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Key: (1) language to be deleted (2) new language


  

                         Laws of Minnesota 1983 

                        CHAPTER 219--S.F.No. 160
           An act relating to retirement; volunteer firefighters' 
          relief associations; adding definitions; providing for 
          distribution of assets upon dissolution; clarifying 
          ambiguous language; amending Minnesota Statutes 1982, 
          sections 69.772, subdivisions 1, 2, and 3; 424A.01; 
          424A.02; 424A.03, subdivision 1; 424A.04; 424A.05; and 
          424A.08; proposing new law coded in Minnesota 
          Statutes, chapter 424A; repealing Minnesota Statutes 
          1982, section 424.26. 
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
    Section 1.  Minnesota Statutes 1982, section 69.772, 
subdivision 1, is amended to read:  
    Subdivision 1.  [APPLICATION.] This section shall apply to 
any firefighter's relief association specified in section 
69.771, subdivision 1, which pays a lump sum service pension, 
but which does not pay a monthly service pension, to a retiring 
firefighter when at least the minimum requirements for 
entitlement to a service pension specified in section 424A.02, 
or any applicable special legislation and the articles of 
incorporation or bylaws of the relief association have been 
met.  Each firefighter's relief association to which this 
section applies shall determine the accrued liability of the 
special fund of the relief association in accordance with the 
applicable accrued liability table set forth in subdivision 2 
and the financial requirements of the relief association and the 
minimum obligation of the municipality in accordance with the 
procedure set forth in subdivision 3. 
    Sec. 2.  Minnesota Statutes 1982, section 69.772, 
subdivision 2, is amended to read: 
    Subd. 2.  [DETERMINATION OF ACCRUED LIABILITY.] Each 
firefighters' relief association which pays a service pension 
when a retiring firefighter meets the minimum requirements for 
entitlement to a service pension specified in section 424A.02 
and which in its articles of incorporation or bylaws requires 
service credit for a period of service less than 20 years of 
active service for a totally nonforfeitable service pension as 
provided in section 424A.09 shall determine the accrued 
liability of the special fund of the firefighters' relief 
association relative to each active or deferred member of the 
relief association, calculated individually using the following 
table:  
             Cumulative                    Accrued
              Year                       Liability
           .............                 ............
                1                             $35
                2                              71
                3                             110
                4                             150
                5                             192
                6                             236
                7                             283
                8                             332
                9                             383
               10                             437
               11                             494
               12                             553
               13                             616
               14                             681
               15                             750
               16 and thereafter      50 additional per
                                            year
    Each firefighters' relief association which pays a service 
pension when a retiring firefighter meets the minimum 
requirements for entitlement to a service pension specified in 
section 424A.02 and which in its articles of incorporation or 
bylaws requires service credit for a period of service of at 
least 20 years of active service for a totally nonforfeitable 
service pension shall determine the accrued liability of the 
special fund of the firefighters' relief association relative to 
each active or deferred member of the relief association, 
calculated individually using the following table: 
          Cumulative                      Accrued
           Year                         Liability
         .............                  .............
              1                              $30    60 
              2                               62   124 
              3                               95   190 
              4                              130   260 
              5                              167   334 
              6                              205   410 
              7                              246   492 
              8                              288   576 
              9                              333   666 
             10                              380   760 
             11                              429   858 
             12                              481   962 
             13                              535  1070 
             14                              592  1184 
             15                              652  1304 
             16                              714  1428 
             17                              780  1560 
             18                              849  1698 
             19                              922  1844 
             20                             1000  2000 
             21 and thereafter                50   100 additional
                                                       per year
    The accrued liability of the special fund for each active 
or deferred member of the relief association shall be determined 
as the multiple or portion of the accrued liability amounts 
corresponding to the cumulative years of active service with the 
fire department to which the relief association is affiliated to 
the credit of the member as set forth in the applicable table 
that the lump sum service pension amount currently provided for 
in the articles of incorporation or the bylaws of the relief 
association bears to a lump sum service pension of $50 per year 
of service As set forth in the table the accrued liability for 
each member or deferred member of the relief association 
corresponds to the cumulative years of active service to the 
credit of the member.  The accrued liability of the special fund 
for each active or deferred member is determined by multiplying 
the accrued liability from the chart by the ratio of the lump 
sum service pension amount currently provided for in the bylaws 
of the relief association to a service pension of $100 per year 
of service.  If a member has fractional service as of December 
31, the figure for service credit to be used for the 
determination of accrued liability pursuant to this section 
shall be rounded up to the nearest full year of service credit.  
The total accrued liability of the special fund of the relief 
association as of December 31 shall be the sum of the accrued 
liability attributable to each active or deferred member of the 
relief association. 
    Sec. 3.  Minnesota Statutes 1982, section 69.772, 
subdivision 3, is amended to read:  
    Subd. 3.  [FINANCIAL REQUIREMENTS OF THE RELIEF 
ASSOCIATION; MINIMUM OBLIGATION OF THE MUNICIPALITY.] During the 
month of July, the officers of the relief association shall 
determine the overall funding balance of the special fund of the 
relief association for the current calendar year, the financial 
requirements of the special fund of the relief association for 
the following calendar year and the minimum obligation of the 
municipality with respect to the special fund of the relief 
association for the following calendar year in accordance with 
the requirements of this subdivision.  
    (1) The overall funding balance of the special fund of the 
relief association for the current calendar year shall be 
determined in the following manner: 
    (a) The total accrued liability of the special fund of the 
relief association for all active and deferred members of the 
relief association as of December 31 of the current year shall 
be calculated pursuant to subdivisions 2 and 2a, if applicable. 
    (b) The total present assets of the special fund of the 
relief association projected to December 31 of the current year, 
including receipts by and disbursements from the special fund 
anticipated to occur on or before December 31 shall be 
calculated.  
