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Minnesota Legislature

Office of the Revisor of Statutes

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

  

                         Laws of Minnesota 1984 

                        CHAPTER 574-H.F.No. 1427 
           An act relating to retirement; altering the investment 
          authority for police and firefighter's relief 
          associations; making various changes in the benefits 
          for various retirement funds and plans; making 
          conforming changes in benefit calculations; amending 
          Minnesota Statutes 1982, sections 3.082; 69.775; 
          136.82, subdivision 1; 352.113, subdivision 3; 352.95, 
          subdivision 1a; 352D.02, by adding a subdivision; 
          353.34, by adding a subdivision; 354.62, subdivision 
          2; 422A.18, subdivision 3; 424.24, subdivision 2; 
          490.124, subdivision 3; and 490.129; Minnesota 
          Statutes 1983 Supplement, sections 69.77, subdivision 
          2; 352.113, subdivision 2; 352.115, subdivision 8; and 
          356.61; Laws 1947, chapter 43, section 23, as amended; 
          Laws 1963, chapter 643, section 20; Laws 1973, 
          chapters 359, section 5, subdivision 2; and 432, 
          section 4; Laws 1977, chapter 275, section 1; Laws 
          1980, chapter 600, section 17; and Laws 1981, chapter 
          68, section 43; proposing new law coded in Minnesota 
          Statutes, chapter 423A; repealing Laws 1971, chapter 
          184; Laws 1973, chapter 283; Laws 1978, chapter 617; 
          Laws 1981, chapter 224, sections 255 and 256; Laws 
          1982, chapter 578, article II, section 1, subdivision 
          7, and section 3. 
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
    Section 1.  Minnesota Statutes 1982, section 3.082, is 
amended to read: 
    3.082 [MEMBERS' EMPLOYMENT; CONTINUATION.] 
    Any member of the legislature of the state of Minnesota who 
held a position, other than a temporary position, in the employ 
of any private employer in Minnesota at the commencement of his 
service in any legislative session, who makes application for 
reemployment not later than 30 days after the last legislative 
day in each calendar year, shall be continued in or restored to 
such position, or to a position of like seniority, status and 
pay.  Retirement benefits under an employer-sponsored pension or 
retirement plan shall not be reduced by reason of time spent in 
legislative service.  
    Sec. 2.  Minnesota Statutes 1983 Supplement, section 69.77, 
subdivision 2, is amended to read: 
    Subd. 2.  The penalty provided for in subdivision 1 shall 
not apply to a relief association enumerated in subdivision 1a 
if the following requirements are met: 
    (1) Each member of the relief association pays 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 shall be made by payroll 
deduction from the salary of the member by the municipality, and 
shall be transmitted by the municipality 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.  The member contribution 
requirement specified in this clause shall not apply to any 
members who are volunteer firefighters. 
     (2) The officers of the relief association determine the 
financial requirements of the relief association and minimum 
obligation of the municipality for the following calendar year 
in accordance with the requirements of this clause.  The 
financial requirements of the relief association and the minimum 
obligation of the municipality shall be determined on or before 
the submission date established by the municipality pursuant to 
clause (3). 
     The financial requirements of the relief association for 
the following calendar year shall be based on the most recent 
actuarial valuation or survey prepared in accordance with 
sections 356.215, subdivision 4 and 356.216, as required 
pursuant to clause (8).  In the event that 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 shall be used in calculating the financial requirements 
of the relief association. 
     If the relief association has an unfunded accrued liability 
as reported in the most recent actuarial valuation or survey, 
the total of the amounts calculated pursuant to clauses (a) and 
(b) shall constitute the financial requirements of the relief 
association for the following year.  If the relief association 
does not have an unfunded accrued liability as reported in the 
most recent actuarial valuation or survey the amount calculated 
pursuant to subclause (a) shall constitute the financial 
requirements of the relief association for the following year. 
     (a) The normal level cost requirement for the following 
year, expressed as a dollar amount, which shall 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 increase in the active membership, for the 
following year. 
      (b) To the dollar amount of normal cost thus determined 
shall be added an amount equal to the level annual dollar amount 
which is sufficient to amortize the unfunded accrued liability 
by December 31, 2010, as determined from the actuarial valuation 
or survey of the fund, using an interest assumption set at the 
rate specified in section 356.215, subdivision 4, clause (4).  
The amortization date specified in this subclause shall apply to 
all local police or salaried firefighters relief associations 
and shall supersede any amortization date specified in any 
applicable special law. 
      The minimum obligation of the municipality shall be 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 amounts from the applicable 
state aid program established pursuant to sections 69.011 to 
69.051 anticipated as receivable by the relief association after 
any allocation pursuant to section 69.031, subdivision 5, clause 
(2), subclause (c) or 423A.01, subdivision 2, clause (6), and 
from the local police and salaried firefighters' relief 
association amortization aid program established pursuant to 
section 423A.02 anticipated for the following calendar year. 
      (3) The officers of the relief association shall submit 
determination of the financial requirements of the relief 
association and of the minimum obligation of the municipality to 
the governing body on or before the date established by the 
municipality which shall not be earlier than August 1 and shall 
not be later than September 1 of each year.  The governing body 
of the municipality shall ascertain whether or not the 
determinations were prepared in accordance with law. 
      (4) The municipality shall provide for and shall pay each 
year at least the amount of the minimum obligation of the 
municipality to the relief association.  If there is any 
deficiency in the municipal payment to meet the minimum 
obligation of the municipality as of the end of any calendar 
year, the amount of the deficiency shall be added to the minimum 
obligation of the municipality for the following year calculated 
pursuant to clause (2) and shall include interest at the rate of 
six percent per annum compounded from the date that the 
municipality was required to make payment pursuant to this 
clause until the date that the municipality actually makes the 
required payment. 
