Minnesota Session Laws - 1994, Regular Session

                            CHAPTER 572-S.F.No. 2498 
                  An act relating to retirement; offering options of 
                  coverage for employees of the higher education board 
                  upon merger of the state university system, community 
                  college board, and technical college board; directing 
                  a study of tax aspects of tax sheltered annuities; 
                  amending Minnesota Statutes 1992, sections 136E.04, by 
                  adding a subdivision; 354.66, subdivision 2; 354B.07, 
                  subdivision 1; and 354B.08; Minnesota Statutes 1993 
                  Supplement, sections 352.01, subdivision 2b; 353.01, 
                  subdivision 2a; 354B.02, subdivision 3c; and 354B.05, 
                  subdivision 1; proposing coding for new law in 
                  Minnesota Statutes, chapters 136C; and 136E. 
        BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
           Section 1.  [136C.75] [TRANSFER OF RETIREMENT FUND 
        MEMBERSHIP FOR TECHNICAL COLLEGE EMPLOYEES; ELECTION TO RETAIN 
        RETIREMENT FUND MEMBERSHIP.] 
           A person who is employed by a technical college or by the 
        technical college system on June 30, 1995, and who is 
        transferred to state employment shall remain a member of the 
        public employees retirement association or the Minneapolis 
        employees retirement fund, whichever applies, unless the person 
        affirmatively elects, in writing, retirement coverage by the 
        general state employees retirement plan of the Minnesota state 
        retirement system.  The following provisions govern the election 
        of a transfer or the retention of retirement benefit coverage: 
           (1) For a person who desires to transfer benefit coverage, 
        the affirmative written election must be made within 120 days of 
        the transfer of the employee to state employment. 
           (2) On behalf of transferred employees who retain 
        retirement benefit coverage with the pre-transfer retirement 
        plan, the higher education board shall make the applicable 
        employer contributions to the public employees retirement 
        association under section 353.27, subdivisions 3 and 3a, or the 
        same percentage of covered payroll employer contribution to the 
        Minneapolis employees retirement fund that special school 
        district no. 1 is required to make for that school year under 
        section 422A.101, subdivision 2. 
           (3) An employee who makes a retirement benefit coverage 
        transfer election under this section may revoke that election at 
        any time within the first six months after the person becomes a 
        state employee.  Once an employee revokes the retirement benefit 
        coverage transfer election, the employee may not make another 
        election.  If the initial retirement benefit coverage transfer 
        election is revoked, all retirement contributions made by or on 
        behalf of the employee revoking a prior election must be 
        transferred to the applicable retirement plan as though they 
        were erroneous deductions or contributions, plus monthly 
        interest at an annual rate of 8.5 percent, compounded monthly, 
        and the balance remaining between any contribution amount 
        transferred and the amount of contributions that otherwise would 
        have been due are payable in the applicable proportions by the 
        revoking employee and the higher education board, plus monthly 
        interest at an annual rate of 8.5 percent, compounded monthly. 
           (4) The executive directors of the Minnesota state 
        retirement system, the public employees retirement association, 
        and the Minneapolis employees retirement fund, and the 
        chancellor of the higher education system, shall confer and 
        jointly adopt appropriate procedures for making the retirement 
        benefit coverage transfer elections under this section. 
           (5) The executive directors of the public employees 
        retirement association, the Minnesota state retirement system, 
        and the Minneapolis employees retirement fund, whichever 
        applies, shall, upon request, provide appropriate benefit 
        counseling to applicable affected employees on the effect of 
        electing retirement benefit coverage by the general state 
        employees retirement plan of the Minnesota state retirement 
        system. 
           Sec. 2.  Minnesota Statutes 1992, section 136E.04, is 
        amended by adding a subdivision to read: 
           Subd. 8.  [PENSION PLAN.] Effective July 1, 1995, the board 
        shall assume the administrative responsibility for the 
        individual retirement account plans in chapter 354B formerly 
        administered separately by the state university board and the 
        community college board.  The separate plans and the former plan 
        administration must be merged into a single individual 
        retirement account plan and plan administration covering 
        eligible employees of the board, eligible employees of system 
        institutions, and other eligible employee groups who are covered 
        by the plan under section 354B.01. 
           Sec. 3.  [136E.395] [EARLY SEPARATION INCENTIVES.] 