    (c) The amount of the total present assets of the special 
fund of the relief association calculated pursuant to clause (b) 
shall be subtracted from the amount of the total accrued 
liability of the special fund of the relief association 
calculated pursuant to clause (a).  If the amount of total 
present assets exceeds the amount of the total accrued 
liability, then the special fund shall be considered to have a 
surplus over full funding.  If the amount of the total present 
assets is less than the amount of the total accrued liability, 
then the special fund shall be considered to have a deficit from 
full funding.  If the amount of total present assets is equal to 
the amount of the total accrued liability, then the special fund 
shall be considered to be fully funded. 
    (2) The financial requirements of the special fund of the 
relief association for the following calendar year shall be 
determined in the following manner: 
    (a) The total accrued liability of the special fund of the 
relief association for all active and deferred members of the 
relief association as of December 31 of the calendar year next 
following the current calendar year shall be calculated pursuant 
to subdivisions 2 and 2a, if applicable. 
    (b) The increase or decrease in the total accrued liability 
of the special fund of the relief association for the following 
calendar year over the total accrued liability of the special 
fund of the relief association for the current year shall be 
calculated. 
    (c) If the special fund of the relief association is fully 
funded, the financial requirement of the special fund for the 
following calendar year shall be either the positive or the 
negative figure which represents the increase or the decrease in 
the total accrued liability of the special fund respectively as 
calculated pursuant to subclause (b).  
    (d) If the special fund of the relief association has a 
deficit from full funding, the financial requirements of the 
special fund for the following calendar year shall be the 
financial requirements of the special fund calculated as though 
the special fund were fully funded pursuant to subclause (c) 
plus an amount equal to one-tenth of the amount of the deficit 
from full funding of the special fund as determined pursuant to 
this section for the calendar year 1971 until that deficit is 
fully retired, and plus an amount equal to one-tenth of the 
increase in the deficit from full funding of the special fund 
resulting from an increase in the amount of the service pension 
accruing subsequent to December 31, 1971 until each increase in 
the deficit is fully retired. 
    (e) If the special fund of the relief association has a 
surplus over full funding, the financial requirements of the 
special fund for the following calendar year shall be the 
financial requirements of the special fund calculated as though 
the special fund were fully funded pursuant to subclause (c) 
reduced by an amount equal to one-tenth of the amount of the 
surplus over full funding of the special fund. 
    (3) The minimum obligation of the municipality with respect 
to the special fund of the relief association shall be the 
financial requirements of the special fund of the relief 
association reduced by the amount of any fire state aid payable 
pursuant to sections 69.011 to 69.051 anticipated to be received 
by the municipality for transmittal to the special fund of the 
relief association during the following calendar year, an amount 
of interest on the assets of the special fund projected to the 
end of the current beginning of the following calendar year 
calculated at the rate of five percent per annum, and the amount 
of any anticipated contributions to the special fund by the 
members of the relief association during the following calendar 
year. 
    Sec. 4.  [424A.001] [DEFINITIONS.] 
    Subdivision 1.  [TERMS DEFINED.] As used in chapter 424A, 
the terms defined in this section have the meanings given.  
    Subd. 2.  [FIRE DEPARTMENT.] "Fire department" includes 
municipal fire department and independent nonprofit firefighting 
corporation.  
    Subd. 3.  [MUNICIPALITY.] "Municipality" means a 
municipality which has a fire department with which the relief 
association is directly associated, or the municipalities which 
contract with the independent nonprofit firefighting corporation 
of which the relief association is a subsidiary.  
     Subd. 4.  [RELIEF ASSOCIATION.] "Relief association" means 
(a) a volunteer firefighters' relief association or volunteer 
firefighters' division or account of a partially salaried and 
partially volunteer firefighters' relief association organized 
and incorporated under chapter 317 and any laws of the state, 
governed by chapters 69 and 424A, and directly associated with a 
fire department established by municipal ordinance; or (b) any 
separate incorporated volunteer firefighters' relief association 
subsidiary to and providing service pension and retirement 
benefit coverage for members of an independent nonprofit 
firefighting corporation organized under the provisions of 
chapter 317, governed by chapter 424A, and operating exclusively 
for firefighting purposes.  
    Subd. 5.  [SPECIAL FUND.] "Special fund" means special fund 
of a volunteer firefighters' relief association or the account 
for volunteer firefighters within the special fund of a 
partially salaried and partially volunteer firefighters' relief 
association.  
    Subd. 6.  [SURVIVING SPOUSE.] For purposes of this chapter, 
and the governing bylaws of any relief association to which this 
chapter applies, the term "surviving spouse" means any person 
who was the dependent spouse of a deceased active member or 
retired former member living with the member at the time of the 
death of the active member or retired former member for at least 
one year prior to the date on which the member terminated active 
service and membership.  
    Sec. 5.  Minnesota Statutes 1982, section 424A.01, is 
amended to read: 
    424A.01 [MEMBERSHIP IN A VOLUNTEER FIREFIGHTERS' RELIEF 
ASSOCIATION.] 
    Subdivision 1.  [MINORS.] It is unlawful for any 
municipality or independent nonprofit firefighting corporation 
to employ a minor as a volunteer firefighter or to permit a 
minor to serve in any capacity performing any firefighting 
duties with a volunteer fire department.  
    Subd. 2.  [STATUS OF SUBSTITUTE OR PROBATIONARY VOLUNTEER 
FIREFIGHTERS.] No person who is serving as a substitute or a 
probationary volunteer firefighter shall be deemed to be a 
firefighter for purposes of chapter 69 or this chapter nor shall 
be authorized to be a member of any volunteer firefighters' 
relief association governed by chapter 69 or this chapter.  
