Minnesota Session Laws - 1994, Regular Session

                            CHAPTER 541-H.F.No. 2839 
                  An act relating to retirement; changing employer 
                  contribution rates for the volunteer fire relief 
                  associations paying monthly pensions; changing 
                  employer contribution rates for the Bloomington fire 
                  relief association; clarifying probationary employment 
                  for South St. Paul police relief association; amending 
                  Minnesota Statutes 1992, section 69.773, subdivision 4.
        BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
           Section 1.  Minnesota Statutes 1992, section 69.773, 
        subdivision 4, is amended to read: 
           Subd. 4.  [FINANCIAL REQUIREMENTS OF THE SPECIAL FUND.] 
        Prior to August 1 of each year, the officers of the relief 
        association shall determine the financial requirements of the 
        special fund of the relief association in accordance with the 
        requirements of this subdivision.  The financial requirements of 
        the relief association shall be based on the most recent 
        actuarial valuation of the special fund prepared in accordance 
        with subdivision 2.  If the relief association has an unfunded 
        actuarial accrued liability as reported in the most recent 
        actuarial valuation, the financial requirements shall be 
        determined by adding the figures calculated pursuant to clauses 
        (a), (b), and (c).  If the relief association does not have an 
        unfunded actuarial accrued liability as reported in the most 
        recent actuarial valuation, the financial requirements shall be 
        an amount equal to the figure calculated pursuant to clauses (a) 
        and (b), reduced by an amount equal to one-tenth of the amount 
        of any assets in excess of the actuarial accrued liability of 
        the relief association.  The determination of whether or not the 
        relief association has an unfunded actuarial accrued liability 
        shall be based on the current market value of assets for which a 
        market value is readily ascertainable and the cost or book 
        value, whichever is applicable, for assets for which no market 
        value is readily ascertainable. 
           (a) The normal level cost requirement for the following 
        year, expressed as a dollar amount, shall be the figure for the 
        normal level cost of the relief association as reported in the 
        actuarial valuation. 
           (b) The amount of anticipated future administrative 
        expenses of the special fund shall be calculated by multiplying 
        the dollar amount of the administrative expenses of the special 
        fund for the most recent year by the factor of 1.035. 
           (c) The amortization contribution requirement to retire the 
        current unfunded actuarial accrued liability by the established 
        date for full funding shall be the figure for the amortization 
        contribution as reported in the actuarial valuation.  If there 
        has not been a change in the actuarial assumptions used for 
        calculating the actuarial accrued liability of the special fund, 
        a change in the bylaws of the relief association governing the 
        service pensions, retirement benefits, or both payable from the 
        special fund or a change in the actuarial cost method used to 
        value all or a portion of the special fund which change or 
        changes, which by themselves without inclusion of any other 
        items of increase or decrease, produce a net increase in the 
        unfunded actuarial accrued liability of the special fund since 
        December 31, 1970, the established date for full funding shall 
        be December 31, 1990.  If there has been a change in the 
        actuarial assumptions used for calculating the actuarial accrued 
        liability of the special fund, a change in the bylaws of the 
        relief association governing the service pensions, retirement 
        benefits, or both payable from the special fund or a change in 
        the actuarial cost method used to value all or a portion of the 
        special fund and the change or changes, by themselves and 
        without inclusion of any other items of increase or decrease, 
        produce a net increase in the unfunded actuarial accrued 
        liability of the special fund since December 31, 1970, but prior 
        to January 1, 1979, the established date for full funding shall 
        be December 31, 1998, and if there has been a change since 
        December 31, 1978, the established date for full funding shall 
        be determined using the following procedure:  
           (i) the unfunded actuarial accrued liability of the special 
        fund shall be determined in accordance with the provisions 
        governing service pensions, retirement benefits, and actuarial 
        assumptions in effect before an applicable change; 
           (ii) the level annual dollar contribution needed to 
        amortize this unfunded actuarial accrued liability amount by the 
        date for full funding in effect prior to the change shall be 
        calculated using the interest assumption specified in section 
