Office of the Revisor of Statutes
Minnesota Session Laws - 1990, Regular Session
Key: (1) language to be deleted (2) new language
Laws of Minnesota 1990
CHAPTER 570-H.F.No. 2103
An act relating to retirement; various retirement
plans; including gambling enforcement division
officers in the membership of the state patrol
retirement plan; requiring regular investment
performance reporting from public pension plans;
modifying various retirement provisions related to
state university and community college faculty
members; including certain state lottery employees in
the unclassified state employees retirement programs;
modifying economic interest statement requirements for
certain pension plan fiduciaries; changing schedule
for actuarial valuations for the Thief River Falls
police pension trust fund; excluding certain interns
from public employees retirement association
membership; extending retirement coverage to certain
former crime bureau employees; restoring forfeited
service credit for certain former St. Paul bureau of
health employees; authorizing the transfer of the
Moose Lake volunteer firefighters relief association;
authorizing additional college supplemental retirement
plan designated beneficiaries; authorizing service
credit for medical leave periods in teacher retirement
plans; authorizing annuitization of certain teacher
postretirement amounts; expanding coverage of a public
employees defined contribution plan to include elected
local government employees; transferring certain
employer contributions from the teachers retirement
association to the individual retirement account plan
for post-June 30, 1988, state university and community
college faculty; modifying the Minnesota
postretirement investment fund reserve transfer
procedure; making certain administrative modifications
in Minnesota state retirement system and in public
employees retirement association laws; making certain
technical corrections related to the 1989 benefit
increase legislation; authorizing various purchases of
credit for prior service; modifying the flexible
service pension maximums for volunteer firefighters
relief associations providing monthly service
pensions; repealing a redundant postretirement
adjustment provision; amending Minnesota Statutes
1988, sections 3A.03, subdivision 2; 11A.18,
subdivision 6; 43A.34, subdivision 4; 136.81, by
adding a subdivision; 352.01, subdivision 13; 352.029,
subdivision 3; 352.03, subdivision 1; 352.115,
subdivision 7; 352.73, by adding a subdivision;
352.96, subdivision 4; 352B.01, subdivision 2;
352B.11, subdivision 4; 352B.14, subdivision 4;
352C.09, subdivision 2; 352D.02, subdivision 1;
352D.05, subdivision 3; 353.01, subdivisions 7 and 16;
353.15, subdivision 2; 353.27, subdivisions 7 and 10;
353.46, subdivision 4; 353.657, subdivision 1; 353.83;
353D.01; 353D.02; 353D.03; 353D.04; 353D.05,
subdivisions 1 and 3; 353D.06; 353D.07; 353D.08;
353D.09; 354.07, subdivision 4; 354.146, subdivision
1; 354.42, subdivisions 2 and 3; 354.46, subdivision
1; 354.52, subdivision 2; 354.55, subdivision 19;
354B.01, subdivisions 2 and 3; 356.302, subdivisions 3
and 4; 424A.02, subdivision 3; Minnesota Statutes 1989
Supplement, sections 136.81, subdivision 1; 136.82,
subdivisions 1 and 2; 352.01, subdivisions 2b and 25;
352.021, subdivision 5; 352.031, subdivisions 2, 3,
and by adding a subdivision; 352.115, subdivision 3;
352.116, subdivisions 1 and 1a, and by adding a
subdivision; 352.93, subdivisions 2a and 3; 352B.08,
subdivisions 2a and 3; 352B.11, subdivision 2; 353.01,
subdivisions 2b, 11a, and 37; 353.29, subdivision 3;
353.30; 353.35; 353.651, subdivision 4; 353.656,
subdivisions 1 and 3; 354.05; 354.071, subdivisions 2,
3, and by adding a subdivision; 354.44, subdivision 6;
354.45, subdivision 1a; 354.46, subdivision 2; 354.47,
subdivision 1; 354.48, subdivision 3; 354.49,
subdivisions 2 and 3; 354.50, subdivision 5; 354.55,
subdivision 11; 354.65; 354.66, subdivision 2;
354A.011, subdivision 5a; 354A.095; 354A.31,
subdivisions 4, 6, and 7; 354A.32, subdivisions 1 and
1a; 354B.02, subdivisions 2, 3, and by adding a
subdivision; 354B.03, subdivisions 1 and 3; 354B.05,
subdivision 3; 356.371, subdivision 3; 356.86,
subdivisions 2, 4, 5, and 6; 356A.06, subdivision 4;
Laws 1978, chapter 689, section 4, subdivision 2, as
amended; Laws 1980, chapter 612, section 3, as
amended; Laws 1989, chapter 319, articles 17, section
18; and 19, section 7, subdivision 4; proposing coding
for new law in Minnesota Statutes, chapters 353D; 354;
354A; and 356; repealing Minnesota Statutes 1988,
sections 11A.19, subdivisions 1 to 8; 136.81,
subdivisions 2 and 3; 136.82, subdivisions 3 and 4;
136.83; 136.85; 354.05, subdivisions 23, 24, 33, and
34; 354.146, subdivision 2; 354.62, subdivisions 1, 3,
4, 5, and 6; Minnesota Statutes 1989 Supplement,
sections 11A.19, subdivision 9; 136.82, subdivisions 1
and 2; 136.84; 353.87, subdivision 5; 354.44,
subdivision 7; and 354.62, subdivisions 2 and 7; and
Laws 1989, chapter 335, article 1, section 50.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:
ARTICLE 1
STATE PATROL RETIREMENT PLAN MEMBERSHIP
Section 1. Minnesota Statutes 1988, section 43A.34,
subdivision 4, is amended to read:
Subd. 4. [STATE PATROL, CONSERVATION AND CRIME BUREAU
OFFICERS EXEMPTED.] Notwithstanding any provision to the
contrary, (a) conservation officers and crime bureau officers
who were first employed on or after July 1, 1973, and who are
members of the state patrol retirement fund by reason of their
employment, and members of the Minnesota state patrol division
and gambling enforcement divisions of the department of public
safety who are members of the state patrol retirement
association by reason of their employment, shall not continue
employment after attaining the age of 60 years, except for a
fractional portion of one year that will enable the employee to
complete the employee's next full year of allowable service as
defined pursuant to section 352B.01, subdivision 3; and (b)
conservation officers and crime bureau officers who were first
employed and are members of the state patrol retirement fund by
reason of their employment before July 1, 1973, shall not
continue employment after attaining the age of 70 years.
Sec. 2. Minnesota Statutes 1989 Supplement, section
352.01, subdivision 2b, is amended to read:
Subd. 2b. [EXCLUDED EMPLOYEES.] "State employee" does not
include:
(1) elective state officers;
(2) students employed by the University of Minnesota, the
state universities, and community colleges unless approved for
coverage by the board of regents, the state university board, or
the state board for community colleges, as the case may be;
(3) employees who are eligible for membership in the state
teachers retirement association except employees of the
department of education who have chosen or may choose to be
covered by the Minnesota state retirement system instead of the
teachers retirement association;
(4) employees of the University of Minnesota who are
excluded from coverage by action of the board of regents;
(5) officers and enlisted personnel in the national guard
and the naval militia who are assigned to permanent peacetime
duty and who under federal law are or are required to be members
of a federal retirement system;
(6) election officers;
(7) persons engaged in public work for the state but
employed by contractors when the performance of the contract is
authorized by the legislature or other competent authority;
(8) officers and employees of the senate and house of
representatives or a legislative committee or commission who are
temporarily employed;
(9) receivers, jurors, notaries public, and court employees
who are not in the judicial branch as defined in section 43A.02,
subdivision 25, except referees and adjusters employed by the
department of labor and industry;
(10) patient and inmate help in state charitable, penal,
and correctional institutions including the Minnesota veterans
home;
(11) persons employed for professional services where the
service is incidental to regular professional duties and whose
compensation is paid on a per diem basis;
(12) employees of the Sibley House Association;
(13) employees of the Grand Army of the Republic and
employees of the ladies of the G.A.R.;
(14) the members of any state board or commission who serve
the state intermittently and are paid on a per diem basis; the
secretary, secretary-treasurer, and treasurer of those boards if
their compensation is $500 or less per year, or, if they are
legally prohibited from serving more than two consecutive terms
and their total service is required by law to be less than ten
years; and the board of managers of the state agricultural
society and its treasurer unless the treasurer is also its
full-time secretary;
(15) state troopers;
(16) temporary employees of the Minnesota state fair
employed on or after July 1 for a period not to extend beyond
October 15 of that year; and persons employed at any time by the
state fair administration for special events held on the
fairgrounds;
(17) emergency employees in the classified service; except
that if an emergency employee, within the same pay period,
becomes a provisional or probationary employee on other than a
temporary basis, the employee shall be considered a "state
employee" retroactively to the beginning of the pay period;
(18) persons described in section 352B.01, subdivision 2,
clauses (b) and (c), formerly defined as state police
officers (2) to (5);
(19) temporary employees in the classified service,
temporary employees in the unclassified service appointed for a
definite period of not more than six months and employed less
than six months in any one-year period and seasonal help in the
classified service employed by the department of revenue;
(20) trainees paid under budget classification number 41,
and other trainee employees, except those listed in subdivision
2a, clause (10);
(21) persons whose compensation is paid on a fee basis;
(22) state employees who in any year have credit for 12
months service as teachers in the public schools of the state
and as teachers are members of the teachers retirement
association or a retirement system in St. Paul, Minneapolis, or
Duluth;
(23) employees of the adjutant general employed on an
unlimited intermittent or temporary basis in the classified and
unclassified service for the support of army and air national
guard training facilities;
(24) chaplains and nuns who have taken a vow of poverty as
members of a religious order;
(25) labor service employees employed as a laborer 1 on an
hourly basis;
(26) examination monitors employed by departments,
agencies, commissions, and boards to conduct examinations
required by law;
(27) members of appeal tribunals, exclusive of the chair,
to which reference is made in section 268.10, subdivision 4;
(28) persons appointed to serve as members of fact-finding
commissions or adjustment panels, arbitrators, or labor referees
under chapter 179;
(29) temporary employees employed for limited periods under
any state or federal program for training or rehabilitation
including persons employed for limited periods from areas of
economic distress except skilled and supervisory personnel and
persons having civil service status covered by the system;
(30) full-time students employed by the Minnesota
historical society intermittently during part of the year and
full-time during the summer months;
(31) temporary employees, appointed for not more than six
months, of the metropolitan council and of any of its statutory
boards, if the board members are appointed by the metropolitan
council;
(32) persons employed in positions designated by the
department of employee relations as student workers;
(33) any person who is 65 years of age or older when
appointed and who does not have allowable service credit for
previous employment, unless the employee gives notice to the
director within 60 days after appointment that coverage is
desired;
(34) members of trades employed by the metropolitan waste
control commission with trade union pension plan coverage under
a collective bargaining agreement first employed after June 1,
1977;
(35) persons employed in subsidized on-the-job training,
work experience, or public service employment as enrollees under
the federal Comprehensive Employment and Training Act after
March 30, 1978, unless the person has as of the later of March
30, 1978, or the date of employment sufficient service credit in
the retirement system to meet the minimum vesting requirements
for a deferred annuity, or the employer agrees in writing on
forms prescribed by the director to make the required employer
contributions, including any employer additional contributions,
on account of that person from revenue sources other than funds
provided under the federal Comprehensive Employment and Training
Act, or the person agrees in writing on forms prescribed by the
director to make the required employer contribution in addition
to the required employee contribution;
(36) off-duty peace officers while employed by the
metropolitan transit commission under section 629.40,
subdivision 5; and
(37) persons who are employed as full-time firefighters by
the department of military affairs and as firefighters are
members of the public employees police and fire fund.
Sec. 3. Minnesota Statutes 1988, section 352B.01,
subdivision 2, is amended to read:
Subd. 2. [MEMBER.] "Member" means:
(a) (1) persons referred to and employed after June 30,
1943, under Laws 1929, chapter 355, as amended or supplemented,
currently employed by the state, whose salaries or compensation
is paid out of state funds;
(b) (2) a conservation officer employed under section
97A.201, currently employed by the state, whose salary or
compensation is paid out of state funds; and
(c) (3) a crime bureau officer who was employed by the
crime bureau and was a member of the highway patrolmen's
retirement fund on July 1, 1978, whether or not that person has
the power of arrest by warrant after that date, or who is
employed as police personnel, with powers of arrest by warrant
under section 299C.04, and who is currently employed by the
state, and whose salary or compensation is paid out of state
funds;
(4) a person who is employed by the state in the department
of public safety in a data processing management position with
salary or compensation paid from state funds, who was a crime
bureau officer covered by the state patrol retirement plan on
August 15, 1987, and who was initially hired in the data
processing management position within the department during
September 1987, or January 1988, with membership continuing for
the duration of the person's employment in that position,
whether or not the person has the power of arrest by warrant
after August 15, 1987; and
(5) public safety employees defined as peace officers in
section 626.84, subdivision 1, paragraph (c), and employed with
the division of gambling enforcement under section 299L.01.
Sec. 4. Minnesota Statutes 1988, section 352B.14,
subdivision 4, is amended to read:
Subd. 4. [RETIREES UNDER OLD LAW.] A member defined in
section 352B.01, subdivision 2, clause (a) (1), who has retired
and began collecting a retirement annuity before April 21, 1961,
or any surviving spouse or child who began collecting an annuity
or benefit before April 21, 1961, shall continue to receive an
annuity or benefit in the amount and subject to the conditions
specified in the law before April 21, 1961.
Sec. 5. [PAYMENT OF OMITTED CONTRIBUTION AMOUNTS.]
(a) A person affected by section 3 who has not made the
full member contribution to the state patrol retirement plan for
service before the effective date of this section shall pay the
amount of omitted member contributions, plus annual compound
interest at the rate of 8.5 percent. The omitted member
contribution amount and interest must be paid by January 1,
1991. The person shall be paid a refund from any other
Minnesota public pension plan for the period of the omitted
member contributions and service credit for that period in that
plan is forfeited upon receipt of the refund.
(b) Upon payment of the omitted member contribution amount
under paragraph (a), the department of public safety shall pay
an amount equal to the amount of the omitted member contribution
multiplied by the factor of 2.224. This omitted employer
contribution must be paid within 30 days of the payment of the
omitted member contribution amount.
Sec. 6. [EFFECTIVE DATE.]
Sections 1 to 5 are effective on the day following final
enactment.
ARTICLE 2
PENSION PLAN INVESTMENT PERFORMANCE REPORTING
Section 1. [356.218] [INVESTMENT PERFORMANCE REPORT.]
Subdivision 1. [REPORT REQUIRED.] (a) Unless paragraph (c)
applies, the chief administrative officer of a public pension
plan with an associated pension fund or investment fund
specified in subdivision 2 shall annually prepare and file an
investment performance report meeting the contents requirements
of subdivision 3. The report must be filed with or distributed
as specified in paragraph (b) by April 1 each year and must
cover the previous calendar year. The report must be prepared
under the supervision or at the direction of the chief
administrative officer and must be signed by that officer. The
investment performance report is a public record.
(b) A copy of the report or a synopsis of the report must
be distributed to each member of the pension plan and must be
filed with the chief administrative officer of each employing
unit making employer contributions to the pension plan. A copy
of the report also must be filed with the executive director of
the legislative commission on pensions and retirement.
(c) This section does not apply to the state board of
investment. This section also does not apply to a public
pension plan if all assets of the pension fund or investment
fund attributable to the public pension plan are invested by the
state board of investment under chapters 11A and 356A and if the
executive director of the state board of investment makes public
in an annual report or in other documents the fiscal year
investment performance results of the pension fund or investment
fund attributable to the pension plan that substantially meet
the requirements of subdivision 3 for that fiscal year period.
Subd. 2. [COVERED PUBLIC PENSION PLANS.] The provisions of
this section apply to any Minnesota public pension plan,
including a local police or firefighters relief association
governed by sections 69.77 or 69.771 to 69.775, that has assets
with a book value of at least $500,000 as of the end of the
preceding plan year.
Subd. 3. [CONTENTS OF THE INVESTMENT PERFORMANCE
REPORT.] The investment performance report required by this
section must contain the time-weighted total rate of return
results for each quarter and annually for each significant asset
class or type of investment and for the portfolio as a whole.
The time-weighted rate of return results must be computed using
market values and the formula or formulas prescribed by the
state board of investment under section 11A.04, clause (11).
The person performing the calculations shall certify conformance
to that formula or those formulas. The investment performance
report may also include any additional investment performance or
investment related information that the chief administrative
officer considers necessary to provide an adequate summary of
the performance of the portfolio. The additional information
must be clearly indicated as a supplement to the information
required by this subdivision. The executive director of the
legislative commission on pensions and retirement shall
prescribe the forms on which the report must be submitted and
may prescribe other directions for submitting the report.
Sec. 2. [EFFECTIVE DATE.]
Section 1 is effective on July 1, 1990.
ARTICLE 3
STATE UNIVERSITY AND COMMUNITY COLLEGE
FACULTY RETIREMENT PROVISIONS
Section 1. Minnesota Statutes 1989 Supplement, section
136.81, subdivision 1, is amended to read:
Subdivision 1. [DEDUCTIONS.] The state university board
and the state board for community colleges shall deduct from the
salary of each person described in section 136.80, subdivision
1, a sum equal to five percent of the person's annual salary
paid between $6,000 and $15,000. The deduction must be made in
the same manner as other retirement deductions are made from the
salary of the person. The employer shall make a contribution to
the plan on behalf of every covered person in an amount equal to
the deductions made from the salary of the person. If an
agreement is made under section 356.24 for additional employer
contributions, an amount equal to the additional employer
contribution must be deducted from the person's annual salary
above $15,000 as specified in this subdivision. The money
deducted and the employer contribution must be deposited to the
credit of the state university and community college
supplemental retirement plan account of the teachers retirement
fund. The account must be separate and distinct from other
funds, accounts, or assets of the teachers retirement fund. Two
percent of the amount of the salary deductions and employer
contributions must be credited to the administrative expense
reserve account of the supplemental retirement plan and must may
be used by the state university board and the state board for
community colleges for payment of necessary and reasonable
administrative expenses of the supplemental retirement plan as
provided in section 354.65.
Deductions taken from the salary of a person for the
supplemental retirement plan in error must, upon discovery and
verification, be refunded to the person. Any related employer
contributions must be refunded to the employer. The executive
director shall establish a reserve reflecting any gains or
losses realized due to the purchase and redemption of shares
representing salary deductions and employer contributions made
in error. The balance of the reserve remaining after the refund
of contributions made in error must be credited annually to the
administrative expense reserve account.
If salary deductions required under this section are
omitted, the amount of the omitted salary deductions may be
remitted by the person to the supplemental retirement plan
investment account of the teachers retirement association within
90 days following the association's written notification to the
person of the omission, but not thereafter. If the omitted
salary deductions are received from the person, the required
employer contribution must be paid by the employer within 30
days after the association's written notification to the
employer of the amount due.
Sec. 2. Minnesota Statutes 1988, section 136.81, is
amended by adding a subdivision to read:
Subd. 1a. [ADMINISTRATION.] The executive director of the
teachers retirement association shall transfer the
administration records of the supplemental retirement plan to
the chancellor of the state university system and the chancellor
of the state community college system on July 1, 1991. The
chancellor of the state university system and the chancellor of
the state community college system shall administer the
supplemental retirement plan for their employees. The
chancellors shall invest contributions made under this section,
less amounts used for administrative expenses, as required by
section 354B.05, subdivisions 2 and 3. The retirement
contributions and death benefits provided by annuity contracts
or custodial accounts purchased by the chancellors are owned by
the plan and must be paid in accordance with the provisions of
the annuity contracts or custodial accounts.
Sec. 3. Minnesota Statutes 1989 Supplement, section
136.82, subdivision 1, is amended to read:
Subdivision 1. [GENERALLY.] (a) The executive director of
the teachers retirement fund shall redeem shares in the accounts
of the Minnesota supplemental retirement investment fund
standing in an employee's share account record under the
following circumstances, but always in accordance with the laws
and rules governing the Minnesota supplemental retirement
investment fund:
(b) The executive director shall redeem shares under this
subdivision when requested to do so in writing on forms provided
by the executive director by a person having shares to the
credit of the employee's share account record if the person is
age 55 or older and is no longer employed by the state
university board or state board for community colleges. In such
case the person must receive the cash realized on the redemption
of the shares. The person may direct the redemption of not more
than 20 percent of the person's shares in the employee's share
account record in any one year and may not direct more than one
redemption in any one calendar month; provided, however, that
the state university board or its designee, in the case of a
person employed by the state university board, and the state
board for community colleges or its designee, in the case of a
person employed by the state board for community colleges, may,
upon application, at their sole discretion, permit greater
withdrawals in any one year.
