Office of the Revisor of Statutes
Minnesota Session Laws - 1987, Regular Session
Key: (1) language to be deleted (2) new language
Laws of Minnesota 1987
CHAPTER 259-H.F.No. 1026
An act relating to retirement; clarifying the
responsibilities of the actuary retained by the
legislative commission on pensions and retirement;
clarifying and revising various actuarial
determinations and procedures; authorizing the
retention of actuarial advisors by various retirement
funds; specifying the contents and methods for
supplemental and alternative actuarial valuations;
establishing a separate fund for the correctional
employees retirement fund; amending Minnesota Statutes
1986, sections 3.85, subdivision 12; 3A.11,
subdivision 1; 11A.18, subdivisions 6, 9, and 11;
69.77, subdivisions 2b and 2h; 69.772, subdivision 3;
69.773, subdivisions 2 and 4; 136.82, subdivision 2;
352.01, subdivision 12; 352.03, subdivision 6;
352.116, subdivisions 1, 3, and by adding a
subdivision; 352.119, subdivision 2; 352.85,
subdivision 6; 352.86, subdivision 4; 352B.01, by
adding a subdivision; 352B.02, subdivision 1; 352B.08,
subdivision 2; 352B.26, subdivision 3; 353.01,
subdivision 14; 353.03, subdivision 3a; 353.271;
353.29, subdivision 6; 353.30, subdivision 3; 354.05,
subdivision 7; 354.06, subdivision 2a; 354.07,
subdivision 1; 354.35; 354.42, subdivision 5; 354.44,
subdivision 2; 354.45; 354.48, subdivision 3; 354.532,
subdivisions 1 and 2; 354.55, subdivisions 11, 12, and
13; 354.58; 354.62, subdivision 5; 354.63, subdivision
2; 354A.011, subdivision 17, and by adding a
subdivision; 354A.021, by adding a subdivision;
354A.32; 354A.33; 354A.41, subdivision 2; 356.20,
subdivisions 2, 3, and 4; 356.215; 356.216; 356.22,
subdivision 2; 356.23; 356.41; 356.451, subdivision 1;
422A.01, subdivisions 6, 7, and 10; 422A.04,
subdivisions 2 and 3; 422A.06, subdivisions 2, 5, 7,
and 8; 422A.101; 422A.15, subdivisions 2 and 3;
422A.16, subdivisions 2, 3a, and 10; 422A.17; 422A.23,
subdivisions 6 and 7; 490.121, subdivision 20; and
490.124, subdivision 11; proposing coding for new law
in Minnesota Statutes, chapter 352; repealing
Minnesota Statutes 1986, section 352B.26, subdivision
2.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:
Section 1. Minnesota Statutes 1986, section 3.85,
subdivision 12, is amended to read:
Subd. 12. [VALUATIONS AND REPORTS TO LEGISLATURE.] (a) The
commission shall contract with an established actuarial
consulting firm to conduct annual actuarial valuations and
financial adequacy studies for the funds specified retirement
plans named in clause (b). The contract shall also include
provisions for performing cost analyses of proposals for changes
in benefit and funding policies.
(b) The plans which shall be included in The contract for
actuarial valuation and analysis are shall include the following
retirement plans:
(1) the Statewide Teachers Retirement Association;
(2) the General Plan, Minnesota State Retirement System;
(3) the Correctional Plan, Minnesota State Retirement
System;
(4) the State Patrol Plan, Minnesota State Retirement
System;
(5) the Judges Plan, Minnesota State Retirement System;
(6) the Minneapolis Employees Retirement Fund;
(7) the General Plan, Public Employees Retirement
Association;
(8) the Police and Fire Plan, Public Employees Retirement
Association;
(9) the Duluth Teachers Retirement Association;
(10) the Minneapolis Teachers Retirement Association;
(11) the St. Paul Teachers Retirement Association; and
(12) the Legislator's Retirement Plan, Minnesota State
Retirement System; and
(13) the Elective State Officers Retirement Plan, Minnesota
State Retirement System.
(c) The contract shall include the following:
(1) Effective for every year beginning in fiscal year 1986,
the contract shall specify completion of standard actuarial
valuations for the preceding fiscal year with contents as
described in section 356.215, subdivisions 4 to 4k; and cash
flow forecasts through the amortization target date. For funds
using a calendar year valuation period the first valuation shall
be for the period ending December 31, 1985.
(2) Effective for every four years, plan year beginning in
fiscal year 1988 1987, the contract shall specify preparation of
an exhibit on the experience of the fund for inclusion in the
annual actuarial valuation and completion of an a periodic
experience study for the four-year period ending June 30 of the
preceding fiscal year as provided for in the standards adopted
by the commission. The experience study shall evaluate the
appropriateness of continuing to use for future valuations the
assumptions relating to: individual salary progression; rate of
return on investments; payroll growth; mortality; withdrawal;
disability; retirement; and any other experience-related factor
that could impact the future financial condition of the
retirement funds.
(d) The commission shall annually prepare a report to the
legislature summarizing the results of the valuations and cash
flow projections and shall include with its report
recommendations concerning the appropriateness of the support
rates to achieve proper funding of the retirement funds by the
required funding dates. It shall also, within two months of the
completion of the quadrennial periodic experience studies,
prepare a report to the legislature on the appropriateness of
the valuation assumptions listed in paragraph (c), clause
(2) required for evaluation in the periodic experience study.
Sec. 2. Minnesota Statutes 1986, section 3A.11,
subdivision 1, is amended to read:
Subdivision 1. [TRANSFER OF REQUIRED RESERVES.] The
reserves necessary to fund the retirement allowance granted
pursuant to section 3A.02 to a former legislator upon retirement
shall be appropriated from the general fund to the director and
shall be transferred by the director to the Minnesota
postretirement investment fund as of the date benefits begin
last business day of the month in which the retirement allowance
begins to accrue in accord with section 11A.18. The amount of
the transfer made hereunder shall be determined by an approved
or determined under a procedure specified by the actuary as
defined in section 352.01, subdivision 15 retained by the
legislative commission on pensions and retirement, in accord
with an the appropriate mortality table using an adopted by the
board of directors of the Minnesota state retirement system
based on the experience of the plan as recommended by the
commission-retained actuary and the interest rate assumption set
at the rate specified in section 356.215, subdivision 4d.
Sec. 3. Minnesota Statutes 1986, section 11A.18,
subdivision 6, is amended to read:
Subd. 6. [PARTICIPATING PUBLIC RETIREMENT FUNDS OR PLANS;
TRANSFER OF REQUIRED RESERVES.] (a) Any public retirement fund
or plan authorized by law to participate in the postretirement
investment fund shall no later than the commencement of a last
business day of the month in which the benefit payment from the
postretirement investment fund begins, certify and transfer to
the state board money equal to the actuarially determined
reserves required for those retirement annuities and benefits
which are payable by the public retirement fund or plan and
which are specified in law to be included in the participation
in the fund as determined by or determined under a procedure
specified by the actuary retained by the legislative commission
on pensions and retirement.
(b) If the exact amount of the actuarially determined
required reserves is not readily calculable as of the date of
the commencement of a benefit payment, the initial transfer must
be based on the best estimate by the executive director of the
retirement fund involved and shall be made on a timely basis.
Any necessary adjustments based on specific calculations of
actuarially determined required reserves must be made in later
transfers. If a best estimate initial transfer is insufficient,
the later transfer from the retirement fund must include
interest on the amount of the required reserve insufficiency at
the greater of the following rates:
(1) the average short-term investment return rate earned by
the state board over the 30-day period ending with the last
business day of the month before the month in which the later
adjustment transfer is made; or
(2) the preretirement interest assumption for the
retirement fund as specified in section 356.215, subdivision 4d,
stated as a monthly rate.
Interest on the amount of a required reserve insufficiency
payable by a retirement fund shall be compounded on a monthly
basis. No interest shall be payable from the postretirement
investment fund in the event of a required reserve
oversufficiency.
(c) The state board shall confirm in writing each
certification and transfer of money made by a participating
public retirement fund or plan. Each participating public
retirement fund or plan shall maintain adequate records to
account for money transferred to or from the postretirement
investment fund.
Sec. 4. Minnesota Statutes 1986, section 11A.18,
subdivision 9, is amended to read:
Subd. 9. [CALCULATION OF POSTRETIREMENT ADJUSTMENT.]
Annually, following June 30, the state board shall determine
whether a postretirement adjustment shall be payable and shall
determine the amount of any postretirement adjustment which
shall be payable.
(1) The state board shall determine whether a
postretirement adjustment shall be payable using the following
procedure:
(a) The state board shall determine the amount of
dividends, interest, accruals and realized capital gains or
losses applicable to the most recent fiscal year ending June 30;
(b) The participating public pension funds or plans shall
determine the amount of reserves required for every the annuity
or benefit payable to an annuitant and benefit recipient of the
participating public pension plans or funds shall be determined
by the commission-retained actuary as of the current June 30.
Every An annuitant or benefit recipient who has been receiving
an annuity or benefit for at least one year as of the current
June 30 shall be eligible to receive a postretirement
adjustment. Each fund shall report separately the amount of the
reserves for those annuitants and benefit recipients who are
eligible to receive a postretirement benefit adjustment and
those annuitants and benefit recipients who are not eligible to
receive a postretirement adjustment shall be reported
separately. The amount of the required reserves shall be
certified to the board by the commission-retained actuary as
soon as is practical following the current June 30;
(c) The state board shall determine the amount of
investment income required to equal five percent of the total
amount of the required reserves as of the preceding June 30
adjusted by five percent of each transfer in or transfer out
multiplied by the fraction of a year from the date of transfer
to the current June 30. This amount of required investment
income shall be subtracted from the actual amount of investment
income determined according to clause (1)(a), to determine the
amount of excess investment income. If this amount is positive,
then a postretirement adjustment may be paid.
(2) The state board shall determine the amount of any
postretirement adjustment which is payable using the following
procedure:
(a) The state board shall determine the amount of excess
investment income by the method indicated in clause (1);
(b) The participating public pension funds and plans shall
certify to the state board the total required reserves as of the
first of January next following the end of the fiscal year for
the annuitants and benefit recipients eligible to receive the
postretirement adjustment as determined by clause (1)(b) shall
be certified to the state board by the commission-retained
actuary. The required reserves shall be determined by the
commission-retained actuary on the assumption that all
annuitants and benefit recipients eligible to receive the
postretirement adjustment will be alive on the January 1 in
question;
(c) If the state board determines that the book value of
the assets of the fund is less than an amount equal to 100
percent of the total amount of the current June 30 required
reserves, with the book value and required reserves to be
determined after the adjustments provided for in subdivision 11,
then the state board shall allocate five percent of the excess
investment income as an asset of the fund. The excess
investment income allocated as an asset of the fund shall not
exceed the difference between book value and required reserves.
The remaining amount shall be termed available for
distribution. The book value of assets on any given date shall
be the net assets at cost less the excess investment income
determined pursuant to clause (1)(c);
(d) The resulting total amount available for distribution
shall be increased by 2-1/2 percent, and the result shall be
stated as a percentage of the total amount of the required
reserves pursuant to clause (2)(b), and if the percentage is
equal to or greater than one percent, the amount shall be
certified to each participating public pension fund or plan as
the amount of the postretirement adjustment. If the percentage
is less than one percent, no postretirement adjustment shall be
payable in that year and the amount otherwise available for
distribution shall be credited to a separate reserve established
for this purpose. The reserve shall be invested in the same
manner as all other assets of the fund and shall be credited
with any investment income as specified in clause (1)(a).
Amounts credited to the reserve shall be utilized in determining
a postretirement adjustment in the subsequent year. The
amount of any postretirement adjustment certified by the state
board as payable to the participating public pension plans or
funds shall be carried to five decimal places and stated as a
percentage.
(e) A retirement annuity payable in the event of retirement
before becoming eligible for social security benefits as
provided in sections 352.116, subdivision 3; 353.29, subdivision
6; or 354.35 must be treated as the sum of a period certain
retirement annuity and a life retirement annuity for the
purposes of any postretirement adjustment. The period certain
retirement annuity plus the life retirement annuity shall be the
annuity amount payable until age 62 or 65, whichever applies. A
postretirement adjustment granted on the period certain
retirement annuity must terminate when the period certain
retirement annuity terminates.
Sec. 5. Minnesota Statutes 1986, section 11A.18,
subdivision 11, is amended to read:
Subd. 11. [ADJUSTMENT FOR MORTALITY GAINS AND LOSSES.] As
of June 30 annually, the commission-retained actuary of each
participating public pension fund or plan shall calculate the
amount of required reserves representing any mortality gains and
any mortality losses incurred by the each participating public
pension fund or plan during the fiscal year and report the
results of those calculations to the applicable participating
public pension fund or plan. The actuary shall report
separately the amount of the reserves for annuitants and benefit
recipients who are eligible for a postretirement benefit
adjustment and the amount of reserves for annuitants and benefit
recipients who are not eligible for a postretirement benefit
adjustment. If the net amount of required reserves represents a
mortality gain, the participating public pension fund or plan
shall certify that amount to the state board, which shall sell
sufficient securities or transfer sufficient available cash to
equal the amount of money certified. If the amount of required
reserves represents a mortality loss, the participating public
pension fund or plan shall transfer to the state board an amount
equal to the amount of the net mortality loss. The amount of
the transfers shall be determined before any postretirement
benefit adjustments have been made. All transfers resulting
from mortality adjustments shall be completed annually by
December 31 for the preceding June 30. Interest shall be
charged or credited on any transfers after December 31 based
upon the average short-term rate earned by the postretirement
investment fund. All Book values of the assets of the fund for
the purposes of subdivision 9 shall be determined only after all
adjustments for mortality gains and losses for the fiscal year
have been made.
Sec. 6. Minnesota Statutes 1986, section 69.77,
subdivision 2b, is amended to read:
Subd. 2b. [RELIEF ASSOCIATION FINANCIAL REQUIREMENTS;
MINIMUM MUNICIPAL OBLIGATION.] The officers of the relief
association shall 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 subdivision. 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 subdivision 2c.
The financial requirements of the relief association for
the following calendar year shall be based on the most recent
actuarial valuation or survey of the special fund of the
association if more than one fund is maintained by the
association, or of the association, if only one fund is
maintained, prepared in accordance with sections 356.215,
subdivisions 4 to 4k and 356.216, as required pursuant to
subdivision 2h. In the event that If an actuarial estimate is
prepared by the actuary of the relief association as part of
obtaining a modification of the benefit plan of the relief
association and the modification is implemented, the actuarial
estimate shall be used in calculating the financial requirements
of the relief association.
If the relief association has an unfunded actuarial accrued
liability as reported in the most recent actuarial valuation or
survey, the total of the amounts calculated pursuant to clauses
(a) and, (b), and (c) shall constitute the financial
requirements of the relief association for the following year.
If the relief association does not have an unfunded actuarial
accrued liability as reported in the most recent actuarial
valuation or survey the amount calculated pursuant to clause
clauses (a) and (b) 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 dollar amount of the
administrative expenses of the special fund of the association
if more than one fund is maintained by the association, or of
the association if only one fund is maintained, for the most
recent year, multiplied by the factor of 1.035.
(c) To the dollar amount of normal cost thus and expenses
determined under clauses (a) and (b) shall be added an amount
equal to the level annual dollar amount which is sufficient to
amortize the unfunded actuarial 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 4d. The amortization
date specified in this clause 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 anticipated for the
following calendar year 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 made
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 and from the
supplementary amortization state-aid program established under
Laws 1984, chapter 564, section 48, and Laws 1985, chapter 261,
section 17.
Sec. 7. Minnesota Statutes 1986, section 69.77,
subdivision 2h, is amended to read:
Subd. 2h. [ACTUARIAL VALUATION REQUIRED.] The association
shall procure obtain an actuarial valuation showing the
condition of the special fund of the relief association pursuant
to sections 356.215 and 356.216 and any applicable standards for
actuarial work established by the legislative commission on
pensions and retirement as of December 31 of every year. A copy
of the actuarial survey valuation 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 director of the legislative commission on pensions
and retirement, and the state auditor, not later than July 1 of
the following year.
Sec. 8. Minnesota Statutes 1986, 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 for
the current calendar year, the financial requirements of the
special fund for the following calendar year and the minimum
obligation of the municipality with respect to the special fund
for the following calendar year in accordance with the
requirements of this subdivision.
(1) The overall funding balance of the special fund for the
current calendar year shall be determined in the following
manner:
(a) The total accrued liability of the special fund 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 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. To the extent possible,
for those assets for which a market value is readily
ascertainable, the current market value as of the date of the
calculation for those assets shall be utilized in making this
calculation. For any asset for which no market value is readily
ascertainable, the cost value or the book value, whichever is
applicable, shall be utilized in making this calculation.
(c) The amount of the total present assets of the special
fund calculated pursuant to clause (b) shall be subtracted from
the amount of the total accrued liability of the special fund
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 for the
following calendar year shall be determined in the following
manner:
(a) The total accrued liability of the special fund 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 in the total accrued liability of the
special fund for the following calendar year over the total
accrued liability of the special fund for the current year shall
be calculated.
(c) The amount of anticipated future administrative
expenses of the special fund shall be calculated by multiplying
the dollar amount of the administrative expenses of the special
fund for the most recent year by the factor of 1.035.
(d) If the special fund is fully funded, the financial
requirement of the special fund for the following calendar year
shall be the figure which represents the increase in the total
accrued liability of the special fund as calculated pursuant to
subclause (b).
(d) (e) If the special fund 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) (d) 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 from full funding 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 after December 31, 1971 until each
increase in the deficit from full funding is fully retired.
(e) (f) If the special fund 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) (d) 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 shall be the financial requirements of the
special fund 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 during
the following calendar year, an amount of interest on the assets
of the special fund projected to the 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. 9. Minnesota Statutes 1986, section 69.773,
subdivision 2, is amended to read:
Subd. 2. [DETERMINATION OF ACTUARIAL CONDITION AND FUNDING
COSTS.] Each A relief association to which this section applies
shall procure obtain an actuarial valuation showing the
condition of the special fund of the relief association as of
December 31, 1978 and at least as of December 31 every four
years thereafter. The valuation shall be prepared in accordance
with the provisions of section sections 356.215, subdivision 4d,
and 356.216 and any applicable standards for actuarial work
established by the legislative commission on pensions and
retirement, except that the figure for normal cost shall be
expressed as a level dollar amount, and the amortization
contribution shall be the level dollar amount calculated to
amortize any current unfunded accrued liability by at least the
date of full funding specified in subdivision 4, clause (b).
