Office of the Revisor of Statutes
Minnesota Session Laws - 1996, Regular Session
Key: (1) language to be deleted (2) new language
KEY: stricken = old language to be removed
underscored = new language to be added
CHAPTER 438-H.F.No. 2417
An act relating to retirement; various Minnesota
public pension plans; making various benefit and
coverage modifications; redirecting various state
pension aids to certain first class city teachers
retirement fund associations; requiring certain school
district employer contribution increases; making
various administrative modifications; establishing a
special task force to evaluate potential modifications
in various investment performance reporting programs;
amending Minnesota Statutes 1994, sections 3A.04,
subdivision 4; 16A.06, by adding a subdivision;
69.021, subdivision 7; 124.916, subdivision 3;
144C.06; 352.04, subdivision 8; 352.95, subdivision 2;
352B.10, subdivision 2; 352B.11, subdivision 1;
352C.09, by adding a subdivision; 353D.01, subdivision
2; 353D.02; 353D.03; 353D.04; 354.44, subdivisions 3
and 4; 354A.12, subdivisions 2 and 3c; 356A.06,
subdivisions 4 and 7; 423A.02, subdivision 1, and by
adding a subdivision; 423B.01, subdivision 9; 423B.15,
subdivision 3; 424A.001, by adding subdivisions;
424A.01, by adding a subdivision; 424A.02, subdivision
1; and 490.124, by adding a subdivision; Minnesota
Statutes 1995 Supplement, sections 144C.07,
subdivision 2; 144C.08; 354D.02, subdivision 2;
354D.03; 354D.04; 354D.06; and 356.219, subdivision 2;
Laws 1989, chapter 319, article 19, section 7,
subdivisions 1, as amended, and 4, as amended; and
Laws 1995, chapter 252, article 1, section 16;
proposing coding for new law in Minnesota Statutes,
chapters 354A; and 354D; repealing Minnesota Statutes
1994, section 353D.11; Laws 1990, chapter 570, article
13, section 1, subdivision 5.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:
ARTICLE 1
DESIGNATION OF BENEFICIARY FOR REFUND UPON DEATH
Section 1. Minnesota Statutes 1994, section 3A.04,
subdivision 4, is amended to read:
Subd. 4. [DEATH REFUNDS TO ESTATE.] Upon the death of a
member of the legislature or former legislator who was not
receiving a retirement allowance, without either a surviving
spouse and without any or dependent children, regardless of when
the death occurred, the last designated beneficiary named on a
form filed with the director before the death of the legislator,
or if no designation is filed, the estate of the member or
former legislator, upon application of the representative of the
estate, shall be entitled to a refund of contributions of the
deceased member of the legislature or former legislator plus
interest as provided in section 3A.03, subdivision 2, clause (2).
Sec. 2. Minnesota Statutes 1994, section 352B.11,
subdivision 1, is amended to read:
Subdivision 1. [REFUND OF PAYMENTS.] A member who has not
received other benefits under this chapter is entitled to a
refund of payments made by salary deduction, plus interest, if
the member is separated, either voluntarily or involuntarily,
from state service that entitled the member to membership. In
the event of the member's death, if there are no survivor
benefits payable under this chapter, a refund is payable to the
last designated beneficiary on a form filed with the director
before death, or if no designation is filed, the refund is
payable to the member's estate is entitled to the refund.
Interest must be computed at the rate of six percent a year,
compounded annually. To receive a refund, the member must apply
application must be made on a form prescribed by the executive
director.
Sec. 3. Minnesota Statutes 1994, section 352C.09, is
amended by adding a subdivision to read:
Subd. 3. [DEATH REFUND.] If a constitutional officer who
has not received other benefits under this chapter dies and
there are no survivor benefits payable under this chapter, a
refund plus interest as provided in section 352C.09, subdivision
2, clause (1), is payable to the last designated beneficiary
named on a form filed with the director before the death of the
constitutional officer, or if no designation is on file, the
refund is payable to the estate of the deceased constitutional
officer.
Sec. 4. Minnesota Statutes 1994, section 490.124, is
amended by adding a subdivision to read:
Subd. 13. [DEATH REFUND.] If a judge who has not received
other benefits under this chapter dies and there are no survivor
benefits payable under this chapter, a refund plus interest as
provided in section 490.124, subdivision 12, is payable to the
last designated beneficiary named on a form filed with the
director before the death of the judge, or if no designation is
on file, the refund is payable to the estate of the deceased
judge.
Sec. 5. [EFFECTIVE DATE.]
Sections 1 to 4 are effective July 1, 1996.
ARTICLE 2
ADMINISTRATIVE PROVISIONS RELATING TO THE
MINNESOTA STATE RETIREMENT SYSTEM
Section 1. Minnesota Statutes 1994, section 352.04,
subdivision 8, is amended to read:
Subd. 8. [DEPARTMENT REQUIRED TO PAY OMITTED SALARY
DEDUCTIONS.] (a) If a department fails to take deductions past
due for a period of 60 days or less from an employee's salary as
provided in this section, those deductions must be taken on
later payroll abstracts.
(b) If a department fails to take deductions past due for a
period in excess of 60 days from an employee's salary as
provided in this section, the department, and not the employee,
shall must pay on later payroll abstracts the employee and
employer contributions and an amount equivalent to 8.5 percent
of the total amount due in lieu of interest, or if the delay in
payment exceeds one year, 8.5 percent compound annual interest.
(c) If a department fails to take deductions past due for a
period of 60 days or less and the employee is no longer in state
service so that the required deductions cannot be taken from the
salary of the employee, the department shall must nevertheless
pay the required employer contributions. If any department
fails to take deductions past due for a period in excess of 60
days and the employee is no longer in state service, the omitted
contributions shall must be recovered under paragraph (b).
(d) If an employee from whose salary required deductions
were past due for a period of 60 days or less leaves state
service before the payment of the omitted deductions and
subsequently returns to state service, the unpaid amount is
considered the equivalent of a refund. The employee accrues no
right by reason of the unpaid amount, except that the employee
may pay the amount of omitted deductions as provided in section
352.23.
Sec. 2. Minnesota Statutes 1994, section 352.95,
subdivision 2, is amended to read:
Subd. 2. [NON-JOB-RELATED DISABILITY.] Any covered
correctional employee who, after at least one year of covered
correctional service, becomes disabled and physically or
mentally unfit to perform the duties of the position because of
sickness or injury occurring while not engaged in covered
employment, is entitled to a disability benefit based on covered
correctional service only. The disability benefit must be
computed as provided in section 352.93, subdivisions 1 and 2,
and computed as though the employee had at least 15 years of
covered correctional service.
Sec. 3. Minnesota Statutes 1994, section 352B.10,
subdivision 2, is amended to read:
Subd. 2. [DISABLED WHILE NOT ON DUTY.] If a member
terminates employment after at least one year of service because
of sickness or injury occurring while not on duty and not
engaged in state work entitling the member to membership, and
the termination is necessary because the member cannot perform
duties, the member is entitled to receive a disability
benefit member becomes disabled and physically or mentally unfit
to perform the duties of the position because of sickness or
injury occurring while not engaged in covered employment, the
member is entitled to disability benefits. The benefit must be
in the same amount and computed in the same way as if the member
were 55 years old at the date of disability and the annuity were
paid under section 352B.08. If disability under this clause
occurs after one but before 15 years service, the disability
benefit must be computed as though the member had 15 years
service.
Sec. 4. [EFFECTIVE DATE.]
Sections 1 to 3 are effective July 1, 1996.
ARTICLE 3
ADMINISTRATIVE PROVISIONS RELATING TO
THE TEACHERS RETIREMENT ASSOCIATION
Section 1. Minnesota Statutes 1994, section 354.44,
subdivision 3, is amended to read:
Subd. 3. [APPLICATION FOR RETIREMENT.] Application for
retirement must be made by the member or by someone authorized
to act in the member's behalf. A member or a person authorized
to act on behalf of the member may make application for
retirement provided the age and service requirements under
subdivision 1 are satisfied on or before the member's retirement
annuity accrual date under subdivision 4. The application may
be made no earlier than 120 days before the termination of
teaching service. The application must be made on a form
prescribed by the executive director and is not complete until
all necessary supporting documents are received by the executive
director.
Sec. 2. Minnesota Statutes 1994, section 354.44,
subdivision 4, is amended to read:
Subd. 4. [TIME AND MANNER OF PAYMENTS RETIREMENT ANNUITY
ACCRUAL DATE.] A member may make application to the board for a
retirement annuity any time after the member has satisfied the
age and service requirements of this chapter for retirement
except that an application for retirement must not be made more
than 60 days before termination of teaching service. The (a) An
annuity payment begins to accrue, providing that the age and
service requirements under subdivision 1 are satisfied, after
the termination of teaching service, or after the application
for retirement has been filed with the board, whichever is
later, as follows:
(a) (1) on the 16th day of the month of termination or
filing if the termination or filing occurs on or before the 15th
day of the month,;
(b) (2) on the first day of the month following the month
of termination or filing if the termination or filing occurs on
or after the 16th day of the month, or;
(c) (3) on July 1 for all school principals and other
administrators who receive a full annual contract salary during
the fiscal year for performance of a full year's contract
duties; or
(4) a later date to be the first or 16th day of a month
within the six-month period immediately following the
termination of teaching service as specified under paragraph (b)
by the member.