      (5) The municipality shall provide in the annual municipal 
budget for at least the minimum obligation of the municipality 
calculated pursuant to clause (2).  The municipality may levy 
taxes for the payment of the minimum obligation of the 
municipality 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 
pursuant to this section shall not cause the amount or rate of 
other taxes levied in that year or to be levied in a subsequent 
year by the municipality which are subject to a limitation as to 
rate or amount to be reduced.  If the municipality does not 
include the full amount of the minimum obligation of the 
municipality in the levy that the municipality certified to the 
county auditor in any year, the officers of the relief 
association shall certify the amount of any deficiency to the 
county auditor.  Upon verifying the existence of any deficiency 
in the levy certified by the municipality, the county auditor 
shall spread a levy over the taxable property of the 
municipality in the amount of the deficiency certified to by the 
officers of the relief association. 
    (6) Any sums of money paid by the municipality to the 
relief association in excess of the minimum obligation of the 
municipality in any year shall be used to amortize any unfunded 
liabilities of the relief association. 
    (7) The funds of the association shall be invested in 
securities which are proper investments pursuant to section 
11A.24, except that up to $10,000 may be invested in the stock 
of any one corporation in any account of such small size that 
the three five percent stock limitation specified in section 
11A.24, subdivision 5 would necessitate a lesser investment.  
Notwithstanding the foregoing, up to 75 percent of the market 
value of the assets of the fund may be invested in open-end 
investment companies registered under the federal Investment 
Company Act of 1940, if the portfolio investments of the 
investment companies comply with the type of securities 
authorized for investment by section 11A.24, subdivisions 2 to 
5.  The association may also invest funds in Minnesota situs 
nonfarm real estate ownership interests or loans secured by 
mortgages or deeds of trust, provided that the amount of all 
investments in real property shall not exceed ten percent of the 
market value of the association's fund.  Securities held by the 
association before July 1, 1971, which do not meet the 
requirements of this paragraph may be retained after that date 
if they were proper investments for the association on April 28, 
1969.  The governing board of the association may select and 
appoint investment agencies to act for and in its behalf or may 
certify funds for investment by the state board under the 
provisions of section 11A.17, provided that there be no limit to 
the amount which may be invested in the income share account, in 
the bond account, or in the fixed-return account, and that up to 
20 percent of that portion of the assets of the association 
invested in the Minnesota supplemental investment fund may be 
invested in the growth share account. 
     (8) The association shall procure an actuarial valuation 
showing the condition of the special fund of the relief 
association pursuant to sections 356.215 and 356.216 as of 
December 31 of every year.  A copy of the actuarial survey shall 
be filed with the director of the legislative reference library, 
the governing body of the municipality in which the association 
is organized, the executive secretary of the legislative 
commission on pensions and retirement, and the commissioner of 
insurance, not later than June 1 of the following year. 
    Sec. 3.  Minnesota Statutes 1982, section 69.775, is 
amended to read: 
    69.775 [INVESTMENTS.] 
    The special fund assets of the relief associations governed 
by sections 69.771 to 69.776 shall be invested in securities 
which are proper investments pursuant to section 11A.24, except 
that up to five percent of the special fund assets, or a minimum 
of $10,000, may be invested in the stock of any one 
corporation.  Notwithstanding the foregoing, up to 75 percent of 
the market value of the assets of the fund may be invested in 
open-end investment companies registered under the federal 
Investment Company Act of 1940, if the portfolio investments of 
the investment companies comply with the type of securities 
authorized for investment by section 11A.24, subdivisions 2 to 
5.  Securities held by the associations before January 1, 1972, 
which do not meet the requirements of this section may be 
retained after that date if they were proper investments for the 
association on May 14, 1971.  The governing board of the 
association may select and appoint investment agencies to act 
for and in its behalf or may certify funds for investment by the 
state board under the provisions of section 11A.17, provided 
that there be no limit to the amount which may be invested in 
the income share account, in the bond account, or in the 
fixed-return account, and that up to 20 percent of that portion 
of the assets of the association invested in the Minnesota 
supplemental investment fund may be invested in the growth share 
account. 
     Sec. 4.  Minnesota Statutes 1982, section 136.82, 
subdivision 1, is amended to read:  
    Subdivision 1.  The executive director of the teachers 
retirement fund shall redeem shares in the accounts of the 
Minnesota supplemental retirement investment fund standing in an 
employee's share account record under the following 
circumstances, but always in accordance with the laws and 
regulations governing the Minnesota supplemental retirement 
investment fund: 
    (1) When requested to do so in writing on forms provided by 
the executive director of the teachers retirement fund by a 
person having shares to the credit of the employee's share 
account record, if the person is 65 60 years of age or older and 
is no longer employed by the state university board or state 
board for community colleges.  In such case the person shall 
receive the cash realized on the redemption of the shares.  The 
person may direct the redemption of not more than 20 percent of 
the person's shares in the employee's share account record in 
any one year and may not direct more than one redemption in any 
one calendar month; provided, however, that the state university 
board in the case of a person employed by the state university 
board, and the state board for community colleges in the case of 
a person employed by the state board for community colleges, 
may, upon application, in their sole discretion, permit greater 
withdrawals in any one year. 
    (2) When requested to do so in writing on forms provided by 
the executive director of the teachers retirement fund by a 
person having shares to the credit of the employee's share 
account record, if the person has left employment by the state 
university board or state board for community colleges because 
of a total and permanent disability as defined in section 
354.05, subdivision 14, and if the executive director of the 
teachers retirement fund finds that the person is totally and 
permanently disabled and will as a result be unable to return to 
similar employment, the person shall receive the cash realized 
on the redemption of the shares.  The person may direct the 
redemption of not more than 20 percent of the shares in the 
employee's share account record in any one year and may not 
direct more than one redemption in any one calendar month; 
provided, however, that the state university board in the case 
of a person employed by the state university board, and the 
state board for community colleges in the case of a person 
employed by the state board for community colleges, may, upon 
application, in their sole discretion, permit greater 
withdrawals in any one year.  If the person returns to good 
health, the person shall owe no restitution to the state or any 
fund created by its laws for a redemption directed pursuant to 
this paragraph. 
