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Minnesota Legislature

Office of the Revisor of Statutes

CHAPTER 353. PUBLIC EMPLOYEES RETIREMENT ASSOCIATION

Table of Sections
SectionHeadnote
353.01DEFINITIONS.
353.011Repealed, 1996 c 310 s 1
353.015Repealed, 1973 c 753 s 85
353.016Repealed, 1977 c 429 s 65
353.0161353.0161 AUTHORIZED LEAVE OF ABSENCE SERVICE CREDIT PURCHASE PROCEDURE.
353.017EMPLOYEES OF LABOR ORGANIZATIONS.
353.018Repealed, 1977 c 429 s 65
353.019Repealed, 1977 c 429 s 65
353.02Repealed, 1957 c 935 s 27
353.022Repealed, 1981 c 68 s 46
353.023Repealed, 1982 c 404 s 10
353.024Repealed, 2000 c 461 art 3 s 47
353.025RANGE ASSOCIATION OF MUNICIPALITIES AND SCHOOLS.
353.026COVERAGE FOR CERTAIN MUNICIPAL AND SCHOOL DISTRICT EMPLOYEES.
353.027Repealed, 2006 c 260 art 5 s 54
353.028CITY MANAGERS; ELECTION; DEFERRED COMPENSATION.
353.03BOARD OF TRUSTEES.
353.031353.031 DISABILITY DETERMINATION PROCEDURES.
353.04Repealed, 1957 c 935 s 27
353.05CUSTODIAN OF FUNDS.
353.06STATE BOARD OF INVESTMENT TO INVEST FUNDS.
353.07Repealed, 1973 c 753 s 85
353.08LEGAL ADVISER, ATTORNEY GENERAL; VENUE.
353.09Repealed, 1957 c 935 s 27
353.10Repealed, 1957 c 935 s 27
353.11Repealed, 1957 c 935 s 27
353.12Repealed, 1957 c 935 s 27
353.13Repealed, 1973 c 753 s 85
353.14BENEFITS FROM OTHER FUNDS.
353.15NONASSIGNABILITY AND EXEMPTION OF ANNUITIES AND BENEFITS FROM JUDICIAL PROCESS.
353.16AUDIT OF BOOKS AND ACCOUNTS; INSURANCE LAWS NOT APPLICABLE.
353.17Repealed, 1971 c 106 s 40
353.18RULES.
353.19PENALTIES FOR FALSE INFORMATION.
353.20Repealed, 1955 c 815 s 12
353.21Repealed, 1957 c 935 s 27
353.26
353.27PUBLIC EMPLOYEES RETIREMENT FUND.
353.271PARTICIPATION IN MINNESOTA POSTRETIREMENT INVESTMENT FUND.
353.272Repealed, 1981 c 180 s 18
353.28FINANCING OF EMPLOYER CONTRIBUTIONS.
353.29RETIREMENT ANNUITY UPON TERMINATION OF MEMBERSHIP.
353.30ANNUITIES UPON RETIREMENT.
353.31SURVIVOR BENEFITS.
353.32REFUNDS AFTER DEATH OF MEMBER OR FORMER MEMBER.
353.33TOTAL AND PERMANENT DISABILITY BENEFITS.
353.335353.335 DISABILITANT EARNINGS REPORTS.
353.34RIGHTS UPON TERMINATION OF MEMBERSHIP.
353.35CONSEQUENCES OF REFUND; REPAYMENT, RIGHTS RESTORED.
353.36
353.37REEMPLOYMENT OF ANNUITANT.
353.38Repealed, 1984 c 564 s 51
353.39Repealed, 1973 c 753 s 85
353.40Repealed, 1974 c 229 s 25
353.41Repealed, 1959 c 650 s 57
353.42Repealed, 1963 c 641 s 38
353.43Repealed, 1959 c 650 s 57
353.44
353.45Repealed, 1973 c 753 s 85
353.46SAVINGS CLAUSES.
353.51Repealed, 1973 c 753 s 85
353.52Repealed, 1973 c 753 s 85
353.53Repealed, 1973 c 753 s 85
353.54Repealed, 1973 c 753 s 85
353.55Repealed, 1973 c 753 s 85
353.56Repealed, 1973 c 753 s 85
353.57Repealed, 1973 c 753 s 85
353.58Repealed, 1973 c 753 s 85
353.59Repealed, 1973 c 753 s 85
353.591Repealed, 1973 c 753 s 85
353.60Repealed, 1973 c 753 s 85
353.61Repealed, 1973 c 753 s 85
353.62Repealed, 1971 c 106 s 40
353.63POLICY.
353.64MEMBERSHIP; QUALIFICATIONS; POLICE OFFICER, FIREFIGHTER.
353.65CONTRIBUTIONS.
353.651RETIREMENT ANNUITY UPON SEPARATION FROM PUBLIC SERVICE.
353.652SOCIAL SECURITY BENEFIT OFFSET IN CERTAIN INSTANCES.
353.654Repealed, 1973 c 753 s 85
353.655Repealed, 1973 c 753 s 85
353.656DISABILITY BENEFITS.
353.657SURVIVOR BENEFITS.
353.659LOCAL RELIEF ASSOCIATION CONSOLIDATION ACCOUNT BENEFITS.
353.66Repealed, 1973 c 753 s 85
353.661Repealed, 1989 c 319 art 3 s 26
353.662Repealed, 1989 c 319 art 3 s 26
353.663Repealed, 1Sp2005 c 8 art 10 s 81
353.665MERGER OF CERTAIN CONSOLIDATION ACCOUNTS INTO PERA-P&F.
353.666PAST SERVICE CREDIT FOR CERTAIN MEMBERS EXTENDED COVERAGE.
353.67APPLICATION FOR ANNUITY.
353.68SCOPE AND APPLICATION.
353.69Repealed, 2007 c 134 art 2 s 50
353.70Repealed, 1963 c 641 s 38
353.71COVERAGE BY MORE THAN ONE RETIREMENT SYSTEM; DEFERRED ANNUITY; AUGMENTATION.
353.74Repealed, 1Sp2005 c 8 art 10 s 81
353.75Repealed, 1Sp2005 c 8 art 10 s 81
353.76Special
353.77Special
353.78Special
353.79Special
353.80Special
353.81Special
353.82Special
353.83ADDITIONAL PAYMENTS TO CERTAIN ANNUITANTS.
353.84INCREASE IN BENEFITS.
353.85OPTIONAL BENEFITS TO SURVIVORS OF MEMBERS WHO DIED AFTER JUNE 15, 1973.
353.86VOLUNTEER AMBULANCE SERVICE PERSONNEL; PARTICIPATION; ELECTION; LIMITATION; AND COMPENSATION.
353.87VOLUNTEER FIREFIGHTERS; PARTICIPATION; LIMITATION; AND REFUND.
353.88PENALTY FOR MEMBERSHIP MISCERTIFICATIONS AND CERTIFICATION FAILURES.
353.95353.95 ACCOUNT FOR DULUTH POSTEMPLOYMENT BENEFITS.
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 also includes full-time employees of the Dakota
County Agricultural Society. 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 employment in
one or more positions within 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 for
the duration of the person's employment in that position or incumbency in elected office. Except
as provided in subdivision 28, the person shall participate as a member until the employee or
elected official terminates public employment under subdivision 11a or terminates membership
under subdivision 11b.
    (c) Public employees under paragraph (a) include physicians under section 353D.01,
subdivision 2, who do not elect public employees defined contribution plan coverage under
section 353D.02, subdivision 2.
    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
commences on or after July 1, 2002, for the service to be rendered in that elective position;
    (2) election officers or election judges;
    (3) patient and inmate personnel who perform services for a governmental subdivision;
    (4) except as otherwise specified in subdivision 12a, employees who are hired for a temporary
position as defined under subdivision 12a, and employees who resign from a nontemporary
position and accept a temporary position within 30 days in the same governmental subdivision;
    (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 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 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 plan or 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 or Hennepin Healthcare System, Inc., 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 must 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.
    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;
(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; and
(5) employees of the Port Authority of the city of St. Paul on January 1, 2003, who were at
least age 45 on that date, and who elected to participate by filing a written election for membership.
(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 that association, at its option,
certifies to the executive director that its employees who meet the conditions set forth in
subdivision 2a are to be included for purposes of retirement coverage, in which case the status of
the association as a participating employer is permanent;
(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 who meet
the conditions set forth in subdivision 2a are to be considered 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; and
(3) Hennepin Healthcare System, Inc., a public corporation, with respect to employees
other than paramedics, emergency medical technicians, and protection officers, if the corporate
board establishes alternative retirement plans for certain classes of employees of the corporation
and certifies to the association the applicable employees to be excluded from future retirement
coverage.
(c) For employees who are covered by paragraph (a), clause (1), (2), or (3), or covered by
paragraph (b), clause (1) or (2), 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. For employees specified in paragraph
(b), clause (3), membership continues until the exclusion option is exercised for the designated
class of employee. The option to become a member, once exercised under this subdivision, may
not be withdrawn until the 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, unit or instrumentality of state or local
government, or any public body established under state or local authority that has a governmental
purpose, is under public control, is responsible for the employment and payment of the salaries
of employees of the entity, and receives a major portion of its revenues from taxation, fees,
assessments or from other public sources.
    (b) Governmental subdivision also means the Public Employees Retirement Association,
the League of Minnesota Cities, the Association of Metropolitan Municipalities, charter schools
formed under section 124D.10, service cooperatives exercising retirement plan participation under
section 123A.21, subdivision 5, joint powers boards organized under section 471.59, subdivision
11
, paragraph (a), family service collaboratives and children's mental health collaboratives
organized under section 471.59, subdivision 11, paragraph (b) or (c), provided that the entities
creating the collaboratives are governmental units that otherwise qualify for retirement plan
membership, public hospitals owned or operated by, or an integral part of, a governmental
subdivision or governmental subdivisions, the Association of Minnesota Counties, the Minnesota
Inter-county Association, the Minnesota Municipal Utilities Association, the Metropolitan
Airports Commission, the University of Minnesota with respect to police officers covered by the
public employees police and fire retirement plan, 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 Port Authority of the city of St. Paul, the
Spring Lake Park Fire Department, incorporated, the Lake Johanna Volunteer Fire Department,
incorporated, the Red Wing Environmental Learning Center, the Dakota County Agricultural
Society, and Hennepin Healthcare System, Inc.
    (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 other than the Port Authority of the city of St. Paul;
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; or the board of a family service collaborative or children's
mental health collaborative organized under sections 124D.23, 245.491 to 245.495, or 471.59, if
that board is not controlled by representatives of governmental units.
    (d) A nonprofit corporation governed by chapter 317A or organized under Internal Revenue
Code, section 501(c)(3), which is not covered by paragraph (a) or (b), is not a governmental
subdivision unless the entity has obtained a written advisory opinion from the United States
Department of Labor or a ruling from the Internal Revenue Service declaring the entity to be an
instrumentality of the state so as to provide that any future contributions by the entity on behalf of
its employees are contributions to a governmental plan within the meaning of Internal Revenue
Code, section 414(d).
    (e) A public body created by state or local authority may request membership on behalf of its
employees by providing sufficient evidence that it meets the requirements in paragraph (a).
    (f) An entity determined to be a governmental subdivision is subject to the reporting
requirements of this chapter upon receipt of a written notice of eligibility from the association.
    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) Subject to the limitations of section 356.611, "salary" means:
(1) the 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;
(2) for a public employee who is covered by a supplemental retirement plan under section
356.24, subdivision 1, clause (8), (9), or (10), which require all plan contributions be made by the
employer, the contribution to the applicable supplemental retirement plan when the contribution
is from mandatory withholdings from employees' wages; and
(3) 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, 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) the 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;
(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; and
(5) the amount of compensation that exceeds the limitation provided in section 356.611.
(c) Amounts provided to an employee by the employer through a grievance proceeding or a
legal settlement are salary only if the settlement is reviewed by the executive director and the
amounts are determined by the executive director to be consistent with paragraph (a) and prior
determinations.
    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 (1)
when a member resigns or is dismissed from public service by the employing governmental
subdivision 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; or (2) when the
employer-employee relationship is severed due to the expiration of a layoff under subdivision
12 or 12c.
(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 for a person who has not terminated public service
under subdivision 11a and occurs:
(1) when a person files a written election with the association to discontinue employee
deductions under section 353.27, subdivision 7, paragraph (a), clause (1);
(2) when a city manager files a written election with the association to discontinue employee
deductions under section 353.028, subdivision 2; or
(3) when a member transfers to a temporary position and becomes excluded from
membership under subdivision 2b, clause (4).
(b) The termination of membership under clause (3) must be reported to the association
by the governmental subdivision.
    Subd. 12. Authorized temporary or seasonal layoff. "Authorized temporary or seasonal
layoff," including seasonal leave of absence, means a suspension of public service for a limited
period during a year that is authorized by the employing governmental subdivision for a member
who is expected at the start of the period to return to the same position at the end of the layoff
period and for whom there has been no termination of public service under subdivision 11a.
    Subd. 12a. Temporary position. (a) "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.
(b) "Temporary position" does not mean an employment position for a specified or
unspecified term in which a person serves a probationary period as a requirement for subsequent
employment on a permanent or unlimited basis.
(c) If employment in a temporary position extends beyond six consecutive months, the head
of the department shall report the employee for membership if salary in any month exceeds
the salary threshold specified in subdivision 2a. The membership eligibility of an employee
who resigns or is dismissed from a temporary position and accepts another temporary position
in the same governmental subdivision within 30 days must be determined on the total length of
employment rather than on each separate position.
    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 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. 12c. Indefinite layoff. "Indefinite layoff" occurs when a member is placed on a layoff
that is not a temporary or seasonal layoff under subdivision 12, for which no date has been
specified by the employing governmental subdivision for the employee's return to work, and there
has been no termination of public service under subdivision 11a.
    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 under section 356.214, and approved under section 356.215, subdivision 18, 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 for which a member obtained service credit for each month in the leave
period by payment under section 353.0161 to the fund made in place of salary deductions. An
employee must return to public service and render a minimum of three months of allowable
service in order to be eligible to make payment under section 353.0161 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 executive director 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 or seasonal layoff under subdivision 12, limited to three months
allowable service per authorized temporary or seasonal layoff in one calendar year. An employee
who has received the maximum service credit allowed for an authorized temporary or seasonal
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 or seasonal layoff; or
    (7) a period during which a member is absent from employment by a governmental
subdivision by reason of service in the uniformed services, as defined in United States Code, title
38, section 4303(13), if the member returns to public service upon discharge from service in the
uniformed service within the time frames required under United States Code, title 38, section
4312(e), provided that the member did not separate from uniformed service with a dishonorable
or bad conduct discharge or under other than honorable conditions. The service is credited if the
member pays into the fund equivalent employee contributions based upon the contribution rate or
rates in effect at the time that the uniformed service was performed multiplied by the full and
fractional years being purchased and applied to the annual salary rate. The annual salary rate is
the average annual salary during the purchase period that the member would have received if the
member had continued to be employed in covered employment rather than to provide uniformed
service, or, if the determination of that rate is not reasonably certain, the annual salary rate is
the member's average salary rate during the 12-month period of covered employment rendered
immediately preceding the period of the uniformed service. Payment of the member equivalent
contributions must be made during a period that begins with the date on which the individual
returns to public employment and 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. If the
determined payment period is less than one year, the contributions required under this clause to
receive service credit may be made within one year of the discharge date. Payment may not be
accepted following 20 days after termination of public service under subdivision 11a. If the
member equivalent contributions provided for in this clause are not paid in full, the member's
allowable service credit must be prorated by multiplying the full and fractional number of years
of uniformed service eligible for purchase by the ratio obtained by dividing the total member
contributions received by the total member contributions otherwise required under this clause.
The equivalent employer contribution, and, if applicable, the equivalent additional employer
contribution must be paid by the governmental subdivision employing the member if the member
makes the equivalent employee contributions. The employer payments must be made from funds
available to the employing unit, using the employer and additional employer contribution rate or
rates in effect at the time that the uniformed service was performed, applied to the same annual
salary rate or rates used to compute the equivalent member contribution. The governmental
subdivision involved may appropriate money for those payments. The amount of service credit
obtainable under this section may not exceed five years unless a longer purchase period is required
under United States Code, title 38, section 4312. The employing unit shall pay interest on all
equivalent member and employer contribution amounts payable under this clause. Interest must
be computed at a rate of 8.5 percent compounded annually from the end of each fiscal year of
the leave or the break in service to the end of the month in which the payment is received. Upon
payment, the employee must be granted allowable service credit for the purchased period.
    (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) MS 2002 [Expired]
    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 356.551 if the public employee has not purchased
service credit from any other Minnesota 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. 17a. Average salary. (a) "Average salary," for purposes of calculating a retirement
annuity under section 353.29, subdivision 3, means an amount equivalent to the average of
the highest salary of the member, police officer, or firefighter, whichever applies, upon which
employee contributions were paid for any five successive years of allowable service, based on
dates of salary periods as listed on salary deduction reports. Average salary must be based upon
all allowable service if this service is less than five years.
(b) "Average salary" may not include any reduced salary paid during a period in which the
employee is entitled to benefit payments from workers' compensation for temporary disability,
unless the average salary is higher, including this period.
    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 the 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 the separation
requirements under paragraph (a).
    (c) Notwithstanding the 30-day separation requirement under paragraph (a), a member
of a 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. A retirement annuity is also payable from a defined benefit plan under this chapter to an
eligible member who terminates public service and who, within 30 days of separation, takes office
as an elected official of a governmental subdivision.
    (d) Elected officials included in association membership under subdivisions 2a and 2d meet
the 30-day separation requirement under this section by resigning from office before filing for
a subsequent term in the same office and by remaining completely and continuously separated
from that office for 30 days prior to the date of the election.