(c) The executive director shall redeem shares under this
subdivision when requested to do so in writing, on forms
provided by the executive director, by a person having shares to
the credit of the employee's share account record if the person
has left employment by the state university board or state board
for community colleges because of a total and permanent
disability as defined in section 354.05, subdivision 14. If the
executive director finds that the person is totally and
permanently disabled and will as a result be unable to return to
similar employment, the person must receive the cash realized on
the redemption of the shares. The person may direct the
redemption of not more than 20 percent of the shares in the
employee's share account record in any one year and may not
direct more than one redemption in any one calendar month;
provided, however, that the state university board or its
designee, in the case of a person employed by the state
university board, and the state board for community colleges or
its designee, in the case of a person employed by the state
board for community colleges, may, upon application, at their
sole discretion, permit greater withdrawals in any one year. If
the person returns to good health, the person owes no
restitution to the state or a fund established by its laws for a
redemption under this paragraph.
(d) The executive director shall redeem shares under this
subdivision in the event of the death of a person having shares
to the credit of the employee's share account record and leaving
a surviving spouse designated beneficiary, when requested to do
so in writing, on forms provided by the executive director, by
the surviving spouse designated beneficiary. The surviving
spouse designated beneficiary must receive the cash realized on
the redemption of the shares. If the designated beneficiary is
a surviving spouse, the surviving spouse may direct the
redemption of not more than 20 percent of the shares in the
deceased spouse's person's employee's share account record in
any one year and may not direct more than one redemption in any
one calendar month; provided, however, that the state university
board or its designee, in the case of a person employed by the
state university board, and the state board for community
colleges or its designee, in the case of a person employed by
the state board for community colleges, may, upon application,
their sole discretion, permit greater withdrawals in any one
year. In that case the surviving spouse must receive the cash
realized from the redemption of the shares. Upon the death of
the surviving spouse any shares remaining in the employee's
share account record must be redeemed by the executive director
and the cash realized from the redemption must be distributed to
the estate of the surviving spouse.
(e) In the event of the death of a person having shares to
the credit of the employee's share account record and leaving no
designated beneficiary, the surviving spouse must receive the
cash realized on the redemption of the shares as provided in
paragraph (d). If there is no surviving spouse, the executive
director shall redeem all shares to the credit of the employee's
share account record and pay the cash realized from the
redemption to the estate of the deceased person.
(f) The executive director shall redeem shares under this
subdivision when requested to do so in writing, on forms
provided by the executive director, by a person having shares to
the credit of the employee's share account record if the person
is no longer employed by the state university board or state
board for community colleges, but does not qualify under the
provisions of paragraphs (b) to (e). In that case, the person
is entitled upon application to receive one-half of the cash
realized on the redemption of shares and one-half must be
credited to the administrative expense reserve account of the
supplemental retirement plan for payment of necessary and
reasonable administrative expenses of the supplemental
retirement plan as provided in section 354.65.
Sec. 4. Minnesota Statutes 1989 Supplement, 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 no longer
employed by the state university board or the state board for
community colleges or who is totally and permanently disabled
pursuant to subdivision 1, paragraph (c), or who has the status
of a surviving spouse of a person who has shares to the credit
of the employee's share account pursuant to subdivision 1,
paragraph (d) or (e), may redeem all or part of the shares to
purchase an annuity by depositing the cash realized upon
redemption with the executive director of the teachers
retirement fund and receive in exchange 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. If
an election is made 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 to
make the request. The annuity purchase rates shall be based on
the annuity table of mortality 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 that amount which has a present value
equal to 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 the actuary 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. 5. Minnesota Statutes 1988, section 354B.01,
subdivision 2, is amended to read:
Subd. 2. [COVERED EMPLOYMENT; STATE UNIVERSITIES.]
"Covered employment," with respect to employment by the state
university system, means employment in a position included in
the definition of teacher under section 354.05, subdivision 2,
other than that of an administrator covered by or eligible for
coverage in the Minnesota state retirement system unclassified
employees retirement plan. "Covered employment" does not
include employment when the initial appointment is defined as
less than 25 percent of a full academic year, exclusive of
summer session.
Sec. 6. Minnesota Statutes 1988, section 354B.01,
subdivision 3, is amended to read:
Subd. 3. [COVERED EMPLOYMENT; COMMUNITY COLLEGES.]
"Covered employment," with respect to employment by the
community college system, means employment in a position
included in the definition of teacher under section 354.05,
subdivision 2. "Covered employment" does not include employment
when the initial appointment is defined as less than 25 percent
of a full academic year, exclusive of summer session.
Sec. 7. Minnesota Statutes 1989 Supplement, section
354B.02, is amended by adding a subdivision to read:
Subd. 4. [PURCHASE OF PRIOR SERVICE CREDIT.] A person who
is initially excluded from participation, but is subsequently
appointed to a position that qualifies for participation, may
purchase credit for the prior uncovered employment. This
purchase must be made by paying to the employer the amount the
person would have paid if the prior service had been covered
employment. This payment must be made within 45 days of the
start of covered employment. The employer must contribute an
amount to match any contribution made by an employee under this
subdivision. Contributions for prior service must be invested
under this section. Once a person is employed in a position
that qualifies for participation, all subsequent employment by
the person is under the provisions of this plan.
Sec. 8. Minnesota Statutes 1989 Supplement, section
354B.03, subdivision 1, is amended to read:
Subdivision 1. [PROCEDURE.] If a person with less than
three years of allowable service elects a transfer to the plan
under section 354B.02, subdivision 2 or 3, the executive
director of the teachers retirement association shall transfer
from the teachers retirement fund to the plan the person's
member contributions plus interest compounded annually at five
six percent a year. The transfer must be made within 90 days
from the date the executive director receives notification of
the election. The transfer may not include any amount
representing an employer contribution nor any amount
representing the repayment of a refund received by the
association after the date of enactment of this act.
Sec. 9. Minnesota Statutes 1989 Supplement, section
354B.05, subdivision 3, is amended to read:
Subd. 3. [SELECTION OF FINANCIAL INSTITUTIONS.] The
supplemental investment fund administered by the state board of
investment is one of the investment options for the plan. The
state university board and the community college board shall
select no more than three two other financial institutions to
provide annuity contracts or custodial accounts. Each board may
at its discretion change a selection of an institution.
Investment programs offered by the institutions must meet the
requirements of section 401(a) or 403(b) of the Internal Revenue
Code of 1986, as amended. In making their selections, the
boards shall consider these criteria:
(1) the experience and ability of the financial institution
to provide retirement and death benefits suited to the needs of
the covered employees;
(2) the relationship of the benefits to their cost; and
(3) the financial strength and stability of the institution.
The chancellor of the state university system and the
chancellor of the state community college system shall redeem
all shares in the accounts of the Minnesota supplemental
investment fund held on behalf of personnel in the supplemental
plan who elect an investment option other than the supplemental
investment fund, except that shares in the guaranteed return
account must not be redeemed until the expiration dates for the
guaranteed investment contracts. The chancellors shall transfer
the cash realized to the financial institutions selected by the
state university board and the community college board under
section 354B.05.
Sec. 10. [INTEREST ON CERTAIN PRIOR TRANSFERS.]
The increase in interest payable on transfers specified in
section 8 is also payable on transfers made before the effective
date of section 8. The executive director of the teachers
retirement association shall calculate the transfer interest
amounts payable on these prior transfers and transfer the
additional interest within 60 days of the effective date of this
section.
Sec. 11. [TRANSFERS IN CERTAIN CASES.]
Notwithstanding any provision of Minnesota Statutes,
section 354B.03, to the contrary, a person in covered employment
under Minnesota Statutes, chapter 354, who was first employed by
the state university system board or the community college board
after June 30, 1988, and before July 1, 1989, and who has no
prior allowable service under chapter 354, and who elected, or
elects before January 1, 1991, to have their employee
contributions transferred under Minnesota Statutes, chapter
354B, shall have an amount equal to the employer contributions
made on behalf of the person under Minnesota Statutes, section
354.42, subdivision 3, plus annual interest compounded annually
at a rate of six percent, transferred by the executive director
of the teachers retirement association from the teachers
retirement fund to the individual retirement account plan under
Minnesota Statutes, chapter 354B. The election must be made on
a form prescribed by the executive director and must be made by
January 1, 1991.
Sec. 12. [REPEALER.]
Minnesota Statutes 1988, sections 136.81, subdivisions 2
and 3; 136.82, subdivisions 3 and 4; 136.83; and 136.85, are
repealed. Minnesota Statutes 1989 Supplement, sections 136.82,
subdivisions 1 and 2, as amended by sections 3 and 4; and
136.84, are repealed.
Sec. 13. [EFFECTIVE DATE.]
Sections 1, 2, 9, and 12 are effective July 1, 1991.
Sections 3 to 8, 10, and 11 are effective the day following
final enactment.
ARTICLE 4
UNCLASSIFIED RETIREMENT PROGRAM MEMBERSHIP
Section 1. Minnesota Statutes 1988, section 352D.02,
subdivision 1, is amended to read:
Subdivision 1. [COVERAGE.] The following (a) Employees
enumerated in paragraph (b), if they are in the unclassified
service of the state and are eligible for coverage under
the general state employees retirement fund plan under chapter
352, shall participate are participants in the unclassified
program under this chapter unless an the employee gives notice
to the executive director of the Minnesota state retirement
system within one year following the commencement of employment
in the unclassified service that the employee desires coverage
under the regular employee general state employees retirement
plan. For the purposes of this chapter, an employee who does
not file notice with the executive director shall be is deemed
to have exercised the option to participate in the unclassified
plan.
(b) Enumerated employees are:
(1) any an employee in the office of the governor,
lieutenant governor, secretary of state, state auditor, state
treasurer, attorney general or an employee of the state board of
investment,;
(2) the head of any a department, division, or agency
created by statute in the unclassified service, an acting
department head subsequently appointed to the position, or any
an employee enumerated in section 15A.081, subdivision 1 or
15A.083, subdivision 4,;
(3) any a permanent, full-time unclassified employee of the
legislature or any a commission or agency of the legislature or
a temporary legislative employee having shares in the
supplemental retirement fund as a result of former employment
covered by this chapter, whether or not eligible for coverage
under the Minnesota state retirement system,;
(4) any a person employed in a position established
pursuant to under section 43A.08, subdivision 1, clause (c), or
subdivision 1a, or in a position authorized under a statute
creating or establishing a department or agency of the state,
which is at the deputy or assistant head of department or agency
or director level,;
(5) the chair, chief administrator, and not to exceed nine
positions at the division director or administrative deputy
level of the metropolitan waste control commission as designated
by the commission; the chair, executive director, and not to
exceed three positions at the division director or assistant to
the chair level of the regional transit board; a chief
administrator who is an employee of the metropolitan transit
commission; and the chair, executive director, and not to exceed
nine positions at the division director or administrative deputy
level of the metropolitan council as designated by the council;
provided that upon initial designation of all positions provided
for in this clause, no further designations or redesignations
shall may be made without approval of the board of directors of
the Minnesota state retirement system,;
(6) the executive director, associate executive director,
and not to exceed nine positions of the higher education
coordinating board in the unclassified service, as designated by
the higher education coordinating board; provided that upon
initial designation of all positions provided for in this
clause, no further designations or redesignations shall may be
made without approval of the board of directors of the Minnesota
state retirement system,;
(7) the clerk of the appellate courts appointed pursuant to
under article VI, section 2, of the Constitution of the state of
Minnesota,;
(8) the chief executive officers of correctional facilities
operated by the department of corrections and of hospitals and
nursing homes operated by the department of human services,;
(9) any an employee whose principal employment is at the
state ceremonial house,;
(10) employees an employee of the Minnesota educational
computing corporation, and;
(11) any an employee of the world trade center board.; and
(12) an employee of the division of the state lottery in
the department of gaming who is covered by the managerial plan
established under section 43A.18, subdivision 3.
Sec. 2. [TRANSFER OF ASSETS.]
An unclassified employee of the division of the state
lottery in the department of gaming on the effective date of
this section who is covered by the managerial plan established
under Minnesota Statutes, section 43A.18, subdivision 3, and who
was covered by the general state employees retirement plan under
Minnesota Statutes, chapter 352, while employed as an
unclassified employee of the division of the state lottery may
transfer accumulated employee and employer contributions made
while employed with the division of the state lottery to the
unclassified plan, as provided in Minnesota Statutes, section
352D.03.
Sec. 3. [EFFECTIVE DATE.]
Sections 1 and 2 are effective the day following final
enactment and apply to any person who was employed with the
division of the state lottery in the department of gaming and
who is covered by the managerial plan established under
Minnesota Statutes, section 43A.18, subdivision 3, before that
date and after that date.
ARTICLE 5
FIDUCIARY RESPONSIBILITY MODIFICATIONS
Section 1. Minnesota Statutes 1989 Supplement, section
356A.06, subdivision 4, is amended to read:
Subd. 4. [ECONOMIC INTEREST STATEMENT.] (a) Each member of
the governing board of a covered pension plan and the chief
administrative officer of the plan shall file with the plan a
statement of economic interest.
(b) For a covered pension plan other than a plan specified
in paragraph (c), the statement must contain the information
required by section 10A.09, subdivision 5, and any other
information that the fiduciary or the governing board of the
plan determines is necessary to disclose a reasonably
foreseeable potential or actual conflict of interest.
(c) For a covered pension plan governed by sections 69.771
to 69.776 or a covered pension plan governed by section 69.77
with assets under $8,000,000, the statement must contain the
following:
(1) the person's principal occupation and principal place
of business;
(2) whether or not the person has an ownership of or
interest of ten percent or greater in an investment security
brokerage business, a real estate sales business, an insurance
agency, a bank, a savings and loan, or another financial
institution; and
(3) any relationship or financial arrangement that can
reasonably be expected to give rise to a conflict of interest.
(d) The statement must be filed annually with the chief
administrative officer of the plan and be available for public
inspection during regular office hours at the office of the
pension plan.
(e) A disclosure form meeting the requirements of the
federal Investment Advisers Act of 1940, United States Code,
title 15, sections 80b-1 to 80b-21 as amended, and filed with
the state board of investment or the pension plan meets the
requirements of this subdivision.
Sec. 2. [EFFECTIVE DATE.]
Section 1 is effective the day following final enactment.
ARTICLE 6
MISCELLANEOUS LOCAL PENSION MODIFICATIONS
Section 1. Laws 1978, chapter 689, section 4, subdivision
2, as amended by Laws 1981, chapter 224, section 272, is amended
to read:
Subd. 2. [THIEF RIVER FALLS POLICE RETIREMENT PENSION
TRUST FUND; REPORTING ACTUARIAL VALUATION.] Upon the transfer of
money and the establishment of the trust fund pursuant to
subdivision 1 and periodically thereafter, the board of trustees
shall have an actuarial valuation or survey and experience study
made of the trust fund in accordance with the filing
requirements and applicable actuarial standards set forth in the
general statute governing actuarial reporting by police and fire
funds, except that the actuarial valuation and experience study
need be made at least once every five years. The board of
trustees shall also complete and file a financial report for the
trust fund in accordance with Minnesota Statutes, Section 69.051.
Sec. 2. Laws 1980, chapter 612, section 3, as amended by
Laws 1981, chapter 301, section 4, is amended to read:
Sec. 3. [SAINT PAUL AND MINNEAPOLIS, CITIES OF; EMPLOYMENT
OF UNIVERSITY OR COLLEGE STUDENTS.]
Notwithstanding any contrary provision of the Saint Paul
city charter and the Minneapolis city charter, or, a statute,
including the veterans preference act, or a civil service rule
or regulation, the governing body or any board or commission of
the city of Saint Paul and the city of Minneapolis having
authority to hire employees may employ university, college, or
professional school students pursuant to an intern or other
training program when the program is sponsored or substantially
financed by the state or the United States or by a philanthropic
foundation or organization. Persons hired under a program shall
be in the unclassified service of the city and serve at the
pleasure of the body employing them. No full time appointment
under this section shall exceed one year. Persons employed
under this section shall be excluded from the provisions of
Minnesota Statutes, Sections 268.03 to 268.24, and Minnesota
Statutes, Chapters 353 and 356.
Sec. 3. [MOOSE LAKE FIREFIGHTERS' RELIEF ASSOCIATION
ASSETS.]
Notwithstanding the requirements of Minnesota Statutes,
section 424A.02, or any other law, for firefighters' relief
association purposes the Moose Lake area fire protection
district must be treated as a continuation of the fire
department of the city of Moose Lake. Assets of the Moose Lake
fire department relief association must be transferred to a
relief association now or hereafter established by the district
and service of transferred members must be considered continuous
for purpose of computing retirement benefits.
Sec. 4. [PURCHASE OF SERVICE CREDIT FOR ST. PAUL BUREAU OF
HEALTH SERVICE.]
Subdivision 1. [ELIGIBILITY.] A person who was born on May
28, 1941, who was initially employed by the St. Paul bureau of
health in November 1963, who was covered by the St. Paul bureau
of health relief association under Laws 1919, chapter 430,
sections 1 to 9, as amended, by virtue of that employment, who
terminated employment by the St. Paul bureau of health in August
1966, and who became a member of the general plan of the public
employees retirement association in May 1967, is entitled to
purchase service credit in the general plan of the public
employees retirement association for any months of employment by
the St. Paul bureau of health in which member contributions to
the St. Paul bureau of health relief association were made.
Subd. 2. [PURCHASE PAYMENT AMOUNT.] (a) The person
requesting the purchase of prior service shall establish in the
records of the fund or association proof of the service for
which the purchase of prior service is requested. The manner of
the proof of service must be in accordance with procedures
prescribed by the executive director of the public employees
retirement association. For a person eligible to purchase
credit under subdivision 1, there must be paid to the public
employees retirement association an amount on the date of
payment equal to the amount computed in paragraph (b) minus the
amount computed in paragraph (c).
(b) The present value, on the date of payment, of the
amount of additional retirement annuity that would be obtained
due to the purchase of additional service credit by the
individual specified in subdivision 1, using the preretirement
interest rate specified in Minnesota Statutes, section 356.215,
subdivision 4d, and the mortality table adopted for the public
employees retirement association and assuming continuous future
service in the public employees retirement association until,
and retirement at, the age at which the minimum requirements of
the retirement association for normal retirement or retirement
with an annuity unreduced for retirement at an early age,
including Minnesota Statutes, section 356.30, are met with the
additional service credit purchased, and also assuming a future
salary history that includes annual salary increases at the
salary increase rate specified in Minnesota Statutes, section
356.215, subdivision 4d.
(c) The present value of employee and employer
contributions paid to the St. Paul bureau of health relief
association by or on behalf of the individual eligible to
purchase credit under subdivision 1. The present value will be
computed assuming investment earnings on these contributions
equal to the rate actually earned by the assets of active
employees covered by the public employees retirement
association, beginning with the date the individual specified in
subdivision 1 first made contributions to the St. Paul bureau of
health relief association.
Subd. 3. [PAYMENT; CREDITING SERVICE.] Payment must be
made in one lump sum, unless the executive director of the
public employees retirement association agrees to accept payment
in installments over a period 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 may be credited to the account of the person only after
receipt of full payment by the executive director.
Subd. 4. [OPTIONAL EMPLOYER PARTIAL PAYMENT.] Payment must
be made by the person entitled to purchase prior service.
However, the city of St. Paul may, at its discretion, pay all or
any portion of the required payment amount.
Sec. 5. [EFFECTIVE DATE.]
Section 1 is effective the day after compliance with
Minnesota Statutes, section 645.021, subdivision 3, by the Thief
River Falls city council and governs actuarial valuations and
experience studies to be made under section 1 beginning with the
next actuarial valuation and experience study required after
1989.