     (3) In the event of the death of a person having shares to 
the credit of the employee's share account record and leaving a 
surviving spouse, then when requested to do so in writing on 
forms provided by the executive director of the teachers 
retirement fund by the surviving spouse.  The surviving spouse 
shall receive the cash realized on the redemption of the 
shares.  The surviving spouse may direct the redemption of not 
more than 20 percent of the shares in the deceased spouse's 
employee's share account record in any one year and may not 
direct more than one redemption in any one calendar month; 
provided, however, that the state university board in the case 
of a person employed by the state university board, and the 
state board for community colleges in the case of a person 
employed by the state board for community colleges, may, upon 
application, in their sole discretion, permit greater 
withdrawals in any one year.  In that case the surviving spouse 
shall receive the cash realized from the redemption of the 
shares.  Upon the death of the surviving spouse any shares 
remaining in the employee's share account record shall be 
redeemed by the executive director of the teachers retirement 
fund and the cash realized therefrom distributed to the estate 
of the surviving spouse. 
     (4) In the event of the death of a person having shares to 
the credit of the employee's share account record and leaving no 
surviving spouse, then the executive director of the teachers 
retirement fund shall redeem all shares to the credit of the 
employee's share account record and pay the cash realized 
therefrom to the estate of the deceased person. 
     (5) When requested to do so in writing on forms provided by 
the executive director of the teachers retirement fund by a 
person having shares to the credit of the employee's share 
account record, if the person is no longer employed by the state 
university board or state board for community colleges, but does 
not qualify under the provisions of paragraphs (1) to (4).  In 
that case one-half of the cash realized on the redemption of 
shares shall be received by the person and one-half shall become 
the property of the supplemental retirement plan account of the 
teachers retirement fund.  Annually on July 1 the cancellations 
of the previous 12 months shall be prorated among the employees 
share accounts in proportion to the value which each account 
bears to the total value of all share accounts. 
    Sec. 5.  Minnesota Statutes 1983 Supplement, section 
352.113, subdivision 2, is amended to read: 
    Subd. 2.  [APPLICATION; ACCRUAL OF BENEFITS.] An employee 
making claim for a total and permanent disability benefit shall 
file a written application therefor in the office of the system 
in a form and manner prescribed by the executive director.  The 
benefit shall begin to accrue 90 days the day following the 
commencement of disability or the day following the last day 
paid whichever is later but in no event earlier than 60 days 
prior to the date the application is filed with the director.  
    Sec. 6.  Minnesota Statutes 1982, section 352.113, 
subdivision 3, is amended to read: 
    Subd. 3.  [COMPUTATION OF BENEFITS.] The total and 
permanent disability benefit shall be computed in the manner 
provided in section 352.115.  The disability benefit shall be 
the normal annuity without reduction for each month the employee 
is under age 65 at the time of becoming disabled.  A disabled 
employee may elect to receive the normal disability benefit or 
an optional annuity as provided in section 352.116, subdivision 
3.  The election of an optional annuity shall be made prior to 
the commencement of payment of the disability benefit and shall 
be effective 30 days after receipt of the election or the date 
on which the disability begins to accrue as provided in 
subdivision 2, whichever occurs later.  Upon becoming effective, 
the optional annuity shall begin to accrue on the same date as 
provided for the disability benefit.  
    Sec. 7.  Minnesota Statutes 1983 Supplement, section 
352.115, subdivision 8, is amended to read: 
    Subd. 8.  [ACCRUAL OF ANNUITY.] State employees shall make 
application for an annuity but such application shall not be 
made more than 60 days prior to the time the employee is 
eligible to retire by reason of both age and service 
requirements.  If the director determines an applicant for 
annuity has fulfilled all the requirements of the law to entitle 
him to an annuity, he shall authorize payment thereof in 
accordance with the provisions of this chapter and payment shall 
be made pursuant to this authorization.  An annuity shall begin 
to accrue no earlier than 60 days prior to the date the 
application is filed with the director except that if an 
optional annuity as provided in section 352.116, subdivision 3 
is selected the annuity shall begin to accrue 30 days after the 
application is filed with the director, but in no event prior to 
the day following the termination of state service or prior to 
the day the employee is eligible to retire by reason of both age 
and service requirements.  The retirement annuity shall cease 
with the last payment which had accrued to the retired employee 
during his lifetime unless he elected an optional annuity 
provided in section 352.116, subdivision 3, and he had become 
entitled to payment thereof.  The joint and last survivor 
annuity shall cease with the last payment received by the 
survivor in his or her lifetime.  If a retired employee had not 
selected an optional annuity, or a survivor annuity is not 
payable under the option, and a spouse survives, such spouse 
shall be entitled only to the annuity for the calendar month in 
which the retired employee died.  If an optional annuity is 
payable after the death of the retired employee, the survivor 
shall be entitled to the annuity for the calendar month in which 
the retired employee died.  
    Sec. 8.  Minnesota Statutes 1982, section 352D.02, is 
amended by adding a subdivision to read: 
     Subd. 1b.  An employee covered by the regular plan who is 
subsequently employed as a permanent, full-time unclassified 
employee of the legislature or any commission or agency of the 
legislature may elect to transfer accumulated employee and 
matching employer contributions, as provided in section 352D.03. 
    Sec. 9.  Minnesota Statutes 1982, section 352.95, 
subdivision 1a, is amended to read: 
    Subd. 1a.  [OPTIONAL ANNUITY ELECTION.] A disabled 
correctional employee may elect the normal disability benefit or 
an optional annuity as provided in section 352.116, subdivision 
3.  The election of an optional annuity shall be made prior to 
commencement of payment of the disability benefit and shall be 
effective 30 days after receipt of the election or the date on 
which the disability benefit begins to accrue as provided in 
subdivision 3, whichever occurs later.  Upon becoming effective, 
the optional annuity shall begin to accrue on the same date as 
provided for the disability benefit.  
