B.11; 353B.12; 353B.13; 353B.14;
423A.01; 423A.02, subdivision 1a; 423A.04; 423A.05; 423A.07; 423A.10;
423A.11; 423A.12; 423A.13; 423A.14; 423A.15; 423A.16; 423A.17; 423A.171;
423A.18; 423A.19; 423A.20; 423A.21; 423A.22.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

Section 1.

Minnesota Statutes 2012, section 6.495, subdivision 1, is amended to read:

Subdivision 1.

Audit and examinations.

All powers and duties conferred and
imposed upon the state auditor with respect to state, county, and first-class city officers,
institutions, and property are hereby extended to the various fire deleted text begin and police deleted text end relief
associations in the state. The state auditor shall annually audit the special and general
funds of the relief association or, at the request of the board of trustees or the municipality,
the state auditor may contract for an annual audit by a certified public accountant. The
state auditor may determine that an annual audit is not necessary, in which case the state
auditor shall develop a plan for examination of unaudited relief associations, and shall
prescribe suitable systems of accounts and budgeting, and forms, books, and instructions
concerning the same.

Copies of the written report of the state auditor on the financial condition and
accounts of the relief association deleted text begin shall deleted text end new text begin must new text end be filed with the board of trustees of the
relief association and the governing body of the municipality associated with the relief
association. If the report discloses malfeasance, misfeasance, or nonfeasance with regard
to relief association funds, copies thereof deleted text begin shall deleted text end new text begin must new text end be filed with the city attorney or county
attorney in the city or county in which the relief association is located, and these officials of
the law shall institute proceedings, civil or criminal, as the law and public interest require.

Sec. 2.

Minnesota Statutes 2012, section 6.495, subdivision 3, is amended to read:

Subd. 3.

Report to commissioner of revenue.

The state auditor shall file with
the commissioner of revenue a financial compliance report certifying for each relief
association:

(1) the completion of the annual financial report required deleted text begin pursuant to deleted text end new text begin under new text end section
69.051 and the auditing or certification of those financial reports deleted text begin pursuant to deleted text end new text begin under
new text end subdivision 1; and

(2) the receipt of any actuarial valuations required deleted text begin pursuant to deleted text end new text begin under new text end section deleted text begin 69.77
or deleted text end 69.773 new text begin or sections 31 to 43 new text end .

Sec. 3.

Minnesota Statutes 2012, section 6.67, is amended to read:

6.67 PUBLIC ACCOUNTANTS; REPORT OF POSSIBLE MISCONDUCT.

Whenever a public accountant in the course of auditing the books and affairs of a
political subdivision or a local public pension plan governed by deleted text begin section 69.77, deleted text end sections
69.771 to 69.775, or chapter 354A or 424A, new text begin or sections 31 to 43, new text end discovers evidence
pointing to nonfeasance, misfeasance, or malfeasance, on the part of an officer or
employee in the conduct of duties and affairs, the public accountant shall promptly make
a report of such discovery to the state auditor and the county attorney of the county in
which the governmental unit is situated and the public accountant shall also furnish a
copy of the report of audit upon completion to said officers. The county attorney shall
act on such report in the same manner as required by law for reports made to the county
attorney by the state auditor.

Sec. 4.

Minnesota Statutes 2012, section 13D.01, subdivision 1, is amended to read:

Subdivision 1.

In executive branch, local government.

All meetings, including
executive sessions, must be open to the public

(a) of a state

(1) agency,

(2) board,

(3) commission, or

(4) department,

when required or permitted by law to transact public business in a meeting;

(b) of the governing body of a

(1) school district however organized,

(2) unorganized territory,

(3) county,

(4) statutory or home rule charter city,

(5) town, or

(6) other public body;

(c) of any

(1) committee,

(2) subcommittee,

(3) board,

(4) department, or

(5) commission,

of a public body; and

(d) of the governing body or a committee of:

(1) a statewide public pension plan defined in section 356A.01, subdivision 24; or

(2) a local public pension plan governed by deleted text begin section 69.77, deleted text end sections 69.771 to 69.775,
or chapter 354A new text begin , or sections 31 to 43 new text end .

Sec. 5.

Minnesota Statutes 2012, section 69.011, subdivision 1, is amended to read:

Subdivision 1.

Definitions.

Unless the language or context clearly indicates that
a different meaning is intended, the following words and terms, for the purposes of this
chapter and chapters 423, 423A, 424 and 424A, have the meanings ascribed to them:

(a) "Commissioner" means the commissioner of revenue.

(b) "Municipality" means:

(1) a home rule charter or statutory city;

(2) an organized town;

(3) a park district subject to chapter 398;

(4) the University of Minnesota;

(5) for purposes of the fire state aid program only, an American Indian tribal
government entity located within a federally recognized American Indian reservation;

(6) for purposes of the police state aid program only, an American Indian tribal
government with a tribal police department which exercises state arrest powers under
section 626.90, 626.91, 626.92, or 626.93;

(7) for purposes of the police state aid program only, the Metropolitan Airports
Commission; and

(8) for purposes of the police state aid program only, the Department of Natural
Resources and the Department of Public Safety with respect to peace officers covered
under chapter 352B.

(c) "Minnesota Firetown Premium Report" means a form prescribed by the
commissioner containing space for reporting by insurers of fire, lightning, sprinkler
leakage and extended coverage premiums received upon risks located or to be performed
in this state less return premiums and dividends.

(d) "Firetown" means the area serviced by any municipality having a qualified fire
department or a qualified incorporated fire department having a subsidiary volunteer
firefighters' relief association.

(e) "Market value" means latest available market value of all property in a taxing
jurisdiction, whether the property is subject to taxation, or exempt from ad valorem
taxation obtained from information which appears on abstracts filed with the commissioner
of revenue or equalized by the State Board of Equalization.

(f) "Minnesota Aid to Police Premium Report" means a form prescribed by the
commissioner for reporting by each fire and casualty insurer of all premiums received
upon direct business received by it in this state, or by its agents for it, in cash or otherwise,
during the preceding calendar year, with reference to insurance written for insuring against
the perils contained in auto insurance coverages as reported in the Minnesota business
schedule of the annual financial statement which each insurer is required to file with
the commissioner in accordance with the governing laws or rules less return premiums
and dividends.

(g) "Peace officer" means any person:

(1) whose primary source of income derived from wages is from direct employment
by a municipality or county as a law enforcement officer on a full-time basis of not less
than 30 hours per week;

(2) who has been employed for a minimum of six months prior to December 31
preceding the date of the current year's certification under subdivision 2, clause (b);

(3) who is sworn to enforce the general criminal laws of the state and local ordinances;

(4) who is licensed by the Peace Officers Standards and Training Board and is
authorized to arrest with a warrant; and

(5) who is a member of the State Patrol retirement plan or the public employees
police and fire fund.

(h) "Full-time equivalent number of peace officers providing contract service" means
the integral or fractional number of peace officers which would be necessary to provide
the contract service if all peace officers providing service were employed on a full-time
basis as defined by the employing unit and the municipality receiving the contract service.

(i) "Retirement benefits other than a service pension" means any disbursement
authorized under section 424A.05, subdivision 3, clauses (3) and (4).

(j) "Municipal clerk, municipal clerk-treasurer, or county auditor" means:

(1) for the police state aid program deleted text begin and police relief association financial reports deleted text end :

(i) the person who was elected or appointed to the specified position or, in the
absence of the person, another person who is designated by the applicable governing body;

(ii) in a park district, the secretary of the board of park district commissioners;

(iii) in the case of the University of Minnesota, the official designated by the Board
of Regents;

(iv) for the Metropolitan Airports Commission, the person designated by the
commission;

(v) for the Department of Natural Resources or the Department of Public Safety, the
respective commissioner;

(vi) for a tribal police department which exercises state arrest powers under section
626.90, 626.91, 626.92, or 626.93, the person designated by the applicable American
Indian tribal government; and

(2) for the fire state aid program and fire relief association financial reports, the
person who was elected or appointed to the specified position, or, for governmental
entities other than counties, if the governing body of the governmental entity designates
the position to perform the function, the chief financial official of the governmental entity
or the chief administrative official of the governmental entity.

(k) "Voluntary statewide lump-sum volunteer firefighter retirement plan" means the
retirement plan established by chapter 353G.

Sec. 6.

Minnesota Statutes 2012, section 69.011, subdivision 2, is amended to read:

Subd. 2.

Qualification for fire or police state aid.

(a) Unless retirement coverage
is provided by the voluntary statewide lump-sum volunteer firefighter retirement plan, in
order to qualify to receive fire state aid, on or before March 15 annually, in conjunction
with the financial report required pursuant to section 69.051, the clerk of each municipality
having a duly organized fire department as provided in subdivision 4, or the secretary of
each independent nonprofit firefighting corporation having a subsidiary incorporated
firefighters' relief association new text begin , new text end whichever is applicable, and the fire chief, shall jointly
certify the existence of the municipal fire department or of the independent nonprofit
firefighting corporation, whichever is applicable, which meets the minimum qualification
requirements set forth in this subdivision, and the fire personnel and equipment of the
municipal fire department or the independent nonprofit firefighting corporation as of the
preceding December 31.

(b) Where retirement coverage is provided by the voluntary statewide lump-sum
volunteer firefighter retirement plan, new text begin in order to qualify to receive fire state aid, on or
before March 15, annually, new text end the executive director of the Public Employees Retirement
Association shall certify the existence of that coverage for each municipality and the
municipal clerk or independent nonprofit firefighting corporation secretary, whichever
applies, and the applicable fire chief shall certify the fire personnel and fire department
equipment as of the preceding December 31.

deleted text begin (c) Certification must be made to the commissioner on a form prescribed by the
commissioner and shall include any other facts the commissioner may require. The
certification must be made to the commissioner in duplicate. Each copy of the certificate
must be duly executed and is deemed to be an original. The commissioner shall forward
one copy to the auditor of the county wherein the fire department is located and shall
retain one copy.
deleted text end

deleted text begin (d) On or before March 15 annually the clerk of each municipality having a duly
organized police department and having a duly incorporated relief association shall certify
that fact to the county auditor of the county where the police department is located and to
the commissioner on a form prescribed by the commissioner together with the other facts
the commissioner or auditor may require.
deleted text end

deleted text begin (e) deleted text end new text begin (c) new text end Except as provided in subdivision 2b, on or before March 15 annually, new text begin in
order to qualify to receive police state aid, new text end the clerk of each municipality and the auditor of
each county employing one or more peace officers as defined in subdivision 1, clause (g),
shall certify the number of such peace officers to the commissioner on forms prescribed by
the commissioner. Credit for officers employed less than a full year must be apportioned.
Each full month of employment of a qualifying officer during the calendar year entitles the
employing municipality or county to credit for 1/12 of the payment for employment of a
peace officer for the entire year. For purposes of sections 69.011 to 69.051, employment
of a peace officer commences when the peace officer is entered on the payroll of the
respective municipal police department or county sheriff's department. No peace officer
may be included in the certification of the number of peace officers by more than one
deleted text begin municipality or county deleted text end new text begin employing unit new text end for the same month.

new text begin (d) A certification made under this subdivision must be filed with the commissioner,
must be made on a form prescribed by the commissioner, and must include any other facts
that the commissioner requires.
new text end

Sec. 7.

Minnesota Statutes 2012, section 69.011, subdivision 3, is amended to read:

Subd. 3.

Failure to file certificate deemed waiver.

new text begin (a) new text end If a certification required by
this section is not filed with the commissioner by the due date prescribed by this section,
the commissioner shall notify the new text begin county, the new text end municipality new text begin , new text end or the nonprofit firefighting
corporation that a portion or all of its current year aid will be forfeited if the certification
is not received within ten days.

new text begin (b) new text end The amount of aid forfeited is equal to the amount of state police aid or state fire
aid determined for the new text begin county, the new text end municipality new text begin , new text end or new text begin the nonprofit new text end firefighting corporation
for the current year, multiplied by five percent for each week or fraction of a week that
this certification is late. The penalty deleted text begin will deleted text end new text begin must new text end be computed beginning ten days after the
postmark date of the commissioner's notification as required under this subdivision. All
forfeited aid amounts revert to the general fund in the state treasury. Failure to receive the
certificate form deleted text begin cannot deleted text end new text begin may not new text end be used as a defense for deleted text begin not filing deleted text end new text begin a failure to file new text end .

Sec. 8.

Minnesota Statutes 2012, section 69.011, subdivision 4, is amended to read:

Subd. 4.

Qualification for new text begin fire new text end state aid.

deleted text begin Any deleted text end new text begin (a) A new text end municipality in this state
new text begin qualifies to receive fire state aid if it meets the general requirements of paragraph (b) and
if it meets the specific requirements of paragraph (c).
new text end

new text begin (b) Minimum qualifications for fire state aid include the following:
new text end

new text begin (1) new text end having for more than one year an organized fire department and officially
established by the governing body of the municipality or an independent nonprofit
firefighting corporation created under the nonprofit corporation act of this state and
operating exclusively for firefighting purposes and providing retirement and relief benefits
to its members deleted text begin , deleted text end new text begin ; and
new text end

new text begin (2) new text end having a separate subsidiary incorporated firefighter's relief deleted text begin and pension
deleted text end association providing retirement and relief benefits, or participating in the voluntary
statewide lump-sum volunteer firefighter retirement plan deleted text begin , may qualify to receive state aid
if it meets the following deleted text end new text begin or, if a paid fire department, having retirement coverage by the
public employees police and fire retirement plan.
new text end

new text begin (c) new text end Minimum requirements new text begin for fire state aid also include the following new text end or new text begin their
new text end equivalent as determined by the state fire marshal deleted text begin by July 1, 1972 deleted text end :

deleted text begin (a) deleted text end new text begin (1) having new text end ten paid or volunteer firefighters including a fire chief and assistant
fire chief deleted text begin , and deleted text end new text begin ;
new text end

deleted text begin (b) deleted text end new text begin (2) having new text end regular scheduled meetings and frequent drills including instructions
in firefighting tactics and in the use, care, and operation of all fire apparatus and
equipment deleted text begin , and deleted text end new text begin ;
new text end

deleted text begin (c) deleted text end new text begin (3) having new text end a motorized fire truck equipped with a motorized pump, 250 gallon or
larger water tank, 300 feet of one inch or larger fire hose in two lines with combination
spray and straight stream nozzles, five-gallon hand pumps--tank extinguisher or equivalent,
dry chemical extinguisher or equivalent, ladders, extension ladders, pike poles, crow bars,
axes, lanterns, fire coats, helmets, new text begin and new text end boots deleted text begin , and deleted text end new text begin ;
new text end

deleted text begin (d) deleted text end new text begin (4) having new text end apparatus suitably housed in a building of good construction with
facilities for care of hose and equipment deleted text begin , and deleted text end new text begin ;
new text end

deleted text begin (e) deleted text end new text begin (5) having new text end a reliable and adequate method of receiving fire alarms by telephone
or with electric siren and suitable means of sounding an alarm deleted text begin , and deleted text end new text begin ;
new text end

deleted text begin (f) deleted text end new text begin (6) new text end if response is to be provided outside the corporate limits of the municipality
wherein the fire department is located, deleted text begin the municipality has deleted text end new text begin having new text end another piece of
motorized apparatus to make the response deleted text begin , deleted text end new text begin ; new text end and

deleted text begin (g) deleted text end new text begin (7) meeting new text end other requirements new text begin that new text end the commissioner establishes by rule.

Sec. 9.

Minnesota Statutes 2012, section 69.021, subdivision 1, is amended to read:

Subdivision 1.

Minnesota Firetown Premium Report and Minnesota Aid to
Police Premium Report.

The commissioner shall, at the time of mailing tax forms,
send blank copies of the Minnesota Firetown Premium Report and when applicable the
Minnesota Aid to Police Premium Report to each insurer, including township and farmers
mutual insurance companies licensed to write insurance as described in section 69.011,
subdivision 1, clauses (c) and (f) in this state. These reports deleted text begin shall deleted text end new text begin must new text end contain space
for the insurers name, address, gross premiums less return premiums, dividends, net
premiums, certification and other facts new text begin that new text end the commissioner may require.

Sec. 10.

Minnesota Statutes 2012, section 69.021, subdivision 2, is amended to read:

Subd. 2.

Report of premiums.

new text begin (a) new text end Each insurer, including township and farmers
mutual insurers where applicable, shall return to the commissioner the reports described in
subdivision 1 certified by its secretary and president or chief financial officer.

new text begin (b) new text end The Minnesota Firetown Premium Report deleted text begin shall deleted text end new text begin must new text end contain a true and accurate
statement of the total premium for all gross direct fire, lightning, sprinkler leakage, and
extended coverage insurance of all domestic mutual insurers and the total premiums for
all gross direct fire, lightning, sprinkler leakage and extended coverage insurance of all
other insurers, less return premiums and dividends received by them on that business
written or done during the preceding calendar year upon property located within the state
or brought into the state for temporary use. The fire and extended coverage portion of
multiperil and multiple peril package premiums and all other combination premiums deleted text begin shall
deleted text end new text begin must new text end be determined by applying percentages determined by the commissioner or by rating
bureaus recognized by the commissioner.

new text begin (c) new text end The Minnesota Aid to Police Premium Report deleted text begin shall deleted text end new text begin must new text end contain a true and
accurate statement of the total premiums, less return premiums and dividends, on all direct
business received by such insurer in this state, or by its agents for it, in cash or otherwise,
during the preceding calendar year, with reference to insurance written for perils described
in section 69.011, subdivision 1, clause (f).

Sec. 11.

Minnesota Statutes 2012, section 69.021, subdivision 3, is amended to read:

Subd. 3.

Penalty for fraudulent, incorrect, incomplete returns and late filing of
report.

(a) When it appears to the commissioner that any insurer has made an incomplete or
inaccurate report new text begin , new text end the commissioner shall return the report and demand that a complete and
accurate report be filed. If the insurer fails to file a report on or before March 1, annually,
the insurer deleted text begin shall be deleted text end new text begin is new text end liable and shall pay $25 for each seven days deleted text begin delinquent deleted text end new text begin , new text end or fraction
thereof new text begin , that the report is delinquent, but new text end not to exceed $200. If the insurer fails to file a
corrected report within 30 days after demand, the insurer is liable for the penalties provided
in deleted text begin this subdivision deleted text end new text begin paragraph (b) or (c) new text end for knowingly filing an inaccurate or false report.

(b) Any insurer deleted text begin who deleted text end new text begin which new text end knowingly makes and files an inaccurate or false report
deleted text begin shall be deleted text end new text begin is new text end liable to a fine new text begin in an amount new text end of not less than $25 nor more than $1,000 new text begin , as
determined by the commissioner, new text end and new text begin additionally new text end the commissioner of commerce may
revoke the insurer's certificate of authority.

(c) Any person whose duty it is to make the report who fails or refuses to make it
within 30 days after notification by the commissioner shall be fined new text begin an amount of new text end not
more than $1,000.

new text begin (d) new text end Failure of the insurer to receive a reporting form deleted text begin shall deleted text end new text begin does new text end not excuse the insurer
from filing the report.

Sec. 12.

Minnesota Statutes 2012, section 69.021, subdivision 4, is amended to read:

Subd. 4.

Determination of qualified state aid recipients; certification to
commissioner of management and budget.

(a) The commissioner shall determine
which municipalities and independent nonprofit firefighting corporations are qualified to
receive fire state aid new text begin directly or are qualified to receive the benefit of fire state aid paid
to the voluntary statewide lump-sum volunteer firefighter retirement plan new text end and which
municipalities and counties are qualified to receive police state aid.