           Subdivision 1.  [EMPLOYER PARTICIPATION; HIGHER EDUCATION 
        AGENCIES.] (a) In order to minimize the disruptive effects of 
        layoffs or reorganization attributable to the merger of the 
        state universities, community colleges, and technical colleges, 
        and the restructuring of the higher education coordinating 
        board, employees of the higher education coordinating board, the 
        state university, community college, and technical college 
        systems, and employees of local school districts, joint 
        technical districts, and intermediate districts assigned to a 
        technical college position, who are employed in positions that 
        are to be eliminated in the merger and restructuring, as 
        certified by the chancellor of the higher education board or the 
        executive director of the higher education coordinating board, 
        are entitled to elect an early separation incentive set forth in 
        subdivision 3. 
           (b) The higher education board and the higher education 
        coordinating board must determine those specific positions to be 
        permanently eliminated as part of the merger or restructuring 
        and identify the employees who may elect one of the early 
        separation incentives established by this section. 
           Subd. 2.  [ELIGIBILITY.] A person employed by the employing 
        units identified in subdivision 1 is eligible to elect the 
        incentive if the person: 
           (1) is an employee of the higher education coordinating 
        board, a state university, community college, or technical 
        college, or an administrative employee of a local school 
        district, joint technical district and intermediate district 
        assigned to a technical college position whose position is to be 
        eliminated; 
           (2) is at least age 55 but is not yet age 65; 
           (3) is employed in a permanent position and in active work 
        status at the time the incentive is elected; 
           (4) upon retirement, termination, or separation is 
        immediately eligible for a retirement annuity from a defined 
        benefit Minnesota public employee pension plan or a distribution 
        from a defined contribution Minnesota public employee pension 
        plan; 
           (5) retires, separates, or is terminated from an eligible 
        position after June 30, 1994, but before July 1, 1996; and 
           (6) has been certified by the chancellor of the higher 
        education board or the executive director of the higher 
        education coordinating board as eligible to elect an early 
        separation incentive. 
           Subd. 3.  [INCENTIVES.] (a) Eligible employees may elect 
        one of the following incentives but may not elect both.  
           (b) Retirement under this section means permanent 
        separation or termination from employment with or under the 
        control of the higher education board, the higher education 
        coordinating board, or the higher education systems to be merged.
           (c) Employees who separate, terminate, or retire with the 
        early retirement incentive under paragraph (e) may not be 
        rehired by the state in any employment position under the 
        control of the higher education board or the higher education 
        coordinating board. 
           (d) An eligible employee who receives a termination notice 
        after the effective date of this section may elect to take a 
        six-month retraining leave in order to complete a course of 
        study that is approved by the higher education board or the 
        higher education coordinating board and which is designed to 
        prepare the employee to assume a faculty position at a state 
        university, community college, or technical college.  The 
        retraining leave must be at the full salary level that the 
        person received immediately before the termination notice, 
        including fringe benefits.  The leave must be completed no later 
        than June 30, 1996.  Employees who seek to return to teaching 
        must satisfy the qualifications established by applicable 
        collective bargaining agreements.  Any subsequent faculty 
        appointments must be in accordance with collective bargaining 
        agreements and policies of the higher education board.  The 
        individual's pre-termination notice employment ceases at the 
        conclusion of the retraining leave.  Individual employee 
        eligibility for severance payments must be made in accordance 
        with the policies of the employing unit in effect at the time 
        the incentive was elected.  Notice of election of this incentive 
        must be made before April 1, 1996, on forms prescribed by the 
        higher education board. 