    Sec. 10.  Minnesota Statutes 1982, section 353.34, is 
amended by adding a subdivision to read:  
    Subd. 3a.  [DEFERRED ANNUITY; CERTAIN HOSPITAL EMPLOYEES.] 
Any member employed by a public hospital, as defined in section 
355.71, subdivision 3, who has at least five years of allowable 
service credit on the date the public hospital is taken over by 
a private corporation or organization, may elect to receive a 
deferred annuity pursuant to subdivision 3 notwithstanding the 
length of service requirement contained therein.  
    Sec. 11.  Minnesota Statutes 1982, section 354.62, 
subdivision 2, is amended to read: 
    Subd. 2.  [INDIVIDUAL ELECTION.] Each member of the 
teachers retirement association may elect to participate in the 
variable annuity division by filing a written notice with the 
board of trustees on forms provided by the board. 
    (1) Employee variable annuity contributions to the variable 
annuity division shall be pursuant to the option available in 
section 354.44, subdivision 7, the employee variable annuity 
contributions shall be an amount equal to two percent of the 
salary of every coordinated member and four percent of the 
salary of every basic member one-half of the employee rates 
specified in section 354.42, subdivision 2. 
    (2) Employer variable annuity contributions shall be an 
amount equal to the employee variable annuity contributions 
provided in clause (1).  The deficiency in equal employer 
variable annuity contributions which shall exist prior to July 
1, 1975 shall be recovered from the additional employer 
contributions made prior to July 1, 1975 pursuant to section 
354.42, subdivision 5. 
    (3) There shall be provided for members participating in 
the variable annuity division a separate account for each member 
which will show his variable account accumulations as defined in 
section 354.05, subdivision 23.  The board shall establish such 
other accounts in the variable annuity division as it deems 
necessary for the operation of this provision. 
    (4) After June 30, 1974 there shall be no new participants 
in this program. 
    (5) Effective July 1, 1978, no future employee and employer 
contributions shall be credited to any accounts in the variable 
annuity division unless the member elects continued 
participation in the variable annuity division pursuant to 
section 354.621. 
    Sec. 12.  Minnesota Statutes 1983 Supplement, section 
356.61, is amended to read: 
    356.61 [LIMITATION ON PUBLIC EMPLOYEE RETIREMENT 
ANNUITIES.] 
    Notwithstanding any provision of law, bylaws, articles of 
incorporation, retirement and disability allowance plan 
agreements or retirement plan contracts to the contrary, no 
person who has pension or retirement coverage by a public 
pension plan shall be entitled to receive a monthly retirement 
annuity or disability benefit which, at the time of commencement 
of the retirement annuity or disability benefit, exceeds the 
lesser of:  
    (a) the amount of the final monthly salary of the person; 
or 
    (b) one-twelfth of the amount of the annual benefit 
permitted by the terms of section 415 of the Internal Revenue 
Code with respect to a participant in a plan qualified under 
section 401(a) of the Internal Revenue Code, as amended through 
December 31, 1982.  
    The benefit limitation of clause (b) is to be determined on 
the date the benefit is initially payable or on the date the 
employee terminated employment, if earlier.  The benefit 
limitation on any date is the benefit limitation for the 
limitation year in which the date occurs.  The limitations apply 
only to the annual benefit which is derived from employer 
contributions.  Mandatory and voluntary employee contributions, 
if any, are treated as a separate defined contribution plan 
maintained by the employer which is subject to the limitations 
placed on annual additions to defined contribution plans.  
    The maximum annual benefit of clause (b) for any limitation 
year is the lesser of (1) or (2) below:  
    (1) A dollar limitation of $90,000, adjusted as of January 
1 of each calendar year to the dollar limitation as determined 
for that year by the commissioner of Internal Revenue.  The 
amount determined for any year will apply to limitation years 
ending with or within that calendar year.  
    (2) A compensation limitation of 100 percent of the average 
of compensation paid or made available to the participant by the 
employer during those three consecutive calendar years of 
employment, or actual number of consecutive calendar years of 
employment if employed less than three consecutive years, which 
give the highest average.  Compensation means any compensation 
which is includable in the employee's gross income.  
     A benefit shall be deemed not to exceed the maximum benefit 
limitation of clause (b) if: 
     (1) the retirement benefits payable under the plan and 
under any other defined benefit plans of the employer do not 
exceed the $10,000 limit set in section 415(b)(4) of the 
Internal Revenue Code for the plan year, or for any prior plan 
year, and 
     (2) the employer has not at any time maintained a defined 
contribution plan in which the employee participated.  
    A public pension plan is any Minnesota public pension plan 
or fund which provides pension or retirement coverage for public 
employees other than volunteer firefighters, including any plan 
or fund enumerated in sections 356.20, subdivision 2, or 356.30, 
subdivision 3, any local police or firefighter's relief 
association to which section 69.77 applies, or any retirement or 
pension plan or fund, including a supplemental retirement plan 
or fund, established, maintained or supported by any 
governmental subdivision or public body whose revenues are 
derived from taxation, fees, assessments or from other public 
sources.  Final monthly salary is the hourly rate of 
compensation received by the person on account of the most 
recent public employment for the final pay period occurring 
prior to retirement multiplied by 174.  
    The figure for the monthly retirement annuity or disability 
benefit to be used for the calculation of this limitation shall 
not include any reduction or adjustment required for retirement 
prior to the normal retirement age or required for the election 
of an optional annuity.  
      If the figure for the monthly retirement annuity or 
disability benefit exceeds the limit contained in this section, 
the annuity or benefit payable shall be reduced appropriately.  
