2002 Minnesota Statutes

     353.01 Definitions. 

    Subdivision 1.    Terms.  Unless the language or context 
 clearly indicates that a different meaning is intended, each of 
 the following terms, for the purposes of this chapter, has the 
 meaning given it. 

    Subd. 2.    Public employee.  "Public employee" means a 
 governmental employee performing personal services for a 
 governmental subdivision defined in subdivision 6, whose salary 
 is paid, in whole or in part, from revenue derived from 
 taxation, fees, assessments, or from other sources.  The term 
 includes the classes of persons described or listed in 
 subdivision 2a.  The term also includes persons who elect 
 association membership under subdivision 2d, paragraph (a), and 
 persons for whom the applicable governmental subdivision had 
 elected association membership under subdivision 2d, paragraph 
 (b).  The term excludes the classes of persons listed in 
 subdivision 2b for purposes of membership in the association.  

    Subd. 2a.    Included employees.  (a) Public employees 
 whose salary from one governmental subdivision exceeds $425 in 
 any month shall participate as members of the association.  If 
 the salary is less than $425 in a subsequent month, the employee 
 retains membership eligibility.  Eligible public employees shall 
 participate as members of the association with retirement 
 coverage by the public employees retirement plan or the public 
 employees police and fire retirement plan under this chapter, or 
 the local government correctional employees retirement plan 
 under chapter 353E, whichever applies, as a condition of their 
 employment on the first day of employment unless they: 

    (1) are specifically excluded under subdivision 2b; 

    (2) do not exercise their option to elect retirement 
 coverage in the association as provided in subdivision 2d, 
 paragraph (a); or 

    (3) are employees of the governmental subdivisions listed 
 in subdivision 2d, paragraph (b), where the governmental 
 subdivision has not elected to participate as a governmental 
 subdivision covered by the association. 

    (b) A public employee who was a member of the association 
 on June 30, 2002, based on employment that qualified for 
 membership coverage by the public employees retirement plan or 
 the public employees police and fire plan under this chapter, or 
 the local government correctional employees retirement plan 
 under chapter 353E as of June 30, 2002, retains that membership 
 until the employee terminates public employment under 
 subdivision 11a or terminates membership under subdivision 11b. 

    Subd. 2b.    Excluded employees.  The following public 
 employees are not eligible to participate as members of the 
 association with retirement coverage by the public employees 
 retirement plan, the local government correctional employees 
 retirement plan under chapter 353E, or the public employees 
 police and fire retirement plan: 

    (1) public officers, other than county sheriffs, who are 
 elected to a governing body, or persons who are appointed to 
 fill a vacancy in an elective office of a governing body, whose 
 term of office first commences on or after July 1, 2002, for the 
 service to be rendered in that elective position.  Elected 
 governing body officials who were active members of the 
 association's coordinated or basic retirement plans as of June 
 30, 2002, continue participation throughout incumbency in office 
 until termination of public service occurs as defined in 
 subdivision 11a; 

    (2) election officers or election judges; 

    (3) patient and inmate personnel who perform services for a 
 governmental subdivision; 

    (4) employees who are hired for a temporary position under 
 subdivision 12a, and employees who resign from a nontemporary 
 position and accept a temporary position within 30 days in the 
 same governmental subdivision.  An employer must not apply the 
 definition of temporary position so as to exclude employees who 
 are hired to fill positions that are permanent or that are for 
 an unspecified period but who are serving a probationary period 
 at the start of the employment.  If the period of employment 
 extends beyond six consecutive months and the employee earns 
 more than $425 from one governmental subdivision in any calendar 
 month, the department head shall report the employee for 
 membership and require employee deductions be made on behalf of 
 the employee under section 353.27, subdivision 4. 

    The membership eligibility of an employee who resigns or is 
 dismissed from a temporary position and within 30 days accepts 
 another temporary position in the same governmental subdivision 
 is determined on the total length of employment rather than on 
 each separate position.  Membership eligibility of an employee 
 who holds concurrent temporary and nontemporary positions in one 
 governmental subdivision is determined by the length of 
 employment and salary of each separate position; 

    (5) employees who are employed by reason of work emergency 
 caused by fire, flood, storm, or similar disaster; 

    (6) employees who by virtue of their employment in one 
 governmental subdivision are required by law to be a member of 
 and to contribute to any of the plans or funds administered by 
 the Minnesota state retirement system, the teachers retirement 
 association, the Duluth teachers retirement fund association, 
 the Minneapolis teachers retirement association, the St. Paul 
 teachers retirement fund association, the Minneapolis employees 
 retirement fund, or any police or firefighters relief 
 association governed by section 69.77 that has not consolidated 
 with the public employees retirement association, or any local 
 police or firefighters consolidation account but who have not 
 elected the type of benefit coverage provided by the public 
 employees police and fire fund under sections 353A.01 to 
 353A.10, or any persons covered by section 353.665, subdivision 
 4, 5, or 6, who have not elected public employees police and 
 fire plan benefit coverage.  This clause must not be construed 
 to prevent a person from being a member of and contributing to 
 the public employees retirement association and also belonging 
 to and contributing to another public pension fund for other 
 service occurring during the same period of time.  A person who 
 meets the definition of "public employee" in subdivision 2 by 
 virtue of other service occurring during the same period of time 
 becomes a member of the association unless contributions are 
 made to another public retirement fund on the salary based on 
 the other service or to the teachers retirement association by a 
 teacher as defined in section 354.05, subdivision 2; 

    (7) persons who are members of a religious order and are 
 excluded from coverage under the federal Old Age, Survivors, 
 Disability, and Health Insurance Program for the performance of 
 service as specified in United States Code, title 42, section 
 410(a)(8)(A), as amended through January 1, 1987, if no 
 irrevocable election of coverage has been made under section 
 3121(r) of the Internal Revenue Code of 1954, as amended; 