Each valuation shall be filed with the governing body of the
municipality in which the relief association is located and with
the state auditor, not later than July 1 of the year next
following the date as of which the actuarial valuation is
prepared. Any relief association which is operating under a
special law which requires that actuarial valuations be procured
obtained at least every four years and be prepared in accordance
with applicable actuarial standards set forth in statute may
continue to have actuarial valuations made according to the time
schedule set forth in the special legislation subject to the
provisions of subdivision 3.
Sec. 10. Minnesota Statutes 1986, section 69.773,
subdivision 4, is amended to read:
Subd. 4. [FINANCIAL REQUIREMENTS OF THE SPECIAL FUND.]
Prior to August 1 of each year, the officers of the relief
association shall determine the financial requirements of the
special fund of the relief association in accordance with the
requirements of this subdivision. The financial requirements of
the relief association shall be based on the most recent
actuarial valuation of the special fund prepared in accordance
with sections 356.215, subdivisions 4 to 4k, and
356.216 subdivision 2. If the relief association has an
unfunded actuarial accrued liability as reported in the most
recent actuarial valuation, the financial requirements shall be
determined by adding the figures calculated pursuant to clauses
(a) and, (b), and (c). If the relief association does not have
an unfunded actuarial accrued liability as reported in the most
recent actuarial valuation, the financial requirements shall be
an amount equal to the figure calculated pursuant to clause
clauses (a): and (b). The determination of whether or not the
relief association has an unfunded actuarial accrued liability
shall be based on the current market value of assets for which a
market value is readily ascertainable and the cost or book
value, whichever is applicable, for assets for which no market
value is readily ascertainable.
(a) The normal level cost requirement for the following
year, expressed as a dollar amount, shall be the figure for the
normal level cost of the relief association as reported in the
actuarial valuation.
(b) The amount of anticipated future administrative
expenses of the special fund shall be calculated by multiplying
the dollar amount of the administrative expenses of the special
fund for the most recent year by the factor of 1.035.
(c) The amortization contribution requirement to retire the
current unfunded actuarial accrued liability by the established
date for full funding shall be the figure for the amortization
contribution as reported in the actuarial valuation. If there
has not been a change in any or all of the actuarial assumptions
used for calculating the actuarial accrued liability of the
special fund, a change in the bylaws of the relief association
governing the service pensions, retirement benefits or both
payable from the special fund or a change in the actuarial cost
method used to value all or a portion of the special fund which
change or changes, which by themselves without inclusion of any
other items of increase or decrease, produce a net increase in
the unfunded actuarial accrued liability of the special fund
since December 31, 1970, the established date for full funding
shall be December 31, 1990. If there has been a change in the
actuarial assumptions used for calculating the actuarial accrued
liability of the special fund, a change in the bylaws of the
relief association governing the service pensions, retirement
benefits or both payable from the special fund or a change in
the actuarial cost method used to value all or a portion of the
special fund which and the change or changes, which by
themselves and without inclusion of any other items of increase
or decrease, produce a net increase in the unfunded actuarial
accrued liability of the special fund since December 31, 1970
but prior to January 1, 1979, the established date for full
funding shall be December 31, 1998, and if there has been a
change since December 31, 1978, the established date for full
funding shall be determined using the following procedure:
(i) The unfunded actuarial accrued liability of the special
fund shall be determined in accordance with the provisions
governing service pensions, retirement benefits and actuarial
assumptions in effect prior to before an applicable change;
(ii) The level annual dollar contribution needed to
amortize this unfunded actuarial accrued liability amount by the
date for full funding in effect prior to the change shall be
calculated using the interest assumption specified in section
356.215, subdivision 4d, in effect prior to before any
applicable change;
(iii) The unfunded actuarial accrued liability of the
special fund shall be determined in accordance with any new
provisions governing service pensions, retirement benefits and
actuarial assumptions and the remaining provisions governing
service pensions, retirement benefits and actuarial assumptions
in effect prior to before an applicable change;
(iv) The level annual dollar contribution needed to
amortize the difference between the unfunded actuarial accrued
liability amount calculated pursuant to subclause (i) and the
unfunded actuarial accrued liability amount calculated pursuant
to subclause (iii) over a period of 20 years from starting
December 31 of the year in which the change is effective shall
be calculated using the interest assumption specified in section
356.215, subdivision 4d, in effect subsequent to after any
applicable change;
(v) The annual amortization contribution calculated
pursuant to subclause (iv) shall be added to the annual
amortization contribution calculated pursuant to subclause (ii);
(vi) The period in which the unfunded actuarial accrued
liability amount determined in subclause (iii) will be amortized
by the total annual amortization contribution computed pursuant
to subclause (v) shall be calculated using the interest
assumption specified in section 356.215, subdivision 4(d) 4d, in
effect subsequent to after any applicable change, rounded to the
nearest integral number of years, but which shall not exceed a
period of 20 years from the end of the year in which the
determination of the date for full funding using this procedure
is made and which shall not be less than the period of years
beginning in the year in which the determination of the date for
full funding using this procedure is made and ending by the date
for full funding in effect prior to before the change.
(vii) The period determined pursuant to subclause (vi)
shall be added to the date as of which the actuarial valuation
was prepared and the resulting date obtained shall be the new
date for full funding.
Sec. 11. Minnesota Statutes 1986, section 136.82,
subdivision 2, is amended to read:
Subd. 2. [REDEMPTION OF SHARES AS AN ANNUITY.] A person
who has shares to the credit of the employee's share account
record, who is 55 years of age or older and who is authorized to
request redemption of shares pursuant to subdivision 1,
paragraph (1) notwithstanding the age 65 requirement no longer
employed by the state university board or the state board for
community colleges or who is authorized to request redemption of
shares totally and permanently disabled pursuant to subdivision
1, paragraph (2), or who has the status of a surviving spouse of
the a person who is authorized to request redemption of has
shares to the credit of the employee's share account pursuant to
subdivision 1, paragraph (3), may redeem all or part of the
shares, and for the purpose of purchasing to purchase an annuity
as herein provided may deposit by depositing the cash realized
upon redemption with the executive director of the teachers
retirement fund and receive in exchange therefor an annuity for
life or an optional annuity as hereinafter provided. The
election to purchase an annuity may be made only once by any
individual. In the event the If an election is made prior to
before the date on which the person is entitled to request
redemption, the redemption shall not be made prior to the date
upon which the person would be entitled thereto to make the
request. The annuity purchase rates shall be based on an
appropriate the annuity table of mortality with interest adopted
by the board of trustees of the teachers retirement fund for the
fund as provided in section 354.07, subdivision 1 using the
interest assumption specified in section 356.215, subdivision
4d. The amount of the annuity for life shall be an that amount
which has a present value equal to the annuity which could be
purchased with the cash realized on the redemption of the shares
as of the first day of the month next following the date of the
election to purchase an annuity. The board of trustees of the
teachers retirement fund shall establish an optional joint and
survivor annuity, an optional annuity payable for a period
certain and for life thereafter, and an optional guaranteed
refund annuity paying the annuitant a fixed amount for life with
the guarantee that in the event of death the balance of the cash
realized from the redemption of shares is payable to the
designated beneficiary. The optional forms of annuity shall be
actuarially equivalent to the single life annuity as defined in
section 354.05, subdivision 7. In establishing these optional
forms, the board of trustees shall obtain the written
recommendation of an approved the actuary as defined in section
354.05, subdivision 10 retained by the legislative commission on
pensions and retirement, and these recommendations shall be a
part of the permanent records of the board of trustees.
Sec. 12. Minnesota Statutes 1986, section 352.01,
subdivision 12, is amended to read:
Subd. 12. [ACTUARIAL EQUIVALENT.] "Actuarial equivalent"
means the annual amount determined by calculations based on
mortality tables, purchasable with a given amount at a stated
age condition of one annuity or benefit having an equal
actuarial present value as another annuity or benefit,
determined as of a given date at a specified age with each
actuarial present value based on the appropriate mortality table
adopted by the board of directors based on the experience of the
fund as recommended by the actuary retained by the legislative
commission on pensions and retirement and using the applicable
preretirement or postretirement interest rate assumption
specified in section 356.215, subdivision 4d.
Sec. 13. Minnesota Statutes 1986, section 352.03,
subdivision 6, is amended to read:
Subd. 6. [DUTIES AND POWERS OF EXECUTIVE DIRECTOR.] The
management of the system is vested in the director who shall be
the executive and administrative head of the system. The
director shall act as advisor to the board on all matters
pertaining to the system, and shall also act as the secretary of
the board. The director shall:
(1) Attend all meetings of the board;
(2) Prepare and recommend to the board appropriate rules
for the purpose of carrying to carry out the provisions of this
chapter;
(3) Establish and maintain an adequate system of records
and accounts following recognized accounting principles and
controls;
(4) Designate an assistant director with the approval of
the board;
(5) Appoint such employees, both permanent and temporary,
as are necessary to carry out the provisions of said chapter;
(6) Organize the work of the system as the director deems
necessary to fulfill the functions of the system, and define the
duties of its employees and delegate to them any powers or
duties, subject to the control of the director and under such
conditions as the director may prescribe. Appointments to
exercise delegated power shall be by written order and shall be
filed with the secretary of state;
(7) With the advice and consent of the board, contract for
actuarial the services of an approved actuary, professional
management services, and any other consulting services as may be
necessary and fix the compensation therefor for those services.
The contracts shall not be subject to the competitive bidding
procedure prescribed by chapter 16 16B. Any approved actuary
retained by the executive director shall function as the
actuarial advisor of the board and the executive director, and
may perform actuarial valuations and experience studies to
supplement those performed by the actuary retained by the
legislative commission on pensions and retirement. Any
supplemental actuarial valuations or experience studies shall be
filed with the executive director of the legislative commission
on pensions and retirement. Professional management services
may not be contracted for more often than once in every six
years. Copies of all professional management survey reports
shall be sent directly transmitted to the legislature secretary
of the senate, the chief clerk of the house of representatives,
and the legislative reference library as provided by section
3.195, to the executive director of the commission and to the
legislative auditor at the same time as reports are furnished to
the board. Only management firms experienced in conducting
management surveys of federal, state or local public retirement
systems shall be qualified to contract with the director
hereunder;
(8) With the advice and consent of the board provide
inservice training for all the employees of the system;
(9) Make refundments refunds of accumulated contributions
to former state employees and to the designated beneficiary,
surviving spouse, legal representative or next of kin of
deceased state employees or deceased former state employees, all
as provided in this chapter;
(10) Determine the amount of the annuities and disability
benefits of employees covered by the system and authorize
payment thereof of the annuities and benefits beginning as of
the dates on which the annuities and benefits begin to accrue,
all in accordance with the provisions of said this chapter;
(11) Pay annuities, refundments refunds, survivor benefits,
salaries and all necessary operating expenses of the system;
(12) Certify funds available for investment to the state
board of investment;
(13) With the advice and approval of the board request the
state board of investment to sell securities when the director
determines that funds are needed for the purposes of the system;
(14) Prepare and submit to the board and the legislature an
annual financial report covering the operation of the system, as
required by sections 356.215 to 356.23 section 356.20;
(15) Prepare and submit biennial and quarterly budgets to
the board and with the approval of the board submit the budgets
to the department of administration finance; and
(16) With the approval of the board, perform such other
duties as may be required for the administration of the
retirement and other provisions of this chapter and for the
transaction of its business.
Sec. 14. Minnesota Statutes 1986, section 352.116,
subdivision 1, is amended to read:
Subdivision 1. [REDUCED ANNUITY BEFORE AGE 65.] Any
employee who retires prior to age 65 with credit for less than
30 years of allowable service shall be paid the normal
retirement annuity provided in section 352.115, subdivisions 2
and 3, reduced so that the reduced annuity shall be the
actuarial equivalent of the annuity which would be payable to
the employee if the employee deferred receipt of the annuity
from the day the annuity begins to accrue to age 65, provided
however that if an. Any employee is entitled to who retires
prior to age 62 with credit for not less than at least 30 years
of allowable service, shall be paid the normal retirement
annuity shall be provided in section 352.115, subdivisions 2 and
3, reduced so that the reduced annuity shall be the actuarial
equivalent of the annuity which would be payable to the employee
if the employee deferred receipt of the annuity from the day the
annuity begins to accrue to age 62.
Sec. 15. Minnesota Statutes 1986, section 352.116,
subdivision 3, is amended to read:
Subd. 3. [OPTIONAL ANNUITIES.] The board shall establish
an optional retirement annuity which shall take the form of a
joint and survivor annuity. The board may also in its discretion
establish an optional annuity which shall take the form of an
annuity payable for a period certain and for life thereafter or
establish an optional annuity which takes the form of a joint
and survivor annuity providing that, if after the joint and
survivor annuity becomes payable, the person with the designated
remainder interest in the annuity dies before the former member,
the annuity amount must be reinstated to a normal single life
annuity amount as of the first day of the month after the day
the person dies. In addition, the board may also establish an
optional annuity that takes the form of an annuity calculated on
the basis of the age of the retired employee at retirement and
payable for the period before the retired employee becomes
eligible for social security old age retirement benefits in a
greater amount than the amount of the annuity calculated under
subdivision 2 on the basis of the age of the retired employee at
retirement but equal so far as possible to the social security
old age retirement benefit and the adjusted retirement annuity
amount payable immediately after the retired employee becomes
eligible for social security old age retirement benefits and
payable for the period after the retired employee becomes
eligible for social security old age retirement benefits in an
amount less than the amount of the annuity calculated under
subdivisions 2 and 3. The social security leveling option may
be calculated based on broad average social security old age
retirement benefits. The optional forms shall be actuarially
equivalent to the normal single life annuity forms provided in
sections 352.115 and 352.116, whichever applies. In
establishing these optional forms the board shall obtain the
written recommendation of an approved actuary as defined in
section 352.01, subdivision 15, and these recommendations shall
be a part of the permanent records of the board.
Sec. 16. Minnesota Statutes 1986, section 352.116, is
amended by adding a subdivision to read:
Subd. 4. [DETERMINING ACTUARIAL EQUIVALENCY.] In
establishing the procedure for determining the actuarial
equivalency of early retirement annuities as required under
subdivision 1 or in establishing actuarial equivalent optional
retirement annuity forms as required under subdivision 3, the
board shall obtain the written recommendation of the
commission-retained actuary. The recommendations shall be a
part of the permanent records of the board.
Sec. 17. Minnesota Statutes 1986, section 352.119,
subdivision 2, is amended to read:
Subd. 2. [VALUATION OF ASSETS; ADJUSTMENT OF BENEFITS.]
(1) Effective July 1, 1969, for those employees commencing to
receive benefits pursuant to this chapter, and acts amendatory
thereof, The required reserves for retirement annuities or
disability benefits under this chapter as determined in
accordance with the interest assumption then in effect and
appropriate mortality table adopted by the board of directors
based on experience of the fund as recommended by the system's
commission-retained actuary and using the interest assumption
specified in section 356.215, subdivision 4d shall be
transferred to the Minnesota postretirement investment fund as
of the date benefits begin to accrue last business day of the
month in which the retirement annuity or disability benefit
begins.
(2) Annuity and benefit payments shall be adjusted in
accordance with the provisions of section 11A.18.
Sec. 18. Minnesota Statutes 1986, section 352.85,
subdivision 6, is amended to read:
Subd. 6. [ACTUARIAL VALUATION EXHIBIT.] In Each valuation
of the Minnesota state retirement system prepared by the
commission-retained actuary pursuant to section 356.215, shall
include an exhibit pertaining to this special retirement program
shall be included which shall contain for set forth the normal
cost of the special program those actuarial valuation contents
items specified in section 356.215, subdivisions 4 to 4k, which
the executive director deems are necessary to adequately
disclose the actuarial condition of the special program.
Sec. 19. Minnesota Statutes 1986, section 352.86,
subdivision 4, is amended to read:
Subd. 4. [ACTUARIAL VALUATION EXHIBIT.] In Each valuation
of the Minnesota state retirement system prepared by the
commission-retained actuary pursuant to section 356.215, shall
include an exhibit pertaining to this special retirement program
shall be included which shall contain for set forth the normal
cost of the special program those actuarial valuation content
items specified in section 356.215, subdivisions 4 to 4k, which
the executive director deems are necessary to adequately
disclose the actuarial condition of the special program.
Sec. 20. [352.911] [CORRECTIONAL EMPLOYEES RETIREMENT
FUND.]
Subdivision 1. [FUND CREATED.] There is created a special
fund to be known as the correctional employees retirement fund.
Subd. 2. [REVENUE SOURCES.] Employee contributions under
section 352.92, subdivision 1, and employer contributions under
section 352.92, subdivision 2, and other amounts, including any
investment income on invested fund assets as authorized by law,
shall be deposited in the fund.
Subd. 3. [INVESTMENT.] The correctional employees
retirement fund shall participate in the Minnesota
postretirement investment fund and in that fund there shall be
deposited the amounts provided in section 352.119. The balance
of any assets of the fund shall be deposited in the Minnesota
combined investment funds as provided in section 11A.14, if
applicable, or otherwise under section 11A.23.
Subd. 4. [COLLECTION OF CONTRIBUTIONS.] The collection of
employee and employer contributions shall be governed by the
applicable procedures set forth in section 352.04, subdivisions
4, 5, 6, 8, and 9.
Subd. 5. [FUND DISBURSEMENT RESTRICTED.] The correctional
employees retirement fund and its share of participation in the
Minnesota postretirement investment fund shall be disbursed only
for the purposes provided for in the applicable provisions in
this chapter. The proportional share of the expenses of the
system and any benefits provided in sections 352.90 to 352.951,
other than benefits payable from the Minnesota postretirement
investment fund, shall be paid from the correctional employees
retirement fund. The retirement allowances, retirement
annuities, the disability benefits, the survivorship benefits,
and any refunds of accumulated deductions shall be paid only
from the correctional employees retirement fund after those
needs have been certified by the executive director and the
amounts withdrawn from the share of participation in the
Minnesota postretirement fund under section 11A.18. The amounts
necessary to make the payments from the correctional employees
retirement fund and the participation in the Minnesota
postretirement investment fund are annually appropriated from
those funds for those purposes.