(b) The commissioner shall determine qualification for state aid upon receipt of:

(1) the fire department personnel and equipment certification or the police department
and qualified peace officers certificate, whichever applies, required under section 69.011;

(2) the financial compliance report required under section 6.495, subdivision 3, if
applicable; and

(3) any other relevant information which comes to the attention of the commissioner.

(c) Upon completion of the determination, on or before October 1, the commissioner
shall calculate the amount of:

(1) the police state aid which each county or municipality is to receive under
subdivisions 5, 6, 7a, and 10; and

(2) the fire state aid which each municipality or nonprofit firefighting corporation
is to receive under subdivisions 5 and 7.

(d) The commissioner shall certify to the commissioner of management and budget
the name of each county or municipality, and the amount of state aid which each county or
municipality is to receive, in the case of police state aid. The commissioner shall certify to
the commissioner of management and budget the name of each municipality or independent
nonprofit firefighting corporation and the amount of state aid which each municipality
or independent nonprofit firefighting corporation is to receive new text begin directly or the amount of
state aid which the voluntary statewide lump-sum volunteer firefighter retirement plan is
qualified to receive on behalf of the municipality or corporation new text end , in the case of fire state aid.

Sec. 13.

Minnesota Statutes 2012, section 69.021, subdivision 5, is amended to read:

Subd. 5.

Calculation of state aid.

(a) The amount of fire state aid available for
apportionment, before the addition of the minimum fire state aid allocation amount under
subdivision 7, is equal to 107 percent of the amount of premium taxes paid to the state
upon the fire, lightning, sprinkler leakage, and extended coverage premiums reported to
the commissioner by insurers on the Minnesota Firetown Premium Report. This amount
must be reduced by the amount required to pay the state auditor's costs and expenses of
the audits or exams of the firefighters relief associations.

The total amount for apportionment in respect to fire state aid must not be less than
two percent of the premiums reported to the commissioner by insurers on the Minnesota
Firetown Premium Report after subtracting the following amounts:

(1) the amount required to pay the state auditor's costs and expenses of the audits or
exams of the firefighters relief associations; and

(2) one percent of the premiums reported by town and farmers' mutual insurance
companies and mutual property and casualty companies with total assets of $5,000,000 or
less.

(b) The total amount for apportionment as police state aid is equal to 104 percent
of the amount of premium taxes paid to the state on the premiums reported to the
commissioner by insurers on the Minnesota Aid to Police Premium Report deleted text begin , reduced by
the amount required to pay the costs and expenses of the state auditor for audits or exams
of police relief associations deleted text end . The total amount for apportionment in respect to the police
state aid program must not be less than two percent of the amount of premiums reported
to the commissioner by insurers on the Minnesota Aid to Police Premium Report deleted text begin after
subtracting the amount required to pay the state auditor's cost and expenses of the audits
or exams of the police relief associations deleted text end .

(c) The commissioner shall calculate the percentage of increase or decrease reflected
in the apportionment over or under the previous year's available state aid using the same
premiums as a basis for comparison.

(d) In addition to the amount for apportionment of police state aid under paragraph
(b), each year $100,000 must be apportioned for police state aid. An amount sufficient to
pay this increase is annually appropriated from the general fund.

Sec. 14.

Minnesota Statutes 2012, section 69.021, subdivision 7, is amended to read:

Subd. 7.

Apportionment of fire state aid to municipalities and relief associations.

(a) The commissioner shall apportion the fire state aid relative to the premiums reported
on the Minnesota Firetown Premium Reports filed under this chapter to each municipality
and/or firefighters relief association new text begin qualified under section 69.011, subdivision 4 new text end .

(b) The commissioner shall calculate an initial fire state aid allocation amount for each
municipality or fire department under paragraph (c) and new text begin , if applicable, new text end a minimum fire state
aid allocation amount for each municipality or fire department under paragraph (d). The
municipality or fire department must deleted text begin receive deleted text end new text begin be apportioned new text end the larger fire state aid amount.

(c) The initial fire state aid allocation amount is the amount available for
apportionment as fire state aid under subdivision 5, without new text begin the new text end inclusion of any additional
funding amount to support a minimum fire state aid amount under section 423A.02,
subdivision 3, allocated one-half in proportion to the population as shown in the last
official statewide federal census for each fire town and one-half in proportion to the market
value of each fire town, including (1) the market value of tax-exempt property and (2) the
market value of natural resources lands receiving in lieu payments under sections 477A.11
to 477A.14, but excluding the market value of minerals. In the case of incorporated or
municipal fire departments furnishing fire protection to other cities, towns, or townships
as evidenced by valid fire service contracts filed with the commissioner, the distribution
must be adjusted proportionately to take into consideration the crossover fire protection
service. Necessary adjustments must be made to subsequent apportionments. In the case
of municipalities or independent fire departments qualifying for the aid, the commissioner
shall calculate the state aid for the municipality or relief association on the basis of the
population and the market value of the area furnished fire protection service by the fire
department as evidenced by duly executed and valid fire service agreements filed with the
commissioner. If one or more fire departments are furnishing contracted fire service to a
city, town, or township, only the population and market value of the area served by each
fire department may be considered in calculating the state aid and the fire departments
furnishing service shall enter into an agreement apportioning among themselves the
percent of the population and the new text begin percent of the new text end market value of each new text begin shared new text end service area.
The agreement must be in writing and must be filed with the commissioner.

(d) The minimum fire state aid allocation amount is the amount in addition to the
initial fire state allocation amount that is derived from any additional funding amount
to support a minimum fire state aid amount under section 423A.02, subdivision 3, and
allocated to municipalities with volunteer firefighters relief associations or covered by the
voluntary statewide lump-sum volunteer firefighter retirement plan based on the number
of active volunteer firefighters who are members of the relief association as reported
in the annual financial reporting for the calendar year 1993 to the Office of the State
Auditor, but not to exceed 30 active volunteer firefighters, so that all municipalities or
fire departments with volunteer firefighters relief associations receive in total at least a
minimum fire state aid amount per 1993 active volunteer firefighter to a maximum of
30 firefighters. If a relief association is established after calendar year 1993 and before
calendar year 2000, the number of active volunteer firefighters who are members of the
relief association as reported in the annual financial reporting for calendar year 1998
to the Office of the State Auditor, but not to exceed 30 active volunteer firefighters,
shall be used in this determination. If a relief association is established after calendar
year 1999, the number of active volunteer firefighters who are members of the relief
association as reported in the first annual financial reporting submitted to the Office of
the State Auditor, but not to exceed 20 active volunteer firefighters, must be used in this
determination. If a relief association is terminated as a result of providing retirement
coverage for volunteer firefighters by the voluntary statewide lump-sum volunteer
firefighter retirement plan under chapter 353G, the number of active volunteer firefighters
of the municipality covered by the statewide plan as certified by the executive director of
the Public Employees Retirement Association to the commissioner and the state auditor,
but not to exceed 30 active firefighters, must be used in this determination.

(e) Unless the firefighters of the applicable fire department are members of the
voluntary statewide lump-sum volunteer firefighter retirement plan, the fire state aid must
be paid to the treasurer of the municipality where the fire department is located and the
treasurer of the municipality shall, within 30 days of receipt of the fire state aid, transmit
the aid to the relief association if the relief association has filed a financial report with the
treasurer of the municipality and has met all other statutory provisions pertaining to the
aid apportionment. If the firefighters of the applicable fire department are members of
the voluntary statewide lump-sum volunteer firefighter retirement plan, the fire state aid
must be paid to the executive director of the Public Employees Retirement Association
and deposited in the voluntary statewide lump-sum volunteer firefighter retirement fund.

(f) The commissioner may make rules to permit the administration of the provisions
of this section.

(g) Any adjustments needed to correct prior misallocations must be made to
subsequent new text begin fire state aid new text end apportionments.

Sec. 15.

Minnesota Statutes 2012, section 69.021, subdivision 7a, is amended to read:

Subd. 7a.

Apportionment of police state aid.

new text begin (a) new text end Subject to the reduction provided
for under subdivision 10, the commissioner shall apportion the police state aid to each
municipality deleted text begin and deleted text end new text begin , new text end to deleted text begin the deleted text end new text begin each new text end county new text begin , to the Department of Natural Resources, and to the
Department of Public Safety new text end in the following manner:

(1) for all municipalities maintaining police departments, counties, the Department
of Natural Resources, and the Department of Public Safety, the police state aid must be
distributed in proportion to the relationship that the total number of peace officers, as
determined under section 69.011, subdivision 1, deleted text begin clause deleted text end new text begin paragraph new text end (g), and subdivision
2, deleted text begin clause deleted text end new text begin paragraph new text end (b), employed by that employing unit for 12 calendar months and
the proportional or fractional number who were employed less than 12 months bears
to the total number of peace officers employed by all municipalities deleted text begin and deleted text end new text begin , new text end counties new text begin , the
Department of Natural Resources, and the Department of Public Safety, new text end subject to any
reduction under subdivision 10;

(2) for each municipality which contracts with the county for police service, a
proportionate amount of the state aid distributed to the county based on the full-time
equivalent number of peace officers providing contract service to that municipality must
be credited against the municipality's contract obligation; and

(3) for each municipality which contracts with another municipality for police
service, a proportionate amount of the state aid distributed to the municipality providing
contract service based on the full-time equivalent number of peace officers providing
contract service to that municipality on a full-time equivalent basis must be credited
against the contract obligation of the municipality receiving contract service.

new text begin (b) Any necessary additional adjustments must be made to subsequent police state
aid apportionments.
new text end

Sec. 16.

Minnesota Statutes 2012, section 69.021, subdivision 8, is amended to read:

Subd. 8.

Population and market value.

(a) In computations relating to fire state aid
requiring the use of population figures, only official statewide federal census figures deleted text begin are
to deleted text end new text begin may new text end be used. Increases or decreases in population disclosed by reason of any special
census must not be taken into consideration.

(b) In calculations relating to fire state aid requiring the use of market value property
figures, only the latest available market value property figures may be used.

Sec. 17.

Minnesota Statutes 2012, section 69.021, subdivision 9, is amended to read:

Subd. 9.

Appeal.

new text begin (a) new text end In the event that a municipality, a county, a fire relief
association, a police relief association, new text begin the Department of Natural Resources, the
Department of Public Safety, new text end or the voluntary statewide lump-sum volunteer firefighter
retirement plan, feels itself to be aggrieved, it may request the commissioner to review
and adjust the apportionment of funds within the county in the case of police state aid, or
within the state in the case of fire state aid.

new text begin (b) new text end The decision of the commissioner is subject to appeal, review, and adjustment
by the district court in the county in which the applicable municipality, fire department,
or police department is located new text begin or by the Ramsey County District Court with respect to
the Department of Natural Resources, the Department of Public Safety, or the voluntary
statewide lump-sum volunteer firefighter retirement plan new text end .

Sec. 18.

Minnesota Statutes 2012, section 69.021, subdivision 10, is amended to read:

Subd. 10.

Reduction in police state aid apportionment.

(a) The commissioner of
revenue shall reduce the apportionment of police state aid under subdivisions 5, paragraph
(b), 6, and 7a, for eligible employer units by new text begin the amount of new text end any excess police state aid.

(b) "Excess police state aid" is:

(1) for counties and for municipalities in which police retirement coverage is
provided wholly by the public employees police and fire fund and all police officers are
members of the plan governed by sections 353.63 to 353.657, the amount in excess of the
employer's total prior calendar year obligation as defined in paragraph (c), as certified by
the executive director of the Public Employees Retirement Association;

deleted text begin (2) for municipalities in which police retirement coverage is provided in part by the
public employees police and fire fund governed by sections 353.63 to 353.657 and in
part by a local police consolidation account governed by chapter 353A, and established
before March 2, 1999, for which the municipality declined merger under section 353.665,
subdivision 1, or established after March 1, 1999, the amount in excess of the employer's
total prior calendar year obligation as defined in paragraph (c), plus the amount of the
employer's total prior calendar year obligation under section 353A.09, subdivision 5,
paragraphs (a) and (b), as certified by the executive director of the Public Employees
Retirement Association;
deleted text end

deleted text begin (3) for municipalities in which police retirement coverage is provided by the public
employees police and fire plan governed by sections 353.63 to 353.657, in which police
retirement coverage was provided by a police consolidation account under chapter
353A before July 1, 1999, and for which the municipality has an additional municipal
contribution under section 353.665, subdivision 8, paragraph (b), the amount in excess of
the employer's total prior calendar year obligation as defined in paragraph (c), plus the
amount of any additional municipal contribution under section 353.665, subdivision 8,
paragraph (b), until the year 2010, as certified by the executive director of the Public
Employees Retirement Association;
deleted text end

deleted text begin (4) deleted text end new text begin (2) new text end for deleted text begin municipalities in which police retirement coverage is provided in part by
the public employees police and fire fund governed by sections 353.63 to 353.657 and in
part by a local police relief association governed by sections 69.77 and 423A.01 deleted text end new text begin the cities
of Fairmont and Minneapolis new text end , the amount in excess of the employer's total prior calendar
year obligation as defined in paragraph (c), as certified by the executive director of the
public employees retirement association, plus the amount of deleted text begin the financial requirements of
the relief association certified to the applicable municipality during the prior calendar year
under section 69.77, subdivisions 4 and 5, reduced by the amount of member contributions
deducted from the covered salary of the relief association during the prior calendar year
under section 69.77, subdivision 3, as certified by the chief administrative officer of the
applicable municipality deleted text end new text begin any additional municipal contribution under section 353.668,
subdivision 6, or 353.669, subdivision 6 new text end ;

deleted text begin (5) deleted text end new text begin (3) new text end for the Metropolitan Airports Commission, the amount in excess of the
commission's total prior calendar year obligation as defined in paragraph (c), as certified
by the executive director of the Public Employees Retirement Association; and

deleted text begin (6) deleted text end new text begin (4) new text end for the Department of Natural Resources and for the Department of Public
Safety, the amount in excess of the employer's total prior calendar year obligation under
section 352B.02, subdivision 1c, for plan members who are peace officers under section
69.011, subdivision 1, clause (g), as certified by the executive director of the Minnesota
State Retirement System.

(c) The employer's total prior calendar year obligation with respect to the public
employees police and fire plan new text begin under paragraph (b), clause (1), new text end is the total prior calendar
year obligation under section 353.65, subdivision 3, for police officers as defined in
section 353.64, subdivision 2, and the actual total prior calendar year obligation under
section 353.65, subdivision 3, for firefighters, as defined in section 353.64, subdivision
3, but not to exceed for those firefighters the applicable following deleted text begin amounts deleted text end new text begin employer
calendar year amount new text end :

	Municipality	Maximum Amount
	Albert Lea	$54,157.01
	Anoka	10,399.31
	Apple Valley	5,442.44
	Austin	49,864.73
	Bemidji	27,671.38
	Brooklyn Center	6,605.92
	Brooklyn Park	24,002.26
	Burnsville	15,956.00
	Cloquet	4,260.49
	Coon Rapids	39,920.00
	Cottage Grove	8,588.48
	Crystal	5,855.00
	East Grand Forks	51,009.88
	Edina	32,251.00
	Elk River	5,216.55
	Ely	13,584.16
	Eveleth	16,288.27
	Fergus Falls	6,742.00
	Fridley	33,420.64
	Golden Valley	11,744.61
	Hastings	16,561.00
	Hopkins	4,324.23
	International Falls	14,400.69
	Lakeville	782.35
	Lino Lakes	5,324.00
	Little Falls	7,889.41
	Maple Grove	6,707.54
	Maplewood	8,476.69
	Minnetonka	10,403.00
	Montevideo	1,307.66
	Moorhead	68,069.26
	New Hope	6,739.72
	North St. Paul	4,241.14
	Northfield	770.63
	Owatonna	37,292.67
	Plymouth	6,754.71
	Red Wing	3,504.01
	Richfield	53,757.96
	Rosemount	1,712.55
	Roseville	9,854.51
	St. Anthony	33,055.00
	St. Louis Park	53,643.11
	Thief River Falls	28,365.04
	Virginia	31,164.46
	Waseca	11,135.17
	West St. Paul	15,707.20
	White Bear Lake	6,521.04
	Woodbury	3,613.00
	any other municipality	0.00

(d) The total amount of excess police state aid must be deposited in the excess
police state-aid account in the general fund, administered and distributed as provided
in subdivision 11.

Sec. 19.

Minnesota Statutes 2012, section 69.021, subdivision 11, is amended to read:

Subd. 11.

Excess police state-aid holding account.

(a) The excess police state-aid
holding account is established in the general fund. The excess police state-aid holding
account must be administered by the commissioner.

(b) Excess police state aid determined according to subdivision 10, must be
deposited new text begin annually new text end in the excess police state-aid holding account.

(c) From the balance in the excess police state-aid holding account, $900,000 must
be canceled annually to the general fund.

deleted text begin (d) If a police officer stress reduction program is created by law and money is
appropriated for that program, an amount equal to that appropriation must be transferred
to the administrator of that program from the balance in the excess police state-aid holding
account.
deleted text end

deleted text begin (e) deleted text end new text begin (d) new text end On October 1 of each year, one-half of the balance of the excess police
state-aid holding account remaining after the deleted text begin deductions deleted text end new text begin deduction new text end under deleted text begin paragraphs
deleted text end new text begin paragraph new text end (c) deleted text begin and (d) deleted text end is appropriated for additional amortization aid under section
423A.02, subdivision 1b.

deleted text begin (f) deleted text end new text begin (e) new text end Annually, the remaining balance in the excess police state-aid holding account,
after the deductions under paragraphs (c) deleted text begin , deleted text end new text begin and new text end (d) deleted text begin , and (e), deleted text end cancels to the general fund.

Sec. 20.

Minnesota Statutes 2012, section 69.031, subdivision 1, is amended to read:

Subdivision 1.

Commissioner's warrant.

(a) The commissioner of management
and budget shall issue to the Public Employees Retirement Association on behalf of
a municipality or independent nonprofit firefighting corporation that is a member of the
voluntary statewide lump-sum volunteer firefighter retirement plan under chapter 353G new text begin ,
to the Department of Natural Resources, to the Department of Public Safety, new text end or to the
county, municipality, or independent nonprofit firefighting corporation certified to the
commissioner of management and budget by the commissioner a warrant for an amount
equal to the amount of fire state aid or police state aid, whichever applies, certified for the
applicable state aid recipient by the commissioner under section 69.021.

(b) new text begin Fire state aid and police state aid is payable on October 1 annually. new text end The amount
of state aid due and not paid by October 1 accrues interest new text begin payable to the state aid recipient
new text end at the rate of one percent for each month or part of a month new text begin that new text end the amount remains
unpaid after October 1.

Sec. 21.

Minnesota Statutes 2012, section 69.031, subdivision 3, is amended to read:

Subd. 3.

Appropriations.

There is hereby appropriated annually from the state
general fund to the commissioner of revenue deleted text begin an amount deleted text end new text begin amounts new text end sufficient to make the
police new text begin state aid payments new text end and new text begin the new text end fire state aid payments specified in this section and
section 69.021.

Sec. 22.

Minnesota Statutes 2012, section 69.031, subdivision 5, is amended to read:

Subd. 5.

Deposit of state aid.

