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Minnesota Legislature

Office of the Revisor of Statutes

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

  
    Laws of Minnesota 1993 

                        CHAPTER 244-S.F.No. 853 
           An act relating to retirement; volunteer firefighters' 
          relief associations; increasing service pension 
          maximums; establishing a fire state aid maximum 
          apportionment; providing penalties for noncompliance 
          with service pension maximums; specifying duties for 
          the state auditor; ratifying certain prior 
          nonconforming lump sum service pension payments; 
          continuing certain nonconforming lump sum service 
          pension amounts in force; modifying certain investment 
          performance calculations; modifying certain local 
          volunteer firefighters relief association provisions; 
          prohibiting the use of lawful gambling contributions 
          for pensions; amending Minnesota Statutes 1992, 
          sections 11A.04; 349.12, subdivision 25; 356.218, 
          subdivisions 2 and 3; and 424A.02, subdivisions 1, 3, 
          and by adding subdivisions; Laws 1971, chapter 140, 
          section 5, as amended; proposing coding for new law in 
          Minnesota Statutes, chapter 471.  
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 

                               ARTICLE 1 

                     VOLUNTEER FIRE BENEFIT CHANGES 
    Section 1.  Minnesota Statutes 1992, section 424A.02, 
subdivision 1, is amended to read: 
    Subdivision 1.  [AUTHORIZATION.] A relief association, when 
its articles of incorporation or bylaws so provide, may pay out 
of the assets of its special fund a service pension to each of 
its members who:  (1) separates from active service with the 
fire department; (2) reaches age 50; (3) completes at least five 
years of active service as an active member of the municipal 
fire department to which the relief association is associated; 
(4) completes at least five years of active membership with the 
relief association before separation from active service; and 
(5) complies with any additional conditions as to age, service, 
and membership that are prescribed by the bylaws of the relief 
association.  A service pension computed under this section may 
be prorated monthly for fractional years of service, if the 
bylaws or articles of incorporation of the relief association so 
provide.  The service pension may be paid whether or not the 
municipality or nonprofit firefighting corporation to which the 
relief association is associated qualifies for fire state aid 
under chapter 69.  In the case of a member who has completed at 
least five years of active service as an active member of the 
fire department to which the relief association is associated on 
the date that the relief association is established and 
incorporated, the requirement that the member complete at least 
five years of active membership with the relief association 
before separation from active service may be waived by the board 
of trustees of the relief association if the member completes at 
least five years of inactive membership with the relief 
association before the payment of the service pension.  During 
the period of inactive membership, the member is not entitled to 
receive disability benefit coverage, is not entitled to receive 
additional service credit towards computation of a service 
pension, and is considered to have the status of a person 
entitled to a deferred service pension under subdivision 7. 
     No municipality or nonprofit firefighting corporation may 
delegate the power to take final action in setting a service 
pension or ancillary benefit amount or level to the board of 
trustees of the relief association or to approve in advance a 
service pension or ancillary benefit amount or level equal to 
the maximum amount or level that this chapter would allow rather 
than a specific dollar amount or level.  
     No relief association as defined in section 424A.001, 
subdivision 4, may pay a service pension or disability benefit 
to a former member of the relief association if that person has 
not separated from active service with the fire department to 
which the relief association is directly associated.  
     For the purposes of this chapter, "to separate from active 
service" means to cease to perform fire suppression duties and 
to cease to supervise fire suppression duties. 
    Sec. 2.  Minnesota Statutes 1992, section 424A.02, 
subdivision 3, is amended to read: 
    Subd. 3.  [FLEXIBLE SERVICE PENSION MAXIMUMS.] (a) 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.  
    (b) The maximum service pension which the relief 
association may has authority to 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 must be determined using the applicable following 
table in paragraph (c) or (d), whichever applies. 
    (c) 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 that 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) is 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   42                          .50
           75   84                         1.00
          112  126                         1.50
          149  168                         2.00