    (8) employees of a governmental subdivision who have not 
 reached the age of 23 and are enrolled on a full-time basis to 
 attend or are attending classes on a full-time basis at an 
 accredited school, college, or university in an undergraduate, 
 graduate, or professional-technical program, or a public or 
 charter high school; 

    (9) resident physicians, medical interns, and pharmacist 
 residents and pharmacist interns who are serving in a degree or 
 residency program in public hospitals; 

    (10) students who are serving in an internship or residency 
 program sponsored by an accredited educational institution; 

    (11) persons who hold a part-time adult supplementary 
 technical college license who render part-time teaching service 
 in a technical college; 

    (12) except for employees of Hennepin county, foreign 
 citizens working for a governmental subdivision with a work 
 permit of less than three years, or an H-1b visa valid for less 
 than three years of employment.  Upon notice to the association 
 that the work permit or visa extends beyond the three-year 
 period, the foreign citizens are to be reported for membership 
 from the date of the extension; 

    (13) public hospital employees who elected not to 
 participate as members of the association before 1972 and who 
 did not elect to participate from July 1, 1988, to October 1, 
 1988; 

    (14) except as provided in section 353.86, volunteer 
 ambulance service personnel, as defined in subdivision 35, but 
 persons who serve as volunteer ambulance service personnel may 
 still qualify as public employees under subdivision 2 and may be 
 members of the public employees retirement association and 
 participants in the public employees retirement fund or the 
 public employees police and fire fund, whichever applies, on the 
 basis of compensation received from public employment service 
 other than service as volunteer ambulance service personnel; 

    (15) except as provided in section 353.87, volunteer 
 firefighters, as defined in subdivision 36, engaging in 
 activities undertaken as part of volunteer firefighter duties; 
 provided that a person who is a volunteer firefighter may still 
 qualify as a public employee under subdivision 2 and may be a 
 member of the public employees retirement association and a 
 participant in the public employees retirement fund or the 
 public employees police and fire fund, whichever applies, on the 
 basis of compensation received from public employment activities 
 other than those as a volunteer firefighter; 

    (16) pipefitters and associated trades personnel employed 
 by independent school district No. 625, St. Paul, with coverage 
 under a collective bargaining agreement by the pipefitters local 
 455 pension plan who were either first employed after May 1, 
 1997, or, if first employed before May 2, 1997, elected to be 
 excluded under Laws 1997, chapter 241, article 2, section 12; 

    (17) electrical workers, plumbers, carpenters, and 
 associated trades personnel employed by independent school 
 district No. 625, St. Paul, or the city of St. Paul, who have 
 retirement coverage under a collective bargaining agreement by 
 the electrical workers local 110 pension plan, the united 
 association plumbers local 34 pension plan, or the carpenters 
 local 87 pension plan who were either first employed after May 
 1, 2000, or, if first employed before May 2, 2000, elected to be 
 excluded under Laws 2000, chapter 461, article 7, section 5; 

    (18) bricklayers, allied craftworkers, cement masons, 
 glaziers, glassworkers, painters, allied tradesworkers, and 
 plasterers employed by the city of St. Paul or independent 
 school district No. 625, St. Paul, with coverage under a 
 collective bargaining agreement by the bricklayers and allied 
 craftworkers local 1 pension plan, the cement masons local 633 
 pension plan, the glaziers and glassworkers local L-1324 pension 
 plan, the painters and allied trades local 61 pension plan, or 
 the Twin Cities plasterers local 265 pension plan who were 
 either first employed after May 1, 2001, or if first employed 
 before May 2, 2001, elected to be excluded under Laws 2001, 
 First Special Session chapter 10, article 10, section 6; 

    (19) plumbers employed by the metropolitan airports 
 commission, with coverage under a collective bargaining 
 agreement by the plumbers local 34 pension plan, who either were 
 first employed after May 1, 2001, or if first employed before 
 May 2, 2001, elected to be excluded under Laws 2001, First 
 Special Session chapter 10, article 10, section 6; 

    (20) employees who are hired after June 30, 2002, to fill 
 seasonal positions under subdivision 12b which are limited in 
 duration by the employer to 185 consecutive calendar days or 
 less in each year of employment with the governmental 
 subdivision; 

    (21) persons who are provided supported employment or 
 work-study positions by a governmental subdivision and who 
 participate in an employment or industries program maintained 
 for the benefit of these persons where the governmental 
 subdivision limits the position's duration to three years or 
 less, including persons participating in a federal or state 
 subsidized on-the-job training, work experience, senior citizen, 
 youth, or unemployment relief program where the training or work 
 experience is not provided as a part of, or for, future 
 permanent public employment; 

    (22) independent contractors and the employees of 
 independent contractors; and 

    (23) reemployed annuitants of the association during the 
 course of that reemployment. 

*   NOTE:  Based on a certificate of local approval filed with 
*the secretary of state on July 25, 2002, the amendment to clause 
*(12) is effective July 26, 2002.  Laws 2002, chapter 392, 
*article 3, section 11, paragraph (c). 

    Subd. 2c. Repealed, 1989 c 319 art 3 s 26 

    Subd. 2d.    Optional membership.  (a) Membership in the 
 association is optional by action of the individual employee for 
 the following public employees who meet the conditions set forth 
 in subdivision 2a: 

    (1) members of the coordinated plan who are also employees 
 of labor organizations as defined in section 353.017, 
 subdivision 1, for their employment by the labor organization 
 only if they elect to have membership under section 353.017, 
 subdivision 2; 

    (2) persons who are elected or persons who are appointed to 
 elected positions other than local governing body elected 
 positions who elect to participate by filing a written election 
 for membership; 

    (3) members of the association who are appointed by the 
 governor to be a state department head and who elect not to be 
 covered by the general state employees retirement plan of the 
 Minnesota state retirement system under section 352.021; and 

    (4) city managers as defined in section 353.028, 
 subdivision 1, who do not elect to be excluded from membership 
 in the association under section 353.028, subdivision 2. 