    Subd. 3.  [STATUS OF NONMEMBER VOLUNTEER FIREFIGHTERS.] No 
person who is serving as a firefighter in a municipal fire 
department or an independent nonprofit firefighting corporation 
but who is not a member of the applicable firefighters' relief 
association shall be entitled to any service pension, retirement 
or ancillary benefits or pension or retirement benefit coverage 
from the relief association.  
    Subd. 3a.  [SERVICE CREDIT FOR CERTAIN PROBATIONARY 
VOLUNTEER FIREFIGHTERS.] Unless the bylaws of the volunteer 
firefighters relief association clearly provide to the contrary, 
any person:  
    (a) who has served as a probationary volunteer firefighter 
with a municipal fire department to with which a volunteer 
firefighters relief association governed by chapter 69 and this 
chapter is directly associated or with an independent nonprofit 
firefighting corporation to which a volunteer firefighters 
relief association governed by chapter 69 and this chapter is 
subsidiary; and 
    (b) who is a member of that volunteer firefighters relief 
association;  
    shall be is entitled to have the period of service as a 
probationary volunteer firefighter credited as a period of 
active service as an active member of the municipal fire 
department or the independent nonprofit firefighting 
corporation, whichever is applicable, for purposes of 
calculating a service pension or other retirement ancillary 
benefits.  
    Subd. 4.  [EXCLUSION OF PERSONS CONSTITUTING AN UNWARRANTED 
HEALTH RISK.] The board of trustees of every volunteer 
firefighters' relief association governed by chapter 69 or this 
chapter shall have the right to may exclude from membership in 
the relief association all applicants who, due to some medically 
determinable physical or mental impairment or condition, would 
constitute for the relief association a predictable and 
unwarranted risk of the commencement of a retirement imposing 
liability for an ancillary benefit at any age earlier than the 
minimum age specified for receipt of a service pension.  
Notwithstanding any provision of section 363.02, subdivision 5, 
it shall be a good and valid defense to a complaint or action 
brought under chapter 363 that the board of trustees of the 
relief association made a good faith determination that the 
applicant suffers from an impairment or condition constituting a 
predictable and unwarranted risk for the relief association if 
the determination was made following consideration of:  (a) the 
person's medical history; and (b) the report of the physician 
completing a physical examination of the applicant completed at 
the expense of the relief association and of the person's 
medical history. 
    Sec. 6.  Minnesota Statutes 1982, section 424A.02, is 
amended to read: 
    424A.02 [VOLUNTEER FIREFIGHTERS; SERVICE PENSIONS.] 
    Subdivision 1.  [AUTHORIZATION.] Any volunteer 
firefighters' relief association or volunteer firefighters' 
division or account of a partially salaried and partially 
volunteer firefighters' relief association organized and 
incorporated under chapter 317 and any laws of the state and 
directly associated with a fire department established by 
municipal ordinance or any separate incorporated volunteer 
firefighters' relief association subsidiary to and providing 
service pension and retirement benefit coverage for members of 
an independent nonprofit firefighting corporation organized 
under the provisions of chapter 317 and operating exclusively 
for fire fighting purposes, whether or not the nonprofit 
firefighting corporation qualifies for fire state aid pursuant 
to chapter 69, when its articles of incorporation or bylaws so 
provide, may pay out of the assets of the its special fund of 
the volunteer firefighters' relief association or volunteer 
firefighters' account, a service pension to each of its members 
who:  (1) separates from active service with the fire department 
or the independent nonprofit firefighting corporation, who; (2) 
reaches the age of 50 years and who; (3) completes at least ten 
years of active service as an active member of the municipal 
fire department to which the relief association is associated or 
of the independent nonprofit firefighting corporation to which 
the relief association is subsidiary, and who; (4) completes at 
least ten years of active membership with the volunteer 
firefighters' relief association or volunteer firefighters' 
account prior to separation from active service; and who (5) 
complies with any additional conditions as to age, service and 
membership which are prescribed by the bylaws of the relief 
association.  The service pension may be paid whether or not the 
municipality or nonprofit firefighting corporation to which the 
relief association is associated qualifies for fire state aid 
under chapter 69.  In the case of a member who has completed at 
least ten years of active service as an active member of the 
municipal fire department to which the relief association is 
associated or of the independent nonprofit firefighting 
corporation to which the relief association is subsidiary on the 
date that the volunteer firefighters' relief association is 
established and incorporated, the requirement that the member 
complete at least ten years of active membership with the 
volunteer firefighters' relief association or volunteer 
firefighters' account prior to separation from active service 
may be waived by the board of trustees of the relief association 
if the member completes at least ten years of inactive 
membership with the volunteer firefighters' relief association 
or volunteer firefighters' account prior to the payment of the 
service pension.  During the period of inactive membership, the 
member shall not be entitled to receive any disability benefit 
coverage, shall not be entitled to receive any additional 
service credit towards computation of a service pension, and 
shall be deemed to have the status of a person entitled to a 
deferred service pension pursuant to subdivision 7. 
    No municipality or nonprofit firefighting corporation is 
authorized to delegate the power to take final action in setting 
a service pension or retirement ancillary benefit amount or 
level to the board of trustees of the volunteer firefighters 
relief association or to approve in advance a service pension or 
retirement ancillary benefit amount or level equal to the 
maximum amount or level which this chapter would allow rather 
than a specific dollar amount or level.  
    No volunteer firefighters' relief association or volunteer 
firefighters' division or account of a partially salaried and 
partially volunteer firefighters' relief association is 
authorized to as defined in section 424A.001, subdivision 4, 
shall pay a service pension or disability benefit to any former 
member of the relief association if that person has not 
separated from active service with the fire department to which 
the volunteer firefighters' relief association is directly 
associated or with the independent nonprofit firefighting 
corporation to which the volunteer firefighters' relief 
association is subsidiary.  
