Minnesota Session Laws - 2007, Regular Session

CHAPTER 14--S.F.No. 60

An act

relating to local government; authorizing the city of Duluth to establish accounts to pay for postemployment benefits owed to retired employees and to generate revenue dedicated to meet certain city obligations; appropriating money;

proposing coding for new law in Minnesota Statutes, chapters 11A; 353.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

Section 1.

new text begin [11A.235] ACCOUNT FOR INVESTMENT OF CERTAIN DULUTH FUNDS OR ASSETS. new text end

new text begin Subdivision 1. new text end

new text begin Establishment. new text end

new text begin The State Board of Investment, when requested by the city of Duluth, may invest the funds or assets of the city's community investment trust fund in a special account for that purpose in the combined investment funds established in section 11A.14, subject to the policies and procedures established by the State Board of Investment. Use of the funds in the account is restricted to debt service payments for the city's street improvement program or to any other use approved in accordance with Section 54(E) of the home rule charter of the city of Duluth. new text end

new text begin Subd. 2. new text end

new text begin Account maintenance and investment. new text end

new text begin The city may deposit money in the account and may withdraw money from the account for purposes approved by the Duluth City Council in accordance with Section 54(E) of the home rule charter of the city of Duluth. Such transactions must be at a time and in a manner required by the executive director of the State Board of Investment. Investment earnings must be credited to the account of the city. The account may be terminated by the city at any time. new text end

new text begin EFFECTIVE DATE; LOCAL APPROVAL. new text end

new text begin This section is effective the day following the day on which the chief clerical officer of the city of Duluth timely completes its compliance with Minnesota Statutes, section 645.021, subdivision 3, following approval by the Duluth City Council in compliance with Minnesota Statutes, section 645.021, subdivision 2. new text end

Sec. 2.

new text begin [353.95] ACCOUNT FOR DULUTH POSTEMPLOYMENT BENEFITS. new text end

new text begin Subdivision 1. new text end

new text begin Establishment. new text end

new text begin The Public Employees Retirement Association may administer an account representing the irrevocable trust fund established by the city of Duluth to be used only to fund and pay for the postemployment benefits owed to retired employees in accordance with language contained in labor agreements between the city and its employee bargaining units, or between participating subgroups in the city's health plan and their retirees. The city of Duluth investment committee shall serve as trustee of the irrevocable trust. new text end

new text begin Subd. 2. new text end

new text begin Definition. new text end

new text begin For purposes of this section, "postemployment benefit" means a benefit giving rise to a liability under Statement 45 of the Governmental Accounting Standards Board, and therefore does not include benefits to be paid by a Minnesota public pension plan listed in section 356.20, subdivision 2, or 356.30, subdivision 3, and benefits provided on a defined contribution individual account basis. new text end

new text begin Subd. 3. new text end

new text begin Account maintenance and investment. new text end

new text begin (a) The Public Employees Retirement Association may charge the city fees for reasonable administrative costs, and the amount of those fees is appropriated to the association from the account. The Public Employees Retirement Association may establish other terms and conditions for participation in the account. new text end

new text begin (b) The Public Employees Retirement Association must certify all money in the account to the State Board of Investment for investment in the combined investment funds established in section 11A.14, subject to the policies and procedures established by the State Board of Investment. Investment earnings must be credited to the account of the city. At least quarterly, the State Board of Investment shall provide to the city of Duluth the total rate of return for the assets invested by the board for the city of Duluth under this section. The State Board of Investment shall also include in its annual report the annual total rate of return results for those assets. new text end

new text begin Subd. 4. new text end

new text begin Management and termination of account. new text end

new text begin The city may deposit money in the account and may withdraw money from the account as needed for postemployment benefits owed on behalf of retired employees of the city or its subgroups. Such transactions must be at a time and in a manner required by the executive director of the Public Employees Retirement Association. The city of Duluth must ensure that the investment and management of the assets complies with the prudent investor rule in section 501B.151 and that withdrawals comply with the requirements of this section. The account may be terminated only to the extent the city's postemployment benefit actuarial liability is satisfied or otherwise defeased. The city shall file with the state auditor an investment policy statement under section 356.219, subdivision 3, paragraph (a). new text end

new text begin Subd. 5. new text end

new text begin Status of irrevocable fund. new text end

new text begin (a) All money in the account representing the irrevocable fund created in this section is held in trust for the exclusive benefit of retired employees of the city and of subgroups participating in the city's health plan, and is not subject to claims by creditors of the state, the city, the city's subgroups, or the current and former employees of the city or its subgroups. new text end

new text begin (b) The irrevocable trust fund underlying the account created in this section must be deemed an arrangement equivalent to a trust for all legal purposes. new text end

new text begin EFFECTIVE DATE; LOCAL APPROVAL. new text end

new text begin This section is effective the day following the day on which the chief clerical officer of the city of Duluth timely completes its compliance with Minnesota Statutes, section 645.021, subdivision 3, following approval by the Duluth City Council in compliance with Minnesota Statutes, section 645.021, subdivision 2. new text end

Sec. 3.

new text begin INTENT AND PURPOSE; NO PRECEDENT. new text end

new text begin (a) Sections 1 and 2 are intended to resolve specific expenditure and funding issues that have arisen in the city of Duluth. new text end

new text begin (b) Nothing in sections 1 and 2 may be interpreted as establishing a precedent for potential solutions to postemployment benefit expenditure and funding problems in other jurisdictions that may be fashioned by the 2007 legislature. new text end

Presented to the governor March 30, 2007

Signed by the governor March 30, 2007, 5:15 p.m.