      The managing board of each public pension plan from which a 
retirement annuity or disability benefit is payable shall, at 
the time that the retirement annuity or disability benefit 
commences, contact all other public pension plans to determine 
whether or not the recipient of the retirement annuity or 
disability benefit is also receiving or is entitled to receive a 
retirement annuity or disability benefit from any other public 
pension plan.  If a person is entitled to receive or is 
receiving a retirement annuity or disability benefit from more 
than one public pension plan, all retirement annuities or 
disability benefits from all public pension plans shall be 
totalled in determining whether or not the limitation shall 
apply; provided however, that the limitation shall be based on 
the highest final monthly salary received by the individual from 
any plan.  Any reduction in the amount of the retirement annuity 
or disability benefit required pursuant to this section shall be 
made by the public pension plan which provided retirement 
coverage for the most recent period of service. 
    Sec. 13.  Minnesota Statutes 1982, section 422A.18, 
subdivision 3, is amended to read: 
    Subd. 3.  Payment of any disability allowance authorized by 
sections 422A.01 to 422A.25, shall commence five three months 
after date of application provided that the applicant has not 
been restored to duty.  Such payment shall be retroactive to 
date of application and shall continue throughout the full 
period of the disability subject to the same optional selections 
as are provided for service allowances; provided that when a 
disability beneficiary shall have attained the minimum age for 
retirement on a service allowance the disability allowance shall 
be discontinued only as provided by the terms of the option 
selected.  Any employee eligible for a disability allowance who 
is also entitled to an allowance under a workers' compensation 
act and/or resumes a gainful occupation shall be entitled to 
receive during the period of such compensation only that portion 
of the retirement allowance provided by this act which when 
added to such additional compensation does not exceed the salary 
of the employee at the time of disability. 
    Sec. 14.  [423A.20] [VESTING UPON LAYOFF.] 
    Notwithstanding any general or special law to the contrary, 
if a member of a salaried firefighters relief association with 
ten or more years of service is laid off and replaced with a 
volunteer firefighter, the member shall be entitled to receive a 
pro rata monthly benefit.  For purposes of this section, "laid 
off" means terminated from employment with the fire department 
because of a shortage of funds or curtailment of service or for 
any other reason not reflecting discredit on the member beyond 
the member's control.  
    The retirement benefit is to commence at the later of 
either the minimum age for retirement or the date at which the 
member would have accumulated the minimum number of years of 
service for retirement if the member had remained on duty.  
    The pro rata benefit shall be calculated by multiplying the 
amount of the benefit payable to a member who met the minimum 
age and years of service requirements for a normal pension by 
the ratio of the laid off member's actual years of service to 
the minimum years of service required for retirement.  The 
initial benefit payable shall be subject to the same post 
retirement adjustments as other benefits payable from the relief 
association.  
    Sec. 15.  Minnesota Statutes 1982, section 424.24, 
subdivision 2, is amended to read:  
    Subd. 2.  (a) "Surviving spouse" means a person who became 
the member's legally married spouse during or prior to the time 
the member was on the payroll of any such fire department as a 
firefighter, and remained such continuously after their marriage 
until the member's death, without having been granted a marriage 
dissolution or legal separation, and who, in case the deceased 
member was a service or deferred pensioner, was legally married 
to the member for at least three years one year prior to the 
member's retirement from the fire department; and who, in any 
case, was residing with the member at the time of the member's 
death.  No temporary absence for purposes of business, health or 
pleasure shall constitute a change of residence for purposes of 
this clause. 
    (b) "Surviving child" means any child of the member living 
while the deceased member was on the payroll of the fire 
department, or who were born within nine months after the 
deceased member was withdrawn from the payroll of the fire 
department. 
    Sec. 16.  Minnesota Statutes 1982, section 490.124, 
subdivision 3, is amended to read:  
    Subd. 3.  [EARLY RETIREMENT.] The retirement annuity 
provided by subdivision 1 of any judge electing to retire at an 
early retirement date shall be reduced by 1/15th for each full 
year or fraction thereof one-half of one percent per month from 
his retirement date to normal retirement date. 
    Sec. 17.  Minnesota Statutes 1982, section 490.129, is 
amended to read:  
    490.129 [BENEFITS OFFSET.] 
    Upon any event of maturity of benefits for any judge 
referred to in section 355.392, subdivision 1, clause (b), or 
for the judge's surviving spouse or dependent children, the 
amount payable from the judges' retirement fund shall be reduced 
by 75 percent of the amount of the judge's primary benefit 
payable upon the event of maturity of benefits under the social 
security act. 
    Upon any event of maturity of benefits for the judge's 
surviving spouse or dependent children under section 490.124, 
subdivision 9, the amount payable from the judges' retirement 
fund shall be based (a) on the judge's normal retirement annuity 
or (b) upon the event of maturity of benefits under the social 
security act, on the judge's normal retirement annuity after 
reduction by 75 percent of the amount of the judge's primary 
benefit under the social security act; provided that the 
surviving spouse or dependent children shall receive an annuity 
of not less than 25 percent of the judge's final average 
compensation.  
    Sec. 18.  [BUHL POLICE RETIREMENT BENEFITS.] 
    Notwithstanding the limitation contained in Minnesota 
Statutes, section 423.55 or any other law, the bylaws of the 
Buhl police relief association may be amended to provide for the 
payment of a service pension equal to 65 percent of the monthly 
base pay of a member at the time of retirement from the police 
department.  All other provisions of section 423.55 shall apply 
to the extent not inconsistent with this section.  