    Subd. 2.  [NONFORFEITABLE PORTION OF SERVICE PENSION.] Any 
volunteer firefighters' relief association or volunteer 
firefighters' account to which this section applies, when its 
articles of incorporation or bylaws so provide and when a 
retiring member meets the minimum age and service requirements 
set forth in subdivision 1 but has not completed 20 years of 
service may pay a portion of the service pension amount earned 
to date as specified in the bylaws, but not to exceed the 
percentage applicable for each full year of service completed as 
follows:  
  Completed Years of Service   Nonforfeitable Portion of
                                Annual or Prorata Service
                                      Pension Amount  
    If the articles of incorporation or bylaws of a relief 
association so provide, a relief association may pay a reduced 
service pension to a retiring member who has completed fewer 
than 20 years of service.  The reduced service pension may be 
paid when the retiring member meets the minimum age and service 
requirements of subdivision 1.  
    The amount of the reduced service pension shall not exceed 
the amount calculated by multiplying the service pension 
appropriate for the completed years of service as specified in 
the bylaws times the applicable nonforfeitable percentage of 
pension.  The applicable nonforfeitable percentage of pension 
amounts are as follows:  
  Completed Years of Service   Nonforfeitable Percentage
                                   of Pension Amount
        10                              60 percent 
        11                              64 percent  
        12                              68 percent  
        13                              72 percent  
        14                              76 percent  
        15                              80 percent 
        16                              84 percent 
        17                              88 percent 
        18                              92 percent 
        19                              96 percent 
        20 and thereafter              100 percent 
    Subd. 3.  [FLEXIBLE SERVICE PENSION MAXIMUMS.] On or before 
August 1 of each year as part of the certification of the 
financial requirements and minimum municipal obligation made 
pursuant to section 69.772, subdivision 4, or 69.773, 
subdivision 5, the secretary or some other official of the 
relief association designated in the bylaws of each volunteer 
firefighters' relief association or volunteer firefighters' 
account, other than a relief association or account which in its 
bylaws provides solely for the payment of a defined contribution 
service pension as authorized pursuant to subdivision 4, shall 
calculate and certify to the governing body of the applicable 
qualified municipality the average amount of available financing 
per active covered firefighter for the most recent three-year 
period.  The amount of available financing shall include any 
amounts of fire state aid received or receivable by the relief 
association or account, any amounts of municipal contributions 
to the relief association or account raised from levies on real 
estate or from other available revenue sources exclusive of fire 
state aid, and one-tenth of the amount of assets in excess of 
the accrued liabilities of the relief association or account 
calculated pursuant to sections 69.772, subdivision 2; 69.773, 
subdivisions 2 and 4; or 69.774, subdivision 2, if any.  The 
maximum service pension which the relief association may provide 
for in its bylaws for payment to a member retiring after the 
calculation date when the minimum age and service requirements 
specified in subdivision 1 are met shall be determined using the 
applicable following table. 
    For a relief association or account where the governing 
bylaws provide for a monthly service pension to a retiring 
member, if the average amount of available financing per active 
covered firefighter does not exceed the minimum average amount 
specified below, then the maximum monthly service pension amount 
per month for each year of service credited which may be 
provided for in the bylaws shall be the greater of:  (1) the 
service pension amount provided for in the bylaws on the date of 
calculation; or (2) the maximum service pension figure 
corresponding to the average amount of available financing per 
active covered firefighter: 
   Minimum Average Amount of      Maximum Service Pension
  Available Financing per        Amount Payable per Month
       Firefighter               for Each Year of Service
         $...                             $ .25
           37                               .50
           75                              1.00
          112                              1.50
          149                              2.00
          186                              2.50
          224                              3.00
          261                              3.50
          298                              4.00
          336                              4.50
          373                              5.00
          447                              6.00
          522                              7.00
          597                              8.00
          671                              9.00
          746                             10.00
          820                             11.00
          895                             12.00
          969                             13.00
         1044                             14.00
         1119                             15.00
         1193                             16.00
         1268                             17.00
         1342                             18.00
         1417                             19.00
         1491                             20.00
         1566                             21.00
         1640                             22.00
         1678 or more                     22.50
    For a relief association or account in which the governing 
bylaws provide for a lump sum service pension to a retiring 
member, if the average amount of available financing per active 
covered firefighter does not exceed the minimum average amount 
specified below, then the maximum lump sum service pension 
amount for each year of service credited which may be provided 
for in the bylaws shall be the greater of:  (1) the service 
pension amount provided for in the bylaws on the date of the 
calculation; or (2) the maximum service pension figure 
corresponding to the average amount of available financing per 
active covered firefighter: 
  Minimum Average Amount         Maximum Lump Sum Service
 of Available Financing         Pension Amount Payable
    per Firefighter             for Each Year of Service
         $..                            $10
          10                             20
          14                             30
          20                             40
          24                             50
          28                             60
          38                             80
          48                            100
          58                            120
          68                            140
          76                            160
          86                            180
          96                            200
         116                            240
         134                            280
         154                            320
         172                            360
         192                            400
         212                            440
         230                            480
         250                            520
         268                            560
         288                            600
         308                            640
         326                            680
         346                            720
         364                            760
         384                            800
         432                            900
         480                           1000
         528                           1100
         576                           1200
         624                           1300
         672                           1400
         720                           1500
         768                           1600
         816                           1700
         864                           1800
         912                           1900
         960                           2000
        1008                           2100
        1056                           2200
        1104                           2300
        1152                           2400
        1200                           2500
        1248                           2600
        1296                           2700
        1344                           2800
        1392                           2900
        1440 or more                   3000
    For a relief association or account in which the governing 
bylaws provide for a monthly benefit service pension as an 
alternative form of service pension payment to a lump sum 
service pension at the option of the retiring member, the 
maximum service pension amount shall be determined using the 
applicable table contained in this subdivision. 