    (b) Membership in the association is optional by action of 
 the governmental subdivision for the employees of the following 
 governmental subdivisions under the conditions specified: 

    (1) the Minnesota association of townships if the board of 
 the association, at its option, certifies to the executive 
 director that its employees are to be included for purposes of 
 retirement coverage, in which case the status of the association 
 as a participating employer is permanent; and 

    (2) a county historical society if the county in which the 
 historical society is located, at its option, certifies to the 
 executive director that the employees of the historical society 
 are to be county employees for purposes of retirement coverage 
 under this chapter.  The status as a county employee must be 
 accorded to all similarly situated county historical society 
 employees and, once established, must continue as long as a 
 person is an employee of the county historical society. 

    (c) For employees who are covered by paragraph (a), clause 
 (1), (2), or (3), or covered by paragraph (b), if the necessary 
 membership election is not made, the employee is excluded from 
 retirement coverage under this chapter.  For employees who are 
 covered by paragraph (a), clause (4), if the necessary election 
 is not made, the employee must become a member and have 
 retirement coverage under this chapter.  The option to become a 
 member, once exercised under this subdivision, may not be 
 withdrawn until termination of public service as defined under 
 subdivision 11a. 

    Subd. 3.    Head of department.  "Head of department" 
 means the head of any department, institution, office, or branch 
 of service of any governmental subdivision which directly pays 
 salaries out of its revenue or is empowered to authorize the 
 payment of such salaries. 

    Subd. 4.    Accumulated deductions.  "Accumulated 
 deductions" means the total of the amounts deducted from the 
 salary of a member, exclusive of interest, and the total of the 
 amounts paid by a member in lieu of such deductions and credited 
 to the member's individual account in the retirement fund. 

    Subd. 5.  Repealed, 1971 c 106 s 40 

    Subd. 6.    Governmental subdivision.  (a) "Governmental 
 subdivision" means a county, city, town, school district within 
 this state, or a department or unit of state government, or any 
 public body whose revenues are derived from taxation, fees, 
 assessments or from other sources. 

    (b) Governmental subdivision also means the public 
 employees retirement association, the league of Minnesota 
 cities, the association of metropolitan municipalities, public 
 hospitals owned or operated by, or an integral part of, a 
 governmental subdivision or governmental subdivisions, the 
 association of Minnesota counties, the metropolitan intercounty 
 association, the Minnesota municipal utilities association, the 
 metropolitan airports commission, the Minneapolis employees 
 retirement fund for employment initially commenced after June 
 30, 1979, the range association of municipalities and schools, 
 soil and water conservation districts, economic development 
 authorities created or operating under sections 469.090 to 
 469.108, the Spring Lake Park fire department, incorporated, and 
 the Dakota county agricultural society. 

    (c) Governmental subdivision does not mean any municipal 
 housing and redevelopment authority organized under the 
 provisions of sections 469.001 to 469.047; or any port authority 
 organized under sections 469.048 to 469.089; or any hospital 
 district organized or reorganized prior to July 1, 1975, under 
 sections 447.31 to 447.37 or the successor of the district, nor 
 the Minneapolis community development agency.  

    Subd. 7.    Member.  "Member" means a person who accepts 
 employment as a "public employee" under subdivision 2, who is an 
 employee who works in one or more positions that require or 
 allow membership in the association under subdivision 2a or 2d, 
 for whom contributions have been withheld from salary and who is 
 not covered by the plan established in chapter 353D or excluded 
 under subdivision 2b.  A person who is a member remains a member 
 while performing services as a public employee and while on an 
 authorized leave of absence or an authorized temporary layoff. 

    Subd. 7a.    Former member.  "Former member" means a 
 member of the association who terminates public service under 
 subdivision 11a or membership under subdivision 11b. 

    Subd. 8.    Association.  "Association" means the 
 public employees retirement association. 

    Subd. 9.  Repealed, 1957 c 935 s 27 

    Subd. 10.    Salary.  (a) "Salary" means: 

    (1) periodic compensation of a public employee, before 
 deductions for deferred compensation, supplemental retirement 
 plans, or other voluntary salary reduction programs, and also 
 means "wages" and includes net income from fees; and 

    (2) for a public employee who has prior service covered by 
 a local police or firefighters relief association that has 
 consolidated with the public employees retirement association or 
 to which section 353.665 applies and who has elected coverage 
 either under the public employees police and fire fund benefit 
 plan under section 353A.08 following the consolidation or under 
 section 353.665, subdivision 4, "salary" means the rate of 
 salary upon which member contributions to the special fund of 
 the relief association were made prior to the effective date of 
 the consolidation as specified by law and by bylaw provisions 
 governing the relief association on the date of the initiation 
 of the consolidation procedure and the actual periodic 
 compensation of the public employee after the effective date of 
 consolidation. 

    (b) Salary does not mean: 

    (1) fees paid to district court reporters, unused annual 
 vacation or sick leave payments, in lump-sum or periodic 
 payments, severance payments, reimbursement of expenses, 
 lump-sum settlements not attached to a specific earnings period, 
 or workers' compensation payments; 

    (2) employer-paid amounts used by an employee toward the 
 cost of insurance coverage, employer-paid fringe benefits, 
 flexible spending accounts, cafeteria plans, health care expense 
 accounts, day care expenses, or any payments in lieu of any 
 employer-paid group insurance coverage, including the difference 
 between single and family rates that may be paid to a member 
 with single coverage and certain amounts determined by the 
 executive director to be ineligible; 

    (3) the amount equal to that which the employing 
 governmental subdivision would otherwise pay toward single or 
 family insurance coverage for a covered employee when, through a 
 contract or agreement with some but not all employees, the 
 employer: 

    (i) discontinues, or for new hires does not provide, 
 payment toward the cost of the employee's selected insurance 
 coverages under a group plan offered by the employer; 

    (ii) makes the employee solely responsible for all 
 contributions toward the cost of the employee's selected 
 insurance coverages under a group plan offered by the employer, 
 including any amount the employer makes toward other employees' 
 selected insurance coverages under a group plan offered by the 
 employer; and 

    (iii) provides increased salary rates for employees who do 
 not have any employer-paid group insurance coverages; and 

    (4) except as provided in section 353.86 or 353.87, 
 compensation of any kind paid to volunteer ambulance service 
 personnel or volunteer firefighters, as defined in subdivision 
 35 or 36.  