    Sec. 19.  Laws 1980, chapter 600, section 17, is amended to 
read: 
    Sec. 17.  [RETIREMENT COVERAGE FOR CERTAIN ST. LOUIS PARK 
POLICE OFFICERS.] Notwithstanding any provision of Minnesota 
Statutes, Section 353.64, Subdivision 1, or any other general or 
special law or rule to the contrary, a person who was employed 
by the city of St. Louis Park as a police officer during the 
period from September of 1967 through July of 1977 shall upon 
(1) reemployment as a St. Louis Park police officer and (2) 
repayment of employee contributions previously refunded to him 
plus interest on the refund amount at the rate of six percent 
per annum compounded annually from the date the refund was taken 
until the date the refund was repaid and (3) (2) the completion 
of additional service sufficient to total ten years or more, or 
upon completion of at least six years of additional service to 
the city in a capacity other than that of police officer, be 
entitled to transfer all allowable service credit in a service 
pension from the St. Louis Park police relief association to the 
public employees police and fire fund based upon ten years of 
service.  Upon fulfillment of the above conditions and 
application by the individual, but not later than December 31, 
1986, the St. Louis Park police relief association shall pay to 
the public employees police and fire fund an amount equal to the 
combined employer and employee contributions made by or on 
behalf of the individual plus compound interest thereon at the 
rate of six percent per annum from the date originally 
received.  In calculating the amount of employer contributions 
made on behalf of the individual, the amounts which represent 
the annual pro rata share of all amounts received by the St. 
Louis Park police relief association, excluding interest on the 
accumulated assets of the relief association and member 
contributions, determined on basis of the number of active 
members each year, shall be utilized.  If the amount thus paid 
is greater than the total of contributions which would have been 
required had the individual been a member of the public 
employees police and fire fund during the periods when the 
service was rendered, the amount of the excess shall be refunded 
to the St. Louis Park police relief association.  If the amount 
paid is less than the required amount, the individual shall pay 
this amount, unless the governing body of the city of St. Louis 
Park elects to make the payment the individual shall pay to the 
St. Louis Park police relief association an amount equal to the 
employee contributions which would have been required had 
employment continued until the employee attained ten years of 
allowable service credit, plus compound interest thereon at the 
rate of six percent per annum from the date originally due.  The 
city shall make the employer contribution.  No service credit in 
the public employees police and fire fund St. Louis Park police 
relief association shall be granted until all conditions of this 
section have been fulfilled and all required payments have been 
made.  
    Sec. 20.  Laws 1981, chapter 68, section 43, is amended to 
read:  
    Sec. 43.  [BUHL POLICE SURVIVOR BENEFITS.] 
    Notwithstanding any provision of any general or special law 
to the contrary, the Buhl police relief association may provide 
in its bylaws or articles of incorporation for the payment of 
survivor benefits to the surviving spouse of a deceased member, 
or the surviving dependent children equally if there be no 
surviving spouse, in an amount equal to 50 65 percent of the 
pension the deceased member was receiving on the date of death.  
The service pension is to be based on one-half of the total pay 
of the previous 12 month period.  Payment shall continue until 
the surviving spouse remarries or until the dependent children 
reach the age of 18 years, or 22 years if a full-time student.  
In the event of the death of a member prior to retirement, 
dependent children shall receive survivor benefits in the amount 
of $125 per month per child, payable until age 18 or age 22 if a 
full-time student.  
    Sec. 21.  [EVELETH POLICE AND FIREFIGHTERS; BENEFIT 
INCREASE.] 
    Notwithstanding any general or special law to the contrary, 
in addition to other benefits payable, retirement benefits 
payable to retired police officers and firefighters and the 
surviving spouses thereof by the Eveleth police and fire trust 
fund may be increased by $10 per month.  Increases may be made 
retroactive to January 1, 1984.  
    Sec. 22.  Laws 1947, chapter 43, section 23, as amended by 
Laws 1949, chapter 154, section 5, Laws 1951, chapter 43, 
section 4, Laws 1967, chapter 807, section 2, and Laws 1975, 
chapter 389, section 1, is amended to read: 
    Sec. 23.  [FARIBAULT, CITY OF; FIREMEN'S RELIEF; RETIREMENT 
AND PENSIONS; PAYMENTS UPON DEATH OF MEMBER.] When a service 
pensioner, disability pensioner, or deferred pensioner, or an 
active member of such relief association dies, leaving: 
    (a) A widow who became his legally married wife while or 
prior to the time he was on the payroll of the fire department 
and remained such continuously after such marriage until his 
death without having applied for any divorce or legal 
separation, and who, in case the deceased member was a service 
or deferred pensioner, was legally married to such member at 
least three years one year before his retirement from said fire 
department; and who, in any case, was residing with him at the 
time of his death.  No temporary absence for purposes of 
business, health, or pleasure shall constitute a change of 
residence for the purposes of this section. 
    (b) A child or children, who were living while the deceased 
was on the payroll of the fire department, or who were born 
within nine months after said decedent was withdrawn from the 
payroll of said fire department, such widow and said child or 
children shall be entitled to a pension as follows: 
    (1) To such widow a monthly pension equal to 30 percent of 
the current monthly salary of a firefighter per month for her 
natural life, and a pension equal to ten percent of the current 
monthly salary of a firefighter per month for each child under 
eighteen years of age, or under the age of 21 years if unmarried 
and a full-time student.  If such widow shall remarry, then her 
pension shall cease and terminate as of the date of her said 
marriage. 
    (2) To such child or children of a deceased member, after 
the death of the widow of such member, a monthly pension, or 
pensions, in such amount as the board of trustees of such 
association shall deem necessary to properly support such child 
or children until they reach the age of eighteen years or, if 
unmarried and a full-time student, the age of 21 years. 
    (3) In no event shall the survivor's pension or pensions 
exceed 50 percent of the current monthly salary of a firefighter 
per month. 
    (c) The amendments to subsection (b) adopted by the 1975 
session of the legislature shall not apply to widows and 
children who began drawing pensions before July 1, 1975, 
although such widows and children shall continue to draw the 
pensions to which they are entitled under the law as it existed 
before the adoption of said amendments. 