           (e) An eligible employee may elect the following instead of 
        the incentive in paragraph (d): 
           (1) state-paid hospital, medical, and dental insurance to 
        age 65.  An employee who retires, is terminated, or is separated 
        is eligible for single or dependent insurance coverages, 
        whichever applies, and any employer payments to which the person 
        was entitled immediately before retirement, termination, or 
        separation subject to any changes in coverage and employer and 
        employee payments through collective bargaining or personnel 
        plans in positions equivalent to the position from which the 
        employee retired, terminated, or separated.  The employee is not 
        eligible for employer-paid life insurance.  If the employee is 
        not yet age 65 at the time of retirement or separation, the 
        employee is eligible for employer-paid insurance under the 
        provisions of a personnel plan and has at least as many months 
        service with the current employer and the number of months the 
        individual is under age 65 at the time of retirement; and 
           (2) if the eligible employee has at least 15 years of 
        combined service credit in a Minnesota public pension plan, a 
        one-time opportunity to purchase up to two years of service 
        credit in or to make not more than two years of additional 
        member contributions to the public pension plan that the 
        employee is a member of at the time of retirement of separation 
        as follows: 
           (i) Eligible employees may have the additional payment made 
        on the basis of the employee's base salary in the year of 
        separation as denoted in the salary schedule in the applicable 
        employer personnel policy and at the rate and in the manner 
        specified in section 352.04, 353.27, 354.42, or 354A.12, 
        whichever applies.  The employee payment must include interest 
        at the rate of 8.5 percent.  The employer shall make the 
        required employer contribution and employer additional 
        contribution to the retirement fund as specified in section 
        352.04, 353.27, 354.42, or 354A.12, whichever applies for an 
        employee who elects this option.  Both the required employee and 
        employer payments must be made to the fund before the employee's 
        date of retirement or separation, whichever is earlier. 
           (ii) Defined contribution plan members in plans established 
        by chapter 352D or 354B must have additional employee and 
        employer contributions made on the basis of the employee's base 
        salary in the year of retirement as denoted in the salary 
        schedule in the applicable employer personnel policy and at the 
        rate and in the manner specified in section 352D.04, subdivision 
        2, or 354B.04, as applicable.  The additional contributions must 
        be made before the employee's date of retirement or separation, 
        whichever is earlier. 
           Sec. 4.  Minnesota Statutes 1993 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) 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 $5,000 or less per year, or, if they are 
        legally prohibited from serving more than three years; and the 
        board of managers of the state agricultural society and its 
        treasurer unless the treasurer is also its full-time secretary; 
           (14) state troopers; 
           (15) 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; 
           (16) 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; 
           (17) persons described in section 352B.01, subdivision 2, 
        clauses (2) to (5); 
           (18) 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; 
           (19) trainee employees, except those listed in subdivision 
        2a, clause (10); 
           (20) persons whose compensation is paid on a fee basis; 
           (21) 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; 
           (22) 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; 
           (23) chaplains and nuns 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, 
        if no irrevocable election of coverage has been made under 
        section 3121(r) of the Internal Revenue Code of 1954, as 
        amended; 
           (24) examination monitors employed by departments, 
        agencies, commissions, and boards to conduct examinations 
        required by law; 
           (25) members of appeal tribunals, exclusive of the chair, 
        to which reference is made in section 268.10, subdivision 4; 
           (26) persons appointed to serve as members of fact-finding 
        commissions or adjustment panels, arbitrators, or labor referees 
        under chapter 179; 
           (27) 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; 
           (28) full-time students employed by the Minnesota 
        historical society intermittently during part of the year and 
        full-time during the summer months; 
           (29) 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; 
           (30) persons employed in positions designated by the 
        department of employee relations as student workers; 
           (31) 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; 
           (32) 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; 
           (33) off-duty peace officers while employed by the 
        metropolitan transit commission under section 629.40, 
        subdivision 5, or comparable statutory authority; 
           (34) persons who are employed as full-time police officers 
        by the metropolitan transit commission and as police officers 
        are members of the public employees police and fire fund; 
           (35) 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; and 
           (36) foreign citizens with a work permit of less than three 
        years, or an H-1b/JV visa valid for less than three years of 
        employment, unless notice of extension is supplied which allows 
        them to work for three or more years as of the date the 
        extension is granted, in which case they are eligible for 
        coverage from the date extended; and 
           (37) persons who are employed by the higher education board 
        and who elect to remain members of the public employees 
        retirement association or the Minneapolis employees retirement 
        fund, whichever applies, under section 136C.75. 