Section 2 is effective, if approved by both the city
councils of the city of Saint Paul and the city of Minneapolis,
the day after compliance by them with Minnesota Statutes,
section 645.021, subdivision 3.
Sections 3 and 4 are effective the day following final
enactment.
ARTICLE 7
TEACHER RETIREMENT FUND PROVISIONS
Section 1. [354.095] [MEDICAL LEAVE; PAYMENT PROCEDURES.]
A member of the fund who is on an authorized medical leave
of absence and subsequently returns to teaching service, is
entitled to receive allowable service credit, not to exceed one
year, for the period of leave, upon making the prescribed
payment to the fund. This payment must include the required
employee and employer contributions at the rates specified in
section 354.42, subdivisions 2, 3, and 5, as applied to the
member's average full-time monthly salary rate on the date of
return from the leave of absence plus annual interest at the
rate of 8.5 percent per year from the midpoint date of the leave
until the date of payment. The member must pay the total amount
required unless the employing unit, at its option, pays the
employer contributions. The total amount required must be paid
before the effective date of retirement or by the end of the
fiscal year following the fiscal year in which the leave of
absence terminated, whichever is earlier. Payment must be
accompanied by a copy of the resolution or action of the
employing authority granting the leave and the employing
authority, upon granting the leave, must certify the leave to
the association on a form specified by the executive director.
A member may not receive more than one year of allowable service
credit during any fiscal year by making payment under this
section. A member may not receive disability benefits under
section 354.48 and receive allowable service credit under this
section for the same period of time.
Sec. 2. [354A.096] [MEDICAL LEAVE.]
Any teacher in the coordinated program of either the
Minneapolis teachers retirement fund association or the St. Paul
teachers retirement fund association or the new law coordinated
program of the Duluth teachers retirement fund association who
is on an authorized medical leave of absence and subsequently
returns to teaching service is entitled to receive allowable
service credit, not to exceed one year, for the period of leave,
upon making the prescribed payment to the fund. This payment
must include the required employee and employer contributions at
the rates specified in section 354A.12, subdivisions 1 and 2, as
applied to the member's average full-time monthly salary rate on
the date of return from the leave of absence plus annual
interest at the rate of 8.5 percent per year from the midpoint
date of the leave until the date of payment. The member must
pay the total amount required unless the employing unit, at its
option, pays the employer contributions. The total amount
required must be paid by the end of the fiscal year following
the fiscal year in which the leave of absence terminated or
before the member retires, whichever is earlier. Payment must
be accompanied by a copy of the resolution or action of the
employing authority granting the leave and the employing
authority, upon granting the leave, must certify the leave to
the association in a manner specified by the executive
director. A member may not receive more than one year of
allowable service credit during any fiscal year by making
payment under this section. A member may not receive disability
benefits under section 354A.36 and receive allowable service
credit under this section for the same period of time.
Sec. 3. [ST. PAUL TEACHERS RETIREMENT FUND ASSOCIATION.]
In accordance with Minnesota Statutes, section 354A.12,
subdivision 4, approval is granted for the St. Paul teachers
retirement fund association to amend its articles of
incorporation or bylaws to allow basic plan members who are
granted a medical leave of absence by independent school
district No. 625, St. Paul, to receive up to one year service
credit of that leave in accordance with the provisions of
Minnesota Statutes, section 354A.096.
Sec. 4. [DULUTH TEACHERS RETIREMENT FUND AND ST. PAUL
TEACHERS RETIREMENT FUND: ALTERNATE METHOD OF PAYING ADDITIONAL
LUMP SUM AMOUNT.]
Notwithstanding the articles or bylaws of the Duluth
teachers retirement fund association or St. Paul teachers
retirement fund association, approval is granted for the Duluth
teachers retirement fund association and St. Paul teachers
retirement fund association to provide that a lump sum
postretirement adjustment that is payable may, upon the request
of the annuitant or survivor and approval of the board of
trustees of the fund, be converted to a monthly annuity benefit
of equivalent actuarial value. The amount of the additional
annuity shall be determined by:
(1) the age of the annuitant or survivor on the date of the
lump sum postretirement adjustment;
(2) use of an annuity table of mortality established by the
board of trustees of the association as required by Minnesota
Statutes, section 356.215; and
(3) use of the postretirement interest rate assumption
specified in Minnesota Statutes, section 11A.18.
Sec. 5. [EFFECTIVE DATE.]
(a) Sections 1 to 4 are effective the day following final
enactment.
(b) Section 1 is also effective retroactively to October 9,
1988, for a former teacher employed by independent school
district No. 831 who began a long-term disability medical leave
on October 10, 1988, who terminated employment on June 16, 1989,
and who has retired. The contribution amounts for the leave
must be based on the salary rate of the teacher in effect for
the 1988-1989 school year and the contributions must be made by
June 30, 1990, with interest as calculated under section 1. If
the contribution amounts are paid, the person's retirement
annuity must be recomputed based on the resulting additional
allowable service credit and revision in the person's highest
five successive years average salary and the increased annuity
amount accrues as of the first day of the first month next
following the date of the payment. If an optional annuity form
has been selected, the increased annuity amount must be
appropriately adjusted.
ARTICLE 8
PUBLIC EMPLOYEES DEFINED CONTRIBUTION PLAN
Section 1. Minnesota Statutes 1988, section 353.01,
subdivision 7, is amended to read:
Subd. 7. [MEMBER.] A member is "Member" means a person who
accepts employment as a "public employee" and is not covered by
the plan established in chapter 353D. A person who is a member
remains a member while performing services as a public employee
and while on an authorized leave of absence or an authorized
temporary layoff; provided, however, (1) that any elected public
officer or any person appointed to fill a vacancy in an elective
office shall have the right to exercise an option to become a
member by filing application for membership, but the option to
become a member, once exercised, may not be withdrawn during the
incumbency of the person in office; and (2) that any member who
is appointed by the governor to be a state department head and
elects pursuant to section 352.021, subdivision 3, not to be
covered by the Minnesota state retirement system, shall remain a
member of the public employees retirement association.
Membership in the retirement association of any person shall
terminate upon the person ceasing to be a "public employee."
Sec. 2. Minnesota Statutes 1988, section 353D.01, is
amended to read:
353D.01 [AMBULANCE SERVICE PERSONNEL RETIREMENT PUBLIC
EMPLOYEES DEFINED CONTRIBUTION PLAN.]
Subdivision 1. [ESTABLISHMENT.] The ambulance service
personnel retirement public employees defined contribution plan
is administered by the public employees retirement association
under supervision of the association board of directors
trustees. To assist it in governing the operations of the plan,
the board may appoint an advisory committee of not more
than seven nine members who are representative of ambulance
service operators and ambulance service personnel the employers
and employees who participate in the plan.
Subd. 2. [COVERAGE ELIGIBILITY.] Coverage under Except as
provided in section 353D.11, eligibility to participate in the
retirement plan is open to an elected local government official
of a governmental subdivision who elects to participate in the
plan who is not a member of the public employees retirement
association within the meaning of section 353.01, subdivision 7,
and to basic and advanced life support emergency medical service
personnel employed by or providing services for any public
ambulance service or privately operated ambulance service that
receives an operating subsidy from a governmental entity that
elects to participate. For purposes of this chapter, an elected
local government official includes a person appointed to fill a
vacancy in an elective office. Elected local government
official does not include an elected county sheriff. Except as
provided in section 353D.11, elected local government officials
and first response personnel and emergency medical service
personnel who are currently covered by a public or private
pension plan because of their employment or provision of
services are not eligible to participate in the plan.
Sec. 3. Minnesota Statutes 1988, section 353D.02, is
amended to read:
353D.02 [ELECTION OF COVERAGE.]
Eligible elected local government officials may elect to
participate in the plan after being elected or appointed to a
public office by filing an application to participate on a form
prescribed by the executive director of the association.
Participation begins on the first day of the month after the
application is received in the association's office or on the
date when the term of office commences, whichever date is
later. An election to participate in the plan is irrevocable
during incumbency in office.
Each public ambulance service or privately operated
ambulance service that receives an operating subsidy from a
governmental entity with eligible personnel may elect to
participate in the plan. If a service elects to participate,
its eligible personnel may elect to participate or to decline to
participate. An individual's election must be made within the
latter of 30 days of the service's election to participate or 30
days of the date on which the individual was employed by the
service or began to provide service for it, whichever date is
later. An election by a service or an individual is irrevocable.
Sec. 4. Minnesota Statutes 1988, section 353D.03, is
amended to read:
353D.03 [FUNDING OF PLAN.]
(a) An eligible elected local government official who
elects to participate in the public employees defined
contribution plan shall contribute an amount equal to five
percent of salary as defined in section 353.01, subdivision 10.
A participating elected local government official's governmental
subdivision shall contribute a matching amount.
(b) A public ambulance service or privately operated
ambulance service that receives an operating subsidy from a
governmental entity that elects to participate in the plan shall
fund benefits for its qualified personnel who individually elect
to participate, except that personnel who are paid for their
services may elect to make member contributions in an amount not
to exceed the service's contribution on their behalf. Ambulance
service contributions on behalf of salaried employees must be a
fixed percentage of salary. An ambulance service making
contributions for volunteer or largely uncompensated personnel
may assign a unit value for each call or each period of alert
duty for the purpose of calculating ambulance service
contributions.
Sec. 5. Minnesota Statutes 1988, section 353D.04, is
amended to read:
353D.04 [CONTRIBUTIONS TO PLAN.]
(a) Contributions made by or on behalf of a participating
elected local government official must be remitted to the public
employees retirement association at least monthly and must be
credited to the individual account established for the
participating officer.
(b) Ambulance service contributions to the plan may be made
from any source of funds available to the ambulance service.
Contributions must be remitted monthly on a regular periodic
basis to the association together with any member contributions
paid or withheld during the preceding month. Those
contributions shall must be credited to the individual account
of each participating member.
Sec. 6. Minnesota Statutes 1988, section 353D.05,
subdivision 1, is amended to read:
Subdivision 1. [INVESTMENT.] Ambulance service Employing
unit contributions, after the deduction of an amount for
administrative expenses, and member individual participant
contributions must be remitted to the state board of investment
for investment in the Minnesota supplemental investment fund
established by section 11A.17.
Sec. 7. Minnesota Statutes 1988, section 353D.05,
subdivision 3, is amended to read:
Subd. 3. [ADMINISTRATIVE EXPENSES.] The public employees
retirement association may deduct an amount, set annually by the
executive director of the association, but not to exceed two
percent of ambulance service the employing unit contributions to
the plan, to defray the expenses of the association in
administering the plan.
Sec. 8. Minnesota Statutes 1988, section 353D.06, is
amended to read:
353D.06 [REPORTING BY AMBULANCE SERVICES.]
The executive director of the public employees retirement
association shall prescribe the form of monthly and any other
reports reporting forms required from an ambulance service
employing units and the election forms required from ambulance
service members participants. Member Reporting forms
shall must contain names, identification numbers, amount of
contribution by and on behalf of each member participant, and
such other data as is required to keep an accurate account
record of the account value of each participating employee
participant.
Sec. 9. Minnesota Statutes 1988, section 353D.07, is
amended to read:
353D.07 [BENEFITS.]
Subdivision 1. [TYPE OF PLAN; UNIFORMITY.] (a) The plan is
a defined contribution plan when the benefits from which are
payable upon termination of service, retirement, disability, or
death. The amount of benefits is determined by the value of
accumulated contributions plus a proportionate share of
investment income of the fund credited to each individual
account. Each ambulance service shall determine eligibility for
participation subject to terms of Laws 1987, chapter 372.
(b) In the case of ambulance service personnel, eligibility
standards must be uniform among all ambulance service personnel
of an ambulance service electing to participate.
Subd. 2. [PAYMENT OF BENEFITS.] Withdrawal of or a
retirement benefit based on member individual participant
contributions and employer contributions plus accrued investment
income is payable immediately upon the death or termination
of an active member a participant for a period that exceeds 30
days. An application by or on behalf of the participant must be
filed before any payment of benefits may be made.
Subd. 3. [FORM OF BENEFIT.] A retirement benefit is
payable in a lump sum equal to the value of a participant's
account at the date of retirement and may be rolled over into
another qualified plan at the option of the member participant.
As an alternative to a lump sum distribution, the member
participant may choose to have the association use the total
account value to purchase an annuity payable at a designated age
from an insurance company licensed to do business in the state.
Subd. 4. [DISABILITY OF PARTICIPANT.] If an active
participant becomes permanently and totally disabled as defined
in section 353.01, subdivision 19, that participant may withdraw
from the account in equal monthly installments an amount,
designated by the participant in increments of $100 but not to
exceed ten times the joint employer and employee contribution
for the month preceding disability. The option must be
exercised by filing an application on a form prescribed by the
executive director. Payments begin on the first day of the
month following the month in which the disability occurred.
Payments end when the participant's disabled status ends or the
account balance is exhausted, whichever occurs first.
Subd. 5. [DEATH OF A MEMBER PARTICIPANT.] In the event of
the death of If an active participant dies, the total value of
the account must be paid in a lump sum to the designated
beneficiary or, if none, the heirs at law of the decedent.
Sec. 10. Minnesota Statutes 1988, section 353D.08, is
amended to read:
353D.08 [PORTABILITY.]
Qualified Participating ambulance service personnel who
change employment or membership among participating ambulance
services must shall continue participation in the plan if
termination from one participating ambulance service and
commencement in another participating ambulance service occur
occurs within 30 days.
Sec. 11. Minnesota Statutes 1988, section 353D.09, is
amended to read:
353D.09 [TAX QUALIFICATION.]
The public employees retirement association shall adopt
rules required necessary for administration of the plan. The
proposed plan shall be formulated and adopted in accordance with
applicable restrictions and standards of the Internal Revenue
Code and rulings and regulations of the Internal Revenue Service
in order to assure the tax exempt status of the plan as a
qualified pension plan. Contributions by ambulance service
personnel and by ambulance service operators may be accepted
only after approval by the Internal Revenue Service.
Sec. 12. [353D.11] [CURRENT ELECTED PUBLIC OFFICERS.]
Subdivision 1. [EXERCISE OF OPTION.] As of July 1, 1990,
an elected local government official, who with respect to
elected service is participating in, and covered by, the general
employees defined benefit plan administered by the public
employees retirement association under chapter 353, may elect to
participate in the public employees defined contribution plan
and terminate further participation in, and coverage under, the
defined benefit plan. The necessary election must be made
before June 30, 1991.
Subd. 2. [REFUND OR DEFERRED ANNUITY.] An elected public
officer who, with respect to elected service is participating
in, and covered by, the general employees defined benefit plan
administered by the public employees retirement association
under chapter 353 and who, with respect to future elected
service, elects to participate in the public employees defined
contribution plan, is deemed to have terminated public service
for purposes of the return of the accumulated employee
deductions with interest or the deferred annuity allowed under
section 353.34. The termination of public service is deemed to
occur as of the first day of the month following the month in
which the election is made to participate in the public
employees defined contribution plan and any refund of
accumulated employee deductions with interest or future deferred
annuity is governed by the law in effect on that day.
Sec. 13. [353D.12] [CONTRIBUTIONS FOR PREVIOUS SERVICE.]
Subdivision 1. [ELIGIBILITY; CONTRIBUTIONS.] An elected
local government official who participates in the defined
contribution plan under this chapter may make contributions to
the plan for the service as an elected public officer rendered
before the effective date of this section that was not covered
by a public or private employer contributory pension plan,
including a plan administered by the public employees retirement
association under chapter 353.
Subd. 2. [AMOUNT OF PRIOR SERVICE CONTRIBUTIONS.] (a) The
employee purchase amount is that amount that the participating
elected local government official specifies, but combined with
subdivision 6 may not exceed in total the amount of the employee
and employer contributions that would have been payable under
section 353.27, subdivisions 2, 3, and 3a, based on the actual
salary or compensation of the elected local government official
from public sources during the prior service and based on the
rates in effect during the prior service, plus interest at an
annual compound rate of six percent.
(b) In any year, the purchase amount to be paid in is
subject to the limitation for defined contribution plans under
section 415(c) of the federal Internal Revenue Code, as amended,
or comparable contribution limitation set forth in the federal
Internal Revenue Code, and applicable regulations and revenue
rulings, remaining after subtracting the funding amounts under
section 353D.03, paragraph (a), for that year.
Subd. 3. [INSTALLMENT PAYMENTS.] The purchase amount may
be made in annual installments but may not exceed, combined with
subdivision 6, in any installment the limitation set forth in
subdivision 2, paragraph (a), or in total the limitation set
forth in subdivision 2, paragraph (a).
Subd. 4. [AUTHORIZED ROLLOVERS.] To the extent allowed by
federal law, the employee purchase amount may be made with funds
distributed from: (1) a plan qualified under section 401(a) of
the federal Internal Revenue Code, as amended; (2) an annuity
qualified under section 403(a) of the federal Internal Revenue
Code, as amended; (3) an individual retirement account used
solely to receive a nontaxable rollover from that type of plan
or annuity; (4) the state deferred compensation plan authorized
under section 352.96 and qualified under section 457 of the
federal Internal Revenue Code, as amended; or (5) another tax
qualified plan or annuity that authorizes rollovers. The
participating elected local government official shall supply
sufficient written documentation that the transfer amounts are
eligible for tax-free rollover treatment. An authorized
tax-free rollover, plus any other purchase amount payments under
this section, including subdivision 6, may not exceed the
limitation in subdivision 2, paragraph (a). Notwithstanding any
provision of state law or rule to the contrary, to the extent
permitted under federal law, the employee purchase amount may be
transferred from the state deferred compensation plan before the
employee terminates public employment.
Subd. 5. [PRIOR SERVICE AND COMPENSATION
DOCUMENTATION.] The participating elected local government
official shall supply sufficient documentation of the person's
prior uncredited service and compensation for which the purchase
payment is made.
Subd. 6. [EMPLOYING UNIT PAYMENT.] The employing unit of
the participating elected local government official shall pay
the amount of the employer contributions that could have been
payable under section 353.27, subdivisions 3 and 3a, based on
the actual salary or compensation of the elected local
government official from public sources during the prior
service, plus interest at an annual compound rate of six
percent. This amount combined with any employee purchase amount
and any contributions under section 353D.03, paragraph (a), must
in any year comply with the limitation set forth in subdivision
2, paragraph (a).
Sec. 14. [PURCHASE OF PRIOR SERVICE CREDIT.]
Subdivision 1. [ENTITLEMENT.] An elected public officer
who participates in the public employees retirement association
defined benefit plan under Minnesota Statutes, chapter 353, may
purchase service credit from the association for all or any
portion of prior uncredited service as an elected public officer
when the officer could have been, but was not, a member of the
association on account of failure to exercise the membership
option under Minnesota Statutes, section 353.01, subdivision 7.
Subd. 2. [PURCHASE PAYMENT AMOUNT.] To purchase credit for
prior service under subdivision 1, there must be paid to the
public employee retirement association an amount equal to the
present value, on the date of payment, of the amount of the
additional retirement annuity obtained by the purchase of the
additional service credit. Calculation of this amount must be
made using the applicable preretirement interest rate for the
association specified in Minnesota Statutes, section 356.215,
subdivision 4d, and the mortality table adopted for the
association. The calculation must assume continuous future
service in the association until, and retirement at, the age at
which the minimum requirements of the association for normal
retirement or retirement with an annuity unreduced for
retirement at an early age, including Minnesota Statutes,
section 356.30, are met with the additional service credit
purchased. The calculation must also assume a future salary
history that includes annual salary increases at the applicable
salary increase rate for the association specified in section
356.215, subdivision 4d. The member must establish in the
records of the association proof of the service for which the
purchase of prior service is requested. The manner of the proof
of service must be in accordance with procedures prescribed by
the executive director of the association.
Subd. 3. [PAYMENT; CREDITING SERVICE.] Payment may be made
in one lump sum, or in annual increments over a period not to
exceed five years from the effective date of this section. If
payments are made in increments, the period of allowable service
purchased by each payment is credited to the account of the
member upon receipt of each payment by the executive director.
If payments are made in increments, the executive director must
calculate the present value of the amount of the additional
retirement annuity obtained by each incremental payment.