(a) If the municipality or the independent nonprofit
firefighting corporation is covered by the voluntary statewide lump-sum volunteer
firefighter retirement plan under chapter 353G, the executive director shall credit the fire
state aid against future municipal contribution requirements under section 353G.08 and
shall notify the municipality or independent nonprofit firefighting corporation of the fire
state aid so credited at least annually. If the municipality or the independent nonprofit
firefighting corporation is not covered by the voluntary statewide lump-sum volunteer
firefighter retirement plan, the municipal treasurer shall, within 30 days after receipt,
transmit the fire state aid to the treasurer of the duly incorporated firefighters' relief
association if there is one organized and the association has filed a financial report with the
municipality. If the relief association has not filed a financial report with the municipality,
the municipal treasurer shall delay transmission of the fire state aid to the relief association
until the complete financial report is filed. If the municipality or independent nonprofit
firefighting corporation is not covered by the voluntary statewide lump-sum volunteer
firefighter retirement plan, if there is no relief association organized, or if the association
has dissolved or has been removed as trustees of state aid, then the treasurer of the
municipality shall deposit the money in the municipal treasury and the money may be
disbursed only for the purposes and in the manner set forth in section 424A.08 or for the
payment of the employer contribution requirement with respect to firefighters covered by
the public employees police and fire retirement plan under section 353.65, subdivision 3.

deleted text begin (b) The municipal treasurer, upon receipt of the police state aid, shall disburse the
police state aid in the following manner:
deleted text end

deleted text begin (1) For a municipality in which a local police relief association exists and all peace
officers are members of the association, the total state aid must be transmitted to the
treasurer of the relief association within 30 days of the date of receipt, and the treasurer
of the relief association shall immediately deposit the total state aid in the special fund
of the relief association;
deleted text end

deleted text begin (2) deleted text end new text begin (b) new text end For a municipality in which police retirement coverage is provided by the
public employees police and fire fund and all peace officers are members of the fund,
including municipalities covered by section 353.665, the total state aid must be applied
toward the municipality's employer contribution to the public employees police and
fire fund under sections 353.65, subdivision 3, and deleted text begin 353.665 deleted text end new text begin 353.668 new text end , subdivision deleted text begin 8 deleted text end new text begin 6 new text end ,
deleted text begin paragraph (b) deleted text end new text begin or 353.669, subdivision 6 new text end , if applicable deleted text begin ; or deleted text end new text begin .
new text end

deleted text begin (3) For a municipality other than a city of the first class with a population of more
than 300,000 in which both a police relief association exists and police retirement
coverage is provided in part by the public employees police and fire fund, the municipality
may elect at its option to transmit the total state aid to the treasurer of the relief association
as provided in clause (1), to use the total state aid to apply toward the municipality's
employer contribution to the public employees police and fire fund subject to all the
provisions set forth in clause (2), or to allot the total state aid proportionately to be
transmitted to the police relief association as provided in this subdivision and to apply
toward the municipality's employer contribution to the public employees police and fire
fund subject to the provisions of clause (2) on the basis of the respective number of active
full-time peace officers, as defined in section 69.011, subdivision 1, clause (g).
deleted text end

deleted text begin For a city of the first class with a population of more than 300,000, in addition, the
city may elect to allot the appropriate portion of the total police state aid to apply toward
the employer contribution of the city to the public employees police and fire fund based
on the covered salary of police officers covered by the fund each payroll period and to
transmit the balance to the police relief association; or
deleted text end

deleted text begin (4) For a municipality in which police retirement coverage is provided in part by
the public employees police and fire fund and in part by a local police consolidation
account governed by chapter 353A and established before March 2, 1999, for which the
municipality declined merger under section 353.665, subdivision 1, or established after
March 1, 1999, the total police state aid must be applied towards the municipality's total
employer contribution to the public employees police and fire fund and to the local police
consolidation account under sections 353.65, subdivision 3, and 353A.09, subdivision 5.
deleted text end

(c) The county treasurer, upon receipt of the police state aid for the county, shall
apply the total state aid toward the county's employer contribution to the public employees
police and fire fund under section 353.65, subdivision 3.

(d) The designated Metropolitan Airports Commission official, upon receipt of the
police state aid for the Metropolitan Airports Commission, shall apply the total police
state aid toward the commission's employer contribution for police officers to the public
employees police and fire plan under section 353.65, subdivision 3.

(e) The police state aid apportioned to the Departments of Public Safety and Natural
Resources under section 69.021, subdivision 7a, is appropriated to the commissioner of
management and budget for transfer to the funds and accounts from which the salaries of
peace officers certified under section 69.011, subdivision 2b, are paid. The commissioner
of revenue shall certify to the commissioners of public safety, natural resources, and
management and budget the amounts to be transferred from the appropriation for police
state aid. The commissioners of public safety and natural resources shall certify to the
commissioner of management and budget the amounts to be credited to each of the funds
and accounts from which the peace officers employed by their respective departments are
paid. Each commissioner shall allocate the police state aid first for employer contributions
for employees funded from the general fund and then for employer contributions for
employees funded from other funds. For peace officers whose salaries are paid from the
general fund, the amounts transferred from the appropriation for police state aid must
be canceled to the general fund.

Sec. 23.

Minnesota Statutes 2012, section 69.041, is amended to read:

69.041 SHORTFALL FROM GENERAL FUND.

(a) If the annual funding requirements of fire or police relief associations or
consolidation accounts under sections deleted text begin 69.77, deleted text end 69.771 to 69.775, or 353A.09, new text begin or sections
31 to 43, new text end exceed all applicable revenue sources of a given year, including the insurance
premium taxes funding the applicable fire or police state aid as set under section 297I.05,
subdivisions 2, 3, and 4, the shortfall in the annual funding requirements must be paid
from the general fund to the extent appropriated by the legislature.

(b) Nothing in this section may be deemed to relieve any municipality from its
obligation to a relief association or consolidation account under law.

Sec. 24.

Minnesota Statutes 2012, section 69.051, subdivision 1, is amended to read:

Subdivision 1.

Financial report and audit.

(a) The board of deleted text begin each salaried
firefighters deleted text end new text begin the Bloomington Fire Department new text end Relief Association deleted text begin , police relief association,
deleted text end and new text begin each new text end volunteer firefighters relief association as defined in section 424A.001,
subdivision 4, with assets of at least $200,000 or liabilities of at least $200,000 in the prior
year or in any previous year, according to the applicable actuarial valuation or new text begin according
to the new text end financial report if no valuation is required, shall prepare a financial report covering
the special and general funds of the relief association for the preceding fiscal year, file the
financial report, and submit financial statements.

(b) The financial report must contain financial statements and disclosures which
present the true financial condition of the relief association and the results of relief
association operations in conformity with generally accepted accounting principles and in
compliance with the regulatory, financing and funding provisions of this chapter and any
other applicable laws. The financial report must be countersigned by:

(1) the municipal clerk or clerk-treasurer of the municipality in which the relief
association is located if the relief association is a firefighters relief association which is
directly associated with a municipal fire department deleted text begin or is a police relief association deleted text end ; or

(2) by the municipal clerk or clerk-treasurer of the largest municipality in population
which contracts with the independent nonprofit firefighting corporation if the volunteer
firefighter relief association is a subsidiary of an independent nonprofit firefighting
corporation and by the secretary of the independent nonprofit firefighting corporation; or

(3) by the chief financial official of the county in which the volunteer firefighter
relief association is located or primarily located if the relief association is associated with
a fire department that is not located in or associated with an organized municipality.

(c) The financial report must be retained in its office for public inspection and must
be filed with the governing body of the government subdivision in which the associated
fire department is located after the close of the fiscal year. One copy of the financial report
must be furnished to the state auditor after the close of the fiscal year.

(d) Audited financial statements must be attested to by a certified public accountant
or new text begin by new text end the state auditor and must be filed with the state auditor within 180 days after the
close of the fiscal year. The state auditor may accept this report in lieu of the report
required in paragraph (c).

Sec. 25.

Minnesota Statutes 2012, section 69.051, subdivision 1a, is amended to read:

Subd. 1a.

Financial statement.

(a) The board of each volunteer firefighters relief
association, as defined in section 424A.001, subdivision 4, that is not required to file a
financial report and audit under subdivision 1 must prepare a detailed statement of the
financial affairs for the preceding fiscal year of the relief association's special and general
funds in the style and form prescribed by the state auditor. The detailed statement must
show new text begin :
new text end

new text begin (1) new text end the sources and amounts of all money received;

new text begin (2) new text end all disbursements, accounts payable and accounts receivable;

new text begin (3) new text end the amount of money remaining in the treasury;

new text begin (4) new text end total assets new text begin , new text end including a listing of all investments;

new text begin (5) new text end the accrued liabilities; and

new text begin (6) new text end all new text begin other new text end items necessary to show accurately the revenues and expenditures and
financial position of the relief association.

(b) The detailed financial statement required under paragraph (a) must be certified
by an independent public accountant or auditor or by the auditor or accountant who
regularly examines or audits the financial transactions of the municipality. In addition to
certifying the financial condition of the special and general funds of the relief association,
the accountant or auditor conducting the examination shall give an opinion as to the
condition of the special and general funds of the relief association, and shall comment
upon any exceptions to the report. The independent accountant or auditor must have at
least five years of public accounting, auditing, or similar experience, and must not be an
active, inactive, or retired member of the relief association or the fire deleted text begin or police deleted text end department.

(c) The detailed statement required under paragraph (a) must be countersigned by:

(1) the municipal clerk or clerk-treasurer of the municipality; or

(2) where applicable, by the municipal clerk or clerk-treasurer of the largest
municipality in population which contracts with the independent nonprofit firefighting
corporation if the relief association is a subsidiary of an independent nonprofit firefighting
corporation and by the secretary of the independent nonprofit firefighting corporation; or

(3) by the chief financial official of the county in which the volunteer firefighter
relief association is located or primarily located if the relief association is associated with
a fire department that is not located in or associated with an organized municipality.

(d) The volunteer firefighters' relief association board must file the detailed statement
required under paragraph (a) in the relief association office for public inspection and
present it to the deleted text begin city council deleted text end new text begin governing body of the municipality new text end within 45 days after the
close of the fiscal year, and must submit a copy of the detailed statement to the state
auditor within 90 days of the close of the fiscal year.

Sec. 26.

Minnesota Statutes 2012, section 69.051, subdivision 1b, is amended to read:

Subd. 1b.

Qualification.

The state auditor may, upon a demonstration by a relief
association of hardship or new text begin an new text end inability to conform, extend the deadline for reports under
subdivisions 1 or 1a, but not beyond November 30th following the due date. If the
reports are not received by November 30th, the municipality or relief association deleted text begin will
forfeit deleted text end new text begin forfeits new text end its current year state aid, and new text begin , new text end until the state auditor receives the required
information, the relief new text begin association new text end or municipality deleted text begin will be deleted text end new text begin is new text end ineligible to receive any
future state aid. A municipality or deleted text begin police or deleted text end firefighters' relief association deleted text begin shall deleted text end new text begin does new text end not
qualify initially to receive, or be entitled subsequently to retain, state aid deleted text begin pursuant to deleted text end new text begin under
new text end this chapter if the financial reporting requirement or the applicable requirements of this
chapter or any other statute or special law have not been complied with or are not fulfilled.

Sec. 27.

Minnesota Statutes 2012, section 69.051, subdivision 2, is amended to read:

Subd. 2.

Treasurers bond.

deleted text begin No deleted text end new text begin (a) The new text end treasurer of deleted text begin a deleted text end new text begin the Bloomington Fire
Department new text end Relief Association deleted text begin governed by section 69.77 shall deleted text end new text begin may not new text end enter upon duties
without having given the association a bond in a reasonable amount acceptable to the
municipality for the faithful discharge of duties according to law.

new text begin (b) new text end No treasurer of a relief association governed by sections 69.771 to 69.776 deleted text begin shall
deleted text end new text begin may new text end enter upon the duties of the office until the treasurer has given the association a good
and sufficient bond in an amount equal to at least ten percent of the assets of the relief
association; however, the amount of the bond need not exceed $500,000.

Sec. 28.

Minnesota Statutes 2012, section 69.051, subdivision 3, is amended to read:

Subd. 3.

Report by certain municipalities.

(a) new text begin The chief administrative officer
of new text end each municipality which has an organized fire department but which does not have a
firefighters' relief association governed by section 69.77 or sections 69.771 to 69.775 and
which is not exempted under paragraph (b) shall annually prepare a detailed financial
report of the receipts and disbursements by the municipality for fire protection service
during the preceding calendar year deleted text begin , deleted text end on a form prescribed by the state auditor. The financial
report must contain any information which the state auditor deems necessary to disclose
the sources of receipts and the purpose of disbursements for fire protection service.
The financial report must be signed by the municipal clerk or clerk-treasurer of the
municipality. The financial report must be filed by the municipal clerk or clerk-treasurer
with the state auditor on or before July 1 annually. The municipality deleted text begin shall deleted text end new text begin does new text end not qualify
initially to receive, deleted text begin or be deleted text end new text begin and is not new text end entitled subsequently to retain, state aid under this
chapter if the financial reporting requirement or the applicable requirements of this chapter
or any other statute or special law have not been complied with or are not fulfilled.

(b) Each municipality that has an organized fire department and provides retirement
coverage to its firefighters through the voluntary statewide lump-sum volunteer firefighter
retirement plan under chapter 353G qualifies to have fire state aid transmitted to and
retained in the statewide lump-sum volunteer firefighter retirement fund without filing
a detailed financial report if the executive director of the Public Employees Retirement
Association certifies compliance by the municipality with the requirements of sections
353G.04 and 353G.08, paragraph (e), and new text begin certifies conformity new text end by the applicable fire chief
with the requirements of section 353G.07.

Sec. 29.

Minnesota Statutes 2012, section 69.051, subdivision 4, is amended to read:

Subd. 4.

Notification by commissioner and state auditor.

(a) The state auditor new text begin ,
new text end in performing an audit or examination new text begin , new text end shall notify the Legislative Commission on
Pensions and Retirement if the audit or examination reveals malfeasance, misfeasance, or
nonfeasance in office new text begin by relief association officials or municipal officials new text end .

(b) The commissioner shall notify the Legislative Commission on Pensions and
Retirement if the state auditor has not filed the required financial compliance reports
by July 1.

Sec. 30.

Minnesota Statutes 2012, section 69.33, is amended to read:

69.33 REPORT; AMOUNT OF PREMIUMS RECEIVED BY INSURANCE
COMPANIES.

new text begin For purposes of the first class city fire insurance premium tax surcharge aid program
under section 297I.10, new text end the commissioner shall enclose in the annual statement blank that is
sent to all fire insurance companies doing business in this state a blank form containing
the names of all cities of the first class and require these companies, at the time of making
their annual statements to the commissioner, to state on these blanks the amount of
premiums received by them upon properties insured within the corporate limits of the
cities named thereon during the year ending December 31st last past. Thereafter, before
July first each year, the commissioner shall certify to the commissioner of management
and budget the information thus obtained, together with the amount of the tax for the
benefit of the pension plans covering firefighters in cities of the first class paid in such
year by these companies upon these insurance premiums.

Sec. 31.

Minnesota Statutes 2012, section 69.77, subdivision 1, is amended to read:

Subdivision 1.

Conditioned employer support for deleted text begin a deleted text end new text begin the Bloomington Fire
Department new text end Relief Association.

(a) Notwithstanding any law to the contrary, only
if the deleted text begin municipality deleted text end new text begin city of Bloomington new text end and the new text begin Bloomington Fire Department new text end Relief
Association comply with the provisions of this section, deleted text begin a municipality deleted text end new text begin the city of
Bloomington new text end may contribute public funds, including any applicable police or fire state
aid, or levy property taxes for the support of deleted text begin a police or firefighters' deleted text end new text begin the Bloomington
Fire Department new text end Relief Association deleted text begin , enumerated in subdivision 1a, however organized,
which provides retirement coverage or pays a service pension to a retired police officer or
firefighter or a retirement benefit to a surviving dependent of either an active or retired
police officer or firefighter, deleted text end new text begin and new text end for the operation and maintenance of the relief association.

(b) The commissioner shall not include in the apportionment of deleted text begin police or deleted text end fire state
aid deleted text begin to the county auditor under section 69.021, subdivision 6, any municipality in which
there exists a local police or salaried firefighters' relief association as enumerated in
subdivision 1a which deleted text end new text begin the city of Bloomington if the Bloomington Fire Department Relief
Association new text end does not comply with the provisions of this section or the provisions of any
applicable special law relating to the funding or financing of the association and deleted text begin that
municipality deleted text end new text begin the city of Bloomington new text end may not qualify initially to receive, or be entitled
subsequently to retain, new text begin fire new text end state aid under sections 69.011 to 69.051 until the reason
for the disqualification is remedied, whereupon the deleted text begin municipality deleted text end new text begin city of Bloomington new text end ,
if otherwise qualified, is entitled to again receive new text begin fire new text end state aid for the year occurring
immediately subsequent to the year in which the disqualification is remedied.

(c) The state auditor and the commissioner shall determine if deleted text begin a municipality with a
local police or salaried firefighters' relief association fails deleted text end new text begin the city of Bloomington and the
Bloomington Fire Department Relief Association fail new text end to comply with the provisions of
this section or the funding or financing provisions of any applicable special law.

Sec. 32.

Minnesota Statutes 2012, section 69.77, subdivision 2, is amended to read:

Subd. 2.

Inapplicable penalty.

The penalty provided for in subdivision 1 does not
apply to deleted text begin a deleted text end new text begin the Bloomington Fire Department new text end Relief Association deleted text begin enumerated in subdivision
1a deleted text end if the requirements of subdivisions 3 to 10 are met.

Sec. 33.

Minnesota Statutes 2012, section 69.77, subdivision 3, is amended to read:

Subd. 3.

Minimum member contribution.

new text begin (a) new text end Each active new text begin full-time new text end member of
the new text begin Bloomington Fire Department new text end Relief Association must pay into the special fund of
the association during a year of covered service, a contribution for retirement coverage,
including survivorship benefits, of not less than eight percent of the maximum rate of
salary upon which retirement coverage is credited and service pension and retirement
benefit amounts are determined. The member contributions must be made by payroll
deduction from the salary of the member by the deleted text begin municipality deleted text end new text begin city of Bloomington new text end , and
must be transmitted by the deleted text begin municipality deleted text end new text begin city of Bloomington new text end to the relief association as
soon as practical. The relief association shall deposit the member contribution to the credit
of the special fund of the relief association.

new text begin (b) new text end The member contribution requirement specified in this subdivision does not
apply to any members who are volunteer firefighters new text begin or who are not employed full time
as firefighters new text end .

Sec. 34.

Minnesota Statutes 2012, section 69.77, subdivision 4, is amended to read:

Subd. 4.

Relief association financial requirements; minimum municipal
obligation.

(a) The officers of the new text begin Bloomington Fire Department new text end Relief Association
shall determine the financial requirements of the relief association and new text begin the new text end minimum
obligation of the deleted text begin municipality deleted text end new text begin city of Bloomington new text end for the following calendar year in
accordance with the requirements of this subdivision. The financial requirements of the
relief association and the minimum obligation of the deleted text begin municipality deleted text end new text begin city of Bloomington
new text end must be determined on or before the submission date established by the deleted text begin municipality
deleted text end new text begin city of Bloomington new text end under subdivision 5.

(b) The financial requirements of the relief association for the following calendar
year must be based on the most recent actuarial valuation or survey of the special fund of
the association if more than one fund is maintained by the association, or of the association,
if only one fund is maintained, prepared in accordance with sections 356.215, subdivisions
4 to 15, and 356.216, as required under subdivision 10. If an actuarial estimate is prepared
by the actuary of the relief association as part of obtaining a modification of the benefit
plan of the relief association and the modification is implemented, the actuarial estimate
must be used in calculating the subsequent financial requirements of the relief association.