          186  209                         2.50
          224  252                         3.00
          261  294                         3.50
          298  335                         4.00
          336  378                         4.50
          373  420                         5.00
          447  503                         6.00
          522  587                         7.00
          597  672                         8.00
          671  755                         9.00
          746  839                        10.00
          820  923                        11.00
          895 1007                        12.00
          969 1090                        13.00
         1044 1175                        14.00
         1119 1259                        15.00
         1193 1342                        16.00
         1268 1427                        17.00
         1342 1510                        18.00
         1417 1594                        19.00
         1491 1677                        20.00
         1566 1762                        21.00
         1640 1845                        22.00
         1678 1888                        22.50
         1715 1929                        23.00
         1790 2014                        24.00
         1865 2098                        25.00
         1940 2183                        26.00
         2015 2267                        27.00
         2090 2351                        28.00
         2165 2436                        29.00
         2240 or more 2520                30.00
         any amount more than 2520        30.00
    (d) 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 that 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) is the maximum service pension figure corresponding to the 
average amount of available financing per active covered 
firefighter for the applicable specified period: 
 Minimum Average Amount         Maximum Lump Sum Service
 of Available Financing         Pension Amount Payable
    per Firefighter             for Each Year of Service
   (1) for service pensions payable before January 1, 1994 
         $..                            $10
          10   11                        20
          14   16                        30
          20   23                        40
          24   27                        50
          28   32                        60
          38   43                        80
          48   54                       100
          58   65                       120
          68   77                       140
          76   86                       160
          86   97                       180
          96  108                       200
         116  131                       240
         134  151                       280
         154  173                       320
         172  194                       360
         192  216                       400
         212  239                       440
         230  259                       480
         250  281                       520
         268  302                       560
         288  324                       600
         308  347                       640
         326  367                       680
         346  389                       720
         364  410                       760
         384  432                       800
         432  486                       900
         480  540                      1000
         528  594                      1100
         576  648                      1200
         624  702                      1300
         672  756                      1400
         720  810                      1500
         768  864                      1600
         816  918                      1700
         864  972                      1800
         912 1026                      1900
         960 1080                      2000
        1008 1134                      2100
        1056 1188                      2200
        1104 1242                      2300
        1152 1296                      2400
        1200 1350                      2500
        1248 1404                      2600
        1296 1458                      2700
        1344 1512                      2800
        1392 1566                      2900
        1440 or more 1620              3000
        1672                           3100
        1726                           3200
        1753                           3250
        1780                           3300
        1820                           3375
        any amount more than 1820      3375
    (2) in addition to the service pension maximum under clause 
(1), for service pensions payable after December 31, 1993, and 
before January 1, 1995 
        1834                           3400
        1888                           3500
        any amount more than 1888      3500
    (3) in addition to the service pension maximum under 
clauses (1) and (2), for service pensions payable after December 
31, 1994, and before January 1, 1996 
        1942                           3600
        1996                           3700
        2023                           3750
        any amount more than 2023      3750
    (4) in addition to the service pension maximum under 
clauses (1) to (3), for service pensions payable after December 