           Sec. 5.  Minnesota Statutes 1993 Supplement, section 
        353.01, subdivision 2a, is amended to read: 
           Subd. 2a.  [INCLUDED EMPLOYEES.] Public employees whose 
        salary from one governmental subdivision exceeds $425 in any 
        month shall participate as members of the association.  If the 
        salary of an employee is less than $425 in a subsequent month, 
        the employee retains membership eligibility.  The following 
        persons are considered public employees: 
           (1) employees whose annual salary from one governmental 
        subdivision exceeds a stipulation prepared 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 expected to be of less than a full 
        year's duration.  If compensation from one governmental 
        subdivision to an employee under this clause 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 under 
        section 353.27, subdivision 12, from the month in which the 
        employee's salary first exceeded $425; 
           (2) employees whose total salary from concurrent 
        nontemporary positions in one governmental subdivision exceeds 
        $425 in any month; 
           (3) elected officers for service to which they were elected 
        by the public-at-large, or persons appointed to fill a vacancy 
        in an elective office, who elect to participate by filing an 
        application for membership, but not for service on a joint or 
        regional board that is a governmental subdivision under 
        subdivision 6, paragraph (a), unless the salary earned for that 
        service exceeds $425 in any month.  The option to become a 
        member, once exercised, may not be withdrawn during the 
        incumbency of the person in office; 
           (4) members who are appointed by the governor to be a state 
        department head and elect not to be covered by the Minnesota 
        state retirement system under section 352.021; 
           (5) employees of elected officers; 
           (6) persons who elect to remain members under 
        section 136C.75, or 480.181, subdivision 2; 
           (7) employees of a school district who receive separate 
        salaries for driving their own buses; 
           (8) employees of the Minnesota association of townships 
        when the board of the association, at its option, certifies to 
        the executive director that its employees are to be included for 
        purposes of retirement coverage, in which case coverage of all 
        employees of the association is permanent; 
           (9) employees of a county historical society who are county 
        employees; 
           (10) employees of a county historical society located in 
        the county whom the county, at its option, certifies to the 
        executive director to be county employees for purposes of 
        retirement coverage under this chapter, which status must be 
        accorded to all similarly situated county historical society 
        employees and, once established, must continue as long as a 
        person is an employee of the county historical society and is 
        not excluded under subdivision 2b; and 
           (11) employees who became members before July 1, 1988, 
        based on the total salary of positions held in more than one 
        governmental subdivision. 
           Sec. 6.  Minnesota Statutes 1992, section 354.66, 
        subdivision 2, is amended to read: 
           Subd. 2.  A teacher in the public elementary schools, 
        secondary schools, or technical colleges 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 colleges or 
        in the community college system or the state university system, 
        or a teacher in the technical college system, 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. 7.  Minnesota Statutes 1993 Supplement, section 
        354B.02, subdivision 3c, is amended to read: 
           Subd. 3c.  [HIGHER EDUCATION BOARD EMPLOYEES.] Employees in 
        covered employment under section 354B.01, subdivision 6, may 
        elect coverage under the plan.  Election to participate in the 
        plan must be made by December 31, 1993, or within 120 days of 
        the start of covered employment, whichever is later, and is 
        irrevocable during any period of covered employment in a 
        position listed in section 352D.02, subdivision 1, paragraph 
        (b), clause (14), which is established by the higher education 
        board or the higher education facilities authority.  These 
        employees are not also eligible for the supplemental retirement 
        plan specified in sections 354B.07 to 354B.09.  
           Sec. 8.  Minnesota Statutes 1993 Supplement, section 
        354B.05, subdivision 1, is amended to read: 
           Subdivision 1.  [GOVERNING BOARDS.] The state university 
        board or any successor board shall administer the plan for 
        persons in covered employment under section 354B.01, 
        subdivisions 2, 4, and 5.  The community college board or any 
        successor board shall administer the plan for persons in covered 
        employment under section 354B.01, subdivision 3.  
           Sec. 9.  Minnesota Statutes 1992, section 354B.07, 
        subdivision 1, is amended to read: 
           Subdivision 1.  [ESTABLISHMENT AND ELIGIBILITY.] (a) 
        [REGULAR UNCLASSIFIED EMPLOYEES.] The supplemental retirement 
        plan for personnel employed by the state university board and, 
        the state board for community colleges, the higher education 
        board, and effective July 1, 1995, the technical colleges, who 
        are in the unclassified service of the state commencing July 1 
        following the completion of the second year of their full-time 
        contract is governed by this section.  