(c) If the relief association has an unfunded actuarial accrued liability as reported in
the most recent actuarial valuation or survey, the total of the amounts calculated under
clauses (1), (2), and (3), constitute the financial requirements of the relief association for
the following year. If the relief association does not have an unfunded actuarial accrued
liability as reported in the most recent actuarial valuation or survey, the amount calculated
under clauses (1) and (2) constitute the financial requirements of the relief association for
the following year. The financial requirement elements are:

(1) the normal level cost requirement for the following year, expressed as a dollar
amount, which must be determined by applying the normal level cost of the relief
association as reported in the actuarial valuation or survey and expressed as a percentage
of covered payroll to the estimated covered payroll of the active membership of the relief
association, including any projected change in the active membership, for the following
year;

(2) deleted text begin for the Bloomington Fire Department Relief Association, deleted text end to the dollar amount
of normal cost determined under clause (1) must be added an amount equal to the dollar
amount of the administrative expenses of the special fund of the association if more
than one fund is maintained by the association, or of the association if only one fund is
maintained, for the most recent year, multiplied by the factor of 1.035. The administrative
expenses are those authorized under section 69.80; and

(3) to the dollar amount of normal cost and expenses determined under clauses
(1) and (2) must be added an amount equal to the level annual dollar amount which
is sufficient to amortize the unfunded actuarial accrued liability as determined from
the actuarial valuation or survey of the fund, using an interest assumption set at the
applicable rate specified in section 356.215, subdivision 8, by that fund's amortization
date as specified in paragraph (d).

deleted text begin (d) deleted text end The deleted text begin Bloomington Fire Department Relief Association deleted text end special fund amortization
date is determined under section 356.216, clause (2). The amortization date specified in
this paragraph supersedes any amortization date specified in any applicable special law.

new text begin (d) If the actuarial value of the assets of the special fund of the relief association
exceed the actuarial accrued liability as reported in the most recent actuarial valuation of the
special fund of the relief association, the financial requirements of the relief association are
the amounts calculated under paragraph (c), clauses (1) and (2), reduced by one-tenth of the
amount by which the actuarial value of the assets of the special fund of the relief association
exceeds the actuarial accrued liability of the special fund of the relief association.
new text end

(e) The minimum obligation of the municipality is an amount equal to the financial
requirements of the relief association reduced by the estimated amount of member
contributions from covered salary anticipated for the following calendar year and the
estimated deleted text begin amounts deleted text end new text begin amount new text end anticipated for the following calendar year from the deleted text begin applicable
deleted text end new text begin fire new text end state aid program established under sections 69.011 to 69.051 receivable by the relief
association after any allocation made under section 69.031, subdivision 5, paragraph (b),
clause (2) deleted text begin , or 423A.01, subdivision 2, paragraph (a), clause (6), from the local police
and salaried firefighters' relief association amortization aid program established under
section 423A.02, subdivision 1, from the supplementary amortization state-aid program
established under section 423A.02, subdivision 1a, and from the additional amortization
state aid under section 423A.02, subdivision 1b deleted text end .

Sec. 35.

Minnesota Statutes 2012, section 69.77, subdivision 5, is amended to read:

Subd. 5.

Determination submission.

The officers of the relief association shall
submit the determination of the financial requirements of the relief association and of the
minimum obligation of the municipality to the deleted text begin governing body deleted text end new text begin Bloomington City Council
new text end on or before the date established by the deleted text begin municipality deleted text end new text begin city of Bloomington new text end , which may
not be earlier than August 1 and may not be later than September 1 of each year. The
deleted text begin governing body of the municipality deleted text end new text begin Bloomington City Council new text end must ascertain whether or
not the determinations were prepared in accordance with law.

Sec. 36.

Minnesota Statutes 2012, section 69.77, subdivision 6, is amended to read:

Subd. 6.

Municipal payment.

(a) The deleted text begin municipality deleted text end new text begin city of Bloomington new text end shall
provide for and shall pay, each year, at least the amount of the minimum obligation of the
deleted text begin municipality deleted text end new text begin city of Bloomington new text end to the new text begin Bloomington Fire Department new text end Relief Association.

(b) If there is any deficiency in the municipal payment to meet the minimum
obligation of the deleted text begin municipality deleted text end new text begin city of Bloomington new text end as of the end of any calendar year, the
amount of the deficiency must be added to the minimum obligation of the deleted text begin municipality deleted text end new text begin city
of Bloomington new text end for the following year calculated under subdivision 4 and must include
interest at the compound rate of six percent per annum from the date that the deleted text begin municipality
deleted text end new text begin city of Bloomington new text end was required to make payment under this subdivision until the date
that the deleted text begin municipality deleted text end new text begin city of Bloomington new text end actually makes the required payment.

Sec. 37.

Minnesota Statutes 2012, section 69.77, subdivision 7, is amended to read:

Subd. 7.

Budget inclusion.

(a) The deleted text begin municipality deleted text end new text begin city of Bloomington new text end shall provide
in the annual municipal budget for at least the minimum obligation of the municipality
calculated under subdivision 4.

(b) The deleted text begin municipality deleted text end new text begin city of Bloomington new text end may levy taxes for the payment of the
minimum obligation of the deleted text begin municipality deleted text end new text begin city of Bloomington new text end without any limitation as to
rate or amount and irrespective of limitations imposed by other provisions of law upon the
rate or amount of taxation when the balance of the special fund or any fund of the relief
association has attained a specified minimum asset level. In addition, any taxes levied
under this section may not cause the amount or rate of other taxes levied in that year or to
be levied in a subsequent year by the deleted text begin municipality deleted text end new text begin city of Bloomington new text end which are subject
to a limitation as to rate or amount to be reduced.

(c) If the deleted text begin municipality deleted text end new text begin city of Bloomington new text end does not include the full amount of
the minimum obligation of the deleted text begin municipality deleted text end new text begin city of Bloomington new text end in the levy that the
deleted text begin municipality deleted text end new text begin city of Bloomington new text end certified to the new text begin Hennepin new text end County auditor in any year, the
officers of the relief association shall certify the amount of any deficiency to the new text begin Hennepin
new text end County auditor. Upon verifying the existence of any deficiency in the levy certified by
the deleted text begin municipality deleted text end new text begin city of Bloomington new text end , the new text begin Hennepin new text end County auditor shall spread a levy
over the taxable property of the deleted text begin municipality deleted text end new text begin city of Bloomington new text end in the amount of the
deficiency certified to by the officers of the relief association.

Sec. 38.

Minnesota Statutes 2012, section 69.77, subdivision 8, is amended to read:

Subd. 8.

Accelerated amortization.

Any sums of money paid by the deleted text begin municipality
deleted text end new text begin city of Bloomington new text end to the relief association in excess of the minimum obligation of the
deleted text begin municipality deleted text end new text begin city of Bloomington new text end in any year must be used to amortize any unfunded
actuarial accrued liabilities of the new text begin Bloomington Fire Department new text end Relief Association.

Sec. 39.

Minnesota Statutes 2012, section 69.77, subdivision 9, is amended to read:

Subd. 9.

Local paid fire relief association investment authority.

(a) The deleted text begin special
fund deleted text end new text begin funds new text end of the association must be invested in securities that are authorized investments
under section 356A.06, subdivision 6 or 7, whichever applies.

(b) The governing board of the new text begin Bloomington Fire Department Relief new text end Association
may select and appoint a qualified private firm to measure management performance and
return on investment, and the firm must use the formula or formulas developed by the
State Board new text begin of Investment new text end under section 11A.04, clause (11). new text begin The governing board of the
Bloomington Fire Department Relief Association may certify general fund assets of the
relief association for investment by the State Board of Investment in fixed income pools
or in a separately managed account at the discretion of the State Board of Investment
as provided in section 11A.14.
new text end

deleted text begin (c) The governing board of the association may certify general fund assets of the
relief association for investment by the State Board of Investment in fixed income pools
or in a separately managed account at the discretion of the State Board of Investment
as provided in section 11A.14.
deleted text end

Sec. 40.

Minnesota Statutes 2012, section 69.77, subdivision 10, is amended to read:

Subd. 10.

Actuarial valuation required.

The new text begin governing board of the Bloomington
Fire Department Relief new text end Association shall obtain an actuarial valuation showing the
condition of the special fund of the relief association under sections 356.215 and 356.216
and deleted text begin any deleted text end new text begin the new text end applicable standards for actuarial work established by the Legislative
Commission on Pensions and Retirement. The actuarial valuation must be made as of
December 31 of every year. A copy of the actuarial valuation must be filed with the
Director of the Legislative Reference Library, the deleted text begin governing body of the municipality in
which the association is organized deleted text end new text begin Bloomington City Council new text end , the executive director of
the Legislative Commission on Pensions and Retirement, and the state auditor, not later
than July 1 of the following year.

Sec. 41.

Minnesota Statutes 2012, section 69.77, subdivision 11, is amended to read:

Subd. 11.

Municipal approval of benefit changes required.

Any amendment to
the bylaws or articles of incorporation of deleted text begin a deleted text end new text begin the Bloomington Fire Department new text end Relief
Association which increases or otherwise affects the retirement coverage provided by or
the service pensions or retirement benefits payable from deleted text begin any police or firefighters' deleted text end new text begin the
new text end relief association deleted text begin enumerated in subdivision 1a deleted text end is not effective until it is ratified by the
deleted text begin municipality in which the relief association is located deleted text end new text begin city of Bloomington new text end . The officers
of the relief association shall not seek municipal ratification before obtaining either an
updated actuarial valuation including the proposed amendment or an estimate of the
expected actuarial impact of the proposed amendment prepared by the actuary of the relief
association and submitting that actuarial valuation or estimate to the new text begin Bloomington city
new text end clerk deleted text begin of the municipality deleted text end .

Sec. 42.

Minnesota Statutes 2012, section 69.77, subdivision 12, is amended to read:

Subd. 12.

Application of other laws to contribution rate.

In the absence of any
specific provision to the contrary, no general or special law previously enacted may be
construed as reducing the levy amount deleted text begin or rate of contribution deleted text end to deleted text begin a police or firefighters deleted text end new text begin the
Bloomington Fire Department new text end Relief Association to which subdivision 1a applies, by deleted text begin a
municipality or member of the association deleted text end new text begin the city of Bloomington new text end , which is required as a
condition for the use of public funds or the levy of taxes for the support of the association.
deleted text begin Each deleted text end new text begin The Bloomington Fire Department Relief new text end Association, the deleted text begin municipality in which
it is organized deleted text end new text begin city of Bloomington new text end , and the officers of each, are authorized to do all
things required by this section as a condition for the use of public funds or the levy of
taxes for the support of the association.

Sec. 43.

Minnesota Statutes 2012, section 69.77, subdivision 13, is amended to read:

Subd. 13.

Citation.

This section may be cited as the " deleted text begin Police and Firefighters'
deleted text end new text begin Bloomington Fire Department new text end Relief deleted text begin Associations deleted text end new text begin Association new text end Guidelines Act deleted text begin of 1969 deleted text end ."

Sec. 44.

Minnesota Statutes 2012, section 69.771, subdivision 1, is amended to read:

Subdivision 1.

Covered relief associations.

The applicable provisions of sections
69.771 to 69.776 apply to any firefighters' relief association other than deleted text begin a deleted text end new text begin the Bloomington
Fire Department new text end Relief Association deleted text begin enumerated in section 69.77, subdivision 1a, deleted text end which
is organized under any laws of this state, which is composed of volunteer firefighters or
is composed partially of volunteer firefighters and partially of salaried firefighters with
retirement coverage provided by the public employees police and fire fund and which, in
either case, operates subject to the service pension minimum requirements for entitlement
and maximums contained in section 424A.02, or subject to a special law modifying those
requirements or maximums.

Sec. 45.

Minnesota Statutes 2012, section 69.80, is amended to read:

69.80 AUTHORIZED ADMINISTRATIVE EXPENSES.

(a) Notwithstanding any provision of law to the contrary, the payment of the
following necessary, reasonable and direct expenses of maintaining, protecting and
administering the special fund, when provided for in the bylaws of the association and
approved by the board of trustees, constitutes authorized administrative expenses of a
deleted text begin police, salaried firefighters', or deleted text end volunteer firefighters' relief association organized under
any law of this state new text begin or the Bloomington Fire Department Relief Association new text end :

(1) office expense, including, but not limited to, rent, utilities, equipment, supplies,
postage, periodical subscriptions, furniture, fixtures, and salaries of administrative
personnel;

(2) salaries of the officers of the association, or their designees, and salaries of the
members of the board of trustees of the association if the salary amounts are approved by
the governing body of the entity that is responsible for meeting any minimum obligation
under section deleted text begin 69.77, deleted text end 69.772 deleted text begin , deleted text end or 69.773, new text begin or sections 31 to 43, new text end and the itemized expenses
of relief association officers and board members that are incurred as a result of fulfilling
their responsibilities as administrators of the special fund;

(3) tuition, registration fees, organizational dues, and other authorized expenses
of the officers or members of the board of trustees incurred in attending educational
conferences, seminars, or classes relating to the administration of the relief association;

(4) audit, actuarial, medical, legal, and investment and performance evaluation
expenses;

(5) filing and application fees payable by the relief association to federal or other
governmental entities;

(6) reimbursement to the officers and members of the board of trustees, or their
designees, for reasonable and necessary expenses actually paid and incurred in the
performance of their duties as officers or members of the board; and

(7) premiums on fiduciary liability insurance and official bonds for the officers,
members of the board of trustees, and employees of the relief association.

(b) Any other expenses of the relief association must be paid from the general fund
of the association, if one exists. If a relief association has only one fund, that fund is the
special fund for purposes of this section. If a relief association has a special fund and
a general fund, and any expense of the relief association that is directly related to the
purposes for which both funds were established, the payment of that expense must be
apportioned between the two funds on the basis of the benefits derived by each fund.

Sec. 46.

Minnesota Statutes 2012, section 275.70, subdivision 5, is amended to read:

Subd. 5.

Special levies.

"Special levies" means those portions of ad valorem taxes
levied by a local governmental unit for the following purposes or in the following manner:

(1) to pay the costs of the principal and interest on bonded indebtedness or to
reimburse for the amount of liquor store revenues used to pay the principal and interest
due on municipal liquor store bonds in the year preceding the year for which the levy
limit is calculated;

(2) to pay the costs of principal and interest on certificates of indebtedness issued for
any corporate purpose except for the following:

(i) tax anticipation or aid anticipation certificates of indebtedness;

(ii) certificates of indebtedness issued under sections 298.28 and 298.282;

(iii) certificates of indebtedness used to fund current expenses or to pay the costs of
extraordinary expenditures that result from a public emergency; or

(iv) certificates of indebtedness used to fund an insufficiency in tax receipts or an
insufficiency in other revenue sources, provided that nothing in this subdivision limits the
special levy authorized under section 475.755;

(3) to provide for the bonded indebtedness portion of payments made to another
political subdivision of the state of Minnesota;

(4) to fund payments made to the Minnesota State Armory Building Commission
under section 193.145, subdivision 2, to retire the principal and interest on armory
construction bonds;

(5) property taxes approved by voters which are levied against the referendum
market value as provided under section 275.61;

(6) to fund matching requirements needed to qualify for federal or state grants or
programs to the extent that either (i) the matching requirement exceeds the matching
requirement in calendar year 2001, or (ii) it is a new matching requirement that did not
exist prior to 2002;

(7) to pay the expenses reasonably and necessarily incurred in preparing for or
repairing the effects of natural disaster including the occurrence or threat of widespread
or severe damage, injury, or loss of life or property resulting from natural causes, in
accordance with standards formulated by the Emergency Services Division of the state
Department of Public Safety, as allowed by the commissioner of revenue under section
275.74, subdivision 2;

(8) pay amounts required to correct an error in the levy certified to the county
auditor by a city or county in a levy year, but only to the extent that when added to the
preceding year's levy it is not in excess of an applicable statutory, special law or charter
limitation, or the limitation imposed on the governmental subdivision by sections 275.70
to 275.74 in the preceding levy year;

(9) to pay an abatement under section 469.1815;

(10) to pay any costs attributable to increases in the employer contribution rates under
chapter 353, or locally administered pension plans, that are effective after June 30, 2001;

(11) to pay the operating or maintenance costs of a county jail as authorized in section
641.01 or 641.262, or of a correctional facility as defined in section 241.021, subdivision 1,
paragraph (f), to the extent that the county can demonstrate to the commissioner of revenue
that the amount has been included in the county budget as a direct result of a rule, minimum
requirement, minimum standard, or directive of the Department of Corrections, or to pay
the operating or maintenance costs of a regional jail as authorized in section 641.262. For
purposes of this clause, a district court order is not a rule, minimum requirement, minimum
standard, or directive of the Department of Corrections. If the county utilizes this special
levy, except to pay operating or maintenance costs of a new regional jail facility under
sections 641.262 to 641.264 which will not replace an existing jail facility, any amount
levied by the county in the previous levy year for the purposes specified under this clause
and included in the county's previous year's levy limitation computed under section
275.71, shall be deducted from the levy limit base under section 275.71, subdivision 2,
when determining the county's current year levy limitation. The county shall provide the
necessary information to the commissioner of revenue for making this determination;

(12) to pay for operation of a lake improvement district, as authorized under section
103B.555. If the county utilizes this special levy, any amount levied by the county in the
previous levy year for the purposes specified under this clause and included in the county's
previous year's levy limitation computed under section 275.71 shall be deducted from
the levy limit base under section 275.71, subdivision 2, when determining the county's
current year levy limitation. The county shall provide the necessary information to the
commissioner of revenue for making this determination;

(13) to repay a state or federal loan used to fund the direct or indirect required
spending by the local government due to a state or federal transportation project or other
state or federal capital project. This authority may only be used if the project is not a
local government initiative;

(14) to pay for court administration costs as required under section 273.1398,
subdivision 4b, less the (i) county's share of transferred fines and fees collected by the
district courts in the county for calendar year 2001 and (ii) the aid amount certified to be
paid to the county in 2004 under section 273.1398, subdivision 4c; however, for taxes
levied to pay for these costs in the year in which the court financing is transferred to the
state, the amount under this clause is limited to the amount of aid the county is certified to
receive under section 273.1398, subdivision 4a;

(15) to fund a deleted text begin police or deleted text end firefighters relief association as required under deleted text begin section
69.77 deleted text end new text begin sections 31 to 43 new text end to the extent that the required amount exceeds the amount levied
for this purpose in 2001;

(16) for purposes of a storm sewer improvement district under section 444.20;

(17) to pay for the maintenance and support of a city or county society for the
prevention of cruelty to animals under section 343.11, but not to exceed in any year
$4,800 or the sum of $1 per capita based on the county's or city's population as of the most
recent federal census, whichever is greater. If the city or county uses this special levy, any
amount levied by the city or county in the previous levy year for the purposes specified
in this clause and included in the city's or county's previous year's levy limit computed
under section 275.71, must be deducted from the levy limit base under section 275.71,
subdivision 2, in determining the city's or county's current year levy limit;

(18) for counties, to pay for the increase in their share of health and human service
costs caused by reductions in federal health and human services grants effective after
September 30, 2007;

(19) for a city, for the costs reasonably and necessarily incurred for securing,
maintaining, or demolishing foreclosed or abandoned residential properties, as allowed by
the commissioner of revenue under section 275.74, subdivision 2. A city must have either
(i) a foreclosure rate of at least 1.4 percent in 2007, or (ii) a foreclosure rate in 2007 in
the city or in a zip code area of the city that is at least 50 percent higher than the average
foreclosure rate in the metropolitan area, as defined in section 473.121, subdivision 2,
to use this special levy. For purposes of this paragraph, "foreclosure rate" means the
number of foreclosures, as indicated by sheriff sales records, divided by the number of
households in the city in 2007;

(20) for a city, for the unreimbursed costs of redeployed traffic-control agents and
lost traffic citation revenue due to the collapse of the Interstate 35W bridge, as certified
to the Federal Highway Administration;

(21) to pay costs attributable to wages and benefits for sheriff, police, and fire
personnel. If a local governmental unit did not use this special levy in the previous year its
levy limit base under section 275.71 shall be reduced by the amount equal to the amount it
levied for the purposes specified in this clause in the previous year;

(22) an amount equal to any reductions in the certified aids or credit reimbursements
payable under sections 477A.011 to 477A.014, and section 273.1384, due to unallotment
under section 16A.152 or reductions under another provision of law. The amount of the
levy allowed under this clause for each year is limited to the amount unallotted or reduced
from the aids and credit reimbursements certified for payment in the year following the
calendar year in which the tax levy is certified unless the unallotment or reduction amount
is not known by September 1 of the levy certification year, and the local government has
not adjusted its levy under section 275.065, subdivision 6, or 275.07, subdivision 6, in
which case that unallotment or reduction amount may be levied in the following year;

(23) to pay for the difference between one-half of the costs of confining sex offenders
undergoing the civil commitment process and any state payments for this purpose pursuant
to section 253B.185, subdivision 5;

(24) for a county to pay the costs of the first year of maintaining and operating a new
facility or new expansion, either of which contains courts, corrections, dispatch, criminal
investigation labs, or other public safety facilities and for which all or a portion of the
funding for the site acquisition, building design, site preparation, construction, and related
equipment was issued or authorized prior to the imposition of levy limits in 2008. The
levy limit base shall then be increased by an amount equal to the new facility's first full
year's operating costs as described in this clause; and

(25) for the estimated amount of reduction to market value credit reimbursements
under section 273.1384 for credits payable in the year in which the levy is payable.