31, 1995 
        2050                           3800
        2104                           3900
        2158                           4000
        any amount more than 2158      4000
    (e) 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 for each pension payment type must be determined 
using the applicable table contained in this subdivision. 
    (f) If a relief association establishes a service pension 
in compliance with the applicable maximum contained in paragraph 
(c) or (d) and the minimum average amount of available financing 
per active covered firefighter is subsequently reduced because 
of a reduction in fire state aid or because of an increase in 
the number of active firefighters, the relief association may 
continue to provide the prior service pension amount specified 
in its bylaws, but may not increase the service pension amount 
until the minimum average amount of available financing per 
firefighter under the table in paragraph (c) or (d), whichever 
applies, permits. 
    (g) No relief association is authorized to provide a 
service pension in an amount greater than $30 per month per year 
of service credit or in an amount greater than $3,375 lump sum 
per year of service credit before January 1, 1994, $3,500 lump 
sum per year of service credit before January 1, 1995, $3,750 
lump sum per year of service credit before January 1, 1996, and 
$4,000 lump sum per year of service credit after December 31, 
1995, even if the minimum average amount of available financing 
per firefighter for a relief association providing a monthly 
benefit service pension is greater than $2,240, or, for a relief 
association providing a lump sum service pension, is greater 
than $1,753 before January 1, 1994, $1,888 before January 1, 
1995, $2,023 before January 1, 1996, or $2,158 after December 
31, 1995. 
    Sec. 3.  Minnesota Statutes 1992, section 424A.02, is 
amended by adding a subdivision to read: 
    Subd. 3a.  [PENALTY FOR PAYING PENSION GREATER THAN 
APPLICABLE MAXIMUM.] (a) If a relief association pays a service 
pension greater than the maximum service pension associated with 
the applicable average amount of available financing per active 
covered firefighter under the table in subdivision 3, paragraph 
(c) or (d), whichever applies, the maximum service pension under 
subdivision 3, paragraph (f), or the applicable maximum service 
pension amount specified in subdivision 3, paragraph (g), 
whichever is less, the state auditor shall: 
    (1) disqualify the municipality or the nonprofit 
firefighting corporation associated with the relief association 
from receiving fire state aid by making the appropriate 
notification to the municipality and the commissioner of 
revenue, with the disqualification applicable for the next 
apportionment and payment of fire state aid; and 
    (2) recover the amount of the overpaid service pension or 
pensions from any retired firefighter who received an 
overpayment. 
    (b) Fire state aid amounts from disqualified municipalities 
for the period of disqualifications under paragraph (a), clause 
(1), must be credited to the amount of fire insurance premium 
tax proceeds available for the next subsequent fire state aid 
apportionment. 
    (c) The amount of any overpaid service pension recovered 
under paragraph (a), clause (2), must be credited to the amount 
of fire insurance premium tax proceeds available for the next 
subsequent fire state aid apportionment. 
    (d) The determination of the state auditor that a relief 
association has paid a service pension greater than the 
applicable maximum must be made on the basis of the information 
filed by the relief association and the municipality with the 
state auditor under sections 69.011, subdivision 2, and 69.051, 
subdivision 1 or 1a, whichever applies, and any other relevant 
information that comes to the attention of the state auditor.  
The determination of the state auditor is final.  An aggrieved 
municipality, relief association, or person may appeal the 
determination under section 480A.06.  
    Sec. 4.  [VALIDATION OF PRIOR PAYMENTS; AUTHORITY TO RETAIN 
CERTAIN SERVICE PENSION AMOUNTS.] 
    (a) Payments of lump sum service pensions by volunteer 
firefighter relief associations before March 15, 1992, that were 
in excess of the uppermost flexible service pension maximum 
amount specified in Minnesota Statutes, section 424A.02, 
subdivision 3, but were in conformance with the articles of 
incorporation or bylaws of the relief association in effect on 
the day before the payment of the lump sum service pension, are 
ratified. 
    (b) A lump sum service pension amount in excess of the 
uppermost flexible service pension maximum amount specified in 
Minnesota Statutes 1990, section 424A.02, subdivision 3, and in 
excess of the applicable lump sum service pension maximum amount 
specified in section 424A.02, subdivision 3, as specified in the 
articles of incorporation or bylaws of a relief association in 
effect on December 31, 1991, may continue in force after 
December 31, 1991, but may not be subsequently increased except 
in conformance with section 424A.02, subdivision 3. 
    Sec. 5.  [EFFECTIVE DATE.] 
    Sections 1 to 4 are effective the day following final 
enactment. 