Sec. 21. Minnesota Statutes 1986, section 352B.01, is
amended by adding a subdivision to read:
Subd. 11. [AVERAGE SALARY.] "Average monthly salary" means
the average of the highest monthly salaries for five years of
service as a member. It does not include any amounts of
severance pay or any reduced salary paid during the period the
person is entitled to workers' compensation benefit payments for
temporary disability.
Sec. 22. Minnesota Statutes 1986, section 352B.02,
subdivision 1, is amended to read:
Subdivision 1. [FUND CREATED; MEMBERSHIP.] There is hereby
established a state patrol retirement fund, the membership of
which shall consist of all persons defined in section 352B.01,
subdivision 2.
Subd. 1a. [MEMBER CONTRIBUTIONS.] Each member shall pay a
sum equal to 8.5 percent of the member's salary, which shall
constitute the member contribution to the fund.
Subd. 1b. [SALARY DEDUCTIONS.] Member contribution amounts
shall be deducted each pay period by the department head, who
shall cause the total amount of the deductions to be paid to the
state treasurer for deposit in the state patrol retirement fund,
and shall cause a detailed report of all deductions to be made
each pay period to the executive director of the Minnesota state
retirement system.
Subd. 1c. [EMPLOYER CONTRIBUTIONS.] In addition thereto,
there shall be paid out of money appropriated to the departments
for this purpose, by the department heads, a sum equal to 18.9
percent of the salary upon which deductions were made, which
shall constitute the employer contribution to the fund.
Subd. 1d. [FUND REVENUE AND EXPENSES.] These The amounts
provided for in this section shall be credited to the state
patrol retirement fund. All money received shall be deposited
by the state treasurer in the state patrol retirement fund. Out
of the fund shall be paid the administrative expenses of the
retirement fund, and the benefits and annuities as hereinafter
provided in this chapter. Appropriate amounts shall be
transferred to or withdrawn from the Minnesota postretirement
investment fund as provided in section 352B.26.
Subd. 1e. [AUDIT; ACTUARIAL VALUATION.] The legislative
auditor shall audit the fund and the executive director shall
procure an actuarial study of the fund in accordance with
chapter 356, the cost of which shall be borne by the fund. Any
actuarial valuation of the fund required under section 356.215
shall be prepared by the actuary retained by the legislative
commission on pensions and retirement. Any approved actuary
retained by the executive director under section 352.03,
subdivision 6, may perform actuarial valuations and experience
studies to supplement those performed by the commission-retained
actuary. Any supplemental actuarial valuation or experience
studies shall be filed with the executive director of the
legislative commission on pensions and retirement.
Sec. 23. Minnesota Statutes 1986, section 352B.08,
subdivision 2, is amended to read:
Subd. 2. [NORMAL RETIREMENT ANNUITY.] The annuity shall be
paid in monthly installments. The annuity shall be equal to
that portion of the amount determined by multiplying the average
monthly salary of the member multiplied by 2-1/2 percent for
each year and pro rata for completed months of service not
exceeding 25 years and two percent for each year and pro rata
for completed months of service in excess of 25 years. "Average
monthly salary" shall mean the average of the monthly salaries
for the five high years of service as a member. The monthly
salary for the period prior to July 2, 1969 shall be deemed to
be $600. The term "average monthly salary" shall not include
any amounts of severance pay or any reduced salary paid during
the period the person is entitled to benefit payments from the
workers' compensation court of appeals for temporary disability.
Subd. 3. [OPTIONAL ANNUITY FORMS.] In lieu of the single
life annuity herein provided in subdivision 2, the member or
former member with ten years or more of service may elect an
optional annuity form. The board of the Minnesota state
retirement system shall establish a joint and survivor annuity,
payable to a designated beneficiary for life, adjusted to the
actuarial equivalent value of the single life annuity.
The board shall also establish an additional optional annuity
with an actuarial equivalent value of the single life annuity in
the form of a joint and survivor annuity elected by a member may
also provide which provides that the elected annuity be
reinstated to the single life annuity herein provided in
subdivision 2, if after drawing commencing the elected joint and
survivor annuity, the designated beneficiary dies prior to the
death of before the member. This, which reinstatement shall not
be retroactive but shall be in effect for the first full
month subsequent to occurring after the death of the designated
beneficiary. This additional joint and survivor option with
reinstatement clause shall be adjusted to the The board may also
establish other actuarial equivalent value optional annuity
forms. In establishing actuarial equivalent value of optional
annuity forms, each optional annuity form shall have the same
present value as a regular single life annuity using the
mortality table adopted by the board and the interest assumption
specified in section 356.215, subdivision 4d and the board shall
obtain the written recommendation of the commission-retained
actuary. These recommendations shall be a part of the permanent
records of the board.
Sec. 24. Minnesota Statutes 1986, section 352B.26,
subdivision 3, is amended to read:
Subd. 3. [VALUATION OF ASSETS; ADJUSTMENT OF BENEFITS.]
(1) For those former members commencing to receive beginning
receipt of annuities and qualified recipients of joint and
survivor annuities and surviving spouse benefits, the required
reserves shall be determined in accordance with the appropriate
mortality table, calculated with an adopted by the board of
directors of the Minnesota state retirement system based on the
experience of the fund as recommended by the commission-retained
actuary and using the interest assumption set at the interest
rate specified in section 356.215, subdivision 4d, and. Assets
representing the required reserves for these annuities shall be
transferred to the Minnesota postretirement investment fund as
of the last business day of the month in which the retirement
annuity begins in accordance with procedures specified in
section 11A.18.
(2) Annuity payments shall be adjusted in accordance with
the provisions of section 11A.18.
(3) Notwithstanding section 356.18, increases an increase
in annuity payments pursuant to this section shall be made
automatically unless written notice is filed by the annuitant
with the executive director of the Minnesota state retirement
system requesting that the increase not be made.
Sec. 25. Minnesota Statutes 1986, section 353.01,
subdivision 14, is amended to read:
Subd. 14. [ACTUARIAL EQUIVALENT.] "Actuarial equivalent"
means the annual amount determined by calculations based on
mortality tables, purchasable with a given amount at a stated
age condition of one annuity or benefit having an equal
actuarial present value as another annuity or benefit,
determined as of a given date with each actuarial present value
based on the appropriate mortality table adopted by the board of
trustees based on the experience of the fund as recommended by
the actuary retained by the legislative commission on pensions
and retirement and using the applicable preretirement or
postretirement interest rate assumption specified in section
356.215, subdivision 4d.
Sec. 26. Minnesota Statutes 1986, section 353.03,
subdivision 3a, is amended to read:
Subd. 3a. [EXECUTIVE DIRECTOR.] (a) [APPOINTMENT.] The
board shall appoint, with the advice and consent of the senate,
an executive director on the basis of education, experience in
the retirement field, and leadership ability. The executive
director shall have had at least five years' experience in an
executive level management position, which has included
responsibility for pensions, deferred compensation, or employee
benefits. The executive director serves at the pleasure of the
board. The salary of the executive director is as provided by
section 15A.081, subdivision 1.
(b) [DUTIES.] The management of the association is vested
in the executive director who shall be the executive and
administrative head of the association. The executive director
shall act as adviser to the board on all matters pertaining to
the association and shall also act as the secretary of the
board. The executive director shall:
(1) attend all meetings of the board;
(2) prepare and recommend to the board appropriate rules
for the purpose of carrying to carry out the provisions of this
chapter;
(3) establish and maintain an adequate system of records
and accounts following recognized accounting principles and
controls;
(4) designate an assistant director, with the approval of
the board, who shall serve in the unclassified service and whose
salary is set in accordance with section 43A.18, subdivision 3,
appoint a confidential secretary in the unclassified service,
and appoint employees to carry out this chapter, who are subject
to chapters 43A and 179A in the same manner as are executive
branch employees;
(5) organize the work of the association as the director
deems necessary to fulfill the functions of the association, and
define the duties of its employees and delegate to them any
powers or duties, subject to the control of, and under such
conditions as, the executive director may prescribe;
(6) with the approval of the board, contract for actuarial
the services of an approved actuary, professional management
services, and any other consulting services as necessary to
fulfill the purposes of this chapter. All contracts are subject
to chapter 16B. The commissioner of administration shall not
approve, and the association shall not enter into, any contract
to provide lobbying services or legislative advocacy of any
kind. Any approved actuary retained by the executive director
shall function as the actuarial advisor of the board and the
executive director and may perform actuarial valuations and
experience studies to supplement those performed by the actuary
retained by the legislative commission on pensions and
retirement. Any supplemental actuarial valuations or experience
studies shall be filed with the executive director of the
legislative commission on pensions and retirement. Copies of
all professional management survey reports shall be sent
directly transmitted to the legislature secretary of the senate,
the chief clerk of the house of representatives, and the
legislative reference library as provided by section 3.195, to
the executive director of the commission and to the legislative
auditor at the same time as reports are furnished to the board.
Only management firms experienced in conducting management
surveys of federal, state or local public retirement systems
shall be qualified to contract with the director hereunder;
(7) with the approval of the board provide inservice
training for all the employees of the association;
(8) make refunds of accumulated contributions to former
members and to the designated beneficiary, surviving spouse,
legal representative or next of kin of deceased members or
deceased former members, all as provided in this chapter;
(9) determine the amount of the annuities and disability
benefits of members covered by the association and authorize
payment thereof of the annuities and benefits beginning as of
the dates such on which the annuities and benefits begin to
accrue, all in accordance with the provisions of this chapter;
(10) pay annuities, refunds, survivor benefits, salaries
and all necessary operating expenses of the association;
(11) prepare and submit to the board and the legislature an
annual financial report covering the operation of the
association, as required by chapter 356 section 356.20;
(12) prepare and submit biennial and annual budgets to the
board for its approval and submit the approved budgets to the
department of finance for approval by the commissioner; and
(13) with the approval of the board, perform such other
duties as may be required for the administration of the
association and the other provisions of this chapter and for the
transaction of its business.
Sec. 27. Minnesota Statutes 1986, section 353.271, is
amended to read:
353.271 [PARTICIPATION IN MINNESOTA POSTRETIREMENT
INVESTMENT FUND.]
Subdivision 1. [AUTHORIZATION.] The public employees
retirement association, including the police and fire fund, is
hereby authorized to participate in the Minnesota postretirement
investment fund. There shall be one general participation in
the Minnesota postretirement investment fund for all purposes by
the public employees retirement association fund and one general
participation in the Minnesota postretirement investment fund
for all purposes by the public employees police and fire fund.
Subd. 2. [VALUATION OF ASSETS; ADJUSTMENT OF BENEFITS.]
(1) For members retiring, The required reserves for retirement
annuities pursuant to this chapter as determined in accordance
with the appropriate mortality table adopted by the board of
trustees based on the experience of the fund as recommended by
the commission-retained actuary and using the postretirement
interest assumption specified in section 356.215, subdivision
4d, shall be transferred to the Minnesota postretirement
investment fund as of the date of retirement last business day
of the month in which the retirement annuity begins.
(2) Annuity payments shall be adjusted in accordance with
the provisions of section 11A.18.
(3) Notwithstanding section 356.18, increases in payments
pursuant to this section will be made automatically unless the
intended recipient files written notice with the executive
director of the public employees retirement association
requesting that the increase shall not be made.
Sec. 28. Minnesota Statutes 1986, section 353.29,
subdivision 6, is amended to read:
Subd. 6. [RETIREMENT BEFORE ELIGIBILITY FOR SOCIAL
SECURITY BENEFITS.] Any member who retires before becoming
eligible for social security retirement benefits may elect to
receive a an optional retirement annuity from the association in
an amount greater than the annuity computed on the basis of age
at retirement, provided in subdivisions 2 and 3 which provides
for different annuity amounts over different periods of
retirement. The election of this option optional retirement
annuity shall be exercised by making application to the board of
trustees. This The optional annuity shall take the form of an
annuity payable for the period before the annuitant becomes
eligible for social security old age retirement benefits in a
greater amount than the amount of the annuity calculated under
subdivisions 2 and 3 on the basis of the age of the annuitant at
retirement but equal insofar as possible to the social security
old age retirement benefit and the adjusted retirement annuity
amount payable immediately after the annuitant becomes eligible
for social security old age retirement benefits in an amount
less than the amount of the annuity calculated under
subdivisions 2 and 3 on the basis of the age of the annuitant at
retirement. The social security leveling option may be
calculated based on broad average social security old age
retirement benefits. The optional annuity shall be the
actuarial equivalent of the normal retirement annuity computed
on the basis of age at retirement. This greater amount shall be
paid until the annuitant reaches the age of 62, at which time
the payment from the association shall be reduced. The method
of computing an the optional retirement annuity under this
subdivision shall be determined established by an approved
actuary the board of trustees. In establishing the method of
computing the optional retirement annuity, the board of trustees
shall obtain the written recommendation of the
commission-retained actuary. The recommendations shall be a
part of the permanent records of the board of trustees.
Sec. 29. Minnesota Statutes 1986, section 353.30,
subdivision 3, is amended to read:
Subd. 3. [OPTIONAL RETIREMENT ANNUITY FORMS.] The board of
trustees shall establish optional annuities which shall take the
form of a joint and survivor annuity. Such The optional annuity
forms shall be actuarially equivalent to the forms provided in
section 353.29 and subdivisions 1, 1a, 1b, and 1c of this
section. In establishing those optional forms, the board shall
obtain the written recommendation of an approved the
commission-retained actuary and these. The recommendations
shall be a part of the permanent records of board. A member or
former member may select an optional form of annuity in lieu of
accepting any other form of annuity which might otherwise be
available.
Sec. 30. Minnesota Statutes 1986, section 354.05,
subdivision 7, is amended to read:
Subd. 7. [ACTUARIAL EQUIVALENT.] "Actuarial equivalent"
means the annual amount determined by calculations based on
mortality tables, purchasable with a given amount at a stated
age condition of one annuity or benefit having an equal
actuarial present value as another annuity or benefit,
determined as of a given date with each actuarial present value
based on the appropriate mortality table adopted by the board of
trustees based on the experience of the fund as recommended by
the actuary retained by the legislative commission on pensions
and retirement and using the applicable preretirement or
postretirement interest rate assumption specified in section
356.215, subdivision 4d.
Sec. 31. Minnesota Statutes 1986, section 354.06,
subdivision 2a, is amended to read:
Subd. 2a. [DUTIES OF EXECUTIVE DIRECTOR.] The management
of the association is vested in the executive director who shall
be the executive and administrative head of the association.
The executive director shall act as advisor to the board on all
matters pertaining to the association and shall also act as the
secretary of the board. The executive director shall:
(1) Attend all meetings of the board;
(2) Prepare and recommend to the board appropriate rules
for the purpose of carrying to carry out the provisions of this
chapter;
(3) Establish and maintain an adequate system of records
and accounts following recognized accounting principles and
controls;
(4) Designate an assistant executive director in the
unclassified service and two assistant executive directors in
the classified service with the approval of the board, and
appoint such employees, both permanent and temporary, as are
necessary to carry out the provisions of said chapter;
(5) Organize the work of the association as the director
deems necessary to fulfill the functions of the association, and
define the duties of its employees and delegate to them any
powers or duties, subject to the director's control and under
such conditions as the director may prescribe;
(6) With the approval of the board, contract for actuarial
the services of an approved actuary, professional management
services, and any other consulting services as may be necessary
and fix the compensation therefor. Such contracts shall not be
subject to the competitive bidding procedure prescribed by
chapter 16 16B. Professional management services may not be
contracted for more often than once in every six years. Any
approved actuary retained by the executive director shall
function as the actuarial advisor of the board and the executive
director and may perform actuarial valuations and experience
studies to supplement those performed by the actuary retained by
the legislative commission on pensions and retirement. Any
supplemental actuarial valuations or experience studies shall be
filed with the executive director of the legislative commission
on pensions and retirement. Copies of all professional
management survey reports shall be sent directly transmitted to
the legislature secretary of the senate, the chief clerk of the
house of representatives, and the legislative reference library
as provided by section 3.195, to the executive director of the
commission and to the legislative auditor at the same time as
reports are furnished to the board. Only management firms
experienced in conducting management surveys of federal, state
or local public retirement systems shall be qualified to
contract with the director hereunder;
(7) With the approval of the board, provide inservice
training for all the employees of the association;
(8) Make refunds of accumulated contributions to former
members and to the designated beneficiary, surviving spouse,
legal representative or next of kin of deceased members or
deceased former members, all as provided in this chapter;
(9) Determine the amount of the annuities and disability
benefits of members covered by the association and authorize
payment thereof of the annuities and benefits beginning as of
the dates such on which the annuities and benefits begin to
accrue, all in accordance with the provisions of said this
chapter;
(10) Pay annuities, refundments refunds, survivor benefits,
salaries and all necessary operating expenses of the association;
(11) Prepare and submit to the board and the legislature an
annual financial report covering the operation of the
association, as required by chapter 356 section 356.20;
(12) Certify funds available for investment to the state
board of investment;
(13) With the advice and approval of the board, request the
state board of investment to sell securities on determining that
funds are needed for the purposes of the association;
(14) Prepare and submit biennial and annual budgets to the
board and with the approval of the board submit such those
budgets to the department of administration finance; and
(15) With the approval of the board, perform such other
duties as may be required for the administration of the
association and the other provisions of this chapter and for the
transaction of its business.
Sec. 32. Minnesota Statutes 1986, section 354.07,
subdivision 1, is amended to read:
Subdivision 1. [GENERAL POWERS OF THE BOARD.] The board
shall have, and is hereby granted, has the power to frame bylaws
for its own government and for the management of the fund not
inconsistent with the laws of the state and to modify them
at its pleasure; to adopt, alter, and enforce reasonable rules
not inconsistent with the laws of the state for the
administration and management of the fund, for the payment and
collection of payments from members, and for the payment of
withdrawals and benefits; to pass upon and allow or disallow all
applications for membership in the fund and for credit for
teaching service; to pass upon and allow or disallow all claims
for withdrawals, pensions, or benefits payable from the fund; to
adopt an appropriate mortality table based on experience of the
fund as recommended by the association commission-retained
actuary, with and using the applicable postretirement interest
set at the rate assumption specified in section 356.215,
subdivision 4d; to provide for the payment out of the fund
of all necessary expenses for the administration thereof of the
fund and of all claims for withdrawals, pensions, or benefits
allowed.