    Subd. 11.    Public service.  "Public service" means 
 service as an officer or employee of a governmental subdivision. 

    Subd. 11a.    Termination of public service.  (a) 
 "Termination of public service" occurs when a member resigns or 
 is dismissed from public service by the employing governmental 
 subdivision or when a position ends and the member who held the 
 position is not considered by the governmental subdivision to be 
 on a temporary layoff, and the employee does not, within 30 days 
 of the date the employment relationship ended, return to an 
 employment position in the same governmental subdivision. 

    (b) The termination of public service must be recorded in 
 the association records upon receipt of an appropriate notice 
 from the governmental subdivision. 

    Subd. 11b.    Termination of membership.  (a) 
 "Termination of membership" means the conclusion of membership 
 in the association and occurs: 

    (1) upon termination of public service under subdivision 
 11a; 

    (2) when a member does not return to work within 30 days of 
 the expiration of an authorized temporary layoff under 
 subdivision 12 or an authorized leave of absence under 
 subdivision 31 as evidenced by the appropriate record filed by 
 the governmental subdivision; or 

    (3) when a person files a written election to discontinue 
 employee deductions under section 353.27, subdivision 7, 
 paragraph (a), clause (1). 

    (b) The termination of membership must be reported to the 
 association by the governmental subdivision. 

    (c) If the employee subsequently returns to a position in 
 the same governmental subdivision, the employee shall not again 
 be required to earn a salary in excess of $425 per month to 
 qualify for membership, unless the employee has taken a refund 
 of accumulated employee deduction plus interest under section 
 353.34, subdivision 1. 

    Subd. 12.    Authorized temporary layoff.  "Authorized 
 temporary layoff," including seasonal leave of absence, means a 
 suspension of public service authorized by the employing 
 governmental subdivision for a period not exceeding three months 
 in any calendar year, as evidenced by appropriate record of the 
 employer and promptly transmitted to the association. 

    Subd. 12a.    Temporary position.  (1) "Temporary 
 position" means an employment position predetermined by the 
 employer at the time of hiring to be a period of six months or 
 less.  Temporary position also means an employment position 
 occupied by a person hired by the employer as a temporary 
 replacement who is employed for a predetermined period of six 
 months or less. 

    (2) "Temporary position" does not mean an employment 
 position for a specified term in which a person serves a 
 probationary period as a requirement for subsequent employment 
 on a permanent or unlimited basis. 

    Subd. 12b.    Seasonal position.  "Seasonal position" 
 means a position where the nature of the work or its duration 
 are related to a specific season or seasons of the year, 
 regardless of whether or not the employing agency anticipates 
 that the same employee will return to the position each season 
 in which it becomes available.  The entire period of employment 
 in a business year must be used to determine whether or not a 
 position may be excluded as seasonal when there is less than a 
 30-day break between one seasonal position and a subsequent 
 seasonal position for employment with the same governmental 
 employer.  Seasonal positions include, but are not limited to, 
 coaching athletic activities or employment to plow snow or to 
 maintain roads or parks, or to operate skating rinks, ski 
 lodges, golf courses, or swimming pools. 

    Subd. 13.  Repealed, 1963 c 641 s 38 

    Subd. 14.    Actuarial equivalent.  "Actuarial 
 equivalent" means the condition of one annuity or benefit having 
 an equal actuarial present value as another annuity or benefit, 
 determined as of a given date with each actuarial present value 
 based on the appropriate mortality table adopted by the board of 
 trustees based on the experience of the fund as recommended by 
 the actuary retained by the legislative commission on pensions 
 and retirement and using the applicable preretirement or 
 postretirement interest rate assumption specified in section 
 356.215, subdivision 8.  

    Subd. 15.    Dependent child.  For the purpose of 
 survivor benefit eligibility under sections 353.31, subdivision 
 1, and 353.657, subdivision 3, "dependent child" means a 
 biological or adopted child of a deceased member who is 
 unmarried, and under the age of 18, or age 18 to 23, so long as 
 the child submits evidence of full-time enrollment in an 
 accredited educational institution.  "Dependent child" also 
 includes a child of the member conceived during the member's 
 lifetime and born after the member's death.  It also means a 
 dependent child who is the subject of adoption proceedings filed 
 by a member, and who within two years after death of the member, 
 by judgment and decree duly entered, is adjudged to be the 
 adopted child of the deceased member; subject, however, to the 
 qualifying conditions of age and dependency under this 
 subdivision.  The dependency of the child dates from the decree 
 of adoption.  "Dependent child" also includes a child age 18 to 
 23 who had submitted evidence of full-time enrollment in an 
 accredited educational institution but was determined to be 
 medically unable to continue school on a full-time basis.  The 
 board of trustees shall adopt written procedures to make 
 determinations regarding eligibility based on a student being 
 medically unable to continue school, and may not continue a 
 benefit for medical reasons for a period greater than one year. 

    Subd. 15a.    Dependent child.  For the purpose of 
 survivor benefit eligibility under section 353.32, subdivision 
 1c, "dependent child" means any biological or adopted child of a 
 deceased member who has not reached the age of 20 and is 
 dependent for more than one-half of support upon the member.  It 
 also includes any child of the member conceived during the 
 member's lifetime and born after the member's death. 