    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 a public employee,
including a public hospital employee, who is covered by an agreement or modification made
between the state and the Secretary of Health and Human Services, making the provisions
of the federal Old Age, Survivors and Disability Insurance Act applicable to the member if
the 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 a public employee, including a public
hospital employee, who is not covered by any agreement or modification made between the state
and the Secretary of Health and Human Services.
    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. (a) "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
, clause (7), 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.
    (b) "Normal retirement age" means age 55 for a person who is a member of a pension fund
listed in section 356.30, subdivision 3, clauses (8) and (9).
    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.
    Subd. 41. Duty disability. "Duty disability," physical or psychological, means a condition
that is expected to prevent a member, for a period of not less than 12 months, from performing the
normal duties of the position held by a person who is a member of the public employees police
and fire plan, and that is the direct result of an injury incurred during, or a disease arising out of,
the performance of normal duties or the actual performance of less frequent duties, either of which
are specific to protecting the property and personal safety of others and that present inherent
dangers that are specific to the positions covered by the public employees police and fire plan.
    Subd. 42. Less frequent duties. "Less frequent duties" means tasks which are designated in
the applicant's job description as either required from time to time or as assigned, but which are
not carried out as part of the normal routine of the applicant's job.
    Subd. 43. Line of duty death. "Line of duty death" means a death that occurs while
performing or as a direct result of performing normal or less frequent duties which are specific to
protecting the property and personal safety of others and that present inherent dangers that are
specific to the positions covered by the public employees police and fire plan.
    Subd. 44. Normal duties. "Normal duties" means specific tasks which are designated in the
applicant's job description and which the applicant performs on a day-to-day basis, but do not
include less frequent duties which may be requested to be done by the employer from time to time.
    Subd. 45. Not line of duty death. For purposes of survivor benefits under the public
employees police and fire plan, a "not line of duty death" is any death not specified under
subdivision 43.
    Subd. 46. Regular disability. "Regular disability," physical or psychological, means a
condition that is expected to prevent a member, for a period of not less than 12 months, from
performing the normal duties of the position held by a person who is a member of the public
employees police and fire plan, and which results from a disease or an injury that arises from
any activities while not at work, or while at work and performing those normal or less frequent
duties that do not present inherent dangers that are specific to the occupations covered by the
public employees police and fire plan.
History: (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 3,21; art 10 s 1-3; art 11 s 1-12; 2002 c 392 art 2 s 2; art 3 s 1-5; art 7 s 3; art 11 s 52;
1Sp2003 c 12 art 4 s 1,2; art 6 s 5; 2004 c 267 art 1 s 2-4; art 2 s 3; art 3 s 3; art 15 s 1; art 17 s
3; 2005 c 10 art 5 s 1,4,5; 2005 c 125 art 3 s 1-3; 1Sp2005 c 8 art 1 s 9,10; art 3 s 2; art 4 s 5; art
10 s 38,39; 2006 c 271 art 3 s 5-11; 2007 c 6 s 1; 2007 c 134 art 1 s 4; art 2 s 13-17; art 4 s 1-7

NOTE: Subdivision 16a, as added by Laws 2000, chapter 461, article 4, section 3, is
repealed effective May 16, 2007. Laws 2000, chapter 461, article 4, section 4, paragraph (b), as
amended by Laws 2003, First Special Session chapter 12, article 6, section 3; Laws 2004, chapter
267, article 17, section 7; Laws 2005 chapter 156, article 4, section 10; and Laws 2005, First
Special Session chapter 8, article 2, section 4.

NOTE: The amendments to subdivisions 2b, 2d, and 6 by Laws 2005, chapter 125, article
3, sections 1 to 3, are effective the day after the Hennepin County Board files a certificate of
local approval in compliance with section 645.021, subdivision 3. Laws 2005, chapter 125,
article 1, section 29, as amended by Laws 2005, First Special Session chapter 7, section 34; and
Laws 2005, chapter 125, article 3, section 7.
353.011 [Repealed, 1996 c 310 s 1]
353.015 [Repealed, 1973 c 753 s 85]
353.016 [Repealed, 1977 c 429 s 65]
353.0161 AUTHORIZED LEAVE OF ABSENCE SERVICE CREDIT PURCHASE
PROCEDURE.
    Subdivision 1. Application. This section applies to employees covered by any plan specified
in this chapter or chapter 353E for any period of authorized leave of absence specified in section
353.01, subdivision 16, paragraph (a), clause (4), for which the employee obtains credit for
allowable service by making payment as specified in this section to the applicable fund.
    Subd. 2. Purchase procedure. (a) An employee covered by a plan specified in subdivision
1 may purchase credit for allowable service in that plan for a period specified in subdivision 1
if the employee makes a payment as specified in paragraph (b) or (c), whichever applies. The
employing unit, at its option, may pay the employer portion of the amount specified in paragraph
(b) on behalf of its employees.
    (b) If payment is received by the executive director within one year from the end of the
authorized leave, the payment amount is equal to the employee and employer contribution rates
specified in law for the applicable plan at the end of the leave period multiplied by the employee's
hourly rate of salary on the date of return from the leave of absence and by the days and months
of the leave of absence for which the employee wants allowable service credit. Payments made
under this paragraph must include compound interest at a monthly rate of 0.71 percent from the
last day of the leave period until the last day of the month in which payment is received.
    (c) If payment is received by the executive director after one year, the payment amount is the
amount determined under section 356.551.
History: 2007 c 134 art 2 s 18
353.017 EMPLOYEES OF LABOR ORGANIZATIONS.
    Subdivision 1. Qualifications. Unless specifically exempt under section 353.01, subdivision
2b
, a coordinated member of the association who is on an authorized leave of absence, and who
is an employee of a labor organization that represents public employees who are association
members may elect, under subdivision 2, to continue to be a coordinated member with respect to
employment by the labor organization subject to the limitations set forth in subdivisions 4 and 7.
    Subd. 2. Election. A person described in subdivision 1 is covered by the association if
written election to be covered is delivered to the association within six months of employment by
the labor organization or within six months after July 1, 1993, whichever is applicable.
    Subd. 3. Contributions. The employee, employer and additional employer contributions are
the obligation of the employee who elects coverage herein in accord with this chapter; provided,
however, the employer, labor organization may pay the employer and additional employer
contributions. The employer shall, in any event, deduct the necessary contributions from the
employee's salary, subject to the limitations under subdivision 6, and remit all contributions to the
public employees retirement association under section 353.27, subdivisions 4, 7, 10, 11, and 12.
    Subd. 4.MS 1980 [Repealed, 1982 c 404 s 10]
    Subd. 4. Termination of membership for retirement eligibility. A retirement annuity is
only payable, if the person has met any other applicable requirements, upon the termination by the
person who elected coverage under subdivision 1 of employment by the labor organization. The
reemployed annuitant earnings limitation set forth in section 353.37, subdivision 1, applies in
the event that the person who elected coverage under subdivision 1 retires and is subsequently
reemployed while an annuitant by the labor organization or by any other entity employing persons
who are covered by the Public Employees Retirement Association by virtue of that employment.
    Subd. 5. Board membership excluded. Persons who become association members pursuant
to this section shall not be eligible for election to the board of trustees.
    Subd. 6. Reemployment of annuitant. The annuity of a person otherwise eligible for an
annuity under this chapter is subject to the provisions of section 353.37.
    Subd. 7. Limitations on salary and contributions. The covered salary for a labor
organization employee who qualifies for membership under this section is limited to the lesser of:
(1) the employee's actual salary as defined under section 353.01, subdivision 10; or
(2) 75 percent of the salary of the governor as set under section 15A.082.
The limited covered salary determined under this subdivision must be used in determining
employee and employer contributions under section 353.27, subdivisions 2, 3, and 3a, and in
determining retirement annuities and other benefits under this chapter and chapter 356.
History: 1975 c 102 s 4; 1978 c 796 s 27; 1979 c 216 s 5; 1986 c 444; 1993 c 307 art 4 s
16; 1994 c 528 art 2 s 5; art 4 s 4-7
353.018 [Repealed, 1977 c 429 s 65]
353.019 [Repealed, 1977 c 429 s 65]
353.02 [Repealed, 1957 c 935 s 27]
353.022 [Repealed, 1981 c 68 s 46]
353.023 [Repealed, 1982 c 404 s 10]
353.024 [Repealed, 2000 c 461 art 3 s 47]
353.025 RANGE ASSOCIATION OF MUNICIPALITIES AND SCHOOLS.
Employees of the Range Association of Municipalities and Schools are coordinated members
of the general employees retirement plan of the Public Employees Retirement Association
unless specifically exempt under section 353.01, subdivision 2b. The Range Association of
Municipalities and Schools is a governmental subdivision for the purposes of this chapter.
History: 1981 c 68 s 20; 1Sp2005 c 8 art 10 s 40
353.026 COVERAGE FOR CERTAIN MUNICIPAL AND SCHOOL DISTRICT
EMPLOYEES.
Any person who was employed by the city of Minneapolis, Special School District No. 1,
or public corporation as defined in section 422A.01, subdivision 9, on or after July 1, 1978, and
before July 1, 1979, and who was excluded from retirement coverage by the coordinated program
of the Minneapolis municipal employees retirement fund under section 422A.09, subdivision
3
, is entitled to retirement coverage by the general employees retirement plan of the Public
Employees Retirement Association unless specifically excluded under section 353.01, subdivision
2b
, from and after May 19, 1981.
History: 1981 c 224 s 77; 1Sp2005 c 8 art 10 s 41
353.027 [Repealed, 2006 c 260 art 5 s 54]
353.028 CITY MANAGERS; ELECTION; DEFERRED COMPENSATION.
    Subdivision 1. Definitions. (a) For purposes of this section, each of the terms in this
subdivision has the meaning indicated.
(b) "City manager" means (1) a person who is duly appointed to and is holding the
position of city manager in a Plan B statutory city or in a home rule city operating under the
"council-manager" form of government, or (2) a person who is appointed to and is holding the
position of chief administrative officer of a home rule charter city or a statutory city under a
charter provision, ordinance, or resolution establishing such a position and prescribing its duties
and responsibilities.
(c) "Governing body" means the city council of the city employing the city manager.
(d) "Election" means the election described in subdivision 2.
    Subd. 2. Election. (a) A city manager may elect to be excluded from membership in the
general employees retirement plan of the Public Employees Retirement Association. The election
of exclusion must be made within six months following the commencement of employment, must
be made in writing on a form prescribed by the executive director, and must be approved by a
resolution adopted by the governing body of the city. The election of exclusion is not effective
until it is filed with the executive director. Membership of a city manager in the general employees
retirement plan ceases on the date the written election is received by the executive director or
upon a later date specified. Employee and employer contributions made on behalf of a person
exercising the option to be excluded from membership under this section must be refunded in
accordance with section 353.27, subdivision 7.
(b) A city manager who has elected exclusion under this subdivision may elect to revoke
that action by filing a written notice with the executive director. The notice must be on a form
prescribed by the executive director and must be approved by a resolution of the governing body
of the city. Membership of the city manager in the association resumes prospectively from the
date of the first day of the pay period for which contributions were deducted or, if pay period
coverage dates are not provided, the date on which the notice of revocation or contributions are
received in the office of the association, provided that the notice of revocation is received by the
association within 60 days of the receipt of contributions.
(c) An election under paragraph (b) is irrevocable. Any election under paragraph (a) or (b)
must include a statement that the individual will not seek authorization to purchase service credit
for any period of excluded service.
    Subd. 3. Deferred compensation; city contribution. (a) If an election of exclusion under
subdivision 2 is made, and if the city manager and the governing body of the city additionally
agree in writing that the additional compensation is to be deferred and is to be contributed on
behalf of the city manager to a deferred compensation program which meets the requirements
of section 457 of the Internal Revenue Code of 1986, as amended, the governing body may
compensate the city manager, in addition to the salary allowed under any limitation imposed on
salaries by law or charter, in an amount equal to the employer contribution which would be
required by section 353.27, subdivision 3, if the city manager were a member of the general
employees retirement plan.
(b) Alternatively, if an election of exclusion under subdivision 2 is made, the city manager
and the governing body of the city may agree in writing that the equivalent employer contribution
to the contribution under section 353.27, subdivision 3, be contributed by the city to the defined
contribution plan of the Public Employees Retirement Association under chapter 353D.
    Subd. 4. Refunds; deferred annuity. A city manager who makes an election to be excluded
from membership is entitled to a refund of accumulated deductions or, if otherwise qualified, a
deferred annuity under section 353.34, at the option of the manager.
    Subd. 5. Election; other employment. If a city manager who has made an election to be
excluded subsequently accepts employment in another governmental subdivision or subsequently
accepts employment other than as a city manager in the same city, the election is rescinded on
the effective date of employment.
History: 1981 c 254 s 1; 1988 c 709 art 5 s 8; 1Sp2003 c 12 art 4 s 3; 1Sp2005 c 8 art 10 s
43; 2006 c 271 art 3 s 12
353.03 BOARD OF TRUSTEES.
    Subdivision 1. Management; composition; election. (a) The management of the public
employees retirement fund is vested in an 11-member board of trustees consisting of ten members
and the state auditor. The state auditor may designate a deputy auditor with expertise in pension
matters as the auditor's representative on the board. The governor shall appoint five trustees to
four-year terms, one of whom shall be designated to represent school boards, one to represent
cities, one to represent counties, one who is a retired annuitant, and one who is a public member
knowledgeable in pension matters. The membership of the association, including recipients of
retirement annuities and disability and survivor benefits, shall elect five trustees for terms of four
years, one of whom must be a member of the police and fire fund and one of whom must be a
former member who met the definition of public employee under section 353.01, subdivisions 2
and 2a
, for at least five years prior to terminating membership or a member who receives a
disability benefit. Terms expire on January 31 of the fourth year, and positions are vacant until
newly elected members are seated. Except as provided in this subdivision, trustees elected by the
membership of the association must be public employees and members of the association.
(b) For seven days beginning October 1 of each year preceding a year in which an election is
held, the association shall accept at its office filings in person or by mail of candidates for the
board of trustees. A candidate shall submit at the time of filing a nominating petition signed by
25 or more members of the association. No name may be withdrawn from nomination by the
nominee after October 15. At the request of a candidate for an elected position on the board of
trustees, the board shall mail a statement of up to 300 words prepared by the candidate to all
persons eligible to vote in the election of the candidate. The board may adopt policies, subject to
review and approval by the secretary of state under paragraph (e), to govern the form and length
of these statements, timing of mailings, and deadlines for submitting materials to be mailed. The
secretary of state shall resolve disputes between the board and a candidate concerning application
of these policies to a particular statement.
(c) By January 10 of each year in which elections are to be held, the board shall distribute
by mail to the members ballots listing the candidates. No member may vote for more than
one candidate for each board position to be filled. A ballot indicating a vote for more than
one person for any position is void. No special marking may be used on the ballot to indicate
incumbents. Ballots mailed to the association must be postmarked no later than January 31. The
ballot envelopes must be so designated and the ballots must be counted in a manner that ensures
that each vote is secret.
(d) A candidate who receives contributions or makes expenditures in excess of $100, or
has given implicit or explicit consent for any other person to receive contributions or make
expenditures in excess of $100 for the purpose of bringing about the candidate's election, shall file
a report with the campaign finance and public disclosure board disclosing the source and amount
of all contributions to the candidate's campaign. The campaign finance and public disclosure
board shall prescribe forms governing these disclosures. Expenditures and contributions have
the meaning defined in section 10A.01. These terms do not include the mailing made by the
association board on behalf of the candidate. A candidate shall file a report within 30 days
from the day that the results of the election are announced. The Campaign Finance and Public
Disclosure Board shall maintain these reports and make them available for public inspection in
the same manner as the board maintains and makes available other reports filed with it.
(e) The secretary of state shall review and approve the procedures defined by the board
of trustees for conducting the elections specified in this subdivision, including board policies
adopted under paragraph (b).
(f) The board of trustees and the executive director shall undertake their activities consistent
with chapter 356A.
    Subd. 1a. Vacancy, how filled. Any vacancy on the board caused by death, resignation, or
removal of any trustee, or occurring because an elected trustee ceases to be a public employee
and an active member of the association, must be filled by the board for trustees elected by
members, and by the governor for other trustees, for the unexpired portion of the term in which
the vacancy occurs. The board shall adopt policies and procedures governing how the vacancy
of an elected trustee is to be filled.
    Subd. 2. No compensation expenses. The members of the board of trustees shall serve
without compensation, but shall be reimbursed out of the retirement fund for expenses actually
and necessarily paid or incurred in the performance of their duties. Members of the board of
trustees shall suffer no loss of compensation from a public employer by reason of service on or
for the board or on any authorized committee thereof.
    Subd. 2a.[Repealed, 1977 c 429 s 65]
    Subd. 2b. Board legal authority. The board is authorized to take legal action when
necessary to effectively administer the various retirement plans administered by the association,
consistent with applicable articles of incorporation, bylaws, law, and rules, as applicable, and
including, but not limited to, the recapture of overpaid annuities, benefits, or refunds, and the
correction of omitted or deficient deductions.