Sec. 47.

Minnesota Statutes 2012, section 297I.10, subdivision 1, is amended to read:

Subdivision 1.

Cities of the first class.

(a) The commissioner shall order and direct
a surcharge to be collected of two percent of the fire, lightning, and sprinkler leakage gross
premiums, less return premiums, on all direct business received by any licensed foreign or
domestic fire insurance company on property in a city of the first class, or by its agents for
it, in cash or otherwise.

(b) By July 31 and December 31 of each year new text begin , new text end the commissioner of management
and budget shall pay to deleted text begin the relief association in deleted text end each city new text begin of the first class new text end a warrant for
an amount equal to the total amount of the surcharge on the premiums collected within
deleted text begin the deleted text end new text begin that new text end city since the previous payment.

(c) The treasurer of the deleted text begin relief association deleted text end new text begin city new text end shall place the money received under
this subdivision in deleted text begin the deleted text end new text begin a new text end special new text begin account or new text end fund deleted text begin of the relief association deleted text end new text begin to defray all or a
a portion of the employer contribution requirement of public employees police and fire
plan coverage for city firefighters new text end .

Sec. 48.

Minnesota Statutes 2012, section 345.381, is amended to read:

345.381 PROPERTY HELD BY MINNESOTA PUBLIC PENSION FUND.

No amounts of money held or owing by a public pension fund enumerated in section
356.20, subdivision 2, or 356.30, subdivision 3, or governed by sections deleted text begin 69.77 or deleted text end 69.771 to
69.776 deleted text begin shall deleted text end new text begin or sections 31 to 43 may new text end be presumed to have been abandoned for purposes of
sections 345.41, 345.42, 345.43, 345.47 and 345.48 if the plan governing the public pension
fund includes a provision governing the disposition of unclaimed amounts of money.

Sec. 49.

Minnesota Statutes 2012, section 353.01, subdivision 2a, is amended to read:

Subd. 2a.

Included employees; mandatory membership.

(a) Public employees
whose salary exceeds $425 in any month and who are not specifically excluded under
subdivision 2b or who have not been provided an option to participate under subdivision
2d, whether individually or by action of the governmental subdivision, must participate as
members of the association with retirement coverage by the general employees retirement
plan under this chapter, the public employees police and fire retirement plan under this
chapter, or the local government correctional employees retirement plan under chapter
353E, whichever applies. Membership commences as a condition of their employment on
the first day of their employment or on the first day that the eligibility criteria are met,
whichever is later. Public employees include but are not limited to:

(1) persons whose salary meets the threshold in this paragraph from employment in
one or more positions within one governmental subdivision;

(2) elected county sheriffs;

(3) persons who are appointed, employed, or contracted to perform governmental
functions that by law or local ordinance are required of a public officer, including, but
not limited to:

(i) town and city clerk or treasurer;

(ii) county auditor, treasurer, or recorder;

(iii) city manager as defined in section 353.028 who does not exercise the option
provided under subdivision 2d; or

(iv) emergency management director, as provided under section 12.25;

(4) physicians under section 353D.01, subdivision 2, who do not elect public
employees defined contribution plan coverage under section 353D.02, subdivision 2;

(5) full-time employees of the Dakota County Agricultural Society;

deleted text begin (6) employees of the Minneapolis Firefighters Relief Association or Minneapolis
Police Relief Association who are not excluded employees under subdivision 2b due
to coverage by the relief association pension plan and who elected general employee
retirement plan coverage before August 20, 2009;
deleted text end

deleted text begin (7) deleted text end new text begin (6) new text end employees of the Red Wing Port Authority who were first employed by the
Red Wing Port Authority before May 1, 2011, and who are not excluded employees
under subdivision 2b; and

deleted text begin (8) deleted text end new text begin (7) new text end employees of the Seaway Port Authority of Duluth who are not excluded
employees under subdivision 2b.

(b) A public employee or elected official who was a member of the association on
June 30, 2002, based on employment that qualified for membership coverage by the public
employees retirement plan or the public employees police and fire plan under this chapter,
or the local government correctional employees retirement plan under chapter 353E as of
June 30, 2002, retains that membership for the duration of the person's employment in that
position or incumbency in elected office. Except as provided in subdivision 28, the person
shall participate as a member until the employee or elected official terminates public
employment under subdivision 11a or terminates membership under subdivision 11b.

(c) If the salary of an included public employee is less than $425 in any subsequent
month, the member retains membership eligibility.

(d) For the purpose of participation in the MERF division of the general employees
retirement plan, public employees include employees who were members of the former
Minneapolis Employees Retirement Fund on June 29, 2010, and who participate as
members of the MERF division of the association.

Sec. 50.

Minnesota Statutes 2012, section 353.01, subdivision 2b, is amended to read:

Subd. 2b.

Excluded employees.

(a) The following public employees are not eligible
to participate as members of the association with retirement coverage by the general
employees retirement plan, the local government correctional employees retirement plan
under chapter 353E, or the public employees police and fire retirement plan:

(1) persons whose salary from one governmental subdivision never exceeds $425 in
a month;

(2) public officers who are elected to a governing body, city mayors, or persons who
are appointed to fill a vacancy in an elective office of a governing body, whose term of office
commences on or after July 1, 2002, for the service to be rendered in that elective position;

(3) election officers or election judges;

(4) patient and inmate personnel who perform services for a governmental
subdivision;

(5) except as otherwise specified in subdivision 12a, employees who are hired for
a temporary position as defined under subdivision 12a, and employees who resign from
a nontemporary position and accept a temporary position within 30 days in the same
governmental subdivision;

(6) employees who are employed by reason of work emergency caused by fire,
flood, storm, or similar disaster;

(7) employees who by virtue of their employment in one governmental subdivision
are required by law to be a member of and to contribute to any of the plans or funds
administered by the Minnesota State Retirement System, the Teachers Retirement
Association, the Duluth Teachers Retirement Fund Association, new text begin and new text end the St. Paul Teachers
Retirement Fund Association deleted text begin , or any police or firefighters relief association governed by
section 69.77 that has not consolidated with the Public Employees Retirement Association,
or any local police or firefighters consolidation account who have not elected the type of
benefit coverage provided by the public employees police and fire fund under sections
353A.01 to 353A.10, or any persons covered by section 353.665, subdivision 4, 5, or 6,
who have not elected public employees police and fire plan benefit coverage deleted text end . This clause
must not be construed to prevent a person from being a member of and contributing to
the Public Employees Retirement Association and also belonging to and contributing to
another public pension plan or fund for other service occurring during the same period
of time. A person who meets the definition of "public employee" in subdivision 2 by
virtue of other service occurring during the same period of time becomes a member of the
association unless contributions are made to another public retirement fund on the salary
based on the other service or to the Teachers Retirement Association by a teacher as
defined in section 354.05, subdivision 2;

(8) persons who are members of a religious order and are excluded from coverage
under the federal Old Age, Survivors, Disability, and Health Insurance Program for the
performance of service as specified in United States Code, title 42, section 410(a)(8)(A),
as amended through January 1, 1987, if no irrevocable election of coverage has been made
under section 3121(r) of the Internal Revenue Code of 1954, as amended;

(9) employees of a governmental subdivision who have not reached the age of
23 and are enrolled on a full-time basis to attend or are attending classes on a full-time
basis at an accredited school, college, or university in an undergraduate, graduate, or
professional-technical program, or a public or charter high school;

(10) resident physicians, medical interns, and pharmacist residents and pharmacist
interns who are serving in a degree or residency program in public hospitals or clinics;

(11) students who are serving in an internship or residency program sponsored
by an accredited educational institution;

(12) persons who hold a part-time adult supplementary technical college license who
render part-time teaching service in a technical college;

(13) except for employees of Hennepin County or Hennepin Healthcare System, Inc.,
foreign citizens who are employed by a governmental subdivision under a work permit, or
an H-1b visa initially issued or extended for a combined period less than three years of
employment. Upon extension of the employment beyond the three-year period, the foreign
citizens must be reported for membership beginning the first of the month thereafter
provided the monthly earnings threshold as provided under subdivision 2a is met;

(14) public hospital employees who elected not to participate as members of the
association before 1972 and who did not elect to participate from July 1, 1988, to October
1, 1988;

(15) except as provided in section 353.86, volunteer ambulance service personnel, as
defined in subdivision 35, but persons who serve as volunteer ambulance service personnel
may still qualify as public employees under subdivision 2 and may be members of the
Public Employees Retirement Association and participants in the general employees
retirement plan or the public employees police and fire plan, whichever applies, on the
basis of compensation received from public employment service other than service as
volunteer ambulance service personnel;

(16) except as provided in section 353.87, volunteer firefighters, as defined in
subdivision 36, engaging in activities undertaken as part of volunteer firefighter duties,
but a person who is a volunteer firefighter may still qualify as a public employee under
subdivision 2 and may be a member of the Public Employees Retirement Association and
a participant in the general employees retirement plan or the public employees police
and fire plan, whichever applies, on the basis of compensation received from public
employment activities other than those as a volunteer firefighter;

(17) pipefitters and associated trades personnel employed by Independent School
District No. 625, St. Paul, with coverage under a collective bargaining agreement by the
pipefitters local 455 pension plan who were either first employed after May 1, 1997, or,
if first employed before May 2, 1997, elected to be excluded under Laws 1997, chapter
241, article 2, section 12;

(18) electrical workers, plumbers, carpenters, and associated trades personnel who
are employed by Independent School District No. 625, St. Paul, or the city of St. Paul,
who have retirement coverage under a collective bargaining agreement by the Electrical
Workers Local 110 pension plan, the United Association Plumbers Local 34 pension plan,
or the pension plan applicable to Carpenters Local 87 who were either first employed after
May 1, 2000, or, if first employed before May 2, 2000, elected to be excluded under
Laws 2000, chapter 461, article 7, section 5;

(19) bricklayers, allied craftworkers, cement masons, glaziers, glassworkers,
painters, allied tradesworkers, and plasterers who are employed by the city of St. Paul
or Independent School District No. 625, St. Paul, with coverage under a collective
bargaining agreement by the Bricklayers and Allied Craftworkers Local 1 pension plan,
the Cement Masons Local 633 pension plan, the Glaziers and Glassworkers Local L-1324
pension plan, the Painters and Allied Trades Local 61 pension plan, or the Twin Cities
Plasterers Local 265 pension plan who were either first employed after May 1, 2001, or if
first employed before May 2, 2001, elected to be excluded under Laws 2001, First Special
Session chapter 10, article 10, section 6;

(20) plumbers who are employed by the Metropolitan Airports Commission, with
coverage under a collective bargaining agreement by the Plumbers Local 34 pension plan,
who either were first employed after May 1, 2001, or if first employed before May 2,
2001, elected to be excluded under Laws 2001, First Special Session chapter 10, article
10, section 6;

(21) employees who are hired after June 30, 2002, to fill seasonal positions under
subdivision 12b which are limited in duration by the employer to 185 consecutive calendar
days or less in each year of employment with the governmental subdivision;

(22) persons who are provided supported employment or work-study positions
by a governmental subdivision and who participate in an employment or industries
program maintained for the benefit of these persons where the governmental subdivision
limits the position's duration to three years or less, including persons participating in a
federal or state subsidized on-the-job training, work experience, senior citizen, youth, or
unemployment relief program where the training or work experience is not provided as a
part of, or for, future permanent public employment;

(23) independent contractors and the employees of independent contractors;

(24) reemployed annuitants of the association during the course of that
reemployment; and

(25) persons appointed to serve on a board or commission of a governmental
subdivision or an instrumentality thereof.

(b) Any person performing the duties of a public officer in a position defined in
subdivision 2a, paragraph (a), clause (3), is not an independent contractor and is not an
employee of an independent contractor.

Sec. 51.

Minnesota Statutes 2012, section 353.01, subdivision 6, is amended to read:

Subd. 6.

Governmental subdivision.

(a) "Governmental subdivision" means a
county, city, town, school district within this state, or a department, unit or instrumentality
of state or local government, or any public body established under state or local
authority that has a governmental purpose, is under public control, is responsible for the
employment and payment of the salaries of employees of the entity, and receives a major
portion of its revenues from taxation, fees, assessments or from other public sources.

(b) Governmental subdivision also means the Public Employees Retirement
Association, the League of Minnesota Cities, the Association of Metropolitan
Municipalities, charter schools formed under section 124D.10, service cooperatives
exercising retirement plan participation under section 123A.21, subdivision 5, joint powers
boards organized under section 471.59, subdivision 11, paragraph (a), family service
collaboratives and children's mental health collaboratives organized under section 471.59,
subdivision 11, paragraph (b) or (c), provided that the entities creating the collaboratives
are governmental units that otherwise qualify for retirement plan membership, public
hospitals owned or operated by, or an integral part of, a governmental subdivision or
governmental subdivisions, the Association of Minnesota Counties, the Minnesota
Inter-county Association, the Minnesota Municipal Utilities Association, the Metropolitan
Airports Commission, the University of Minnesota with respect to police officers covered
by the public employees police and fire retirement plan, the Minneapolis Employees
Retirement Fund for employment initially commenced after June 30, 1979, the Range
Association of Municipalities and Schools, soil and water conservation districts, economic
development authorities created or operating under sections 469.090 to 469.108, the Port
Authority of the city of St. Paul, the Seaway Port Authority of Duluth, the Red Wing
Port Authority, the Spring Lake Park Fire Department, incorporated, the Lake Johanna
Volunteer Fire Department, incorporated, the Red Wing Environmental Learning Center,
the Dakota County Agricultural Society, new text begin and new text end Hennepin Healthcare System, Inc. deleted text begin , and the
Minneapolis Firefighters Relief Association and Minneapolis Police Relief Association
with respect to staff covered by the Public Employees Retirement Association general plan.
deleted text end

(c) Governmental subdivision does not mean any municipal housing and
redevelopment authority organized under the provisions of sections 469.001 to 469.047;
or any port authority organized under sections 469.048 to 469.089 other than the Port
Authority of the city of St. Paul or the Seaway Port Authority of Duluth and other than
the Red Wing Port Authority; or any hospital district organized or reorganized prior to
July 1, 1975, under sections 447.31 to 447.37 or the successor of the district; or the board
of a family service collaborative or children's mental health collaborative organized
under sections 124D.23, 245.491 to 245.495, or 471.59, if that board is not controlled
by representatives of governmental units.

(d) A nonprofit corporation governed by chapter 317A or organized under Internal
Revenue Code, section 501(c)(3), which is not covered by paragraph (a) or (b), is not a
governmental subdivision unless the entity has obtained a written advisory opinion from
the United States Department of Labor or a ruling from the Internal Revenue Service
declaring the entity to be an instrumentality of the state so as to provide that any future
contributions by the entity on behalf of its employees are contributions to a governmental
plan within the meaning of Internal Revenue Code, section 414(d).

(e) A public body created by state or local authority may request membership on
behalf of its employees by providing sufficient evidence that it meets the requirements in
paragraph (a).

(f) An entity determined to be a governmental subdivision is subject to the reporting
requirements of this chapter upon receipt of a written notice of eligibility from the
association.

Sec. 52.

Minnesota Statutes 2012, section 353.01, subdivision 10, is amended to read:

Subd. 10.

Salary.

(a) Subject to the limitations of section 356.611, "salary" means:

(1) the periodic compensation of a public employee, before deductions for deferred
compensation, supplemental retirement plans, or other voluntary salary reduction
programs, and also means "wages" and includes net income from fees; new text begin and
new text end

(2) for a public employee who is covered by a supplemental retirement plan under
section 356.24, subdivision 1, clause (8), (9), or (10), which require all plan contributions
be made by the employer, the contribution to the applicable supplemental retirement plan
when an agreement between the parties establishes that the contribution will either result
in a mandatory reduction of employees' wages through payroll withholdings, or be made
in lieu of an amount that would otherwise be paid as wages deleted text begin ; and deleted text end new text begin .
new text end

deleted text begin (3) for a public employee who has prior service covered by a local police or
firefighters relief association that has consolidated with the Public Employees Retirement
Association or to which section 353.665 applies and who has elected coverage either
under the public employees police and fire fund benefit plan under section 353A.08
following the consolidation or under section 353.665, subdivision 4, the rate of salary
upon which member contributions to the special fund of the relief association were made
prior to the effective date of the consolidation as specified by law and by bylaw provisions
governing the relief association on the date of the initiation of the consolidation procedure
and the actual periodic compensation of the public employee after the effective date of
consolidation.
deleted text end

(b) Salary does not mean:

(1) the fees paid to district court reporters, unused annual vacation or sick leave
payments, in lump-sum or periodic payments, severance payments, reimbursement of
expenses, lump-sum settlements not attached to a specific earnings period, or workers'
compensation payments;

(2) employer-paid amounts used by an employee toward the cost of insurance
coverage, employer-paid fringe benefits, flexible spending accounts, cafeteria plans, health
care expense accounts, day care expenses, or any payments in lieu of any employer-paid
group insurance coverage, including the difference between single and family rates that
may be paid to a member with single coverage and certain amounts determined by the
executive director to be ineligible;

(3) the amount equal to that which the employing governmental subdivision would
otherwise pay toward single or family insurance coverage for a covered employee when,
through a contract or agreement with some but not all employees, the employer:

(i) discontinues, or for new hires does not provide, payment toward the cost of the
employee's selected insurance coverages under a group plan offered by the employer;

(ii) makes the employee solely responsible for all contributions toward the cost of
the employee's selected insurance coverages under a group plan offered by the employer,
including any amount the employer makes toward other employees' selected insurance
coverages under a group plan offered by the employer; and

(iii) provides increased salary rates for employees who do not have any
employer-paid group insurance coverages;

(4) except as provided in section 353.86 or 353.87, compensation of any kind paid to
volunteer ambulance service personnel or volunteer firefighters, as defined in subdivision
35 or 36;

(5) the amount of compensation that exceeds the limitation provided in section
356.611; and

(6) amounts paid by a federal or state grant for which the grant specifically
prohibits grant proceeds from being used to make pension plan contributions, unless the
contributions to the plan are made from sources other than the federal or state grant.