    Subd. 16.    Allowable service; limits and computation.  
 (a) "Allowable service" means: 

    (1) service during years of actual membership in the course 
 of which employee contributions were made, periods covered by 
 payments in lieu of salary deductions under section 353.35; 

    (2) service in years during which the public employee was 
 not a member but for which the member later elected, while a 
 member, to obtain credit by making payments to the fund as 
 permitted by any law then in effect; 

    (3) a period of authorized leave of absence with pay from 
 which deductions for employee contributions are made, deposited, 
 and credited to the fund; 

    (4) a period of authorized personal, parental, or medical 
 leave of absence without pay, including a leave of absence 
 covered under the federal Family Medical Leave Act, that does 
 not exceed one year, and during or for which a member obtained 
 service credit for each month in the leave period by payments to 
 the fund made in place of salary deductions.  The payments must 
 be made in an amount or amounts based on the member's average 
 salary on which deductions were paid for the last six months of 
 public service, or for that portion of the last six months while 
 the member was in public service, to apply to the period in 
 either case that immediately precedes the commencement of the 
 leave of absence.  If the employee elects to pay the employee 
 contributions for the period of any authorized personal, 
 parental, or medical leave of absence without pay, or for any 
 portion of the leave, the employee shall also, as a condition to 
 the exercise of the election, pay to the fund an amount 
 equivalent to the required employer and the additional employer 
 contributions, if any, for the employee.  The payment must be 
 made within one year from the expiration of the leave of absence 
 or within 20 days after termination of public service under 
 subdivision 11a, whichever is earlier.  The employer, by 
 appropriate action of its governing body which is made a part of 
 its official records and which is adopted before the date of the 
 first payment of the employee contribution, may certify to the 
 association in writing its commitment to pay the employer and 
 additional employer contributions from the proceeds of a tax 
 levy made under section 353.28.  Payments under this paragraph 
 must include interest at an annual rate of 8.5 percent 
 compounded annually from the date of the termination of the 
 leave of absence to the date payment is made.  An employee shall 
 return to public service and render a minimum of three months of 
 allowable service in order to be eligible to pay employee and 
 employer contributions for a subsequent authorized leave of 
 absence without pay.  Upon payment, the employee must be granted 
 allowable service credit for the purchased period; 

    (5) a periodic, repetitive leave that is offered to all 
 employees of a governmental subdivision.  The leave program may 
 not exceed 208 hours per annual normal work cycle as certified 
 to the association by the employer.  A participating member 
 obtains service credit by making employee contributions in an 
 amount or amounts based on the member's average salary that 
 would have been paid if the leave had not been taken.  The 
 employer shall pay the employer and additional employer 
 contributions on behalf of the participating member.  The 
 employee and the employer are responsible to pay interest on 
 their respective shares at the rate of 8.5 percent a year, 
 compounded annually, from the end of the normal cycle until full 
 payment is made.  An employer shall also make the employer and 
 additional employer contributions, plus 8.5 percent interest, 
 compounded annually, on behalf of an employee who makes employee 
 contributions but terminates public service.  The employee 
 contributions must be made within one year after the end of the 
 annual normal working cycle or within 20 days after termination 
 of public service, whichever is sooner.  The association shall 
 prescribe the manner and forms to be used by a governmental 
 subdivision in administering a periodic, repetitive leave.  Upon 
 payment, the member must be granted allowable service credit for 
 the purchased period; 

    (6) an authorized temporary layoff under subdivision 12, 
 limited to three months allowable service per authorized 
 temporary layoff in one calendar year.  An employee who has 
 received the maximum service credit allowed for an authorized 
 temporary layoff must return to public service and must obtain a 
 minimum of three months of allowable service subsequent to the 
 layoff in order to receive allowable service for a subsequent 
 authorized temporary layoff; 

    (7) a period during which a member is on an authorized 
 leave of absence to enter military service in the armed forces 
 of the United States if the member returns to public service 
 upon discharge from military service under section 192.262 and 
 pays into the fund employee contributions based upon the 
 employee's salary at the date of return from military service.  
 Payment must be made within a period that is three times the 
 length of the military leave period, or within five years of the 
 date of discharge from the military service, whichever is less.  
 Payment may not be accepted following 20 days after termination 
 of public service under subdivision 11a.  The amount of these 
 contributions must be in accord with the contribution rates and 
 salary limitations, if any, in effect during the leave, plus 
 interest at an annual rate of 8.5 percent compounded annually 
 from the date of return to public service to the date payment is 
 made.  The corresponding employer contribution, and additional 
 employer contribution, if applicable, must be paid by the 
 governmental subdivision employing the member upon the person's 
 return to public service if the member makes the employee 
 contributions.  The governmental subdivision involved may 
 appropriate money for those payments.  A member may not receive 
 credit for a voluntary extension of military service at the 
 instance of the member beyond the initial period of enlistment, 
 induction, or call to active duty.  Upon payment, the employee 
 must be granted allowable service credit for the purchased 
 period; or 

    (8) a period of time during which a member who is a state 
 employee was on strike without pay, not to exceed a period of 
 one year, if the member makes a payment in lieu of salary 
 deductions or makes a prior service credit purchase payment, 
 whichever applies.  If the payment is made within 12 months, the 
 payment by the member must be an amount equal to the employee, 
 employer, and employer additional contribution rates set forth 
 in section 353.27, subdivisions 2, 3, and 3a, applied to the 
 employee's rate of salary in effect on the conclusion of the 
 strike for the period of the strike without pay, plus compound 
 interest at a monthly rate of 0.71 percent from the last day of 
 the strike until the date of payment.  If the payment by the 
 employee is not made within 12 months, the payment must be in an 
 amount equal to the payment amount determined under section 
 356.55 or 356.551, whichever applies. 

    (b) For calculating benefits under sections 353.30, 353.31, 
 353.32, and 353.33 for state officers and employees displaced by 
 the Community Corrections Act, chapter 401, and transferred into 
 county service under section 401.04, "allowable service" means 
 the combined years of allowable service as defined in paragraph 
 (a), clauses (1) to (6), and section 352.01, subdivision 11.  

    (c) For a public employee who has prior service covered by 
 a local police or firefighters relief association that has 
 consolidated with the public employees retirement association or 
 to which section 353.665 applies, and who has elected the type 
 of benefit coverage provided by the public employees police and 
 fire fund either under section 353A.08 following the 
 consolidation or under section 353.665, subdivision 4, 
 "applicable service" is a period of service credited by the 
 local police or firefighters relief association as of the 
 effective date of the consolidation based on law and on bylaw 
 provisions governing the relief association on the date of the 
 initiation of the consolidation procedure. 