Subd. 4. [OPTIONAL EMPLOYER PARTIAL PAYMENT.] Payment of
the amount calculated under subdivision 2 must be made by the
member. However, the current or former governmental subdivision
employer of the member may, at its discretion, pay all or any
portion of the payment amount that exceeds an amount equal to
the employee contribution rates in effect during the period or
periods of prior service applied to the actual salary rates in
effect during the period or periods of prior service, plus
interest at the rate of six percent a year compounded annually
from the date on which the contributions would otherwise have
been made to the date on which the payment is made.
Sec. 15. [EFFECTIVE DATE.]
Sections 1 to 14 are effective on the day following final
enactment.
ARTICLE 9
TRANSFERS TO MINNESOTA POSTRETIREMENT
INVESTMENT FUND
Section 1. Minnesota Statutes 1988, 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 last business day of the
month in which the benefit payment from the postretirement
investment fund begins to accrue, certify and transfer to the
state board money equal to the 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 on the required transfer
date, the initial transfer must be based on the best estimate by
the executive director of for the teachers retirement fund
involved and shall be made on a timely basis and the public
employees retirement fund and may be based on the best estimate
for the other participating funds. 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. 2. [EFFECTIVE DATE.]
Section 1 is effective the day following final enactment.
ARTICLE 10
MINNESOTA STATE RETIREMENT SYSTEM
ADMINISTRATIVE PROVISIONS
Section 1. Minnesota Statutes 1988, section 352.01,
subdivision 13, is amended to read:
Subd. 13. [SALARY.] "Salary" means any the periodical
compensation paid to any employee including wages, allowances,
and fees, but excluding amounts of severance pay. before
deductions for deferred compensation, supplemental retirement
plans, or other voluntary salary reduction programs. It also
means wages and includes net income from fees. Lump sum sick
leave payments, severance payments, and all payments in lieu of
any employer-paid group insurance coverage, including the
difference between single and family rates that may be paid to
an employee with single coverage, are not deemed to be salary.
Workers' compensation payments are not considered salary.
Sec. 2. Minnesota Statutes 1989 Supplement, section
352.021, subdivision 5, is amended to read:
Subd. 5. [CONTINUING COVERAGE.] Any state employee who has
made contributions to the retirement fund for a period of one
year and who, continuing in state service after that year,
becomes eligible for membership in the state teachers retirement
association as a full-time teacher, as defined in section
354.05, subdivision 2, or is covered by section 354.05,
subdivision 2a, may continue coverage under the system by filing
in its office written notice of election to continue. The
election to be covered by the system under this subdivision or
section 352.01, subdivision 2b, clause (3), must be made on a
form approved by the director within 90 days after appointment
to the position. If the option is exercised, the employee is
not thereafter entitled to membership in the teachers retirement
association or in the individual retirement account plan for
community college and state university faculty while employed by
the state in a position that entitled the employee to make this
election.
Sec. 3. Minnesota Statutes 1988, section 352.029,
subdivision 3, is amended to read:
Subd. 3. [CONTRIBUTIONS.] The employee, employer, and
additional employer contributions required by section 352.04, or
by section 352.92 for employees covered by section 352.91, are
the obligation of the employee who chooses coverage under this
section. However, the employing labor organization may pay the
employer and employer additional contributions. Contributions
made by the employee must be made by salary deduction. The
employing labor organization shall pay all contributions to the
system as required by section 352.04, or by section 352.92 for
employees covered by section 352.91.
Sec. 4. Minnesota Statutes 1988, section 352.03,
subdivision 1, is amended to read:
Subdivision 1. [MEMBERSHIP OF BOARD; ELECTION; TERM.] The
policy-making function of the system is vested in a board of 11
members, who shall must be known as the board of directors.
This board shall consist of three members appointed by the
governor, one of whom must be a constitutional officer or
appointed state official and two of whom must be public members
knowledgeable in pension matters, four state employees elected
by state employees covered by the system excluding employees in
categories specifically authorized to designate or elect a
member by this subdivision, one employee of the transit
operating division of the metropolitan transit commission
designated by the executive committee of the labor organization
that is the exclusive bargaining agent representing employees of
the transit division, one member of the state patrol retirement
fund elected by members of that fund at a time and in a manner
fixed by the board, one employee covered by the correctional
employees plan elected by employees covered by that plan, and
one retired employee elected by disabled and retired employees
of all plans administered by the system at a time and in a
manner to be fixed by the board. Two state employee members,
whose terms of office begin on the first Monday in March May
after their election, must be elected biennially. Elected
members and the appointed transit operating division member hold
office for a term of four years, except the retired member whose
term is two years, and until their successors are elected or
appointed, and have qualified. An employee of the system is not
eligible for membership on the board of directors. A state
employee on leave of absence is not eligible for election or
reelection to membership on the board of directors. The term of
any board member who is on leave for more than six months
automatically ends on expiration of this period.
Sec. 5. Minnesota Statutes 1988, section 352.115,
subdivision 7, is amended to read:
Subd. 7. [APPLICATION FOR ANNUITY.] Application for
annuity or optional annuity payment may be made by the employee
at time of retirement, or by someone acting in behalf of the
employee, upon proof of authority satisfactory to the director.
Sec. 6. Minnesota Statutes 1988, section 352.96,
subdivision 4, is amended to read:
Subd. 4. [EXECUTIVE DIRECTOR TO ESTABLISH RULES.] The
executive director of the system shall establish rules and
procedures to carry out this section including allocation of
administrative costs against the assets accumulated under this
section. Funds to pay these costs are appropriated from the
fund or account in which the assets accumulated under this
section are placed. The rules established by the executive
director must conform to federal and state tax laws,
regulations, and rulings, and are not subject to the
administrative procedure act. Except for the marketing rules,
rules adopted after July 1, 1977, relating to the options
provided under subdivision 2, clauses (2) and (3), must be
approved by the state board of investment. A state employee
must not make payments under a plan until the plan or applicable
component of the plan has been approved for tax-deferred status
by the internal revenue service.
Sec. 7. [EFFECTIVE DATE.]
Sections 1 to 6 are effective the day following final
enactment.
ARTICLE 11
PUBLIC EMPLOYEES RETIREMENT ASSOCIATION
ADMINISTRATIVE PROVISIONS
Section 1. Minnesota Statutes 1989 Supplement, section
353.01, subdivision 2b, is amended to read:
Subd. 2b. [EXCLUDED EMPLOYEES.] The following persons are
excluded from the meaning of "public employee":
(1) persons who are employed for professional services
where the service is incidental to regular professional duties,
determined on the basis that compensation for the service
amounts to no more than 25 percent of the person's total annual
gross earnings for all professional duties;
(2) election officers;
(3) independent contractors and their employees;
(4) patient and inmate personnel who perform services in
charitable, penal, or correctional institutions of a
governmental subdivision;
(5) members of boards, and commissions, bands, and others
who serve a governmental subdivision intermittently unless their
position on the board or commission is the result of public
employment within the same governmental unit;
(6) employees whose employment is not expected to continue
for a period longer than six consecutive months, unless it
involves employment for a probationary period that is part of a
permanent position who are hired for a period of less than six
consecutive months but not those employees who are hired for an
unlimited period but are serving a probationary
period. Immediately following the expiration of a six-month
period of employment, If the period of employment is extended
beyond the six-month period and the employee continues in public
service and earns more than $425 from one governmental
subdivision in any one calendar month, the department head shall
report the employee for membership and require employee
deductions be made on behalf of the employee in accordance with
section 353.27, subdivision 4. Membership eligibility of an
employee who holds concurrent temporary employment of six months
or less and part-time nontemporary positions in one governmental
subdivision must be determined by the salary of each position.
Membership eligibility of an employee who holds nontemporary
positions in one governmental subdivision must be determined by
the total salary of all positions;
(7) part-time appointed and elected employees who receive
monthly whose actual compensation from one governmental
subdivision does not exceeding exceed $425 per month, and
part-time employees and elected officials or whose annual
compensation from one governmental subdivision is stipulated in
advance, in writing, to be not more than $5,100 per calendar
year or per school year for school employees for employment
expected to be of a full year's duration or more than the
prorated portion of $5,100 per employment period for employment
expected to be of less than a full year's duration, except that
members continue their membership until termination of public
service as defined in subdivision 11a. Membership eligibility
of an employee who holds concurrent part-time positions under
this clause must be determined by the total salary of all such
positions in one governmental subdivision. If compensation from
one governmental subdivision to an employee under this paragraph
exceeds $5,100 per calendar year or school year after being
stipulated in advance not to exceed that amount, the stipulation
is no longer valid and contributions must be made on behalf of
the employee in accordance with section 353.27, subdivision 12,
from the month in which the employee's earnings first exceeded
$425;
(8) persons who first occupy an elected office after July
1, 1988, the compensation for which does not exceed $425 per
month;
(9) emergency employees who are employed by reason of work
caused by fire, flood, storm, or similar disaster;
(10) employees who by virtue of their employment in one
governmental subdivision are required by law to be a member of
and to contribute to any of the plans or funds administered by
the Minnesota state retirement system, the teachers retirement
association, the Duluth teachers retirement fund association,
the Minneapolis teachers retirement association, the St. Paul
teachers retirement fund association, the Minneapolis employees
retirement fund, or any police or firefighters relief
association governed by section 69.77 that has not consolidated
with the public employees police and fire fund, or any police or
firefighters relief association that has consolidated with the
public employees retirement association but whose members have
not elected coverage by the public employees police and fire
fund as provided in sections 353A.01 to 353A.10. This clause
must not be construed to prevent a person from being a member of
and contributing to the public employees retirement association
and also belonging to and contributing to another public pension
fund for other service occurring during the same period of
time. A person who meets the definition of "public employee" in
subdivision 2 by virtue of other service occurring during the
same period of time shall become a member of the association
unless contributions are made to another public retirement fund
on the salary based on the other service or to the teachers
retirement association by a teacher as defined in section
354.05, subdivision 2;
(11) police matrons who are employed in a police department
of a city who are transferred to the jurisdiction of a joint
city and county detention and corrections authority;
(12) persons who are excluded from coverage under the
federal old age, survivors, disability, and health insurance
program for the performance of service as specified in United
States Code, title 42, section 410(a)(8)(A), as amended through
January 1, 1987;
(13) full-time students who are enrolled and are regularly
attending classes at an accredited school, college, or
university and who are not employed full time by a governmental
subdivision;
(14) resident physicians, medical interns, and pharmacist
residents and interns who are serving in a degree or residency
program in public hospitals and students who are serving in an
internship or residency program sponsored by an accredited
educational institution;
(15) appointed or elected officers who are paid entirely on
a fee basis and who were not members on June 30, 1971;
(16) persons who hold a part-time adult supplementary
technical institute license who render part-time teaching
service in a technical institute;
(17) persons exempt from licensure under section 125.031;
(18) persons employed by the Minneapolis community
development agency;
(19) except as provided in section 353.86, volunteer
ambulance service personnel, as defined in subdivision 35, but
persons who serve as volunteer ambulance service personnel may
still qualify as public employees under subdivision 2 and may be
members of the public employees retirement association and
participants in the public employees retirement fund or the
public employees police and fire fund on the basis of
compensation received from public employment service other than
service as volunteer ambulance service personnel; and
(20) except as provided in section 353.87, volunteer
firefighters, as defined in subdivision 36, engaging in
activities undertaken as part of volunteer firefighter duties;
provided that a person who is a volunteer firefighter may still
qualify as a public employee under subdivision 2 and may be a
member of the public employees retirement association and a
participant in the public employees retirement fund or the
public employees police and fire fund on the basis of
compensation received from public employment activities other
than those as a volunteer firefighter.
Sec. 2. Minnesota Statutes 1989 Supplement, section
353.01, subdivision 11a, is amended to read:
Subd. 11a. [TERMINATION OF PUBLIC SERVICE.] "Termination
of public service" occurs when an officer or employee who
terminates employment but or is on temporary layoff as defined
in subdivision 12 and does not within 30 days returns of
termination or expiration of the temporary layoff return
to nontemporary employment in the same governmental subdivision
or begins employment in another position otherwise excluded from
membership is considered a member from the beginning of the
reemployment unless the total period covered by all periods of
employment is less than six months or the amount earned does not
exceed the dollar limitations in subdivision 2b, clause (7).
Sec. 3. Minnesota Statutes 1988, section 353.01,
subdivision 16, is amended to read:
Subd. 16. [ALLOWABLE SERVICE.] (a) "Allowable service"
means service during years of actual membership in the course of
which employee contributions were made, periods covered by
payments in lieu of salary deductions made as provided in
section 353.35, and service in years during which the public
employee was not a member but for which the member later
elected, while a member, to obtain credit by making payments to
the fund as permitted by any law then in effect.
(b) "Allowable service" also means a period of authorized
leave of absence with pay from which deductions for employee
contributions are made, deposited, and credited to the fund.
(c) "Allowable service" also means a period of authorized
leave of absence without pay that does not exceed one year, and
during or for which a member obtained credit by payments to the
fund made in place of salary deductions, provided that the
payments are made in an amount or amounts based on the member's
average salary on which deductions were paid for the last six
months of public service, or for that portion of the last six
months while the member was in public service, to apply to the
period in either case immediately preceding commencement of the
leave of absence; provided, however, that if the employee elects
to pay employee contributions for the period of any leave of
absence without pay, or for any portion of the leave, the
employee shall also, as a condition to the exercise of the
election, pay to the fund an amount equivalent to both the
required employer and additional employer contributions for the
employee. The payment must be made within one year from the
date the leave of absence terminates. The employer by
appropriate action of its governing body, made a part of its
official records, before the date of the first payment of the
employee contribution, may certify to the association in writing
that it will cause to be paid the employer and additional
employer contributions from the proceeds of a tax levy made
under section 353.28. Payments under this paragraph must
include interest at the rate of six percent a year from the date
of the termination of the leave of absence to the date payment
is made.
(d) "Allowable service" also means a period during which a
member is on an authorized sick leave of absence, without pay
limited to one year, or an authorized temporary layoff, or a
maternity leave. The association will grant a maximum of two
months service credit for a maternity leave upon documentation
from the member's governmental subdivision. A member on
personal leave of absence who provides the association with a
birth certificate or other evidence of birth during the personal
leave time period will be granted up to two months of service
credit.
(e) "Allowable service" also means a period during which a
member is on an authorized leave of absence to enter military
service, provided that the member returns to public service upon
discharge from military service under section 192.262 and pays
into the fund employee contributions based upon the employee's
salary at the date of return from military service. Payment
must be made within five years of the date of discharge from the
military service. The amount of these contributions must be in
accord with the contribution rates and salary limitations, if
any, in effect during the leave, plus interest at six percent a
year compounded annually from the date of return to public
service to the date payment is made. In such cases the matching
employer contribution and additional employer contribution
provided in section 353.27, subdivisions 3 and 3a, must be paid
by the department employing the member upon return to public
service, and the governmental subdivision involved may
appropriate money for those payments. A member may not receive
credit for a voluntary extension of military service at the
instance of the member beyond the initial period of enlistment,
induction, or call to active duty.
(f) For calculating benefits under sections 353.30, 353.31,
353.32, and 353.33 for state officers and employees displaced by
the community corrections act, chapter 401, and transferred into
county service under section 401.04, "allowable service" means
combined years of allowable service as defined in paragraphs (a)
to (e) and section 352.01, subdivision 11.
(g) For a public employee who has prior service covered by
a local police or firefighters relief association that has
consolidated with the public employees police and fire fund, and
who has elected coverage by the public employees police and fire
fund benefit plan as provided in section 353A.08 following the
consolidation, "applicable service" is a period of service
credited by the local police or firefighters relief association
as of the effective date of the consolidation based on law and
on bylaw provisions governing the relief association on the date
of the initiation of the consolidation procedure.
Sec. 4. Minnesota Statutes 1988, section 353.15,
subdivision 2, is amended to read:
Subd. 2. [AUTOMATIC DEPOSITS.] The association may pay an
annuity, benefit or refund to a trust company, qualified under
chapter 48, that is trustee for a person eligible to receive
such annuity, benefit or refund. Upon the request of a retired,
disabled or former member, the association may mail or send by
electronic transfer the annuity, benefit or refund check to a
banking institution, savings association or credit union for
deposit to such person's account or joint account with a
spouse. The association may prescribe the conditions under
which such payment will be made.
Sec. 5. Minnesota Statutes 1988, section 353.27,
subdivision 7, is amended to read:
Subd. 7. [ADJUSTMENT FOR ERRONEOUS RECEIPTS OR
DISBURSEMENTS.] (a) [ERRONEOUS DEDUCTIONS.] Deductions taken in
error by the employer from the salary of an employee for the
retirement fund and transmitted to the association must be
refunded to the employee calculated in accordance with section
353.34, subdivision 2; and the employer contribution and the
additional employer contribution, if any, for the erroneous
employee contribution must be refunded to the employer,
provided, however, that the association and the state social
security agency may make proper adjustments of money taken as
employee and employer deductions, and provided further that the
refund of deductions taken in error has been made within three
calendar years of the calendar year in which the initial
erroneous deduction taken in error was received by the
association, except for erroneous deductions of sick leave,
vacation pay, and severance pay, which may be made at any time.
If the refund of deductions taken in error has not been made
within three calendar years of the calendar year in which the
initial erroneous deduction taken in error was received by the
association, the erroneous contributions are considered valid,
and the years of allowable service attributable to the erroneous
deductions must be credited to the member in accordance with
section 353.01, subdivision 16, and, notwithstanding a law to
the contrary, the employee may continue to be a member until
termination of public service.
(b) [ERRONEOUS DISBURSEMENT.] In the event a salary
warrant or check from which a deduction for the retirement fund
was taken has been canceled or the amount of the warrant or
check returned to the funds of the department making the
payment, a refund of the sum deducted, or a portion of it that
is required to adjust the deductions, must be made to the
department or institution.
Sec. 6. Minnesota Statutes 1988, section 353.27,
subdivision 10, is amended to read:
Subd. 10. [EMPLOYERS; FURNISH COPIES OF PAYROLL
ABSTRACTS.] The head of each department is required to furnish
the executive director with a carbon or duplicate copy of the
departmental payroll abstracts for the last full pay period
during the month of May for school districts and December the
last pay period covering calendar-year earnings for all other
governmental subdivisions, respectively, in each year. Instead
of a duplicate copy of the payroll abstract, the employer may
submit an exception report listing only those employees who
worked the last full pay period of May or December, but who are
not members of the association. Minimum reporting requirements
to be shown on either the payroll abstract or exception report
include: (1) name of the governmental subdivision and
department identification; (2) the association's assigned unit
number and unique code; (3) pay period coverage dates; (4) any
employee deductions; (5) gross salary for the pay period; (6)
each employee's year-to-date gross pay; and (7) the reason for
any exclusion. The executive director shall check the copies of
all payroll abstracts against the membership records of the
association to ascertain whether any omissions have been made by
a department head in the reporting of new public employees for
membership. The head of any department shall furnish a carbon
or duplicate copy of the department payroll abstract at the
request of the executive director. The executive director may
delegate an association employee by appointment, in accordance
with section 353.03, subdivision 3a, paragraph (b), clause (5),
to conduct a field audit to review the payroll records of a
governmental subdivision.
Sec. 7. Minnesota Statutes 1989 Supplement, section
353.35, is amended to read:
353.35 [CONSEQUENCES OF REFUND; REPAYMENT, RIGHTS
RESTORED.]
When any former member accepts a refund, all existing
service credits and all rights and benefits to which the person
was entitled prior to the acceptance of the refund shall must
terminate and shall must not again be restored until the person
acquires not less than at least 18 months allowable service
credit after taking the last refund and repays all refunds taken
and interest received under section 353.34, subdivisions 1 and
2, plus interest at six percent per annum compounded annually.
If more than one refund has been taken, the person may repay all
refunds or only the refund for the fund in which the person had
most recently been a member, with interest at six percent per
annum compounded annually. All refunds must be repaid
within three six months of the last date of termination of
public service.
Sec. 8. Minnesota Statutes 1988, section 353.46,
subdivision 4, is amended to read:
Subd. 4. Except as provided in section 353.84, the rights
of a survivor of a former member, where such former member died
prior to June 30, 1973, shall must be determined by the law in
effect when such former member died even though a benefit is not
payable until after June 30, 1973. If the survivor is also
eligible to receive a retirement annuity from the association,
the survivor is eligible to receive both benefits.