(b) If an application for retirement is filed with the
board during the six-month period immediately following the
termination of teaching service, the annuity may begin to accrue
as if the application for retirement had been filed with the
board on the date teaching service terminated or a later date
occurring within the six-month period as specified by the member
under paragraph (a), clause (4). An annuity must not begin to
accrue more than one month before the date of final salary
receipt.
Sec. 3. [EFFECTIVE DATE.]
Sections 1 and 2 are effective the day following final
enactment.
ARTICLE 4
INCREASED FUNDING FOR THE MINNEAPOLIS AND
ST. PAUL TEACHERS RETIREMENT FUND ASSOCIATIONS
Section 1. Minnesota Statutes 1994, section 16A.06, is
amended by adding a subdivision to read:
Subd. 9. [FIRST CLASS CITY TEACHER RETIREMENT FUNDS AIDS
REPORTING.] Each year, on or before April 15, the commissioner
of finance shall report to the chairs of the senate finance
committee and the house ways and means committee on expenditures
for state aids to the Minneapolis and Saint Paul teacher
retirement fund associations under sections 354A.12 and 423A.02,
subdivision 3. This report shall include the amounts expended
in the most recent fiscal year and estimates of expected
expenditures for the current and next fiscal year.
Sec. 2. Minnesota Statutes 1994, section 69.021,
subdivision 7, is amended to read:
Subd. 7. [APPORTIONMENT OF FIRE STATE AID TO
MUNICIPALITIES AND RELIEF ASSOCIATIONS.] (1) (a) The
commissioner shall apportion the fire state aid relative to the
premiums reported on the Minnesota Firetown Premium Reports
filed under this chapter to each municipality and/or
firefighters' relief association,.
(b) The commissioner shall calculate an initial fire state
aid allocation amount for each municipality or fire department
under paragraph (c) and a minimum fire state aid allocation
amount for each municipality or fire department under paragraph
(d). The municipality or fire department must receive the
larger fire state aid amount.
(c) The initial fire state aid allocation amount is the
amount available for apportionment as fire state aid under
subdivision 5, without inclusion of any additional funding
amount to support a minimum fire state aid amount under section
423A.02, subdivision 3, allocated one-half in proportion to the
population as shown in the last official statewide federal
census for each fire town and one-half in proportion to the
market value of each fire town, including the market value of
tax exempt property, but excluding the market value of
minerals. In the case of incorporated or municipal fire
departments furnishing fire protection to other cities, towns,
or townships as evidenced by valid fire service contracts filed
with the commissioner, the distribution shall must be adjusted
proportionately to take into consideration the crossover fire
protection service. Necessary adjustments shall be made to
subsequent apportionments. In the case of municipalities or
independent fire departments qualifying for the aid, the
commissioner shall calculate the state aid for the municipality
or relief association on the basis of the population and the
market value of the area furnished fire protection service by
the fire department as evidenced by duly executed and valid fire
service agreements filed with the commissioner. If one or more
fire departments are furnishing contracted fire service to a
city, town, or township, only the population and market value of
the area served by each fire department shall may be considered
in calculating the state aid and the fire departments furnishing
service shall enter into an agreement apportioning among
themselves the percent of the population and the market value of
each service area. The agreement shall must be in writing and
must be filed with the commissioner.
(d) The minimum fire state aid allocation amount is the
amount in addition to the initial fire state allocation amount
that is derived from any additional funding amount to support a
minimum fire state aid amount under section 423A.02, subdivision
3, and allocated to municipalities with volunteer firefighter
relief associations based on the number of active volunteer
firefighters who are members of the relief association as
reported in the annual financial reporting for the calendar year
1993 to the office of the state auditor, but not to exceed 30
active volunteer firefighters, so that all municipalities or
fire departments with volunteer firefighter relief associations
receive in total at least a minimum fire state aid amount per
1993 active volunteer firefighter to a maximum of 30
firefighters.
(e) The fire state aid shall must be paid to the treasurer
of the municipality where the fire department is located and the
treasurer of the municipality shall, within 30 days of receipt
of the fire state aid, transmit the aid to the relief
association if the relief association has filed a financial
report with the treasurer of the municipality and has met all
other statutory provisions pertaining to the aid apportionment.
(f) The commissioner may make rules to permit the
administration of the provisions of this section. Any
adjustments needed to correct prior misallocations must be made
to subsequent apportionments.
(2) Subd. 7a. [APPORTIONMENT OF POLICE STATE AID.] (a) The
commissioner shall apportion the state peace officer aid to each
municipality and to the county in the following manner:
(a) (1) For all municipalities maintaining police
departments and the county, the state aid shall must be
distributed in proportion to the total number of peace officers,
as determined under section 69.011, subdivision 1, clause (g),
and subdivision 2, clause (b), employed by each municipality and
by the county for 12 calendar months and the proportional or
fractional number who were employed less than 12 months;
(b) (2) For each municipality which contracts with the
county for police service, a proportionate amount of the state
aid distributed to the county based on the full-time equivalent
number of peace officers providing contract service shall must
be credited against the municipality's contract obligation; and
(c) (3) For each municipality which contracts with another
municipality for police service, a proportionate amount of the
state aid distributed to the municipality providing contract
service based on the full-time equivalent number of peace
officers providing contract service on a full-time equivalent
basis shall must be credited against the contract obligation of
the municipality receiving contract service;.
(d) (b) No municipality entitled to receive state peace
officer aid shall may be apportioned less state peace officer
aid for any year under Laws 1976, chapter 315, than the amount
which was apportioned to it for calendar year 1975 based on
premiums reported to the commissioner for calendar year 1974;
provided, the amount of state peace officer aid to other
municipalities within the county and to the county shall must be
adjusted in proportion to the total number of peace officers in
the municipalities and the county, so that the amount of state
peace officer aid apportioned shall does not exceed the amount
of state peace officer aid available for apportionment.
Sec. 3. Minnesota Statutes 1994, section 124.916,
subdivision 3, is amended to read:
Subd. 3. [RETIREMENT LEVIES.] (1) In addition to the
excess levy authorized in 1976 any district within a city of the
first class which was authorized in 1975 to make a retirement
levy under Minnesota Statutes 1974, section 275.127 and chapter
422A may levy an amount per pupil unit which is equal to the
amount levied in 1975 payable 1976, under Minnesota Statutes
1974, section 275.127 and chapter 422A, divided by the number of
pupil units in the district in 1976-1977.
(2) In 1979 and each year thereafter, any district which
qualified in 1976 for an extra levy under clause (1) shall be
allowed to levy the same amount as levied for retirement in 1978
under this clause reduced each year by ten percent of the
difference between the amount levied for retirement in 1971
under Minnesota Statutes 1971, sections 275.127 and 422.01 to
422.54 and the amount levied for retirement in 1975 under
Minnesota Statutes 1974, section 275.127 and chapter 422A.
(3) In 1991 and each year thereafter, a district to which
this subdivision applies may levy an additional amount required
for contributions to the Minneapolis employees retirement fund
as a result of the maximum dollar amount limitation on state
contributions to the fund imposed under section 422A.101,
subdivision 3. The additional levy shall not exceed the most
recent amount certified by the board of the Minneapolis
employees retirement fund as the district's share of the
contribution requirement in excess of the maximum state
contribution under section 422A.101, subdivision 3.
(4) For taxes payable in 1994 and thereafter, special
school district No. 1, Minneapolis, and independent school
district No. 625, St. Paul, may levy for the increase in the
employer retirement fund contributions, under Laws 1992, chapter
598, article 5, section 1. Notwithstanding section 121.904, the
entire amount of this levy may be recognized as revenue for the
fiscal year in which the levy is certified. This levy shall not
be considered in computing the aid reduction under section
124.155.
(5) If the employer retirement fund contributions under
section 354A.12, subdivision 2a, are increased for fiscal year
1994 or later fiscal years, special school district No. 1,
Minneapolis, and independent school district No. 625, St. Paul,
may levy in payable 1994 or later an amount equal to the amount
derived by applying the net increase in the employer retirement
fund contribution rate of the respective teacher retirement fund
association between fiscal year 1993 and the fiscal year
beginning in the year after the levy is certified to the total
covered payroll of the applicable teacher retirement fund
association. Notwithstanding section 121.904, the entire amount
of this levy may be recognized as revenue for the fiscal year in
which the levy is certified. This levy shall not be considered
in computing the aid reduction under section 124.155. If an
applicable school district levies under this paragraph, they may
not levy under paragraph (4).
(6) In addition to the levy authorized under paragraph (5),
special school district No. 1, Minneapolis, may also levy
payable in 1997 or later an amount equal to the contributions
under section 423A.02, subdivision 3, and may also levy in
payable 1994 or later an amount equal to the state aid
contribution under section 354A.12, subdivision 3b. Independent
school district No. 625, St. Paul, may levy payable in 1997 or
later an amount equal to the supplemental contributions under
section 423A.02, subdivision 3. Notwithstanding section
121.904, the entire amount of this levy these levies may be
recognized as revenue for the fiscal year in which the levy is
certified. This levy These levies shall not be considered in
computing the aid reduction under section 124.155.
Sec. 4. [354A.105] [MINNEAPOLIS TEACHERS RETIREMENT FUND
ASSOCIATION; PURCHASE OF ALLOWABLE SERVICE CREDIT FOR TEACHING
SERVICE OUTSIDE MINNESOTA.]