    (d) No member may receive more than 12 months of allowable 
 service credit in a year either for vesting purposes or for 
 benefit calculation purposes. 

    (e) "Allowable service" also means a period purchased under 
 section 356.555. 

    Subd. 16a.    Uncredited military service credit purchase. 
  (a) A public employee who has at least three years of 
 allowable service with the public employees retirement 
 association or the public employees police and fire plan and who 
 performed service in the United States armed forces before 
 becoming a public employee, or who failed to obtain service 
 credit for a military leave of absence under subdivision 16, 
 paragraph (h), is entitled to purchase allowable service credit 
 for the initial period of enlistment, induction, or call to 
 active duty without any voluntary extension by making payment 
 under section 356.55 if the public employee is not entitled to 
 receive a current or deferred retirement annuity from a United 
 States armed forces pension plan and has not purchased service 
 credit from any other defined benefit public employee pension 
 plan for the same period of service. 

    (b) A public employee who desires to purchase service 
 credit under paragraph (a) must apply with the executive 
 director to make the purchase.  The application must include all 
 necessary documentation of the public employee's qualifications 
 to make the purchase, signed written permission to allow the 
 executive director to request and receive necessary verification 
 of applicable facts and eligibility requirements, and any other 
 relevant information that the executive director may require. 

    (c) Allowable service credit for the purchase period must 
 be granted by the public employees association or the public 
 employees police and fire plan, whichever applies, to the 
 purchasing public employee upon receipt of the purchase payment 
 amount.  Payment must be made before the effective date of 
 retirement of the public employee. 

    Subd. 17.    Approved actuary.  "Approved actuary" 
 means any actuary who is a fellow of the society of actuaries or 
 who has at least 15 years of service to major public employee 
 funds or any firm retaining such an actuary on its staff. 

    Subd. 18.    Year of allowable service.  "Year of 
 allowable service" means any 12 calendar months not necessarily 
 consecutive in which a public employee received compensation 
 from the governmental subdivision or was eligible to credit for 
 service.  It also means 12 months credit each year for employees 
 who are paid on a yearly basis and who may or may not receive 
 compensation in every calendar month in the year. 

    Subd. 19.    Total and permanent disability.  "Total and 
 permanent disability" means the inability to engage in any 
 substantial gainful activity by reason of any medically 
 determinable physical or mental impairment which can be expected 
 to be of long-continued and indefinite duration.  Long-continued 
 and indefinite duration means that the disability has been or is 
 expected to be for a period of at least one year. 

    Subd. 20.    Surviving spouse.  "Surviving spouse" means 
 the spouse of a deceased member or disabilitant who was legally 
 married to the member at the time of death. 

    Subd. 21.  Repealed, 1971 c 106 s 40 

    Subd. 22.  Repealed, 1971 c 106 s 40 

    Subd. 23.    Retirement annuity.  "Retirement annuity" 
 means the amount paid or payable by the fund to a former member 
 after retirement. 

    Subd. 24.    Optional annuity.  "Optional annuity" 
 means the allowance paid or payable by the fund to the 
 designated optional annuity beneficiary of a member or former 
 member, pursuant to an optional annuity form selected at or 
 before retirement, or to the spouse of a deceased member under 
 section 353.32, subdivision 1a. 

    Subd. 25.  Repealed, 1973 c 753 s 85 

    Subd. 26.  Repealed, 1971 c 106 s 40 

    Subd. 27.    Benefit.  "Benefit" means a monthly 
 survivor benefit paid or payable by the fund to a surviving 
 spouse or a dependent child and also includes a monthly 
 disability benefit paid or payable by the fund to a member who 
 is totally and permanently disabled. 

    Subd. 28.    Retirement.  (a) "Retirement" means the 
 commencement of payment of an annuity based on a date designated 
 by the board of trustees.  This date determines the rights under 
 this chapter which occur either before or after retirement.  A 
 right to retirement is subject to termination of public service 
 under subdivision 11a.  A right to retirement requires a 
 complete and continuous separation for 30 days from employment 
 as a public employee and from the provision of paid services to 
 that employer. 

    (b) An individual who separates from employment as a public 
 employee and who, within 30 days of separation, returns to 
 provide service to a governmental subdivision as an independent 
 contractor or as an employee of an independent contractor, has 
 not satisfied separation requirements under paragraph (a). 

    (c) A former member of the basic or police and fire fund 
 who becomes a coordinated member upon returning to eligible, 
 nontemporary public service, terminates employment before 
 obtaining six months' allowable service under subdivision 16, 
 paragraph (a), in the coordinated fund, and is eligible to 
 receive an annuity the first day of the month after the most 
 recent termination date shall not accrue a right to a retirement 
 annuity under the coordinated fund.  An annuity otherwise 
 payable to the former member must be based on the laws in effect 
 on the date of termination of the most recent service under the 
 basic or police and fire fund and shall be retroactive to the 
 first day of the month following that termination date or one 
 year preceding the filing of an application for retirement 
 annuity as provided by section 353.29, subdivision 7, whichever 
 is later.  The annuity payment must be suspended under the 
 provisions of section 353.37, if earned compensation for the 
 reemployment equals or exceeds the amounts indicated under that 
 section.  The association will refund the employee deductions 
 made to the coordinated fund, with interest under section 
 353.34, subdivision 2, return the accompanying employer 
 contributions, and remove the allowable service credits covering 
 the deductions refunded. 

    (d) Notwithstanding the 30-day separation requirement under 
 paragraph (a), a member of the defined benefit plan under this 
 chapter, who also participates in the public employees defined 
 contribution plan under chapter 353D for other public service, 
 may be paid, if eligible, a retirement annuity from the defined 
 benefit plan while participating in the defined contribution 
 plan. 