    Sec. 23.  Laws 1963, chapter 643, section 20, is amended to 
read: 
    Sec. 20.  When a service pensioner, disability pensioner, 
or deferred pensioner, or an active member of the firemen's 
relief association in Albert Lea dies leaving: 
    (a) A widow who became his legally married wife while or 
prior to the time he was on the payroll of the fire department 
and remained such continuously after such marriage until his 
death without having applied for any divorce or legal 
separation, and who, in case the deceased member was a service 
or deferred pensioner, was legally married to such member at 
least three years one year before his retirement from said fire 
department; and who, in any case, was residing with him at the 
time of his death.  No temporary absence for purposes of 
business, health, or pleasure shall constitute a change of 
residence for purposes of this section. 
    (b) A child or children, who were living while the deceased 
was on the payroll of the fire department, or who were born 
within nine months after said decedent was withdrawn from the 
payroll of said fire department, such widow and such child or 
children shall be entitled to a pension as follows: 
    (1) To such widow a monthly pension equal to 30 percent of 
the monthly wages or salary of the deceased member as of the 
date of death for her natural life and an additional monthly 
pension equal to ten percent of said monthly wages or salary for 
each child of such member under 18 years of age, all thereafter 
adjusted according to wage increases or decreases granted to 
active firemen.  However, the total amount of the pension 
payable per month to the widow and children shall not exceed 
fifty percent of the monthly wages or salary of such member at 
the time of death.  If the widow shall remarry, then her 
pension, excluding the amounts paid for children, shall cease 
and terminate as of the date of her remarriage.  Such amounts 
paid for a child or children may be increased after remarriage 
of the widow providing such increased amounts shall be based 
upon need of the children upon written findings signed by the 
board of trustees, and shall not in any event exceed for the 
total amount paid for the children a sum equal to 50 percent of 
the monthly wages or salary of such member at the time of death, 
all thereafter adjusted to wage increases or decreases granted 
to active firemen. 
     (2) To such child or children of a deceased member, after 
the death of the widow of such member, a monthly pension or 
pensions equal to, but not to exceed for the children of any one 
deceased member, the sum of 50 percent of the monthly wages or 
salary of such member at the time of death, all thereafter 
adjusted to wage increases or decreases granted to active 
firemen. 
    Sec. 24.  Laws 1973, chapter 359, section 5, subdivision 2, 
is amended to read: 
    Subd. 2.  A widow must have been the fireman's legally 
married wife living with him at the time of his death and must 
have been married to him for a period of at least one year while 
or prior to the time he was an active member of the fire 
department.  In the case the deceased fireman is retired, the 
widow must have been married to him at least three years one 
year before his retirement. 
    Sec. 25.  Laws 1973, chapter 432, section 4, is amended to 
read:  
    Sec. 4.  [USES OF PENSION FUND.] The policemen's pension 
fund shall be used only for the payment of:  
    (a) service, disability, or dependency pensions; and 
    (b) salaries, in an amount not in excess of $1,000 per year;
    (c) expenses of officers and employees of the association 
in connection with the protection of the fund; and 
    (d) all expenses of operating and maintaining the 
association administrative expenses authorized by Minnesota 
Statutes, section 69.80.  
    Sec. 26.  Laws 1977, chapter 275, section 1, is amended by 
adding a subdivision to read:  
    Subd. 1a.  [POSTRETIREMENT ADJUSTMENT.] A member who 
retires or who has retired from the Crookston police department 
and who receives or will receive a service pension from the 
relief association shall receive an annual automatic 
postretirement adjustment upon attaining the age of 55 years or 
on January 1 following the effective date of this subdivision, 
whichever occurs later.  The adjustment shall be determined by 
the board of trustees on or before December 1 annually and shall 
accrue each year as of the January 1 following determination. 
The adjustment shall be first payable with the service pension 
payment made for January.  Each adjustment shall be based on the 
percentage increase in the salary payable to a top grade patrol 
officer during the prior year.  The percentage increase in the 
salary shall be applied to the amount of service pension payable 
to the member for the month immediately prior to the month in 
which the determination is made.  The percentage increase shall 
not exceed 3.5 percent in any year and any increase in the 
salary of a top grade patrol officer in excess of 3.5 percent 
shall not carry over to or be used to calculate the increase for 
a retired member in any succeeding year. 
    Sec. 27.  [RAMSEY COUNTY; PUBLIC EMPLOYEES' RETIREMENT 
BENEFITS FOR SHERIFF'S PERSONNEL.] 
    An employee of the Ramsey County sheriff's department in 
the position of radio dispatcher, who is a member of the public 
employees police and fire fund and who was employed by the 
department before January 1, 1970 in a position that becomes 
covered by the police and fire fund membership after December 
31, 1969 may receive allowable service credit in the police and 
fire fund for prior service by paying into the fund before 
December 31, 1984, the difference between the employee, employer 
and employer additional contributions actually paid, and the 
employee, employer and employer additional contributions that 
would have been paid under applicable law if the employee had 
been in the police and fire fund before January 1, 1970, 
together with six percent compound interest from the time the 
deductions would have been made to time of payment.  If an 
employee makes payment in accord with this section, allowable 
service credit in the general fund with respect to this prior 
service is eliminated and the executive director shall transfer 
the employee's account with respect to this service from the 
general to the police and fire fund.  Ramsey County may assume 
the obligation for additional payments, with interest, with 
respect to each employee who elects to pay the employee 
contributions and interest authorized by this section.  
    Sec. 28.  [PURCHASE OF SERVICE CREDIT.] 
    Notwithstanding any law to the contrary, a former employee 
of the senate, who was also employed by the city of Saint Paul, 
may purchase prior service credit from the Minnesota state 
retirement system for the periods of employment by the senate 
between January 1, 1971, and December 31, 1974.  
    The provisions of Laws 1982, chapter 578, article II, 
section 2, shall govern the amounts and manner of payment for 
the purchase of service credit.  
    Sec. 29.  [DISABILITY OPTION BENEFIT.] 