                               ARTICLE 2 

            VOLUNTEER FIRE INVESTMENT PERFORMANCE REPORTING 
    Section 1.  Minnesota Statutes 1992, section 11A.04, is 
amended to read: 
    11A.04 [DUTIES AND POWERS.] 
    The state board shall: 
    (1) Act as trustees for each fund for which it invests or 
manages money in accordance with the standard of care set forth 
in section 11A.09 if state assets are involved and in accordance 
with chapter 356A if pension assets are involved. 
    (2) Formulate policies and procedures deemed necessary and 
appropriate to carry out its functions.  Procedures adopted by 
the board must allow fund beneficiaries and members of the 
public to become informed of proposed board actions.  Procedures 
and policies of the board are not subject to the administrative 
procedure act. 
     (3) Employ an executive director as provided in section 
11A.07. 
     (4) Employ investment advisors and consultants as it deems 
necessary. 
     (5) Prescribe policies concerning personal investments of 
all employees of the board to prevent conflicts of interest. 
     (6) Maintain a record of its proceedings. 
     (7) As it deems necessary, establish advisory committees 
subject to section 15.059 to assist the board in carrying out 
its duties. 
     (8) Not permit state funds to be used for the underwriting 
or direct purchase of municipal securities from the issuer or 
the issuer's agent. 
    (9) Direct the state treasurer to sell property other than 
money that has escheated to the state when the board determines 
that sale of the property is in the best interest of the state.  
Escheated property must be sold to the highest bidder in the 
manner and upon terms and conditions prescribed by the board. 
    (10) Undertake any other activities necessary to implement 
the duties and powers set forth in this section. 
    (11) Establish a formula or formulas to measure management 
performance and return on investment.  Except as provided by 
section 356.218, public pension funds in the state shall utilize 
the formula or formulas developed by the state board. 
    (12) Except as otherwise provided in article XI, section 8, 
of the constitution of the state of Minnesota, employ, at its 
discretion, qualified private firms to invest and manage the 
assets of funds over which the state board has investment 
management responsibility.  There is annually appropriated to 
the state board, from the assets of the funds for which the 
state board utilizes a private investment manager, sums 
sufficient to pay the costs of employing private firms.  Each 
year, by January 15, the board shall report to the governor and 
legislature on the cost and the investment performance of each 
investment manager employed by the board.  
    (13) Adopt an investment policy statement that includes 
investment objectives, asset allocation, and the investment 
management structure for the retirement fund assets under its 
control.  The statement may be revised at the discretion of the 
state board.  The state board shall seek the advice of the 
council regarding its investment policy statement.  Adoption of 
the statement is not subject to chapter 14. 
    Sec. 2.  Minnesota Statutes 1992, section 356.218, 
subdivision 2, is amended to read: 
    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.  A volunteer firefighters' relief 
association governed by sections 69.771 to 69.775, that has 
assets with a book value of at least $500,000 but less than or 
equal to $2,000,000 as of the end of the preceding plan year, 
shall use the formula identified in subdivision 3, paragraph 
(b), clause (1), or the formula described in subdivision 3, 
paragraph (b), clause (2), as the relief association elects.  
Other covered public pension plans shall utilize the formula 
identified in subdivision 3, paragraph (b), clause (1). 
    Sec. 3.  Minnesota Statutes 1992, section 356.218, 
subdivision 3, is amended to read: 
    Subd. 3.  [CONTENTS OF THE INVESTMENT PERFORMANCE REPORT.] 
(a) 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.  
    (b) The time-weighted rate of return results must be 
computed using market values and the applicable procedure, as 
follows: 
    (1) by the formula or formulas prescribed by the state 
board of investment under section 11A.04, clause (11).; or 
    (2) by dividing the total investment gain or loss for the 
quarter by average assets for the quarter, if: 
    (i) the total investment gain or loss for the quarter is 
computed by subtracting the beginning market value for the 
quarter and the net contributions for the quarter from the 
ending market value for the quarter; 
    (ii) the measure of average assets to be used is the 
beginning market value for the quarter plus one-half the net 
contributions for the quarter; and 
    (iii) the resulting quarterly returns for each significant 
asset class and for the portfolio as a whole must be used to 
create annual time-weighted returns according to the same 
procedures for developing annual time-weighted returns from 
quarterly returns, as used in the formula specified by the state 
board of investment under section 11A.04, clause (11). 
    (c) The person performing the calculations shall certify 
conformance to that formula or those formulas the applicable 
procedure.  
    (d) 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.  
    (e) 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. 4.  [EFFECTIVE DATE.] 
    Sections 1 to 3 are effective July 1, 1993. 