(a) Notwithstanding any law, article of incorporation, or
bylaw provision of the Minneapolis teachers retirement fund
association to the contrary, an active member who has engaged in
other elementary or secondary public school teaching employment
either outside the state of Minnesota, but rendered in the
United States, or for the federal government before first
becoming a member of the association and who has met the
qualifications of paragraph (b) may elect to purchase and
receive allowable service credit in the applicable program of
the association for qualified prior service in other elementary
or secondary public school teaching employment that satisfies
the requirements of paragraph (c) by making the required payment
under paragraph (d).
(b) A member may elect to purchase allowable service credit
for other elementary or secondary public school teaching
employment under this subdivision if:
(1) the member has at least three years of allowable
service credit in the applicable program of the association; and
(2) the member did not and could not receive accrued
benefits by leaving the person's accumulated member
contributions with any other retirement system under the
applicable law in effect at the termination of the other public
employment.
(c) Service in other elementary or secondary public school
teaching employment rendered in the United States qualifies for
purchase under this subdivision if the service to be credited:
(1) does not exceed the lesser of ten years or the member's
total years of allowable teaching service in the Minneapolis
public schools at the time of the purchase;
(2) is equivalent to full-time allowable service as
determined in accordance with the statutes and rules applicable
to the association at the time of the purchase;
(3) is purchased in full year increments;
(4) is not for a period of service that has been used by
the member to qualify for an annuity from any other public
school retirement fund or system, as certified by the chief
administrative officer of the applicable retirement system; and
(5) is not available to be used for the purpose of
qualifying the member for a disability benefit from the
association.
(d) For a person eligible to purchase credit for qualifying
service under this subdivision, there must be paid to the
association an amount equal to the present value, on the date of
payment, of the amount of the additional retirement annuity that
would be obtained by virtue of the purchase of the additional
service credit, using the applicable preretirement interest rate
specified in section 356.215, subdivision 4d, and the mortality
table adopted for the retirement fund association and assuming
continuous future service in the retirement fund association
until the age at which the minimum requirements are met for
normal retirement with an annuity unreduced for retirement
before the normal retirement age, including the provisions of
section 356.30, and also assuming a future salary history that
includes increases at the applicable rate assumed under section
356.215, subdivision 4d.
(e) Payments under this section must be made only by the
member. The employer unit may not make any payment to or on
behalf of any member for the purpose of purchasing service
credit under this section.
(f) This section is repealed effective July 1, 2005. On or
before January 1, 2006, special school district No. 1 and the
Minneapolis teachers retirement fund association shall jointly
report to the legislature and the governor on the effects of the
provisions under this section on the district, fund, and
members. The report shall include information on use of the
service credit purchase provisions, the usefulness of this
section in promoting the recruitment and retention objectives of
the district, and the portability of pension benefits for
teachers and school administrative personnel.
Sec. 5. Minnesota Statutes 1994, section 354A.12,
subdivision 2, is amended to read:
Subd. 2. [RETIREMENT CONTRIBUTION LEVY DISALLOWED.] Except
as provided in subdivision 3b, paragraph (d) and in section
423A.02, subdivision 3, with respect to the city of Minneapolis
and special school district No. 1 and in section 423A.02,
subdivision 3, with respect to independent school district No.
625, notwithstanding any law to the contrary, levies for
teachers retirement fund associations in cities of the first
class, including levies for any employer social security taxes
for teachers covered by the Duluth teachers retirement fund
association or the Minneapolis teachers retirement fund
association or the St. Paul teachers retirement fund
association, are disallowed.
Sec. 6. Minnesota Statutes 1994, section 354A.12,
subdivision 3c, is amended to read:
Subd. 3c. [TERMINATION OF SUPPLEMENTAL CONTRIBUTIONS AND
DIRECT STATE MATCHING AND STATE AID.] (a) The supplemental
contributions payable to the Minneapolis teachers retirement
fund association by special school district No. 1 and the city
of Minneapolis under section 423A.02, subdivision 3, or to the
St. Paul teachers retirement fund association by independent
school district No. 625 under section 423A.02, subdivision 3,
the direct state aid under subdivision 3a to the St. Paul
teachers retirement association, and the direct matching and
state aid under subdivision 3b to the Minneapolis teachers
retirement fund association terminates for the respective fund
at the end of the fiscal year in which the accrued liability
funding ratio for that fund, as determined in the most recent
actuarial report for that fund by the actuary retained by the
legislative commission on pensions and retirement, equals or
exceeds the accrued liability funding ratio for the teachers
retirement association, as determined in the most recent
actuarial report for the teachers retirement association by the
actuary retained by the legislative commission on pensions and
retirement.
(b) If the direct matching, supplemental, or state aid is
terminated for the St. Paul teachers retirement fund association
or the Minneapolis teachers retirement fund association under
paragraph (a), it may not again be received by that fund.
(c) If either the Minneapolis teachers retirement fund
association or the St. Paul teachers retirement fund association
remain funded at less than the funding ratio applicable to the
teachers retirement association when the provisions of paragraph
(b) become effective, then any state aid not distributed to that
association must be immediately transferred to the other
association.
Sec. 7. Minnesota Statutes 1994, section 356A.06,
subdivision 7, is amended to read:
Subd. 7. [EXPANDED LIST OF AUTHORIZED INVESTMENT
SECURITIES.] (a) [AUTHORITY.] Except to the extent otherwise
authorized by law or bylaws, a covered pension plan not
described by subdivision 6, paragraph (a), may invest its assets
only in accordance with this subdivision.
(b) [SECURITIES GENERALLY.] The covered pension plan has
the authority to purchase, sell, lend, or exchange the
securities specified in paragraphs (c) to (g), including puts
and call options and future contracts traded on a contract
market regulated by a governmental agency or by a financial
institution regulated by a governmental agency. These
securities may be owned as units in commingled trusts that own
the securities described in paragraphs (c) to (g).
(c) [GOVERNMENT OBLIGATIONS.] The covered pension plan may
invest funds in governmental bonds, notes, bills, mortgages, and
other evidences of indebtedness provided the issue is backed by
the full faith and credit of the issuer or the issue is rated
among the top four quality rating categories by a nationally
recognized rating agency. The obligations in which funds may be
invested under this paragraph include guaranteed or insured
issues of (1) the United States, its agencies, its
instrumentalities, or organizations created and regulated by an
act of Congress; (2) Canada and its provinces, provided the
principal and interest is payable in United States dollars; (3)
the states and their municipalities, political subdivisions,
agencies, or instrumentalities; (4) the International Bank for
Reconstruction and Development, the Inter-American Development
Bank, the Asian Development Bank, the African Development Bank,
or any other United States government sponsored organization of
which the United States is a member, provided the principal and
interest is payable in United States dollars.
(d) [CORPORATE OBLIGATIONS.] The covered pension plan may
invest funds in bonds, notes, debentures, transportation
equipment obligations, or any other longer term evidences of
indebtedness issued or guaranteed by a corporation organized
under the laws of the United States or any state thereof, or the
Dominion of Canada or any province thereof if they conform to
the following provisions:
(1) the principal and interest of obligations of
corporations incorporated or organized under the laws of the
Dominion of Canada or any province thereof must be payable in
United States dollars; and
(2) obligations must be rated among the top four quality
categories by a nationally recognized rating agency.
(e) [OTHER OBLIGATIONS.] (1) The covered pension plan may
invest funds in bankers acceptances, certificates of deposit,
deposit notes, commercial paper, mortgage participation
certificates and pools, asset backed securities, repurchase
agreements and reverse repurchase agreements, guaranteed
investment contracts, savings accounts, and guaranty fund
certificates, surplus notes, or debentures of domestic mutual
insurance companies if they conform to the following provisions:
(i) bankers acceptances and deposit notes of United States
banks are limited to those issued by banks rated in the highest
four quality categories by a nationally recognized rating
agency;
(ii) certificates of deposit are limited to those issued by
(A) United States banks and savings institutions that are rated
in the highest four quality categories by a nationally
recognized rating agency or whose certificates of deposit are
fully insured by federal agencies; or (B) credit unions in
amounts up to the limit of insurance coverage provided by the
National Credit Union Administration;
(iii) commercial paper is limited to those issued by United
States corporations or their Canadian subsidiaries and rated in
the highest two quality categories by a nationally recognized
rating agency;
(iv) mortgage participation or pass through certificates
evidencing interests in pools of first mortgages or trust deeds
on improved real estate located in the United States where the
loan to value ratio for each loan as calculated in accordance
with section 61A.28, subdivision 3, does not exceed 80 percent
for fully amortizable residential properties and in all other
respects meets the requirements of section 61A.28, subdivision
3;
(v) collateral for repurchase agreements and reverse
repurchase agreements is limited to letters of credit and
securities authorized in this section;
(vi) guaranteed investment contracts are limited to those
issued by insurance companies or banks rated in the top four
quality categories by a nationally recognized rating agency or
to alternative guaranteed investment contracts where the
underlying assets comply with the requirements of this
subdivision; and
(vii) savings accounts are limited to those fully insured
by federal agencies; and
(viii) asset backed securities must be rated in the top
four quality categories by a nationally recognized rating agency.
(2) Sections 16A.58 and 16B.06 do not apply to certificates
of deposit and collateralization agreements executed by the
covered pension plan under clause (1), item (ii).