    Subd. 4.  [DEFINED CONTRIBUTION LUMP SUM SERVICE PENSIONS.] 
If the bylaws governing the volunteer firefighters' relief 
association or volunteer firefighters' account of a 
firefighters' relief association so provide exclusively, the 
relief association or account may pay a defined contribution 
lump sum service pension in lieu of any defined benefit service 
pension governed by subdivision 2.  An individual account for 
each firefighter who is a member of the relief association shall 
be established.  To each individual member account shall be 
credited a right to an equal share of:  (a) any amounts of fire 
state aid received by the relief association or account,; (b) 
any amounts of municipal contributions to the relief association 
or account raised from levies on real estate or from other 
available revenue sources exclusive of fire state aid,; and (c) 
any amounts equal to the share of the assets of the special fund 
to the credit of:  (1) any former member who terminated active 
service with the fire department of the municipality to which 
the relief association is associated or the independent 
nonprofit firefighting corporation to which the relief 
association is a subsidiary prior to meeting the minimum service 
requirement provided for in subdivision 1 and has not returned 
to active service with the fire department or independent 
nonprofit firefighting corporation for a period no shorter than 
five years; or to the credit of (2) any retired member who 
retired prior to obtaining a full nonforfeitable interest in the 
amounts credited to the individual member account pursuant to 
subdivision 2 and any applicable provision of the bylaws of the 
relief association.  In addition, any interest or investment 
income earned on the assets of the special fund shall be 
credited in proportion to the share of the assets of the special 
fund to the credit of each individual member account.  At the 
time of retirement pursuant to subdivision 1 and any applicable 
provision of the bylaws of the relief association, a retiring 
member shall be entitled to that portion of the assets of the 
special fund to the credit of the member in the individual 
member account which is nonforfeitable pursuant to subdivision 2 
and any applicable provision of the bylaws of the relief 
association based on the number of years of service to the 
credit of the retiring member.  
    Subd. 5.  [SERVICE CREDIT MAXIMUM.] No relief association 
or account to which this chapter applies and where for which the 
governing bylaws provide for a monthly service pension to a 
retiring member shall credit any member with service in excess 
of 30 years; provided, however, that for any.  For a member of a 
relief association or account who, as of July 1, 1979, has 
received credit for service in excess of 30 years, the 
limitation on the crediting of further service credit provided 
for in this subdivision shall apply applies to any additional 
years of service occurring after July 1, 1979.  
    Subd. 6.  [PAYMENT OF SERVICE PENSIONS; NONASSIGNABILITY.] 
The method of calculating service pensions shall be applied 
uniformly, except as otherwise provided in this section.  No 
service pension shall be paid to any person while the person 
remains an active member of the respective municipal fire 
department or nonprofit firefighting corporation, and no person 
who is receiving a service pension shall be entitled to receive 
any other benefits from the special fund of the relief 
association or account.  No service pension or retirement 
ancillary benefits paid or payable from the special fund of a 
relief association or account to any person receiving or 
entitled to receive a service pension or other ancillary 
benefits shall be subject to garnishment, judgment, execution or 
other legal process and.  No person entitled to a service 
pension or other retirement ancillary benefits from the special 
fund of a relief association or account shall have the right to 
may assign any service pension or retirement ancillary benefit 
payments, nor shall the association have the authority to 
recognize any assignment or pay over any sum which has been 
assigned.  
    Subd. 7.  [DEFERRED SERVICE PENSIONS.] A member of a relief 
association or account to which this section applies who is 
entitled to a deferred service pension if the member:  
     (1) has completed the lesser of the minimum period of 
active service with the municipal fire department or independent 
nonprofit firefighting corporation specified in the bylaws or 20 
years of active service with the municipal fire department to 
which the relief association or account is directly associated 
with or the independent nonprofit firefighting corporation of 
which the relief association is a subsidiary, who;  
    (2) has completed at least ten years of active membership 
in the relief association or account; and who 
    (3) separates from active service and membership prior to 
reaching the age of 50 years or the minimum age for retirement 
and commencement of a service pension specified in the bylaws 
governing the relief association or account if that age is 
greater than the age of 50 years shall be entitled to a deferred 
service pension to.  The deferred service pension shall commence 
upon when the former member reaching reaches the age of 50 years 
or the minimum age specified in the bylaws governing the relief 
association or account if that age is greater than the age of 50 
years and upon when the former member making makes a valid 
written application.  Any relief association or account which 
provides a lump sum service pension may, when its governing 
bylaws so provide, pay interest on the deferred lump sum service 
pension during the period of deferral.  If provided for, 
interest shall be paid at the rate actually earned by the relief 
association or account, but not to exceed the interest rate 
specified in section 356.215, subdivision 4, clause (4), and 
shall be compounded annually based on calendar year balances.  
The deferred service pension shall be governed by and shall be 
calculated pursuant to any general statute, special law, relief 
association articles of incorporation or relief association 
bylaw provisions applicable as of the date on which the member 
separated from active service with the fire department or the 
nonprofit firefighting corporation and active membership in the 
relief association or account.  
    Subd. 8.  [LUMP SUM SERVICE PENSIONS; INSTALLMENT 
PAYMENTS.] Any relief association or account, if the governing 
bylaws so provide, may pay, at the option of the retiring member 
and in lieu of a single payment of a lump sum service pension, 
pay a lump sum service pension in installments. 