                                ARTICLE 3 

             TRANSFERS TO OTHER TAX QUALIFIED PENSION PLANS 
    Section 1.  Minnesota Statutes 1992, section 424A.02, is 
amended by adding a subdivision to read: 
    Subd. 8b.  [TRANSFER TO INDIVIDUAL RETIREMENT ACCOUNT.] A 
relief association that is a qualified pension plan under 
section 401(a) of the federal internal revenue code, as amended, 
and that provides a lump sum service pension, at the written 
request of a retiring member, may directly transfer the eligible 
member's lump sum pension to the member's individual retirement 
account under section 408(a) of the federal internal revenue 
code, as amended. 
    Sec. 2.  [EFFECTIVE DATE.] 
    Section 1 is effective the day following final enactment. 

                                ARTICLE 4

            LOCAL VOLUNTEER FIRE RELIEF ASSOCIATION PROVISIONS
    Section 1.  Laws 1971, chapter 140, section 5, as amended 
by Laws 1973, chapter 30, section 5, is amended to read: 
    Sec. 5.  [GOLDEN VALLEY VOLUNTEER FIREFIGHTERS' RELIEF 
ASSOCIATION; FUNERAL BENEFIT COVERAGE.] 
    Subdivision 1.  [BENEFIT AUTHORIZATION.] Notwithstanding 
any provision of law to the contrary, the bylaws of 
the firemen's volunteer firefighters' relief association in the 
village city of Golden Valley may provide for a funeral 
benefit not to exceed $1,500 in case of death of a retired, 
disabled, or active fireman firefighter.  The amount of the 
funeral benefit payable on account of any deceased active, 
disabled, or retired firefighter may not exceed $1,500. 
    Provided further, in the case of a member receiving an 
early retirement service pension or an early retirement service 
transfer pension under section 1, subdivision 2 or 3, and who 
has been had credit for a period as a member of the association 
for a period of not less than five years, the funeral 
benefit shall be in the is an amount of $100 for each year of 
service exceeding five and with a maximum benefit of $1,500. 
    Subd. 2.  [ADDITIONAL FUNDING REQUIREMENT FOR FUNERAL 
BENEFIT COVERAGE.] In addition to the determination of the 
accrued liability of the relief association under Minnesota 
Statutes, section 69.772, subdivision 2, the officers of the 
relief association shall determine an additional accrued 
liability for the funeral benefit coverage under subdivision 1.  
The additional accrued liability is an amount equal to ten 
percent of the accrued liability determined under Minnesota 
Statutes, section 69.772, subdivision 2.  In calculating the 
financial requirements of the relief association and the minimum 
obligation of the municipality under Minnesota Statutes, section 
69.772, subdivision 3, the additional accrued liability for this 
benefit coverage must be added to the results determined under 
Minnesota Statutes, section 69.772, subdivisions 2 and 2a. 
    Sec. 2.  [RATIFICATION OF PRIOR FUNERAL BENEFIT PAYMENTS.] 
    Any funeral benefit payment made between March 27, 1973, 
and the effective date of this section, that was in conformance 
with the bylaws of the Golden Valley volunteer firefighters' 
relief association at the time of the payment, but that was in 
excess of the amount authorized under Laws 1973, chapter 30, 
section 5, before this amendment is ratified by this section. 
     Sec. 3.  [ELLENDALE FIRE DEPARTMENT RELIEF ASSOCIATION 
BENEFIT AND AID USE RATIFICATION.] 
    Subdivision 1.  [BENEFIT RATIFICATION.] Notwithstanding 
Minnesota Statutes, section 424A.02, subdivision 1, or any 
opinion of the office of the state auditor to the contrary, 
benefit payments made to retiring members of the Ellendale fire 
department relief association prior to the effective date of 
this section are ratified. 
    Subd. 2.  [AID USAGE RATIFICATION.] Notwithstanding 
Minnesota Statutes, sections 69.021, 424A.05, 424A.08, or prior 
laws governing the allocation or use of fire state aid, any 
allocation or use of fire state aid received by the firetown of 
Ellendale prior to the effective date of this section is hereby 
ratified providing the aid was used for a fire related purpose 
or as funding for the special fund of the Ellendale fire 
department relief association. 
     Sec. 4.  [EFFECTIVE DATE; LOCAL APPROVAL.] 
    Sections 1 and 2 are effective the day following approval 
by the governing body of the city of Golden Valley and 
compliance with Minnesota Statutes, section 645.021, subdivision 
3.  Section 3 is effective the day following approval by the 
governing body of the city of Ellendale and compliance with 
Minnesota Statutes, section 645.021, subdivision 3. 