    Subd. 29.    Designated beneficiary.  "Designated 
 beneficiary" means the person or organization designated by a 
 member, former member, disabilitant, or retired member in 
 writing, signed and filed with the association before the death 
 of the member, former member, disabilitant, or retired member, 
 to receive a refund of the balance of the member's accumulated 
 deductions after death. 

    Subd. 30.    Designated optional annuity beneficiary.  
 "Designated optional annuity beneficiary" means the person 
 designated by a former member to receive a joint and survivor 
 annuity or a modified joint and survivor annuity. 

    Subd. 31.    Authorized leave of absence.  "Authorized 
 leave of absence" means any period during which a member is 
 authorized by an employer to refrain from active employment, 
 with or without pay, evidenced by appropriate record of the 
 employer and promptly transmitted to the association. 

    Subd. 32.    Coordinated member.  "Coordinated member" 
 means any public employee, including any public hospital 
 employee, covered by any agreement or modification made between 
 the state and the Secretary of Health, Education and Welfare, 
 making the provisions of the federal Old Age, Survivors and 
 Disability Insurance Act applicable to the member if membership 
 eligibility criteria are met under this chapter.  A coordinated 
 member also is a former basic member who has a complete and 
 continuous separation for at least 30 days from employment as a 
 public employee meeting the requirements specified in 
 subdivision 28, paragraphs (a) and (b), and who reenters public 
 service as a public employee and meets the membership 
 eligibility criteria under this chapter. 

    Subd. 33.    Basic member.  "Basic member" means any 
 public employee, including any public hospital employee, not 
 covered by any agreement or modification made between the state 
 and the Secretary of Health, Education and Welfare. 

    Subd. 34. Repealed, 1982 c 404 s 10 

    Subd. 35.    Volunteer ambulance service personnel.  
 "Volunteer ambulance service personnel," for purposes of this 
 chapter, are 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. 

    Subd. 36.    Volunteer firefighter.  For purposes of 
 this chapter, a person is considered a "volunteer firefighter" 
 for all service for which the person receives credit in an 
 association or fund operating under chapter 424A. 

    Subd. 37.    Normal retirement age.  "Normal retirement 
 age" means age 65 for a person who first became a public 
 employee or a member of a pension fund listed in section 356.30, 
 subdivision 3, before July 1, 1989.  For a person who first 
 becomes a public employee after June 30, 1989, "normal 
 retirement age" means the higher of age 65 or "retirement age," 
 as defined in United States Code, title 42, section 416(l), as 
 amended, but not to exceed age 66. 

    Subd. 38.    Business year.  "Business year" means the 
 first day of the first full pay period through the last day of 
 the last full pay period of the 12-month fiscal year applicable 
 to the respective governmental subdivision. 

    Subd. 39. Repealed, 2002 c 392 art 3 s 9 

    Subd. 40.    Reduced salary during period of workers' 
 compensation.  (a) A member who is receiving temporary 
 workers' compensation payments related to the member's service 
 to the public employer and who either is receiving a reduced 
 salary from the employer during that period or is receiving no 
 salary from the employer during that period is entitled to 
 receive allowable service and salary credit for the period of 
 time that the member is receiving the workers' compensation 
 payments upon making the payments specified in this subdivision. 

    (b) The differential salary amount is the difference 
 between the average rate of salary received by the member, if 
 any, during the period of time that the member is collecting 
 temporary workers' compensation payments and the average rate of 
 salary of the member on which contributions to the applicable 
 plan were made during the period of the last six months of 
 covered employment occurring immediately before beginning to 
 collect the temporary workers' compensation payments, applied to 
 the member's normal employment period, measured in hours or 
 otherwise, as applicable. 

    (c) To receive eligible service credit, the member shall 
 pay an amount equal to the applicable employee contribution rate 
 under section 353.27, subdivision 2; 353.65, subdivision 2; or 
 353E.03, subdivision 1, as applicable, multiplied by the 
 differential salary amount; plus an employer equivalent payment 
 equal to the applicable employer contribution rate in section 
 353.27, subdivision 3; 353.65, subdivision 3; or 353E.03, 
 subdivision 2, as applicable, multiplied by the differential 
 salary amount; plus, if applicable, an equivalent employer 
 additional amount equal to the additional employer contribution 
 rate in section 353.27, subdivision 3a, multiplied by the 
 differential salary amount. 

    (d) The employer may, by appropriate action of its 
 governing body and documented in its official records, pay the 
 employer equivalent contributions and, as applicable, the 
 equivalent employer additional contributions on behalf of the 
 member. 

    (e) Payment under this subdivision must include interest on 
 the contribution amount or amounts, whichever applies, at an 8.5 
 percent annual rate, prorated for applicable months from the 
 date on which the temporary workers' compensation payments 
 terminate to the date on which the payment or payments are 
 received by the executive director.  Payment under this 
 subdivision must be completed within one year after the 
 termination of the temporary workers' compensation payments to 
 the member, or within 20 days after the termination of public 
 service by the employee under subdivision 11a, whichever is 
 earlier. 