Sec. 33. Minnesota Statutes 1986, section 354.35, is
amended to read:
354.35 [RETIREMENT BEFORE BECOMING ELIGIBLE FOR SOCIAL
SECURITY.]
Any coordinated member who retires before becoming eligible
for social security retirement benefits, may elect to receive an
optional retirement benefits annuity from the association in an
amount greater than the member's annuity computed on the basis
of the member's age at retirement which provides for different
annuity amounts over different periods of retirement. The
member shall exercise election of this option optional
retirement annuity shall be exercised by making an application
to the board on a form provided by the board. This The optional
annuity shall take the form of an annuity payable for the period
before the member attains the age of 65 years in a greater
amount than the amount of the annuity calculated under section
354.44 on the basis of the age of the member at retirement but
equal insofar as possible to the social security old age
retirement benefit and the adjusted retirement annuity amount
payable immediately after the annuitant becomes eligible for
social security old age retirement benefits in an amount less
than the amount of the annuity calculated under section 354.44
on the basis of the age of the member at retirement. The social
security leveling option may be calculated based on broad
average social security old age retirement benefits. The
optional annuity shall be the actuarial equivalent of the
member's annuity computed on the basis of the member's age at
retirement. The greater amount shall be paid until the member
reaches the age of 65 at which time the payment from the
association shall be reduced. These annuities The method of
computing the optional retirement annuity provided in this
section shall be computed by an approved actuary established by
the board of trustees. In establishing the method of computing
the optional retirement annuity, the board of trustees shall
obtain the written recommendation of the commission-retained
actuary. The recommendations shall be a part of the permanent
records of the board of trustees.
Sec. 34. Minnesota Statutes 1986, section 354.42,
subdivision 5, is amended to read:
Subd. 5. [ADDITIONAL EMPLOYER CONTRIBUTION.] For the
purpose of amortizing To amortize the unfunded entry-age normal
actuarial accrued liability computed under the entry age
actuarial cost method and disclosed under the annual actuarial
valuations prepared by the commission-retained actuary under
section 356.215, an additional employer contribution shall be
made in the amount of 4.48 percent of the salary of each
member. For the fiscal year ending June 30, 1985, the
commissioner of finance shall increase allotments to state
agencies having members covered by the teachers retirement
association in an amount equal to 1.43 percent of the salaries
of basic and coordinated plan members of the teachers'
retirement fund.
This contribution shall be made in the manner provided in
section 354.43.
Sec. 35. Minnesota Statutes 1986, section 354.44,
subdivision 2, is amended to read:
Subd. 2. [COMPUTATION OF MONEY PURCHASE ANNUITY.] The
amount of retirement annuity is an amount equal to double the
annuity which could be purchased by the member's accumulated
deductions plus interest thereon. The annuity shall be
determined by the member's age, sex, double the amount of
accumulated deductions, double the interest earned on the
accumulated deductions, and the appropriate mortality tables and
interest rates. For the purpose of determining To determine the
amount of the annuity for a basic member, the accumulated
deductions prior to July 1, 1957, and the accumulated deductions
subsequent to July 1, 1957, shall be considered separately.
(1) For service rendered prior to July 1, 1957, the
accumulated deductions for any member shall be carried forward
at a fixed amount which is shown credited to the member's
account as of that date. That fixed amount shall also include
any payments in lieu of salary deductions which are to be made
in the future and are actually so made pursuant to an agreement
executed between the member and the board as authorized by
section 354.50 or any other authorized payments made by the
member to the fund. The annuity granted with respect to such
the period shall be determined by the following as follows:
(a) The fixed amount of the accumulated deductions for such
the period including the interest credited thereon on the amount
as earned up to July 1, 1957.
(b) Annuity purchase rates based on the applicable
mortality tables table established by the board and the interest
rate assumption used by the board in effect prior to July 1,
1957, in the case of basic members and an annuity purchase rate
based on an appropriate annuity table of mortality with an
interest assumption established by the board as provided in
section 354.07, subdivision 1, and using the applicable
postretirement interest rate assumption specified in section
356.215, subdivision 4d in the case of coordinated members.
(2) For service rendered subsequent to July 1, 1957, the
accumulated deductions for any member shall consist of the
amounts actually credited to the member's account by reason of
salary deductions. The annuity granted with respect to such the
period shall be determined by the following:
(a) accumulated deductions for such the period;
(b) interest credited on these accumulated deductions from
July 1, 1957, to the date of retirement;
(c) interest credited on accumulated deductions including
prior credited interest provided in paragraph (1) from July 1,
1957, to the date of retirement;
(d) after the amount available for an annuity granted with
respect to such the person is determined in accordance with the
provisions of this subdivision, an additional amount equal to 20
percent of the sum of clause (2) (a) plus interest credited to
members account from July 1, 1957, to date of retirement is to
be added. This added amount is not to be doubled as provided
for other amounts determined in this subdivision;
(e) annuity purchase rate based on an appropriate annuity
table of mortality with an interest assumption established by
the board as provided in section 354.07, subdivision 1, and
using the applicable postretirement interest rate assumption
specified in section 356.215, subdivision 4d.
Sec. 36. Minnesota Statutes 1986, section 354.45, is
amended to read:
354.45 [OPTIONAL RETIREMENT ANNUITIES; UNPAID ANNUITIES,
DISPOSITION.]
Subdivision 1. [OPTIONAL ANNUITY FORMS.] The retirement
board shall establish optional annuities at retirement which
shall take the form of an annuity payable for a period certain
and for life thereafter; or as the form of a joint and survivor
annuity. The board shall also establish an optional annuity
which shall take the form of a guaranteed refund annuity paying
the annuitant a fixed amount for life with the guarantee that in
the event of death the balance of the accumulated deductions and
interest accrued to the date of retirement will be paid to the
designated beneficiary. Such Any optional annuity forms shall
be actuarially equivalent to the normal forms provided in
section 354.44. In establishing these optional annuity forms,
the board shall obtain the written recommendation of an approved
the commission-retained actuary and these. The recommendations
shall be a part of the permanent records of the board.
Subd. 2. [REFUND UPON DEATH OF RETIRED MEMBER.] Upon the
death of the member after retirement where no designated
beneficiary shall survive the member, any remaining unpaid
guaranteed annuity payments shall be commuted at the applicable
postretirement interest rate of interest currently being used in
determining the amount of optional annuities specified in
section 356.215, subdivision 4d and paid in one sum to the
estate of the member. Upon the death of the last designated
beneficiary after the death of the member, the value of any
unpaid guaranteed annuity payments shall be commuted at
the applicable postretirement interest rate of interest
currently being used in determining the amount of optional
annuities specified in section 356.215, subdivision 4d and paid
in one sum to the estate of such the designated beneficiary.
Sec. 37. Minnesota Statutes 1986, section 354.48,
subdivision 3, is amended to read:
Subd. 3. [COMPUTATION OF BENEFITS.] (1) The amount of the
disability benefit granted to members covered under section
354.44, subdivision 2, clauses (1) and (2), is an amount equal
to double the annuity which could be purchased by the member's
accumulated deductions plus interest thereon on the amount
computed as though the teacher were age 65 at the time the
benefit begins to accrue and in accordance with the law in
effect when the disability application is received. Any member
who applies for a disability benefit after June 30, 1974, and
who failed to make an election pursuant to Minnesota Statutes
1971, section 354.145, shall have the disability benefit
computed under the provisions of this clause or clause (2),
whichever is larger.
The benefit granted shall be determined by the following:
(a) the amount of the accumulated deductions;
(b) interest actually earned on these accumulated
deductions to the date the benefit begins to accrue;
(c) interest for the years from the date the benefit begins
to accrue to the date such the member attains age 65 at the rate
of three percent;
(d) annuity purchase rates based on an appropriate annuity
table of mortality with established by the board as provided in
section 354.07, subdivision 1, and using the applicable
postretirement interest of five percent rate assumption
specified in section 356.215, subdivision 4d.
In addition, a supplementary monthly benefit shall be paid
to basic members only in accordance with the following table:
Age When Benefit Supplementary
Begins to Accrue Benefit
Under Age 56 $50
56 45
57 40
58 35
59 30
60 25
61 20
62 15
63 10
64 5
(2) The disability benefit granted to members covered under
section 354.44, subdivision 6 or 7 shall be computed in the same
manner as the annuity provided in subdivision 6 or 7 of that
section, whichever is applicable. The disability benefit shall
be the formula annuity without the reduction for each month the
member is under age 65 at the time when the benefit begins to
accrue.
(3) For the purposes of computing a retirement annuity when
the member becomes eligible, the amounts paid for disability
benefits shall not be deducted from the individual member's
accumulated deductions. If the disability benefits provided in
this subdivision exceed the monthly average salary of the
disabled member, the disability benefits shall be reduced to an
amount equal to the disabled member's average salary.
Sec. 38. Minnesota Statutes 1986, section 354.532,
subdivision 1, is amended to read:
Subdivision 1. [CALCULATION OF PRESENT VALUE.] For the
persons entitled to purchase prior service credit under section
354.531, there shall be paid to the applicable retirement fund
or association an amount equal to the present value, on the date
of payment, of the amount of the additional service pension or
retirement annuity which would be obtained by virtue of the
purchase of the additional service credit, using the applicable
postretirement interest rate specified in section 356.215,
subdivision 4d, and the applicable mortality table adopted for
established by the board of the appropriate retirement fund or
association under section 354.07, subdivision 1, and assuming
continuous service until, and retirement at, the normal
retirement age with the additional service credit purchased, for
the appropriate retirement fund or association, or the age at
the date of payment or of the agreement to pay, whichever is
older, and a future salary history which includes annual salary
increases at the rate of salary increase rate assumption
specified in section 356.215, subdivision 4, clause (4) 4d. The
person requesting the purchase of prior service must establish
in the records of the retirement fund or association proof of
the service for which the purchase of prior service is
requested. The manner of the proof of service shall be in
accordance with procedures prescribed by the board of
trustees of the fund or association or by the executive director.
Sec. 39. Minnesota Statutes 1986, section 354.532,
subdivision 2, is amended to read:
Subd. 2. [PAYMENT OF PRESENT VALUE; CREDITING OF SERVICE.]
Payment shall be made in one lump sum, unless the executive
director of the appropriate retirement fund or association
agrees to accept payment in installments over a period of not to
exceed three years from the date of the agreement, with interest
at a rate deemed appropriate by the executive director. The
period of allowable service shall be credited to the account of
the person only after receipt of full payment by the executive
director.
Sec. 40. Minnesota Statutes 1986, section 354.55,
subdivision 11, is amended to read:
Subd. 11. [DEFERRED ANNUITY; AUGMENTATION.] Any person
covered under section 354.44, subdivisions 6 and 7, who ceases
to render teaching service may leave the person's accumulated
deductions in the fund for the purpose of receiving a deferred
annuity at retirement. Eligibility for an annuity under this
subdivision shall be governed pursuant to section 354.44,
subdivision 1, or 354.60.
The amount of the deferred retirement annuity shall be
determined by section 354.44, subdivisions 6 and 7, and
augmented as provided herein in this subdivision. The required
reserves related to that portion of the annuity which had
accrued at the time when the member ceased to render teaching
service shall be augmented by interest compounded annually from
the first day of the month following the month during which the
member ceased to render teaching service to the effective date
of retirement. There shall be no augmentation if this period is
less than three months or if this period commences prior to July
1, 1971. The rates of interest used for this purpose shall be
five percent commencing July 1, 1971, until January 1, 1981, and
three percent thereafter. If a person has more than one period
of uninterrupted service, a separate average salary determined
under section 354.44, subdivision 6, must be used for each
period and the required reserves related to each period shall be
augmented by interest pursuant to this subdivision. The sum of
the augmented required reserves so determined shall be the basis
for purchasing the deferred annuity. If a person does not
render teaching service in any one fiscal year or more
consecutive fiscal years and then resumes teaching service, the
formula percentages used from the date of the resumption will of
teaching service shall be those applicable to new members. The
mortality table and interest assumption contained therein used
to compute the annuity shall be determined by the law applicable
mortality table established by the board under section 354.07,
subdivision 1, and the interest rate assumption under section
356.215 in effect at the time of the member's retirement when
the member retires. A period of uninterrupted service for the
purposes of this subdivision shall mean means a period of
covered teaching service during which the member has not been
separated from active service for more than one fiscal year.
The provisions of this subdivision shall not apply to
variable account accumulations as defined in section 354.05,
subdivision 23.
In no case shall the annuity payable herein under this
subdivision be less than the amount of annuity payable pursuant
to section 354.44, subdivisions 6 and 7.
The requirements and provisions for retirement prior to
before age 65 contained in section 354.44, subdivision 6, clause
(2) shall also apply to an employee fulfilling the requirements
with a combination of service as provided in section 354.60.
The augmentation provided by this subdivision shall not
apply to any period in which a person is on an approved leave of
absence from an employer unit covered by the provisions of this
chapter.
Sec. 41. Minnesota Statutes 1986, section 354.55,
subdivision 12, is amended to read:
Subd. 12. [PRE-1973 LAW RETIREMENTS.] When Any member who
retires under the law in effect prior to July 1, 1973 shall have
that portion of the member's annuity based on accumulations
after June 30, 1957, under the provisions of Minnesota Statutes
1971, section 354.44, subdivision 2 and all accumulations under
the provisions of Minnesota Statutes 1971, section 354.33,
subdivision 1 shall be calculated using the same mortality table
established by the board under section 354.07, subdivision 1 and
the interest rate assumption specified in section 356.215 used
at the time of that retirement to transfer the required reserves
to the Minnesota postretirement investment fund.
Sec. 42. Minnesota Statutes 1986, section 354.55,
subdivision 13, is amended to read:
Subd. 13. [PRE-1969 LAW RETIREMENTS.] Any person who
ceased teaching service prior to July 1, 1968, who has ten years
or more of allowable service and left accumulated deductions in
the fund for the purpose of receiving when eligible a retirement
annuity, and retires shall have the annuity computed in
accordance with the law in effect on June 30, 1969, except that
the portion of the annuity based on accumulations after June 30,
1957, under the provisions of Minnesota Statutes 1967, section
354.44, subdivision 2, and all accumulations under the
provisions of Minnesota Statutes 1967, section 354.33,
subdivision 1, shall be calculated using the same mortality
table established by the board under section 354.07, subdivision
1, and the interest rate assumption used specified in section
356.215, to transfer the required reserves to the Minnesota
postretirement investment fund.
Sec. 43. Minnesota Statutes 1986, section 354.58, is
amended to read:
354.58 [SUPPLEMENTAL RETIREMENT ANNUITY.]
A supplemental retirement annuity shall be paid only to a
member who retires pursuant to section 354.44, subdivision 2,
and the options related thereto applicable optional retirement
annuities as established in sections 354.35 and 354.45. In
establishing this supplemental retirement annuity, the board
shall ascertain the member's accumulated deduction including
interest for the period of allowable service prior to July 1,
1957, and the member shall receive a retirement credit of 100
percent of this amount. The retirement credit so established
shall be the basis for purchasing a supplemental retirement
annuity using an annuity purchase rate based on an appropriate
the applicable annuity table of mortality with an interest
assumption as provided in section 354.07, subdivision 1. This
supplemental retirement annuity shall be doubled.
Sec. 44. Minnesota Statutes 1986, section 354.62,
subdivision 5, is amended to read:
Subd. 5. [VARIABLE RETIREMENT ANNUITY.] (1) At retirement,
the amount of the member's variable account accumulation in the
employee variable annuity contribution account, based on the
valuation at the previous fiscal year end plus any contributions
made by the person since the end of the previous fiscal year,
and an equal amount from the employer variable annuity
contribution account shall be transferred to the variable
annuity reserve account, and the variable retirement annuity for
the member shall be determined by the member's age, and sex, and
the amount transferred for the member to the variable annuity
reserve account at the date of retirement. The amount of the
annuity shall be calculated on the basis of an appropriate
applicable annuity table of mortality with established by the
board of trustees under section 354.07, subdivision 1, using an
interest rate assumption of eight percent, except that if the
member elects to have the accumulation transferred to the
Minnesota postretirement investment fund as authorized by clause
(8), the amount of the annuity shall be calculated with using an
the applicable postretirement interest rate assumption of five
percent specified in section 356.215.
(2) Whenever If the admitted value of the annuity reserve
account of the variable annuity division, as of June 30 of any
year, exceeds or is less than the then present value of all
variable annuities in force, determined in accordance with the
rate of interest and approved actuarial tables then in effect,
by at least two percent of the present value, the amount of each
variable annuity payment shall be proportionately increased or
decreased for the following year.
(3) The death benefit payable in the event of a member's
death prior to retirement shall be a lump sum refund of a
member's variable account accumulation, based on the valuation
at the previous fiscal year end plus any contributions made by
the person since the end of the previous fiscal year, to the
surviving spouse, or if there is no surviving spouse to the
designated beneficiary. Except that If a member has made an
election in accordance with section 354.46, then the surviving
spouse shall receive a joint and survivor annuity as described
in section 354.44 and computed as provided in clause (1) in lieu
of a lump sum refund of a member's variable account
accumulation. If a lump sum refund of a member's variable
account accumulation is taken, an amount equal to the lump sum
refund made in this clause shall be transferred from the
employer contribution account to the variable annuity turnover
account.
(4) Except as provided in section 354.44, subdivision 7,
any person who ceases to be a member by reason of termination of
teaching service, shall be entitled to a lump sum refundment
refund of the member's variable account accumulations, based on
the valuation at the previous fiscal year end plus any
contributions made by the person since the end of the previous
fiscal year. Application for a refundment refund may be made no
sooner than 30 days after termination of teaching service if the
applicant has not again become a teacher. Repayment of
a refundment refund upon resumption of teaching is not permitted
under this section. An amount equal to the refundment refund to
the member shall be transferred from the employer contribution
account to the variable annuity turnover account.
(5) If a member is determined to be totally and permanently
disabled as provided in sections 354.05, subdivision 14; and
354.48, the member shall be entitled to the annuity provided in
this subdivision.
(6) Those members eligible for retirement as provided in
section 354.44, subdivision 1 shall, upon application for the
that annuity provided therein, be entitled to the annuity
provided in this subdivision. The annuity elected in accordance
with sections 354.35, 354.44, and 354.45 shall be the annuity
applicable to this subdivision.