    The election of installment payments shall be irrevocable 
and shall be made by the retiring member in writing and filed 
with the secretary of the relief association no later than 30 
days prior to the commencement of payment of the service 
pension.  The amount of the installment payments shall be 
determined so that the present value of the aggregate 
installment payments computed at an interest rate of five 
percent, compounded annually, is equal to the amount of the 
single lump sum payment which would have been made had the 
installment payments option not been elected.  The payment of 
each installment shall include interest at the rate of five 
percent, compounded annually on the reserve supporting the 
remaining installment payments as of the date on which the 
previous installment payment was paid and computed from the date 
on which the previous installment payment was paid to the date 
of payment for the current installment payment. 
    To the extent that the commissioner of insurance deems it 
to be necessary or practical, the commissioner may specify and 
issue procedures, forms or mathematical tables for use in 
performing the calculations required pursuant to this 
subdivision.  
    Subd. 9.  [LIMITATION ON RETIREMENT ANCILLARY BENEFITS 
OTHER THAN SERVICE PENSION.] Any relief association or account 
to which this section applies, if the governing bylaws so 
provide, may provide retirement coverage for and may pay any one 
or any combination death, disability, funeral and survivorship 
ancillary benefits which would constitute an authorized 
disbursement as specified in section 424A.05 subject to the 
following limitations: 
    (1) (a) With respect to a relief association or account 
where the in which governing bylaws provide for a lump sum 
service pension to a retiring member, no retirement ancillary 
benefit may be paid to any former member or paid to any person 
on behalf of any former member subsequent to after the former 
member terminating (1) terminates active service with the 
municipal fire department to which the relief association or 
account is directly associated or the independent nonprofit 
firefighting corporation of which the relief association is a 
subsidiary, whichever is applicable, and active membership in 
the relief association or account,; and commencing (2) commences 
receipt of a service pension as authorized pursuant to this 
section; and 
    (2) (b) With respect to any relief association or account, 
no retirement 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 is calculated using the service pension amount 
specified in the governing bylaws of the relief association and 
the years of service credited to the member or former member. 
The years of service are determined as of (1) the date the 
member or former member became entitled to the retirement 
ancillary benefit; or (2) the date the member or former member 
died entitling a survivor or the estate of the member or former 
member to a retirement an ancillary benefit on behalf of the 
member or former member,.  The survivor benefit may be 
calculated (1) without regard to whether the member or former 
member had attained the minimum amount of service and membership 
credit specified in the governing bylaws or not; and (2) without 
regard to the percentage amounts specified in subdivision 2; 
except that the bylaws of any relief association may provide for 
the payment of a survivor benefit equivalent of 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. 
    Subd. 9a.  [POST RETIREMENT INCREASES.] Notwithstanding any 
provision of general or special law to the contrary, a volunteer 
firefighters' relief association paying a monthly service 
pension may, from time to time, with municipal approval pursuant 
to subdivision 10 and section 69.772, subdivision 6, or section 
69.773, subdivision 6, whichever is applicable, provide a post 
retirement increase to retired members and other retirement 
ancillary benefit recipients of the relief association if (1) 
the relief association adopts an appropriate bylaw amendment; 
and (2) the bylaw amendment is approved by the municipality 
pursuant to subdivision 10 and section 69.773, subdivision 6.  
The post retirement increase may only be granted pursuant to an 
amendment to the bylaws of the relief association and shall be 
applicable only to retired members and other retirement 
ancillary benefit recipients receiving a service pension or 
retirement ancillary benefit as of the effective date of the 
bylaw amendment.  The authority to provide a post retirement 
increase to retired members and other retirement ancillary 
benefit recipients of a relief association contained in this 
subdivision shall supersede any prior special law authorization 
relating to the provision of post retirement increases.  
    Subd. 10.  [LOCAL APPROVAL OF BYLAW AMENDMENTS; FILING 
REQUIREMENTS.] Each relief association or account to which this 
section applies shall file a complete current copy of its 
governing bylaws with the commissioner of insurance on or before 
July 1, 1980 and shall immediately file a revised copy of its 
governing bylaws with the commissioner of insurance upon the 
adoption of any amendment to its governing bylaws by the relief 
association or upon the approval of any amendment to its 
governing bylaws granted by the governing body of the each 
municipality in which served by the fire department to which the 
relief association or account is directly associated or by the 
governing bodies of all municipalities with which the 
independent nonprofit firefighting corporation of which the 
relief association is a subsidiary has contracted whichever is 
applicable.  Failure of the relief association to file a copy of 
the bylaws or any bylaw amendments with the commissioner of 
insurance shall disqualify the municipality from the 
distribution of any future fire state aid until this filing 
requirement has been completed.  
     If the special fund of the relief association does not have 
a surplus over full funding pursuant to section 69.772, 
subdivision 3, clause (2), subclause (e), or 69.773, subdivision 
4, and if the municipality is required to provide financial 
support to the special fund of the relief association pursuant 
to section 69.772 or 69.773 in the event that the fire 
department to which the relief association or account is 
directly associated is a municipal fire department, or if the 
relief association is a subsidiary of a nonprofit firefighting 
corporation, no bylaw amendment which would affect the amount 
of, the manner of payment of, or the conditions for 
qualification for service pensions or other retirement ancillary 
benefits or disbursements other than administrative expenses 
authorized pursuant to section 69.80 payable from the special 
fund of the relief association or account shall be effective 
until it has been ratified by the governing body or bodies of 
the municipality in which the fire department to which the 
relief association or account is directly associated or by the 
governing bodies of all appropriate municipalities with which 
the independent nonprofit firefighting corporation of which the 
relief association is a subsidiary has contracted, whichever is 
applicable.  If the fire department with which the relief 
association is directly associated is a municipal fire 
department and the municipality is not required to provide 
financial support to the special fund of the relief association 
pursuant to this section, the relief association may adopt or 
amend without municipal ratification its articles of 
incorporation or bylaws which increase or otherwise affect the 
retirement coverage provided by or the service pensions or 
retirement ancillary benefits payable from the special fund of 
the relief association shall be effective without municipal 
ratification so long as this does the changes do not cause the 
amount of the resulting increase in the accrued liability of the 
special fund of the relief association to exceed 90 percent of 
the amount of the prior surplus over full funding and this does 
the changes do not result in the financial requirements of the 
special fund of the relief association exceeding the expected 
amount of the future fire state aid to be received by the relief 
association as.  