    Subd. 3. Duties and powers of the board. (a) The board shall:
    (1) elect a president and vice-president;
    (2) approve the staffing complement, as recommended by the executive director, necessary
to administer the fund;
     (3) adopt bylaws for its own government and for the management of the fund consistent with
the laws of the state and may modify them at pleasure;
    (4) adopt, alter, and enforce reasonable rules consistent with the laws of the state and the
terms of the applicable benefit plans for the administration and management of the fund, for the
payment and collection of payments from members and for the payment of withdrawals and
benefits, and that are necessary in order to comply with the applicable federal Internal Revenue
Service and Department of Labor requirements;
    (5) pass upon and allow or disallow all applications for membership in the fund and allow or
disallow claims for withdrawals, pensions, or benefits payable from the fund;
    (6) adopt an appropriate mortality table based on experience of the fund as recommended by
the association actuary and approved under section 356.215, subdivision 18, with interest set at
the rate specified in section 356.215, subdivision 8;
    (7) provide for the payment out of the fund of the cost of administering this chapter, of all
necessary expenses for the administration of the fund and of all claims for withdrawals, pensions,
or benefits allowed; and
    (8) approve or disapprove all recommendations and actions of the executive director made
subject to its approval or disapproval by subdivision 3a.
    (b) In passing upon all applications and claims, the board may summon, swear, hear, and
examine witnesses and, in the case of claims for disability benefits, may require the claimant to
submit to a medical examination by a physician of the board's choice, at the expense of the fund,
as a condition precedent to the passing on the claim, and, in the case of all applications and
claims, may conduct investigations necessary to determine their validity and merit.
    (c) The board may continue to authorize the sale of life insurance to members under the
insurance program in effect on January 1, 1985, but must not change that program without the
approval of the commissioner of finance. The association shall not receive any financial benefit
from the life insurance program beyond the amount necessary to reimburse the association for
costs incurred in administering the program. The association shall not engage directly or indirectly
in any other activity involving the sale or promotion of goods or services, or both, whether to
members or nonmembers.
    (d) The board shall establish procedures governing reimbursement of expenses to board
members. These procedures must define the types of activities and expenses that qualify for
reimbursement, must provide that all out-of-state travel be authorized by the board, and must
provide for the independent verification of claims for expense reimbursement. The procedures
must comply with the applicable rules and policies of the Department of Finance, the Department
of Administration, and the Department of Employee Relations.
    (e) The board may purchase fiduciary liability insurance and official bonds for the officers
and members of the board of trustees and employees of the association and may purchase
property insurance or may establish a self-insurance risk reserve including, but not limited to, data
processing insurance and "extra-expense" coverage.
    Subd. 3a. Executive director. (a) Appointment. The board shall appoint an executive
director on the basis of education, experience in the retirement field, and leadership ability. The
executive director must have had at least five years' experience in an executive level management
position, which has included responsibility for pensions, deferred compensation, or employee
benefits. The executive director serves at the pleasure of the board. The salary of the executive
director is as provided by section 15A.0815.
    (b) Duties. The management of the association is vested in the executive director who
shall be the executive and administrative head of the association. The executive director shall
act as adviser to the board on all matters pertaining to the association and shall also act as the
secretary of the board. The executive director shall:
    (1) attend all meetings of the board;
    (2) prepare and recommend to the board appropriate rules to carry out the provisions
of this chapter;
    (3) establish and maintain an adequate system of records and accounts following recognized
accounting principles and controls;
    (4) designate, with the approval of the board, up to two persons who may serve in the
unclassified service and whose salaries are set in accordance with section 43A.18, subdivision 3,
appoint a confidential secretary in the unclassified service, and appoint employees to carry out
this chapter, who are subject to chapters 43A and 179A in the same manner as are executive
branch employees;
    (5) organize the work of the association as the director deems necessary to fulfill the
functions of the association, and define the duties of its employees and delegate to them any
powers or duties, subject to the control of, and under such conditions as, the executive director
may prescribe;
    (6) with the approval of the board, contract for the services of an approved actuary,
professional management services, and any other consulting services as necessary to fulfill
the purposes of this chapter. All contracts are subject to chapter 16C. The commissioner of
administration shall not approve, and the association shall not enter into, any contract to provide
lobbying services or legislative advocacy of any kind. Any approved actuary retained by the
executive director shall function as the actuarial advisor of the board and the executive director
and may perform actuarial valuations and experience studies to supplement those performed by
the actuary retained under section 356.214. Any supplemental actuarial valuations or experience
studies shall be filed with the executive director of the Legislative Commission on Pensions
and Retirement. Copies of professional management survey reports shall be transmitted to
the secretary of the senate, the chief clerk of the house of representatives, and the Legislative
Reference Library as provided by section 3.195, and to the executive director of the commission
at the same time as reports are furnished to the board. Only management firms experienced in
conducting management surveys of federal, state, or local public retirement systems shall be
qualified to contract with the director hereunder;
    (7) with the approval of the board provide in-service training for the employees of the
association;
    (8) make refunds of accumulated contributions to former members and to the designated
beneficiary, surviving spouse, legal representative or next of kin of deceased members or deceased
former members, as provided in this chapter;
    (9) determine the amount of the annuities and disability benefits of members covered by the
association and authorize payment of the annuities and benefits beginning as of the dates on which
the annuities and benefits begin to accrue, in accordance with the provisions of this chapter;
    (10) pay annuities, refunds, survivor benefits, salaries, and necessary operating expenses of
the association;
    (11) prepare and submit to the board and the legislature an annual financial report covering
the operation of the association, as required by section 356.20;
    (12) prepare and submit biennial and annual budgets to the board for its approval and submit
the approved budgets to the Department of Finance for approval by the commissioner;
    (13) reduce all or part of the accrued interest payable under section 353.27, subdivisions
12, 12a, and 12b
, or 353.28, subdivision 5, upon receipt of proof by the association of an
unreasonable processing delay or other extenuating circumstances of the employing unit. The
executive director shall prescribe and submit for approval by the board the conditions under which
such interest may be reduced; and
    (14) with the approval of the board, perform such other duties as may be required for the
administration of the association and the other provisions of this chapter and for the transaction
of its business.
    Subd. 4. Offices. The commissioner of administration shall make provision for suitable
office space in the public pension fund facilities created under section 356B.10.
    Subd. 5. Application of laws. Laws applicable to state agencies and agencies with statewide
jurisdiction shall apply to the association.
History: (254-25) 1931 c 307 s 3; 1949 c 84 s 2; 1951 c 22 s 16; 1959 c 650 s 8,58; 1963 c
641 s 13; 1967 c 641 s 1; 1969 c 940 s 3; 1971 c 106 s 10,11; 1973 c 753 s 19,20; 1974 c 229 s
9; 1975 c 102 s 5-8; 1976 c 329 s 17,18; 1977 c 429 s 18; 1978 c 796 s 28; 1979 c 216 s 6,7;
1981 c 180 s 2-4; 1981 c 224 s 79; 1984 c 462 s 27; 1985 c 11 s 5-10; 1986 c 444; 1987 c 259
s 26; 1987 c 284 art 5 s 3; 1988 c 709 art 5 s 9; 1989 c 319 art 8 s 16; 1991 c 341 s 7; 1994
c 528 art 2 s 6,7; 1997 c 202 art 2 s 63; 2Sp1997 c 3 s 18; 1998 c 386 art 2 s 87; 1999 c 99 s
16; 1999 c 222 art 22 s 2; 2002 c 392 art 11 s 52; 2004 c 223 s 3; 2006 c 271 art 3 s 13-15;
2007 c 134 art 2 s 19-21; art 6 s 1
353.031 DISABILITY DETERMINATION PROCEDURES.
    Subdivision 1. Application. This section applies to all disability determinations for the public
employees general fund, the public employees police and fire fund, and the local government
correctional service retirement plan and any other disability determination subject to approval
by the board, except as otherwise specified in section 353.33, 353.656, or 353E.05. These
requirements and the requirements of section 353.03, subdivision 3, are in addition to the specific
requirements of each plan and govern in the event there is any conflict between these sections and
the procedures specific to any of those plans under section 353.33, 353.656, or 353E.06.
    Subd. 2. Plan document policy statement. Disability determinations for the public
employees general fund must be made subject to section 353.01, subdivision 19; and for the
police and fire plan and the local government correctional service retirement plan must be made
consistent with the legislative policy and intent set forth in section 353.63.
    Subd. 3. Procedure to determine eligibility; generally. (a) Every claim for a disability
benefit must be initiated in writing on an application form and in the manner prescribed by the
executive director and filed with the executive director. An application for disability benefits must
be made within 18 months following termination of public service as defined under section
353.01, subdivision 11a.
    (b) All medical reports must support a finding that the disability arose before the employee
was placed on any paid or unpaid leave of absence or terminated public service, as defined under
section 353.01, subdivision 11a.
    (c) An applicant for disability shall provide a detailed report signed by a licensed medical
doctor and at least one additional report signed by a medical doctor, psychologist, or chiropractor.
The applicant shall authorize the release of all medical and health care evidence, including all
medical records and relevant information from any source, to support the application for initial, or
the continuing payment of, disability benefits.
    (d) All reports must contain an opinion regarding the claimant's prognosis, the duration
of the disability, and the expectations for improvement. Any report that does not contain and
support a finding that the disability will last for at least one year may not be relied upon to support
eligibility for benefits.
    (e) Where the medical evidence supports the expectation that at some point in time the
claimant will no longer be disabled, any decision granting disability may provide for a termination
date upon which disability can be expected to no longer exist. In the event a termination date is
made part of the decision granting benefits, prior to the actual termination of benefits, the claimant
shall have the opportunity to show that the disabling condition for which benefits were initially
granted continues. In the event the benefits terminate in accordance with the original decision, the
claimant may petition for a review by the board of trustees under section 353.03, subdivision 3,
or may reapply for disability in accordance with these procedures and section 353.33, 353.656,
or 353E.06, as applicable.
    (f) Any claim to disability must be supported by a report from the employer indicating that
there is no available work that the employee can perform in the employee's disabled condition
and that all reasonable accommodations have been considered. Upon request of the executive
director, an employer shall provide evidence of the steps the employer has taken to attempt to
provide reasonable accommodations and continued employment to the claimant. The employer
shall also provide a certification of the member's past public service; the dates of any paid sick
leave, vacation, or any other employer-paid salary continuation plan beyond the last working day;
and whether or not any sick or annual leave has been allowed.
    (g) An employee who is placed on leave of absence without compensation because of a
disability is not barred from receiving a disability benefit.
    (h) An applicant for disability benefits may file a retirement annuity application under section
353.29, subdivision 4, simultaneously with an application for disability benefits. If the application
for disability benefits is approved, the retirement annuity application is cancelled. If disability
benefits are denied, the retirement annuity application must be processed upon the request of the
applicant. No member of the public employees general plan, the public employees police and fire
plan, or the local government correctional service retirement plan may receive a disability benefit
and a retirement annuity simultaneously from the same plan.
    Subd. 4. Additional requirements to determine eligibility for police and fire or local
government correctional service plan disability benefits. (a) If an application for disability
benefits is filed within two years of the date of the injury or the onset of the illness that gave rise
to the disability application, the application must be supported by evidence that the applicant is
unable to perform the duties of the position held by the applicant on the date of the injury or
the onset of the illness causing the disability. The employer must provide evidence indicating
whether the applicant is able or unable to perform the duties of the position held on the date of the
injury or onset of the illness causing the disability and the specifications of any duties that the
individual can or cannot perform.
    (b) If an application for disability benefits is filed more than two years after the date of injury
or the onset of an illness causing the disability, the application must be supported by evidence that
the applicant is unable to perform the most recent duties that are expected to be performed by
the applicant during the 90 days before the filing of the application. The employer must provide
evidence of the duties that are expected to be performed by the applicant during the 90 days
before the filing of the application, whether the applicant can or cannot perform those duties
overall, and the specifications of any duties that the applicant can or cannot perform.
    (c) Any report supporting a claim to disability benefits under section 353.656 or 353E.06
must specifically relate the disability to its cause; and for any claim to duty disability from an
injury or illness arising out of an act of duty, the report must relate the cause of disability to
specific tasks or functions required to be performed by the employee in fulfilling the employee's
duty-related acts which must be specific to the inherent dangers of the positions eligible for
membership in the police and fire fund and the local government correctional service retirement
plan. Any report that does not relate the cause of disability to specific acts or functions performed
by the employee may not be relied upon as evidence to support eligibility for benefits and may be
disregarded in the executive director's decision-making process.
    (d) Any application for duty disability must be supported by a first report of injury as
defined in section 176.231.
    (e) If a member who has applied for and been approved for disability benefits before the
termination of service does not terminate service or is not placed on an authorized leave of
absence as certified by the governmental subdivision within 45 days following the date on which
the application is approved, the application shall be canceled. If an approved application for
disability benefits has been canceled, a subsequent application for disability benefits may not be
filed on the basis of the same medical condition for a minimum of one year from the date on
which the previous application was canceled.
    Subd. 5. Medical adviser. The executive director may contract with licensed physicians or
physicians on the staff of the state commissioner of health, as designated by the commissioner, to
be the medical adviser of the association. The medical adviser shall review all medical reports
submitted to the association, including the findings of an independent medical examination
requested under this section, and shall advise the executive director.
    Subd. 6. Independent medical examination. Any individual applying for or receiving
disability benefits must submit to an independent medical examination if requested by the
executive director. The medical examination must be paid for by the association.
    Subd. 7. Refusal of examination or medical evidence. If a person applying for or receiving
a disability benefit refuses to submit to a medical examination under subdivision 6, or fails to
provide or to authorize the release of medical evidence under subdivision 3, the association shall
cease the application process or shall discontinue the payment of a disability benefit, whichever
is applicable. Upon the receipt of the requested medical evidence, the association shall resume
the application process or the payment of a disability benefit upon approval for the continuation,
whichever is applicable.
    Subd. 8. Proof of continuing disability. (a) A disability benefit payment must not be made
except upon adequate proof furnished to the executive director of the association that the person
remains disabled.
    (b) During the time when disability benefits are being paid, the executive director of the
association has the right, at reasonable times, to require the disabled member to submit proof
of the continuance of the disability claimed.
    (c) Adequate proof of a disability must include a written expert report by a licensed physician,
a licensed chiropractor, or, with respect to a mental impairment, a licensed psychologist.
    Subd. 9. Application approval or denial; decision of executive director. Any decision of
the executive director is final, except that a member whose application for disability benefits or
whose continuation of disability benefits is denied may appeal the executive director's decision to
the board of trustees within 60 days of receipt of a certified letter notifying the member of the
decision to deny the application or continuation of benefits. In developing the record for review
by the board when a decision is appealed, the executive director may direct that the applicant
participate in a fact-finding session conducted by an administrative law judge assigned by the
Office of Administrative Hearings, and, as applicable, a vocational assessment conducted by the
qualified rehabilitation counselor on contract with the Public Employees Retirement Association.
    Subd. 10. Restoring forfeited service. To restore forfeited service, a repayment of a refund
must be made within six months after the effective date of disability benefits or within six months
after the date of the filing of the disability application, whichever is later. No purchase of prior
service or payment made in lieu of salary deductions otherwise authorized under section 353.01
may be made after the occurrence of the disability for which an application is filed under this
section.
History: 2007 c 134 art 4 s 8
353.04 [Repealed, 1957 c 935 s 27]
353.05 CUSTODIAN OF FUNDS.
The commissioner of finance shall be ex officio treasurer of the retirement funds of
the association and the general bond of the commissioner of finance to the state shall be so
conditioned as to cover all liability for acts as treasurer of these funds. All moneys of the
association received by the commissioner of finance shall be set aside in the state treasury to the
credit of the proper fund. The commissioner of finance shall transmit monthly to the executive
director a detailed statement of all amounts so received and credited to the fund. Payments out
the fund shall be made only on warrants issued by the commissioner of finance, upon abstracts
signed by the executive director; provided that abstracts for investment may be signed by the
secretary of the State Board of Investment.
History: (254-27) 1931 c 307 s 5; 1959 c 650 s 58; 1971 c 106 s 12; 1974 c 229 s 10; 1975 c
102 s 6; 1986 c 444; 2003 c 112 art 2 s 50
353.06 STATE BOARD OF INVESTMENT TO INVEST FUNDS.
The executive director shall from time to time certify to the State Board of Investment
for investment such portions of the retirement fund as in its judgment may not be required for
immediate use. Assets from the public employees retirement fund shall be transferred to the
Minnesota postretirement investment fund as provided in section 11A.18. The State Board of
Investment shall thereupon invest and reinvest the sum so certified, or transferred, in such
securities as are duly authorized as legal investments for state employees retirement fund and
shall have authority to sell, convey, and exchange such securities and invest and reinvest the
securities when it deems it desirable to do so and shall sell securities upon request of the board of
trustees when such funds are needed for its purposes. All of the provisions regarding accounting
procedures and restrictions and conditions for the purchase and sale of securities for the state
employees retirement fund shall apply to the accounting, purchase and sale of securities for the
public employees retirement fund.
History: (254-28) 1931 c 307 s 6; 1959 c 650 s 58; 1961 c 380 s 5; 1965 c 305 s 5; 1973 c
753 s 21; 1975 c 102 s 6; 1980 c 607 art 14 s 45 subd 2; s 46
353.07 [Repealed, 1973 c 753 s 85]
353.08 LEGAL ADVISER, ATTORNEY GENERAL; VENUE.
The attorney general shall be the legal adviser of the board of trustees. The board may sue or
be sued in the name of the board of trustees of the Public Employees Retirement Association and,
in all actions brought by it or against it, the board shall be represented by the attorney general.
The venue of all actions against and by the Public Employees Retirement Association shall
be Ramsey County.
History: (254-30) 1931 c 307 s 8; 1933 c 374 s 1; 1959 c 650 s 58; 1973 c 753 s 22; 1975
c 102 s 9
353.09 [Repealed, 1957 c 935 s 27]
353.10 [Repealed, 1957 c 935 s 27]
353.11 [Repealed, 1957 c 935 s 27]
353.12 [Repealed, 1957 c 935 s 27]
353.13 [Repealed, 1973 c 753 s 85]
353.14 BENEFITS FROM OTHER FUNDS.
No annuity or benefit provided by this chapter may be affected, diminished, or impaired by
any pension, benefit, or annuity which any member or survivor is entitled to receive from a tax
supported public retirement plan or system authorized by any other law based on service that is
different service than the service for which the member or survivor is entitled to receive benefit or
annuity from a retirement plan administered by the Public Employees Retirement Association.