(3) In addition to investments authorized by clause (1),
item (iv), the covered pension plan may purchase from the
Minnesota housing finance agency all or any part of a pool of
residential mortgages, not in default, that has previously been
financed by the issuance of bonds or notes of the agency. The
covered pension plan may also enter into a commitment with the
agency, at the time of any issue of bonds or notes, to purchase
at a specified future date, not exceeding 12 years from the date
of the issue, the amount of mortgage loans then outstanding and
not in default that have been made or purchased from the
proceeds of the bonds or notes. The covered pension plan may
charge reasonable fees for any such commitment and may agree to
purchase the mortgage loans at a price sufficient to produce a
yield to the covered pension plan comparable, in its judgment,
to the yield available on similar mortgage loans at the date of
the bonds or notes. The covered pension plan may also enter
into agreements with the agency for the investment of any
portion of the funds of the agency. The agreement must cover
the period of the investment, withdrawal privileges, and any
guaranteed rate of return.
(f) [CORPORATE STOCKS.] The covered pension plan may
invest funds in stocks or convertible issues of any corporation
organized under the laws of the United States or the states
thereof, the Dominion of Canada or its provinces, or any
corporation listed on the New York Stock Exchange or the
American Stock Exchange, if they conform to the following
provisions:
(1) The aggregate value of corporate stock investments, as
adjusted for realized profits and losses, must not exceed 85
percent of the market or book value, whichever is less, of a
fund, less the aggregate value of investments according to
subdivision 6;
(2) Investments must not exceed five percent of the total
outstanding shares of any one corporation.
(g) [OTHER INVESTMENTS.] (1) In addition to the
investments authorized in paragraphs (b) to (f), and subject to
the provisions in clause (2), the covered pension plan may
invest funds in:
(i) venture capital investment businesses through
participation in limited partnerships and corporations;
(ii) real estate ownership interests or loans secured by
mortgages or deeds of trust through investment in limited
partnerships, bank sponsored collective funds, trusts, and
insurance company commingled accounts, including separate
accounts;
(iii) regional and mutual funds through bank sponsored
collective funds and open-end investment companies registered
under the Federal Investment Company Act of 1940;
(iv) resource investments through limited partnerships,
private placements, and corporations; and
(v) international securities.
(2) The investments authorized in clause (1) must conform
to the following provisions:
(i) the aggregate value of all investments made according
to clause (1) may not exceed 35 percent of the market value of
the fund for which the covered pension plan is investing;
(ii) there must be at least four unrelated owners of the
investment other than the state board for investments made under
clause (1), item (i), (ii), (iii), or (iv);
(iii) covered pension plan participation in an investment
vehicle is limited to 20 percent thereof for investments made
under clause (1), item (i), (ii), (iii), or (iv); and
(iv) covered pension plan participation in a limited
partnership does not include a general partnership interest or
other interest involving general liability. The covered pension
plan may not engage in any activity as a limited partner which
creates general liability.
Sec. 8. Minnesota Statutes 1994, section 423A.02,
subdivision 1, is amended to read:
Subdivision 1. [AMORTIZATION STATE AID.] (a) A
municipality in which is located a local police or salaried
firefighters' relief association to which the provisions of
section 69.77, apply, that had an unfunded actuarial accrued
liability in the most recent relief association actuarial
valuation, is entitled, upon application as required by the
commissioner of revenue, to receive local police and salaried
firefighters' relief association amortization state aid if the
municipality and the appropriate relief association both comply
with the applicable provisions of sections 69.031, subdivision
5, 69.051, subdivisions 1 and 3, and 69.77. If a municipality
loses entitlement for amortization state aid in any year because
its local relief association no longer has an unfunded actuarial
accrued liability, the municipality is not entitled to
amortization state aid in any subsequent year.
(b) The total amount of amortization state aid to all
entitled municipalities must not exceed $5,055,000.
(c) Subject to the adjustment for the city of Minneapolis
provided in this paragraph, the amount of amortization state aid
to which a municipality is entitled annually is an amount equal
to the level annual dollar amount required to amortize, by
December 31, 2010, the unfunded actuarial accrued liability of
the special fund of the appropriate relief association as
reported in the December 31, 1978, actuarial valuation of the
relief association prepared under sections 356.215 and 356.216,
reduced by the dollar amount required to pay the interest on the
unfunded actuarial accrued liability of the special fund of the
relief association for calendar year 1981 set at the rate
specified in Minnesota Statutes 1978, section 356.215,
subdivision 4, clause (4). For the city of Minneapolis, the
amortization state aid amount thus determined must be reduced by
$747,232 on account of the Minneapolis police relief association
and by $772,768 on account of the Minneapolis fire department
relief association. If the amortization state aid amounts
determined under this paragraph exceed the amount appropriated
for this purpose, the amortization state aid for actual
allocation must be reduced pro rata.
(d) Payment of amortization state aid to municipalities
must be made directly to the municipalities involved in four
three equal installments on March 15, July 15, September 15, and
November 15 annually. Upon receipt of amortization state aid,
the municipal treasurer shall transmit the aid amount to the
treasurer of the local relief association for immediate deposit
in the special fund of the relief association.
(e) The commissioner of revenue shall prescribe and
periodically revise the form for and content of the application
for the amortization state aid.
Sec. 9. Minnesota Statutes 1994, section 423A.02, is
amended by adding a subdivision to read:
Subd. 3. [REALLOCATION OF AMORTIZATION OR SUPPLEMENTARY
AMORTIZATION STATE AID.] (a) Seventy percent of the difference
between $5,720,000 and the current year amortization aid or
supplemental amortization aid distributed under subdivisions 1
and 1a that is not distributed for any reason to a municipality
for use by a local police or salaried fire relief association
must be distributed by the commissioner of revenue according to
this paragraph. The commissioner shall distribute 70 percent of
the amounts derived under this paragraph to the Minneapolis
teachers retirement fund association and 30 percent to the St.
Paul teachers retirement fund association to fund the unfunded
actuarial accrued liabilities of the respective funds. These
payments shall be made on or before June 30 each fiscal year.
The amount required under this paragraph is appropriated
annually from the general fund to the commissioner of revenue.
If either the Minneapolis teachers retirement fund association
or the St. Paul teachers retirement fund association becomes
funded at the funding ratio applicable to the teachers
retirement association based on the actuarial reports prepared
by the actuary for the legislative commission on pensions and
retirement, then the commissioner shall distribute that fund's
share under this paragraph to the other fund. The appropriation
under this paragraph terminates when both funds become fully
funded. Amounts remaining in the undistributed balance account
at the end of the biennium cancel to the general fund.
(b) In order to receive amortization and supplementary
amortization aid under paragraph (a), independent school
district No. 625, St. Paul, must make contributions to the St.
Paul teachers retirement fund association in accordance with the
following schedule:
Fiscal Year Amount
1996 $0
1997 $0
1998 $200,000
1999 $400,000
2000 $600,000
2001 and thereafter $800,000
(c) In order to receive amortization and supplementary
amortization aid under paragraph (a), special school district No.
1, Minneapolis, and the city of Minneapolis must each make
contributions to the Minneapolis teachers retirement fund
association in accordance with the following schedule:
Fiscal Year City School district
amount amount
1996 $0 $0
1997 $0 $0
1998 $250,000 $250,000
1999 $400,000 $400,000
2000 $550,000 $550,000
2001 $700,000 $700,000
2002 $850,000 $850,000
2003 and $1,000,000 $1,000,000
thereafter
(d) Money contributed under paragraph (a) and either
paragraph (b) or (c), as applicable, must be credited to a
separate account in the applicable teachers retirement fund and
may not be used in determining any benefit increases. The
separate account terminates for a fund when the aid payments to
the fund under paragraph (a) cease.
(e) Thirty percent of the difference between $5,720,000 and
the current year amortization aid or supplemental amortization
aid under subdivisions 1 and 1a that is not distributed for any
reason to a municipality for use by a local police or salaried
firefighter relief association must be distributed under section
69.021, subdivision 7, paragraph (d), as additional funding to
support a minimum fire state aid amount for volunteer
firefighter relief associations. The amount required under this
paragraph is appropriated annually to the commissioner of
revenue.
Sec. 10. Minnesota Statutes 1994, section 423B.01,
subdivision 9, is amended to read:
Subd. 9. [EXCESS INVESTMENT INCOME.] "Excess investment
income" means the amount, if any, by which the average time
weighted total rate of return earned by the fund in the most
recent prior five fiscal year years has exceeded the actual
average percentage increase in the current monthly salary of a
first grade patrol officer in the most recent prior five fiscal
year years plus two percent, and must be expressed as a dollar
amount and may not exceed one percent of the total assets of the
fund and does not exist unless 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 first grade
patrol officer during the previous five calendar years.
Sec. 11. Minnesota Statutes 1994, section 423B.15,
subdivision 3, is amended to read:
Subd. 3. [AMOUNT OF ANNUAL POSTRETIREMENT PAYMENT.] The
amount determined under subdivision 2 must be applied in
accordance with this subdivision. The relief association shall
apply the first one-half of excess investment income to the
payment of an annual postretirement payment as specified in this
subdivision. The second one-half of excess investment income
must 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 average time weighted total rate of return for the
most recent prior five years exceeds by two percent the actual
average percentage increase in the current monthly salary of a
top grade patrol officer in the most recent prior five 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 of the
previous five years. The total amount of all payments to
members may not exceed the amount determined under this
subdivision. 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.
A person who received a pension or benefit for the entire
12 months before the determination date is eligible for a full
annual postretirement payment. A person who received a pension
or benefit for less than 12 months before the determination date
is eligible for a prorated annual postretirement payment.
Sec. 12. Laws 1989, chapter 319, article 19, section 7,
subdivision 1, as amended by Laws 1992, chapter 471, article 2,
section 5, is amended to read:
Subdivision 1. [MINNEAPOLIS FIRE DEPARTMENT RELIEF
ASSOCIATION; DEFINITIONS.] For the purposes of this section,
each of the terms in this subdivision have the meanings given
them in paragraphs (a) to (h).