    If the relief association pays only a lump sum pension, the 
financial requirements are to be determined by the board of 
trustees following the preparation of an estimate of the 
expected increase in the accrued liability and annual accruing 
liability of the relief association attributable to the change, 
if the relief association pays only a lump sum service pension 
or.  If the relief association pays a monthly benefit service 
pension, the financial requirements are to be determined by the 
board of trustees following either an updated actuarial 
valuation including the proposed change or an estimate of the 
expected actuarial impact of the proposed change prepared by the 
actuary of the relief association if the relief association pays 
a monthly benefit service pension.  If a relief association 
adopts or amends its articles of incorporation or bylaws without 
municipal ratification pursuant to this subdivision, and, 
subsequent to the amendment or adoption, the financial 
requirements of the special fund of the relief association 
pursuant to this section are such so as to require financial 
support from the municipality, the provision which was 
implemented without municipal ratification shall no longer be 
effective without municipal ratification, and any service 
pensions or retirement ancillary benefits payable after that 
date shall be paid only in accordance with the articles of 
incorporation or bylaws as amended or adopted with municipal 
ratification.  
    Subd. 11.  [DISTRIBUTION OF ASSETS UPON DISSOLUTION IN 
CERTAIN CASES.] If the fire department which is associated with 
a relief association is dissolved or eliminated by action of the 
governing body of the municipality in which the fire department 
is located, the relief association shall distribute its assets 
and be dissolved in the following manner:  
    (1) Within six months after the dissolution of the fire 
department, the board of trustees of the relief association 
shall convert all of the assets of the relief association to 
cash or negotiable instruments.  
    (2) The board shall then determine and pay all of the legal 
obligations of the association, including the costs related to 
dissolution of the corporate existence of the association, but 
excluding pension obligations to members.  
    (3) After payment of the legal obligations of the 
association, the board shall determine the pro rata share of 
each member of the association.  The pro rata share shall be 
that portion of the remaining assets of the association based on 
the proportion which the months of active service performed in 
the associated fire department bears to the total number of 
months of active service which have been performed in the 
associated fire department by all of the persons who are then 
members of the relief association.  At the time of dissolution 
of the corporation, each member shall be paid the member's pro 
rata share.  
    Sec. 7.  Minnesota Statutes 1982, section 424A.03, 
subdivision 1, is amended to read:  
    Subdivision 1.  [LIMITATION ON NONUNIFORMITY OF PENSIONS.] 
No Every partially salaried and partially volunteer 
firefighters' relief association shall provide service pensions 
to volunteer firefighter members which differ in nature or 
amount if the difference is based on compensation paid for 
firefighting services rendered by any firefighter member nor 
base the service pensions and retirement benefits it provides 
upon any rate or amount of compensation which is paid for 
firefighting services based on the years of service of the 
members not on the compensation paid to the members for 
firefighting services.  Each relief association shall provide 
service pensions to salaried members as set forth in chapter 424 
and applicable special laws. 
    Sec. 8.  Minnesota Statutes 1982, section 424A.04, is 
amended to read: 
    424A.04 [VOLUNTEER RELIEF ASSOCIATIONS; BOARD OF TRUSTEES.] 
    Subdivision 1.  [MEMBERSHIP.] Every volunteer firefighters' 
relief association directly associated with a municipal fire 
department shall be managed by a board of trustees consisting of 
nine members.  Six trustees shall be elected from the membership 
of the relief association and three trustees shall be drawn from 
the officials of the municipality which has a municipalities 
served by the fire department to which the relief association is 
directly associated or the municipality which contracts or the 
municipalities which contract with the independent nonprofit 
firefighting corporation of which the relief association is a 
subsidiary.  The bylaws of a volunteer firefighters' relief 
association may provide that one of the six trustees required to 
be elected from the membership of the relief association may be 
a retired member of the relief association receiving a monthly 
pension who is elected by the membership of the fire department 
relief association.  The three ex officio trustees, if the 
relief association is directly associated with the fire 
department of a municipality, shall be the mayor, the clerk, 
clerk-treasurer or finance director, and the chief of the 
municipal fire department.  The three ex officio trustees, if 
the 
     Every relief association that is a subsidiary of an 
independent nonprofit firefighting relief corporation, shall be 
managed by a board of trustees consisting of ten members.  Six 
trustees shall be elected from the membership of the relief 
association, three trustees shall be drawn from the officials of 
the municipalities served by the fire department to which the 
relief association is directly associated, and one trustee shall 
be the fire chief.  The bylaws of a relief association may 
provide that one of the six trustees elected from the relief 
association may be a retired member receiving a monthly pension 
who is elected by the membership of the relief association.  The 
three ex officio trustees who are the elected officials shall be 
selected as follows:  
    (1) if only one municipality contracts with the independent 
nonprofit firefighting corporation, the ex officio trustees 
shall be three elected officials of the contracting municipality 
who are designated by the governing body of the municipality if 
only one municipality contracts with the independent nonprofit 
firefighting corporation,;  
    (2) if two municipalities contract with the independent 
nonprofit firefighting corporation, the ex officio trustees 
shall be two elected officials of the largest municipality in 
population and one elected official of the next largest 
municipality in population who are designated by the governing 
bodies of the applicable municipalities if two municipalities 
contract with the independent nonprofit firefighting 
corporation,; or 
    (3) if three or more municipalities contract with the 
independent nonprofit corporation, the ex officio trustees shall 
be one elected official of each of the three largest 
municipalities in population who are designated by the governing 
bodies of the applicable municipalities if three or more 
municipalities contract with the independent nonprofit 
firefighting corporation.  An ex officio trustee shall have all 
of the rights and duties accorded to any other trustee except 
the right to be an officer of the board of trustees.  A board 
shall have at least three officers, which shall be a president, 
a secretary and a treasurer.  These officers shall be elected 
from among the elected trustees by either the full board of 
trustees or by the membership, as specified in the bylaws, and 
in no event shall any trustee hold more than one officer 
position at any one time.  The terms of the elected trustees and 
of the officers of the board shall be specified in the bylaws of 
the relief association, but shall not exceed three years.  If 
the term of the elected trustees exceeds one year, the election 
of the various trustees elected from the membership shall 
initially and shall thereafter continue to be staggered on as 
equal a basis as is practicable. 