Sec. 9. Minnesota Statutes 1989 Supplement, section
353.656, subdivision 1, is amended to read:
Subdivision 1. [IN LINE OF DUTY; COMPUTATION OF BENEFITS.]
Any member of the police and fire fund less than 55 years of
age, who shall become becomes disabled and physically unfit to
perform duties as a police officer or firefighter subsequent to
June 30, 1973, as a direct result of an injury, sickness, or
other disability incurred in or arising out of any act of duty,
which shall has or is expected to render the member physically
or mentally unable to perform duties as a police officer or
firefighter for a period of at least one year, shall receive
disability benefits during the period of such disability. The
benefits shall must be in an amount equal to 50 percent of the
"average salary" pursuant to subdivision 3 plus an additional
2-1/2 percent of said average salary for each year of service in
excess of 20 years. Should disability under this subdivision
occur before the member has at least five years of allowable
service credit in the police and fire fund, the disability
benefit shall must be computed on the "average salary" from
which deductions were made for contribution to the police and
fire fund.
Sec. 10. Minnesota Statutes 1989 Supplement, section
353.656, subdivision 3, is amended to read:
Subd. 3. [NONDUTY DISABILITY BENEFIT.] Any member who
becomes disabled after not less than one year of allowable
service, before reaching the age of 55, because of sickness or
injury occurring while not on duty as a police officer or
firefighter, and by reason of that sickness or injury the member
has been or is expected to be unable to perform duties as a
police officer or firefighter for a period of at least one year,
shall be is entitled to receive a disability benefit. The
benefit shall must be in the same amount and paid in the same
manner as if the member were 55 years of age at the date of
disability and the benefit were paid pursuant to under section
353.651. If a disability under this subdivision occurs after
one but in less than 15 years of allowable service, the
disability benefit shall must be the same as though the member
had at least 15 years service. For any a member who is employed
as a full-time firefighter by the department of military affairs
of the state of Minnesota, allowable service as a full-time
state military affairs department firefighter credited by the
Minnesota state retirement system may be used in meeting the
minimum allowable service requirement of this subdivision.
Sec. 11. Minnesota Statutes 1988, section 353.657,
subdivision 1, is amended to read:
Subdivision 1. In the event any member of the police and
fire fund shall die dies from any cause before retirement or
after becoming disabled and receiving disability benefits if no
optional annuity form was elected under section 353.656,
subdivision 1a, the association shall grant survivor benefits to
any a surviving spouse who had the same legal residence as the
member at the time of death and who was married to the member
for a period of at least one year, except that if death occurs
in the line of duty no time limit is required, and to a
dependent child or children, unmarried and under the age of 18
years. The spouse and child or children shall be are entitled
to monthly benefits as provided in the following subdivisions.
Sec. 12. Minnesota Statutes 1988, section 353.83, is
amended to read:
353.83 [ADDITIONAL PAYMENTS TO CERTAIN ANNUITANTS.]
Payments of retirement annuities pursuant to this chapter,
to annuitants who (a) retired prior to July 1, 1962, (b) had at
least 20 years of allowable service credit in the public
employees retirement association upon their termination of
public employment, and (c) receive annuities of less than $200
per month shall must, retroactive to July 1, 1967, be
supplemented by additional payments by of $15 per month from the
public employees retirement association from moneys in the
general fund of the state of Minnesota in the amount of $15 per
month, provided that such, if the annuitants have not previously
qualified for the additional payments pursuant to under this
section, and provided further that in no case shall the
annuities plus the additional payments do not exceed $200 per
month. These additional payments shall must be made in the same
manner and at the same time retirement annuities are paid
and shall must be included in the warrants on which the
annuities are so paid. The supplemental payment herein provided
shall be excluded from additional payments are to be added to
and considered a portion of the annuity otherwise payable to the
recipient and must be included in the computation of any monthly
survivor benefit or optional annuity which may become due and
payable to any person following the death of an annuitant who,
during life, received a benefit pursuant to under this section.
If an annuitant entitled to receive additional payment under
this section should die dies before such retroactive payment is
received, payment shall must be made upon demand to the
designated beneficiary in an amount equal to the accumulated
benefit from July 1, 1967, to the date of death, without
interest.
Sec. 13. [REPEALER.]
Minnesota Statutes 1989 Supplement, section 353.87,
subdivision 5, is repealed.
Sec. 14. [EFFECTIVE DATE.]
Sections 1 to 13 are effective the day following final
enactment.
ARTICLE 12
TECHNICAL CORRECTIONS
Section 1. Minnesota Statutes 1988, section 3A.03,
subdivision 2, is amended to read:
Subd. 2. [REFUND.] (1) Any person who has made
contributions pursuant to subdivision 1 who is no longer a
member of the legislature is entitled to receive upon
application to the director a refund of all contributions
credited to the member's account with interest at the rate of
five six percent per annum compounded annually.
(2) The refund of contributions as provided in clause (1)
above terminates all rights of a former member of the
legislature or survivors of the former member under this
chapter. Should the former member of the legislature again be a
member of the legislature after having taken a refund as
provided above, the member shall be considered a new member.
However, a new member may reinstate the rights and credit for
service forfeited, provided the new member repays all refunds
taken plus interest thereon at the rate of six percent per annum
compounded annually.
(3) No person shall be required to apply for or accept a
refund.
Sec. 2. Minnesota Statutes 1989 Supplement, section
352.01, subdivision 25, is amended to read:
Subd. 25. [NORMAL RETIREMENT AGE.] "Normal retirement age"
means age 65 for a person who first became a covered employee or
a member of a pension fund listed in section 356.30, subdivision
3, before July 1, 1989. For a person who first becomes a
covered employee after June 30, 1989, normal retirement age
means the higher of age 65 or "retirement age," as defined in
United States Code, title 42, section 416(l), as amended.
Sec. 3. Minnesota Statutes 1989 Supplement, section
352.031, subdivision 2, is amended to read:
Subd. 2. [NOTICE OF TERMINATION OR DENIAL.] If the
executive director terminates a benefit or denies an application
or a written request of any person claiming a right under
chapter 352, other than sections 352.96 and 352.97; chapters 3A,
352B, 352C, and 352D; sections 490.121 to 490.133; or the
applicable sections of chapters 355 and 356, the executive
director must shall serve upon that person written notice
containing:
(1) the reasons for the termination or denial;
(2) notice that the person may petition the board for a
review of the termination or denial and that the petition for
review must be filed within 60 days of the receipt of the
written notice;
(3) a statement that relevant documentation submitted by
the petitioner to the executive director must be received in the
office of the Minnesota state retirement system at least 30 days
before the meeting prescribed in subdivision 4;
(4) a statement that failure to petition the board within
60 days will preclude the person from contesting in any other
court procedure or administrative hearing, the issues determined
by the executive director; and
(4) (5) a copy of this section.
Sec. 4. Minnesota Statutes 1989 Supplement, section
352.031, subdivision 3, is amended to read:
Subd. 3. [PETITION FOR REVIEW.] A person who claims a
right under subdivision 2 and whose benefit has been terminated
or whose application or written request has been denied may
petition for a review of that decision by the board. A petition
under this section must be served upon the executive director
personally, or by mail postmarked no later than 60 days after
the petitioner received the notice required by subdivision 2.
The petition must include the sworn, notarized statement of the
reasons the petitioner believes the decision of the executive
director should be reversed or modified and may include relevant
documentation. Relevant documentation submitted by the
petitioner to the executive director must be received in the
office of the Minnesota state retirement system at least 30 days
before the meeting prescribed in subdivision 4.
Sec. 5. Minnesota Statutes 1989 Supplement, section
352.031, is amended by adding a subdivision to read:
Subd. 5a. [EXECUTIVE DIRECTOR'S ORDER.] Notwithstanding
subdivisions 4 and 5, if the executive director determines with
respect to a petition that no relevant facts are in dispute, the
executive director shall inform the board of that determination,
and the board may issue findings of fact, a decision, reasons
for the decision, and a final order and serve it upon the
petitioner as provided in subdivision 8. If a petitioner
receives an adverse decision, the petitioner may appeal the
board's final order under subdivision 9.
Sec. 6. Minnesota Statutes 1989 Supplement, section
352.115, subdivision 3, is amended to read:
Subd. 3. [RETIREMENT ANNUITY FORMULA.] (a) This paragraph,
in conjunction with section 352.116, subdivision 1, applies to a
person who became a covered employee or a member of a pension
fund listed in section 356.30, subdivision 3, before July 1,
1989, unless paragraph (b), in conjunction with section 352.116,
subdivision 1a, produces a higher annuity amount, in which case
paragraph (b) will apply. The employee's average salary, as
defined in subdivision 2, multiplied by one percent per year of
allowable service for the first ten years and 1.5 percent for
each later year of allowable service and pro rata for completed
months less than a full year shall determine the amount of the
retirement annuity to which the employee is entitled.
(b) This paragraph applies to a person who has become at
least 55 years old and first became a covered employee after
June 30, 1989, and to any other covered employee who has become
at least 55 years old and whose annuity amount, when calculated
under this paragraph and in conjunction with section 352.116,
subdivision 1a, is higher than it is when calculated under
paragraph (a), in conjunction with section 352.116, subdivision
1. The employee's average salary, as defined in subdivision 2,
multiplied by 1.5 percent for each year of allowable service and
pro rata for months less than a full year shall determine the
amount of the retirement annuity to which the employee is
entitled.
Sec. 7. Minnesota Statutes 1989 Supplement, section
352.116, subdivision 1, is amended to read:
Subdivision 1. [REDUCED ANNUITY BEFORE NORMAL RETIREMENT
AGE.] This subdivision applies only to a person who first became
a covered employee or a member of a pension fund listed in
section 356.30, subdivision 3, before July 1, 1989, and whose
annuity is higher when calculated under section 352.115,
subdivision 3, paragraph (a), in conjunction with this
subdivision than when calculated under section 352.115,
subdivision 3, paragraph (b), in conjunction with subdivision 1a.
(a) Any employee who is eligible for a retirement annuity
under section 352.115, subdivision 1, and who retires before
normal retirement age with credit for at least three but less
than 30 years of allowable service shall be paid the normal
retirement annuity provided in section 352.115, subdivisions 2
and 3, paragraph (a), reduced by one-quarter of one percent for
each month that the employee is under normal retirement age at
the time of retirement. An employee who is eligible for a
retirement annuity under section 352.115, subdivision 1, and who
retires prior to age 62 with credit for at least 30 years of
allowable service shall be paid the normal retirement annuity
provided in section 352.115, subdivisions 2 and 3, paragraph
(a), reduced by one-quarter of one percent for each month that
the employee is under age 62 at the time of retirement.
(b) Any person whose attained age plus credited allowable
service totals 90 years is entitled, upon application, to a
retirement annuity in an amount equal to the normal annuity
provided in section 352.115, subdivisions 2 and 3, paragraph
(a), without any reduction by reason of early retirement.
Sec. 8. Minnesota Statutes 1989 Supplement, section
352.116, subdivision 1a, is amended to read:
Subd. 1a. [ACTUARIAL REDUCTION FOR EARLY RETIREMENT.] This
subdivision applies to a person who has become at least 55 years
old and first became a covered employee after June 30, 1989, and
to any other covered employee who has become at least 55 years
old and whose annuity is higher when calculated under section
352.115, subdivision 3, paragraph (b), in conjunction with this
subdivision than when calculated under section 352.115,
subdivision 3, paragraph (a), in conjunction with subdivision 1.
An A covered employee who retires before the normal retirement
age shall be paid the normal retirement annuity provided in
section 352.115, subdivisions 2 and 3, paragraph (b), reduced so
that the reduced annuity is the actuarial equivalent of the
annuity that would be payable to the employee if the employee
deferred receipt of the annuity and the annuity amount were
augmented at an annual rate of three percent compounded annually
from the day the annuity begins to accrue until the normal
retirement age.
Sec. 9. Minnesota Statutes 1989 Supplement, section
352.116, is amended by adding a subdivision to read:
Subd. 3c. [EFFECTIVE DATE OF BOUNCE-BACK ANNUITY.] In the
event of the death of the designated optional annuity
beneficiary before the retired employee or disabilitant, the
restoration of the normal single life annuity under subdivision
3a or 3b will take effect as of the first of the month following
the date of death of the designated optional annuity beneficiary
or on the first of the month following one year before the date
on which a certified copy of the death certificate of the
designated optional annuity beneficiary is received in the
office of the Minnesota state retirement system, whichever date
is later.
Sec. 10. Minnesota Statutes 1988, section 352.73, is
amended by adding a subdivision to read:
Subd. 1a. [PAYMENT ADDED.] The supplemental benefit
payable under subdivision 1 is to be added to and considered a
portion of the annuity otherwise payable to the recipient.
Sec. 11. Minnesota Statutes 1989 Supplement, section
352.93, subdivision 2a, is amended to read:
Subd. 2a. [EARLY RETIREMENT.] Any covered correctional
employee who has attained the age of becomes at least 50 years
old and who has at least five three years of allowable service
is entitled upon application to a retirement annuity equal to
the normal annuity calculated under subdivision 2, reduced so
that the reduced annuity is the actuarial equivalent of the
annuity that would be payable if the employee deferred receipt
of the annuity from the day the annuity begins to accrue to age
55.
Sec. 12. Minnesota Statutes 1989 Supplement, section
352.93, subdivision 3, is amended to read:
Subd. 3. [PAYMENTS; DURATION AND AMOUNT.] The annuity
under this section shall begin to accrue as provided in section
352.115, subdivision 8, and must be paid for an additional 84
full calendar months or to the first of the month following the
month in which the employee attains normal retirement age,
whichever occurs first, except that payment must not cease
before the first of the month following the month in which the
employee becomes 62. It must then be reduced to the amount as
calculated at normal retirement age under section 352.115,
except that if this amount, when added to that portion of the
social security benefit based on state service the employee is
would be eligible to receive at the time, is less than the
benefit payable under subdivision 2, the retired employee shall
receive an amount that when added to the social security benefit
will equal the amount payable under subdivision 2. If the
employee retired prior to age 55, the reduced benefit as
calculated under section 352.115 must be actuarially reduced as
provided in subdivision 2a.
When an annuity is reduced under this subdivision, the
percentage adjustments, if any, that have been applied to the
original annuity under section 11A.18, before the reduction,
must be compounded and applied to the reduced annuity. A former
correctional employee employed by the state in a position
covered by the regular plan or the unclassified employees
retirement program between the age of 58 and normal retirement
age shall receive a partial return of correctional contributions
at retirement with six percent interest based on the following
formula:
Employee contributions Years and complete
contributed as a months of regular
correctional employee service between
in excess of the age 58 and the
contributions the normal retirement age
employee would have X .....................
contributed as a number of years between
regular employee age 58 and normal
retirement age
Sec. 13. Minnesota Statutes 1989 Supplement, section
352B.08, subdivision 2a, is amended to read:
Subd. 2a. [EARLY RETIREMENT.] Any member who has attained
the age of become at least 50 years old and who has at
least five three years of allowable service is entitled upon
application to a retirement annuity equal to the normal annuity
calculated under subdivision 2, reduced so that the reduced
annuity is the actuarial equivalent of the annuity that would be
payable if the member deferred receipt of the annuity from the
day the annuity begins to accrue to age 55.
Sec. 14. Minnesota Statutes 1989 Supplement, section
352B.08, subdivision 3, is amended to read:
Subd. 3. [OPTIONAL ANNUITY FORMS.] In lieu of the single
life annuity provided in subdivision 2, the member or former
member with five 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 which provides that the elected
annuity be reinstated to the single life annuity provided in
subdivision 2, if after commencing the elected joint and
survivor annuity, the designated beneficiary dies before the
member, which reinstatement is not retroactive but takes effect
for the first full month occurring after the death of the
designated beneficiary. The board may also establish other
actuarial equivalent value optional annuity forms. In
establishing actuarial equivalent value 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. 15. Minnesota Statutes 1989 Supplement, section
352B.11, subdivision 2, is amended to read:
Subd. 2. [DEATH; PAYMENT TO SPOUSE AND CHILDREN.] If a
member serving actively as a member, a member receiving the
disability benefit provided by section 352B.10, subdivision 1,
or a former member receiving a disability benefit as provided by
section 352B.10, subdivision 2, dies from any cause, the
surviving spouse and dependent children are entitled to benefit
payments as follows:
(a) A member with at least three years of allowable service
is deemed to have elected a 100 percent joint and survivor
annuity payable to a surviving spouse only on or after the date
the member or former member became or would have become 55.
(b) The surviving spouse of a member who had credit for
less than three years of service shall receive, for life, a
monthly annuity equal to 50 percent of that part of the average
monthly salary of the member from which deductions were made for
retirement. If the surviving spouse remarries, the annuity
shall cease as of the date of the remarriage.
(c) The surviving spouse of a member who had credit for at
least three years service and who died after attaining becoming
55 years of age old, may elect to receive a 100 percent joint
and survivor annuity, for life, notwithstanding a subsequent
remarriage, in lieu of the annuity prescribed in paragraph (b).
(d) The surviving spouse of any member who had credit for
three years or more and who was not 55 years of age old at
death, shall receive the benefit equal to 50 percent of the
average monthly salary as described in clause (b) until the
deceased member would have reached the age of become 55 years
old, and beginning the first of the month following that date,
may elect to receive the 100 percent joint and survivor
annuity. If the surviving spouse remarries before the deceased
member's 55th birthdate birth date, benefits or annuities shall
cease as of the date of remarriage. Remarriage after the
deceased member's 55th birthday shall not affect the payment of
the benefit.
(e) Each dependent child shall receive a monthly annuity
equal to ten percent of that part of the average monthly salary
of the former member from which deductions were made for
retirement. A dependent child over 18 and under 23 years of age
also may receive the monthly benefit provided in this section,
if the child is continuously attending an accredited school as a
full-time student during the normal school year as determined by
the director. If the child does not continuously attend school
but separates from full-time attendance during any part of a
school year, the annuity shall cease at the end of the month of
separation. In addition, a payment of $20 per month shall be
prorated equally to surviving dependent children when the former
member is survived by one or more dependent children. Payments
for the benefit of any qualified dependent child must be made to
the surviving spouse, or if there is none, to the legal guardian
of the child. The maximum monthly benefit for any one family
must not be less than 50 nor exceed 70 percent of the average
monthly salary for any number of children.
(f) If the member dies under circumstances that entitle the
surviving spouse and dependent children to receive benefits
under the workers' compensation law, the workers' compensation
benefits received by them must not be deducted from the benefits
payable under this section.
(g) The surviving spouse of a deceased former member who
had credit for three or more years of allowable service, but not
the spouse of a former member receiving a disability benefit
under section 352B.10, subdivision 2, is entitled to receive the
100 percent joint and survivor annuity at the time the deceased
member would have reached the age of become 55 years old, if the
surviving spouse has not remarried before that date. If a
former member dies who does not qualify for other benefits under
this chapter, the surviving spouse or, if none, the children or
heirs are entitled to a refund of the accumulated deductions
left in the fund plus interest at the rate of six percent per
year compounded annually.
Sec. 16. Minnesota Statutes 1988, section 352B.11,
subdivision 4, is amended to read:
Subd. 4. [REENTRY INTO STATE SERVICE.] When a former
member, who has become separated from state service that
entitled the member to membership and has received a refund of
retirement payments, reenters the state service in a position
that entitles the member to membership, that member shall
receive credit for the period of prior allowable state service
if the member repays into the fund the amount of the refund,
plus interest on it at the rate of five six percent per year, at
any time before subsequent retirement. Repayment may be made in
installments or in a lump sum.
Sec. 17. Minnesota Statutes 1988, section 352C.09,
subdivision 2, is amended to read:
Subd. 2. (1) Any person who has made contributions
pursuant to subdivision 1 who is no longer a constitutional
officer or commissioner is entitled to receive upon application
to the director a refund of all contributions credited to the
individual's account with interest at the rate of five six
percent per annum compounded annually.
(2) The refund of contributions as provided in clause (1)
above terminates all rights of a former constitutional officer
or commissioner or survivors thereof under the provisions of
this chapter. Should the former constitutional officer or
commissioner again hold such office after having taken a refund
as provided above, the former officer or commissioner shall be
considered a new member and may reinstate the rights and credit
for service forfeited provided all refunds previously taken are
repaid with interest at six percent per annum compounded
annually.