                                ARTICLE 5

                         PROHIBITION OF USE OF

               LAWFUL GAMBLING CONTRIBUTIONS FOR PENSIONS
    Section 1.  Minnesota Statutes 1992, section 349.12, 
subdivision 25, is amended to read: 
    Subd. 25.  (a) "Lawful purpose" means one or more of the 
following:  
    (1) any expenditure by or contribution to a 501(c)(3) 
organization, provided that the organization and expenditure or 
contribution are in conformity with standards prescribed by the 
board under section 349.154; 
    (2) a contribution to an individual or family suffering 
from poverty, homelessness, or physical or mental disability, 
which is used to relieve the effects of that poverty, 
homelessness, or disability; 
    (3) a contribution to an individual for treatment for 
delayed posttraumatic stress syndrome or a contribution to a 
recognized program for the treatment of compulsive gambling on 
behalf of an individual who is a compulsive gambler; 
    (4) a contribution to or expenditure on a public or private 
nonprofit educational institution registered with or accredited 
by this state or any other state; 
    (5) a contribution to a scholarship fund for defraying the 
cost of education to individuals where the funds are awarded 
through an open and fair selection process; 
    (6) activities by an organization or a government entity 
which recognize humanitarian or military service to the United 
States, the state of Minnesota, or a community, subject to rules 
of the board; 
     (7) recreational, community, and athletic facilities and 
activities intended primarily for persons under age 21, provided 
that such facilities and activities do not discriminate on the 
basis of gender, as evidenced by (i) provision of equipment and 
supplies, (ii) scheduling of activities, including games and 
practice times, (iii) supply and assignment of coaches or other 
adult supervisors, (iv) provision and availability of support 
facilities, and (v) whether the opportunity to participate 
reflects each gender's demonstrated interest in the activity, 
provided that nothing in this clause prohibits a contribution to 
or expenditure on an educational institution or other entity 
that is excepted from the prohibition against discrimination 
based on sex contained in the Higher Education Act Amendments of 
1976, United States Code, title 20, section 1681; 
     (8) payment of local taxes authorized under this chapter, 
taxes imposed by the United States on receipts from lawful 
gambling, and the tax imposed by section 349.212, subdivisions 1 
and 4, and the tax imposed on unrelated business income by 
section 290.05, subdivision 3; 
     (9) payment of real estate taxes and assessments on 
licensed gambling premises wholly owned by the licensed 
organization paying the taxes, not to exceed: 
     (i) the amount which an organization may expend under board 
rule on rent for premises used for bingo; or 
     (ii) $15,000 per year for premises used for other forms of 
lawful gambling; 
      (10) a contribution to the United States, this state or any 
of its political subdivisions, or any agency or instrumentality 
thereof other than a direct contribution to a law enforcement or 
prosecutorial agency; 
     (11) a contribution to or expenditure by a nonprofit 
organization, church, or body of communicants gathered in common 
membership for mutual support and edification in piety, worship, 
or religious observances; or 
     (12) payment of one-half of the reasonable costs of an 
audit required in section 349.19, subdivision 9. 
     (b) Notwithstanding paragraph (a), "lawful purpose" does 
not include: 
     (1) any expenditure made or incurred for the purpose of 
influencing the nomination or election of a candidate for public 