    Subd. 2.  [FIDUCIARY DUTY.] It shall be the duty of the 
board of trustees to faithfully administer any provisions of 
statute or special law applicable to the relief association 
without prejudice and consistent with the expressed intent of 
the legislature.  The members of the board shall act as trustees 
with a fiduciary obligation to the state of Minnesota which 
authorized the creation of the relief association, to the 
taxpayers who aid in its financing, and to the firefighters who 
are its beneficiaries.  
    Sec. 9.  Minnesota Statutes 1982, section 424A.05, is 
amended to read: 
    424A.05 [RELIEF ASSOCIATION SPECIAL FUND.] 
    Subdivision 1.  [ESTABLISHMENT OF SPECIAL FUND.] Every 
volunteer firefighters' relief association shall establish and 
maintain a special fund within the relief association. 
    Subd. 2.  [SPECIAL FUND ASSETS AND REVENUES.] The special 
fund shall be credited with all fire state aid moneys received 
pursuant to sections 69.011 to 69.051, all taxes levied by or 
other revenues received from the municipality pursuant to 
sections 69.771 to 69.776 or any applicable special law 
requiring municipal support for the relief association, any 
moneys or property donated, given, granted or devised by any 
person which is specified for use for the support of the special 
fund of the relief association and any interest earned upon the 
assets of the special fund.  The treasurer of the relief 
association shall be the custodian of the assets of the special 
fund and shall be the recipient on behalf of the special fund of 
all revenues payable to the special fund.  The treasurer shall 
maintain adequate records documenting any transaction involving 
the assets or the revenues of the special fund.  These records 
and the bylaws of the relief association shall be public and 
shall be open for inspection by any member of the relief 
association, any officer or employee of the state or the 
municipality, or any member of the public, at reasonable times 
and places.  
    Subd. 3.  [AUTHORIZED DISBURSEMENTS FROM THE SPECIAL FUND.] 
Disbursements from the special fund shall not be made for any 
purpose other than one of the following: 
    (1) For the payment of service pensions to retired members 
of the relief association if authorized and paid pursuant to law 
and the bylaws governing the relief association;  
    (2) For the payment of temporary or permanent disability 
retirement benefits to disabled members of the relief 
association if authorized and paid pursuant to law and specified 
in amount in the bylaws governing the relief association;  
    (3) For the payment of survivor retirement benefits to 
surviving spouses and surviving children of deceased members of 
the relief association if authorized by and paid pursuant to law 
and specified in amount in the bylaws governing the relief 
association;  
    (4) For the payment of any funeral benefits to the 
surviving spouse, or if no surviving spouse, the estate, of the 
deceased member of the relief association if authorized by law 
and specified in amount in the bylaws governing the relief 
association;  
    (5) For the payment of the fees, dues and assessments to 
the Minnesota state fire department association and to the state 
volunteer firefighters' benefit association in order to entitle 
relief association members to membership in and the benefits of 
these state associations; and 
    (6) For the payment of administrative expenses of the 
relief association as authorized pursuant to section 69.80. 
    Subd. 4.  [INVESTMENTS OF ASSETS OF THE SPECIAL FUND.] The 
assets of the special fund shall be invested only in securities 
authorized by section 69.775.  
    Subd. 5.  [DEFINITION OF SURVIVING SPOUSE.] For purposes of 
this section, section 424A.02, and the governing bylaws of any 
relief association to which this chapter applies, the term 
"surviving spouse" means any person who was the dependent spouse 
of a deceased active member or retired former member living with 
the member at the time of the death of the active member or 
retired former member for at least one year prior to the date on 
which the member terminated active service and membership.  
    Sec. 10.  Minnesota Statutes 1982, section 424A.08, is 
amended to read: 
    424A.08 [MUNICIPALITY WITHOUT RELIEF ASSOCIATION; 
AUTHORIZED DISBURSEMENTS.] 
    Any qualified municipality which is entitled to receive 
fire state aid but which has no volunteer firefighters' relief 
association directly associated with its municipal fire 
department and does not contract with an independent nonprofit 
firefighting corporation which has a subsidiary volunteer 
firefighters' relief association, shall deposit the fire state 
aid in a special account in the municipal treasury.  
Disbursement from the special account shall not be made for any 
purpose except:  
    (1) Payment of the fees, dues and assessments to the 
Minnesota state fire department association and to the state 
volunteer firefighters' benefit association in order to entitle 
its firefighters to membership in and the benefits of these 
state associations;  
    (2) Payment of the cost of purchasing and maintaining 
needed equipment for the fire department; and 
    (3) Payment of the cost for construction, acquisition, 
repair and maintenance of buildings or other premises to house 
the fire department. 
    Sec. 11.  [REPEALER.] 
    Minnesota Statutes 1982, section 424.26, is repealed.  
    Sec. 12.  [EFFECTIVE DATE.] 
    This act is effective the day following final enactment. 
    Approved June 1, 1983