    HIST: (254-23) 1931 c 307 s 1; 1933 c 374 s 1; 1937 c 466 s 1; 
 1941 c 285 s 1; 1945 c 78 s 1; 1947 c 18 s 1; 1949 c 84 s 1; 
 1951 c 22 s 1-8; 1953 c 78 s 1; 1955 c 815 s 11; 1957 c 815 s 1; 
 1957 c 935 s 1-5; 1959 c 650 s 1-7,39,43,58; 1961 c 482 s 1; 
 1961 c 595 s 1; 1961 c 746 s 1; 1963 c 440 s 1; 1963 c 641 s 
 3-12; 1965 c 104 s 1; 1965 c 880 s 1,2; Ex1967 c 26 s 1; Ex1967 
 c 37 s 1; 1969 c 940 s 1,2; 1971 c 106 s 1-8; 1971 c 503 s 1,2; 
 1973 c 123 art 5 s 7; 1973 c 753 s 3-18; 1974 c 229 s 1-8; 1975 
 c 102 s 1-3; 1975 c 359 s 23; 1976 c 329 s 12-15; 1977 c 347 s 
 52,53; 1977 c 429 s 19-22,63; 1978 c 471 s 1; 1978 c 720 s 6; 
 1978 c 796 s 23-26; 1979 c 216 s 1-4,21; 1979 c 303 art 6 s 5; 
 1980 c 609 art 5 s 20; 1981 c 68 s 16-18; 1981 c 180 s 1; 1981 c 
 224 s 73-75; 1981 c 298 s 11; 1982 c 404 s 1-4; 1982 c 424 s 
 64,115,125; 1983 c 286 s 6; 1985 c 261 s 3; 1Sp1985 c 7 s 12; 
 1986 c 399 art 2 s 9; 1986 c 400 s 9; 1986 c 444; 1986 c 458 s 
 11; 1Sp1986 c 3 art 2 s 41; 1987 c 49 s 9; 1987 c 258 s 12; 1987 
 c 259 s 25; 1987 c 284 art 5 s 1,2; 1987 c 291 s 215; 1987 c 296 
 s 1-3; 1987 c 372 art 1 s 5; 1988 c 709 art 2 s 1; art 5 s 1-7; 
 1989 c 209 art 2 s 36; 1989 c 246 s 2; 1989 c 319 art 3 s 1-6; 
 art 5 s 1; art 13 s 29; 1989 c 335 art 3 s 5; 1990 c 556 s 7; 
 1990 c 570 art 8 s 1; art 11 s 1-3; art 12 s 19; 1991 c 269 art 
 2 s 5; 1991 c 341 s 1-6; 1992 c 432 art 2 s 2-5; 1992 c 598 art 
 2 s 1; 1993 c 307 art 4 s 1-15; 1993 c 336 art 6 s 5,6; 1994 c 
 528 art 2 s 1-4; 1994 c 572 s 5; 1997 c 233 art 1 s 37; 1997 c 
 241 art 2 s 1; 1998 c 254 art 1 s 87; 1999 c 222 art 4 s 4-6; 
 2000 c 260 s 93; 2000 c 461 art 3 s 7-12; art 4 s 3; art 7 s 1; 
 1Sp2001 c 10 art 6 s 3; art 10 s 2,3; art 11 s 1-12; 2002 c 392 
 art 2 s 2; art 3 s 1-5; art 11 s 52 

*   NOTE:  The amendment to subdivision 16 by Laws 2002, 
*chapter 392, article 2, section 2, is effective retroactive to 
*July 1, 2001.  The authority to obtain credit for allowable 
*service under subdivision 16, paragraph (a), clause (8), expires 
*July 1, 2002.  Laws 2002, chapter 392, article 2, section 4. 

*   NOTE:  The amendment to subdivision 16 by Laws 2001, First 
*Special Session chapter 10, article 6, section 3, expires May 
*16, 2003.  Laws 2001, First Special Session chapter 10, article 
*6, section 21. 

*   NOTE:  Subdivision 16a, as added by Laws 2000, chapter 461, 
*article 4, section 3, is repealed effective May 16, 2003.  Laws 
*2000, chapter 461, article 4, section 4, paragraph (b). 

*   NOTE:  Subdivision 2a was also amended by Laws 2001, First 
*Special Session chapter 10, article 10, section 1, to read as 
*follows: 

*   "Subd. 2a.    Included employees.  Public employees 
*whose salary from one governmental subdivision exceeds $425 in 
*any month shall participate as members of the association.  If 
*the salary of an employee is less than $425 in a subsequent 
*month, the employee retains membership eligibility.  The 
*following persons are considered public employees: 

*   (1) employees whose annual salary from one governmental 
*subdivision exceeds a stipulation prepared in advance, in 
*writing, to be not more than $5,100 per calendar year or per 
*school year for school employees for employment expected to be 
*of a full year's duration or more than the prorated portion of 
*$5,100 per employment period expected to be of less than a full 
*year's duration.  If compensation from one governmental 
*subdivision to an employee under this clause exceeds $5,100 per 
*calendar year or school year after being stipulated in advance 
*not to exceed that amount, the stipulation is no longer valid 
*and contributions must be made on behalf of the employee under 
*section 353.27, subdivision 12, from the month in which the 
*employee's salary first exceeded $425; 

*   (2) employees whose total salary from concurrent 
*nontemporary positions in one governmental subdivision exceeds 
*$425 in any month; 

*   (3) elected officers for service to which they were elected 
*by the public-at-large, or persons appointed to fill a vacancy 
*in an elective office, who elect to participate by filing an 
*application for membership, but not for service on a joint or 
*regional board that is a governmental subdivision under 
*subdivision 6, paragraph (a), unless the salary earned for that 
*service exceeds $425 in any month.  The option to become a 
*member, once exercised, may not be withdrawn during the 
*incumbency of the person in office; 

*   (4) members who are appointed by the governor to be a state 
*department head and elect not to be covered by the Minnesota 
*state retirement system under section 352.021; 

*   (5) employees of elected officers; 

*   (6) persons who elect to remain members under section 
*480.181, subdivision 2; 

*   (7) employees of a school district who receive separate 
*salaries for driving their own buses; 

*   (8) employees of the Minnesota association of townships 
*when the board of the association, at its option, certifies to 
*the executive director that its employees are to be included for 
*purposes of retirement coverage, in which case coverage of all 
*employees of the association is permanent; 

*   (9) employees of a county historical society who are county 
*employees; 

*   (10) employees of a county historical society located in 
*the county whom the county, at its option, certifies to the 
*executive director to be county employees for purposes of 
*retirement coverage under this chapter, which status must be 
*accorded to all similarly situated county historical society 
*employees and, once established, must continue as long as a 
*person is an employee of the county historical society and is 
*not excluded under subdivision 2b; 

*   (11) employees who became members before July 1, 1988, 
*based on the total salary of positions held in more than one 
*governmental subdivision; and 

*   (12) full-time employees of the Dakota county agricultural 
*society."