(a) "Annual postretirement payment" means the payment of a
lump sum postretirement benefit to an eligible member on June 1
following the determination date in any year.
(b) "City" means the city of Minneapolis.
(c) "Determination date" means December 31 of each year.
(d) "Eligible member" means a person, including a service
pensioner, a disability pensioner, a survivor, or dependent of a
deceased active member, service pensioner, or disability
pensioner, who received a pension or benefit from the relief
association during the 12 months before the determination date.
A person who received a pension or benefit for the entire 12
months before the determination date is eligible for a full
annual postretirement payment. A person who received a pension
or benefit for less than 12 months before the determination date
is eligible for a prorated annual postretirement payment.
(e) "Excess investment income" means the amount by which
the average time weighted total rate of return earned by the
fund in the most recent prior five fiscal year years has
exceeded the actual average percentage increase in the current
monthly salary of a top grade firefighter in the most
recent prior five fiscal year years plus two percent. The
excess investment income must be expressed as a dollar amount
and may not exceed one percent of the total assets of the
fund and does not exist unless 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
firefighter during the previous five calendar years.
(f) "Fund" means the Minneapolis fire department relief
association.
(g) "Relief association" means the Minneapolis fire
department relief association.
(h) "Time weighted total rate of return" means the
percentage amount determined by using the formula or formulas
established by the state board of investment under Minnesota
Statutes, section 11A.04, clause (11), and in effect on January
1, 1987.
Sec. 13. Laws 1989, chapter 319, article 19, section 7,
subdivision 4, as amended by Laws 1990, chapter 570, article 12,
section 63, and Laws 1992, chapter 471, article 2, section 6, 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 average time
weighted total rate of return in the most recent prior five
fiscal years exceeds by two percent the actual average
percentage increase in the current monthly salary of a top grade
firefighter in the most recent prior five 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 firefighter 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. 14. [EFFECTIVE DATE.]
Sections 1 to 13 are effective the day following final
enactment and apply to aid payments beginning in calendar year
1996.
ARTICLE 5
ADMINISTRATIVE PROVISIONS RELATING TO THE
AMBULANCE SERVICE PERSONNEL LONGEVITY
AWARD PROGRAM
Section 1. Minnesota Statutes 1994, section 144C.06, is
amended to read:
144C.06 [TRUST ACCOUNT INVESTMENT.]
The trust account must be invested by the state board of
investment in nonretirement funds established under the
provisions of section 11A.14. The trust account must be
invested in investment accounts so that the asset allocation is
similar to the asset allocation of the income share account of
the Minnesota supplemental investment fund, as provided in
governed by section 11A.20 11A.17.
Sec. 2. Minnesota Statutes 1995 Supplement, section
144C.07, subdivision 2, is amended to read:
Subd. 2. [POTENTIAL ALLOCATIONS.] (a) On September
November 1, annually, the board or the board's designee under
section 144C.01, subdivision 2, shall determine the amount of
the allocation of the prior year's accumulation to each
qualified ambulance service person. The prior year's net
investment gain or loss under paragraph (b) must be allocated
and that year's general fund appropriation, plus any transfer
from the suspense account under section 144C.03, subdivision 2,
and after deduction of administrative expenses, also must be
allocated.
(b) The difference in the market value of the assets of the
ambulance service personnel longevity award and incentive trust
account as of the immediately previous June 30 and the June 30
occurring 12 months earlier must be reported on or before August
15 by the state board of investment. The market value gain or
loss must be expressed as a percentage of the total potential
award accumulations as of the immediately previous June 30, and
that positive or negative percentage must be applied to increase
or decrease the recorded potential award accumulation of each
qualified ambulance service person.
(c) The appropriation for this purpose, after deduction of
administrative expenses, must be divided by the total number of
additional ambulance service personnel years of service
recognized since the last allocation or 1,000 years of service,
whichever is greater. If the allocation is based on the 1,000
years of service, any allocation not made for a qualified
ambulance service person must be credited to the suspense
account under section 144C.03, subdivision 2. A qualified
ambulance service person must be credited with a year of service
if the person is certified by the chief administrative officer
of the ambulance service as having rendered active ambulance
service during the 12 months ending as of the immediately
previous June 30. If the person has rendered prior active
ambulance service, the person must be additionally credited with
one-fifth of a year of service for each year of active ambulance
service rendered before June 30, 1993, but not to exceed in any
year one additional year of service or to exceed in total five
years of prior service. Prior active ambulance service means
employment by or the provision of service to a licensed
ambulance service before June 30, 1993, as determined by the
person's current ambulance service based on records provided by
the person that were contemporaneous to the service. The prior
ambulance service must be reported on or before August 15 1 to
the board in an affidavit from the chief administrative officer
of the ambulance service.
Sec. 3. Minnesota Statutes 1995 Supplement, section
144C.08, is amended to read:
144C.08 [AMBULANCE SERVICE PERSONNEL LONGEVITY AWARD.]
(a) A qualified ambulance service person who has terminated
active ambulance service, who has at least five years of
credited ambulance service, who is at least 50 years old, and
who is among the 400 persons with the greatest amount of
credited ambulance service applying for a longevity award during
that year, is entitled, upon application, to an ambulance
service personnel longevity award. An applicant whose
application is not approved because of the limit on the number
of annual awards may apply in a subsequent year.
(b) If a qualified ambulance service person who meets the
age and service requirements specified in paragraph (a) dies
before applying for a longevity award, the estate of the
decedent is entitled, upon application, to the decedent's
ambulance service personnel longevity award, without reference
to the limit on the number of annual awards.
(c) An ambulance service personnel longevity award is the
total amount of the person's accumulations indicated in the
person's separate record under section 144C.07 as of the August
15 preceding the application November 1 in the calendar year in
which application is made. The amount is payable only in a lump
sum.
(d) Applications for an ambulance service personnel
longevity award must be received by the board or the board's
designee under section 144C.01, subdivision 2, by August 15
October 1, annually. Ambulance service personnel longevity
awards are payable only as of the last business day in October
December annually.
Sec. 4. [EFFECTIVE DATE.]
(a) Sections 1 to 3 are effective July 1, 1996.
(b) Any investments of the ambulance service personnel
longevity award and incentive trust account made before July 1,
1996, may be retained in the trust account after June 30, 1996,
until, in its judgment, the state board of investment determines
that it is appropriate to liquidate those prior holdings.
ARTICLE 6
PUBLIC EMPLOYEES DEFINED CONTRIBUTION PLAN
COVERAGE OPTION FOR LOCAL GOVERNMENT PHYSICIANS
Section 1. Minnesota Statutes 1994, section 353D.01,
subdivision 2, is amended to read:
Subd. 2. [ELIGIBILITY.] Except as provided in section
353D.11, (a) Eligibility to participate in the defined
contribution plan is open available to an:
(1) elected local government official officials of a
governmental subdivision who elects elect to participate in the
plan under section 353D.02, subdivision 1, and who, for the
elected service rendered to a governmental subdivision, is are
not a member members of the public employees retirement
association within the meaning of section 353.01, subdivision
7,;
(2) physicians who, if they did not elect to participate in
the plan under section 353D.02, subdivision 2, would meet the
definition of member under section 353.01, subdivision 7; and to
(3) 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 under section 353D.02, subdivision 3.
(b) For purposes of this chapter, an elected local
government official includes a person appointed to fill a
vacancy in an elective office. Service as an elected local
government official only includes service for the governmental
subdivision for which the official was elected by the
public-at-large. Service as an elected local government
official ceases and eligibility to participate terminates when
the person ceases to be an elected official. An elected local
government official does not include an elected county sheriff.
Except as provided in section 353D.11, (c) Elected local
government officials, physicians, 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 public employees defined contribution plan.
(d) A former participant is a person who has ceased to be
an elected local government official or an emergency medical
service employee and who terminated eligible employment or
service and has not withdrawn the value of an the person's
individual account.
Sec. 2. Minnesota Statutes 1994, section 353D.02, is
amended to read:
353D.02 [ELECTION OF COVERAGE.]
Subdivision 1. [ELECTED LOCAL GOVERNMENT OFFICIALS.]
Eligible elected local government officials may elect to
participate in the defined contribution plan after being elected
or appointed to elective public office by filing a membership
application on a form prescribed by the executive director of
the association authorizing contributions to be deducted from
the elected official's salary. Participation begins on the
first day of the pay period for which the contributions were
deducted or, if pay period coverage dates are not provided, the
date on which the membership application or contributions are
received in the office of the association, whichever is received
first, provided further that the membership application is
received by the association within 60 days of the receipt of the
contributions. An election to participate in the plan is
revocable during incumbency.
Subd. 2. [ELIGIBLE PHYSICIAN.] Eligible physicians may
elect to participate in the defined contribution plan within 90
days of commencing employment with a government subdivision
under section 353.01, subdivision 6, by filing a membership
application on a form prescribed by the executive director of
the association authorizing contributions to be deducted from
the physician's salary. Participation begins on the first day
of the pay period for which the contributions were deducted. An
election to participate in the defined contribution plan is
irrevocable.
Subd. 3. [ELIGIBLE AMBULANCE SERVICE PERSONNEL.] Each
public ambulance service or privately operated ambulance service
with eligible personnel that receives an operating subsidy from
a governmental entity 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 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 revocable.
Sec. 3. Minnesota Statutes 1994, section 353D.03, is
amended to read:
353D.03 [FUNDING OF PLAN.]