History: 1963 c 641 s 1; 1973 c 753 s 23; 1986 c 444; 1Sp2005 c 8 art 10 s 44
353.15 NONASSIGNABILITY AND EXEMPTION OF ANNUITIES AND BENEFITS
FROM JUDICIAL PROCESS.
    Subdivision 1. Exemption. The provisions of section 356.401 apply to the general
employees retirement plan, to the public employees police and fire retirement plan, and to the
local government correctional service retirement plan.
    Subd. 2.[Repealed, 1Sp2005 c 8 art 10 s 81]
    Subd. 3. Payment to public bodies. If, in the judgment of the executive director, conditions
so warrant, payment of an annuity, a retirement benefit, or a refund may be made to a public body
in behalf of an annuitant, disabilitant, or survivor upon such terms as the executive director
may prescribe.
History: (254-40) 1931 c 307 s 18; 1955 c 815 s 9; 1971 c 789 s 5; 1973 c 753 s 24; 1975
c 102 s 6,10; 1976 c 329 s 19; 1978 c 772 s 62; 1979 c 303 art 3 s 29; 1981 c 180 s 5; 1984 c
547 s 6; 1986 c 444; 1987 c 157 s 5; 1990 c 570 art 11 s 4; 1997 c 203 art 6 s 92; 2000 c 461
art 3 s 13; 2003 c 127 art 3 s 19; 1Sp2005 c 8 art 10 s 45,46
353.16 AUDIT OF BOOKS AND ACCOUNTS; INSURANCE LAWS NOT APPLICABLE.
None of the laws of this state regulating insurance or insurance companies shall apply to
the retirement association or any of its funds. The books and accounts of the association and
the retirement fund shall be examined and audited annually, if funds and personnel permit, by
the legislative auditor of the state and a full and detailed report thereof made to the board of
trustees. The cost of any examination shall be paid by the retirement association in accordance
with the provisions of section 16A.127, subdivision 7, and for the purposes of this section the
public employees retirement association shall be considered a state agency as referred to in
section 16A.127, subdivision 7.
History: (254-41) 1931 c 307 s 19; 1933 c 374 s 1; 1959 c 645 s 1; 1959 c 650 s 58; 1971
c 106 s 15; 1974 c 229 s 11; 1979 c 50 s 45; 1981 c 224 s 80
353.17 [Repealed, 1971 c 106 s 40]
353.18 RULES.
All matters and administrative details not specifically provided for in this chapter shall be
governed by rules issued and promulgated by the board of trustees. The final power to determine
the status of any individual in the employ of any governmental subdivision, for the purposes of
this chapter, is hereby vested in the board, and such determination shall not be disturbed unless
found to be arbitrary and capricious.
History: (254-44) 1931 c 307 s 22; 1941 c 285 s 9; 1959 c 650 s 58; 1973 c 753 s 25;
1985 c 248 s 70
353.19 PENALTIES FOR FALSE INFORMATION.
Any person who shall give any false information to the board of trustees or any officer or
agent of the retirement association, or any person who shall willfully fail or refuse to perform
or discharge any duty prescribed by this chapter shall, upon conviction thereof, be guilty of a
gross misdemeanor.
History: (254-45) 1931 c 307 s 23; 1959 c 650 s 58; 1973 c 753 s 26
353.20 [Repealed, 1955 c 815 s 12]
353.21 [Repealed, 1957 c 935 s 27]
353.26    Subdivision 1.[Repealed, 1973 c 753 s 85]
    Subd. 2.[Repealed, 1973 c 753 s 85]
    Subd. 3.[Repealed, 1973 c 753 s 85]
    Subd. 4.[Repealed, 1959 c 650 s 57]
    Subd. 5.[Repealed, 1973 c 753 s 85]
    Subd. 6.[Repealed, 1973 c 753 s 85]
353.27 PUBLIC EMPLOYEES RETIREMENT FUND.
    Subdivision 1. Income; disbursements. There is a special fund known as the "public
employees retirement fund," the "retirement fund," or the "fund," which shall include all the assets
of the association. This fund shall be credited with all contributions, all interest and all other
income authorized by law. From this fund there is appropriated the payments authorized by this
chapter in the amounts and at such time provided herein, including the expenses of administering
the fund, and including the proper share of the Minnesota postretirement investment fund.
    Subd. 2. Employee contribution. (a) The employee contribution is the following applicable
percentage of the total salary amount for a "basic member" and for a "coordinated member":
Basic Program
Coordinated Program
Effective before January 1, 2006
9.10
5.10
Effective January 1, 2006
9.10
5.50
Effective January 1, 2007
9.10
5.75
Effective January 1, 2008
9.10
6.00 plus any contribution
rate adjustment under
subdivision 3b
(b) These contributions must be made by deduction from salary as defined in section 353.01,
subdivision 10
, in the manner provided in subdivision 4. If any portion of a member's salary is
paid from other than public funds, the member's employee contribution must be based on the total
salary received by the member from all sources.
    Subd. 3. Employer contribution. (a) The employer contribution is the following applicable
percentage of the total salary amount for "basic members" and for "coordinated members":
Basic Program
Coordinated Program
Effective before January 1, 2006
9.10
5.10
Effective January 1, 2006
9.10
5.50
Effective January 1, 2007
9.10
5.75
Effective January 1, 2008
9.10
6.00 plus any contribution
rate adjustment under
subdivision 3b
(b) This contribution must be made from funds available to the employing subdivision by the
means and in the manner provided in section 353.28.
    Subd. 3a. Additional employer contribution. (a) An additional employer contribution
must be made equal to the following applicable percentage of the total salary amount for "basic
members" and for "coordinated members":
Basic Program
Coordinated Program
Effective before January 1, 2006
2.68
.43
Effective January 1, 2006
2.68
.50
Effective January 1, 2009
2.68
.75
Effective January 1, 2010
2.68
1.00
These contributions must be made from funds available to the employing subdivision by the
means and in the manner provided in section 353.28.
(b) The coordinated program contribution rates set forth in paragraph (a) effective for
January 1, 2009, or January 1, 2010, must not be implemented if, following receipt of the July
1, 2008, or July 1, 2009, annual actuarial valuation reports under section 356.215, respectively,
the actuarially required contributions are equal to or less than the total rates under this section in
effect as of January 1, 2008.
(c) This subdivision is repealed once the actuarial value of the assets of the plan equal or
exceed the actuarial accrued liability of the plan as determined by the actuary retained under
sections 356.214 and 356.215. The repeal is effective on the first day of the first full pay period
occurring after March 31 of the calendar year following the issuance of the actuarial valuation
upon which the repeal is based.
    Subd. 3b. Change in employee and employer contributions in certain instances. (a)
For purposes of this section, a contribution sufficiency exists if the total of the employee
contribution under subdivision 2, the employer contribution under subdivision 3, the additional
employer contribution under subdivision 3a, and any additional contribution previously imposed
under this subdivision exceeds the total of the normal cost, the administrative expenses, and the
amortization contribution of the retirement plan as reported in the most recent actuarial valuation
of the retirement plan prepared by the actuary retained under section 356.214 and prepared
under section 356.215 and the standards for actuarial work of the Legislative Commission on
Pensions and Retirement. For purposes of this section, a contribution deficiency exists if the
total of the employee contributions under subdivision 2, the employer contributions under
subdivision 3, the additional employer contribution under subdivision 3a, and any additional
contribution previously imposed under this subdivision is less than the total of the normal cost,
the administrative expenses, and the amortization contribution of the retirement plan as reported
in the most recent actuarial valuation of the retirement plan prepared by the actuary retained under
section 356.214 and prepared under section 356.215 and the standards for actuarial work of the
Legislative Commission on Pensions and Retirement.
(b) Employee and employer contributions under subdivisions 2 and 3 must be adjusted:
(1) if, after July 1, 2010, the regular actuarial valuations of the general employees retirement
plan of the Public Employees Retirement Association under section 356.215 indicate that there is a
contribution sufficiency under paragraph (a) equal to or greater than 0.5 percent of covered payroll
for two consecutive years, the coordinated program employee and employer contribution rates
must be decreased as determined under paragraph (c) to a level such that the sufficiency equals no
more than 0.25 percent of covered payroll based on the most recent actuarial valuation; or
(2) if, after July 1, 2010, the regular actuarial valuations of the general employees retirement
plan of the Public Employees Retirement Association under section 356.215 indicate that there is
a deficiency equal to or greater than 0.5 percent of covered payroll for two consecutive years, the
coordinated program employee and employer contribution rates must be increased as determined
under paragraph (c) to a level such that no deficiency exists based on the most recent actuarial
valuation.
(c) The contribution rate increase or decrease must be determined by the executive director
of the Public Employees Retirement Association, must be reported to the chair and the executive
director of the Legislative Commission on Pensions and Retirement on or before the next
February 1, and, if the Legislative Commission on Pensions and Retirement does not recommend
against the rate change or does not recommend a modification in the rate change, is effective
on the next July 1 following the determination by the executive director that a contribution
deficiency or sufficiency has existed for two consecutive fiscal years based on the most recent
actuarial valuations under section 356.215. If the actuarially required contribution exceeds or is
less than the total support provided by the combined employee and employer contribution rates
by more than 0.5 percent of covered payroll, the coordinated program employee and employer
contribution rates must be adjusted incrementally over one or more years to a level such that there
remains a contribution sufficiency of no more than 0.25 percent of covered payroll.
(d) No incremental adjustment may exceed 0.25 percent for either the coordinated program
employee and employer contribution rates per year in which any adjustment is implemented. A
contribution rate adjustment under this subdivision must not be made until at least two years have
passed since fully implementing a previous adjustment under this subdivision.
    Subd. 4. Employer reporting requirements; contributions; member status. (a) A
representative authorized by the head of each department shall deduct employee contributions
from the salary of each employee who qualifies for membership under this chapter and remit
payment in a manner prescribed by the executive director for the aggregate amount of the
employee contributions, the employer contributions and the additional employer contributions to
be received within 14 calendar days. The head of each department or the person's designee shall
for each pay period submit to the association a salary deduction report in the format prescribed
by the executive director. Data required to be submitted as part of salary deduction reporting
must include, but are not limited to:
(1) the legal names and Social Security numbers of employees who are members;
(2) the amount of each employee's salary deduction;
(3) the amount of salary from which each deduction was made;
(4) the beginning and ending dates of the payroll period covered and the date of actual
payment; and
(5) adjustments or corrections covering past pay periods.
(b) Employers must furnish the data required for enrollment for each new employee who
qualifies for membership in the format prescribed by the executive director. The required
enrollment data on new employees must be submitted to the association prior to or concurrent
with the submission of the initial employee salary deduction. The employer shall also report to the
association all member employment status changes, such as leaves of absence, terminations, and
death, and shall report the effective dates of those changes, on an ongoing basis for the payroll
cycle in which they occur. The employer shall furnish data, forms, and reports as may be required
by the executive director for proper administration of the retirement system. Before implementing
new or different computerized reporting requirements, the executive director shall give
appropriate advance notice to governmental subdivisions to allow time for system modifications.
(c) Notwithstanding paragraph (a), the association may provide for less frequent reporting
and payments for small employers.
    Subd. 5.[Repealed, 1973 c 753 s 85]
    Subd. 5a.[Repealed, 1992 c 443 s 2]
    Subd. 6.[Repealed, 1971 c 106 s 40]
    Subd. 7. Adjustment for erroneous receipts or disbursements. (a) Except as provided
in paragraph (b), erroneous employee deductions and erroneous employer contributions and
additional employer contributions for a person, who otherwise does not qualify for membership
under this chapter, are considered:
(1) valid if the initial erroneous deduction began before January 1, 1990. Upon determination
of the error by the association, the person may continue membership in the association while
employed in the same position for which erroneous deductions were taken, or file a written
election to terminate membership and apply for a refund upon termination of public service
or defer an annuity under section 353.34; or
(2) invalid, if the initial erroneous employee deduction began on or after January 1, 1990.
Upon determination of the error, the association shall refund all erroneous employee deductions
and all erroneous employer contributions as specified in paragraph (d). No person may claim a
right to continued or past membership in the association based on erroneous deductions which
began on or after January 1, 1990.
(b) Erroneous deductions taken from the salary of a person who did not qualify for
membership in the association by virtue of concurrent employment before July 1, 1978, which
required contributions to another retirement fund or relief association established for the benefit
of officers and employees of a governmental subdivision, are invalid. Upon discovery of the
error, the association shall remove all invalid service and, upon termination of public service,
the association shall refund all erroneous employee deductions to the person, with interest under
section 353.34, subdivision 2, and all erroneous employer contributions to the employer. This
paragraph has both retroactive and prospective application.
(c) Employer contributions and employee deductions taken in error from amounts which are
not salary under section 353.01, subdivision 10, are invalid upon discovery by the association and
must be refunded as specified in paragraph (d).
(d) Upon discovery of the receipt of erroneous deductions and contributions under paragraph
(a), clause (2), or paragraph (c), the association must require the employer to discontinue the
erroneous employee deductions and erroneous employer contributions. Upon discontinuation, the
association either must refund the invalid employee deductions to the person without interest and
the invalid employer contributions to the employer or provide a credit against future contributions
payable by the employer for the amount of all erroneous deductions and contributions. If the
employing unit receives a credit under this paragraph, the employing unit is responsible for
refunding to the applicable employee any amount that had been erroneously deducted from the
person's salary. In the event that a retirement annuity or disability benefit has been computed
using invalid service or salary, the association must adjust the annuity or benefit and recover any
overpayment under subdivision 7b.
(e) In the event that a salary warrant or check from which a deduction for the retirement fund
was taken has been canceled or the amount of the warrant or check returned to the funds of the
department making the payment, a refund of the sum deducted, or any portion of it that is required
to adjust the deductions, must be made to the department or institution.
(f) Any refund to a member under this subdivision that is reasonably determined to cause the
plan to fail to be a qualified plan under section 401(a) of the federal Internal Revenue Code, as
amended, may not be refunded and instead must be credited against future contributions payable
by the employer. The employer receiving the credit is responsible for refunding to the applicable
employee any amount that had been erroneously deducted from the person's salary.
    Subd. 7a. Deductions or contributions transmitted by error. (a) If employee deductions
and employer contributions were erroneously transmitted to the association, but should have been
transmitted to another Minnesota public pension plan, the executive director shall transfer the
erroneous employee deductions and employer contributions to the appropriate retirement fund or
individual account, as applicable, without interest. The time limitations specified in subdivisions 7
and 12 do not apply.
(b) For purposes of this subdivision, a Minnesota public pension plan means a plan specified
in section 356.30, subdivision 3, or the plans governed by chapters 353D and 354B.
(c) A potential transfer under paragraph (a) that is reasonably determined to cause the plan
to fail to be a qualified plan under section 401(a) of the federal Internal Revenue Code, as
amended, must not be made by the executive director of the association. Within 30 days after
being notified by the Public Employees Retirement Association of an unmade potential transfer
under this paragraph, the employer of the affected person must transmit an amount representing
the applicable salary deductions and employer contributions, without interest, to the retirement
fund of the appropriate Minnesota public pension plan, or to the applicable individual account if
the proper coverage is by a defined contribution plan. The association must provide the employing
unit a credit for the amount of the erroneous salary deductions and employer contributions
against future contributions from the employer. If the employing unit receives a credit under this
paragraph, the employing unit is responsible for refunding to the applicable employee any amount
that had been erroneously deducted from the person's salary.
    Subd. 7b. Overpayments to members. In the event of an overpayment to a member, retiree,
beneficiary, or other person, the executive director shall recover the overpayment by suspending
or reducing the payment of a retirement annuity, refund, disability benefit, survivor benefit, or
optional annuity payable to the applicable person or the person's estate, whichever applies, under
this chapter until all outstanding money has been recovered.
    Subd. 8. District court reporters; salary deductions. Deductions from the salary of a
district court reporter in a judicial district consisting of two or more counties shall be made by the
auditor of the county in which the bond and official oath of such district court reporter are filed,
from the portion of salary paid by such county.
    Subd. 9. Fee officers; contributions; obligations of employers. Any appointed or elected
officer of a governmental subdivision who was or is a "public employee" within the meaning of
section 353.01 and was or is a member of the fund and whose salary was or is paid in whole or
in part from revenue derived by fees and assessments, shall pay employee contribution in the
amount, at the time, and in the manner provided in subdivisions 2 and 4. This subdivision shall
not apply to district court reporters. The employer contribution as provided in subdivision 3, and
the additional employer contribution as provided in subdivision 3a, with respect to such service
shall be paid by the governmental subdivision. This subdivision shall have both retroactive and
prospective application as to all such members; and every employing governmental subdivision
is deemed liable, retroactively and prospectively, for all employer and additional employer
contributions for every such member in its employ. Delinquencies under this section shall be
governed in all respects by section 353.28.
    Subd. 10. Employer exclusion reports. The head of a department shall annually furnish
the executive director with an exclusion report listing only those employees in potentially
PERA-eligible positions who were not reported as members of the association and who worked
during the school year for school employees and calendar year for nonschool employees. The
department head must certify the accuracy and completeness of the exclusion report to the
association. The executive director shall prescribe the manner and forms, including standardized
exclusion codes, to be used by a governmental subdivision in preparing and filing exclusion
reports. The executive director shall also check the exclusion report to ascertain whether any
omissions have been made by a department head in the reporting of new public employees for
membership. The executive director may delegate an association employee under section 353.03,
subdivision 3a
, paragraph (b), clause (5), to conduct a field audit to review the payroll records of a
governmental subdivision.