(7) Notwithstanding section 356.18, increases an increase
in annuity payments pursuant to this section shall be made
automatically unless written notice is filed by the annuitant
with the executive director of the teachers retirement
association board requesting that the increase not be made.
(8) At retirement, a member may elect to have the amount of
the member's variable annuity accumulation in the employee
variable annuity contribution account and an equal amount from
the employer variable annuity contribution account transferred
to the Minnesota postretirement investment fund as provided in
section 354.63, subdivision 2, clause (2). This election may
also be made by a surviving spouse who receives an annuity under
clause (3). The election shall be made on a form provided by
the executive secretary director.
Sec. 45. Minnesota Statutes 1986, section 354.63,
subdivision 2, is amended to read:
Subd. 2. [VALUATION OF ASSETS; ADJUSTMENT OF BENEFITS.] (1)
Effective July 1, 1973 for those members retiring pursuant to
this chapter, The required reserves for retirement annuities as
determined in accordance with these sections this chapter shall
be transferred to the Minnesota postretirement investment fund
as of the date of retirement last business day of the month in
which the retirement annuity begins. An The required reserves
shall be determined in accordance with the appropriate annuity
table of mortality with an interest assumption adopted by the
board of trustees as provided in section 354.07, subdivision 1,
will be used to determine the amount to be transferred based on
the experience of the fund as recommended by the
commission-retained actuary and using the interest assumption
specified in section 356.215, subdivision 4d.
(2) Annuity payments shall be adjusted in accordance with
the provisions of section 11A.18. For the purpose of In making
these adjustments, members who retire effective July 1 shall be
considered to have retired effective the preceding June 30.
This section is applicable for applies to persons who retired
effective July 1, 1982 or later.
(3) Notwithstanding section 356.18, increases an increase
in annuity payments pursuant to this section will be made
automatically unless written notice is filed by the annuitant
with the executive director of the teachers retirement
association board requesting that the increase shall not be made.
Sec. 46. Minnesota Statutes 1986, section 354A.011, is
amended by adding a subdivision to read:
Subd. 3a. [ACTUARIAL EQUIVALENT.] "Actuarial equivalent"
means the condition of one annuity or benefit having an equal
actuarial present value as another annuity or benefit,
determined as of a given date with each actuarial present value
based on the appropriate mortality table adopted by the
appropriate board of trustees based on the experience of that
retirement fund association as recommended by the actuary
retained by the legislative commission on pensions and
retirement and using the applicable preretirement or
postretirement interest rate assumption specified in section
356.215, subdivision 4d.
Sec. 47. Minnesota Statutes 1986, section 354A.011,
subdivision 17, is amended to read:
Subd. 17. [OPTIONAL SURVIVORS ANNUITY.] "Optional
survivors annuity" means the payments made by the teachers
retirement fund association to a survivor of a former member
pursuant to an actuarial equivalent optional annuity
form established by the applicable board of trustees under
section 354A.32 and selected by the member at or before
retirement.
Sec. 48. Minnesota Statutes 1986, section 354A.021, is
amended by adding a subdivision to read:
Subd. 7. [ACTUARIAL CONSULTANT.] The board of trustees or
directors of each teachers retirement fund association may
contract for the services of an approved actuary and fix the
reasonable compensation for those services. Any approved
actuary retained by the board shall function as the actuarial
advisor to the board and may perform actuarial valuations and
experience studies to supplement those performed by the actuary
retained by the legislative commission on pensions and
retirement. Any supplemental actuarial valuations or experience
studies shall be filed with the executive director of the
legislative commission on pensions and retirement.
Sec. 49. Minnesota Statutes 1986, section 354A.32, is
amended to read:
354A.32 [OPTIONAL RETIREMENT ANNUITIES.]
Subdivision 1. [OPTIONAL FORMS GENERALLY.] The boards of
the Minneapolis and the St. Paul teachers retirement fund
associations shall each establish for the coordinated program
and the board of the Duluth teachers retirement fund association
shall establish for the new law coordinated program an optional
retirement annuity which shall take the form of a joint and
survivor annuity. Each board may also in its discretion
establish an optional annuity which shall take the form of an
annuity payable for a period certain and for life thereafter.
Each board shall also establish an optional retirement annuity
which shall take the form of a guarantee that in the event of
death the balance of the accumulated deductions shall be paid to
a designated beneficiary. All Optional annuity forms shall be
the actuarial equivalent of the normal forms provided in section
354A.31. In establishing these optional annuity forms, the
board shall obtain the written recommendation of an approved the
commission-retained actuary and. The recommendation shall be a
part of the permanent records of the board.
Subd. 2. [SPECIAL OPTIONAL ANNUITY PROVISIONS.] In the
event of the death of the designated beneficiary of a retired
member who had elected an optional annuity in the form of a
joint and survivor annuity under subdivision 1, the retired
member shall thereafter receive the unreduced amount of the
earned benefit computed pursuant to 354A.31. The effect of this
provision shall be reflected in calculating the actuarial
equivalent joint and survivor annuity under subdivision 1.
Sec. 50. Minnesota Statutes 1986, section 354A.33, is
amended to read:
354A.33 [SOCIAL SECURITY LEVELING ADJUSTMENT OPTION.]
Any coordinated member who retires prior to the time the
member becomes eligible for social security old age retirement
benefits shall be entitled to elect to receive a social security
leveling adjustment optional annuity from the teachers
retirement fund association. The social security leveling
adjustment optional annuity shall be established by the board of
the teachers retirement fund association. It shall take the
form of an annuity payable for the period prior to the member's
becoming eligible for social security old age retirement
benefits in an amount greater than the amount of the member's
annuity calculated pursuant to section 354A.31 on the basis of
the age of the member at retirement but equal insofar as
possible to the social security old age retirement benefit and
the adjusted retirement annuity amounts payable immediately
subsequent to becoming eligible for social security old age
retirement benefits in an amount less than the amount of the
member's annuity calculated pursuant to section 354A.31 on the
basis of the age of the member at retirement. The optional form
shall be the actuarial equivalent to the normal forms provided
in section 354A.31. In establishing the optional form, the
board shall obtain the written recommendation of an approved the
commission-retained actuary and the recommendation shall be a
part of the permanent records of the board.
Sec. 51. Minnesota Statutes 1986, section 354A.41,
subdivision 2, is amended to read:
Subd. 2. [ACTUARIAL VALUATIONS.] Whenever In any actuarial
valuation of the Minneapolis teachers retirement fund
association or, the St. Paul teachers retirement fund
association shall make an actuarial valuation as required by
section 356.215 after July 1, 1979, there shall be included in
the report of the actuarial valuation a finding of the condition
of the fund showing separately the basic and coordinated
programs and whenever, or the Duluth teachers retirement fund
association shall make an actuarial valuation as required
by under section 356.215 after July 1, 1981 prepared by the
commission-retained actuary or supplemental actuarial valuation
prepared by an approved actuary retained by the teachers
retirement fund association, there shall be included in the
report of the actuarial valuation a finding of the condition of
the fund showing separately the basic and coordinated programs
or the old law coordinated and new law coordinated programs, as
appropriate. The finding shall include the level normal cost,
accrued liability, assets, unfunded accrued liability,
contribution required to meet the interest at the assumed rate
on the unfunded accrued liability, and the contribution required
to amortize the unfunded accrued liability by the date specified
in section 356.215, subdivision 4g, and the applicable employee
and employer contribution rates for each program.
Sec. 52. Minnesota Statutes 1986, section 356.20,
subdivision 2, is amended to read:
Subd. 2. [COVERED PUBLIC PENSION FUNDS.] (1) State
employees retirement fund.
(2) Public employees retirement fund.
(3) Teachers retirement fund.
(4) State patrol retirement fund.
(5) Minneapolis teachers retirement fund association.
(6) St. Paul teachers retirement fund association.
(7) Duluth teachers retirement fund association.
(8) Minneapolis employees retirement fund.
(9) University of Minnesota faculty retirement plan.
(10) University of Minnesota faculty supplemental
retirement plan.
(11) Judges retirement fund.
(12) Any police or firefighters' relief association
enumerated in section 69.77, subdivision 1a or 69.771,
subdivision 1.
(13) Public employees police and fire fund.
(14) Minnesota state retirement system correctional
officers retirement plan fund.
Sec. 53. Minnesota Statutes 1986, section 356.20,
subdivision 3, is amended to read:
Subd. 3. [FILING REQUIREMENT.] Each The financial report
is a public record. A copy thereof of the report or a synopsis
of the report containing the information required by this
section shall be distributed annually to each member of the fund
and to the governing body of each governmental subdivision of
the state which makes employers contributions thereto or in
whose behalf taxes are levied for the employers' contribution.
A signed copy of each the report shall be delivered not later
than six months after the close of each fiscal year to the
executive director of the legislative commission on pensions and
retirement and to the legislative reference library not later
than six months after the close of each fiscal year or one month
following the completion and delivery to the retirement fund of
the actuarial valuation report of the fund by the actuary
retained by the legislative commission on pensions and
retirement, if applicable, whichever is later.
Sec. 54. Minnesota Statutes 1986, section 356.20,
subdivision 4, is amended to read:
Subd. 4. [CONTENTS OF FINANCIAL REPORT.] Each The
financial report required by this section shall include:
(1) An exhibit prepared based on the actuarial valuation
prepared by the commission-retained actuary according to
applicable actuarial standards requirements enumerated in
section 356.215, and specified in standards adopted by the
legislative commission on pensions and retirement by an approved
actuary as defined in section 356.215, subdivision 6 showing.
The exhibit shall show the accrued assets of the fund, the
accrued liabilities, including accrued reserves, and the accrued
unfunded actuarial accrued liability of the fund. The exhibit
shall contain the certificate of an approved the actuary
certifying retained by the legislative commission on pensions
and retirement specifying that the required reserves for
any retirement, disability, or survivor benefits provided under
a benefit formula are computed in accordance with the entry
age Normal Cost (Level Normal Cost) actuarial cost method and
any applicable standards adopted by the legislative commission
on pensions and retirement.
(a) Assets shown in the exhibit shall include the following
items of actual assets:
Cash in office
Deposits in banks
Accounts receivable:
Accrued members' contributions
Accrued employer contributions
Other
Accrued interest on investments
Dividends on stocks, declared but not yet received
Investment in bonds at cost
Investment in stocks at cost
Investment in real estate
Equipment at cost, less depreciation
Other
Total assets ........................ .
(b) The exhibit shall include a statement of the actuarial
value of current assets as specified in section 356.215,
subdivision 4, including:
Cash and, cash equivalents, and short-term securities
Fixed income investments
Equity investments
Real estate investments
Equity in the Minnesota postretirement investment fund
Other
(c) The exhibit shall include a statement of the
unfunded actuarial accrued liability of the fund which shall
include the following measures of unfunded actuarial accrued
liability, using the actuarial value of current assets as
specified in section 356.215, subdivision 4 1:
(i) unfunded actuarial accrued liability, which shall be
determined by subtracting the current assets and the present
value of future normal costs from the total current and expected
future benefit obligations; and
(ii) current unfunded actuarial liability, which is the
total current benefit obligations less the total current assets;
and
(iii) current and future unfunded actuarial liability,
which is the total current and expected future benefit
obligations less the total current and expected future assets.
If the assets of the fund exceed the actuarial liabilities,
the excess shall be listed as a surplus and indicated in the
exhibit following the itemization of benefit obligations.
(d) The exhibit shall include a footnote showing
accumulated member contributions without interest.
(e) Current liabilities shown in the exhibit shall include
the following items:
Current:
Accounts payable
Retirement annuity payments
Disability benefit payments
Survivor benefit payments
Refund to members
Accrued expenses
Suspense items
Total current liabilities ........................ .
(f) The exhibit shall include a schedule which shall be
listed as the "current and expected future benefit
obligations." The schedule shall contain the following
information on the benefit obligations:
1. Current benefit obligations:, which shall be the
actuarial value of benefit obligations on account of service
rendered to date, separately identified as follows
(a) For annuitants
Retirement annuities
Disability annuities benefits
Surviving spouses' annuities spouse and child benefits
Surviving children's annuities
(b) For former members without vested rights
(c) For deferred annuitants' benefits, including
any augmentation
(d) For active employees
Retirement benefits annuities
Disability benefits
Refund liability due to death or
withdrawal
Survivors' benefits
Total current benefits obligations
2. Expected future benefit obligations:, which shall be
the actuarial value of benefit obligations on account of future
service for active employees
3. Total current and expected future benefit obligations
4. In addition to the foregoing, if there are additional
benefits not appropriately covered by the foregoing three items
of benefit obligations, they shall be listed separately.
(2) An income statement prepared on an accrual basis
showing all income and all deductions from income for the fiscal
year. The statement shall show separate items for employee
contributions, employer regular contributions, employer
additional contributions if provided by law, investment income,
profit on the sale of investments, and other income, if any.
(3) A statement of deductions from income, which shall
include separate items for benefit payments, the payment of
retirement benefits annuities, disability benefits, surviving
spouse benefits, surviving children's benefits, refunds to
members terminating employment, refunds due to death of members
and due to death of annuitants, the increase in total reserves
required, general administrative expense incurred, loss on sale
of investments, and any other deductions.
(4) A statement showing appropriate statistics as to
concerning the membership and beneficiaries of the fund, with
indications of changes in the statistical data which may result
from the current year's operation.
(5) Any additional statements or exhibits which will enable
the management of the fund to portray a true interpretation of
the fund's financial condition, except that the term "surplus"
or the term "excess of assets" shall not be used except as
otherwise specifically provided for in this section, nor shall
any representation of assets and liabilities other than as
provided for in this section be included in the additional
statements or exhibits.
(6) A more detailed or subdivided itemization of any of the
items required by this section, if the management of the fund so
desires.
Sec. 55. Minnesota Statutes 1986, section 356.215, is
amended to read:
356.215 [ACTUARIAL VALUATIONS AND EXPERIENCE STUDIES.]
Subdivision 1. [DEFINITIONS.] For the purposes of sections
3.85 and 356.20 to 356.23, each of the following terms
hereinafter defined shall have the meanings meaning given:
(1) "Actuarial valuation" means a calculation set of
calculations prepared by an approved actuary to determine the
normal cost and the accrued actuarial liabilities of a benefit
plan, according to a stated actuarial cost method and based upon
stated assumptions as including, but not limited to rates of
interest, mortality, salary increase, disability, withdrawal,
and retirement and a determination of to determine the payment
necessary to amortize over a stated period any unfunded
accrued actuarial liability disclosed as a result of the
actuarial valuation and the resulting actuarial balance sheet of
the benefit plan, and a determination of the payment necessary
to prevent any increase in any disclosed unfunded accrued
liability.
(2) "Approved actuary" means a person who is regularly
engaged in the business of providing actuarial services and who
has at least 15 years of service to major public employee
pension or retirement funds or who is a fellow in the society of
actuaries.
(3) "Entry age actuarial cost method" means an actuarial
cost method under which the actuarial present value of the
projected benefits of each individual currently covered by the
benefit plan and included in the actuarial valuation is
allocated on a level basis over the service of the individual if
the benefit plan is governed by section 69.773 or over the
earnings of the individual if the benefit plan is governed by
any other law between the entry age and the assumed exit age,
with the portion of this actuarial present value which is
allocated to the valuation year to be the normal cost and the
portion of this actuarial present value not provided for at the
valuation date by the actuarial present value of future normal
costs to be the actuarial accrued liability, with aggregation in
the calculation process to be the sum of the calculated result
for each covered individual and with recognition given to any
different benefit formulas which may apply to various periods of
service.
(4) "Experience study" means a report which furnishes
provides experience data and an actuarial analysis which
substantiate the actuarial assumptions on which valuations are
based.
(5) "Expected future statutory supplemental contributions"
means the sum of future employee and employer contributions at
the rates specified in statute when the valuation is completed,
reduced by the present value of future normal costs.
(6) "Current assets" means the value of all assets at cost,
which includes realized capital gains or losses, plus one-third
of any unrealized capital gains or losses.
(7) "Unfunded actuarial accrued liability" means total
current and expected future benefit obligations less the sum of
current assets and the present value of future normal costs.
Subd. 2. [REQUIREMENTS.] It is the policy of the
legislature that it is necessary and appropriate to determine
annually the financial status of tax supported retirement and
pension plans for public employees. In order To achieve this
goal, the legislative commission on pensions and retirement
shall have prepared annual actuarial valuations and periodic
experience studies of the public pension and retirement plans
enumerated in section 3.85, subdivision 12, clause (b), and the
governing or managing board or administrative officials of each
public pension and retirement fund or plan enumerated in section
356.20, subdivision 2, clauses (9), (10), and (12) shall cause
to be made have prepared annual actuarial valuations and
quadrennial periodic experience studies of their respective
funds as herein provided in this section. This requirement
shall also apply to any fund which may be a successor to any
organization enumerated in section 356.20, subdivision 2, or
to the governing or managing board or administrative officials
of any newly formed retirement fund or association operating
under the control or supervision of any public employee group,
governmental unit, or institution receiving a portion of its
support through legislative appropriations, and any local police
or fire fund coming within the provisions of section 356.216.
Subd. 3. [REPORTS.] The actuarial valuations required
annually shall be made as of the beginning of each fiscal year.
Two copies of each the valuation shall be delivered to the
executive director of the legislative commission on pensions and
retirement, to the commissioner of finance and to the
legislative reference library, not later than the first day of
the sixth month occurring after the end of the previous fiscal
year. Every fourth year occurring after 1975, Two copies of an
any experience study covering four fiscal years prepared
periodically as provided for in the standards adopted by the
commission shall be filed with the executive director of the
legislative commission on pensions and retirement, with the
commissioner of finance, and to with the legislative reference
library, not later than the first day of the sixth eleventh
month occurring after the end of the last fiscal year of the
period which the experience study covers. For actuarial
valuations and experience studies prepared at the direction of
the legislative commission on pensions and retirement, two
copies of the document shall be delivered to the governing or
managing board or administrative officials of the applicable
public pension and retirement fund or plan.