(a) Subdivision 1. [LOCAL GOVERNMENT OFFICIAL
CONTRIBUTION.] 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) Subd. 2. [PHYSICIAN CONTRIBUTION.] An eligible
physician who elects to participate in the plan shall contribute
an amount equal to five percent of salary as defined in section
353.01, subdivision 10. The employer shall contribute a
matching amount.
Subd. 3. [AMBULANCE SERVICE PERSONNEL CONTRIBUTION.] 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.
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.
(c) Subd. 4. [PAYMENTS BY FORMER ELIGIBLE ELECTED
OFFICIALS.] Former participants eligible elected local
government officials in the defined contribution plan under this
chapter shall not contribute to the plan except under section
353D.12.
Sec. 4. Minnesota Statutes 1994, section 353D.04, is
amended to read:
353D.04 [CONTRIBUTIONS AND DEDUCTIONS IN ERROR.]
(a) Subdivision 1. [CREDITING OF ACCOUNT.] Contributions
made by or on behalf of a participating elected local government
official or physician must be remitted to the public employees
retirement association and credited to the individual account
established for the participant. (b) Ambulance service
contributions must be remitted on a regular basis to the
association together with any member contributions paid or
withheld. Those contributions must be credited to the
individual account of each participating member.
Subd. 2. [AUTHORITY TO ADOPT POLICIES.] The executive
director may adopt policies and procedures regarding deductions
taken totally or partially in error by the employer from the
salary of an elected official.
Sec. 5. [CURRENT ELIGIBLE PHYSICIANS.]
Subdivision 1. [EXERCISE OF OPTION.] As of the effective
date of this section, an eligible physician, who with respect to
current service is participating in the general employees
defined benefit plan administered by the public employees
retirement association, may elect to participate in the public
employees defined contribution plan and terminate further
participation in the general employees defined benefit plan.
The necessary election must be made within six months after the
effective date of this section.
Subd. 2. [REFUND OR DEFERRED ANNUITY.] An eligible
physician, who elects to transfer coverage under subdivision 1,
is deemed to have terminated public service for purposes of
Minnesota Statutes, 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.
A refund paid to an eligible physician under this section must
include employee contributions withheld from salary and omitted
employee contributions paid by the employee or employer under
Minnesota Statutes, section 353.27, subdivision 12.
Sec. 6. [DEFINED CONTRIBUTION AND DEFINED BENEFIT PLAN
STUDY.]
The legislative commission on pensions and retirement shall
report to the legislature by February 15, 1997, on the relative
advantages and disadvantages, including any federal taxation
considerations, of defined benefit pension plans and of defined
contribution pension plans.
Sec. 7. [REPEALER.]
Minnesota Statutes 1994, section 353D.11, is repealed.
Sec. 8. [EFFECTIVE DATE.]
Sections 1 to 7 are effective the day following final
enactment.
ARTICLE 7
INDIVIDUAL RETIREMENT ACCOUNT PLANS DEFINED
CONTRIBUTION PLAN COVERAGE FOR HISTORICAL
SOCIETY EMPLOYEES
Section 1. Minnesota Statutes 1995 Supplement, section
354D.02, subdivision 2, is amended to read:
Subd. 2. [ELIGIBILITY.] Eligible employees are:
(1) any supervisory or professional employee of the state
arts board; and
(2) any supervisory or professional employee of the
Minnesota humanities commission; or
(3) any employee of the Minnesota historical society.
Sec. 2. Minnesota Statutes 1995 Supplement, section
354D.03, is amended to read:
354D.03 [SOCIAL SECURITY COVERAGE.]
Plan participants remain are members of the general state
retirement plan for purposes of social security coverage only
remain, and are covered by the applicable agreement entered into
under section 355.02 but are not members of the general state
retirement plan for any other purpose while employed in covered
employment.
Sec. 3. Minnesota Statutes 1995 Supplement, section
354D.04, is amended to read:
354D.04 [PLAN COVERAGE.]
An election made under this section is irrevocable.
Eligible employees under section 354D.02, subdivision 2, shall
elect to participate in either the individual retirement account
plan or their respective retirement plan as follows:
(1) An eligible employee first employed after the effective
date of Laws 1994, chapter 508, in covered employment with no
prior allowable service as a member of the Minnesota state
retirement system, the public employees retirement association,
or the teachers retirement association may elect retirement
coverage under either their respective state retirement plan or
the individual retirement account plan within 60 days of the
start of covered employment. An election made under this
subdivision is irrevocable.
(2) An eligible employee with prior allowable service as a
member of the Minnesota state retirement system, the public
employees retirement association, or the teachers retirement
association may elect prospective coverage by the individual
retirement account plan. If individual retirement account plan
coverage is elected, accumulated employer and employee
contributions and allowable service credit shall remain with the
applicable retirement association or system. Notwithstanding
any provision of law to the contrary, an individual who has
transferred coverage for the same employment to the individual
retirement account plan is entitled to an augmented deferred
retirement annuity from the prior plan based on the amount
representing the employer and employee contributions made on the
individual's behalf in the retirement association or system in
which the individual was formerly enrolled without regard to
whether or not the individual meets the service credit vesting
requirements of the applicable retirement association or
system. An election made under this subdivision clause must be
made within 120 days and is irrevocable following the date the
eligible employee first becomes eligible to make the election.
Sec. 4. Minnesota Statutes 1995 Supplement, section
354D.06, is amended to read:
354D.06 [ADMINISTRATION.]
(a) The Minnesota state university system or its successor
shall administer the individual retirement account plan for
eligible employees listed in section 354D.02, subdivision 2,
clauses (1) and (2), in accordance with sections 354B.01 to
354B.05.
(b) The Minnesota historical society or its successor shall
administer the individual retirement account plan for eligible
employees listed in section 354D.02, subdivision 2, clause (3),
in accordance with section 354D.08.
Sec. 5. [354D.08] [INDIVIDUAL RETIREMENT ACCOUNT PLAN
ADMINISTRATION; MINNESOTA HISTORICAL SOCIETY.]
Subdivision 1. [GENERAL GOVERNANCE.] The Minnesota
historical society is the plan administrator and has the
administrative responsibility for the individual retirement
account plan for those eligible employees listed in section
354D.02, subdivision 2, clause (3).
Subd. 2. [ANNUITY CONTRACTS AND CUSTODIAL ACCOUNTS.] (a)
The plan administrator shall arrange for the purchase of fixed
annuity contracts, variable annuity contracts, a combination of
fixed and variable annuity contracts, or custodial accounts from
financial institutions which have been selected by the state
board of investment and approved by the plan administrator under
subdivision 3, as the investment vehicle for the retirement
coverage of plan participants and to provide retirement benefits
to plan participants. Custodial accounts from financial
institutions shall include open-end investment companies
registered under the federal Investment Company Act of 1940, as
amended.
(b) The annuity contracts or accounts must be purchased
with contributions under section 354D.05, or with money or
assets otherwise provided by law by authority of the Minnesota
historical society and deemed acceptable by the applicable
financial institution.
Subd. 3. [SELECTION OF FINANCIAL INSTITUTIONS.] The plan
administrator may approve up to two financial institutions
selected by the state board of investment under section 354B.25,
subdivision 3, to provide annuity products and custodial
accounts for those employees listed in section 354D.02,
subdivision 2, clause (3). Only those financial institutions
selected by the state board of investment and approved by the
plan administrator may provide annuity products and custodial
accounts for those employees listed in section 354D.02,
subdivision 2, clause (3).
The state board of investment must periodically review at
least every three years each financial institution selected.
The state board of investment may retain consulting services to
assist in the periodic review, may establish a budget for its
costs in the periodic review process, and may charge a
proportional share of those costs to each financial institution
selected. All contracts must be approved by the state board of
investment before execution by the Minnesota historical
society. The state board of investment shall also establish
policies and procedures under section 11A.04, clause (2), to
carry out this subdivision.
Subd. 4. [BENEFIT OWNERSHIP.] The retirement benefits
provided by the annuity contracts and custodial accounts of the
individual retirement account plan are held for the benefit of
plan participants and must be paid according to this chapter and
the plan document.
Subd. 5. [INDIVIDUAL RETIREMENT ACCOUNT PLAN
ADMINISTRATIVE EXPENSES; MINNESOTA HISTORICAL SOCIETY.] (a) The
reasonable and necessary administrative expenses of the
individual retirement account plan for those employees
enumerated in section 354D.02, subdivision 2, clause (3), must
be paid by plan participants. The plan administrator may charge
to plan participants purchasing annuity contracts and custodial
accounts pursuant to subdivision 2, paragraph (a), an
administrative expenses assessment of a designated amount, not
to exceed two percent of member and employer contributions, as
those contributions are made.
(b) Any administrative expense charge that is not actually
needed for the administrative expenses of the individual
retirement account plan must be refunded to member accounts.
Sec. 6. [EFFECTIVE DATE.]
Sections 1 to 5 are effective the day following final
enactment.
ARTICLE 8
VOLUNTEER FIREFIGHTER FIRE PREVENTION SERVICE
Section 1. Minnesota Statutes 1994, section 424A.001, is
amended by adding a subdivision to read:
Subd. 8. [FIREFIGHTING SERVICE.] "Firefighting service,"
if the applicable municipality approves for a fire department
that is a municipal department, or if the contracting
municipality or municipalities approve for a fire department
that is an independent nonprofit firefighting corporation,
includes service rendered by fire prevention personnel.