office or for the purpose of promoting or defeating a ballot 
question; 
     (2) any activity intended to influence an election or a 
governmental decision-making process; 
     (3) the erection, acquisition, improvement, expansion, 
repair, or maintenance of real property or capital assets owned 
or leased by an organization, except as provided in clause (6), 
unless the board has first specifically authorized the 
expenditures after finding that (i) the real property or capital 
assets will be used exclusively for one or more of the purposes 
in paragraph (a); (ii) with respect to expenditures for repair 
or maintenance only, that the property is or will be used 
extensively as a meeting place or event location by other 
nonprofit organizations or community or service groups and that 
no rental fee is charged for the use; (iii) with respect to 
expenditures, including a mortgage payment or other debt service 
payment, for erection or acquisition only, that the erection or 
acquisition is necessary to replace with a comparable building, 
a building owned by the organization and destroyed or made 
uninhabitable by fire or natural disaster, provided that the 
expenditure may be only for that part of the replacement cost 
not reimbursed by insurance; or (iv) with respect to 
expenditures, including a mortgage payment or other debt service 
payment, for erection or acquisition only, that the erection or 
acquisition is necessary to replace with a comparable building a 
building owned by the organization that was acquired from the 
organization by eminent domain or sold by the organization to a 
purchaser that the organization reasonably believed would 
otherwise have acquired the building by eminent domain, provided 
that the expenditure may be only for that part of the 
replacement cost that exceeds the compensation received by the 
organization for the building being replaced; 
    (4) an expenditure by an organization which is a 
contribution to a parent organization, foundation, or affiliate 
of the contributing organization, if the parent organization, 
foundation, or affiliate has provided to the contributing 
organization within one year of the contribution any money, 
grants, property, or other thing of value; 
    (5) a contribution by a licensed organization to another 
licensed organization unless the board has specifically 
authorized the contribution.  The board must authorize such a 
contribution when requested to do so by the contributing 
organization unless it makes an affirmative finding that the 
contribution will not be used by the recipient organization for 
one or more of the purposes in paragraph (a); or 
    (6) the erection, acquisition, improvement, or expansion of 
real property or capital assets which will be used for one or 
more of the purposes in paragraph (a), clause (7), unless the 
organization making the expenditures notifies the board at least 
15 days before making the expenditure; or 
    (7) a contribution to a statutory or home rule charter 
city, county, or town by a licensed organization with the 
knowledge that the governmental unit intends to use the 
contribution for a pension or retirement fund. 
    Sec. 2.  [471.6151] [CONTRIBUTIONS FROM LAWFUL GAMBLING 
ORGANIZATIONS.] 
    Contributions of receipts derived from lawful gambling to a 
statutory or home rule charter city, county, or town made by an 
organization licensed to conduct lawful gambling under chapter 
349 may not be used for the benefit of a pension or retirement 
fund. 
    Sec. 3.  [EFFECTIVE DATE.] 
    Sections 1 and 2 are effective the day following final 
enactment. 
    Presented to the governor May 14, 1993 
    Signed by the governor May 17, 1993, 4:52 p.m.