Subd. 4. [ACTUARIAL VALUATIONS; CONTENTS.] The actuarial
valuations valuation shall be made in conformity with the
requirements of the definition contained in subdivision 1 and
standards adopted by the legislative commission on pensions and
retirement. Each The actuarial valuation shall measure all
aspects of the benefit plan of the fund in accordance with
changes in benefit plans, if any, and salaries as will or can
reasonably be anticipated to be in force during the ensuing
fiscal year. Each The actuarial valuation shall be prepared in
accordance with the entry age normal actuarial cost (level
normal cost) method.
Each The actuarial valuation required under this section
shall include the information required in subdivisions 4a to 4k.
Subd. 4a. [NORMAL COST.] For each fund providing any
benefits under a defined benefit formula plan, the actuarial
valuation shall contain an exhibit indicating the level normal
cost of the benefits provided by the laws governing the fund as
of the date of the valuation must be, calculated in accordance
with the entry age normal actuarial cost (level normal cost)
method. The normal cost shall be expressed as a level
percentage of the future payroll of the active participants of
the fund as of the date of the valuation.
Subd. 4b. [ACCRUED LIABILITY.] For each fund providing any
benefits under a defined benefit plan, the actuarial valuation
shall contain an exhibit indicating the accrued liabilities of
the fund, which shall be equal to the present value of all
benefits minus the present value of future normal costs must be,
calculated in accordance with the entry age normal actuarial
cost method.
Subd. 4c. [DEFINED CONTRIBUTION ACCUMULATIONS.] For each
fund providing benefits under the money purchase or defined
contribution method plan, the actuarial valuation shall contain
an exhibit indicating the member contributions accumulated at
interest, as apportioned to members accounts, to the date of the
valuation must be calculated. These accumulations shall be
separately tabulated in such a manner as to reflect which
properly reflects any differences in money purchase or defined
contribution annuity rates which may apply.
Subd. 4d. [INTEREST AND SALARY ASSUMPTIONS.] For funds
governed by chapters 3A, 352, 352B, 352C, 353, 354 (except other
than the variable annuity fund, which is governed by section
354.62), and 490, the actuarial valuation shall use a
preretirement interest assumption of eight percent, a
postretirement interest assumption of five percent, and an
assumption that in each future year the salary on which a
retirement or other benefit is based is 1.065 multiplied by the
salary for the preceding year must be used. For funds governed
by chapter 354A, the actuarial valuation shall use preretirement
and postretirement assumptions of eight percent and an
assumption that in each future year the salary on which a
retirement or other benefit is based is 1.065 multiplied by the
salary for the preceding year, but the actuarial valuation shall
reflect the payment of postretirement adjustments to retirees
shall be based on the methods specified in the bylaws of the
fund as approved by the legislature. For all other funds, the
actuarial valuation shall use a preretirement interest
assumption of five percent, a postretirement interest assumption
of five percent, and an assumption that in each future year the
salary on which a retirement or other benefit is based is 1.035
multiplied by the salary for the preceding year must be used.
For funds governed by chapters 3A, 352C, and 490, the
actuarial valuation shall use a preretirement interest
assumption of eight percent, a postretirement interest
assumption of five percent, and an assumption that in each
future year in which the salary amount payable is not
determinable from section 3.099, 15A.081, subdivision 6, or
15A.083, subdivision 1, whichever is applicable, or from
applicable compensation council recommendations under section
15A.082, the salary on which a retirement or other benefit is
based is 1.065 multiplied by the known or computed salary for
the preceding year, whichever is applicable.
Subd. 4e. [OTHER ASSUMPTIONS.] Other The actuarial
valuation shall use assumptions as to concerning mortality,
disability, retirement, withdrawal, entry age and retirement age
, and any other relevant demographic or economic factor, which
shall be set at levels consistent with those determined in the
most recent experience study completed pursuant to subdivision
5, may be utilized. These other The actuarial valuation shall
contain an exhibit indicating any actuarial assumptions must be
set forth used in preparing the valuation report.
Subd. 4f. [ACTUARIAL BALANCE SHEET.] The actuarial
valuation shall contain an actuarial balance sheet must show,
which shall indicate current and expected future benefit
obligations, current and expected future assets, unfunded
actuarial accrued liability, current unfunded actuarial
liability, and current and future unfunded actuarial liability.
Specifically, the balance sheet for all funds, except local
police and, salaried firefighter, and specified volunteer
firefighter funds, shall be include organized in the following
manner:
Current assets
Cash and, cash equivalents,
and short-term securities $...
Fixed income investments ...
Equity investments ...
Real estate investments ...
Equity in the Minnesota postretirement
investment fund ...
Other ...
Total current assets $...
Expected future assets
Present value of expected future
statutory supplemental contributions ...
Present value of future normal costs ...
Total expected future assets $...
Total current and expected future assets $...
Current benefit obligations
Actuarial present value of credited
projected benefit obligations
on account of service rendered to date:
For annuitants
Retirement annuities $...
Disability annuities benefits ...
Surviving spouses' annuities
spouse and child benefits ...
Surviving children's annuities ...
For former members without
vested rights ...
For deferred annuitants' benefits,
including any augmentation ...
For active employees
Retirement benefits ...
Disability benefits ...
Refund liability due to
death or withdrawal ...
Survivors' benefits ...
Total current benefit obligations $...
Expected future benefit obligations
Actuarial value of benefit obligations
on account of future service for
active employees $...
Total current and expected future benefit
obligations $...
Current unfunded actuarial liability
(Total current benefit obligations less
total current assets): $...
Current and future unfunded actuarial
liability
(Total current and expected future benefit
obligations less total current and
expected future assets): $...
For the purpose of this subdivision, the terms
(a) "expected future statutory supplemental contributions"
means the sum of future employee and employer contributions at
the rates specified in statute at the time the valuation is
completed reduced by the present value of future normal costs;
and
(b) "current assets" means the value of all assets at cost,
which includes realized capital gains or losses, plus one-third
of any unrealized capital gains or losses.
(c) "unfunded accrued liability" means total current and
expected future benefit obligations less the sum of current
assets and the present value of future normal costs.
In addition to the above that itemization of benefit
obligations, separate items shall be shown for additional
benefits, if any, which may not be appropriately included in the
list shown above that itemization.
Subd. 4g. [AMORTIZATION CONTRIBUTIONS.] In addition to the
exhibit indicating the level normal cost, the actuarial
valuation shall contain an exhibit indicating the additional
annual contribution which would be required to retire amortize
the unfunded actuarial accrued liability must be calculated.
For funds governed by chapters 3A, 352, 352B, 352C, 353, 354,
354A, and 490, the additional contribution shall be calculated
on a level percent percentage of covered payroll basis by the
established date for full funding which is in effect at the time
of when the valuation is prepared. The level percent additional
contribution shall be calculated assuming annual payroll growth
of 6.5 percent. For all other funds, the additional annual
contribution shall be calculated on a level annual dollar amount
basis.
If, for any fund other than the Minneapolis employees
retirement fund, after the first actuarial valuation date
occurring after June 1, 1979, there has not been a change in any
or all of the actuarial assumptions used for calculating
the actuarial accrued liability of the fund, a change in the
benefit plan governing annuities and benefits payable from the
fund, a change in the actuarial cost method used in calculating
the actuarial accrued liability of all or a portion of the fund,
or a combination of the three, which change or changes by
themselves without inclusion of any other items of increase or
decrease produce a net increase in the unfunded actuarial
accrued liability of the fund, the established date for full
funding for the first actuarial valuation made after June 1,
1979 and each successive actuarial valuation shall be the first
actuarial valuation date which occurs after June 1, 2009.
If, for any fund or plan other than the Minneapolis
employees retirement fund, after the first actuarial valuation
date occurring after June 1, 1979, there has been a change in
any or all of the actuarial assumptions used for calculating the
actuarial accrued liability of the fund, a change in the benefit
plan governing annuities and benefits payable from the fund, a
change in the actuarial cost method used in calculating
the actuarial accrued liability of all or a portion of the fund,
or a combination of the three, which and the change or changes,
by themselves and without inclusion of any other items of
increase or decrease, produce a net increase in the unfunded
actuarial accrued liability in the fund, the established date
for full funding shall be determined using the following
procedure:
(i) the unfunded actuarial accrued liability of the fund
shall be determined in accordance with the plan provisions
governing annuities and retirement benefits and the actuarial
assumptions in effect prior to before an applicable change;
(ii) the level annual dollar contribution or level
percentage, whichever is applicable, which is needed to amortize
the unfunded actuarial accrued liability amount determined
pursuant to subclause (i) by the established date for full
funding in effect prior to the change shall be calculated using
the interest assumption specified in clause (4) in effect prior
to before the change;
(iii) the unfunded actuarial accrued liability of the fund
shall be determined in accordance with any new plan provisions
governing annuities and benefits payable from the fund and any
new actuarial assumptions and the remaining plan provisions
governing annuities and benefits payable from the fund and
actuarial assumptions in effect prior to before the change;
(iv) the level annual dollar contribution or level
percentage, whichever is applicable, which is needed to amortize
the difference between the unfunded actuarial accrued liability
amount calculated pursuant to subclause (i) and the unfunded
actuarial accrued liability amount calculated pursuant to
subclause (iii) over a period of 30 years from the end of the
plan year in which the applicable change is effective shall be
calculated using the applicable interest assumption specified in
clause (4) subdivision 4d in effect subsequent to after any
applicable change;
(v) the level annual dollar or level percentage
amortization contribution pursuant to subclause (iv) shall be
added to the level annual dollar amortization contribution or
level percentage calculated pursuant to subclause (ii);
(vi) the period in which the unfunded actuarial accrued
liability amount determined in subclause (iii) will be amortized
by the total level annual dollar or level percentage
amortization contribution computed pursuant to subclause (v)
shall be calculated using the interest assumption specified
in clause (4) subdivision 4d in effect subsequent to after any
applicable change, rounded to the nearest integral number of
years, but which shall not exceed a period of 30 years from the
end of the plan year in which the determination of the
established date for full funding using the procedure set forth
in this clause is made and which shall not be less than the
period of years beginning in the plan year in which the
determination of the established date for full funding using the
procedure set forth in this clause is made and ending by the
date for full funding in effect prior to before the change; and
(vii) the period determined pursuant to subclause (vi)
shall be added to the date as of which the actuarial valuation
was prepared and the date obtained shall be the new established
date for full funding.
For the Minneapolis employees retirement fund, the
established date for full funding shall be June 30, 2017.
Subd. 4h. [ACTUARIAL GAINS AND LOSSES.] The actuarial
valuation shall contain an exhibit consisting of an analysis by
the actuary explaining the net increase or decrease in the
unfunded actuarial accrued liability since the last valuation
must be provided. The explanation shall subdivide the net
increase or decrease in the unfunded actuarial accrued liability
into at least the following parts:
(a) increases or decreases in the unfunded actuarial
accrued liability because of changes in benefits;
(b) increases and decreases in the unfunded actuarial
accrued liability because of each change, if any, in actuarial
assumptions;
(c) increases or decreases in the unfunded actuarial
accrued liability separately by source attributable to actuarial
gains or losses resulting from any deviations of actual
investment earnings, actual postretirement mortality rates, and
actual salary increase rates, actual disability rates, actual
withdrawal rates and actual retirement rates from the
assumptions on which the valuations are based and the remainder
of the increase or decrease not attributable to any separate
source;
(d) increases or decreases in unfunded actuarial accrued
liability because of other reasons, including the effect of the
any amortization contribution required under clause (7); and
(e) increases or decreases in unfunded actuarial accrued
liability because of changes in eligibility requirements or
groups included in the membership of the fund.
Subd. 4i. [MEMBERSHIP TABULATION.] The actuarial valuation
shall contain an exhibit consisting of a tabulation of active
membership and annuitants in the fund must be provided. If the
membership of a fund is under more than one general benefit
program, a separate tabulation shall be made for each general
benefit program. The tabulations shall be submitted in contain
the following form information:
Annual
(a) Active members Number Payroll
As of last valuation date
new entrants
Total
Separations from active service
Refund of contributions
Separation with deferred annuity
Separation with neither refund
nor deferred annuity
Disability
Death
Retirement with service annuity
Total separations
As of current valuation date Annual
Annuity
(b) Annuitants Number Benefit
As of last valuation date
New entrants
Total
Terminations
Deaths
Other
Total terminations
As of current valuation date
The tabulation required under subclause (b) shall be made
separately for each of the following classes of annuitants:
(a) Service retirement annuitants
(b) Disabled annuitants Disability benefit recipients
(c) Surviving spouse annuitants benefit recipients
(d) Surviving children annuitants child benefit
recipients
(e) Deferred annuitants
Subd. 4j. [ADMINISTRATIVE EXPENSES.] The actuarial
valuation shall contain an exhibit indicating a statement of the
administrative expenses must be provided expressed both in
dollars and also as a percentage of covered payroll.
Subd. 4k. [PLAN SUMMARY.] The actuarial valuation shall
contain an exhibit indicating a summary of the principal
provisions of the plan upon which the valuation is based must be
included.
Subd. 5. [EXPERIENCE STUDY; CONTENTS.] Each experience
study shall contain an actuarial analysis which substantiates of
the experience of the fund or association and a comparison of
the experience with the actuarial assumptions on which the most
recent actuarial valuation of the retirement fund or relief
association was based, and shall also contain:
(1) A statement of the average entry ages at which
employment commences;
(a) For all those currently active members at the date of
the experience study.
(b) Separately as to new entrants for each of the last five
fiscal years.
(2) a statement of the average ages at which service
retirements have taken place;
(a) For all service retirement annuitants living at the
date of the experience study.
(b) Separately as to new retirements for each of the last
five fiscal years.
Subd. 6. [APPROVED ACTUARIES.] Each actuarial valuation or
experience study shall be made and any actuarial consulting
services for a retirement fund or plan shall be provided by an
approved actuary. An approved actuary is an actuary who has not
less than 15 years of service to major public employee pension
or retirement funds, or who is a fellow in the society of
actuaries, or any firm retaining such an actuary on its staff.
Each The actuarial valuation or experience study shall state
include a certification that it has been completed prepared in
accordance with the provisions of sections 356.20 to 356.23 and
the standards for actuarial work adopted by the legislative
commission on pensions and retirement.
Subd. 7. [ESTABLISHMENT OF ACTUARIAL ASSUMPTIONS.]
Actuarial assumptions used for actuarial valuations under this
section that are other than those set forth in this section may
be changed only with the approval of the legislative commission
on pensions and retirement. A change in the applicable
actuarial assumptions may be proposed by the governing board of
the applicable pension fund or relief association, by the
actuary retained by the legislative commission on pensions and
retirement, by the actuarial advisor retained by a pension fund
governed by chapter 352, 353, 354, or 354A, or by the actuary
retained by a local police or firefighters relief association
governed by sections 69.77 or 69.771 to 69.776.
Sec. 56. Minnesota Statutes 1986, section 356.216, is
amended to read:
356.216 [CONTENTS OF ACTUARIAL VALUATIONS FOR LOCAL POLICE
AND FIRE FUNDS.]
The provisions of section 356.215 governing the contents of
actuarial valuations shall apply to any local police or fire
pension fund or relief association required to make an actuarial
report under this section except as follows:
(1) in calculating normal cost and other requirements, if
required to be expressed as a level percentage of covered
payroll, the salaries used in computing covered payroll shall be
the maximum rate of salary from which retirement and
survivorship credits and amounts of benefits are determined and
from which any member contributions are calculated and deducted;
(2) in lieu of the amortization date specified in section
356.215, subdivision 4g, the appropriate amortization target
date specified in section 69.77, subdivision 2b, or 69.773,
subdivision 4, clause (b), shall be used in calculating the any
required amortization contribution;
(3) in addition to the tabulation of active members and
annuitants provided for in section 356.215, subdivision 4i, the
member contributions for active members for the calendar year
and the prospective annual retirement annuities under the
benefit plan for active members shall be reported;
(4) actuarial valuations required pursuant to section
69.773, subdivision 2 shall be made at least every four years
and actuarial valuations required pursuant to section 69.77
shall be made annually; and
(5) the actuarial balance sheet showing accrued
assets valued at market value if the actuarial valuation is
required to be prepared at least every four years or valued as
current assets under section 356.215, subdivision 1, clause (5),
if the actuarial valuation is required to be prepared annually,
actuarial accrued liabilities, and the deficit from full funding
of liabilities (unfunded actuarial accrued liability) shall
include the following required reserves:
(a) For active members
1. Retirement benefits
2. Disability benefits
3. Refund liability due to death or withdrawal
4. Survivors' benefits
(b) For deferred annuitants' benefits
(c) For former members without vested rights
(d) For annuitants
1. Retirement annuities
2. Disability annuities
3. Surviving spouses' annuities
4. Surviving children's annuities
(6) actuarial valuations shall be due not later than the
first day of the seventh month after the end of the fiscal year
which the valuation covers.
In addition to the above those required reserves, separate
items shall be shown for additional benefits, if any, which may
not be appropriately included in the reserves listed above.
(6) actuarial valuations shall be due by the first day of
the seventh month after the end of the fiscal year which the
actuarial valuation covers.
Sec. 57. Minnesota Statutes 1986, section 356.22,
subdivision 2, is amended to read:
Subd. 2. [ACCELERATED AMORTIZATION.] No provision in
sections 356.20 to 356.23 shall be construed to preclude any
public pension and retirement fund herein enumerated in section
356.20, subdivision 2 from requesting, or the legislature from
providing for, the amortization of any deficit unfunded
actuarial accrued liability in a shorter period of time than by
the established date for full funding as determined pursuant to
section 356.215, subdivision 4g.
Sec. 58. Minnesota Statutes 1986, section 356.23, is
amended to read:
356.23 [SUPPLEMENTAL VALUATIONS; ALTERNATIVE REPORTS AND
VALUATIONS.]
Subdivision 1. [SUPPLEMENTAL ACTUARIAL VALUATIONS.] Any
supplemental actuarial valuations prepared on behalf of any
governing or managing board of any pension and retirement fund
enumerated in section 356.20, subdivision 2, by an approved
actuary, shall be prepared in accordance with the applicable
provisions of sections 356.20 to 356.23 and the standards
adopted by the legislative commission on pensions and
retirement. Any pension and retirement fund which prepares an
alternative actuarial valuation under subdivision 2 shall also
have a supplemental actuarial valuation prepared.