Sec. 2. Minnesota Statutes 1994, section 424A.001, is
amended by adding a subdivision to read:
Subd. 9. [SEPARATE FROM ACTIVE SERVICE.] "Separate from
active service" means to cease to perform fire suppression
duties, to cease to perform fire prevention duties, to cease to
supervise fire suppression duties, and to cease to supervise
fire prevention duties.
Sec. 3. Minnesota Statutes 1994, section 424A.01, is
amended by adding a subdivision to read:
Subd. 5. [FIRE PREVENTION PERSONNEL.] (a) If the fire
department is a municipal department and the applicable
municipality approves, or if the fire department is an
independent nonprofit firefighting corporation and the
contracting municipality or municipalities approve, the fire
department may employ or otherwise utilize the services of
persons as volunteer firefighters to perform fire prevention
duties and to supervise fire prevention activities.
(b) Personnel serving in fire prevention positions are
eligible to be members of the applicable volunteer firefighter
relief association and to qualify for service pension or other
benefit coverage of the relief association on the same basis as
fire department personnel who perform fire suppression duties.
(c) Personnel serving in fire prevention positions also are
eligible to receive any other benefits under the applicable law
or practice for services on the same basis as personnel employed
to perform fire suppression duties.
Sec. 4. Minnesota Statutes 1994, section 424A.02,
subdivision 1, is amended to read:
Subdivision 1. [AUTHORIZATION.] (a) 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.
(b) 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.
(c) 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.
(d) 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. 5. [EFFECTIVE DATE.]
Sections 1 to 4 are effective the day following final
enactment.
ARTICLE 9
SERVICE CREDIT DEADLINE EXTENSIONS
AND PURCHASES
Section 1. Laws 1995, chapter 252, article 1, section 16,
is amended to read:
Sec. 16. [RETROACTIVE PROVISIONS.]
(a) A teacher who had at least three years of allowable
service credit under Minnesota Statutes, chapter 354 or 354A, on
July 1, 1994, and who worked part-time between July 1, 1994, and
June 30, 1995, may be allowed to make contributions to and
accrue allowable service credit in the applicable retirement
fund, as if the teacher had been working full time, as provided
in Minnesota Statutes, sections 354.66, subdivision 4, and
354A.094, subdivision 4, for service after July 1, 1994, and
before June 30, 1995. If a teacher described in this paragraph
wishes to obtain allowable service credit as if the teacher had
been working full time for the period from July 1, 1994, to June
30, 1995, the teacher must:
(1) make a lump sum payment to the applicable pension fund
within 60 days after the effective date of this section before
August 2, 1996, with respect to the St. Paul teachers retirement
fund association, or before August 2, 1995, with respect to any
other teacher retirement plan, of the difference between the
amount of the employer and employee contributions to the pension
fund that would have been paid if the teacher had been working
full time, and that amount that was actually paid for part-time
service during that period; and
(2) submit to the association a letter or other document
from the board of the teacher's employing district stating that
the board would have agreed to the teacher's participation in
the part-time mobility program during the 1994-1995 school year
but for the requirement then in effect that the district make
the full employer contribution to the retirement fund for
teachers with 20 or more years of service, based on the
compensation that would have been paid if the teacher had been
employed on a full-time basis.
(b) An employer of a teacher covered by paragraph (a) must
notify the teacher of the option available under paragraph (a)
in writing within 30 days of the effective date of this
section before July 3, 1996, with respect to the St. Paul
teachers retirement fund association, or before July 3, 1995,
with respect to any other teacher retirement plan.
(c) With respect to the St. Paul teachers retirement fund
association, any payment must include compound interest at an
annual rate of 8.5 percent from August 3, 1995, to the date on
which payment is made.
Sec. 2. [STUDY OF REGIONAL TREATMENT CENTER AND RELATED
GOVERNMENTAL ENTITY EDUCATIONAL BREAKS-IN-SERVICE.]
The legislative commission on pensions and retirement shall
study the topic of the appropriate retirement coverage for
educational breaks-in-service to be accorded to state employees
who are employed by a regional treatment center, who terminated
state employment to undertake additional education with a
documented mutual expectation of rehiring upon completion of the
educational period, and who received a state stipend during the
educational period and to other comparably situated public
employees. The commission shall attempt to identify the
actuarial accrued liability associated with granting public
pension plan allowable service credit for these educational
break-in-service periods and shall determine the appropriate
manner of funding that liability. The commission shall report
the results of its study, including any recommendations in the
form of draft legislation, by March 1, 1997, to the chair of the
committee on governmental operations of the house of
representatives, the chair of the committee on governmental
operations and veterans of the senate, the chair of the
committee on ways and means of the house of representatives, and
the chair of the committee on finance of the senate.
Sec. 3. [INDEPENDENT SCHOOL DISTRICT NO. 553, NEW YORK
MILLS; PART-TIME TEACHER RETIREMENT COVERAGE PROGRAM DEADLINE
EXTENSION.]
(a) Notwithstanding any provision of Minnesota Statutes,
section 354.66, to the contrary, the teachers retirement
association must accept the application for full-time retirement
coverage filed by independent school district No. 553, New York
Mills, on or about October 13, 1995, for a person who:
(1) was born on May 16, 1945;
(2) was initially hired by the school district in 1968;
(3) served in the military from school years 1969-1970 to
1972-1973; and
(4) began work as a part-time computer technology teacher
on July 1, 1995.
A person who meets the requirements of clauses (1) to (4)
is entitled to full-time teacher retirement association coverage
under Minnesota Statutes, section 354.66, for the 1995-1996
school year if all other conditions of that section are met
beyond the failure of the school district to timely file the
application.
(b) A person who meets the requirements of paragraph (a),
clauses (1) to (4), for teaching services shall pay the
applicable employee contribution under Minnesota Statutes,
section 354.42, subdivision 2, on the difference between the
amount of the person's compensation from which employee
contributions were actually deducted and the amount of the
person's full-time equivalent salary under Minnesota Statutes,
section 354.66, subdivision 4.
(c) Independent school district No. 553, New York Mills,
shall pay the applicable employer and additional employer
contributions under Minnesota Statutes, section 354.42,
subdivisions 3 and 5, on the person's full-time equivalent
salary, plus interest at the rate of 8.5 percent. The school
district shall also pay interest at the rate of 8.5 percent on
the difference between the employee contributions actually
deducted from compensation and the amount of the person's
full-time equivalent salary under paragraph (b).
(d) The payments under paragraphs (b) and (c) must each be
made in a lump sum to the teachers retirement association before
June 30, 1996. If payment is made earlier than June 30, 1996,
interest must be calculated to the end of the month in which
payment is made.
Sec. 4. [INDEPENDENT SCHOOL DISTRICT NO. 200, HASTINGS;
PART-TIME TEACHER RETIREMENT COVERAGE PROGRAM DEADLINE
EXTENSION.]
(a) Notwithstanding any provision of Minnesota Statutes,
section 354.66, to the contrary, the teachers retirement
association must accept the application or applications for
full-time retirement coverage filed by independent school
district No. 200, Hastings, on or about February 5, 1996, for a
person who:
(1) was born on January 11, 1940;
(2) was initially hired by the school district on August
26, 1968; and
(3) was initially accepted by the school board for
participation in the qualified part-time teacher program under
Minnesota Statutes, section 354.66, on November 5, 1991.
A person who meets the requirements of clauses (1) to (3)
is entitled to full-time teacher retirement association coverage
under Minnesota Statutes, section 354.66, for the 1992-1993
through 1995-1996 school years if all other conditions of that
section are met beyond the failure of the school district to
timely file the applications.
(b) If full-time equivalent employee contributions have not
been received by the teachers retirement association, a person
who meets the requirements of paragraph (a), clauses (1) to (3),
for teaching services shall pay the applicable employee
contribution under Minnesota Statutes, section 354.42,
subdivision 2, on the difference between the amount of the
person's compensation from which employee contributions were
actually deducted and the amount of the person's full-time
equivalent salary under Minnesota Statutes, section 354.66,
subdivision 4.
(c) If full-time equivalent employer and additional
employer contributions have not been received previously by the
teachers retirement association, independent school district No.
200, Hastings, shall pay the applicable employer and additional
employer contributions under Minnesota Statutes, section 354.42,
subdivisions 3 and 5, on the difference, if any, between the
person's full-time equivalent salary and the salary upon which
contributions were made, plus interest at the rate of 8.5
percent compounded annually. The school district shall also pay
interest at the rate of 8.5 percent compounded annually on the
difference, if any, between the employee contributions actually
deducted from compensation and the employee contributions based
on the person's full-time equivalent salary under paragraph (b).
(d) The payments under paragraphs (b) and (c) must each be
made in a lump sum to the teachers retirement association before
June 30, 1996, or before the retirement of a person meeting the
requirements of paragraph (a), clauses (1) to (3), whichever is
earlier. If payment is made earlier than June 30, 1996,
interest must be calculated to the end of the month in which
payment is made.
Sec. 5. [MINNEAPOLIS TEACHERS RETIREMENT FUND ASSOCIATION;
ELIGIBILITY IN PART-TIME TEACHING PROGRAM FOR CERTAIN PART-TIME
TEACHERS.]