(3) No person shall be required to apply for or accept a
refund.
Sec. 18. Minnesota Statutes 1988, section 352D.05,
subdivision 3, is amended to read:
Subd. 3. Thirty days after termination of covered
employment or at any time thereafter, a participant shall be is
entitled, upon application, to withdraw the cash value of the
participant's total shares or may leave such shares on deposit
with the supplemental retirement fund. Shares not withdrawn
shall must remain on deposit with the supplemental retirement
fund until the former participant attains the age of becomes at
least 58 55 years old, and applies for an annuity as provided in
under section 352D.06, subdivision 1.
Sec. 19. Minnesota Statutes 1989 Supplement, section
353.01, subdivision 37, is amended to read:
Subd. 37. [NORMAL RETIREMENT AGE.] "Normal retirement age"
means age 65 for a person who first became a public employee or
a member of a pension fund listed in section 356.30, subdivision
3, before July 1, 1989. For a person who first becomes a public
employee after June 30, 1989, "normal retirement age" means the
higher of age 65 or "retirement age," as defined in United
States Code, title 42, section 416(l), as amended.
Sec. 20. Minnesota Statutes 1989 Supplement, section
353.29, subdivision 3, is amended to read:
Subd. 3. [RETIREMENT ANNUITY FORMULA.] (a) This paragraph,
in conjunction with section 353.30, subdivisions 1, 1a, 1b, and
1c, applies to any member who first became a public employee or
a member of a pension fund listed in section 356.30, subdivision
3, before July 1, 1989, unless paragraph (b), in conjunction
with section 353.30, subdivision 5, produces a higher annuity
amount, in which case paragraph (b) will apply. The average
salary as defined in subdivision 2, multiplied by two percent
for each year of allowable service for the first ten years and
thereafter by 2.5 percent per year of allowable service and
completed months less than a full year for the "basic member",
and one percent for each year of allowable service for the first
ten years and thereafter by 1.5 percent per year of allowable
service and completed months less than a full year for the
"coordinated member," shall determine the amount of the "normal"
retirement annuity.
(b) This paragraph applies to a member who has become at
least 55 years old and first became a public employee after June
30, 1989, and to any other member whose annuity amount, when
calculated under this paragraph and in conjunction with section
353.30, subdivision 5, is higher than it is when calculated
under paragraph (a), in conjunction with section 353.30,
subdivisions 1, 1a, 1b, and 1c. The average salary, as defined
in subdivision 2, multiplied by 2.5 percent for each year of
allowable service and completed months less than a full year for
a basic member and 1.5 percent per year of allowable service and
completed months less than a full year for a coordinated member,
shall determine the amount of the normal retirement annuity.
Sec. 21. Minnesota Statutes 1989 Supplement, section
353.30, is amended to read:
353.30 [ANNUITIES UPON RETIREMENT.]
Subdivision 1. Upon separation from public service, any
person who first became a public employee or a member of a
pension fund listed in section 356.30, subdivision 3, before
July 1, 1989, and who has attained the age of become at least 58
years old but not more than normal retirement age and who
received credit for not less than 20 years of allowable service
is entitled upon application to a retirement annuity in an
amount equal to the normal annuity provided in section 353.29,
subdivisions 2 and 3, paragraph (a), reduced by one-quarter of
one percent for each month that the member is under normal
retirement age at the time of retirement.
Subd. 1a. Any person who first became a public employee or
a member of a pension fund listed in section 356.30, subdivision
3, before July 1, 1989, and whose attained age plus credited
allowable service totals 90 years is entitled upon application
to a retirement annuity in an amount equal to the normal annuity
provided in section 353.29, subdivisions 2 and 3, paragraph (a),
without any reduction in annuity by reason of such early
retirement.
Subd. 1b. Any person who first became a public employee or
a member of a pension fund listed in section 356.30, subdivision
3, before July 1, 1989, with 30 years or more of allowable
service credit, who elects early retirement under subdivision 1,
shall receive an annuity in an amount equal to the normal
annuity provided under section 353.29, subdivisions 2 and 3,
paragraph (a), reduced by one-quarter of one percent for each
month that the member is under age 62 at the time of retirement.
Subd. 1c. Any person who first became a public employee or
a member of a pension fund listed in section 356.30, subdivision
3, before July 1, 1989, and who has received credit for at least
30 years of allowable service or who has attained the age
of become at least 55 years old but not normal retirement age,
and has received credit for at least three years of allowable
service is entitled upon application to a retirement annuity in
an amount equal to the normal annuity provided in section
353.29, subdivisions 2 and 3, paragraph (a), reduced by
one-quarter of one percent for each month that the member is
under normal retirement age at the time of retirement, except
that for any member who has 30 or more years of allowable
service the reduction shall be applied only for each month that
the member is under age 62 at the time of retirement.
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. Except as provided in
subdivision 3a, the optional annuity forms shall be actuarially
equivalent to the forms provided in section 353.29 and
subdivisions 1, 1a, 1b, 1c, and 5. In establishing those
optional forms, 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. 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.
Subd. 3a. [BOUNCE-BACK ANNUITY.] (a) If a former member or
disabilitant selects a joint and survivor annuity option under
subdivision 3, the former member or disabilitant must receive a
normal single life annuity if the designated optional annuity
beneficiary dies before the former member or disabilitant.
Under this option, no reduction may be made in the person's
annuity to provide for restoration of the normal single life
annuity in the event of the death of the designated optional
annuity beneficiary.
(b) A former member or disabilitant who selected an
optional joint and survivor annuity before July 1, 1989, but did
not choose an option that provides that the normal single life
annuity is payable to the former member or the disabilitant if
the designated optional annuity beneficiary dies first, is
eligible for restoration of the normal single life annuity if
the designated optional annuity beneficiary dies first, without
further actuarial reduction of the person's annuity. A former
member or disabilitant who selected an optional joint and
survivor annuity, but whose designated optional annuity
beneficiary died before July 1, 1989, shall receive a normal
single life annuity after that date, but shall not receive
retroactive payments for periods before that date.
(c) A former member or disabilitant who took a further
actuarial reduction to elect an optional joint and survivor
annuity that provides that the normal annuity is payable to the
former member or disabilitant if the designated optional
beneficiary dies first but has not died before July 1, 1989,
shall have their annuity increased as of July 1, 1989, to the
amount the person would have received if, at the time of
retirement or disability, the person had selected only optional
survivor coverage that would not have provided for restoration
of the normal annuity upon the death of the designated optional
annuity beneficiary. Any annuity or benefit increase under this
paragraph is effective only for payments made after June 30,
1989, and is not retroactive for payments made before July 1,
1989.
Subd. 3b. [BOUNCE-BACK ANNUITY.] (a) The board of trustees
must provide a joint and survivor annuity option to members of
the police and fire fund. Under this option, a former member or
disabilitant must receive a normal single life annuity if the
designated optional annuity beneficiary dies before the former
member or disabilitant. Under this option, no reduction may be
made in the person's annuity to provide for restoration of the
normal single life annuity in the event of the death of the
designated optional annuity beneficiary.
(b) A former member or disabilitant of the police and fire
fund who selected an optional joint and survivor annuity before
July 1, 1989, but did not choose an option that provides that
the normal single life annuity is payable to the former member
or the disabilitant if the designated optional annuity
beneficiary dies first, is eligible for restoration of the
normal single life annuity if the designated optional annuity
beneficiary dies first, without further actuarial reduction of
the person's annuity. A former member or disabilitant who
selected an optional joint and survivor annuity, but whose
designated optional annuity beneficiary died before July 1,
1989, shall receive a normal single life annuity after that
date, but shall not receive retroactive payments for periods
before that date.
(c) A former member or disabilitant who took a further
actuarial reduction to elect an optional joint and survivor
annuity that provides that the normal annuity is payable to the
former member or disabilitant if the designated optional
beneficiary dies first but has not died before July 1, 1989,
shall have their annuity increased as of July 1, 1989, to the
amount the person would have received if, at the time of
retirement or disability, the person had selected only optional
survivor coverage that would not have provided for restoration
of the normal annuity upon the death of the designated optional
annuity beneficiary. Any annuity or benefit increase under this
paragraph is effective only for payments made after June 30,
1989, and is not retroactive for payments made before July 1,
1989.
Subd. 3c. [EFFECTIVE DATE OF BOUNCE-BACK ANNUITY.] In the
event of the death of the designated optional annuity
beneficiary before the retired employee or disabilitant, the
restoration of the normal single life annuity under subdivision
3a or 3b will take effect on the first of the month following
the date of death of the designated optional annuity beneficiary
or on the first of the month following one year before the date
on which a certified copy of the death certificate is received
in the office of the public employees retirement association,
whichever date is later.
Subd. 4. Any Monthly payments to which any person may be
entitled under this chapter may be reduced in amount upon
application of the person entitled thereto to the association,
provided that the person shall first relinquish in writing all
claim to that part of the full monthly payment which is the
difference between the monthly payment which that person would
be otherwise entitled to receive and the monthly payment which
that person will receive. The reduced monthly payment shall be
payment in full of all amounts due under this chapter for the
month for which the payment is made and acceptance of the
reduced monthly payment releases the retirement association from
all obligation to pay to the person the difference between the
amount of the reduced monthly payment and the full amount of the
monthly payment which the person would otherwise have received.
Upon application of the person who is entitled to such monthly
payment, it may be increased prospectively to not more than the
amount to which the person would have been entitled had no
portion thereof been waived.
Subd. 5. [ACTUARIAL REDUCTION FOR EARLY RETIREMENT.] This
subdivision applies to a member who has become at least 55 years
old and first became a public employee after June 30, 1989, and
to any other member who has become at least 55 years old and
whose annuity is higher when calculated under section 353.29,
subdivision 3, paragraph (b), in conjunction with this
subdivision than when calculated under section 353.29,
subdivision 3, paragraph (a), in conjunction with subdivision 1,
1a, 1b, or 1c. An employee who retires before normal retirement
age shall be paid the retirement annuity provided in section
353.29, subdivision 3, paragraph (b), reduced so that the
reduced annuity is the actuarial equivalent of the annuity that
would be payable to the employee if the employee deferred
receipt of the annuity and the annuity amount were augmented at
an annual rate of three percent compounded annually from the day
the annuity begins to accrue until the normal retirement age.
Sec. 22. Minnesota Statutes 1989 Supplement, section
353.651, subdivision 4, is amended to read:
Subd. 4. [EARLY RETIREMENT.] Any police officer or
firefighter member who has attained the age of become at least
50 years old and who has at least five three years of allowable
service is entitled upon application to a retirement annuity
equal to the normal annuity calculated under subdivision 3,
reduced so that the reduced annuity is the actuarial equivalent
of the annuity that would be payable to the member if the member
deferred receipt of the annuity from the day the annuity begins
to accrue until the member attains age 55.
Sec. 23. Minnesota Statutes 1989 Supplement, section
354.05, subdivision 38, is amended to read:
Subd. 38. [NORMAL RETIREMENT AGE.] "Normal retirement age"
means age 65 for a person who first became a member of the
fund or a member of a pension fund listed in section 356.30,
subdivision 3, before July 1, 1989. For a person who first
becomes a member of the fund after June 30, 1989, normal
retirement age means the higher of age 65 or "retirement age,"
as defined in United States Code, title 42, section 416(l), as
amended.
Sec. 24. Minnesota Statutes 1988, section 354.07,
subdivision 4, is amended to read:
Subd. 4. It shall be the duty of the board from time to
time to certify to the state board of investment for investment
as much of the funds in its hands as shall not be needed for
current purposes. Such funds that are certified to the variable
annuity division shall include employee deductions as well as an
equal amount for state's matching. Such funds that are
certified as to investment in the postretirement investment fund
shall include the amount as required for the total reserves
needed for the purposes described in section 354.63. The state
board of investment shall thereupon transfer such assets to the
appropriate fund provided herein, in accordance with the
procedure set forth in sections 354.62 and section 354.63, or
invest and reinvest an amount equal to the sum so certified in
such securities as are now or may hereafter be duly authorized
legal investments for state employees retirement fund and all
such securities so transferred or purchased shall be deposited
with the state treasurer. All interest from these investments
shall be credited to the appropriate funds and used for current
purposes or investments, except as hereinafter provided. The
state board of investment shall have authority to sell, convey,
and exchange such securities and invest and reinvest the funds
when it deems it desirable to do so, and shall sell securities
upon request of the officers of the association when such
officers determine funds are needed for its purposes. All of
the provisions regarding accounting procedures and restrictions
and conditions for the purchase and sale of securities for the
state employees retirement fund shall apply to the accounting,
purchase and sale of securities for the teachers' retirement
fund.
Sec. 25. Minnesota Statutes 1989 Supplement, section
354.071, subdivision 2, is amended to read:
Subd. 2. [NOTICE OF TERMINATION OR DENIAL.] If the
executive director terminates a benefit or denies an application
or a written request of any person claiming a right under this
chapter or the applicable sections of chapters 136, 355, and
356, the executive director must serve upon that person a
written notice. The notice must contain:
(1) the reasons for the termination or denial;
(2) notice that the person may petition the board for a
review of the termination or denial and that the petition for
review must be filed within 60 days of the receipt of the
written notice;
(3) a statement that relevant documentation submitted by
the petitioner to the executive director must be received in the
office of the teachers retirement association at least 30 days
before the meeting prescribed in subdivision 4;
(4) a statement that failure to petition the board within
60 days will preclude the person from contesting in any other
court procedure or administrative hearing, the issues determined
by the executive director; and
(4) (5) a copy of this section.
Sec. 26. Minnesota Statutes 1989 Supplement, section
354.071, subdivision 3, is amended to read:
Subd. 3. [PETITION FOR REVIEW.] A person who claims a
right under subdivision 2 and whose benefit has been terminated
or whose application or written request has been denied may
petition for a review of that decision by the board. A petition
under this section must be served upon the executive director
personally, or by mail postmarked no later than 60 days after
the petitioner received the notice required by subdivision 2.
The petition must include the sworn, notarized statement of the
reasons the petitioner believes the decision of the executive
director should be reversed or modified and may include relevant
documentation. Relevant documentation submitted by the
petitioner to the executive director must be received in the
office of the teachers retirement association at least 30 days
before the meeting prescribed in subdivision 4.
Sec. 27. Minnesota Statutes 1989 Supplement, section
354.071, is amended by adding a subdivision to read:
Subd. 5a. [EXECUTIVE DIRECTOR'S ORDER.] Notwithstanding
subdivisions 4 and 5, if the executive director determines with
respect to a petition that no relevant facts are in dispute, the
executive director shall inform the board of that determination,
and the board may issue findings of fact, a decision, reasons
for the decision, and a final order and serve it upon the
petitioner as provided in subdivision 8. If a petitioner
receives an adverse decision, the petitioner may appeal the
board's final order under subdivision 9.
Sec. 28. Minnesota Statutes 1988, section 354.146,
subdivision 1, is amended to read:
Subdivision 1. Every member who has rendered teaching
service or was on an authorized leave of absence after June 30,
1972 is covered by the full formula program except that those
members who have contributed to the variable annuity fund are
covered by the combined formula and variable annuity program.
The benefit of a former member who does not return to teaching
service prior to before retirement shall be determined under the
program in effect at the time of termination.
Sec. 29. Minnesota Statutes 1988, section 354.42,
subdivision 2, is amended to read:
Subd. 2. The employee contribution to the fund shall be an
amount equal to 4-1/2 percent of the salary of every coordinated
member and 8-1/2 percent of the salary of every basic member.
This contribution shall be made by deduction from salary. Where
any portion of a member's salary is paid from other than public
funds, such member's employee contribution shall be based on the
entire salary received. For purposes of financing the various
options related to the variable annuity division, employee
variable annuity contributions will be credited in accordance
with section 354.62, subdivision 2.
Sec. 30. Minnesota Statutes 1988, section 354.42,
subdivision 3, is amended to read:
Subd. 3. The employer contribution to the fund shall be an
amount equal to 4-1/2 percent of the salary of each coordinated
member and 8-1/2 percent of the salary of each basic member.
This contribution shall be made in the manner provided in
section 354.43. For purposes of financing the various options
related to the variable annuity division, employer contributions
equal to the employee variable annuity contributions prescribed
in section 354.62, subdivision 2, shall be allocated at the same
time to the employer variable annuity contribution account in
section 354.62, subdivision 3.
Sec. 31. Minnesota Statutes 1989 Supplement, section
354.44, subdivision 6, is amended to read:
Subd. 6. [COMPUTATION OF FORMULA PROGRAM RETIREMENT
ANNUITY.] (1) The formula retirement annuity hereunder shall be
computed in accordance with the applicable provisions of the
formulas stated in clause (2) or (4) on the basis of each
member's average salary for the period of the member's formula
service credit. For the purposes of computing the formula
benefits under the formula and variable program, if a
combination of these formulas is used, the formula percentages
used will be those percentages in each formula as continued for
the respective years of service from one formula to the next.
For all years of formula service credit, "average salary,"
for the purpose of determining the member's retirement annuity,
means the average salary upon which contributions were made and
upon which payments were made to increase the salary limitation
provided in Minnesota Statutes 1971, section 354.511 for the
highest five successive years of formula service credit
provided, however, that such "average salary" shall not include
any more than the equivalent of 60 monthly salary payments.
Average salary must be based upon all years of formula service
credit if this service credit is less than five years.
(2) This clause, in conjunction with clause (3), applies to
a person who first became a member of the fund or a member of a
pension fund listed in section 356.30, subdivision 3, before
July 1, 1989, unless clause (4), in conjunction with clause (5),
produces a higher annuity amount, in which case clause (4)
applies. The average salary as defined in clause (1),
multiplied by the following percentages per year of formula
service credit shall determine the amount of the annuity to
which the member qualifying therefor is entitled:
Coordinated Member Basic Member
Each year of service 1.0 percent 2.0 percent
during first ten per year per year
Each year of service 1.5 percent 2.5 percent
thereafter per year per year
(3)(i) This clause applies only to a person who first
became a member of the fund or a member of a pension fund listed
in section 356.30, subdivision 3, before July 1, 1989, and whose
annuity is higher when calculated under clause (2), in
conjunction with this clause than when calculated under clause
(4), in conjunction with clause (5).
(ii) Where any member retires prior to normal retirement
age under a formula annuity, the member shall be paid a
retirement annuity in an amount equal to the normal annuity
provided in clause (2) and subdivision 7, paragraph (a), reduced
by one-quarter of one percent for each month that the member is
under normal retirement age at the time of retirement except
that for any member who has 30 or more years of allowable
service credit, the reduction shall be applied only for each
month that the member is under age 62.
(iii) Any member whose attained age plus credited allowable
service totals 90 years is entitled, upon application, to a
retirement annuity in an amount equal to the normal annuity
provided in clause (2), without any reduction by reason of early
retirement.
(4) This clause applies to a member who has become at least
55 years old and first became a member of the fund after June
30, 1989, and to any other member who has become at least 55
years old and whose annuity amount when calculated under this
clause and in conjunction with clause (5), is higher than it is
when calculated under clause (2), in conjunction with clause (3).
The average salary, as defined in clause (1) multiplied by 2.5
percent for each year of service for a basic member and by 1.5
percent for each year of service for a coordinated member shall
determine the amount of the retirement annuity to which the
member is entitled.
(5) This clause applies to a person who has become at least
55 years old and first becomes a member of the fund after June
30, 1989, and to any other member who has become at least 55
years old and whose annuity is higher when calculated under
clause (4) in conjunction with this clause than when calculated
under clause (2), in conjunction with clause (3). An employee
who retires under the formula annuity before the normal
retirement age shall be paid the normal annuity provided in
clause (4) and subdivision 7, paragraph (b), reduced so that the
reduced annuity is the actuarial equivalent of the annuity that
would be payable to the employee if the employee deferred
receipt of the annuity and the annuity amount were augmented at
an annual rate of three percent compounded annually from the day
the annuity begins to accrue until the normal retirement age.