Subd. 2. [ALTERNATIVE REPORTS AND VALUATIONS.] In addition
to the financial reports and actuarial valuations required by
sections 356.20 to 356.23, the governing or managing board
of the funds any fund concerned may submit alternative reports
and valuations for distribution to the legislature or, any of
its commissions or committees, or the legislative commission on
pensions and retirement on a different basis or on different
assumptions than are specified in sections 356.20 to 356.23;
provided. The assumptions and basis of such any alternative
reports and valuations are shall be clearly set forth therein
stated in the document.
Sec. 59. Minnesota Statutes 1986, section 356.41, is
amended to read:
356.41 [BENEFIT ADJUSTMENTS FOR CERTAIN DISABILITY AND
SURVIVOR BENEFITS.]
Disability benefits and survivor benefits payable to a
disabilitant or, if not otherwise included in the participation
in the Minnesota postretirement investment fund, and survivor
benefits payable to a survivor now or hereafter receiving
benefits from any public pension fund which participates in the
Minnesota postretirement investment fund shall be adjusted in
the same manner, at the same times and in the same amounts as
are benefits payable from the Minnesota postretirement
investment fund to retirees eligible benefit recipients of that
public pension fund. If a disability benefit is not included in
the participation in the Minnesota postretirement investment
fund, the disability benefit is recomputed as a retirement
annuity and the recipient would have been eligible for an
adjustment pursuant to this section if the disability benefit
was not recomputed, the recipient will continue to be eligible
for the adjustment pursuant to this section after the
recomputation. For the survivor of a deceased annuitant who
receives a survivor benefit calculated pursuant to a prior law
rather than the second portion of a joint and survivor annuity,
any period of receipt of a retirement annuity by the annuitant
shall be utilized in determining the period of receipt for
eligibility to receive an adjustment pursuant to this section.
No recipient shall, however, be entitled to more than one
adjustment pursuant to this section or section 11A.18 applicable
to one benefit at one time by reason of this section.
Sec. 60. Minnesota Statutes 1986, section 356.451,
subdivision 1, is amended to read:
Subdivision 1. [RESERVE ACCOUNT FOR PROVISIONAL MEMBERS;
AUTHORIZATION.] Notwithstanding any provisions to the contrary
of the laws governing the funds enumerated in subdivision 2, any
person who is employed in subsidized on-the-job training, work
experience or public service employment as an enrollee under the
federal Comprehensive Employment and Training Act, who does not
have as of the later of March 30, 1978 or the date of employment
sufficient service credit in the retirement fund to meet the
minimum vesting requirements for a deferred annuity, who
otherwise meets all of the applicable eligibility requirements
of the fund and who is designated as such by the city council of
the city of Minneapolis or the board of education of special
school district No. 1, whichever is applicable, shall be
considered a provisional member of the fund. There shall be
established a subsidiary reserve account for provisional members
which shall be managed by the board of trustees of the fund as a
separate account and which shall not be considered as an asset
or a liability of the fund. To this account shall be credited
all employee and required employer contributions made by or on
account of provisional members. A separate record for each
provisional member shall be maintained showing the length of
service completed, the accrued employee and required employer
contributions made by or on account of each provisional member,
and the actual rate of interest earned on the assets of the
account. The assets of the separate account shall be invested
in the same manner as and subject to the same limitations which
as are applicable to the general assets of the retirement fund.
The board of trustees shall remit back to the prime sponsor of
the federal Comprehensive Employment and Training Act program
periodically as required by the applicable federal regulation an
amount equal to the total required employer contributions made
on account of provisional members who terminate or who are
terminated from subsidized on-the-job training, work experience
or public service employment without obtaining unsubsidized
employment with an employer who employs members who regularly
have retirement coverage provided by that retirement fund or by
a retirement fund enumerated in section 356.30, subdivision 3,
or without obtaining sufficient service credit to become
entitled to a deferred retirement annuity had they been regular
members of that retirement fund during the period of their
provisional membership, plus interest at the rate or rates
actually earned and in addition any amounts which exceed the
funds required to cover current provisional members as projected
by the board of trustees. Any provisional member who terminates
or is terminated from subsidized on-the-job training, work
experience or public service employment without obtaining
unsubsidized employment with an employer who employs members who
regularly have retirement coverage provided by that retirement
fund or by a retirement fund enumerated in section 356.30,
subdivision 3, or without obtaining sufficient service to become
entitled to a deferred retirement annuity had the provisional
member been a regular member of the retirement fund during the
period of provisional membership shall be entitled upon making
valid written application to a refund of all employee
contributions credited to the member in the subsidiary reserve
account for provisional members, plus interest at the average
actual rate of interest earned on the assets of the account, but
not to exceed the rate of 3-1/2 percent per annum compounded
annually from the date of commencement of provisional
membership, computed to the first day of the month in which the
refund is processed, and based on fiscal year balances. If the
provisional member obtains unsubsidized employment with an
employer who employs members who regularly have retirement
coverage provided by that retirement fund or by a retirement
fund enumerated in section 356.30, subdivision 3, or obtains
sufficient service to become entitled to a deferred retirement
annuity had the period of provisional membership been as a
regular member, the board of trustees shall transfer the total
employee and required employer contributions and any interest
attributable to those contributions to the regular retirement
fund and shall credit the period of service as a provisional
member as allowable or formula service. Unless the provisional
member becomes a regular member of the same that retirement fund
or a retirement fund enumerated in section 356.30, subdivision
3, within the time period allowed under the applicable federal
regulations following the person's termination of provisional
status, no period of provisional membership shall be considered
allowable service for purposes of the combined service annuity
pursuant to section 356.30 or any service in more than one
retirement fund provision. For any former provisional member
who becomes a regular member of a retirement fund enumerated in
section 356.30, subdivision 3, the board of trustees shall
require written certification of the fact of unsubsidized
employment from the subsequent employer and of the fact of
regular fund membership from the subsequent retirement fund. If
any provisional member obtains service in an amount sufficient
to entitle the provisional member to a disability benefit or the
provisional member's survivor to a survivor's benefit had the
provisional member been a regular member for that period of
service, then the provisional member or the provisional member's
survivor shall be entitled to a benefit when otherwise qualified
notwithstanding the fact that the person was a provisional
member. Upon the commencement of such the benefit, an amount
equal to the contributions and interest credited to the
provisional member shall be transferred from the reserve account
for provisional members to the regular fund. In any actuarial
valuation made by the fund pursuant to this chapter, the results
of the subsidiary reserve account for provisional members shall
be contained in a separate calculation or tabulation. The
separate calculation or tabulation shall use the actuarial
assumptions used by the fund which are appropriate to the
experience of the subsidiary reserve account for provisional
members, and shall include the items contained in section
356.215, subdivisions 4, 4a, 4b, 4f, and 4k.
Sec. 61. Minnesota Statutes 1986, section 422A.01,
subdivision 6, is amended to read:
Subd. 6. [PRESENT VALUE.] "Present worth" or "present
value" means that the present amount of money if increased at an
assumed rate of the applicable postretirement or preretirement
interest rate assumption specified in section 356.215,
subdivision 4d and based on the mortality table adopted by the
board of trustees based on the experience of the fund as
recommended by the actuary retained by the legislative
commission on pensions and retirement will at the time of
retirement equal the cost actuarial accrued liability of the
annuity already earned.
Sec. 62. Minnesota Statutes 1986, section 422A.01,
subdivision 7, is amended to read:
Subd. 7. [ACTUARIAL EQUIVALENT.] "Actuarial equivalent"
means two or more settlements, annuities, or benefits that have
the same condition of one annuity or benefit having an equal
present worth or present value as another annuity or benefit.
Sec. 63. Minnesota Statutes 1986, section 422A.01,
subdivision 10, is amended to read:
Subd. 10. [UNFUNDED ACTUARIAL ACCRUED LIABILITY.]
"Actuarial deficit" or "actuarial surplus" of an allowance or of
allowances "Unfunded actuarial accrued liability" means the
difference between the actuarial accrued liabilities liability
to date of the allowance or allowances and the corresponding
assets valued under section 356.215, subdivision 1, clause (6).
Sec. 64. Minnesota Statutes 1986, section 422A.04,
subdivision 2, is amended to read:
Subd. 2. [ACTUARIAL DATA.] The board shall keep in
convenient form such any data as shall be necessary for the
preparation of the annual actuarial valuation of the various
funds and accounts fund created by sections 422A.01 to 422A.25
this chapter. The board actuarial valuations of the fund shall
be governed by the provisions of chapter 356.
Sec. 65. Minnesota Statutes 1986, section 422A.04,
subdivision 3, is amended to read:
Subd. 3. [EXPERIENCE DATA AND MORTALITY TABLES.] The board
shall prepare and keep all any needful tables, records and
accounts required for carrying out the provisions of sections
422A.01 to 422A.25, including data showing the mortality and
disability experience of the officers and employees of the
service and the date of withdrawal from such service, and any
other information that may serve as a guide for future actuarial
valuations and adjustments of in the plan actuarial assumptions
for the retirement of officers and employees fund. Mortality
tables shall be adopted and may be modified from time to time by
the board based on the experience of the fund as recommended by
the actuary retained by the legislative commission on pensions
and retirement as a basis of calculation for retirement
allowances, which tables may be modified from time to time with
any recommendation by the actuary retained as a part of the
permanent records of the board.
Sec. 66. Minnesota Statutes 1986, section 422A.06,
subdivision 2, is amended to read:
Subd. 2. [ACTUARIAL VALUATIONS REQUIRED.] At the end As of
July 1 of each class year, an actuarial valuation of the
retirement fund shall be prepared by the commission-retained
actuary and filed in conformance with the provisions and
requirements of sections 356.215 to 356.23. Experience studies
shall be prepared at such those times as required by statute,
required by the standards for actuarial work adopted by the
legislative commission on pensions and retirement or ordered by
the board.
The board may contract for the services of an approved
actuary and fix the reasonable compensation for those services.
Any approved actuary retained by the board shall function as the
actuarial advisor to the board and may perform actuarial
valuations and experience studies to supplement those performed
by the actuary retained by the legislative commission on
pensions and retirement. Any supplemental actuarial valuations
or experience studies shall be filed with the executive director
of the legislative commission on pensions and retirement.
Sec. 67. Minnesota Statutes 1986, section 422A.06,
subdivision 5, is amended to read:
Subd. 5. [TRANSFER OF RESERVES TO RETIREMENT BENEFIT FUND;
ADJUSTMENTS OF ANNUITIES AND BENEFITS.] (a) For those members
retiring pursuant to this chapter, Assets equal to the required
reserves for retirement annuities as determined in accordance
with a the appropriate mortality table appropriate to the
retirement fund with an adopted by the board of trustees based
on the experience of the fund as recommended by the
commission-retained actuary and using the postretirement
interest assumption set at the rate specified in section
356.215, subdivision 4d, shall be transferred to the disability
benefit fund as provided in subdivision 7, or the retirement
benefit fund, except for any amounts payable from the survivor
benefit fund, as of date of retirement.
(b) Annuity payments shall be adjusted in accordance with
the provisions of this chapter, except that no minimum
retirement payments therein described in this chapter shall
include any amounts payable from the survivors' benefit fund or
disability benefit fund and supplemented benefits specifically
financed by statute.
(c) Notwithstanding the provisions of section 356.18,
increases in annuity payments pursuant to this section shall be
made automatically unless written notice on a form prescribed by
the board is filed with the retirement board requesting that the
increase not be made.
(d) Any additional annuity which began to accrue on July 1,
1973 or which began to accrue on January 1, 1974, pursuant to
Laws 1973, chapter 770, section 1, shall be considered as part
of the base amount to be used in determining any postretirement
adjustments payable pursuant to the provisions of subdivision 8.
Sec. 68. Minnesota Statutes 1986, section 422A.06,
subdivision 7, is amended to read:
Subd. 7. [DISABILITY BENEFIT FUND.] (a) The disability
benefit fund shall consist of amounts held for payment of
disability allowances which become effective after December 31,
1973. required reserves for all disability allowances which
become effective after such date assets equal to the present
value of such allowances December 31, 1973, shall be transferred
from the deposit accumulation fund to the disability benefit
fund. A proportionate share of income from investments shall be
allocated to this fund. There shall be paid from this fund the
disability allowances which become effective after December 31,
1973.
(b) In the event of termination of any such disability
allowance for any reason other than the death of the recipient,
the present value of such balance of the required reserves for
the disability allowance as of the date of termination shall be
transferred from the disability benefit fund to the deposit
accumulation fund.
(c) At the end of each fiscal year an, as part of the
annual actuarial valuation, a determination shall be made of the
required reserves for all disability allowances being paid from
the disability benefit fund. Any excess of assets over
actuarial required reserves in the disability benefit fund shall
be transferred to the deposit accumulation fund. Any excess of
actuarial reserves over assets in the disability benefit fund
shall be funded by a transfer of such excess the appropriate
amount of assets from the deposit accumulation fund.
Sec. 69. Minnesota Statutes 1986, section 422A.06,
subdivision 8, is amended to read:
Subd. 8. [RETIREMENT BENEFIT FUND.] The retirement benefit
fund shall consist of amounts held for payment of retirement
allowances for members retired pursuant to sections 422A.01 to
422A.25. For members retiring after the established date for
the transfer of assets and liabilities specified in section
422A.06, subdivision 3, this chapter. Assets equal to the
required reserves for retirement allowances pursuant to law this
chapter determined in accordance with the appropriate mortality
table adopted by the board of trustees based on the experience
of the fund as recommended by the commission-retained actuary
shall be transferred from the deposit accumulation fund to the
retirement benefit fund as of the last business day of the month
in which the retirement allowance begins. All The income from
investments of these assets shall be allocated to this fund.
There shall be paid from this fund all the retirement annuities
authorized by law. A required reserve calculation for the
retirement benefit fund must be made by the actuary retained by
the legislative commission on pensions and retirement and must
be certified to the retirement board by the commission-retained
actuary. The retirement benefit fund shall be governed by the
applicable laws governing the accounting and audit procedures,
investment, actuarial requirements, calculation and payment of
postretirement benefit adjustments, discharge of any deficiency
in the assets of the fund when compared to the actuarially
determined required reserves, and other applicable operations
and procedures regarding the Minnesota postretirement investment
fund established pursuant to section 11A.18, and any legal or
administrative interpretations of those laws of the state board
of investment, the legal advisor to the board of investment and
the executive director of the state board of investment. If a
deferred yield adjustment account is established for the
Minnesota postretirement investment fund under section 11A.18,
subdivision 5, the retirement board shall also establish and
maintain a deferred yield adjustment account within this fund.
Annually, following the calculation of any postretirement
adjustment payable from the retirement benefit fund, the board
of trustees shall submit a report to the executive director of
the legislative commission on pensions and retirement and to the
commissioner of finance indicating the amount of any
postretirement adjustment and the underlying calculations on
which that postretirement adjustment amount is based, including
the amount of dividends, the amount of interest, and the amount
of net realized capital gains or losses utilized in the
calculations.
Sec. 70. Minnesota Statutes 1986, section 422A.101, is
amended to read:
422A.101 [PREPARATION OF FINANCIAL REQUIREMENTS OF FUND;
EMPLOYER CONTRIBUTIONS.]
Subdivision 1. [FINANCIAL REQUIREMENTS OF FUND.] Prior to
August 31 annually, the retirement board, in consultation with
the commission-retained actuary, shall prepare an itemized
statement of the financial requirements of the fund for the
succeeding fiscal year. A copy of the statement shall be
submitted to the city council, the board of estimate and
taxation of the city, the managing board or chief administrative
officer of each city owned public utility, improvement project
or municipal activity supported in whole or in part by revenues
other than real estate taxes, public corporation, or unit of
metropolitan government employing members of the fund, the board
of special school district No. 1, and the state commissioner of
finance prior to September 15 annually. The statement shall be
itemized and shall include the following:
(1) an estimate of the administrative expenses of the fund
for the following year, less any amount which the retirement
board may charge against the interest income account of the fund
as the cost of handling the investment securities of the
fund which shall be determined by multiplying the figure for
administrative expenses as reported in the most recent actuarial
valuation prepared by the commission-retained actuary by the
factor of 1.035;
(2) an estimate of the normal cost of the fund expressed as
a dollar amount, which shall be determined by applying the
normal cost of the fund as reported in the most recent actuarial
valuation prepared by the commission-retained actuary and
expressed as a percentage of covered payroll to the estimated
total covered payroll of all employees covered by the fund for
the following year;
(3) an estimate of the contribution required to amortize on
a level annual dollar basis the unfunded actuarial accrued
liability of the fund by the year June 30, 2017, using an
interest rate of five percent compounded annually as reported in
the most recent actuarial valuation, prepared by the
commission-retained actuary expressed as a dollar amount. In
determining the amount of the unfunded actuarial accrued
liability of the fund, all assets other than the assets of the
retirement benefit fund shall be valued as current assets as
defined under section 356.215, subdivision 1, clause (5), and
the assets of the retirement benefit fund shall be valued equal
to the actuarially determined required reserves for benefits
payable from that fund;
(4) the amount of any deficiency in the actual amount of
any employer contribution provided for in this section when
compared to the required contribution amount certified for the
previous year, plus interest on the amount at the rate of six
percent per annum.
Subd. 1a. [CITY CONTRIBUTIONS.] Prior to August 31 of each
year, the retirement board shall prepare an itemized statement
of the financial requirements of the fund payable by the city
for the succeeding fiscal year, and a copy of the statement
shall be submitted to the board of estimate and taxation and to
the city council by September 15. The financial requirements of
the fund payable by the city shall be calculated as follows:
(a) a regular employer contribution of an amount equal to
the percentage rounded to the nearest two decimal places of the
salaries and wages of all employees covered by the retirement
fund which equals the difference between the level normal cost
plus administrative cost as reported in the annual actuarial
valuation prepared by the commission-retained actuary and the
employee contributions provided for in section 422A.10 less any
amounts contributed toward the payment of the balance of the
normal cost not paid by employee contributions by any city owned
public utility, improvement project, other municipal activities
supported in whole or in part by revenues other than real estate
taxes, any public corporation, any employing unit of
metropolitan government, or by special school district number 1
pursuant to subdivision 2;
(b) an additional employer contribution of an amount equal
to the percent specified in section 353.27, subdivision 3a,
clause (a), multiplied by the salaries and wages of all
employees covered by the retirement fund less any amounts
contributed toward amortization of the unfunded actuarial
accrued liability by the year June 30, 2017, attributable to
their respective covered employees by any city owned public
utility, improvement project, other municipal activities
supported in whole or in part by revenues other than real estate
taxes, any public corporation, any employing unit of
metropolitan government, or by Special School District No. 1
pursuant to subdivision 2; and
(c) a proportional share of an additional employer
amortization contribution of an amount equal to $3,900,000
annually until the year June 30, 2017, based upon the share of
the fund's unfunded actuarial accrued liability attributed to
the city as disclosed in the annual actuarial valuation prepared
by the commission-retained actuary.