(c) Amounts provided to an employee by the employer through a grievance
proceeding or a legal settlement are salary only if the settlement is reviewed by the
executive director and the amounts are determined by the executive director to be
consistent with paragraph (a) and prior determinations.

Sec. 53.

Minnesota Statutes 2012, section 353.01, subdivision 16, is amended to read:

Subd. 16.

Allowable service; limits and computation.

(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, subdivision 12, 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 with pay from which deductions for
employee contributions are made, deposited, and credited to the fund;

(5) a period of authorized personal, parental, or medical leave of absence without
pay, including a leave of absence covered under the federal Family Medical Leave Act,
that does not exceed one year, and for which a member obtained service credit for each
month in the leave period by payment under section 353.0161 to the fund made in place of
salary deductions. An employee must return to public service and render a minimum of
three months of allowable service in order to be eligible to make payment under section
353.0161 for a subsequent authorized leave of absence without pay. Upon payment, the
employee must be granted allowable service credit for the purchased period;

(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 rate of 8.5 percent a year, 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 8.5 percent interest, 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, excluding overtime pay, 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, excluding overtime pay, 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 a rate of 8.5 percent
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) For calculating benefits under sections 353.30, 353.31, 353.32, and 353.33 for
state officers and employees displaced by the Community Corrections Act, chapter 401,
and transferred into county service under section 401.04, "allowable service" means the
combined years of allowable service as defined in paragraph (a), clauses (1) to (6), and
section 352.01, subdivision 11.

deleted text begin (c) For a public employee who has prior service covered by a local police or
firefighters relief association that has consolidated with the Public Employees Retirement
Association under chapter 353A or to which section 353.665 applies, and who has
elected the type of benefit coverage provided by the public employees police and fire
fund either under section 353A.08 following the consolidation or under section 353.665,
subdivision 4, "allowable service" is a period of service credited by the local police or
firefighters relief association as of the effective date of the consolidation based on law
and on bylaw provisions governing the relief association on the date of the initiation
of the consolidation procedure.
deleted text end

deleted text begin (d) deleted text end new text begin (c) new text end No member may receive more than 12 months of allowable service credit in a
year either for vesting purposes or for benefit calculation purposes. 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.

deleted text begin (e) deleted text end new text begin (d) new text end MS 2002 [Expired]

Sec. 54.

Minnesota Statutes 2012, section 353.64, subdivision 1a, is amended to read:

Subd. 1a.

Police and fire plan; other members.

(a) A person who deleted text begin prior to July
1, 1961, was a member of the police and fire plan, by virtue of being a police officer or
firefighter, shall, as long as the person remains in either position, continue membership in
the plan.
deleted text end

deleted text begin (b) A person who deleted text end was employed by a governmental subdivision as a police officer
and was a member of the police and fire plan on July 1, 1978, by virtue of being a police
officer as defined by this section on that date, and if employed by the same governmental
subdivision in a position in the same department in which the person was employed on
that date, continues to be a member of the plan, whether or not that person has the power
of arrest by warrant and is licensed by the Peace Officers Standards and Training Board
after that date.

deleted text begin (c) deleted text end new text begin (b) new text end A person who was employed as a correctional officer by Rice county before
July 1, 1998, for the duration of employment in the correctional position held on July 1,
1998, continues to be a member of the public employees police and fire plan, whether or
not the person has the power of arrest by warrant and is licensed by the Peace Officers
Standards and Training Board after that date.

deleted text begin (d) A person who was employed by a governmental subdivision as a police officer
or a firefighter, whichever applies, was an active member of the local police or salaried
firefighters relief association located in that governmental subdivision by virtue of that
employment as of the effective date of the consolidation as authorized by sections
353A.01 to 353A.10, and has elected coverage by the public employees police and fire
plan, shall become a member of the police and fire plan after that date if employed by
the same governmental subdivision in a position in the same department in which the
person was employed on that date.
deleted text end

deleted text begin (e) Any police officer or firefighter of a relief association that has consolidated
with the association for which the employee has not elected coverage by the public
employees police and fire plan as provided in sections 353A.01 to 353A.10, or any police
officer or firefighter to whom section 353.665 applies who has not elected coverage by
the public employees police and fire plan as provided in section 353.665, subdivision 4,
must become a member of the public employees police and fire plan, but is not subject
to the provisions of sections 353.651 to 353.659 unless an election for such coverage is
made under section 353.665, subdivision 4.
deleted text end

Sec. 55.

Minnesota Statutes 2012, section 353.659, is amended to read:

353.659 LOCAL RELIEF ASSOCIATION CONSOLIDATION ACCOUNT
BENEFITS.

new text begin (a) new text end For any person who deleted text begin has deleted text end new text begin had new text end prior service covered by a local police or firefighters
relief association which has deleted text begin consolidated deleted text end new text begin merged new text end with the public employees new text begin police and
fire new text end retirement deleted text begin association deleted text end new text begin plan new text end and who has elected the type of benefit coverage provided
by the public employees police and fire fund benefit plan deleted text begin under section 353A.08 following
the consolidation deleted text end new text begin as permitted by the applicable law new text end , deleted text begin any deleted text end new text begin the new text end retirement benefits payable
are governed by the applicable provisions of this chapter.

new text begin (b) new text end For any person who deleted text begin has deleted text end new text begin had new text end prior service covered by a local police or firefighters
relief association which has deleted text begin consolidated deleted text end new text begin merged new text end with the public employees new text begin police and fire
new text end retirement deleted text begin association deleted text end new text begin plan new text end and who deleted text begin has deleted text end new text begin did new text end not deleted text begin elected deleted text end new text begin elect new text end the type of benefit coverage
provided by the public employees police and fire fund benefit plan deleted text begin under section 353A.08
following the consolidation deleted text end new text begin as permitted by the applicable law new text end , deleted text begin any deleted text end new text begin the new text end retirement benefits
payable are governed by the provisions of new text begin Minnesota Statutes 2012, new text end sections 353B.01 to
353B.13 which deleted text begin apply deleted text end new text begin applied new text end to the new text begin applicable former new text end relief association new text begin or by section
353.6511 or 353.6512, if applicable new text end .

Sec. 56.

Minnesota Statutes 2012, section 353.665, subdivision 1, is amended to read:

Subdivision 1.

deleted text begin Merger authorized deleted text end new text begin Application new text end .

(a) deleted text begin Notwithstanding any
provision of law to the contrary, unless the applicable municipality elects otherwise under
paragraph (b), every deleted text end new text begin This section applies to the new text end local police and fire new text begin relief associations or
new text end consolidation deleted text begin account under chapter 353A in existence on March 1, 1999, becomes a part
of deleted text end new text begin accounts that merged with new text end the public employees police and fire plan and fund deleted text begin governed
by sections 353.63 to 353.659 on July 1, 1999 deleted text end new text begin and are specified in paragraph (b) new text end .

(b) deleted text begin If a municipality desires to retain its consolidation account deleted text end new text begin The former local
police or fire relief associations new text end or consolidation accounts deleted text begin , whichever applies, the
governing body of the municipality must adopt a resolution to that effect and must file a
copy of the resolution with the secretary of state, the state auditor, the legislative auditor,
the management and budget commissioner, the revenue commissioner, the executive
director of the public employees retirement association, and the executive director of
the Legislative Commission on Pensions and Retirement. The retention election must
apply to both consolidation accounts if the municipality is associated with more than
one consolidation account. The retention resolution must be adopted and filed with all
recipients before June 15, 1999. deleted text end new text begin are:
new text end

new text begin (1) the former local police and fire consolidation accounts that merged with the public
employees police and fire retirement plan and fund under Laws 1999, chapter 222, article 4;
new text end

new text begin (2) the former Minneapolis Firefighters Relief Association;
new text end

new text begin (3) the former Minneapolis Police Relief Association;
new text end

new text begin (4) the former Fairmont Police Relief Association; and
new text end

new text begin (5) the former Virginia Fire Consolidation Account.
new text end

Sec. 57.

Minnesota Statutes 2012, section 353.665, subdivision 5, is amended to read:

Subd. 5.

Benefit coverage for deleted text begin retirees and benefit recipients deleted text end new text begin certain former local
relief association or consolidation account members new text end .

(a) deleted text begin A person who received a
deleted text end new text begin Except as provided in paragraph (b), (c), or (d), the annuity, new text end service pension, deleted text begin a deleted text end disability
pension or benefit, or deleted text begin a deleted text end survivor benefit deleted text begin from a merging deleted text end new text begin attributable to or of a former
member of a former merged new text end local police or fire consolidation account deleted text begin for the month of June
1999, and deleted text end who deleted text begin has deleted text end new text begin did new text end not deleted text begin previously elected participation in the Minnesota postretirement
investment fund for any future postretirement adjustments rather than the postretirement
adjustment mechanism or mechanisms of the relief association benefit plan under
section 353A.08, subdivision 1, may elect participation in the Minnesota postretirement
investment fund for any future postretirement adjustments or retention of the
postretirement adjustment mechanism or mechanisms of the relief association benefit plan
as reflected in the applicable provisions of chapter 353B. This election must be in writing
on a form prescribed by the executive director and must be made before September 1,
1999. deleted text end new text begin elect coverage by all or a portion of the public employees police and fire retirement
plan as permitted by applicable law must be calculated or computed under the benefit plan
provisions of the applicable former local police or paid firefighters relief association.
new text end

(b) deleted text begin If an eligible person is a minor, the election must be made by the person's
parent or legal guardian. If the eligible person makes no affirmative election under this
subdivision, the person retains the postretirement adjustment mechanism or mechanisms of
the relief association benefit plan as reflected in the applicable provisions of chapter 353B.
deleted text end new text begin The annuity, service pension, disability pension or benefit, or survivor benefit attributable
to or of a former member of the former Minneapolis Firefighters Relief Association or of
the former Minneapolis Police Relief Association must be calculated or computed under
sections 353.01, subdivision 10a or 10b, and 353.6511, or 353.6512, whichever applies.
new text end

(c) deleted text begin The survivor benefit payable on behalf of any service pension or disability benefit
recipient who elects participation in the Minnesota postretirement investment fund must
be calculated under the relief association benefit plan in effect on the effective date of
consolidation under chapter 353A as reflected in the applicable provisions of chapter 353B.
deleted text end new text begin The annuity, service pension, disability pension or benefit, or survivor benefit attributable
to or of a former member of the former Fairmont Police Relief Association must be
calculated or computed under Minnesota Statutes 2000, sections 423.41 to 423.46, 423.48
to 423.59, 423.61, and 423.62; Laws 1963, chapter 423; Laws 1977, chapter 100; and Laws
1999, chapter 222, article 3, section 4, except that the annual base salary figure for pension
and benefit determinations upon consolidation and for the balance of calendar year 2012 is
$106,666.67 and after December 31, 2012, annual postretirement adjustments of pensions
and benefits in force must be calculated solely under section 356.415, subdivision 1c.
new text end

new text begin (d) The annuity, service pension, disability pension or benefit, or survivor benefit
attributable to or of a former member of the former Virginia firefighters consolidation
account must be calculated or computed under the election made under Minnesota
Statutes 2012, section 353A.08, unless the person made a subsequent election under Laws
2012, chapter 286, article 11, section 5, subdivision 4, subject to any additional ad hoc
postretirement adjustment under Laws 2012, chapter 286, article 11, section 5, subdivision
5, paragraph (d).
new text end

Sec. 58.

Minnesota Statutes 2012, section 353.665, subdivision 8, is amended to read:

Subd. 8.

Member and employer contributions.

(a) deleted text begin Effective on the first day of the
first full pay period following June 30, 1999, deleted text end new text begin Except as provided in paragraph (b), (c),
or (d), new text end the employee contribution rate for deleted text begin merging deleted text end new text begin merged new text end former consolidation account
active members is the rate specified in section 353.65, subdivision 2, and the regular
municipal contribution rate on behalf of new text begin merged new text end former consolidation account active
members is the rate specified in section 353.65, subdivision 3.

(b) deleted text begin The municipality associated with a merging former local consolidation account
that had a positive value amortizable base calculation under subdivision 7, paragraph (d),
after the preliminary calculation or the second calculation, whichever applies, must make
an additional municipal contribution to the public employees police and fire plan for
the period from January 1, 2000, to December 31, 2009. The amount of the additional
municipal contribution is the amount calculated by the actuary retained under section
356.214 and certified by the executive director of the Public Employees Retirement
Association by which the amortizable base amount would be amortized on a level dollar
annual end-of-the-year contribution basis, using an 8.5 percent interest rate assumption.
The additional municipal contribution is payable during the month of January, is without
any interest, or if made after January 31, but before the next following December 31,
is payable with interest for the period since January 1 at a rate which is equal to the
preretirement interest rate assumption specified in section 356.215, subdivision 8,
applicable to the public employees police and fire fund expressed as a monthly rate and
compounded on a monthly basis or if made after December 31 of the year in which the
additional municipal contribution is due is payable with interest at a rate which is four
percent greater than the highest interest rate assumption specified in section 356.215,
subdivision 8, expressed as a monthly rate and compounded monthly from January 1 of the
year in which the additional municipal contribution is due until the date on which payment
is made. deleted text end new text begin With respect to active members of the merged former Minneapolis Firefighters
Relief Association and the merged former Minneapolis Police Relief Association, there are
no employee contributions payable and the employer contribution on behalf of those active
members is at the rate specified in section 353.65, subdivision 3, applied to the active
member's salary. In addition, an additional municipal contribution is payable by the city of
Minneapolis annually on July 15, set at the amount calculated as of December 30, 2011, as
sufficient to amortize, on a level annual dollar basis by December 31, 2031, the unfunded
present value figure calculated as required by Laws 2011, First Special Session chapter 8,
article 6, section 14, subdivision 6, paragraph (a), and article 7, section 14, subdivision
6, paragraph (a). If the postretirement or preretirement interest rate actuarial assumption
applicable to the public employees police and fire retirement plan under section 356.215,
subdivision 8, is modified from the rates specified in Minnesota Statutes 2010, section
356.215, subdivision 8, the remainder present value of future benefits amount calculation
under Laws 2011, First Special Session chapter 8, article 6, section 14, subdivision 6,
paragraph (a), and article 7, section 14, subdivision 6, paragraph (a), updated for the passage
of time, must be revised and the amortization contribution by the city of Minneapolis for
the balance of the amortization period must be redetermined by the actuary retained under
section 356.214 and certified by the executive director to the city of Minneapolis.
new text end

new text begin (c) If there are assets of the former Fairmont Police Relief Association in excess of
the present value of future benefits as of June 29, 2012, these assets must be credited to an
interest bearing suspense account within the public employees police and fire retirement
fund, must be used to offset any amount payable under paragraph (a) until June 30, 2015,
and, after June 30, 2015, must be paid to the city of Fairmont. The suspense account must
be credited with the same rate of investment return as the public employees police and fire
retirement fund. If, after June 29, 2012, the postretirement or preretirement interest rate
actuarial assumption applicable to the public employees police and fire retirement plan
under section 356.215, subdivision 8, is modified from the rates specified in Minnesota
Statutes 2010, section 356.215, subdivision 8, the remainder present value of future
benefits amount calculation under paragraph (a), updated for the passage of time, must be
revised and the amortization contribution by the city of Fairmont for the balance of the
amortization period must be redetermined by the actuary retained under section 356.214
and certified by the executive director to the city of Fairmont.
new text end

new text begin (d) If there was a remainder present value of future benefits amounts under
Laws 2012, chapter 286, article 11, section 5, subdivision 5, paragraph (a), the city of
Virginia shall pay an additional municipal contribution annually on or before December
31 sufficient to amortize on a level annual dollar basis by December 31, 2020, that
remainder present value of future benefits amounts of the former Virginia fire department
consolidation account. If, after June 29, 2012, the postretirement or preretirement interest
rate actuarial assumption applicable to the public employees police and fire retirement plan
under section 356.215, subdivision 8, is modified from the rates specified in Minnesota
Statutes 2010, section 356.215, subdivision 8, the remainder present value of future
benefits amount calculation under paragraph (a), updated for the passage of time, must be
revised and any amortization contribution by the city of Virginia for the balance of the
amortization period must be redetermined by the actuary retained under section 356.214
and certified by the executive director to the city of Virginia.
new text end

Sec. 59.

Minnesota Statutes 2012, section 353.71, subdivision 1, is amended to read:

Subdivision 1.

Eligibility.

Any person who has been a member of a defined
benefit retirement plan administered by the Public Employees Retirement Association,
or a retirement plan administered by the Minnesota State Retirement System, or the
Teachers Retirement Association, or any other public retirement system in the state of
Minnesota having a like provision, except a retirement plan providing benefits for police
officers or firefighters governed by sections deleted text begin 69.77 or deleted text end 69.771 to 69.776, new text begin or by sections 31
to 43, new text end is entitled, when qualified, to an annuity from each retirement plan if the total
allowable service in all retirement plans or in any two of these retirement plans totals the
number of years of allowable service required to receive a normal retirement annuity for
that retirement plan, provided that no portion of the allowable service upon which the
retirement annuity from one retirement plan is based is again used in the computation for
benefits from another retirement plan and provided further that the person has not taken a
refund from any one of these retirement plans since the person's membership in that
association or system last terminated. The annuity from each fund must be determined by
the appropriate provisions of the law except that the requirement that a person must have
at least a specific minimum period of allowable service in the respective association or
system does not apply for the purposes of this section if the combined service in two or
more of these retirement plans equals the number of years of allowable service required to
receive a normal retirement annuity for that retirement plan.

Sec. 60.

Minnesota Statutes 2012, section 356.20, subdivision 2, is amended to read:

Subd. 2.

Covered public pension plans and funds.

This section applies to the
following public pension plans:

(1) the general state employees retirement plan of the Minnesota State Retirement
System;

(2) the general employees retirement plan of the Public Employees Retirement
Association;

(3) the Teachers Retirement Association;

(4) the State Patrol retirement plan;

(5) the St. Paul Teachers Retirement Fund Association;

(6) the Duluth Teachers Retirement Fund Association;

(7) the University of Minnesota faculty retirement plan;

(8) the University of Minnesota faculty supplemental retirement plan;

(9) the judges retirement fund;

(10) deleted text begin a police or firefighter's relief association specified or described in section 69.77,
subdivision 1a deleted text end new text begin the Bloomington Fire Department Relief Association new text end ;

(11) a volunteer firefighter relief association governed by section 69.771, subdivision
1;

(12) the public employees police and fire plan of the Public Employees Retirement
Association;

(13) the correctional state employees retirement plan of the Minnesota State
Retirement System;

(14) the local government correctional service retirement plan of the Public
Employees Retirement Association; and

(15) the voluntary statewide lump-sum volunteer firefighter retirement plan.

Sec. 61.

Minnesota Statutes 2012, section 356.215, subdivision 18, is amended to read:

Subd. 18.

Establishment of actuarial assumptions.

(a) Before July 2, 2010, the
actuarial assumptions used for the preparation of actuarial valuations under this section
that are other than preretirement interest, postretirement interest, salary increase, and
payroll increase may be changed only with the approval of the Legislative Commission on
Pensions and Retirement or after a period of one year has elapsed since the date on which
the proposed assumption change or changes were received by the Legislative Commission
on Pensions and Retirement without commission action.