        356.215, subdivision 4d, in effect before any applicable change; 
           (iii) the unfunded actuarial accrued liability of the 
        special fund shall be determined in accordance with any new 
        provisions governing service pensions, retirement benefits, and 
        actuarial assumptions and the remaining provisions governing 
        service pensions, retirement benefits, and actuarial assumptions 
        in effect before an applicable change; 
           (iv) the level annual dollar contribution needed to 
        amortize the difference between the unfunded actuarial accrued 
        liability amount calculated pursuant to subclause (i) and the 
        unfunded actuarial accrued liability amount calculated pursuant 
        to subclause (iii) over a period of 20 years starting December 
        31 of the year in which the change is effective shall be 
        calculated using the interest assumption specified in section 
        356.215, subdivision 4d, in effect after any applicable change; 
           (v) the annual amortization contribution calculated 
        pursuant to subclause (iv) shall be added to the annual 
        amortization contribution calculated pursuant to subclause (ii); 
           (vi) the period in which the unfunded actuarial accrued 
        liability amount determined in subclause (iii) will be amortized 
        by the total annual amortization contribution computed pursuant 
        to subclause (v) shall be calculated using the interest 
        assumption specified in section 356.215, subdivision 4d, in 
        effect after any applicable change, rounded to the nearest 
        integral number of years, but which shall not exceed a period of 
        20 years from the end of the year in which the determination of 
        the date for full funding using this procedure is made and which 
        shall not be less than the period of years beginning in the year 
        in which the determination of the date for full funding using 
        this procedure is made and ending by the date for full funding 
        in effect before the change.  
           (vii) the period determined pursuant to subclause (vi) 
        shall be added to the date as of which the actuarial valuation 
        was prepared and the resulting date shall be the new date for 
        full funding. 
           Sec. 2.  [BLOOMINGTON FIRE RELIEF ASSOCIATION.] 
           Notwithstanding requirements of Minnesota Statutes, section 
        69.77, subdivision 2b, to the contrary, for a volunteer fire 
        relief association described by Minnesota Statutes, section 
        69.77, subdivision 1a, clause (4), if the actuarial value of the 
        assets of the relief association exceed the actuarial accrued 
        liability as reported in the most recent actuarial valuation or 
        survey, the financial requirements of the relief association for 
        the following calendar year is the total of the amounts 
        calculated under Minnesota Statutes, section 69.77, subdivision 
        2b, clauses (a) and (b), reduced by one-tenth of the amount by 
        which the actuarial value of assets exceeds the actuarial 
        accrued liability. 
           Sec. 3.  [SOUTH ST. PAUL POLICE RELIEF ASSOCIATION; 
        CLARIFICATION OF UNCREDITABLE PROBATIONARY EMPLOYMENT.] 
           (a) Notwithstanding any provision of Minnesota Statutes, 
        sections 423.37 to 423.392, or any other law to the contrary, a 
        member of the South St. Paul police relief association who was 
        initially hired as a police officer by the city of South St. 
        Paul after September 1, 1978, and before March 1, 1979, and who 
        did not receive service credit in the relief association for 
        that portion of a period spent as a probationary employee that 
        exceeded six months is entitled to receive service credit in the 
        relief association for the probationary employment period in 
        excess of six months. 
           (b) To receive service credit authorized by paragraph (a), 
        the member must pay the member contributions that would have 
        been made if the person had been a relief association member 
        during the eligible period, plus annual compound interest on 
        that amount at the rate of five percent. 
           (c) The balance of the actuarial accrued liability for the 
        service credit granted under paragraph (a) that was not paid 
        under paragraph (b) must be included in the next actuarial 
        valuation of the South St. Paul police relief association under 
        Minnesota Statutes, sections 356.215 and 356.216, and the 
        resulting amortization requirement must be included in the 
        calculation of the minimum municipal obligation of the city of 
        South St. Paul under Minnesota Statutes, section 69.77. 
           Sec. 4.  [EFFECTIVE DATE.] 
           Section 1 is effective the day following final enactment.  
        Section 2 is effective upon approval of the Bloomington city 
        council and upon compliance with Minnesota Statutes, section 
        645.021.  Section 3 is effective upon approval by the South St. 
        Paul city council and compliance with Minnesota Statutes, 
        section 645.021. 
           Presented to the governor April 28, 1994 
           Signed by the governor April 29, 1994, 2:32 p.m.