    Subd. 11. Employers; required to furnish requested information. (a) All governmental
subdivisions shall furnish promptly such other information relative to the employment status of
all employees or former employees, including, but not limited to, payroll abstracts pertaining to
all past and present employees, as may be requested by the executive director, including schedules
of salaries applicable to various categories of employment.
(b) In the event payroll abstract records have been lost or destroyed, for whatever reason
or in whatever manner, so that such schedules of salaries cannot be furnished therefrom, the
employing governmental subdivision, in lieu thereof, shall furnish to the association an estimate
of the earnings of any employee or former employee for any period as may be requested by the
executive director. If the association is provided a schedule of estimated earnings, the executive
director is authorized to use the same as a basis for making whatever computations might be
necessary for determining obligations of the employee and employer to the retirement fund. If
estimates are not furnished by the employer at the request of the executive director, the executive
director may estimate the obligations of the employee and employer to the retirement fund based
upon those records that are in its possession.
    Subd. 12. Omitted salary deductions; obligations. (a) In the case of omission of required
deductions from the salary of an employee, the department head or designee shall immediately,
upon discovery, report the employee for membership and deduct the employee deductions under
subdivision 4 during the current pay period or during the pay period immediately following the
discovery of the omission. Payment for the omitted obligations may only be made in accordance
with reporting procedures and methods established by the executive director.
(b) When the entire omission period of an employee does not exceed 60 days, the
governmental subdivision may report and submit payment of the omitted employee deductions
and the omitted employer contributions through the reporting processes under subdivision 4.
(c) When the omission period of an employee exceeds 60 days, the governmental subdivision
shall furnish to the association sufficient data and documentation upon which the obligation
for omitted employee and employer contributions can be calculated. The omitted employee
deductions must be deducted from the employee's subsequent salary payment or payments and
remitted to the association. The employee shall pay omitted employee deductions due for the 60
days prior to the end of the last pay period in the omission period during which salary was earned.
The employer shall pay any remaining omitted employee deductions and any omitted employer
contributions, plus cumulative interest at an annual rate of 8.5 percent compounded annually,
from the date or dates each omitted employee contribution was first payable.
(d) An employer shall not hold an employee liable for omitted employee deductions beyond
the pay period dates under paragraph (c), nor attempt to recover from the employee those
employee deductions paid by the employer on behalf of the employee. Omitted deductions due
under paragraph (c) which are not paid by the employee constitute a liability of the employer
that failed to deduct the omitted deductions from the employee's salary. The employer shall make
payment with interest at an annual rate of 8.5 percent compounded annually. Omitted employee
deductions are no longer due if an employee terminates public service before making payment of
omitted employee deductions to the association, but the employer remains liable to pay omitted
employer contributions plus interest at an annual rate of 8.5 percent compounded annually from
the date the contributions were first payable.
(e) The association may not commence action for the recovery of omitted employee
deductions and employer contributions after the expiration of three calendar years after the
calendar year in which the contributions and deductions were omitted. Except as provided
under paragraph (b), no payment may be made or accepted unless the association has already
commenced action for recovery of omitted deductions. An action for recovery commences on the
date of the mailing of any written correspondence from the association requesting information
from the governmental subdivision upon which to determine whether or not omitted deductions
occurred.
    Subd. 12a. Terminated employees: omitted deductions. A terminated employee who has
a period of employment in which previously omitted employer contributions were made under
subdivision 12 but for whom no, or only partial, omitted employee contributions have been made,
or a member who had prior coverage in the association for which previously omitted employer
contributions were made under subdivision 12 but who terminated service before required
omitted employee deductions could be withheld from salary, may pay the omitted employee
deductions for the period on which omitted employer contributions were previously paid plus
interest at an annual rate of 8.5 percent compounded annually. A terminated employee may
pay the omitted employee deductions plus interest within six months of an initial notification
from the association of eligibility to pay those omitted deductions. If a terminated employee is
reemployed in a position covered under a public pension fund under section 356.30, subdivision
3
, and elects to pay omitted employee deductions, payment must be made no later than six months
after a subsequent termination of public service.
    Subd. 12b. Terminated employees: immediate eligibility. If deductions were omitted
from salary adjustments or final salary of a terminated employee who is immediately eligible to
draw a monthly benefit, the employer shall pay the omitted employer and employer additional
contributions plus interest on both the employer and employee amounts due at an annual rate of
8.5 percent compounded annually. The employee shall pay the employee deductions within six
months of an initial notification from the association of eligibility to pay omitted deductions or the
employee forfeits the right to make the payment.
    Subd. 13. Certain warrants canceled. A warrant payable from the retirement fund
remaining unpaid for a period of six months must be canceled into the retirement fund and not
into the general fund.
    Subd. 14. Treatment of periods before initial coverage date. (a) If an entity is determined to
be a governmental subdivision due to receipt of a written notice of eligibility from the association,
that employer and its employees are subject to the requirements of subdivision 12, effective
retroactively to the date that the executive director of the association determines that the entity
first met the definition of a governmental subdivision, if that date predates the notice of eligibility.
    (b) If the retroactive time period under paragraph (a) exceeds three years, an employee is
authorized to purchase service credit in the applicable Public Employees Retirement Association
plan for the portion of the period in excess of three years, by making payment under section
356.551.
    (c) This subdivision does not apply if the applicable employment under paragraph (a)
included coverage by any public or private defined benefit or defined contribution retirement plan,
other than a volunteer firefighters relief association. If this paragraph applies, an individual is
prohibited from purchasing service credit for any period or periods specified in paragraph (a).
History: 1957 c 935 s 7; 1959 c 650 s 12,37,58; 1961 c 744 s 1; Ex1961 c 50 s 1; 1963 c 641
s 18; 1965 c 714 s 1-3; 1965 c 880 s 3; Ex1967 c 53 s 1-3; 1969 c 267 s 2; 1969 c 940 s 5; 1971 c
106 s 16,17; 1973 c 35 s 55; 1973 c 753 s 27-33; 1974 c 229 s 12,13; 1975 c 102 s 6; 1976 c 329
s 20; 1977 c 429 s 24; 1980 c 607 art 14 s 45 subd 2; 1981 c 180 s 6; 1982 c 404 s 5; 1983 c 73 s
1,2; 1983 c 286 s 7; 1984 c 564 s 21; 1Sp1985 c 7 s 13; 1986 c 444; 1987 c 284 art 5 s 4-6; 1988
c 709 art 5 s 10-15; 1989 c 319 art 3 s 7; art 13 s 30; 1990 c 570 art 11 s 5,6; 1991 c 341 s 8-14;
1992 c 432 art 2 s 6-8; 1992 c 513 art 4 s 40; 1992 c 598 art 2 s 2-4; 1993 c 307 art 4 s 17; 1994 c
508 art 1 s 2; 1994 c 528 art 2 s 8; 1997 c 233 art 1 s 38,39; 1998 c 390 art 9 s 1,2; 1999 c 222 art
2 s 5,6; 2000 c 461 art 3 s 14,15; 1Sp2001 c 10 art 11 s 13-16; 2002 c 392 art 3 s 6,7; 1Sp2005 c 8
art 5 s 1-4; art 10 s 47; 2006 c 212 art 3 s 33; 2006 c 271 art 3 s 16-18,47; 2007 c 134 art 2 s 22
353.271 PARTICIPATION IN MINNESOTA POSTRETIREMENT INVESTMENT FUND.
    Subdivision 1. Authorization. The general employees retirement plan of the Public
Employees Retirement Association, the public employees police and fire retirement plan, and
the local government correctional service retirement plan are authorized to participate in the
Minnesota postretirement investment fund. There is one general participation in the Minnesota
postretirement investment fund for each plan of the Public Employees Retirement Association.
    Subd. 2. Valuation of assets; adjustment of benefits. (a) The required reserves for
retirement annuities payable as provided in this chapter other than those payable from the
various local relief association consolidation accounts, as determined in accordance with the
appropriate mortality table adopted by the board of trustees based on the experience of the fund
as recommended by the actuary retained under section 356.214, and approved under section
356.215, subdivision 18, and using the postretirement interest assumption specified in section
356.215, subdivision 8, must be transferred to the Minnesota postretirement investment fund as of
the last business day of the month in which the retirement annuity begins.
(b) Annuity payments must be adjusted in accordance with the provisions of section 11A.18.
(c) Increases in payments under this section must be made automatically unless the intended
recipient files written notice with the executive director of the Public Employees Retirement
Association requesting that the increase not be made.
History: 1969 c 399 s 1; 1969 c 999 s 4; 1971 c 414 s 9; 1973 c 753 s 34,35; 1980 c 607 art
14 s 45 subd 2; s 46; 1Sp1985 c 7 s 14; 1987 c 259 s 27; 1987 c 296 s 4; 1996 c 305 art 1 s 77;
2002 c 392 art 11 s 52; 1Sp2005 c 8 art 10 s 48
353.272 [Repealed, 1981 c 180 s 18]
353.28 FINANCING OF EMPLOYER CONTRIBUTIONS.
    Subdivision 1. General requirement. Each governmental subdivision shall secure
its employer contributions and its additional employer contributions and shall pay these
contributions to the retirement fund out of moneys collected from taxes or other revenue of the
governmental subdivision, as its obligation for all members employed by such subdivision and
these contributions shall be charged as administrative costs.
    Subd. 2.[Repealed, 1973 c 753 s 85]
    Subd. 3.[Repealed, 1973 c 753 s 85]
    Subd. 4.[Repealed, 1973 c 753 s 85]
    Subd. 5. Interest chargeable on amounts due. Any amount due under this section or
section 353.27, subdivision 4, is payable with interest at an annual compound rate of 8.5 percent
from the date due until the date payment is received by the association, with a minimum interest
charge of $10.
    Subd. 6. Collection of unpaid amounts. (a) If a governmental subdivision which receives
the direct proceeds of property taxation fails to pay an amount due under chapter 353, 353A,
353B, 353C, or 353D, the executive director shall certify the amount to the governmental
subdivision for payment. If the governmental subdivision fails to remit the sum so due in a
timely fashion, the executive director shall certify the amount to the applicable county auditor for
collection. The county auditor shall collect the amount out of the revenue of the governmental
subdivision, or shall add the amount to the levy of the governmental subdivision and make
payment directly to the association. This tax must be levied, collected, and apportioned in the
manner that other taxes are levied, collected, and apportioned.
    (b) If a governmental subdivision which is not funded directly from the proceeds of property
taxation fails to pay an amount due under this chapter, the executive director shall certify the
amount to the governmental subdivision for payment. If the governmental subdivision fails to
pay the amount for a period of 60 days after the date of the certification, the executive director
shall certify the amount to the commissioner of finance, who shall deduct the amount from any
subsequent state-aid payment or state appropriation amount applicable to the governmental
subdivision and make payment directly to the association. If the amount of the state-aid payment
or state appropriation is not sufficient to pay the full sum due, the amounts paid to the association
must be applied first to the unpaid employee deductions withheld from the employees' wages and
next to the unpaid employer contributions. Any remaining amount received by the association
must be applied to the interest due on the employee and employer contribution amounts. If a
governmental subdivision under this paragraph owes amounts to more than one public retirement
plan, section 356.98 applies.
    (c) If a governmental subdivision has been dissolved or closed, the requirements in paragraph
(b) of a certification to the governmental subdivision and the related 60-day waiting period do not
apply. The executive director is authorized to immediately certify the applicable amount to the
commissioner of finance.
    Subd. 7.[Repealed, 1973 c 753 s 85]
    Subd. 8. Excess levy authority. If the taxes authorized to be levied under this section cause
the total amount of taxes levied to exceed any limitation upon the power of a county, city, town, or
school district to levy taxes, the governmental subdivision concerned, if it is other than a school
district, may levy taxes in excess of the limitation in such amount as is necessary to meet its
obligations under this section. The expenditures authorized to be made under this chapter by any
municipality are not included in computing the cost of government as defined in any home rule
charter of any municipality which employs members covered by the retirement fund.
    Subd. 9.[Repealed, 1973 c 753 s 85]
    Subd. 10.[Repealed, 1973 c 753 s 85]
    Subd. 11.[Repealed, 1971 c 106 s 40]
History: 1957 c 935 s 8; 1959 c 650 s 45,46,58; 1961 c 744 s 2; Ex1961 c 50 s 2; Ex1967 c
59 s 1; 1969 c 267 s 3; 1971 c 106 s 18; Ex1971 c 31 art 20 s 11; 1973 c 123 art 5 s 7; 1973 c
753 s 37,38; 1975 c 102 s 6; 1981 c 180 s 7; 1981 c 224 s 81,82; 1983 c 73 s 3; 1987 c 284 art
5 s 7; 1989 c 319 art 3 s 8,9; 1991 c 341 s 15; 1992 c 598 art 2 s 5; 1Sp2005 c 8 art 5 s 5,6;
2006 c 271 art 3 s 19; 2007 c 134 art 2 s 23
353.29 RETIREMENT ANNUITY UPON TERMINATION OF MEMBERSHIP.
    Subdivision 1. Age and allowable service requirements. Upon termination of membership,
a person who has attained normal retirement age and who received credit for not less than three
years of allowable service is entitled upon application to a retirement annuity. The retirement
annuity is known as the "normal" retirement annuity.
    Subd. 2.[Repealed, 1Sp2005 c 8 art 1 s 32]
    Subd. 3. Retirement annuity formula. (a) This paragraph, in conjunction with section
353.30, subdivisions 1a, 1b, and 1c, applies to any member who first became a public employee
or a member of a pension fund listed in section 356.30, subdivision 3, before July 1, 1989, unless
paragraph (b), in conjunction with section 353.30, subdivision 5, produces a higher annuity
amount, in which case paragraph (b) will apply. The average salary as defined in section 353.01,
subdivision 17a
, multiplied by the percent specified in section 356.315, subdivision 3, for each
year of allowable service for the first ten years and thereafter by the percent specified in section
356.315, subdivision 4, per year of allowable service and completed months less than a full year
for a basic member, and the percent specified in section 356.315, subdivision 1, for each year of
allowable service for the first ten years and thereafter by the percent specified in section 356.315,
subdivision 2
, per year of allowable service and completed months less than a full year for a
coordinated member shall determine the amount of the normal retirement annuity.
    (b) This paragraph applies to a member who has become at least 55 years old and first
became a public employee after June 30, 1989, and to any other member whose annuity amount,
when calculated under this paragraph and in conjunction with section 353.30, subdivision 5,
is higher than it is when calculated under paragraph (a), in conjunction with section 353.30,
subdivisions 1a, 1b, and 1c
. The average salary, as defined in section 353.01, subdivision 17a,
multiplied by the percent specified in section 356.315, subdivision 4, for each year of allowable
service and completed months less than a full year for a basic member and the percent specified in
section 356.315, subdivision 2, per year of allowable service and completed months less than a
full year for a coordinated member, shall determine the amount of the normal retirement annuity.
    Subd. 4. Application for annuity. Application for a retirement annuity may be made by
a member or by a person authorized to act on behalf of the member. Every application for
retirement must be made in writing on a form prescribed by the executive director and must
be substantiated by written proof of the member's age and identity. The notarized signature of
a member's spouse on a retirement annuity application acknowledging the member's annuity
selection meets the notice requirement to the spouse under section 356.46, subdivision 3. An
application for a retirement annuity is not complete until all necessary supporting documents are
received by the executive director.
    Subd. 5.[Repealed, 1959 c 650 s 57]
    Subd. 6. Retirement before eligibility for Social Security benefits. A member or former
member who retires before becoming eligible for Social Security retirement benefits may elect to
receive an optional retirement annuity from the association that provides for different annuity
amounts over different periods of retirement. The election of this optional retirement annuity must
be exercised by making application to the board of trustees. The optional annuity must take
the form of an annuity payable for the period before the annuitant becomes eligible for Social
Security old age retirement benefits in a greater amount than the amount of the annuity calculated
under subdivisions 2 and 3 on the basis of the age of the annuitant at retirement. The optional
annuity must be the actuarial equivalent of the normal retirement annuity computed on the basis
of age at retirement. This greater amount must be paid until the annuitant reaches age 62, at which
time the payment from the association must be reduced. The board of trustees shall establish the
method of computing the optional retirement annuity under this subdivision. In establishing the
method of computing the optional retirement annuity, the board of trustees shall obtain the written
approval of the actuary retained under section 356.214. The recommendations must be a part of
the permanent records of the board of trustees.
    Subd. 7. Annuities; accrual. Except as to elected public officials, a retirement annuity
granted under this chapter begins with the first day of the first calendar month after the date of
termination of public service. The annuity must be paid in equal monthly installments and does
not accrue beyond the end of the month in which entitlement to the annuity has terminated. If the
annuitant dies prior to negotiating the check for the month in which death occurs, payment must
be made to the surviving spouse, or if none, to the designated beneficiary, or if none, to the estate.
An annuity granted to an elective public official accrues on the day following expiration
of public office or expiration of the right to hold that office. The annuity for the month during
which the expiration occurred is prorated accordingly. An annuity, once granted, must not be
increased, decreased, or revoked except under this chapter. An annuity payment may be made
retroactive for up to one year prior to that month in which a complete application is received by
the executive director under subdivision 4.
    Subd. 8. Annuities; payment. Payment of any annuity or benefit for a given month must be
mailed by the association to the annuitant, recipient of a disability benefit, or survivor, or must be
automatically deposited under section 356.401, subdivision 2, during the first week of that month.
The board may contract for professional services to identify deceased annuitants and benefit
recipients through a review of nationally maintained death records.
