1.1 	A bill for an act
1.2 	relating to retirement; Teachers Retirement Association; revising deferred 
1.3 	annuity augmentation rates for certain deferred annuitants; amending Minnesota 
1.4 	Statutes 2010, section 354.55, subdivision 11.
1.5 	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

1.6 	Section 1. Minnesota Statutes 2010, section 354.55, subdivision 11, is amended to read:
1.7 		Subd. 11.Deferred annuity; augmentation. (a) Any person covered under section 
1.8 	354.44, subdivision 6, who ceases to render teaching service, may leave the person's 
1.9 	accumulated deductions in the fund for the purpose of receiving a deferred annuity 
1.10 	at retirement.
1.11 	(b) The amount of the deferred retirement annuity is determined by section 354.44, 
1.12 	subdivision 6, and augmented as provided in this subdivision. The required reserves for 
1.13 	the annuity which had accrued when the member ceased to render teaching service must 
1.14 	be augmented, as further specified in this subdivision, by the applicable interest raterates 
1.15 	compounded annually from the first day of the month following the month during which 
1.16 	the member ceased to render teaching service to the effective date of retirement.
1.17 	(c) No augmentation is not creditable if the deferral period is less than three months 
1.18 	or if deferral commenced before July 1, 1971.
1.19 	(d) For persons who became covered employeesmembers before July 1, 2006, and 
1.20 	who terminated service before May 15, 2010, with a deferral period commencing after 
1.21 	June 30, 1971, the annuity must be augmented as follows:
1.22 	(1) five percent interest compounded annually until January 1, 1981;
1.23 	(2) three percent interest compounded annually from January 1, 1981, until January 
1.24 	1 of the year following the year in which the deferred annuitant attains age 55; and
2.1 	(3) five percent interest compounded annually from the date established in clause (2) 
2.2 	to the effective date of retirement.
2.3 	(e) For persons who became members before July 1, 2006, and who terminate 
2.4 	service after May 14, 2010, the annuity must be augmented as follows:
2.5 	(1) three percent interest compounded annually to January 1 of the year following 
2.6 	the year in which the deferred annuitant attains age 55;
2.7 	(2) five percent interest compounded annually from the date established in clause (1) 
2.8 	to the effective date of retirement or until June 30, 2012, whichever is earlier; and
2.9 	(4)(3) two percent interest compounded annually after June 30, 2012, to the 
2.10 	effective date of retirement.
2.11 	(f) For persons who became members after June 30, 2006, and who terminated 
2.12 	service before May 15, 2010, the interest rate used to augment the deferred annuity is 2.5 
2.13 	percent interest compounded annually to the effective date of retirement.
2.14 	(e)(g) For persons who become covered employees after June 30, 2006, and who 
2.15 	terminate service after May 14, 2010, the interest rate used to augment the deferred 
2.16 	annuity is 2.5 percent interest compounded annually until June 30, 2012, or until the 
2.17 	effective date of retirement, whichever is earlier, and two percent interest compounded 
2.18 	annually after June 30, 2012, to the effective date of retirement.
2.19 	(f)(h) If a person has more than one period of uninterrupted service, a separate 
2.20 	average salary determined under section 354.44, subdivision 6, must be used for each 
2.21 	period and the required reserves related to each period must be augmented as specified in 
2.22 	this subdivision. The sum of the augmented required reserves is the present value of the 
2.23 	annuity. For the purposes of this subdivision, "period of uninterrupted service" means a 
2.24 	period of covered teaching service during which the member has not been separated from 
2.25 	active service for more than one fiscal year.
2.26 	(g)(i) If a person repays a refund, the service restored by the repayment must 
2.27 	be considered as continuous with the next period of service for which the person has 
2.28 	allowable service credit in the Teachers Retirement Association.
2.29 	(h)(j) If a person does not render teaching service in any one fiscal year or more 
2.30 	consecutive fiscal years and then resumes teaching service, the formula percentages used 
2.31 	from the date of the resumption of teaching service must be those applicable to new 
2.32 	members.
2.33 	(i)(k) The mortality table and interest rate actuarial assumption used to compute 
2.34 	the annuity must be the applicable mortality table established by the board under section 
2.35 	354.07, subdivision 1, and the interest rate actuarial assumption under section 356.215 in 
2.36 	effect when the member retires.
3.1 	(j)(l) In no case may the annuity payable under this subdivision be less than the 
3.2 	amount of annuity payable under section 354.44, subdivision 6.
3.3 	(k)(m) The requirements and provisions for retirement before normal retirement 
3.4 	age contained in section 354.44, subdivision 6, also apply to an employee fulfilling the 
3.5 	requirements with a combination of service as provided in section 354.60.
3.6 	(l)(n) The augmentation provided by this subdivision applies to the benefit provided 
3.7 	in section 354.46, subdivision 2.
3.8 	(m)(o) The augmentation provided by this subdivision does not apply to any period 
3.9 	in which a person is on an approved leave of absence from an employer unit covered 
3.10 	by the provisions of this chapter.
3.11 	(n)(p) The retirement annuity or disability benefit of, or the survivor benefit payable 
3.12 	on behalf of, a former teacher who terminated service before July 1, 1997, which is not 
3.13 	first payable until after June 30, 1997, must be increased on an actuarial equivalent basis 
3.14 	to reflect the change in the postretirement interest rate actuarial assumption under section 
3.15 	356.215, subdivision 8, from five percent to six percent under a calculation procedure and 
3.16 	tables adopted by the board as recommended by an approved actuary and approved by the 
3.17 	actuary retained under section 356.214.

3.18 	EFFECTIVE DATE. This section is effective the day following final enactment.