Sec. 32. Minnesota Statutes 1989 Supplement, section
354.45, subdivision 1a, is amended to read:
Subd. 1a. [BOUNCE-BACK ANNUITY.] (a) If a former member or
disabilitant selects a joint and survivor annuity option under
subdivision 1, the former member or disabilitant must receive a
normal single life annuity if the designated optional annuity
beneficiary dies before the former member or disabilitant.
Under this option, no reduction may be made in the person's
annuity to provide for restoration of the normal single life
annuity in the event of the death of the designated optional
annuity beneficiary.
(b) A former member or disabilitant who selected an
optional joint and survivor annuity before July 1, 1989, but did
not choose an option that provides that the normal single life
annuity is payable to the former member or the disabilitant if
the designated optional annuity beneficiary dies first, is
eligible for restoration of the normal single life annuity if
the designated optional annuity beneficiary dies first, without
further actuarial reduction of the person's annuity. A former
member or disabilitant who selected an optional joint and
survivor annuity, but whose designated optional annuity
beneficiary died before July 1, 1989, shall receive a normal
single life annuity after that date, but shall not receive
retroactive payments for periods before that date.
(c) The restoration of the normal single life annuity under
this subdivision will take effect on the first of the month
following the date of death of the designated optional annuity
beneficiary or on the first of the month following one year
before the date on which a certified copy of the death
certificate of the designated optional annuity beneficiary is
received in the office of the teachers retirement association,
whichever date is later.
Sec. 33. Minnesota Statutes 1988, section 354.46,
subdivision 1, is amended to read:
Subdivision 1. [BASIC PROGRAM; BENEFITS FOR SPOUSE AND
CHILDREN OF TEACHER.] If a basic member who has at least 18
months of allowable service credit and who has an average salary
as defined in section 354.44, subdivision 6 equal to or greater
than $75 dies prior to retirement or if a former basic member
who, at the time of death, was totally and permanently disabled
and receiving disability benefits pursuant to section 354.48
dies prior to attaining the age of 65 years, the surviving
dependent spouse and dependent children of the basic member or
former basic member shall be entitled to receive a monthly
benefit as follows:
(a) Surviving
dependent
spouse .....50 percent of the basic member's monthly
average salary paid in the last full
fiscal year preceding death
(b) Each
dependent
child ......ten percent of the basic member's
monthly average salary paid in the
last full fiscal year preceding death
Payments for the benefit of any dependent child under the
age of 22 years shall be made to the surviving parent, or if
there be none, to the legal guardian of the child. The maximum
monthly benefit shall not exceed $1,000 for any one family, and
the minimum benefit per family shall not be less than 50 percent
of the basic member's average salary, subject to the foregoing
maximum. The surviving dependent spouse benefit shall terminate
upon remarriage, and the surviving dependent children's benefit
shall be reduced pro tanto when any surviving child is no longer
dependent.
If the basic member and the surviving dependent spouse are
killed in a common disaster and if the total of all survivors
benefits payable pursuant to this subdivision is less than the
accumulated deductions plus interest payable, the surviving
dependent children shall receive the difference in a lump sum
payment.
If the survivor benefits provided in this subdivision
exceed in total the monthly average salary of the deceased basic
member, these benefits shall be reduced to an amount equal to
the deceased basic member's monthly average salary.
Prior to payment of any survivor benefit pursuant to this
subdivision, in lieu of that benefit, the surviving dependent
spouse may elect to receive the joint and survivor annuity
provided pursuant to subdivision 2, or may elect to receive a
refund of accumulated deductions with interest in a lump sum as
provided pursuant to sections section 354.47, subdivision 1 or
354.62, subdivision 5, clause (3). If there are any surviving
dependent children, the surviving dependent spouse may elect to
receive the refund of accumulated deductions only with the
consent of the district court of the district in which the
surviving dependent child or children reside.
Sec. 34. Minnesota Statutes 1989 Supplement, section
354.46, subdivision 2, is amended to read:
Subd. 2. [DEATH WHILE ELIGIBLE DESIGNATED BENEFICIARY
BENEFIT.] The surviving spouse of any member or former member
who has attained the age of at least 50 years and has credit for
at least three years of allowable service or who has credit for
at least 30 years of allowable service irrespective of age shall
be entitled to joint and survivor annuity coverage in the event
of death of the member prior to retirement. If the surviving
spouse does not elect to receive a surviving spouse benefit
provided pursuant to subdivision 1, if applicable, or does not
elect to receive a refund of accumulated member contributions
provided pursuant to section 354.47, subdivision 1, or 354.62,
subdivision 5, clause (3), whichever is applicable, the
surviving spouse shall be entitled to receive, upon written
application on a form prescribed by the executive director, a
benefit equal to the second portion of a 100 percent joint and
survivor annuity as provided pursuant to section 354.45 and
computed pursuant to section 354.44, subdivision 2, 6, or 7,
whichever is applicable. The surviving spouse may apply for the
annuity at any time after the date on which the deceased
employee would have attained the required age for retirement
based on the employee's allowable service. Sections 354.44,
subdivisions 6 and 7, and 354.60 apply to a deferred annuity
payable under this section. If the member was a participant in
the variable annuity division, the applicable portion of the
benefit shall be computed pursuant to section 354.62,
subdivision 5, clause (1). The benefit shall be payable for
life.
Sec. 35. Minnesota Statutes 1989 Supplement, section
354.47, subdivision 1, is amended to read:
Subdivision 1. [DEATH BEFORE RETIREMENT.] (1) If a member
dies before retirement and is covered pursuant to the provisions
of section 354.44, subdivision 2, and neither an optional
annuity, nor a reversionary annuity, nor a benefit pursuant to
section 354.46, subdivision 1, is payable to the survivors if
the member was a basic member, the surviving spouse, or if there
is no surviving spouse, the designated beneficiary shall be
entitled to an amount equal to the member's accumulated
deductions with interest credited to the account of the member
to the date of death.
(2) If a member dies before retirement and is covered
pursuant to the provisions of section 354.44,
subdivisions subdivision 6 and 7, and neither an optional
annuity, nor reversionary annuity, nor the benefit described in
section 354.46, subdivision 1, is payable to the survivors if
the member was a basic member, the surviving spouse, or if there
is no surviving spouse, the designated beneficiary shall be
entitled to an amount equal to the member's accumulated
deductions credited to the account of the member as of June 30,
1957, and from July 1, 1957, to the date of death the member's
accumulated deductions plus interest at the rate of six percent
per annum compounded annually.
(3) The amounts payable in clause (1) or (2) are in
addition to the amount payable in section 354.62, subdivision 5,
for the member's variable annuity account.
Sec. 36. Minnesota Statutes 1989 Supplement, 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 on the amount computed as
though the teacher were at normal retirement age 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 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 the member attains normal retirement age
at the rate of three percent;
(d) annuity purchase rates based on an appropriate annuity
table of mortality 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 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 section 354.44,
subdivision 6 or 7, whichever is applicable. The disability
benefit shall be the formula annuity without the reduction for
each month the member is under normal retirement age 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. 37. Minnesota Statutes 1989 Supplement, section
354.49, subdivision 2, is amended to read:
Subd. 2. Except as provided in section 354.44, subdivision
1, any person who ceases to be a member by reason of termination
of teaching service, shall receive a refund in an amount equal
to the accumulated deductions credited to the account as of June
30, 1957, and after July 1, 1957, the accumulated deductions
with interest at the rate of six percent per annum compounded
annually plus any variable annuity account accumulations payable
pursuant to section 354.62, subdivision 5, clause (4). For the
purpose of this subdivision, interest shall be computed on
fiscal year end balances to the first day of the month in which
the refund is issued.
Sec. 38. Minnesota Statutes 1989 Supplement, section
354.49, subdivision 3, is amended to read:
Subd. 3. Any person who has attained normal retirement age
with less than three years of credited allowable service shall
be entitled to receive a refund in an amount equal to the
person's accumulated deductions plus interest in lieu of a
proportionate annuity pursuant to section 356.32 except those
covered under the provisions of section 354.44, subdivision 6 or
7, in which case the refund shall be an amount equal to the
accumulated deductions credited to the person's account as of
June 30, 1957, and after July 1, 1957, the accumulated
deductions plus interest at the rate of six percent compounded
annually.
Sec. 39. Minnesota Statutes 1989 Supplement, section
354.50, subdivision 5, is amended to read:
Subd. 5. Notwithstanding section 354.62, subdivision 5,
clause (4), A member who received a refund of variable account
accumulations may repay this refund to the member's formula
account under this section.
Sec. 40. Minnesota Statutes 1988, section 354.52,
subdivision 2, is amended to read:
Subd. 2. Each school board or managing body shall, on or
before August 1, each year, report to the teachers retirement
board giving an itemized summary of the total amount withheld
from the salaries of teachers for regular teacher's teachers
retirement deductions and for variable annuity deductions, and
such other information as the executive director may require.
If the itemized summary is received after August 1 in any year,
there shall be a penalty not to exceed $25 for each month or
portion thereof which the summary is delinquent, as determined
by the board of trustees. The penalty shall be paid by the
school board or the managing body.
Sec. 41. Minnesota Statutes 1989 Supplement, section
354.55, subdivision 11, is amended to read:
Subd. 11. [DEFERRED ANNUITY; AUGMENTATION.] Any person
covered under section 354.44, subdivisions subdivision 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 subdivision 6 and 7,
and augmented as provided in this subdivision. The required
reserves related to that portion of the annuity which had
accrued 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
compounded annually commencing July 1, 1971, until January 1,
1981, and three percent compounded annually thereafter until
January 1 of the year following the year in which the former
member attains age 55. From that date to the effective date of
retirement, the rate is five percent compounded annually. 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 repays a refund, the service
restored by the repayment must be considered as continuous with
the next period of service for which the person has credit with
this fund. 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 of teaching service shall be those
applicable to new members. The mortality table and interest
assumption used to compute the annuity shall be the applicable
mortality table established by the board under section 354.07,
subdivision 1, and the interest rate assumption under section
356.215 in effect when the member retires. A period of
uninterrupted service for the purposes of this subdivision 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 under this subdivision
be less than the amount of annuity payable pursuant to section
354.44, subdivisions subdivision 6 and 7.
The requirements and provisions for retirement before
normal retirement age contained in section 354.44, subdivision
6, clause (3) or (5), 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 applies to
the benefit provided in section 354.46, subdivision 2.
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. 42. Minnesota Statutes 1988, section 354.55,
subdivision 19, is amended to read:
Subd. 19. Any member or retired former member who is
covered by the formula or formula and variable programs in
effect after June 30, 1973 and who made payments to the fund
pursuant to Minnesota Statutes 1965, section 354.511 shall upon
request receive a refund of such payments.
Sec. 43. Minnesota Statutes 1989 Supplement, section
354.65, is amended to read:
354.65 [ADMINISTRATIVE EXPENSES.]
Necessary and reasonable administrative expenses incurred
by the teachers retirement association must be prorated and
allocated to the teachers retirement fund, and the
organization's participation in both the Minnesota variable
annuity investment fund and the Minnesota supplemental
investment fund in accordance with policies and procedures
established by the board of trustees of the teachers retirement
association.
Sec. 44. Minnesota Statutes 1989 Supplement, section
354.66, subdivision 2, is amended to read:
Subd. 2. A teacher in the public elementary schools,
secondary schools, or technical institutes or in the community
college system or the state university system of the state who
has 20 years or more of allowable service in the fund or 20
years or more of full-time teaching service in Minnesota public
elementary schools, secondary schools, or technical institutes
or in the community college system or the state university
system, or a teacher in the community college system or state
university system who has attained at least age 55 and has ten
years or more of allowable service in the fund or ten years or
more of full-time teaching service as described in this
subdivision, may, by agreement with the board of the employing
district, be assigned to teaching service within the district in
a part-time teaching position.
Sec. 45. Minnesota Statutes 1989 Supplement, section
354A.011, subdivision 15a, is amended to read:
Subd. 15a. [NORMAL RETIREMENT AGE.] "Normal retirement
age" means age 65 for a person who first became a member of the
coordinated program of the Minneapolis or St. Paul teachers
retirement fund association or the new law coordinated program
of the Duluth teachers retirement fund association or a member
of a pension fund listed in section 356.30, subdivision 3,
before July 1, 1989. For a person who first became a member of
the coordinated program of the Minneapolis or St. Paul teachers
retirement fund association or the new law coordinated program
of the Duluth teachers retirement fund association after June
30, 1989, normal retirement age means the higher of age 65 or
retirement age, as defined in United States Code, title 42,
section 416(l), as amended. For a person who is a member of the
basic program of the Minneapolis or St. Paul teachers retirement
fund association or the old law coordinated program of the
Duluth teachers retirement fund association, normal retirement
age means the age at which a teacher becomes eligible for a
normal retirement annuity computed upon meeting the age and
service requirements specified in the applicable provisions of
the articles of incorporation or bylaws of the respective
teachers retirement fund association.
Sec. 46. Minnesota Statutes 1989 Supplement, section
354A.095, is amended to read:
354A.095 [MATERNITY LEAVE.]
A Basic or coordinated member members of the St. Paul
teachers retirement fund association and old or new coordinated
members of the Duluth teachers retirement fund association, who
are granted parental or maternity leave of absence by the
employing authority, are entitled to obtain service credit not
to exceed one year for the period of leave upon payment to the
applicable fund by the end of the fiscal year following the
fiscal year in which the leave of absence terminated. The
amount of the payment must include the total required employee
and employer contributions for the period of leave prescribed in
section 354A.12. Payment must be based on the member's average
monthly salary upon return to teaching service, and is payable
without interest. Payment must be accompanied by a certified or
otherwise adequate copy of the resolution or action of the
employing authority granting or approving the leave.
Sec. 47. Minnesota Statutes 1989 Supplement, section
354A.31, subdivision 4, is amended to read:
Subd. 4. [COMPUTATION OF THE NORMAL COORDINATED RETIREMENT
ANNUITY.] (a) The normal coordinated retirement annuity shall be
an amount equal to a retiring coordinated member's average
salary multiplied by the retirement annuity formula percentage.
Average salary for purposes of this section shall mean an amount
equal to the average salary upon which contributions were made
for the highest five successive years of service credit, but
which shall not in any event include any more than the
equivalent of 60 monthly salary payments. Average salary must
be based upon all years of service credit if this service credit
is less than five years.
(b) This paragraph, in conjunction with subdivision 6,
applies to a person who first became a member or a member in a
pension fund listed in section 356.30, subdivision 3, before
July 1, 1989, unless paragraph (c), in conjunction with
subdivision 7, produces a higher annuity amount, in which case
paragraph (c) will apply. The retirement annuity formula
percentage for purposes of this paragraph is one percent per
year for each year of coordinated service for the first ten
years and 1-1/2 1.5 percent for each year of coordinated service
thereafter.
(c) This paragraph applies to a person who has become at
least 55 years old and who first becomes a member after June 30,
1989, and to any other member who has become at least 55 years
old and whose annuity amount, when calculated under this
paragraph and in conjunction with subdivision 7 is higher than
it is when calculated under paragraph (b), in conjunction with
the provisions of subdivision 6. The retirement annuity formula
percentage for purposes of this paragraph is 1-1/2 1.5 percent
for each year of coordinated service.
Sec. 48. Minnesota Statutes 1989 Supplement, section
354A.31, subdivision 6, is amended to read:
Subd. 6. [REDUCED RETIREMENT ANNUITY.] This subdivision
applies only to a person who first became a coordinated
member or a member of a pension fund listed in section 356.30,
subdivision 3, before July 1, 1989, and whose annuity is higher
when calculated using the retirement annuity formula percentage
in subdivision (4) 4, paragraph (b), in conjunction with this
subdivision than when calculated under subdivision 4, paragraph
(c), in conjunction with subdivision 7.
(a) Upon retirement at an age prior to before normal
retirement age with three years of service credit or prior to
age 62 with at least 30 years of service credit, a coordinated
member shall be entitled to a retirement annuity in an amount
equal to the normal retirement annuity calculated using the
retirement annuity formula percentage in subdivision (4),
paragraph (b), reduced by one-quarter of one percent for each
month that the coordinated member is under normal retirement age
if the coordinated member has less than 30 years of service
credit or is under the age of 62 if the coordinated member has
at least 30 years of service credit.
(b) Any coordinated member whose attained age plus credited
allowable service totals 90 years is entitled, upon application,
to a retirement annuity in an amount equal to the normal
retirement annuity calculated using the retirement annuity
formula percentage in subdivision (4), paragraph (b), without
any reduction by reason of early retirement.
Sec. 49. Minnesota Statutes 1989 Supplement, section
354A.31, subdivision 7, is amended to read:
Subd. 7. [ACTUARIAL REDUCTION FOR EARLY RETIREMENT.] This
subdivision applies to a person who has become at least 55 years
old and first becomes a coordinated member after June 30, 1989,
and to any other coordinated member who has become at least 55
years old and whose annuity is higher when calculated using the
retirement annuity formula percentage in subdivision 4,
paragraph (c), in conjunction with this subdivision than when
calculated under subdivision 4, paragraph (b), in conjunction
with subdivision 6. A coordinated member who retires before the
full benefit age shall be paid the retirement annuity calculated
using the retirement annuity formula percentage in subdivision
4, paragraph (c), reduced so that the reduced annuity is the
actuarial equivalent of the annuity that would be payable to the
member if the member deferred receipt of the annuity and the
annuity amount were augmented at an annual rate of three percent
compounded annually from the day the annuity begins to accrue
until the normal retirement age.
Sec. 50. Minnesota Statutes 1989 Supplement, section
354A.32, subdivision 1, is amended to read:
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
that guarantees payment of the balance of the annuity
recipient's accumulated deductions to a designated beneficiary
upon the death of the annuity recipient. Except as provided in
subdivision 1a, 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 the commission-retained
actuary. The recommendation shall be a part of the permanent
records of the board.
Sec. 51. Minnesota Statutes 1989 Supplement, section
354A.32, subdivision 1a, is amended to read:
Subd. 1a. [BOUNCE-BACK ANNUITY.] (a) If a former
coordinated member or disabilitant has selected a joint and
survivor annuity option under subdivision 1, the former member
or disabilitant must receive a normal single life annuity if the
designated optional annuity beneficiary dies before the former
member or disabilitant. Under this option, no reduction may be
made in the person's annuity to provide for restoration of the
normal single life annuity in the event of the death of the
designated optional annuity beneficiary.
(b) A former coordinated member or disabilitant who
selected an optional joint and survivor annuity before July 1,
1989, but did not choose an option that provides that the normal
single life annuity is payable to the former member or the
disabilitant if the designated optional annuity beneficiary dies
first, is eligible for restoration of the normal single life
annuity if the designated optional annuity beneficiary dies
first, without further actuarial reduction of the person's
annuity. A former member or disabilitant who selected an
optional joint and survivor annuity, but whose designated
optional annuity beneficiary died before July 1, 1989, shall
receive a normal single life annuity after that date, but shall
not receive retroactive payments for periods before that date.
(c) A former coordinated member or disabilitant who took a
further actuarial reduction to elect an optional joint and
survivor annuity that provides that the normal annuity is
payable to the former member or disabilitant if the designated
optional beneficiary dies first but has not died before July 1,
1989, shall have the annuity increased as of July 1, 1989, to
the amount the person would have received if, at the time of
retirement or disability, the person had selected only optional
survivor coverage that would not have provided for restoration
of the normal annuity upon the death of the designated optional
annuity beneficiary. Any annuity or benefit increase under this
paragraph is effective only for payments made after June 30,
1989, and is not retroactive for payments made before July 1,
1989.
(d) The restoration of the normal single life annuity under
this subdivision will take effect on the first of the month
following the date of death of the designated optional annuity
beneficiary or on the first of the month following one year
before the date on which a certified copy of the death
certificate of the designated optional annuity beneficiary is
received in the office of the appropriate teachers retirement
fund association, whichever date is later.
Sec. 52. Minnesota Statutes 1989 Supplement, section
354B.02, subdivision 2, is amended to read:
Subd. 2. [PERSONS WITH CERTAIN PRIOR ALLOWABLE SERVICE.] A
person with less than three years of prior allowable service as
a member of the teachers retirement association other than in
covered employment under section 354B.01, subdivision 2 or 3,
and who is first employed in covered employment after June 30,
1989, may remain remains a member of the teacher's retirement
association for all purposes or, but a coordinated member may
elect to participate in the plan. This election to participate
in the plan must be made within 60 days of the start of covered
employment.