History: 1957 c 935 s 9; 1959 c 650 s 13-16; 1963 c 639 s 1; 1965 c 714 s 4; 1965 c 880 s 4;
Ex1967 c 53 s 4; 1971 c 106 s 19-21; 1973 c 753 s 39-42; 1974 c 229 s 14; 1975 c 102 s 6,11,12;
1976 c 329 s 21; 1977 c 429 s 25,26; 1978 c 471 s 2,3; 1979 c 216 s 8,9; 1981 c 180 s 8; 1981 c
224 s 83; 1983 c 73 s 4,5; 1986 c 444; 1987 c 259 s 28; 1987 c 284 art 5 s 8; 1987 c 372 art 9 s
10,11; 1988 c 709 art 5 s 16; 1989 c 319 art 3 s 10,11; art 13 s 31-33; 1990 c 570 art 12 s 20;
1991 c 341 s 16; 1992 c 432 art 2 s 9; 1993 c 307 art 4 s 18; 1997 c 233 art 1 s 40; 2002 c 392 art
11 s 52; 1Sp2005 c 8 art 1 s 11; 2006 c 271 art 3 s 20,47; 2007 c 134 art 2 s 24
353.30 ANNUITIES UPON RETIREMENT.
    Subdivision 1.[Repealed, 2007 c 134 art 2 s 50]
    Subd. 1a. Pre-July 1, 1989 members: rule of 90. Upon termination of public service under
section 353.01, subdivision 11a, 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, and whose attained age
plus credited allowable service totals 90 years is entitled upon application to a retirement annuity
in an amount equal to the normal annuity provided in section 353.29, subdivision 3, paragraph
(a), without any reduction in annuity due to early retirement.
    Subd. 1b. Pre-July 1, 1989 members: 30 years of service. Upon termination of public
service under section 353.01, subdivision 11a, 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, with 30
years or more of allowable service credit, who elects to retire prior to normal retirement age, shall
receive an annuity in an amount equal to the normal annuity provided under section 353.29,
subdivision 3
, paragraph (a), reduced by one-quarter of one percent for each month that the
member is under age 62 at the time of retirement.
    Subd. 1c. Pre-July 1, 1989 members: early retirement. Upon termination of public service,
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, who has become at least 55 years old but not normal
retirement age, and has received credit for at least three years of allowable service is entitled upon
application to a retirement annuity in an amount equal to the normal annuity provided in section
353.29, subdivision 3, paragraph (a), reduced by one-quarter of one percent for each month that
the member is under normal retirement age at the time of retirement.
    Subd. 2.[Repealed, 1971 c 106 s 40]
    Subd. 3. Optional retirement annuity forms. The board of trustees shall establish optional
annuities which shall take the form of a joint and survivor annuity. Except as provided in
subdivision 3a, the optional annuity forms shall be actuarially equivalent to the forms provided in
section 353.29 and subdivisions 1, 1a, 1b, 1c, and 5. In establishing those optional forms, the
board shall obtain the written recommendation of the actuary retained under section 356.214.
The recommendations shall be a part of the permanent records of the board. A member or former
member may select an optional form of annuity in lieu of accepting any other form of annuity
which might otherwise be available.
    Subd. 3a. Bounce-back annuity. (a) If a former member or disabilitant selects a joint and
survivor annuity option under subdivision 3 after June 30, 1989, the former member or disabilitant
must receive a normal single life annuity if the designated optional annuity beneficiary dies before
the former member or disabilitant. Under this option, no reduction may be made in the person's
annuity to provide for restoration of the normal single life annuity in the event of the death of
the designated optional annuity beneficiary.
(b) The annuity adjustment specified in paragraph (a) also applies to joint and survivor
annuity options under subdivision 3 elected before July 1, 1989. The annuity adjustment under
this paragraph occurs on July 1, 1989, or on the first day of the first month following the death
of the designated optional annuity beneficiary, whichever is later. This paragraph may not be
interpreted as authorizing retroactive payments.
    Subd. 3b. Bounce-back annuity. (a) The board of trustees must provide a joint and survivor
annuity option to members of the police and fire fund. If a joint and survivor annuity is elected on
or after July 1, 1989, the former member or disabilitant must receive a normal single life annuity if
the designated optional annuity beneficiary dies before the former member or disabilitant. Under
this option, no reduction may be made in the person's annuity to provide for restoration of the
normal single life annuity in the event of the death of the designated optional annuity beneficiary.
(b) The annuity adjustment specified in paragraph (a) also applies to joint and survivor
annuity options under subdivision 3 elected before July 1, 1989. The annuity adjustment under
this paragraph occurs on July 1, 1989, or on the first day of the first month following the death
of the designated optional annuity beneficiary, whichever is later. This paragraph may not be
interpreted as authorizing retroactive payments.
    Subd. 3c. Effective date of bounce-back annuity. In the event of the death of the designated
optional annuity beneficiary before the retired employee or disabilitant, the restoration of the
normal single life annuity under subdivision 3a or 3b will take effect on the first of the month
following the date of death of the designated optional annuity beneficiary or on the first of the
month following one year before the date on which a certified copy of the death record is received
in the office of the public employees retirement association, whichever date is later.
    Subd. 4. Reduction in monthly payments. Monthly payments to which any person may
be entitled under this chapter may be reduced upon application to the association, provided that
the person shall first relinquish in writing all claim to that part of the full monthly payment
which is the difference between the monthly payment which that person would be otherwise
entitled to receive and the monthly payment which that person will receive. The reduced monthly
payment shall be payment in full of all amounts due under this chapter for the month for which
the payment is made and acceptance of the reduced monthly payment releases the retirement
association from all obligation to pay to the person the difference between the amount of the
reduced monthly payment and the full amount of the monthly payment which the person would
otherwise have received. Upon application of the person who is entitled to such monthly payment,
it may be increased prospectively to not more than the amount to which the person would have
been entitled had no portion thereof been waived.
    Subd. 5. Actuarial reduction for early retirement. This subdivision applies to a member
who has become at least 55 years old and first became a public employee after June 30, 1989, and
to any other member who has become at least 55 years old and whose annuity is higher when
calculated under section 353.29, subdivision 3, paragraph (b), in conjunction with this subdivision
than when calculated under section 353.29, subdivision 3, paragraph (a), in conjunction with
subdivision 1, 1a, 1b, or 1c. An employee who retires before normal retirement age shall be
paid the retirement annuity provided in section 353.29, subdivision 3, paragraph (b), reduced so
that the reduced annuity is the actuarial equivalent of the annuity that would be payable to the
employee if the employee deferred receipt of the annuity and the annuity amount were augmented
at an annual rate of three percent compounded annually from the day the annuity begins to accrue
until the normal retirement age if the employee became an employee before July 1, 2006, and
at 2.5 percent compounded annually from the day the annuity begins to accrue until the normal
retirement age if the employee initially becomes an employee after June 30, 2006.
History: 1957 c 935 s 10; 1959 c 650 s 17,18,58; 1971 c 106 s 22; 1973 c 753 s 43-45;
1976 c 329 s 22; 1978 c 796 s 29-31; 1981 c 224 s 84; 1982 c 519 s 1-3; 1983 c 286 s 8; 1984 c
564 s 22; 1986 c 444; 1987 c 259 s 29; 1987 c 372 art 9 s 12; 1989 c 319 art 13 s 34; art 17 s
11; 1990 c 570 art 12 s 21; 1Sp2001 c 9 art 15 s 32; 2006 c 271 art 3 s 21,22,47; 2006 c 277
art 2 s 4; 2007 c 134 art 2 s 25-27
353.31 SURVIVOR BENEFITS.
    Subdivision 1. Benefits for surviving spouse and dependent children; before retirement.
Upon the death of a basic member before retirement or upon the death of a basic member who
was disabled and receiving disability benefits under section 353.33 at the time of death who has
had at least 18 months of credited allowable service, the surviving spouse and dependent child
or children of the member, as defined in section 353.01, subdivisions 15 and 20, are entitled to
receive the monthly benefit provided below:
(a) Surviving spouse
50 percent of the member's monthly average
salary in effect over the last full six months of
allowable service preceding the month in which
death occurred
(b) Each dependent child
10 percent of the member's monthly average
salary in effect over the last full six months of
allowable service preceding the month in which
death occurred
Notwithstanding the definition of surviving spouse under section 353.01, subdivision 20, a former
spouse of the member, if any, is entitled to a portion of the monthly surviving spouse benefit if
stipulated under the terms of a marriage dissolution decree that is filed with the association. If
there is no surviving spouse or child or children, a former spouse may be entitled to a lump-sum
refund payment under section 353.32, subdivision 1, if provided for in a marriage dissolution
decree but not a monthly surviving spouse benefit even if required by the decree.
    Subd. 1a. Maximum family benefit. Payments for the benefit of a dependent child or
children, as defined in section 353.01, subdivision 15, must be made to the surviving parent, or to
the legal guardian of the child. The maximum monthly benefit for a family must not exceed an
amount equal to 70 percent of the member's specified average monthly salary, and the minimum
benefit for a family including a 100 percent joint and survivor annuity under subdivision 1b, must
not be less than 50 percent of the basic member's specified average monthly salary.
    Subd. 1b. Joint and survivor option. (a) Prior to payment of a surviving spouse benefit
under subdivision 1, the surviving spouse may elect to receive the 100 percent joint and survivor
optional annuity under section 353.32, subdivision 1a, rather than a surviving spouse benefit.
(b) If there is a dependent child or children, and the 100 percent joint and survivor
optional annuity for the surviving spouse, when added to the dependent children's benefit under
subdivisions 1 and 1a, exceeds an amount equal to 70 percent of the member's specified average
monthly salary, the 100 percent joint and survivor annuity under section 353.32, subdivision 1a,
must be reduced by the amount necessary so that the total family benefit does not exceed the 70
percent maximum family benefit amount under subdivision 1a.
(c) The 100 percent joint and survivor optional annuity must be restored to the surviving
spouse, plus applicable postretirement fund adjustments under section 356.41, as the dependent
child or children become no longer dependent under section 353.01, subdivision 15.
    Subd. 1c. Coordinated members. Except for benefits provided under section 353.32,
no survivor benefits are payable to the surviving spouse or dependent children of a deceased
coordinated member.
    Subd. 2.[Repealed, 1973 c 753 s 85]
    Subd. 3.[Repealed, 1973 c 753 s 85]
    Subd. 4.[Repealed, 1973 c 753 s 85]
    Subd. 5.[Repealed, 1973 c 753 s 85]
    Subd. 6.[Repealed, 1973 c 753 s 85]
    Subd. 7.[Repealed, 1973 c 753 s 85]
    Subd. 8. Accrual of benefits. All benefits under this section and survivor benefits otherwise
provided in this chapter when payable to persons qualifying therefor shall accrue on the first day
following the death of a "basic member" or the first day of the month following the death of an
annuitant or disabilitant. No payment may be made retroactively for more than 12 months prior to
that month in which the application is filed, and no benefit shall accrue beyond the end of the
month in which entitlement to such benefits has terminated.
    Subd. 9. Application for benefits. Every claim or demand for a survivor benefit or spouse's
annuity shall be initiated by written application in the manner and form prescribed by the
executive director, filed in the office of the retirement association, showing compliance with the
statutory conditions qualifying the applicant for such survivor benefit or spouse's annuity.
    Subd. 10.[Repealed, 1973 c 753 s 85]
    Subd. 11.[Repealed, 1977 c 429 s 65]
History: 1957 c 935 s 11; 1959 c 646 s 1; 1959 c 650 s 19,20,47; 1959 c 651 s 1; 1961 c
467 s 1-4; Ex1961 c 79 s 1; 1963 c 641 s 19-21; 1965 c 880 s 5; Ex1967 c 26 s 2; 1969 c 858 s
1; 1969 c 940 s 6; 1971 c 106 s 23-25; 1973 c 753 s 46,47; 1974 c 229 s 15; 1975 c 102 s 13;
1977 c 429 s 27; 1978 c 471 s 4; 1978 c 796 s 32; 1979 c 216 s 10; 1981 c 180 s 9; 1981 c 224 s
85,86; 1982 c 578 art 1 s 4; 1984 c 564 s 23; 1991 c 269 art 2 s 6; 1991 c 341 s 17; 1992 c 432
art 2 s 10; 1Sp2005 c 8 art 10 s 49
353.32 REFUNDS AFTER DEATH OF MEMBER OR FORMER MEMBER.
    Subdivision 1. Before retirement. If a member or former member who terminated public
service dies before retirement or before receiving any retirement annuity and no other payment
of any kind is or may become payable to any person, a refund shall be paid to the designated
beneficiary or, if there be none, to the surviving spouse, or, if none, to the legal representative
of the decedent's estate. Such refund shall be in an amount equal to accumulated deductions
plus interest thereon at the rate of six percent per annum compounded annually less the sum
of any disability or survivor benefits, if any, that may have been paid by the fund; provided
that a survivor who has a right to benefits pursuant to section 353.31 may waive such benefits
in writing, except such benefits for a dependent child under the age of 18 years may only be
waived pursuant to an order of the district court.
    Subd. 1a. Surviving spouse optional annuity. (a) If a member or former member who
has credit for not less than three years of allowable service and dies before the annuity or
disability benefit begins to accrue under section 353.29, subdivision 7, or 353.33, subdivision 2,
notwithstanding any designation of beneficiary to the contrary, the surviving spouse may elect
to receive, instead of a refund with interest under subdivision 1, or surviving spouse benefits
otherwise payable under section 353.31, an annuity equal to a 100 percent joint and survivor
annuity computed consistent with section 353.30, subdivision 1a, 1c, or 5, whichever is applicable.
    (b) If a member first became a public employee or a member of a pension fund listed in
section 356.30, subdivision 3, before July 1, 1989, and has credit for at least 30 years of allowable
service on the date of death, the surviving spouse may elect to receive a 100 percent joint and
survivor annuity computed using section 353.30, subdivision 1b, except that the early retirement
reduction under that provision will be applied from age 62 back to age 55 and one-half of the
early retirement reduction from age 55 back to the age payment begins.
    (c) If a member who was under age 55 and has credit for at least three years of allowable
service dies, but did not qualify for retirement on the date of death, the surviving spouse may elect
to receive a 100 percent joint and survivor annuity computed using section 353.30, subdivision
1c
or 5, as applicable, except that the early retirement reduction specified in the applicable
subdivision will be applied to age 55 and one-half of the early retirement reduction from age
55 back to the age payment begins.
    (d) Notwithstanding the definition of surviving spouse in section 353.01, subdivision 20,
a former spouse of the member, if any, is entitled to a portion of the monthly surviving spouse
optional annuity if stipulated under the terms of a marriage dissolution decree filed with the
association. If there is no surviving spouse or child or children, a former spouse may be entitled
to a lump-sum refund payment under subdivision 1, if provided for in a marriage dissolution
decree, but not a monthly surviving spouse optional annuity, despite the terms of a marriage
dissolution decree filed with the association.
    (e) The surviving spouse eligible for surviving spouse benefits under paragraph (a) may
apply for the annuity at any time after the date on which the deceased employee would have
attained the required age for retirement based on the employee's allowable service. The surviving
spouse eligible for surviving spouse benefits under paragraph (b) or (c) may apply for an annuity
any time after the member's death.
    (f) Sections 353.34, subdivision 3, and 353.71, subdivision 2, apply to a deferred annuity or
surviving spouse benefit payable under this subdivision.
    (g) An amount equal to any excess of the accumulated contributions that were credited to the
account of the deceased employee over and above the total of the annuities paid and payable to
the surviving spouse must be paid to the surviving spouse's estate.
    (h) A member may specify in writing that this subdivision does not apply and that payment
may be made only to the designated beneficiary as otherwise provided by this chapter. The
waiver of a surviving spouse annuity under this section does not make a dependent child eligible
for benefits under subdivision 1c.
    (i) If the deceased member or former member first became a public employee or a member
of a public pension plan listed in section 356.30, subdivision 3, on or after July 1, 1989, a survivor
annuity computed under paragraph (a) or (c) must be computed as specified in section 353.30,
subdivision 5
, except for the revised early retirement reduction specified in paragraph (c), if
paragraph (c) is the applicable provision.
    (j) For any survivor annuity determined under this subdivision, the payment is to be based on
the total allowable service that the member had accrued as of the date of death and the age of the
member and surviving spouse on that date.
    Subd. 1b. Survivor coverage term certain. (a) In lieu of the 100 percent optional annuity
under subdivision 1a, or a refund under subdivision 1, the surviving spouse of a deceased member
may elect to receive survivor coverage for a term certain period of ten, 15, or 20 years, but
monthly payments must not exceed 75 percent of the average high-five monthly salary of the
deceased member. The benefit terminates at the end of the specified term certain period. Except
as otherwise specified in this subdivision, the monthly term certain annuity must be actuarially
equivalent to the 100 percent optional annuity under subdivision 1a.
    (b) If a surviving spouse elects a term certain annuity and dies before the expiration of the
specified term certain period, the commuted value of the remaining annuity payments must be
paid in a lump sum to the survivor's estate.
    Subd. 1c. Dependent child survivor coverage. If there is no surviving spouse eligible
for benefits under subdivision 1a, a dependent child or children as defined in section 353.01,
subdivision 15a
, is eligible for monthly payments. Payments to a dependent child must be paid
from the date of the member's death to the date the dependent child attains age 20 if the child is
under age 15. If the child is 15 years or older on the date of death, payment must be made for five
years. The payment to a dependent child is an amount actuarially equivalent to the value of a
100 percent optional annuity under subdivision 1a using the age of the member and age of the
dependent child at the date of death in lieu of the age of the surviving spouse. If there is more than
one dependent child, each dependent child shall receive a proportionate share of the actuarial
value of the employee's account.
    Subd. 2. After retirement. If a former member dies after retirement and no payment of any
kind is or may become payable to any person, including any deferred benefit or annuity, there
shall be paid to the same succession of payees set forth in subdivision 1, a refund of accumulated
deductions, less the total payments of all kinds made by the fund to the former member during the
former member's lifetime or to any authorized person after death, without interest.