Notwithstanding any provision of Minnesota Statutes 1994,
section 354A.094, to the contrary, teachers in special school
district No. 1, Minneapolis, who were granted a part-time
position under Minnesota Statutes, section 354A.094, after June
30, 1994, but who were compensated in an amount that exceeded 67
percent of the compensation rate established by the board for a
full-time teacher with identical education and experience within
the district and who applied for and were approved by special
school district No. 1, Minneapolis, for the 1994-1995 school
year to participate in the qualified part-time teacher program
must be allowed to make, by June 30, 1996, the full-time
employee and employer contribution for the 1994-1995 school year
and receive service credit from the Minneapolis teachers
retirement fund association in amounts according to those
prescribed in Minnesota Statutes, sections 354A.094 and 354A.12.
Sec. 6. [MINNEAPOLIS TEACHERS RETIREMENT FUND ASSOCIATION;
PURCHASE OF PRIOR SERVICE CREDIT.]
Subdivision 1. [ELIGIBILITY; FORMER MINNEAPOLIS
TEACHER.] (a) Notwithstanding Laws 1992, chapter 598, article 6,
section 19, an eligible person who was:
(1) born on January 4, 1930;
(2) employed as a typing teacher in the adult education
program at Bryant junior high school in Minneapolis in September
1969;
(3) employed as a reserve teacher in special school
district No. 1 from January 1, 1970, until May 30, 1970; and
(4) employed from June 1, 1970, to 1978, as a business
education teacher at the occupational skills training center in
Minneapolis;
may purchase allowable service credit in the basic program of
the Minneapolis teachers retirement fund association for the
period described in paragraph (b) by paying the amount specified
in subdivision 3.
(b) The service credit purchase is for the period or
periods of uncovered eligible service from September 1969 until
the commencement of Minneapolis teachers retirement association
fund coverage in 1974 for which membership was mandatory, or for
which coverage was at the employee's option, unless it can be
demonstrated that the person described in paragraph (a) waived
that coverage.
Subd. 2. [PURCHASE PAYMENT AMOUNT.] (a) To purchase credit
for prior eligible service under subdivision 1, there must be
paid to the Minneapolis teachers retirement fund association an
amount equal to the present value of the amount of the
additional retirement annuity obtained by purchase of the
additional service credit.
(b) Calculation of this amount must be made by the
executive director of the Minneapolis teachers retirement fund
association using the applicable preretirement interest rate
specified in Minnesota Statutes, section 356.215, subdivision
4d, and the mortality table adopted for the retirement
association. The calculation must assume 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.
(c) The person making the purchase 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 retirement association.
(d) Payment of the amount calculated under this subdivision
is the obligation of the eligible individual in subdivision 1
and must be made prior to July 1, 1996, in a lump sum. However,
the current or former employer of the eligible individual 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 8.5
percent per year compounded annually from the date on which the
contributions would otherwise have been made to the date on
which the payment is made. If the employer agrees to payments
under this paragraph, the employee must make the employee
payments required under this paragraph prior to July 1, 1996.
If that employee payment is made, the employing unit payment
under this paragraph must be remitted to the executive director
of the retirement association within 60 days of receipt by the
executive director of the employee payments specified under this
paragraph.
Subd. 3. [SERVICE CREDIT GRANT.] Service credit for the
purchase period or periods must be granted to the account of the
eligible person upon receipt of the purchase payment amount
specified in subdivision 2.
Sec. 7. [ELECTION OF PUBLIC EMPLOYEE RETIREMENT
ASSOCIATION COVERAGE.]
Subdivision 1. Notwithstanding Minnesota Statutes, section
353.01, subdivision 2b, clause (14), to the contrary, a Kanabec
hospital employee born on December 6, 1940, employed by the
hospital from January 4, 1965, to the present, and a Kanabec
hospital employee born on October 6, 1942, employed by the
hospital from September, 1964, to August 1, 1966, and from May,
1967, to the present, is eligible to make the election under
subdivision 2.
Subd. 2. [ELECTION OF COVERAGE.] An eligible employee
under subdivision 1 is entitled to elect retirement coverage by
the public employees retirement association general plan.
Service credit will begin to accrue at the beginning of the pay
period following the election of plan coverage by the eligible
employee. The election of coverage must be made on a form
prescribed by the executive director of the association. The
election must be made within 60 days after the effective date of
this section.
Sec. 8. [REPEALER.]
Laws 1990, chapter 570, article 13, section 1, subdivision
5, is repealed.
Sec. 9. [EFFECTIVE DATE.]
Sections 1 to 6 and 8 are effective the day following final
enactment. Section 7 is effective upon approval by the Kanabec
county board and upon compliance with Minnesota Statutes,
section 645.021.
ARTICLE 10
VOLUNTEER FIREFIGHTER RELIEF ASSOCIATION
INVESTMENT PERFORMANCE REPORTING
Section 1. Minnesota Statutes 1995 Supplement, section
356.219, subdivision 2, is amended to read:
Subd. 2. [CONTENT AND TIMING OF REPORTS.] (a) The
following information shall be included in the report required
by subdivision 1:
(1) the market value of all investments at the close of the
reporting period;
(2) regular payroll-based contributions to the fund;
(3) other contributions and revenue paid into the fund,
including, but not limited to, state or local non-payroll-based
contributions, repaid refunds, and buybacks;
(4) total benefits paid to members;
(5) fees paid for investment management services;
(6) salaries and other administrative expenses paid; and
(7) total return on investment.
The report must also include a written statement of the
investment policy in effect on June 30, 1988, and any investment
policy changes made subsequently and shall include the effective
date of each policy change. The information required under this
subdivision must be reported separately for each investment
account or investment portfolio included in the pension fund.
(b) For public pension plans other than volunteer
firefighters' relief associations governed by sections 69.77 or
69.771 to 69.775, the information specified in paragraph (a)
must be provided separately for each quarter for the fiscal
years of the pension fund ending during calendar years 1989
through 1991 and on a monthly basis thereafter. For volunteer
firefighters' relief associations governed by sections 69.77 or
69.771 to 69.775, the information specified in paragraph (a)
must be provided separately each quarter.
(c) Firefighters' relief associations that have assets with
a market value of less than $300,000 must submit a written
statement of their current investment policy on or before
October 1, 1996, must report any subsequent investment policy
changes, including the effective date of the change, within 90
days of the change, must begin collecting the required
information under paragraph (a), clauses (1) to (7), on January
1, 1996 1997, and must submit the required information to the
state auditor on or before October 1, 1997 1998, and
subsequently within six months of the end of each fiscal year.
Other associations must submit the required information through
fiscal year 1993 to the state auditor on or before October 1,
1994, and subsequently within six months of the end of each
fiscal year.
Sec. 2. Minnesota Statutes 1994, 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.
(f) The chief administrative officer of each covered
pension plan, by January 15, annually, shall transmit a copy of
all statements of economic interest received by the plan under
this subdivision during the preceding 12 months to the ethical
practices board.
Sec. 3. [REVIEW OF INVESTMENT PERFORMANCE ATTRIBUTION
REPORTING FORMS AND REPORTING PROCESS.]
(a) On or before February 15, 1997, the special task force
established in paragraph (b) shall report to the legislature on
its review of the investment performance attribution reporting
forms and reporting process as provided in paragraph (d).
(b) The special task force consists of:
(1) the chair of the legislative commission on pensions and
retirement or the chair's designee;
(2) the vice-chair of the legislative commission on
pensions and retirement or the vice-chair's designee;
(3) the chair of the committee on governmental operations
of the house of representatives or the chair's designee;
(4) the chair of the committee on governmental operations
and veterans of the senate or the chair's designee;
(5) the executive director of the state board of investment
or the director's designee;
(6) the state auditor or the auditor's designee;
(7) two persons who are each a volunteer firefighter member
of the board of trustees of a volunteer firefighter relief
association deemed representative of its membership and
designated by the governing board of the Minnesota area relief
association coalition;
(8) two persons who are each a volunteer firefighter member
of the board of trustees of a volunteer firefighter relief
association deemed representative of its membership and
designated by the governing board of the Minnesota state fire
chiefs association;
(9) two persons who are each a volunteer firefighter member
of the board of trustees of a volunteer firefighter relief
association deemed representative of its membership and
designated by the governing board of the Minnesota state fire
department association;
(10) a person who is a municipal representative on a board
of trustees of a volunteer firefighters relief association with
assets under $300,000 as designated by the executive director of
the league of Minnesota cities;
(11) a representative of a first class city teacher
retirement fund association as designated by the chair of the
legislative commission on pensions and retirement; and
(12) a representative of a local police or salaried
firefighter relief association governed by Minnesota Statutes,
section 69.77 as designated by the chair of the legislative
commission on pensions and retirement.
(c) The chair of the special task force is the chair of the
legislative commission on pensions and retirement or the chair's
designee and the chair shall establish the meeting schedule and
topic agenda for the special task force.
(d) The special task force, at a minimum, shall consider
the following topics and issues:
(1) the changes required to simplify the investment
performance attribution reporting under Minnesota Statutes,
section 356.219, for smaller local pension plans;
(2) the changes required to include the investment
performance attribution reporting in the annual financial
reporting under Minnesota Statutes, section 69.051;
(3) the changes required to combine the investment
performance reporting under Minnesota Statutes, section 356.218,
with the investment performance attribution reporting under
Minnesota Statutes, section 356.219, and the appropriate entity
to administer any combined reporting program; and
(4) any other topics relevant to the investment reporting
programs under Minnesota Statutes, section 356.218 or 356.219.
Sec. 4. [EFFECTIVE DATE.]
This article is effective the day following final enactment.
Presented to the governor April 2, 1996
Signed by the governor April 3, 1996, 3:57 p.m.
Official Publication of the State of Minnesota
Revisor of Statutes