(b) After July 1, 2010, the actuarial assumptions used for the preparation of actuarial
valuations under this section that are other than postretirement interest and preretirement
interest may be changed only with the approval of the Legislative Commission on
Pensions and Retirement or after a period of one year has elapsed since the date on which
the proposed assumption change or changes were received by the Legislative Commission
on Pensions and Retirement without commission action.

(c) A change in the applicable actuarial assumptions may be proposed by the
governing board of the applicable pension fund or relief association, by the actuary
retained by the joint retirement systems under section 356.214 or by the actuary retained
by a local police or firefighters relief association governed by sections deleted text begin 69.77 or deleted text end 69.771 to
69.776 new text begin or by sections 31 to 43 new text end , if one is retained.

Sec. 62.

Minnesota Statutes 2012, section 356.216, is amended to read:

356.216 CONTENTS OF ACTUARIAL VALUATIONS FOR LOCAL
deleted text begin POLICE AND FIRE FUNDS deleted text end new text begin MONTHLY VOLUNTEER FIREFIGHTER RELIEF
ASSOCIATIONS new text end .

The provisions of section 356.215 that govern the contents of actuarial valuations
deleted text begin must deleted text end apply to new text begin the Bloomington Fire Department Relief Association and to new text end any local deleted text begin police
or fire pension fund or deleted text end new text begin monthly volunteer firefighter new text end relief association required to make
an actuarial report under this section, except as follows:

deleted text begin (1) in calculating normal cost and other requirements, if required to be expressed as
a level percentage of covered payroll, the salaries used in computing covered payroll must
be the maximum rate of salary on which retirement and survivorship credits and amounts
of benefits are determined and from which any member contributions are calculated and
deducted;
deleted text end

deleted text begin (2) deleted text end new text begin (1) new text end in lieu of the amortization date specified in section 356.215, subdivision
11, the appropriate amortization target date specified in new text begin clause (2) or new text end section deleted text begin 69.77,
subdivision 4, or deleted text end 69.773, subdivision 4, deleted text begin clause deleted text end new text begin paragraph new text end (c), must be used in calculating
any required amortization contribution deleted text begin , except that if the actuarial report deleted text end new text begin ;
new text end

new text begin (2) new text end for the Bloomington Fire Department Relief Association deleted text begin indicates an deleted text end new text begin , any
new text end unfunded actuarial accrued liability deleted text begin , the unfunded obligation is to deleted text end new text begin must new text end be amortized on
a level dollar basis by December 31 of the year occurring 20 years deleted text begin later deleted text end new text begin after the year
in which the unfunded actuarial accrued liability initially occurred new text end , and new text begin , new text end if subsequent
actuarial valuations for the Bloomington Fire Department Relief Association deleted text begin determine
deleted text end new text begin indicate new text end a net actuarial experience loss incurred during the year which ended as of the day
before the most recent actuarial valuation date, any unfunded new text begin actuarial accrued new text end liability
due to that loss is to be amortized on a level dollar basis by December 31 of the year
occurring 20 years deleted text begin later deleted text end new text begin after the year in which the net actuarial experience loss occurred new text end ;

(3) in addition to the tabulation of active members and annuitants provided for in
section 356.215, subdivision 13, deleted text begin the member contributions for active members for the
calendar year and deleted text end the prospective annual deleted text begin retirement annuities deleted text end new text begin service pensions new text end under the
benefit plan for active members must be reported;

(4) actuarial valuations required under section new text begin 40 must be made annually and
actuarial valuations required under section new text end 69.773, subdivision 2, must be made deleted text begin at least
deleted text end every four years deleted text begin and actuarial valuations required under section 69.77 shall be made
annually deleted text end new text begin or as frequently as required by generally accepted accounting principles in the
government sector, whichever frequency requirement is shorter new text end ;

(5) the actuarial balance sheet showing accrued assets valued at market value deleted text begin if the
actuarial valuation is required to be prepared at least every four years or valued as current
assets under section 356.215, subdivision 1, paragraph (b) or (f), whichever applies, if the
actuarial valuation is required to be prepared annually deleted text end , actuarial accrued liabilities, and the
unfunded actuarial accrued liability must include the following required reserves:

(i) for active members:

deleted text begin 1. deleted text end new text begin (A) new text end retirement benefits new text begin or service pensions new text end ;

deleted text begin 2. deleted text end new text begin (B) new text end disability benefits; new text begin and
new text end

deleted text begin 3. refund liability due to death or withdrawal;
deleted text end

deleted text begin 4. deleted text end new text begin (C) new text end survivors' benefits;

(ii) for deferred annuitants' benefits;

(iii) for former members without vested rights;

(iv) for annuitants deleted text begin ; deleted text end new text begin :
new text end

deleted text begin 1. deleted text end new text begin (A) new text end retirement annuities new text begin or service pensions new text end ;

deleted text begin 2. deleted text end new text begin (B) new text end disability annuities; new text begin and
new text end

deleted text begin 3. surviving spouses' annuities;
deleted text end

deleted text begin 4. surviving children's annuities; deleted text end new text begin (C) survivor benefits.
new text end

In addition to those required reserves, separate items must be shown for additional
benefits, if any, which may not be appropriately included in the reserves listed above; and

(6) actuarial valuations are due new text begin to be filed with the state auditor new text end by the first day of
the seventh month after the end of the fiscal year which the actuarial valuation covers.

Sec. 63.

Minnesota Statutes 2012, section 356.219, subdivision 1, is amended to read:

Subdivision 1.

Report required.

(a) The State Board of Investment, on behalf
of the public pension funds and programs for which it is the investment authority, and
any Minnesota public pension plan that is not fully invested through the State Board of
Investment, including new text begin the Bloomington Fire Department Relief Association and new text end a local
deleted text begin police or deleted text end new text begin volunteer new text end firefighters relief association governed by sections deleted text begin 69.77 or deleted text end 69.771 to
69.775, shall report the information specified in subdivision 3 to the state auditor. The
state auditor may prescribe a form or forms for the purposes of the reporting requirements
contained in this section.

(b) new text begin The Bloomington Fire Department Relief Association and new text end a local deleted text begin police or
deleted text end new text begin volunteer new text end firefighters relief association governed by deleted text begin section 69.77 or deleted text end sections 69.771 to
69.775 is fully invested during a given calendar year for purposes of this section if all
assets of the applicable pension plan beyond sufficient cash equivalent investments to
cover six months expected expenses are invested under section 11A.17. The board of any
fully invested public pension plan remains responsible for submitting investment policy
statements and subsequent revisions as required by subdivision 3, paragraph (a).

(c) For purposes of this section, the State Board of Investment is considered to be
the investment authority for any Minnesota public pension fund required to be invested by
the State Board of Investment under section 11A.23, or for any Minnesota public pension
fund authorized to invest in the supplemental investment fund under section 11A.17 and
which is fully invested by the State Board of Investment.

(d) This section does not apply to the following plans:

(1) the Minnesota unclassified employees retirement program under chapter 352D;

(2) the public employees defined contribution plan under chapter 353D;

(3) the individual retirement account plans under chapters 354B and 354D;

(4) the higher education supplemental retirement plan under chapter 354C;

(5) any alternative retirement benefit plan established under section 383B.914; and

(6) the University of Minnesota faculty retirement plan.

Sec. 64.

Minnesota Statutes 2012, section 356.219, subdivision 2, is amended to read:

Subd. 2.

Asset class definition.

(a) For purposes of this section, "asset class"
means any of the following asset groupings as authorized in applicable law, bylaws, or
articles of incorporation:

(1) cash and any cash equivalent investments with maturities of one year or less
when issued;

(2) debt securities with maturities greater than one year when issued, including
but not limited to mortgage participation certificates and pools, asset backed securities,
guaranteed investment contracts, and authorized government and corporate obligations of
corporations organized under laws of the United States or any state, or the Dominion of
Canada or its provinces;

(3) stocks or convertible issues of any corporation organized under laws of the
United States or any state, or the Dominion of Canada or its provinces, or any corporation
listed on the New York Stock Exchange or the American Stock Exchange;

(4) international stocks or convertible issues;

(5) international debt securities; and

(6) real estate and venture capital.

(b) If the pension plan is investing deleted text begin under section 69.77, subdivision 9, section 69.775,
or any other applicable law, deleted text end in open-end investment companies registered under the
federal Investment Company Act of 1940, or in the Minnesota supplemental investment
fund under section 11A.17, this investment must be included under an asset class indicated
in paragraph (a), clauses (1) through (6), as appropriate. If the investment vehicle includes
underlying securities from more than one asset class as indicated by paragraph (a), clauses
(1) through (6), the investment may be treated as a separate asset class.

Sec. 65.

Minnesota Statutes 2012, section 356.219, subdivision 8, is amended to read:

Subd. 8.

Timing of reports.

(a) For deleted text begin salaried firefighter relief associations, police
deleted text end new text begin the Bloomington Fire Department new text end Relief deleted text begin associations, deleted text end new text begin Association new text end and new text begin the new text end volunteer
firefighter relief associations, the information required under this section must be
submitted by the due date for reports required under section 69.051, subdivision 1 or 1a,
as applicable. If a relief association satisfies the definition of a fully invested plan under
subdivision 1, paragraph (b), for the calendar year covered by the report required under
section 69.051, subdivision 1 or 1a, as applicable, the chief administrative officer of
the covered pension plan shall certify that compliance on a form prescribed by the state
auditor. The state auditor shall transmit annually to the State Board of Investment a list or
lists of covered pension plans which submitted certifications in order to facilitate reporting
by the State Board of Investment under paragraph (c).

(b) For the St. Paul Teachers Retirement Fund Association, the Duluth Teachers
Retirement Fund Association, and the University of Minnesota faculty supplemental
retirement plan, the information required under this section must be submitted to the state
auditor by June 1 of each year.

(c) The State Board of Investment, on behalf of pension funds specified in
subdivision 1, paragraph (c), must report information required under this section by
September 1 of each year.

Sec. 66.

Minnesota Statutes 2012, section 356.406, subdivision 1, is amended to read:

Subdivision 1.

Definitions.

(a) Each of the words or terms defined in this
subdivision has the meaning indicated.

(b) "Public pension plan" means any retirement plan or fund enumerated in section
356.20, subdivision 2, or 356.30, subdivision 3, new text begin the Bloomington Fire Department Relief
Association, new text end any relief association governed by deleted text begin section 69.77 or deleted text end sections 69.771 to
69.775, any retirement plan governed by chapter 354B or 354C, the Hennepin County
supplemental retirement plan governed by sections 383B.46 to 383B.52, or any housing
and redevelopment authority retirement plan.

(c) "Public pension plan member" means a person who is a participant covered by
a public pension plan; a former participant of a public pension plan who has sufficient
service to be entitled to receive a future retirement annuity or service pension; a recipient
of a retirement annuity, service pension, or disability benefit from a public pension plan; or
a former participant of a public pension plan who has member or employee contributions
to the person's credit in the public pension plan.

(d) "Survivor" means the surviving spouse, a former spouse, a surviving child, a
joint annuitant, a designated recipient of a second or remainder portion of an optional
annuity form, a beneficiary, or the estate of a deceased public pension plan member, as
those terms are commonly understood or defined in the benefit plan document of the
public pension plan.

(e) "Survivor benefit" means a surviving spouse benefit, surviving child benefit,
second or remainder portion of an optional annuity form, a death benefit, a funeral benefit,
or a refund of member or employee contributions payable on account of the death of a
public pension plan member as provided for in the benefit plan document of the public
pension plan.

Sec. 67.

Minnesota Statutes 2012, section 356A.01, subdivision 19, is amended to read:

Subd. 19.

Pension fund.

"Pension fund" means the assets amassed and held in a
pension plan, other than the general fund, as reserves for present and future payment
of benefits and administrative expenses. For new text begin the Bloomington Fire Department Relief
Association or new text end a retirement plan governed by section 69.77 or by chapter 424A, the term
means the relief association special fund.

Sec. 68.

Minnesota Statutes 2012, section 356A.06, subdivision 4, is amended to read:

Subd. 4.

Economic interest statement.

(a) Each member of the governing board
of a covered pension plan and the chief administrative officer of the plan shall file with
the plan a statement of economic interest.

(b) For a covered pension plan other than a plan specified in paragraph (c), the
statement must contain the information required by section 10A.09, subdivision 5, and
any other information that the fiduciary or the governing board of the plan determines is
necessary to disclose a reasonably foreseeable potential or actual conflict of interest.

(c) For a covered pension plan governed by sections 69.771 to 69.776 or deleted text begin a covered
pension plan governed by section 69.77 with deleted text end new text begin the Bloomington Fire Department Relief
Association if its special fund new text end assets new text begin are new text end under $8,000,000, the statement must contain
the following:

(1) the person's principal occupation and principal place of business;

(2) whether or not the person has an ownership of or interest of ten percent or greater
in an investment security brokerage business, a real estate sales business, an insurance
agency, a bank, a savings and loan, or another financial institution; and

(3) any relationship or financial arrangement that can reasonably be expected to
give rise to a conflict of interest.

(d) The statement must be filed annually with the chief administrative officer of
the plan and be available for public inspection during regular office hours at the office
of the pension plan.

(e) A disclosure form meeting the requirements of the federal Investment Advisers
Act of 1940, United States Code, title 15, sections 80b-1 to 80b-21 as amended, and
filed with the State Board of Investment or the pension plan meets the requirements of
this subdivision.

(f) The chief administrative officer of each covered pension plan, by January 15,
annually, shall transmit a certified listing of all individuals who have filed statements of
economic interest with the plan under this subdivision during the preceding 12 months
and the address of the office referenced in paragraph (d) to the Campaign Finance and
Public Disclosure Board.

Sec. 69.

Minnesota Statutes 2012, section 356A.07, subdivision 2, is amended to read:

Subd. 2.

Annual financial report.

A covered pension plan shall provide each
active plan participant and benefit recipient with a copy of the most recent annual financial
report required by section 356.20 and a copy of the most recent actuarial evaluation,
if any, required by section deleted text begin 69.77, deleted text end 69.773, 356.215, or 356.216, new text begin or by section 40, new text end or a
summary of those reports.

Sec. 70.

Minnesota Statutes 2012, section 423A.02, subdivision 1, is amended to read:

Subdivision 1.

Amortization state aid.

(a) deleted text begin A municipality in which is located a local
police or salaried firefighters relief association to which the provisions of section 69.77,
apply, that had an unfunded actuarial accrued liability in the most recent relief association
actuarial valuation, is entitled, upon application as required by the commissioner of
revenue, to receive local police and salaried firefighters' relief association amortization
state aid if the municipality and the appropriate relief association both comply with the
applicable provisions of sections 69.031, subdivision 5, 69.051, subdivisions 1 and 3, and
69.77. deleted text end new text begin The cities of Fairmont and Minneapolis are entitled, subject to subdivisions 2, 4,
and 5, to receive amortization state aid under this section.
new text end

(b) The total amount of amortization state aid to all entitled municipalities must not
exceed deleted text begin $5,055,000 deleted text end new text begin the appropriation under subdivision 3a new text end .

(c) deleted text begin Subject to the adjustment for the city of Minneapolis provided in this paragraph,
the amount of amortization state aid to which a municipality is entitled annually is an
amount equal to the level annual dollar amount required to amortize, by December 31,
2010, the unfunded actuarial accrued liability of the special fund of the appropriate
relief association as reported in the December 31, 1978, actuarial valuation of the relief
association prepared under sections 356.215 and 356.216, reduced by the dollar amount
required to pay the interest on the unfunded actuarial accrued liability of the special fund of
the relief association for calendar year 1981 set at the rate specified in Minnesota Statutes
1978, section 356.215, subdivision 8. For the city of Minneapolis, the amortization state
aid amount thus determined must be reduced by $747,232 on account of the former
Minneapolis Police Relief Association and by $772,768 on account of the former
Minneapolis Fire Department Relief Association. deleted text end new text begin The amortization state aid amounts are:
new text end

	new text begin City new text end	new text begin Aid Amount new text end
	new text begin Fairmont new text end	new text begin $24,172 new text end
	new text begin Minneapolis new text end	new text begin $2,728,547 new text end

If the amortization state aid amounts determined under this paragraph exceed the
amount appropriated for this purpose new text begin under subdivision 3a new text end , the amortization state aid for
actual allocation must be reduced pro rata.

(d) new text begin Each municipality is eligible for an amortization state aid payment in a fiscal
year if:
new text end

new text begin (1) for Fairmont, the executive director of the Public Employees Retirement
Association certifies on or before June 30 that a municipal contribution with respect to the
former Fairmont Police Relief Association is payable in the upcoming fiscal year under
section 353.665, subdivision 8, paragraph (c); and
new text end

new text begin (2) for Minneapolis, the executive director of the Public Employees Retirement
Association certifies on or before June 30 that an additional employer contribution with
respect to either the former Minneapolis Firefighters Relief Association or the former
Minneapolis Police Relief Association is payable in the upcoming fiscal year under section
353.665, subdivision 8, paragraph (b).
new text end

Payment of amortization state aid to municipalities must be made deleted text begin directly deleted text end to
the municipalities involved in three equal installments on July 15, September 15, and
November 15 annually. Upon receipt of amortization state aid, the municipal treasurer
shall transmit the aid amount to the deleted text begin treasurer deleted text end new text begin custodian new text end of the local deleted text begin relief association deleted text end new text begin trust
fund or to the executive director of the public employees police and fire retirement fund,
whichever applies, new text end for immediate deposit deleted text begin in the special fund of the relief association deleted text end .

(e) The commissioner of revenue shall new text begin administer the amortization state aid program.
The commissioner shall new text end prescribe and periodically revise new text begin , as necessary, new text end the deleted text begin form for and
deleted text end new text begin required new text end content of the deleted text begin application deleted text end new text begin certifications new text end for deleted text begin the deleted text end amortization state aid.

deleted text begin (f) The amount required under this section, as provided in subdivision 3a, is
appropriated annually from the general fund to the commissioner of revenue.
deleted text end

Sec. 71.

Minnesota Statutes 2012, section 423A.02, subdivision 1b, is amended to read:

Subd. 1b.

Additional amortization state aid.

deleted text begin (a) Annually, on October 1, the
commissioner of revenue shall allocate the additional amortization state aid transferred
under section 69.021, subdivision 11, to:
deleted text end

deleted text begin (1) all police or salaried firefighters relief associations governed by and in full
compliance with the requirements of section 69.77, that had an unfunded actuarial accrued
liability in the actuarial valuation prepared under sections 356.215 and 356.216 as of the
preceding December 31;
deleted text end

deleted text begin (2) all local police or salaried firefighter consolidation accounts governed by chapter
353A that are certified by the executive director of the public employees retirement
association as having for the current fiscal year an additional municipal contribution
amount under section 353A.09, subdivision 5, paragraph (b), and that have implemented
section 353A.083, subdivision 1, if the effective date of the consolidation preceded May
24, 1993, and that have implemented section 353A.083, subdivision 2, if the effective date
of the consolidation preceded June 1, 1995; and
deleted text end

deleted text begin (3) the municipalities that are required to make an additional municipal contribution
under section 353.665, subdivision 8; 353.667, subdivision 6; or 353.668, subdivision
6, for the duration of the required additional contribution.
deleted text end

deleted text begin (b) The commissioner shall allocate the state aid on the basis of the proportional share
of the relief association or consolidation account of the total unfunded actuarial accrued
liability of all recipient relief associations and consolidation accounts as of December 31,
1993, for relief associations, and as of June 30, 1994, for consolidation accounts.
deleted text end

deleted text begin (c) deleted text end new text begin (a) new text end Beginning October 1, deleted text begin 2000 deleted text end new text begin 2013 new text end , and annually thereafter, the commissioner
shall allocate the new text begin additional amortization new text end state aid, including any state aid in excess of the
limitation in subdivision 4, on the following basis:

deleted text begin (1) 64.5 percent to the municipalities to which section 353.665, subdivision
8, paragraph (b), or 353A.09, subdivision 5, paragraph (b), apply for distribution in
accordance with paragraph (b) and subject to the limitation in subdivision 4;
deleted text end

deleted text begin (2) 34.2 deleted text end new text begin (1) 47.1 new text end percent to the city of Minneapolis to deleted text begin fund any unfunded actuarial
accrued liability in the actuarial valuation prepared under sections 356.215 and 356.216
as of the preceding December 31 for the Minneapolis Police Relief Association or the
Minneapolis Fire Department Relief Association; and deleted text end new text begin defray the employer costs associated
with police and firefighter retirement coverage;
new text end

new text begin (2) 25.8 percent as additional funding to support the minimum fire state aid for
volunteer firefighter relief associations under section 69.021, subdivision 7, paragraph (d);
new text end

new text begin (3) 12.9 percent to the city of Duluth to defray employer costs associated with
police and firefighter retirement coverage;
new text end

new text begin (4) 12.9 percent to the St. Paul Teachers Retirement Fund Association if the
investment performance requirement of paragraph (c) is met; and
new text end

deleted text begin (3) deleted text end new text begin (5) new text end 1.3 percent to the city of Virginia to deleted text begin fund any unfunded actuarial accrued
liability in the actuarial valuation prepared under sections 356.215 and 356.216 as of the
preceding December 31 for the Virginia Fire Department Relief Association deleted text end new text begin defray the
employer contribution under section 353.665, subdivision 8, paragraph (d) new text end .