The city council shall, in addition to all other taxes
levied by the city, annually levy a tax equal to the amount of
the financial requirements of the fund which are payable by the
city. The tax, when levied, shall be extended upon the county
lists and shall be collected and enforced in the same manner as
other taxes levied by the city. If the city does not levy a tax
sufficient to meet the requirements of this subdivision, the
retirement board shall submit the tax levy statement directly to
the county auditor, who shall levy the tax. The tax, when
levied, shall be extended upon the county lists and shall be
collected and paid into the city treasury to the credit of the
retirement fund. Any amount to the credit of the retirement
fund shall constitute a special fund and shall be used only for
the payment of obligations authorized pursuant to this chapter.
Subd. 2. [CONTRIBUTIONS BY OR FOR CITY-OWNED PUBLIC
UTILITIES, IMPROVEMENTS, OR MUNICIPAL ACTIVITIES.] Contributions
by or for any city-owned public utility, improvement project and
other municipal activities supported in whole or in part by
revenues other than real estate taxes, any public corporation,
any employing unit of metropolitan government, special school
district No. 1 or Hennepin county, on account of any employee
covered by the fund shall be calculated as follows:
(a) a regular employer contribution of an amount equal to
the percentage rounded to the nearest two decimal places of the
salaries and wages of all employees of the employing unit
covered by the retirement fund which equals the difference
between the level normal cost plus administrative cost reported
in the annual actuarial valuation prepared by the
commission-retained actuary and the employee contributions
provided for in section 422A.10;
(b) an additional employer contribution of an amount equal
to the percent specified in section 353.27, subdivision 3a,
clause (a), multiplied by the salaries and wages of all
employees of the employing unit covered by the retirement fund;
(c) a proportional share of an additional employer
amortization contribution of an amount equal to $3,900,000
annually until the year June 30, 2017, based upon the share of
the fund's unfunded actuarial accrued liability attributed to
the employer as disclosed in the annual actuarial
valuation prepared by the commission-retained actuary.
The city council or any board or commission may, by proper
action, provide for the inclusion of the cost of the retirement
contributions for employees of any city-owned public utility or
for persons employed in any improvement project or other
municipal activity supported in whole or in part by revenues
other than taxes who are covered by the retirement fund in the
cost of operating the utility, improvement project or municipal
activity. The cost of retirement contributions for these
employees shall be determined by the retirement board and the
respective governing bodies having jurisdiction over the
financing of these operating costs.
The cost of the employer contributions on behalf of
employees of special school district No. 1 who are covered by
the retirement fund shall be the obligation of the school
district. The retirement board shall prepare an itemized
statement of the financial requirements of the fund payable by
the school district, which shall be submitted prior to September
15. Contributions by the school district shall be made at times
designated by the retirement board. The school district may
levy for its contribution to the retirement fund only to the
extent permitted pursuant to section 275.125, subdivision 6a.
The cost of the employer contributions on behalf of
elective officers or other employees of Hennepin county who are
covered by the retirement fund pursuant to section 422A.09,
subdivision 3, clause (2), 422A.22, subdivision 2, or 488A.115,
or Laws 1973, chapter 380, section 3, Laws 1975, chapter 402,
section 2, or any other applicable law shall be the obligation
of Hennepin county. The retirement board shall prepare an
itemized statement of the financial requirements of the fund
payable by Hennepin county, which shall be submitted prior to
September 15. Contributions by Hennepin county shall be made at
times designated by the retirement board. Hennepin county may
levy for its contribution to the retirement fund.
Subd. 2a. [CONTRIBUTIONS BY METROPOLITAN AIRPORT
COMMISSION AND METROPOLITAN WASTE CONTROL COMMISSION.] The
metropolitan airport commission and the waste control commission
shall pay to the Minneapolis employees retirement fund annually
in installments as specified in subdivision 3 the share of the
additional support rate required for full amortization of the
unfunded actuarial accrued liabilities by the year June 30,
2017, that is attributable to airport commission or waste
control commission employees who are members of the fund. The
amount of the payment is shall be determined by utilizing the
most recent actuarial valuation, as calculated prepared by the
actuary for retained by the legislative commission on pensions
and retirement.
Subd. 3. [STATE CONTRIBUTIONS.] The state shall pay to the
Minneapolis employees retirement fund annually an amount equal
to the financial requirements of the Minneapolis employees
retirement fund reported by the actuary in the actuarial
valuation of the fund prepared by the commission-retained
actuary pursuant to section 356.215 for the most recent year but
based on a target date for full amortization of the
unfunded actuarial accrued liabilities by the year June 30,
2017, less the amount of employee contributions required
pursuant to section 422A.10, and the amount of employer
contributions required pursuant to subdivisions 1a, 2, and 2a.
Payments shall be made in four equal installments, occurring on
March 15, July 15, September 15, and November 15 annually.
Sec. 71. Minnesota Statutes 1986, section 422A.15,
subdivision 2, is amended to read:
Subd. 2. [WITHDRAWAL OF VOLUNTARY CONTRIBUTIONS.]
Voluntary additions to the employee's deposits made by the
employee under the provisions of section 422A.10 may be
withdrawn by the retiring employee or, with the approval of the
retirement board, applied to the purchase of an additional
annuity computed and determined under a procedure specified by
the actuary in accordance with retained by the legislative
commission on pensions and retirement utilizing the same
assumptions used by the fund appropriate mortality table
established by the board of trustees based on the experience of
the fund as recommended by the commission-retained actuary and
using the applicable postretirement interest rate assumption
specified in section 356.215, subdivision 4d.
Sec. 72. Minnesota Statutes 1986, section 422A.15,
subdivision 3, is amended to read:
Subd. 3. [OPTIONAL DEFINED CONTRIBUTION ANNUITY.] In lieu
of the formula pension and annuity, each a person who was a
contributing member on the effective date of this act April 28,
1973, who is eligible to retire and who ceases to be employed
and who qualifies for retirement shall have the option of
electing to receive what shall be a retirement allowance known
as "the $2 bill and annuity".
If a member of the contributing class makes the election
herein provided for in this section, the member shall receive a
minimum pension of $2 per month for each year of service. The
pension shall be the actuarial equivalent of the accumulated
amounts of such the annual installments as may be now or
hereafter fixed and designated by law throughout the period of
service of the retiring employee, not to exceed 25 years,
accumulated to the date of retirement at six percent compound
interest, and such extra credit to be furnished provided by the
city as will produce such the minimum pension of $2 per month
for each year of service. The pension shall be in addition to
the annuity. The annuity shall be in the actuarial equivalent
of the net accumulated contributions for to the credit of the
retiring employee, calculated at the date of retirement. For
the purposes of sections 422A.01 to 422A.25 this chapter, the
"service allowance" for members of the contributing class shall
consist of an "annuity" and a "pension".
The pension provided for herein shall be the actuarial
equivalent of the accumulated annual installments of $2 per
month for each year of service. The sum of $2 shall be computed
under the as a single life plan annuity, and subject to
the same option selections provided for in section 422A.17. The
pension and annuity provided for herein in this subdivision
shall be first paid from the contributing member's own
contributions and normal earned credits, plus interest,
until such those credits are exhausted.
The retirement allowance provided under this subdivision or
any optional annuity form of the retirement allowance shall be
computed and determined under a procedure specified by the
commission-retained actuary utilizing the appropriate mortality
table established by the board of trustees based on the
experience of the fund as recommended by the actuary retained by
the legislative commission on pensions and retirement and using
the applicable postretirement interest rate assumption specified
in section 356.215, subdivision 4d.
Sec. 73. Minnesota Statutes 1986, section 422A.16,
subdivision 2, is amended to read:
Subd. 2. [DEFERRED DEFINED CONTRIBUTION ANNUITY.] A person
who is a member of the contributing class on the effective date
of this act April 28, 1973, and who makes the election herein
provided for in this subdivision and in subdivision 1 provided
for, may, upon attaining the age of 55 years, but before
attaining the age of 65 years, or someone acting in the member's
behalf, may make application to receive such the retirement
allowance as is provided for in section 422A.15, subdivision
3, or an optional retirement allowance in the manner provided
for by section 422A.17. Such The retirement allowance shall be
the actuarial equivalent of the city's contribution and the
member's deposit, as they were on the date the separation
becomes permanent, plus interest, as provided for in section
422A.12.
The retirement allowance provided under this subdivision or
any optional annuity form of the retirement allowance shall be
computed and determined under a procedure specified by the
commission-retained actuary utilizing the appropriate mortality
table established by the board of trustees based on the
experience of the fund as recommended by the commission-retained
actuary and using the applicable postretirement interest rate
assumption specified in section 356.215, subdivision 4d.
Sec. 74. Minnesota Statutes 1986, section 422A.16,
subdivision 3a, is amended to read:
Subd. 3a. [DEATH WHILE DEFERRED SURVIVOR BENEFIT.] If a
contributing member person who has become permanently separated
from the service of the city after 20 or more years of service
as a contributing member, has at the time of separation allowed
the member's contributions to the fund to remain on deposit, and
has filed a written request with the board on prescribed forms,
dies prior to before the effective date of retirement as
determined by the board, the board shall pay a monthly allowance
for life to the surviving spouse of the employee, in lieu of the
city credit referred to in section 422A.23. The monthly
allowance herein provided for in this subdivision shall be the
actuarial equivalent of a single life service allowance
specified in section 422A.15, subdivision 1, which would have
been payable to the employee person on the date of death,
notwithstanding the age requirement stated therein in section
422A.15, subdivision 1. For purposes of this subdivision, the
amount of any excess contributions or voluntary additions by the
member person shall not be included in determining the monthly
allowance.
The surviving spouse allowance under this subdivision shall
be computed and determined under a procedure specified by the
commission-retained actuary utilizing the appropriate mortality
table established by the board of trustees based on the
experience of the fund as recommended by the commission-retained
actuary and using the applicable postretirement interest rate
assumption specified in section 356.215, subdivision 4d.
Sec. 75. Minnesota Statutes 1986, section 422A.16,
subdivision 10, is amended to read:
Subd. 10. [DEFERRED ALLOWANCE AUGMENTATION.] All Deferred
allowances granted under this section shall be calculated as of
the date of separation and shall be increased by the
interest assumption rate provided for in chapter 356 of five
percent per year until January 1, 1981, and thereafter by the
interest rate of three percent per year, compounded annually.
Sec. 76. Minnesota Statutes 1986, section 422A.17, is
amended to read:
422A.17 [RETIREMENT ALLOWANCE; OPTIONS.]
At the time of retirement, any employee who is eligible to
receive a service allowance may elect to receive benefits in a
retirement allowance payable throughout life or may on
retirement elect to receive the actuarial equivalent at that
time of annuity, pension, or retirement allowance in a lesser
annuity, or a lesser pension, or a lesser retirement allowance,
payable throughout life, with the provisions that:
Option I. If the beneficiary benefit recipient dies before
receiving in payments an amount equal to the present value of
the beneficiary's benefit recipient's annuity, pension, or
retirement allowance, as it was at of the time date of the
beneficiary's benefit recipient's retirement, the balance shall
be paid to the beneficiary's benefit recipient's legal
representatives or to such person, having an insurable interest
in the beneficiary's benefit recipient's life, as the
beneficiary benefit recipient shall nominate by written
designation duly acknowledged and filed with the retirement
board at the time as of the date of retirement, or
Option II. Upon the death of the beneficiary benefit
recipient, the beneficiary's benefit recipient's annuity,
pension, or retirement allowance shall be continued throughout
the life of and paid to such the person, having an insurable
interest in the beneficiary's benefit recipient's life, as the
beneficiary benefit recipient shall nominate by written
designation duly acknowledged and filed with the retirement
board at as of the time date of retirement, or
Option III. Upon death of the beneficiary benefit
recipient, one-half of the beneficiary's benefit recipient's
annuity, pension, or retirement allowance shall be continued
throughout the life of and paid to such the person, having an
insurable interest in the beneficiary's benefit recipient's
life, as the beneficiary benefit recipient shall nominate by
written designation duly acknowledged and filed with the
retirement board at as of the time date of retirement, or
Option IV. Other benefits optional retirement allowance
forms shall be paid to the beneficiary benefit recipient or
such other person or persons as the beneficiary benefit
recipient shall nominate nominates, provided such other benefits
shall be certified by the executive director of the retirement
board to be that the optional annuity is of equivalent actuarial
value to the applicable single life annuity calculated under
section 422A.15 and is approved by the retirement board.
Any optional retirement allowance shall be computed and
determined under a procedure specified by the
commission-retained actuary utilizing the appropriate mortality
table established by the board of trustees based on the
experience of the fund as recommended by the commission-retained
actuary and using the applicable postretirement interest rate
assumption specified in section 356.215, subdivision 4d.
In adopting optional annuity forms, the board of trustees
shall obtain the written recommendation of the
commission-retained actuary. The recommendations shall be a
part of the permanent records of the board of trustees.
Sec. 77. Minnesota Statutes 1986, section 422A.23,
subdivision 6, is amended to read:
Subd. 6. [SURVIVOR BENEFIT EMPLOYEE CONTRIBUTION.] The
retirement board shall create a reserve account for survivor's
benefits from which shall be paid on an actuarial basis all such
survivor benefits due and payable. The board shall cause an At
the end of each fiscal year, as part of the annual actuarial
valuation of the fund prepared by the commission-retained
actuary, a determination of the normal cost of the benefits
payable from the survivor's benefit account to shall be made by
the board's actuary, and the board shall reduce or increase
the employee contribution rate of one fourth of one percent if
and when it is actuarially determined based on the annual
actuarial valuation that such the member contribution rate is in
excess of or is less than the amount necessary to pay for 50
percent of the calculated normal cost of the survivor benefits
herein provided in this section.
Sec. 78. Minnesota Statutes 1986, section 422A.23,
subdivision 7, is amended to read:
Subd. 7. [ACTIVE MEMBER SURVIVOR COVERAGE.] If the
contributing member dies after having been in the service of the
city 20 or more years, and before the effective date of
retirement, as determined by the retirement board, such the
board shall pay a monthly allowance for life to the designated
beneficiary of such the employee. The monthly allowance herein
provided for shall be the actuarial equivalent of a single life
service allowance specified in section 422A.15, subdivision 1,
which would have been payable to the employee on the date of
death, notwithstanding the age requirement stated therein in
section 422A.15, subdivision 1. For purposes of this section,
the amount of any excess contributions or voluntary additions by
the member shall not be included in the calculations in
determining the monthly allowance.
The survivor allowance under this subdivision shall be
computed and determined under a procedure specified by the
commission-retained actuary utilizing the appropriate mortality
table established by the board of trustees based on the
experience of the fund as recommended by the commission-retained
actuary and using the applicable postretirement interest rate
assumption specified in section 356.215, subdivision 4d.
Sec. 79. Minnesota Statutes 1986, section 490.121,
subdivision 20, is amended to read:
Subd. 20. [ACTUARIAL EQUIVALENT.] "Actuarial equivalent"
means the annual amount determined by calculations based on
mortality tables, purchasable with a given amount at a stated
age condition of one annuity or benefit having an equal
actuarial present value as another annuity or benefit,
determined as of a given date with each actuarial present value
based on the appropriate mortality table adopted by the board of
trustees based on the experience of the fund as recommended by
the commission-retained actuary and using the applicable
preretirement or postretirement interest rate assumption
specified in section 356.215, subdivision 4d.
Sec. 80. Minnesota Statutes 1986, section 490.124,
subdivision 11, is amended to read:
Subd. 11. [OPTIONAL ANNUITIES.] There shall be no survivor
or death benefits in connection with the death of a judge who
retires after December 31, 1973, except as otherwise provided
herein in sections 490.121 to 490.132. Within 30 days prior to
such before retirement, except as provided in subdivision 10, a
judge may elect to receive, in lieu of the normal retirement
annuity, an optional annuities retirement annuity which shall
take the form of either an annuity payable for a period certain
and for life thereafter or a joint and survivor annuity. Such
The optional annuities retirement annuity shall be actuarially
equivalent to an a single life annuity for life, with no term
certain, and shall be established by the governing body board of
directors of the Minnesota state retirement system upon. In
establishing these optional retirement annuity forms, the board
shall obtain the written recommendation of an approved the
actuary retained by the legislative commission on pensions and
retirement. The recommendations shall be a part of the
permanent records of the board.
Sec. 81. [TRANSITIONAL PROVISION.]
In establishing the correctional employees retirement fund
under section 20, the board of directors of the Minnesota state
retirement system shall allocate the assets currently held by
the state employees retirement fund between that fund and the
newly created fund. The assets shall be allocated based on the
actuarial valuations of the state employees retirement plan and
the correctional employees retirement plan prepared by the
actuary retained by the legislative commission on pensions and
retirement as of July 1, 1986, and adjusted for the actual
receipts of contributions and investment income and actual
disbursements of benefits, refunds, and administrative expenses
attributable to the correctional employees retirement plan
occurring between July 1, 1987, and the date on which the
correctional employees retirement fund is established.
Sec. 82. [TEMPORARY PROVISION.]
The provisions of sections 11, 12, 14 to 16, 23, 25, 28 to
30, 33, 35 to 38, 40, 44, 46, 47, 49, 61, 62, 65, 69, 71 to 74,
and 78 to 80 may not be construed to require any immediate
change in current actuarial assumptions, optional annuity forms,
optional annuity factors, and early retirement reduction factors
and shall only apply to any changes in these items after the
effective date of this section and may not be construed to
require any change without a significant deviation from actual
experience.
Sec. 83. [REPEALER.]
Minnesota Statutes 1986, section 352B.26, subdivision 2, is
repealed.
Sec. 84. [EFFECTIVE DATE.]
Sections 1 to 19 and 21 to 83 are effective on the day
following final enactment. Section 20 is effective as soon as
is practicable following final enactment.
Approved May 27, 1987
Official Publication of the State of Minnesota
Revisor of Statutes