    Notwithstanding the requirements of Minnesota Statutes, 
chapter 352, the surviving spouse of a deceased member of the 
Minnesota state retirement system who filed an application for a 
survivor's disability option benefit, but who died before the 
date the disability benefit became payable and who has not taken 
a refund of the retirement contributions shall be paid the joint 
and survivor's disability option benefit selected, computed 
according to Minnesota Statutes, section 352.113, subdivision 3, 
commencing within 60 days of the effective date of this act and 
retroactive to the date of death.  
    Sec. 30.  [PURCHASE OF PRIOR SERVICE CREDIT.] 
    Subdivision 1.  Notwithstanding any law to the contrary, a 
person who was employed by the St. Paul bureau of health from 
October 1948 to June 1955, including time spent on leave of 
absence for military service, and who contributed to the bureau 
of health retirement plan from April 1949 to April 1953, and who 
was reemployed by the city of St. Paul in the department of 
community services, division of public health on October 18, 
1971, may purchase service credit for the period from October 
1948 to June 1955 from the public employees retirement 
association for which that person has not previously received 
service credit.  
    Subd. 2.  The provisions of Laws 1982, chapter 578, article 
II, section 2, shall govern the amount and manner of payment for 
the purchase of service credit authorized by subdivision 1, 
except that the authority to make a lump sum payment or to make 
an agreement to make installments expires July 1, 1984.  
    Sec. 31.  [OWATONNA CITY HOSPITAL EMPLOYEES.] 
    Subdivision 1.  [REFUND OF CONTRIBUTIONS.] A member of the 
public employees retirement association who was employed by the 
Owatonna city hospital on the date the hospital was taken over 
by a private corporation or organization shall be paid a refund 
of accumulated employee and employer contributions made by or on 
behalf of the employee to the association, plus interest thereon 
at the rate of six percent per annum.  If an employee has 
previously received a refund of employee contributions, only the 
employer contributions plus the total interest shall be refunded.
    Subd. 2.  [DEFERRED ANNUITY.] If an employee described in 
subdivision 1 had at least five years of allowable service 
credit, the employee may elect to receive, in lieu of the 
refund, a deferred annuity pursuant to Minnesota Statutes, 
section 353.34, subdivision 3, notwithstanding the length of 
service requirements contained therein.  An employee eligible 
for a deferred annuity who has previously received a refund of 
employee contributions may reinstate his or her eligibility for 
a deferred annuity by repaying the amount refunded, including 
any interest received, to the association.  
    Sec. 32.  [ST. PAUL BUREAU OF HEALTH PERSONNEL.] 
    An employee of the St. Paul bureau of health who exercised 
the option to retire with benefits calculated pursuant to the 
law governing bureau of health pensions as authorized by Laws 
1973, chapter 767, section 4, may, within 60 days after the 
effective date of this section, revoke the option by giving 
notice of revocation to the executive director of the public 
employees retirement association.  Effective upon the giving of 
notice, the employee shall receive service credit in the basic 
plan of the public employees retirement association as if the 
employee had been a member of the association during the 
employee's entire period of service with the bureau of health.  
    Sec. 33.  [WEST ST. PAUL FIREFIGHTER'S BYLAW AMENDMENT.] 
    The West St. Paul firefighter's relief association may 
amend article XIX of their bylaws to reduce from three years to 
one year the period of marriage required in order to qualify a 
surviving spouse for survivor benefits.  
    Sec. 34.  [AMENDMENT OF ARTICLES.] 
    In accordance with the provisions of Minnesota Statutes, 
section 354A.12, subdivision 4, approval is hereby granted for 
an amendment to the articles of incorporation of the Minneapolis 
teachers' retirement fund association with respect to lump sum 
postretirement adjustments payable to retirees or 
beneficiaries.  The amendment may reduce from five to three 
years the minimum period during which a recipient must have been 
receiving an annuity or benefits in order to be eligible for an 
adjustment, increase from one-half of one percent to one percent 
the percentage of the asset value of the fund available for 
distribution, and to give the board of trustees discretion to 
reduce or eliminate the postretirement adjustment in any fiscal 
year or set an eligibility period longer than three years as a 
prerequisite to eligibility for an adjustment.  
    Sec. 35.  [TRANSFER OF FUNDS.] 
    An amount equal to one-fourth of one percent of the salary 
of each member electing to participate in the variable annuity 
division pursuant to Minnesota Statutes, section 354.62, 
subdivision 2, which salary was paid during the period from July 
1, 1979, through June 30, 1984, plus interest which would have 
been earned if the contributions would have been credited to the 
member's variable account, shall be transferred to the variable 
annuity division and credited to the appropriate participating 
member's account on June 30, 1984.  
    Sec. 36.  [REPEALER.] 
    Laws 1971, chapter 184; Laws 1973, chapter 283; Laws 1978, 
chapter 617; Laws 1981, chapter 224, sections 255 and 256; Laws 
1982, chapter 578, article II, section 1, subdivision 7, and 
section 3, are repealed.  
    Sec. 37.  [EFFECTIVE DATE.] 
    Section 1 is effective the day following final enactment 
and applies to benefits that accrue or would have accrued prior 
or subsequent to that date.  Section 14 is effective 
retroactively to July 1, 1981.  Section 29 is effective for 
deaths occurring after July 1, 1982.  Section 10 is effective 
retroactively to June 30, 1983.  Sections 11 and 35 are 
effective July 1, 1984.  Sections 18 to 27, and 33 are effective 
upon approval by the appropriate governing body and compliance 
with Minnesota Statutes, section 645.021.  In the case of 
section 24, the appropriate governing body is the Red Wing city 
council.  The remaining sections are effective the day following 
final enactment.  Refunds shall be paid or options exercised and 
repayments of refunds made pursuant to section 32 prior to July 
1, 1984.  The repeal of Laws 1982, chapter 578, article II, 
section 1, subdivision 1, and section 3, is effective July 1, 
1984.  The change in calculations of survivors' benefits under 
the judges retirement and survivors' annuities law is 
retroactive to January 1, 1983. 
    Approved April 26, 1984