    Subd. 3. Optional survivor annuities; designated beneficiary. If a former member selected
an optional annuity by the terms of which an optional survivor's annuity was paid to a survivor
after the former member's death, upon the death of the survivor there shall be paid to the former
member's designated beneficiary a refund of accumulated deductions less the total payments of
all kinds made by the fund to the former member during the former member's lifetime or to any
authorized person after death. If said beneficiary should die before making application for such
refund, the same shall be paid to the legal representative of the estate of the former member.
    Subd. 4. Lack, or death, of beneficiary. If a member or former member dies without having
designated a beneficiary or if the beneficiary should die before making application for refund, and
if there is no surviving spouse, and if the legal representative of such member or former member
does not apply for refund within five years from the date of death of the member or former
member, the accumulated deductions to the member or former member's credit at the time of
death shall be disposed of in the manner provided in section 353.34, subdivision 6.
    Subd. 5. $1,500 or less, limited. If a member or former member dies without having
designated a beneficiary, or if the beneficiary should die before making application for refund of
the sum to the credit of such decedent, and the amount of the refund is $1,500 or less, the board of
trustees may 90 days after the date of death, in the absence of probate proceedings, make payment
to the surviving spouse of the decedent or, if none, to the decedent's personal representative or, if
none, to the estate. A payment under this subdivision is a bar to recovery by any other person or
persons. A retirement annuity or disability or survivor benefit that has accrued at the time of death
of an annuitant, disabilitant, or survivor may be paid in the same manner.
    Subd. 6.[Repealed, 1963 c 641 s 38]
    Subd. 7.[Repealed, 1978 c 796 s 46]
    Subd. 8.[Repealed, 1971 c 106 s 40]
    Subd. 9. Payment to a minor. If a member or former member dies having named as
beneficiary a person who is a minor at the time of the application for refund, the board may
make the payment (1) directly to the minor, (2) to a person who has legally qualified and is
acting as guardian of the minor's person or property in any jurisdiction, or (3) to either parent
of the minor or to an adult person with whom the minor may at the time be living. The parent
or other person to whom any amount is to be paid must advise the board in writing that the
amount will be held or used in trust for the benefit of such minor. Any annuity or disability
benefit payable at the time of death of an annuitant or recipient of a disability benefit, which is
payable to a beneficiary who is a minor, may be paid in the same manner. The payment is a bar
to recovery by any other person or persons.
History: 1957 c 935 s 12; 1959 c 646 s 2; 1959 c 650 s 42,48,58; 1963 c 641 s 22-24; 1969
c 940 s 7-9; 1971 c 106 s 26-28; 1973 c 35 s 56; 1973 c 753 s 48-52; 1974 c 229 s 16,17; 1975 c
102 s 14; 1977 c 429 s 28; 1978 c 471 s 5; 1978 c 796 s 33,34; 1979 c 216 s 11-13; 1981 c 180
s 10; 1981 c 224 s 87; 1983 c 73 s 6; 1984 c 564 s 24,25; 1986 c 444; 1986 c 458 s 12; 1987
c 372 art 9 s 13; 1988 c 709 art 5 s 17,18; 1989 c 319 art 13 s 35,36; 1991 c 341 s 18; 1992 c
432 art 2 s 11; 1993 c 307 art 6 s 2; 1993 c 336 art 6 s 7-9; 1Sp2005 c 8 art 10 s 50; 2006 c
271 art 3 s 23,24; 2007 c 134 art 2 s 28,29
353.33 TOTAL AND PERMANENT DISABILITY BENEFITS.
    Subdivision 1. Age, service, and salary requirements. A coordinated member who has
at least three years of allowable service and becomes totally and permanently disabled before
normal retirement age, and a basic member who has at least three years of allowable service
and who becomes totally and permanently disabled, upon application as defined under section
353.031, is entitled to a disability benefit in an amount determined under subdivision 3. If the
disabled person's public service has terminated at any time, at least two of the required three years
of allowable service must have been rendered after last becoming an active member.
    Subd. 2. Accrual of benefits. (a) This benefit begins to accrue when the applicant is no
longer receiving any form of compensation, whether salary or paid leave; 90 days preceding the
filing of the application, or, if annual or sick leave or any other employer-paid salary continuation
plan is paid for more than the 90-day period, from the date salary ceased, whichever is later. No
member is entitled to receive a disability benefit payment when there remains to the member's
credit any unused annual leave, sick leave, or any other employer-paid salary continuation
plan, or under any other circumstances when, during the period of disability, there has been no
impairment of the person's salary.
    (b) Payment must not accrue beyond the end of the month in which entitlement has
terminated. If the disabilitant dies prior to negotiating the check for the month in which death
occurs, payment is made to the surviving spouse, or if none, to the designated beneficiary, or
if none, to the estate.
    Subd. 3. Computation of benefits. This disability benefit is an amount equal to the normal
annuity payable to a member who has reached normal retirement age with the same number of
years of allowable service and the same average salary, as provided in section 353.01, subdivision
17a
, and section 353.29, subdivision 3.
A basic member shall receive a supplementary monthly benefit of $25 to age 65 or the
five-year anniversary of the effective date of the disability benefit, whichever is later.
If the disability benefits under this subdivision exceed the average salary as defined in
section 353.01, subdivision 17a, the disability benefits must be reduced to an amount equal
to the average salary.
    Subd. 3a.[Repealed, 1999 c 222 art 2 s 20]
    Subd. 3b. Optional annuity election. A disabled member may elect to receive the normal
disability benefit or an optional annuity under section 353.30, subdivision 3. The election of an
optional annuity must be made prior to the commencement of payment of the disability benefit.
The optional annuity must begin to accrue on the same date as provided for the disability benefit.
(1) If a person who is not the spouse of a member is named as beneficiary of the joint and
survivor optional annuity, the person is eligible to receive the annuity only if the spouse, on the
disability application form prescribed by the executive director, permanently waives the surviving
spouse benefits under sections 353.31, subdivision 1, and 353.32, subdivision 1a. If the spouse of
the member refuses to permanently waive the surviving spouse coverage, the selection of a person
other than the spouse of the member as a joint annuitant is invalid.
(2) If the spouse of the member permanently waives survivor coverage, the dependent
children, if any, continue to be eligible for survivor benefits under section 353.31, subdivision 1,
including the minimum benefit in section 353.31, subdivision 1a. The designated optional annuity
beneficiary may draw the monthly benefit; however, the amount payable to the dependent child
or children and joint annuitant must not exceed the 70 percent maximum family benefit under
section 353.31, subdivision 1a. If the maximum is exceeded, the benefit of the joint annuitant
must be reduced to the amount necessary so that the total family benefit does not exceed the
70 percent maximum family benefit amount.
(3) If the spouse is named as the beneficiary of the joint and survivor optional annuity, the
spouse may draw the monthly benefits; however, the amount payable to the dependent child or
children and the joint annuitant must not exceed the 70 percent maximum family benefit under
section 353.31, subdivision 1a. If the maximum is exceeded, each dependent child will receive ten
percent of the member's specified average monthly salary, and the benefit to the joint annuitant
must be reduced to the amount necessary so that the total family benefit does not exceed the 70
percent maximum family benefit amount. The joint and survivor optional annuity must be restored
to the surviving spouse, plus applicable postretirement adjustments under section 356.41, as the
dependent child or children become no longer dependent under section 353.01, subdivision 15.
    Subd. 4. Procedure to determine eligibility. (a) Eligibility for disability benefits must be
determined following the procedures defined in section 353.031.
    (b) If, after following the procedures for determining eligibility for benefits under section
353.031, and upon consideration of the medical evidence received and the recommendations
of the medical adviser, it is determined by the executive director that the applicant is totally
and permanently disabled within the meaning of the law, the association shall grant the person
a disability benefit.
    Subd. 5. Benefits paid under workers' compensation law. Disability benefits paid shall
be coordinated with any amounts received or receivable under workers' compensation law, such
as temporary total, permanent total, temporary partial, permanent partial, or economic recovery
compensation benefits, in either periodic or lump sum payments from the employer under
applicable workers' compensation laws, after deduction of amount of attorney fees, authorized
under applicable workers' compensation laws, paid by a disabilitant. If the total of the single life
annuity actuarial equivalent disability benefit and the workers' compensation benefit exceeds: (1)
the salary the disabled member received as of the date of the disability or (2) the salary currently
payable for the same employment position or an employment position substantially similar to the
one the person held as of the date of the disability, whichever is greater, the disability benefit must
be reduced to that amount which, when added to the workers' compensation benefits, does not
exceed the greater of the salaries described in clauses (1) and (2).
    Subd. 5a.[Repealed, 1991 c 341 s 51]
    Subd. 5b.[Repealed, 2004 c 267 art 8 s 41]
    Subd. 6. Continuing eligibility for benefits. Disability benefits are contingent upon a
disabled person's participation in a vocational rehabilitation evaluation if the executive director
determines that the disabled person may be able to return to a gainful occupation. If, after a
review by the executive director under section 353.031, subdivision 8, a member is found to be no
longer totally and permanently disabled, payments must cease the first of the month following the
expiration of a 30-day period after the member receives a certified letter notifying the member
that payments will cease.
    Subd. 6a.[Repealed, 2007 c 134 art 4 s 36]
    Subd. 6b.[Repealed, 2007 c 134 art 4 s 36]
    Subd. 7. Partial reemployment. If, following a work or non-work-related injury or illness,
a disabled person who remains totally and permanently disabled as defined in section 353.01,
subdivision 19
, has income from employment that is not substantial gainful activity and the
rate of earnings from that employment are less than the salary rate at the date of disability
or the salary rate currently paid for positions similar to the employment position held by the
disabled person immediately before becoming disabled, whichever is greater, the executive
director shall continue the disability benefit in an amount that, when added to the earnings and
any workers' compensation benefit, does not exceed the salary rate at the date of disability or
the salary currently paid for positions similar to the employment position held by the disabled
person immediately before becoming disabled, whichever is higher. The disability benefit under
this subdivision may not exceed the disability benefit originally allowed, plus any postretirement
adjustments payable after December 31, 1988, in accordance with section 11A.18, subdivision 10.
No deductions for the retirement fund may be taken from the salary of a disabled person who is
receiving a disability benefit as provided in this subdivision.
    Subd. 7a. Trial work period. (a) This subdivision applies only to the Public Employees
Retirement Association general employees retirement plan.
    (b) If, following a work or non-work-related injury or illness, a disabled member attempts
to return to work for their previous public employer or attempts to return to a similar position
with another public employer, on a full-time or less than full-time basis, the Public Employees
Retirement Association shall continue paying the disability benefit for a period not to exceed six
months. The disability benefit must continue in an amount that, when added to the subsequent
employment earnings and workers' compensation benefit, does not exceed the salary at the date of
disability or the salary currently paid for similar positions, whichever is higher.
    (c) No deductions for the general employees retirement plan may be taken from the salary of
a disabled person who is attempting to return to work under this provision unless the member
waives further disability benefits.
    (d) A member only may return to employment and continue disability benefit payments once
while receiving disability benefits from the general employees retirement plan administered by
the Public Employees Retirement Association.
    Subd. 8.[Repealed, 2007 c 134 art 4 s 36]
    Subd. 9. Return to employment. (a) Any person receiving a disability benefit under this
section who is restored to employment not covered by subdivision 7 or 7a must have the disability
benefit discontinued on the first day of the month following the return to employment.
(b) If the person is employed by a governmental subdivision as defined under section 353.01,
subdivision 6, deductions must be taken for the retirement fund and, upon subsequent retirement,
the person is entitled to a retirement annuity payable based upon all allowable service including
the allowable service upon which the disability benefits were based.
(c) If the employment is not through public service covered under this chapter, the account
may be placed on a deferred status and the subsequent retirement annuity must be calculated as
provided in section 353.34, subdivision 3, if the person meets the length of allowable service
requirement stated in that subdivision; or the person may request a refund of any remaining
employee deductions. The refund must be in an amount equal to the accumulated employee
deductions plus six percent interest compounded annually and must be reduced by the sum of the
disability benefits paid to the member.
    Subd. 10.[Repealed, 1973 c 753 s 85]
    Subd. 11. Coordinated member retirement status. No person is entitled to receive
disability benefits and a retirement annuity at the same time. The disability benefits paid to a
coordinated member must terminate when the person reaches normal retirement age. If the
coordinated member is still totally and permanently disabled upon attaining normal retirement
age, the coordinated member is deemed to be on retirement status. If an optional annuity is elected
under subdivision 3a, the coordinated member shall receive an annuity under the terms of the
optional annuity previously elected, or, if an optional annuity is not elected under subdivision
3a, the coordinated member may elect to receive a normal retirement annuity under section
353.29 or an annuity equal to the disability benefit paid before the coordinated member reaches
normal retirement age, whichever amount is greater, or elect to receive an optional annuity under
section 353.30, subdivision 3. The annuity of a disabled coordinated member who attains normal
retirement age must be computed under the law in effect upon attainment of normal retirement
age. Election of an optional annuity must be made before the coordinated member attains normal
retirement age. If an optional annuity is elected, the election is effective on the date on which the
person attains normal retirement age and the optional annuity begins to accrue on the first day of
the month next following the month in which the person attains that age.
    Subd. 12. Basic disability survivor benefits. If a basic member who is receiving a disability
benefit under subdivision 3:
(1) dies before attaining age 65 or within five years of the effective date of the disability,
whichever is later, the surviving spouse is entitled to receive a survivor benefit under section
353.31, unless the surviving spouse elected to receive a refund under section 353.32, subdivision
1
;
(2) is living at age 65 or five years after the effective date of the disability, whichever is later,
the basic member may continue to receive a normal disability benefit, or elect a joint and survivor
optional annuity under section 353.31, subdivision 1b. The election of the joint and survivor
optional annuity must occur within 90 days of attaining age 65 or of reaching the five-year
anniversary of the effective date of the disability benefit, whichever is later. The optional annuity
takes effect on the first day of the month following the month in which the person attains age
65 or reaches the five-year anniversary of the effective date of the disability benefit, whichever
is later; or
(3) if there is a dependent child or children under clause (1) or (2), the dependent child is
entitled to a dependent child benefit under section 353.31, subdivision 1b, paragraph (b).
History: 1957 c 935 s 13; 1959 c 650 s 21,41; 1961 c 595 s 2; 1963 c 641 s 25; 1965 c 880 s
6; 1967 c 711 s 1; Ex1967 c 37 s 2,3; 1969 c 940 s 10; 1971 c 106 s 29,30; 1973 c 753 s 53-56;
1975 c 102 s 15-17; 1975 c 359 s 23; 1976 c 329 s 23-25; 1977 c 305 s 45; 1977 c 429 s 29,30;
1978 c 471 s 6; 1978 c 796 s 35; 1979 c 216 s 14; 1981 c 68 s 21,22; 1981 c 180 s 11-13; 1981 c
224 s 88; 1983 c 73 s 7; 1983 c 85 s 1; 1984 c 564 s 26; 1986 c 444; 1987 c 284 art 5 s 9; 1987 c
372 art 9 s 14-16; 1988 c 709 art 5 s 19; 1989 c 319 art 3 s 12-16; art 13 s 37-39; 1991 c 341 s
19; 1992 c 432 art 2 s 12-15; 1993 c 307 art 4 s 19-26; 1998 c 390 art 9 s 3; 2000 c 461 art 3 s
16,17; 2004 c 267 art 8 s 15-19,41; 1Sp2005 c 8 art 1 s 12; art 10 s 51; 2006 c 212 art 3 s 34;
2006 c 271 art 3 s 25,26,42; 2007 c 134 art 4 s 9-13
353.335 DISABILITANT EARNINGS REPORTS.
Disability benefit recipients must report all earnings from reemployment and from income
from workers' compensation to the association annually by May 15 in a format prescribed by the
executive director. If the form is not submitted by May 15, benefits must be suspended effective
June 1. Upon receipt of the form by the association, if the disability benefit recipient is deemed
by the executive director to be eligible for continued payment, benefits must be reinstated
retroactive to June 1.
History: 2006 c 271 art 3 s 27
353.34 RIGHTS UPON TERMINATION OF MEMBERSHIP.
    Subdivision 1. Refund or deferred annuity. (a) A former member is entitled to a refund of
accumulated employee deductions under subdivision 2, or to a deferred annuity under subdivision
3. Application for a refund may not be made before the date of termination of public service.
Except as specified in paragraph (b), a refund must be paid within 120 days following receipt
of the application unless the applicant has again become a public employee required to be
covered by the association.
(b) If an individual was placed on layoff under section 353.01, subdivision 12 or 12c, a
refund is not payable before termination of service under section 353.01, subdivision 11a.
(c) An individual who terminates public service covered by the Public Employees Retirement
Association general employees retirement plan, the Public Employees Retirement Association
police and fire retirement plan, or the public employees local government corrections service
retirement plan, and who is employed by a different employer and who becomes an active member
covered by one of the other two plans, may receive a refund of employee contributions plus six
percent interest compounded annually from the plan from which the member terminated service.
    Subd. 2. Refund with interest. Except as provided in subdivision 1, any person who ceases
to be a public employee shall receive a refund in an amount equal to accumulated deductions with
interest to the first day of the month in which the refund is processed at the rate of six percent
compounded annually based on fiscal year balances. If a person repays a refund and subsequently
applies for another refund, the repayment amount, including interest, is added to the fiscal year
balance in which the repayment was made.