If there is no deleted text begin unfunded actuarial accrued liability in both deleted text end new text begin additional employer
contribution under section 353.665, subdivision 8, paragraph (b), certified under
subdivision 1, paragraph (d), clause (2), with respect to new text end the new text begin former new text end Minneapolis Police
Relief Association and the new text begin former new text end Minneapolis Fire Department Relief Association deleted text begin as
disclosed in the most recent actuarial valuations for the relief associations prepared under
sections 356.215 and 356.216 deleted text end , the commissioner shall allocate that deleted text begin 34.2 deleted text end new text begin 47.1 new text end percent
of the aid as follows: 49 percent to the Teachers Retirement Association, 21 percent
to the St. Paul Teachers Retirement Fund Association, and 30 percent as additional
funding to support minimum fire state aid for volunteer firefighters relief associations. If
there is no deleted text begin unfunded actuarial accrued liability in deleted text end new text begin employer contribution by new text end the new text begin city of
new text end Virginia deleted text begin Fire Department Relief Association as disclosed in the most recent actuarial
valuation for the relief association prepared under sections 356.215 and 356.216 deleted text end new text begin under
section 353.665, subdivision 8, paragraph (d), for the former Virginia Fire Department
Relief Association certified on or before June 30 by the executive director of the Public
Employees Retirement Association new text end , the commissioner shall allocate that 1.3 percent
of the aid as follows: 49 percent to the Teachers Retirement Association, 21 percent
to the St. Paul Teachers Retirement Fund Association, and 30 percent as additional
funding to support minimum fire state aid for volunteer firefighters relief associations.
deleted text begin Upon the final payment to municipalities required by section 353.665, subdivision 8,
paragraph (b), or 353A.09, subdivision 5, paragraph (b), the commissioner shall allocate
that 64.5 percent of the aid as follows: 20 percent to the St. Paul Teachers Retirement
Fund Association, 20 percent to the city of Minneapolis to fund any unfunded actuarial
accrued liability in the actuarial valuation proposed under sections 356.215 and 356.216
as of the preceding December 31 for the Minneapolis Police Relief Association or the
Minneapolis Firefighters Relief Association, 20 percent for the city of Duluth to pay for
any costs associated with the police and firefighters pensions, and 40 percent as additional
funding to support minimum fire state aid for volunteer firefighters relief associations.
deleted text end

new text begin (b) new text end The allocation must be made by the commissioner deleted text begin at the same time and under the
same procedures as specified in subdivision 3 deleted text end new text begin of revenue on October 1 annually new text end .

new text begin (c) new text end With respect to the St. Paul Teachers Retirement Fund Association, annually,
deleted text begin beginning on July 1, 2005, deleted text end if the deleted text begin applicable deleted text end teacher's association five-year average
time-weighted rate of investment return does not equal or exceed the performance of a
composite portfolio assumed passively managed (indexed) invested ten percent in cash
equivalents, 60 percent in bonds and similar debt securities, and 30 percent in domestic
stock calculated using the formula under section 11A.04, clause (11), the aid allocation
to deleted text begin that deleted text end new text begin the new text end retirement fund under this section ceases until the five-year annual rate of
investment return equals or exceeds the performance of that composite portfolio.

(d) The amounts required under this subdivision are the amounts annually
appropriated to the commissioner of revenue under section 69.021, subdivision 11,
paragraph (e) new text begin , and the aid amounts in excess of the limitation in subdivision 4 new text end .

Sec. 72.

Minnesota Statutes 2012, section 423A.02, subdivision 2, is amended to read:

Subd. 2.

Continued eligibility.

A municipality that deleted text begin has qualified for amortization
state aid under subdivision 1 on December 31, 1984, and has an additional municipal
contribution payable under section 353A.09, subdivision 5, paragraph (b), as of the most
recent December 31, continues upon application to be entitled to receive amortization
state aid under subdivision 1 and supplementary amortization state aid under subdivision
1a, after the local police or salaried firefighters' relief association has been consolidated
into the public employees police and fire fund. If a municipality loses entitlement for
amortization state aid and supplementary amortization state aid in any year because of
not having an additional municipal contribution under section 353A.09, subdivision 5,
paragraph (b), the municipality is not entitled to the aid amounts in any subsequent year. A
municipality that received amortization aid in 1999 and is required to make an additional
municipal contribution under section 353.665, subdivision 8, continues to qualify for the
amortization state aid and the supplemental amortization aid until December 31, 2009
deleted text end new text begin received amortization aid in 2011 and is required to make a municipal contribution under
section 353.665, subdivision 8, paragraph (b), (c), or (d), whichever applies, continues to
qualify for amortization state aid for the duration of the applicable municipal contribution new text end .

Sec. 73.

Minnesota Statutes 2012, section 423A.02, subdivision 3, is amended to read:

Subd. 3.

Reallocation of amortization deleted text begin or supplementary amortization deleted text end state
aid.

(a) Seventy percent of the difference between $5,720,000 and the current year
amortization aid deleted text begin and supplemental amortization aid deleted text end distributed under subdivisions 1
and 1a that is not distributed for any reason to a municipality deleted text begin for use by a local police
or salaried fire relief association deleted text end must be distributed by the commissioner of revenue
according to this paragraph. The commissioner shall distribute 50 percent of the amounts
derived under this paragraph to the Teachers Retirement Association, ten percent to the
Duluth Teachers Retirement Fund Association, and 40 percent to the St. Paul Teachers
Retirement Fund Association to fund the unfunded actuarial accrued liabilities of the
respective funds. These payments deleted text begin shall deleted text end new text begin must new text end be made on deleted text begin or before June 30 deleted text end new text begin July 15 new text end each
fiscal year. If the St. Paul Teachers Retirement Fund Association new text begin or if the Duluth Teachers
Retirement Fund Association new text end becomes fully funded, deleted text begin its deleted text end new text begin the association's new text end eligibility for new text begin its
portion of new text end this aid ceases. Amounts remaining in the undistributed balance account at the
end of the biennium if aid eligibility ceases cancel to the general fund.

(b) In order to receive amortization and supplementary amortization aid under
paragraph (a), deleted text begin prior to deleted text end new text begin before new text end June 30 new text begin annually new text end Independent School District No. 625, St.
Paul, must make an additional contribution of $800,000 each year to the St. Paul Teachers
Retirement Fund Association.

(c) Thirty percent of the difference between $5,720,000 and the current year
amortization aid deleted text begin and supplemental amortization aid deleted text end under subdivisions 1 and 1a that is not
distributed for any reason to a municipality deleted text begin for use by a local police or salaried firefighter
relief association deleted text end must be distributed under section 69.021, subdivision 7, paragraph (d),
as additional funding to support a minimum fire state aid amount for volunteer firefighter
relief associations.

Sec. 74.

Minnesota Statutes 2012, section 423A.02, subdivision 3a, is amended to read:

Subd. 3a.

Appropriations for amortization state aid deleted text begin ; supplementary
amortization state aid; deleted text end and amortization state aid deleted text begin and supplementary state aid
deleted text end reallocations.

deleted text begin $4,720,000 deleted text end new text begin $5,720,000 new text end is annually appropriated from the general fund to
the commissioner of revenue for amortization state aid under subdivision 1, and for the
reallocation of amortization aid under subdivision 3. deleted text begin $1,000,000 is annually appropriated
from the general fund to the commissioner of revenue for supplementary amortization
state aid under subdivision 1a, and for the reallocation of supplementary amortization state
aid under subdivision 3.
deleted text end

Sec. 75.

Minnesota Statutes 2012, section 423A.02, subdivision 4, is amended to read:

Subd. 4.

Limit on certain total aid amounts.

(a) The total of amortization aid deleted text begin ,
supplemental amortization aid, deleted text end and additional amortization aid under this section payable
to a municipality to which section 353.665, subdivision 8, paragraph (b), new text begin (c), or (d),
new text end applies, may not exceed the amount of the additional municipal contribution payable by
an individual municipality under section 353.665, subdivision 8, paragraph (b) new text begin , (c), or (d) new text end .

(b) Any aid amount in excess of the limit under this subdivision for an individual
municipality must be redistributed to the other municipalities to which section 353.665,
subdivision 8, paragraph (b), new text begin (c), or (d), new text end applies. The excess aid must be distributed in
proportion to each municipality's additional municipal contribution under section 353.665,
subdivision 8, paragraph (b) new text begin , (c), or (d) new text end .

(c) When the total aid for each municipality under this section equals the limit under
paragraph (a), any aid in excess of the limit must be redistributed under subdivision 1b.

Sec. 76.

Minnesota Statutes 2012, section 423A.02, subdivision 5, is amended to read:

Subd. 5.

Termination of state aid programs.

The amortization state aid deleted text begin ,
supplemental amortization state aid, deleted text end and additional amortization state aid programs
terminate as of the December 31, next following the date of the actuarial valuation when
the assets of the St. Paul Teachers Retirement Fund Association equal the actuarial
accrued liability of that plan or deleted text begin December 31, 2009 deleted text end new text begin when the assets of the Duluth Teachers
Retirement Fund Association equal the actuarial accrued liability of that plan new text end , whichever
is later.

Sec. 77.

Minnesota Statutes 2012, section 424A.001, subdivision 4, is amended to read:

Subd. 4.

Relief association.

(a) "Relief association" or "volunteer firefighters' relief
association" means a volunteer firefighters' relief association or a volunteer firefighters'
division or account of a partially salaried and partially volunteer firefighters' relief
association that is:

(1) organized and incorporated as a nonprofit corporation to provide retirement
benefits to volunteer firefighters under chapter 317A and any laws of the state;

(2) governed by this chapter and sections 69.771 to 69.775; and

(3) directly associated with:

(i) a fire department established by municipal ordinance;

(ii) an independent nonprofit firefighting corporation that is organized under the
provisions of chapter 317A and that operates primarily for firefighting purposes; or

(iii) a fire department operated as or by a joint powers entity that operates primarily
for firefighting purposes.

(b) "Relief association" or "volunteer firefighters' relief association" does not mean:

(1) the Bloomington Fire Department Relief Association governed by deleted text begin section 69.77
deleted text end new text begin sections 31 to 43 new text end ; Minnesota Statutes 2000, chapter 424; and Laws 1965, chapter 446,
as amended; or

(2) the voluntary statewide lump-sum volunteer firefighter retirement plan governed
by chapter 353G.

(c) A relief association or volunteer firefighters' relief association is a governmental
entity that receives and manages public money to provide retirement benefits for individuals
providing the governmental services of firefighting and emergency first response.

Sec. 78.

Minnesota Statutes 2012, section 424A.02, subdivision 9, is amended to read:

Subd. 9.

Limitation on ancillary benefits.

A defined benefit relief association,
including any volunteer firefighters relief association governed by deleted text begin section 69.77 deleted text end new text begin sections
31 to 43 new text end or any volunteer firefighters division of a relief association governed by chapter
424, may only pay ancillary benefits which would constitute an authorized disbursement
as specified in section 424A.05 subject to the following requirements or limitations:

(1) with respect to a defined benefit relief association in which governing bylaws
provide solely for a lump-sum service pension to a retiring member, or provide a retiring
member the choice of either a lump-sum service pension or a monthly service pension
and the lump-sum service pension was chosen, no ancillary benefit may be paid to any
former member or paid to any person on behalf of any former member after the former
member (i) terminates active service with the fire department and active membership
in the relief association; and (ii) commences receipt of a service pension as authorized
under this section; and

(2) with respect to any defined benefit relief association, no ancillary benefit paid or
payable to any member, to any former member, or to any person on behalf of any member
or former member, may exceed in amount the total earned service pension of the member
or former member. The total earned service pension must be calculated by multiplying
the service pension amount specified in the bylaws of the relief association at the time of
death or disability, whichever applies, by the years of service credited to the member or
former member. The years of service must be determined as of (i) the date the member or
former member became entitled to the ancillary benefit; or (ii) the date the member or
former member died entitling a survivor or the estate of the member or former member to
an ancillary benefit. The ancillary benefit must be calculated without regard to whether the
member had attained the minimum amount of service and membership credit specified in
the governing bylaws. For active members, the amount of a permanent disability benefit
or a survivor benefit must be equal to the member's total earned service pension except
that the bylaws of a defined benefit relief association may provide for the payment of a
survivor benefit in an amount not to exceed five times the yearly service pension amount
specified in the bylaws on behalf of any member who dies before having performed five
years of active service in the fire department with which the relief association is affiliated.

(3)(i) If a lump sum survivor or death benefit is payable under the articles of
incorporation or bylaws, the benefit must be paid:

(A) as a survivor benefit to the surviving spouse of the deceased firefighter;

(B) as a survivor benefit to the surviving children of the deceased firefighter if
no surviving spouse;

(C) as a survivor benefit to a designated beneficiary of the deceased firefighter if no
surviving spouse or surviving children; or

(D) as a death benefit to the estate of the deceased active or deferred firefighter if no
surviving children and no beneficiary designated.

(ii) If there are no surviving children, the surviving spouse may waive, in writing,
wholly or partially, the spouse's entitlement to a survivor benefit.

(4)(i) If a monthly benefit survivor or death benefit is payable under the articles of
incorporation or bylaws, the benefit must be paid:

(A) as a survivor benefit to the surviving spouse of the deceased firefighter;

(B) as a survivor benefit to the surviving children of the deceased firefighter if
no surviving spouse;

(C) as a survivor benefit to a designated beneficiary of the deceased firefighter if no
surviving spouse or surviving children; or

(D) as a death benefit to the estate of the deceased active or deferred firefighter if no
surviving spouse, no surviving children, and no beneficiary designated.

(ii) If there are no surviving children, the surviving spouse may waive, in writing,
wholly or partially, the spouse's entitlement to a survivor benefit.

(iii) For purposes of this clause, if the relief association bylaws authorize a monthly
survivor benefit payable to a designated beneficiary, the relief association bylaws may
limit the total survivor benefit amount payable.

(5) For purposes of this section, for a monthly benefit volunteer fire relief association
or for a combination lump-sum and monthly benefit volunteer fire relief association where
a monthly benefit service pension has been elected by or a monthly benefit is payable with
respect to a firefighter, a designated beneficiary must be a natural person. For purposes
of this section, for a lump-sum volunteer fire relief association or for a combination
lump-sum and monthly benefit volunteer fire relief association where a lump-sum service
pension has been elected by or a lump-sum benefit is payable with respect to a firefighter,
a trust created under chapter 501B may be a designated beneficiary. If a trust is payable to
the surviving children organized under chapter 501B as authorized by this section and
there is no surviving spouse, the survivor benefit may be paid to the trust, notwithstanding
a requirement of this section to the contrary.

Sec. 79.

Minnesota Statutes 2012, section 475.52, subdivision 6, is amended to read:

Subd. 6.

Certain purposes.

Any municipality may issue bonds for paying
judgments against it; for refunding outstanding bonds; for funding floating indebtedness;
for funding actuarial liabilities to pay postemployment benefits to employees or officers
after their termination of service; or for funding all or part of the municipality's current
and future unfunded liability for a pension or retirement fund or plan referred to in
section 356.20, subdivision 2, as those liabilities are most recently computed under
sections 356.215 and 356.216. The board of trustees or directors of deleted text begin a deleted text end new text begin the Bloomington
Fire Department new text end Relief Association deleted text begin referred to in section 69.77 deleted text end must consent and must
be a party to any contract made under this section with respect to the fund held by it
for the benefit of and in trust for its members. For purposes of this section, the term
"postemployment benefits" means benefits giving rise to a liability under Statement No.
45 of the Governmental Accounting Standards Board.

Sec. 80. new text begin REVISOR'S INSTRUCTION.
new text end

new text begin The revisor of statutes shall not show the text of Minnesota Statutes, section 69.77,
and add the note in Minnesota Statutes, section 69.77, "CITY OF BLOOMINGTON;
LOCAL."
new text end

Sec. 81. new text begin REPEALER.
new text end

new text begin (a) new text end new text begin Minnesota Statutes 2012, section 353.665, subdivisions 2, 3, 4, 6, 7, 9, and
10, new text end new text begin are repealed.
new text end

new text begin (b) new text end new text begin Minnesota Statutes 2012, sections 353.667; 353.668; 353.669; and 353.6691, new text end new text begin are
repealed.
new text end

new text begin (c) new text end new text begin Minnesota Statutes 2012, sections 353A.01; 353A.02; 353A.03; 353A.04;
353A.05; 353A.06; 353A.07; 353A.08; 353A.081; 353A.083; 353A.09; 353A.10;
353B.01; 353B.02; 353B.03; 353B.04; 353B.05; 353B.06; 353B.07; 353B.08; 353B.09;
353B.10; 353B.11; 353B.12; 353B.13; and 353B.14, new text end new text begin are repealed.
new text end

new text begin (d) new text end new text begin Minnesota Statutes 2012, sections 423A.01; 423A.04; 423A.05; 423A.07;
423A.10; 423A.11; 423A.12; 423A.13; 423A.14; 423A.15; 423A.16; 423A.17; 423A.171;
423A.18; 423A.19; 423A.20; 423A.21; and 423A.22, new text end new text begin are repealed.
new text end

new text begin (e) new text end new text begin Minnesota Statutes 2012, sections 69.021, subdivision 6; 353.64, subdivision 3;
and 423A.02, subdivision 1a, new text end new text begin are repealed.
new text end

Sec. 82. new text begin EFFECTIVE DATE; PRIOR AID ALLOCATIONS VALIDATED.
new text end

new text begin (a) Sections 70 to 76 are effective June 1, 2013.
new text end

new text begin (b) Except as provided in paragraph (c), sections 1 to 69 and 77 to 82 are effective
July 1, 2013.
new text end

new text begin (c) With respect to the city of Minneapolis, section 18 is effective retroactively from
July 20, 2011, and with respect to the city of Fairmont, section 18 is effective retroactively
from May 10, 2012.
new text end

new text begin (d) Allocations of amortization state aid, supplementary amortization state aid, or
additional amortization state aid made by the commissioner of revenue before January 1,
2013, are hereby validated.
new text end