Sec. 53. Minnesota Statutes 1989 Supplement, section
354B.02, subdivision 3, is amended to read:
Subd. 3. [OPTIONAL PARTICIPATION.] A person with less than
three years of allowable service who was first employed in
covered employment before July 1, 1989, and who is a coordinated
member of the teachers retirement association, may elect to
transfer retirement coverage to the plan under section 6 354B.03.
The election must be made on a form provided by the executive
director. An election to transfer retirement coverage to the
plan must be made before July 1, 1992, and is irrevocable. When
a member transfers coverage to the plan, all existing service
credits with the association to which the person was entitled
before the transfer terminate and may not be restored.
Sec. 54. Minnesota Statutes 1989 Supplement, section
354B.03, subdivision 1, is amended to read:
Subdivision 1. [PROCEDURE TRANSFER.] If a person with less
than three years of allowable service elects a transfer to the
plan under section 354B.02, subdivision 2 or 3, the executive
director of the teachers retirement association shall transfer
from the teachers retirement fund to the plan the person's
member contributions plus interest compounded annually at five
percent a year. The transfer must be made within 90 days from
the date the executive director receives notification of the
election. The transfer may not include any amount representing
an employer contribution nor any amount representing the
repayment of a refund received by the association after the date
of enactment of this act.
Sec. 55. Minnesota Statutes 1989 Supplement, section
354B.03, subdivision 3, is amended to read:
Subd. 3. [ELECTION.] A person with more than three or more
years of allowable service credit who was first employed in
covered employment before July 1, 1989, or after June 30, 1989,
as provided in section 354B.02, subdivision 2, may elect
coverage by the plan before July 1, 1992. If coverage is
elected, accumulated employer and employee contributions and
allowable service credit shall must remain with the teachers
retirement fund and that person shall remain is eligible for a
deferred annuity from that fund augmented with interest at the
rate of five percent computed as specified in section 354.55,
subdivision 11. Future contributions only shall be made to the
plan. An election made under this subdivision is irrevocable.
Sec. 56. Minnesota Statutes 1988, section 356.302,
subdivision 3, is amended to read:
Subd. 3. [GENERAL EMPLOYEE PLAN ELIGIBILITY REQUIREMENTS.]
A disabled member of a covered retirement plan who has credit
for allowable service in a combination of general employee
retirement plans is entitled to a combined service disability
benefit if the member:
(1) is less than 65 years of age on the date of application
for the disability benefit;
(2) has become totally and permanently disabled;
(3) has credit for allowable service in any combination of
general employee retirement plans totaling at least five three
years;
(4) has credit for at least six months of allowable service
with the current general employee retirement plan before the
commencement of the disability;
(5) has at least five three continuous years of allowable
service credit by the general employee retirement plan or has at
least a total of five three years of allowable service credit by
a combination of general employee retirement plans in a 72-month
period during which no interruption of allowable service credit
from a termination of employment exceeded 29 days; and
(6) is not receiving a retirement annuity or disability
benefit from any covered general employee retirement plan at the
time of the commencement of the disability.
Sec. 57. Minnesota Statutes 1988, section 356.302,
subdivision 4, is amended to read:
Subd. 4. [PUBLIC SAFETY PLAN ELIGIBILITY REQUIREMENTS.] A
disabled member of a covered retirement plan who has credit for
allowable service in a combination of public safety employee
retirement plans is entitled to a combined service disability
benefit if the member:
(1) is less than 55 years of age old on the date of
application for the disability benefit;
(2) has become occupationally disabled;
(3) has credit for allowable service in any combination of
public safety employee retirement plans totaling at least one
year if the disability is duty-related or totaling at least five
three years if the disability is not duty-related;
(4) has credit for at least six months of allowable service
with the current public safety employee retirement plan before
the commencement of the disability; and
(5) is not receiving a retirement annuity or disability
benefit from any covered public safety employee retirement plan
at the time of the commencement of the disability.
Sec. 58. Minnesota Statutes 1989 Supplement, section
356.371, subdivision 3, is amended to read:
Subd. 3. [REQUIREMENT OF NOTICE TO MEMBER'S SPOUSE.] If a
public pension fund provides optional retirement annuity forms
which include a joint and survivor optional retirement annuity
form potentially applicable to the surviving spouse of a member,
the chief administrative officer of the public pension fund
shall send a copy of the written statement required by
subdivision 2 to the spouse of the member before the member's
election of an optional retirement annuity.
Following the election of an optional a retirement annuity
form by the member, a copy of the completed retirement annuity
application and retirement annuity beneficiary form must be sent
by the public pension fund to the spouse of the retiring
member. A signed acknowledgment must be required from the
spouse confirming receipt of a copy of the completed retirement
annuity application and retirement annuity beneficiary form. If
the required signed acknowledgment is not received from the
spouse within 30 days, the public pension fund must send another
copy of the completed retirement annuity application and
retirement annuity beneficiary form to the spouse by certified
mail.
Sec. 59. Minnesota Statutes 1989 Supplement, section
356.86, subdivision 2, is amended to read:
Subd. 2. [AMOUNT OF POSTRETIREMENT ADJUSTMENT; PAYMENT.]
(a) For any person receiving an annuity or benefit on November
30, 1989, and entitled to receive a postretirement adjustment
under subdivision 1, the postretirement adjustment is a lump sum
payment calculated under paragraph (b) or (c).
(b) For coordinated plan members annuity or benefit
recipients, the postretirement adjustment in 1989 is $25 for
each full year of allowable service credited to the person by
the respective retirement fund. In 1990 and each following
year, the postretirement adjustment is the amount payable in the
preceding year increased by the same percentage applied to
regular annuities paid from the postretirement fund or, for the
retirement funds specified in subdivision 3, clauses (6), (7),
and (8), by the same percentage applied under the articles of
incorporation and bylaws of these funds.
(c) For basic plan members annuity or benefit recipients,
the postretirement adjustment in 1989 is the greater of:
(1) $25 for each full year of allowable service credited to
the person by the respective retirement fund; or
(2) the difference between:
(i) the product of $400 times the number of full years of
allowable service credited to the person by the respective
retirement fund; and
(ii) the sum of the benefits payable to the person from any
Minnesota public employee pension plan, and cash benefits
payable to the person from the social security administration.
In 1990 and each following year, each eligible basic
plan member annuity or benefit recipient shall receive the
amount received in the preceding year increased by the same
percentage applied to regular annuities paid from the
postretirement fund or, for the retirement funds specified in
subdivision 3, clauses (6), (7), and (8), by the same percentage
applied under the articles of incorporation and bylaws of these
funds.
(d) The postretirement adjustment provided for in this
section is payable for those persons receiving an annuity or
benefit on November 30, 1989, on December 1, 1989. In
subsequent years, the adjustment must be paid on December 1,
unless the beneficiary to those persons receiving an annuity or
benefit on the preceding November 30. A person who is entitled
eligible may elect to participate in an optional annuity or
benefit receipt schedule under subdivision 4. This section does
not authorize the payment of a postretirement adjustment to an
estate if the annuity or benefit recipient dies before the
November 30 eligibility date. Notwithstanding section 356.18,
the postretirement adjustment provided for in this section must
be paid automatically unless the intended recipient files a
written notice with the retirement fund requesting that the
postretirement adjustment not be paid.
Sec. 60. Minnesota Statutes 1989 Supplement, section
356.86, subdivision 4, is amended to read:
Subd. 4. [OPTIONAL BENEFIT POSTRETIREMENT ADJUSTMENT
PAYMENT SCHEDULE.] Basic plan annuity or benefit recipients
receiving adjustments under subdivision 2, paragraph (c), clause
(2), and whose adjustment exceeds 20 percent of their Minnesota
plan annuity or benefit may elect to have the amount of the
benefit adjustment paid in equal monthly amounts instead of
receiving a benefit adjustment lump sum payment on December 1 of
each year, 1989. Selection of this option must be made by the
recipient in writing on forms prepared by the retirement
association. This option may be revoked by the recipient in
writing prior to November 1 preceding the December 1 lump sum
distribution. Upon the death of the annuity or benefit
recipient, any remaining unpaid monthly amounts shall be paid to
the surviving spouse, or if no spouse survives, to the annuity
or benefit recipient's beneficiary or estate.
Sec. 61. Minnesota Statutes 1989 Supplement, section
356.86, subdivision 5, is amended to read:
Subd. 5. [SOCIAL SECURITY INFORMATION.] To be eligible for
a benefit postretirement adjustment calculated under subdivision
2, paragraph (c), clause (2), a person must authorize the social
security administration to release to the retirement association
information on the person's social security cash benefits. This
authorization must be received by the retirement association
before the December 1, 1989, payment date.
Sec. 62. Minnesota Statutes 1989 Supplement, section
356.86, subdivision 6, is amended to read:
Subd. 6. [REPORT.] By September 30, 1990, the retirement
funds listed in subdivision 3 shall report to the legislature
and the commissioner of finance on the number of annuity and
benefit recipients eligible for each type of adjustment
established in subdivision 2, the annual cost of each type of
adjustment, and the estimated actuarial liability associated
with each.
Sec. 63. Laws 1989, chapter 319, article 19, section 7,
subdivision 4, is amended to read:
Subd. 4. [AMOUNT OF ANNUAL POSTRETIREMENT PAYMENT.] The
amount determined under subdivision 3 must be applied in
accordance with this subdivision. The relief association shall
apply the first one-half of one percent of assets which
constitute excess investment income to the payment of an annual
postretirement payment as specified in this subdivision. The
second one-half of one percent of assets which constitute excess
investment income shall be applied to reduce the state
amortization state aid or supplementary amortization state aid
payments otherwise due to the relief association under section
423A.02 for the current calendar year. The relief association
shall pay an annual postretirement payment to all eligible
members in an amount not to exceed one-half of one percent of
the assets of the fund. Payment of the annual postretirement
payment must be in a lump sum amount on June 1 following the
determination date in any year. Payment of the annual
postretirement payment may be made only if the time weighted
total rate of return exceeds by two percent the actual
percentage increase in the current monthly salary of a top grade
patrol officer or a top grade firefighter, whichever applies, in
the most recent fiscal year and the yearly average percentage
increase of the time weighted total rate of return of the fund
for the previous five years exceeds by two percent the yearly
average percentage increase in monthly salary of a top grade
patrol officer or a top grade firefighter, whichever applies, of
the previous five years. The total amount of all payments to
members may not exceed the amount determined under subdivision
3. Payment to each eligible member must be calculated by
dividing the total number of pension units to which eligible
members are entitled into the excess investment income available
for distribution to members, and then multiplying that result by
the number of units to which each eligible member is entitled to
determine each eligible member's annual postretirement payment.
Payment to each eligible member may not exceed an amount equal
to the total monthly benefit that the eligible member was
entitled to in the prior year under the terms of the benefit
plan of the relief association or each eligible member's
proportionate share of the excess investment income, whichever
is less.
Sec. 64. [REPEALER.]
Minnesota Statutes 1988, sections 11A.19, subdivisions 1,
2, 3, 4, 5, 6, 7, and 8; 354.05, subdivisions 23, 24, 33, and
34; 354.146, subdivision 2; and 354.62, subdivisions 1, 3, 4, 5,
and 6; Minnesota Statutes 1989 Supplement, sections 11A.19,
subdivision 9; 354.44, subdivision 7; and 354.62, subdivisions 2
and 7, are repealed.
Sec. 65. [EFFECTIVE DATE.]
Sections 1 to 64 are effective the day following final
enactment.
ARTICLE 13
PURCHASES OF CREDIT FOR PRIOR SERVICE
Section 1. [BUY-BACK OF PRIOR SERVICE CREDIT.]
Subdivision 1. [MILITARY AFFAIRS.] A person who was
employed by the department of military affairs between April 14,
1967, and December 31, 1974, may purchase service credit from
the Minnesota state retirement system for periods of that
employment for which allowable service credit has not been
obtained.
Subd. 2. [ST. CLOUD CITY COUNCIL.] A person who began
service as an elected member of the St. Cloud city council on
April 20, 1980, and who began participating in the public
employees retirement association on February 19, 1989, may
purchase credit for prior service as an elected member of the
city council from April 20, 1980, to February 18, 1989.
Subd. 3. [AITKIN COUNTY OFFICIAL.] A member of the public
employees retirement association with prior service as an
elected county official in Aitkin county between January 4,
1971, and December 31, 1975, may purchase allowable service
credit in the association for that period of service.
Subd. 4. [ST. LOUIS PARK.] A person who was born on July
31, 1927, who is the city attorney for the city of Brooklyn
Park, and who was a member of the city council for the city of
St. Louis Park from January 1, 1960, to January 1, 1968, is
entitled to purchase credit from the public employees retirement
association for that period of service if not otherwise credited
as allowable service by the association.
Subd. 5. [PURCHASE.] Notwithstanding Minnesota Statutes,
section 352.01, subdivision 11, any member of the Minnesota
state retirement system currently employed by the Willmar
Regional Treatment Center who left state service to attend the
University of Michigan, Ann Arbor, between February 1966 and
April 1968 may obtain allowable service credit for that period.
Subd. 6. [PERA.] A basic member of the public employees
retirement association who was employed by the city of White
Bear Lake from March 1, 1966, to February 1979, employed by the
metropolitan transit commission on February 23, 1979, and who
received a reduced salary based on service with the metropolitan
transit commission between November 4, 1987, and March 1, 1988,
may elect to exclude that service from calculation of the
highest five successive years average salary used to determine
the person's annuity from the public employees retirement
association.
Subd. 7. [PURCHASE PAYMENT AMOUNT.] To purchase credit for
prior service under subdivisions 1 to 5 there must be paid to
the applicable fund an amount equal to the present value, on the
date of payment, of the amount of the additional retirement
annuity obtained by the purchase of the additional service
credit. To make an exclusion under subdivision 6, there must be
paid to the public employees retirement association an amount
equal to the difference in the present value, on the date of
payment, of the additional retirement annuity obtained by the
exclusion of service between November 4, 1987, and March 1,
1988, from calculation of the highest five successive years
average salary. Calculation of this amount must be made using
the applicable preretirement interest rate specified in
Minnesota Statutes, section 356.215, subdivision 4d, and the
mortality table adopted for the fund. The calculation must
assume continuous future service in the association until, and
retirement at, the age at which the minimum requirements of the
retirement association for normal retirement or retirement with
an annuity unreduced for retirement at an early age, including
Minnesota Statutes, section 356.30, are met with the additional
service credit purchased. The calculation must also assume a
future salary history that includes annual salary increases at
the salary increase rate specified in section 356.215,
subdivision 4d. The person requesting the purchase of prior
service shall establish in the records of the fund or
association sufficient proof of the service for which the
purchase of prior service is requested. The manner of the proof
of service must be in accordance with procedures prescribed by
the executive director of the association.
Subd. 8. [PAYMENT; CREDITING SERVICE.] Payment must be
made in one lump sum, unless the executive director of the fund
or association agrees to accept payment in installments over a
period 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 may be credited to
the account of the person or the period of service excluded from
calculation of the high five only after receipt of full payment
by the executive director.
Subd. 9. [OPTIONAL EMPLOYER PARTIAL PAYMENT.] Payment is
the obligation of the person entitled to purchase credit for the
prior service. However, the current or former employer of a
person specified in subdivisions 1 to 6 may, at its discretion,
pay all or any portion of the payment amount that exceeds an
amount equal to the employee contribution rates in effect during
the period of prior service applied to the actual salary rates
in effect during the period of prior service, plus interest at
the rate of six percent a year compounded annually from the date
on which the contributions would otherwise have been made to the
date on which the payment is made.
Sec. 2. [EFFECTIVE DATE.]
Section 1 is effective the day following final enactment.
ARTICLE 14
MISCELLANEOUS RETIREMENT PROVISIONS
Section 1. Minnesota Statutes 1988, section 424A.02,
subdivision 3, is amended to read:
Subd. 3. [FLEXIBLE SERVICE PENSION MAXIMUMS.] On or before
August 1 of each year as part of the certification of the
financial requirements and minimum municipal obligation made
pursuant to section 69.772, subdivision 4, or 69.773,
subdivision 5, the secretary or some other official of the
relief association designated in the bylaws of each relief
association shall calculate and certify to the governing body of
the applicable qualified municipality the average amount of
available financing per active covered firefighter for the most
recent three-year period. The amount of available financing
shall include any amounts of fire state aid received or
receivable by the relief association, any amounts of municipal
contributions to the relief association raised from levies on
real estate or from other available revenue sources exclusive of
fire state aid, and one-tenth of the amount of assets in excess
of the accrued liabilities of the relief association calculated
pursuant to sections 69.772, subdivision 2; 69.773, subdivisions
2 and 4; or 69.774, subdivision 2, if any. The maximum service
pension which the relief association may provide for in its
bylaws for payment to a member retiring after the calculation
date when the minimum age and service requirements specified in
subdivision 1 are met shall be determined using the applicable
following table.
For a relief association where the governing bylaws provide
for a monthly service pension to a retiring member, if the
average amount of available financing per active covered
firefighter does not exceed the minimum average amount specified
below, then the maximum monthly service pension amount per month
for each year of service credited which may be provided for in
the bylaws shall be the greater of: (1) the service pension
amount provided for in the bylaws on the date of calculation; or
(2) the maximum service pension figure corresponding to the
average amount of available financing per active covered
firefighter:
Minimum Average Amount of Maximum Service Pension
Available Financing per Amount Payable per Month
Firefighter for Each Year of Service
$... $ .25
37 .50
75 1.00
112 1.50
149 2.00
186 2.50
224 3.00
261 3.50
298 4.00
336 4.50
373 5.00
447 6.00
522 7.00
597 8.00
671 9.00
746 10.00
820 11.00
895 12.00
969 13.00
1044 14.00
1119 15.00
1193 16.00
1268 17.00
1342 18.00
1417 19.00
1491 20.00
1566 21.00
1640 22.00
1678 or more 22.50
1715 23.00
1790 24.00
1865 25.00
1940 26.00
2015 27.00
2090 28.00
2165 29.00
2240 or more 30.00
For a relief association in which the governing bylaws
provide for a lump sum service pension to a retiring member, if
the average amount of available financing per active covered
firefighter does not exceed the minimum average amount specified
below, then the maximum lump sum service pension amount for each
year of service credited which may be provided for in the bylaws
shall be the greater of: (1) the service pension amount
provided for in the bylaws on the date of the calculation; or
(2) the maximum service pension figure corresponding to the
average amount of available financing per active covered
firefighter:
Minimum Average Amount Maximum Lump Sum Service
of Available Financing Pension Amount Payable
per Firefighter for Each Year of Service
$.. $10
10 20
14 30
20 40
24 50
28 60
38 80
48 100
58 120
68 140
76 160
86 180
96 200
116 240
134 280
154 320
172 360
192 400
212 440
230 480
250 520
268 560
288 600
308 640
326 680
346 720
364 760
384 800
432 900
480 1000
528 1100
576 1200
624 1300
672 1400
720 1500
768 1600
816 1700
864 1800
912 1900
960 2000
1008 2100
1056 2200
1104 2300
1152 2400
1200 2500
1248 2600
1296 2700
1344 2800
1392 2900
1440 or more 3000
For a relief association in which the governing bylaws
provide for a monthly benefit service pension as an alternative
form of service pension payment to a lump sum service pension at
the option of the retiring member, the maximum service pension
amount shall be determined using the applicable table contained
in this subdivision.
Sec. 2. [REPEAL OF REDUNDANT POSTRETIREMENT ADJUSTMENT.]
Subdivision 1. Laws 1989, chapter 335, article 1, section
50, is repealed.
Subd. 2. This section is effective retroactively to July
1, 1989.
Sec. 3. Laws 1989, chapter 319, article 17, section 18, is
amended to read:
Sec. 18. [EFFECTIVE DATE.]
Sections 1 to 17 15 are effective July 1, 1989. Sections
16 and 17 are effective May 16, 1989.
Sec. 4. [EFFECTIVE DATE.]
Sections 1 and 3 are effective on the day following final
enactment.
Presented to the governor April 26, 1990
Signed by the governor May 8, 1990, 8:30 p.m.
Official Publication of the State of Minnesota
Revisor of Statutes