           (b) [CETA UNCLASSIFIED EMPLOYEES.] An unclassified employee 
        employed by the state university board or the state board for 
        community colleges in subsidized on-the-job training, work 
        experience, or public service employment as an enrollee under 
        the federal Comprehensive Employment and Training Act is not 
        included in the supplemental retirement plan provided for in 
        this section after March 30, 1978, unless the unclassified 
        employee has as of the later of March 30, 1978, or the date of 
        employment sufficient service credit in the retirement fund 
        providing primary retirement coverage to meet the minimum 
        vesting requirements for a deferred retirement annuity, or the 
        board agrees in writing to make the employer contribution 
        required by this section on account of that unclassified 
        employee from revenue sources other than funds provided under 
        the federal Comprehensive Employment and Training Act, or the 
        unclassified employee agrees in writing to make the employer 
        contribution required by this section in addition to the member 
        contribution. 
           Sec. 10.  Minnesota Statutes 1992, section 354B.08, is 
        amended to read: 
           354B.08 [SALARY DEDUCTIONS, MATCHING FUNDS.] 
           Subdivision 1.  [DEDUCTIONS AND CONTRIBUTIONS.] (a) [BASIC 
        DEDUCTIONS AND CONTRIBUTIONS FOR STATE UNIVERSITIES AND 
        COMMUNITY COLLEGES.] The state university board and the state 
        board for community colleges shall deduct from the salary of 
        each eligible person described in section 354B.07 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.  
           (b) [BASIC DEDUCTIONS AND CONTRIBUTIONS FOR TECHNICAL 
        COLLEGES.] Effective July 1, 1995, unclassified employees of the 
        technical colleges are eligible for participation in the 
        supplemental retirement plan on the same basis as employees in 
        paragraph (a) for the basic deductions and contributions. 
           (c) [ADDITIONAL DEDUCTIONS AND CONTRIBUTIONS.] 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.  Two percent of 
        the amount of the salary deductions and employer contributions 
        may be used by the state university board and the state board 
        for community colleges boards for payment of necessary and 
        reasonable administrative expenses.  
           Subd. 2.  [ADMINISTRATION.] (a) 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 authorized by law.  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 annuity contracts or 
        custodial accounts. 
           (b) Effective July 1, 1995, administration of the plan must 
        transfer to the higher education board. 
           Sec. 11.  [EXISTING PENSION; RETIREMENT; OR SEPARATION 
        OBLIGATIONS.] 
           (a) Obligations incurred by a school board, a joint 
        vocational district under Minnesota Statutes, section 136C.60, 
        or an intermediate school district under Minnesota Statutes, 
        chapter 136D, before July 1, 1995, for retired employees who 
        were primarily employed in a technical college at the time of 
        retirement transfer to the higher education board on July 1, 
        1995.  Obligations incurred on or after June 30, 1994, for 
        retired employees who were primarily employed in a technical 
        college at the time of retirement and are not covered by a 
        collective bargaining agreement negotiated under Minnesota 
        Statutes, chapter 179A, transfer only if approved by the higher 
        education board. 
           (b) Pension, retirement, or separation obligations incurred 
        by a school board, a joint vocational district under Minnesota 
        Statutes, section 136C.60, or an intermediate school district 
        under Minnesota Statutes, chapter 136D, which are not satisfied 
        on or before June 30, 1995, on behalf of a technical college 
        must transfer to the higher education board, subject to limits 
        identified in state law or in plans or policies subject to 
        legislative approval. 
           Sec. 12.  [STUDY OF IMPLICATIONS OF EMPLOYER MATCHING 
        CONTRIBUTIONS TO SECTION 403(b) PLANS.] 
           The legislative commission on pensions and retirement shall 
        study whether pension provisions of federal tax laws apply to 
        employer matching contributions to tax sheltered annuity 
        contracts qualified under section 403(b) of the federal Internal 
        Revenue Code, as permitted under Minnesota Statutes 1993 
        Supplement, section 356.24.  The commission shall report the 
        results of the study and any proposed legislation to the chairs 
        of the committee on government operations and gaming and the 
        committee on ways and means of the house of representatives and 
        the committee on government operations and reform and the 
        committee on finance of the senate by January 15, 1995. 
           Sec. 13.  [EFFECTIVE DATE.] 
           Sections 1, 2, 4 to 6 and 8 to 11 are effective July 1, 
        1995. 
           Sections 3 and 7 are effective July 1, 1994. 
           Presented to the governor May 3, 1994 
           Signed by the governor May 5, 1994, 3:30 p.m.