    Subd. 3. Deferred annuity; eligibility; computation. A member with at least three years
of allowable service when termination of public service or termination of membership occurs
has the option of leaving the accumulated deductions in the fund and being entitled to a deferred
retirement annuity commencing at normal retirement age or to a deferred early retirement annuity
under section 353.30, subdivision 1a, 1b, 1c, or 5. The deferred annuity must be computed under
section 353.29, subdivision 3, on the basis of the law in effect on the date of termination of
public service or termination of membership, whichever is earlier, and must be augmented as
provided in section 353.71, subdivision 2. A former member qualified to apply for a deferred
retirement annuity may revoke this option at any time before the commencement of deferred
annuity payments by making application for a refund. The person is entitled to a refund of
accumulated member contributions within 30 days following date of receipt of the application
by the executive director.
    Subd. 3a. Deferred annuity; certain hospital employees. Any member employed by a
public hospital, as defined in section 355.01, subdivision 3k, who has at least three years of
allowable service credit on the date the public hospital is taken over by a private corporation or
organization, may elect to receive a deferred annuity pursuant to subdivision 3 notwithstanding
the length of service requirement contained therein.
    Subd. 3b.[Repealed, 1Sp2005 c 8 art 10 s 81]
    Subd. 4.[Repealed, 1971 c 106 s 40]
    Subd. 5. Refundment generally unlimited. The right of refundment provided in this
chapter, and laws amendatory thereof, is not restricted as to time unless specifically provided and
the statute of limitation does not apply thereto.
    Subd. 6. Additions to fund. The board of trustees may credit to the fund any moneys
received in the form of contributions, donations, gifts, appropriations, bequests, or otherwise.
    Subd. 7.[Repealed, 2007 c 134 art 2 s 50]
History: 1957 c 935 s 14; 1959 c 650 s 22-24,49; 1963 c 641 s 26-29; 1969 c 940 s 11; 1971
c 106 s 31; 1971 c 412 s 1; 1973 c 753 s 57-59; 1975 c 102 s 6; 1976 c 329 s 26; 1978 c 796 s 36;
1979 c 216 s 15; 1981 c 224 s 89; 1983 c 58 s 1; 1983 c 73 s 8; 1984 c 564 s 27; 1984 c 574 s 10;
1985 c 261 s 4; 1986 c 444; 1987 c 284 art 5 s 10; 1987 c 372 art 9 s 17; 1988 c 709 art 5 s 20;
1989 c 319 art 3 s 17; art 13 s 40-42; 1991 c 341 s 20; 1992 c 432 art 2 s 16; 1993 c 307 art 4 s
27,28; 2000 c 461 art 3 s 18; 2005 c 10 art 5 s 2; 2006 c 271 art 3 s 28; 2007 c 134 art 2 s 30
353.35 CONSEQUENCES OF REFUND; REPAYMENT, RIGHTS RESTORED.
    Subdivision 1. Refund rights. When any former member accepts a refund, all existing
service credits and all rights and benefits to which the person was entitled prior to the acceptance
of the refund must terminate. The rights and benefits of a former member must not be restored
until the person returns to active service and acquires at least six months of allowable service
credit after taking the last refund and repays the refund or refunds taken and interest received
under section 353.34, subdivisions 1 and 2, plus interest at an annual rate of 8.5 percent
compounded annually. If the person elects to restore service credit in a particular fund from which
the person has taken more than one refund, the person must repay all refunds to that fund. All
refunds must be repaid within six months of the last date of termination of public service.
    Subd. 2. Refund repayment. A person who receives a refund of accumulated employee
deductions, plus interest, may repay the total amount of the refund including the interest, within
30 days of the date the refund was issued, to retain allowable service.
History: 1957 c 935 s 15; 1959 c 650 s 38; 1963 c 641 s 30; 1971 c 106 s 32; 1973 c 753 s
60; 1976 c 329 s 27; 1979 c 216 s 16; 1982 c 404 s 6; 1986 c 444; 1989 c 319 art 3 s 18; 1990
c 570 art 11 s 7; 1992 c 598 art 2 s 6; 1993 c 307 art 4 s 29
353.36    Subdivision 1.[Repealed, 1971 c 106 s 40]
    Subd. 2.[Repealed, 1Sp2005 c 8 art 10 s 81]
    Subd. 2a.[Repealed, 1Sp2005 c 8 art 10 s 81]
    Subd. 2b.[Repealed, 1Sp2005 c 8 art 10 s 81]
    Subd. 2c.[Repealed, 1Sp2005 c 8 art 10 s 81]
    Subd. 2d.[Repealed, 1977 c 429 s 65]
    Subd. 3.[Repealed, 1971 c 106 s 40]
    Subd. 4.[Repealed, 1965 c 715 s 4]
    Subd. 5.[Repealed, 1973 c 753 s 85]
    Subd. 6.[Repealed, 1973 c 753 s 85]
    Subd. 7.[Repealed, 1973 c 753 s 85]
    Subd. 8.[Repealed, 1973 c 753 s 85]
    Subd. 9.[Repealed, 1973 c 753 s 85]
    Subd. 10.[Repealed, 1973 c 753 s 85]
353.37 REEMPLOYMENT OF ANNUITANT.
    Subdivision 1. Salary maximums. The annuity of a person otherwise eligible for an annuity
under this chapter must be suspended under subdivision 2 or reduced under subdivision 3,
whichever results in the higher annual annuity amount, if the person reenters public service as
a nonelective employee of a governmental subdivision in a position covered by this chapter or
returns to work as an employee of a labor organization that represents public employees who are
association members under this chapter and salary for the reemployment service exceeds the
annual maximum earnings allowable for that age for the continued receipt of full benefit amounts
monthly under the federal Old Age, Survivors and Disability Insurance Program as set by the
secretary of health and human services under United States Code, title 42, section 403, in any
calendar year. If the person has not yet reached the minimum age for the receipt of Social Security
benefits, the maximum salary for the person is equal to the annual maximum earnings allowable
for the minimum age for the receipt of Social Security benefits.
    Subd. 1a.[Repealed, 1981 c 180 s 18]
    Subd. 1b. Retirement age. For purposes of this section, "retirement age" means retirement
age as defined in United States Code, title 42, section 416(l).
    Subd. 2.MS 1971 [Repealed, 1973 c 753 s 85]
    Subd. 2. Suspension of annuity. The association shall suspend the annuity on the first of the
month after the month in which the salary of the reemployed annuitant exceeds the maximums
set in subdivision 1, based only on those months in which the annuitant is actually employed in
nonelective public service in a position covered under this chapter or employment with a labor
organization that represents public employees who are association members under this chapter.
An annuitant who is elected to public office after retirement may hold office and receive an
annuity otherwise payable from the association.
    Subd. 3.MS 1971 [Repealed, 1973 c 753 s 85]
    Subd. 3. Reduction of annuity. The association shall reduce the amount of the annuity of
a person who has not reached the retirement age by one-half of the amount in excess of the
applicable reemployment income maximum under subdivision 1.
There is no reduction upon reemployment, regardless of income, for a person who has reached the
retirement age.
    Subd. 3a. Disposition of suspension or reduction amount. The balance of the annual
retirement annuity after suspension or the amount of the retirement annuity reduction must be
handled or disposed of as provided in section 356.47.
    Subd. 4. Resumption of annuity. The association shall resume paying a full annuity to the
reemployed annuitant at the start of each calendar year until the salary exceeds the maximums
under subdivision 1, or on the first of the month following termination of employment which
resulted in the suspension of the annuity. The executive director may adopt policies regarding
the suspension and reduction of annuities under this section.
    Subd. 5. Effect on annuity. Except as provided under this section, public service performed
by an annuitant subsequent to retirement under this chapter does not increase or decrease the
amount of an annuity. The annuitant shall not make any further contributions to the association's
defined benefit plan by reason of this subsequent public service.
History: 1957 c 935 s 17; 1959 c 650 s 26,58; Ex1961 c 87 s 1; 1963 c 641 s 31; 1963 c 853
s 1,2; 1967 c 711 s 2; 1971 c 412 s 2; 1973 c 753 s 63; 1975 c 102 s 18; 1977 c 429 s 32; 1980 c
342 s 7; 1981 c 224 s 91; 1988 c 709 art 5 s 21; 1992 c 440 s 1; 1993 c 307 art 4 s 30; 1994 c 528
art 2 s 9-11; 2000 c 461 art 2 s 5; 2002 c 392 art 11 s 52; 2004 c 267 art 7 s 2,3
353.38 [Repealed, 1984 c 564 s 51]
353.39 [Repealed, 1973 c 753 s 85]
353.40 [Repealed, 1974 c 229 s 25]
353.41 [Repealed, 1959 c 650 s 57]
353.42 [Repealed, 1963 c 641 s 38]
353.43 [Repealed, 1959 c 650 s 57]
353.44    Subdivision 1.[Repealed, 1973 c 753 s 85]
    Subd. 2.[Repealed, 1963 c 641 s 38]
353.45 [Repealed, 1973 c 753 s 85]
353.46 SAVINGS CLAUSES.
    Subdivision 1.[Repealed, 1981 c 180 s 18]
    Subd. 1a. Purchase of allowable service; annuity. A person who purchased allowable
service in the Public Employees Retirement Association for a period of time including June 30,
1957, but was not in fact a member of the association on June 30, 1957, shall not be entitled to
receive retirement annuity computed under Minnesota Statutes 1971, section 353.46, subdivision
1
. This section shall have retroactive application to any such person receiving or found eligible by
the district court to receive benefits calculated under Minnesota Statutes 1971, section 353.46,
subdivision 1
.
    Subd. 2. Rights of deferred annuitant. The right of a deferred annuitant or other former
member to receive an annuity under the law in effect at the time such person terminated public
service is herein preserved; provided, however, the provisions of section 353.71, subdivision 2, as
amended by Laws 1973, chapter 753 shall apply to a deferred annuitant or other former member
who first begins receiving an annuity after July 1, 1973.
    Subd. 3.[Repealed, 1977 c 429 s 65]
    Subd. 4.[Repealed, 1Sp2005 c 8 art 10 s 81]
    Subd. 5.[Repealed, 1973 c 753 s 85]
    Subd. 6. Computation of benefits for certain coordinated members. Any coordinated
member who prior to July 1, 1979 was a member of the coordinated program of the Minneapolis
Municipal Employees Retirement Fund and who prior to July 1, 1978 was a member of the basic
program of the Minneapolis Municipal Employees Retirement Fund shall:
(1) be entitled to receive a retirement annuity when otherwise qualified, the calculation
of which shall utilize the formula accrual rates specified in section 422A.15, subdivision 1,
for that portion of credited service which was rendered prior to July 1, 1978, and the formula
accrual rates specified in section 353.29, subdivision 3, for the remainder of credited service, both
applied to the average salary as specified in section 353.29, subdivision 2. The formula accrual
rates to be used in calculating the retirement annuity shall recognize the service after July 1, 1978
as a member of the coordinated program of the Minneapolis Municipal Employees Retirement
Fund and after July 1, 1979 as a member of the Public Employees Retirement Association as
a continuation of service rendered prior to July 1, 1978. The annuity amount attributable to
service as a member of the basic program of the Minneapolis Municipal Employees Retirement
Fund shall be payable by the Minneapolis Employees Retirement Fund and the annuity amount
attributable to all other service shall be payable by the Public Employees Retirement Association;
(2) retain eligibility when otherwise qualified for a disability benefit from the Minneapolis
Employees Retirement Fund until July 1, 1982, notwithstanding coverage by the Public
Employees Retirement Association, if the member has or would, without the transfer of retirement
coverage from the basic program of the Minneapolis Municipal Employees Retirement Fund to
the coordinated program of the Minneapolis Municipal Employees Retirement Fund or from the
coordinated program of the Minneapolis Municipal Employees Retirement Fund to the public
employees retirement fund, have sufficient credited service prior to January 1, 1983, to meet the
minimum service requirements for a disability benefit pursuant to section 422A.18. The disability
benefit amount attributable to service as a member of the basic program of the Minneapolis
Municipal Employees Retirement Fund shall be payable by the Minneapolis Employees
Retirement Fund and the disability benefit amount attributable to all other service shall be payable
by the Public Employees Retirement Association.
History: 1957 c 935 s 26; 1959 c 650 s 27; Ex1961 c 87 s 2; 1965 c 814 s 1,3; 1971 c 106 s
36; 1973 c 753 s 65-68; 1975 c 102 s 19; 1977 c 4 29 s 33; 1981 c 224 s 93,94; 1981 c 298 s
11; 1990 c 570 art 11 s 8; 1991 c 341 s 21
353.51 [Repealed, 1973 c 753 s 85]
353.52 [Repealed, 1973 c 753 s 85]
353.53 [Repealed, 1973 c 753 s 85]
353.54 [Repealed, 1973 c 753 s 85]
353.55 [Repealed, 1973 c 753 s 85]
353.56 [Repealed, 1973 c 753 s 85]
353.57 [Repealed, 1973 c 753 s 85]
353.58 [Repealed, 1973 c 753 s 85]
353.59 [Repealed, 1973 c 753 s 85]
353.591 [Repealed, 1973 c 753 s 85]
353.60 [Repealed, 1973 c 753 s 85]
353.61 [Repealed, 1973 c 753 s 85]
353.62 [Repealed, 1971 c 106 s 40]
353.63 POLICY.
It is the recognized policy of the state that special consideration should be given to
employees of governmental subdivisions who devote their time and skills to protecting the
property and personal safety of others. Since this work is hazardous, special provisions are hereby
made for retirement pensions, disability benefits and survivors benefits based on the particular
dangers inherent in these occupations. The benefits provided in sections 353.63 to 353.68 are
more costly than similar benefits for other public employees since they are computed on the
basis of a shorter working lifetime taking into account experience which has been universally
recognized. This extra cost should be borne by the employee and employer alike at the ratio of 40
percent employee contributions and 60 percent employer contributions.
History: 1959 c 650 s 31
353.64 MEMBERSHIP; QUALIFICATIONS; POLICE OFFICER, FIREFIGHTER.
    Subdivision 1. Police and fire plan membership; mandatory. A governmental subdivision
must report a public employee for membership in the police and fire plan if the employee is
employed full time as specified in clause (1), (2), or (3):
(1) a full-time police officer or a person in charge of a designated police or sheriff's
department, who by virtue of that employment is required by the employing governmental
subdivision to be and is licensed by the Minnesota peace officer standards and training board
under sections 626.84 to 626.863, who is charged with the prevention and detection of crime, who
has the full power of arrest, who is assigned to a designated police or sheriff's department, and
whose primary job is the enforcement of the general criminal laws of the state;
(2) a full-time firefighter or a person in charge of a designated fire company or companies
who is engaged in the hazards of fire fighting; or
(3) a full-time police officer or firefighter meeting all requirements of clause (1) or (2), as
applicable, who as part of the employment position is periodically assigned to employment duties
in the same department that are not within the scope of this subdivision.
An individual to which clause (3) applies must contribute as a member of the police and fire
plan for both the primary and secondary services that are provided to the employing governmental
subdivision.
    Subd. 1a. Police and fire plan; other members. (a) A person who prior to July 1, 1961, was
a member of the police and fire plan, by virtue of being a police officer or firefighter, shall, as long
as the person remains in either position, continue membership in the plan.
(b) A person who was employed by a governmental subdivision as a police officer and was a
member of the police and fire plan on July 1, 1978, by virtue of being a police officer as defined
by this section on that date, and if employed by the same governmental subdivision in a position
in the same department in which the person was employed on that date, continues to be a member
of the plan, whether or not that person has the power of arrest by warrant and is licensed by the
Peace Officers Standards and Training Board after that date.
(c) A person who was employed as a correctional officer by Rice county before July 1, 1998,
for the duration of employment in the correctional position held on July 1, 1998, continues to
be a member of the public employees police and fire plan, whether or not the person has the
power of arrest by warrant and is licensed by the Peace Officers Standards and Training Board
after that date.
(d) A person who was employed by a governmental subdivision as a police officer or a
firefighter, whichever applies, was an active member of the local police or salaried firefighters
relief association located in that governmental subdivision by virtue of that employment as of the
effective date of the consolidation as authorized by sections 353A.01 to 353A.10, and has elected
coverage by the public employees police and fire plan, shall become a member of the police and
fire plan after that date if employed by the same governmental subdivision in a position in the
same department in which the person was employed on that date.
(e) Any police officer or firefighter of a relief association that has consolidated with the
association for which the employee has not elected coverage by the public employees police and
fire plan as provided in sections 353A.01 to 353A.10, or any police officer or firefighter to whom
section 353.665 applies who has not elected coverage by the public employees police and fire plan
as provided in section 353.665, subdivision 4, must become a member of the public employees
police and fire plan, but is not subject to the provisions of sections 353.651 to 353.659 unless an
election for such coverage is made under section 353.665, subdivision 4.
    Subd. 2. Police and fire fund membership; part-time employment coverage option. (a)
The governing body of a governmental subdivision may adopt a resolution, subject to requirements
specified in paragraph (b), declaring that a public employee employed in a position on a part-time
basis by that governmental subdivision is covered by the police and fire plan for that employment.
(b) If the public employee's position is related to police service, the resolution is valid if
the conditions specified in paragraph (c) are met. If the public employee's position is related to
fire service, the resolution is valid if the conditions specified in paragraph (d) are met. If the
public employee in the applicable position is periodically assigned to employment duties not
within the scope of this subdivision, the resolution is considered valid if the governing body of
the governmental subdivision declares that the public employee's position, for primary services
provided, satisfies all of the requirements of subdivision 1, clause (3), other than the requirement
of full-time employment.
(c) For the governing body of the governmental subdivision to declare a position to be that
of a police officer, the duties and qualifications of the person so employed must, at a minimum,
satisfy all of the requirements of subdivision 1, clause (1), other than the requirement of full-time
employment.
(d) For the governing body of a governmental subdivision to declare a position to be that
of a firefighter, the duties and qualifications of the person so employed must, at a minimum,
satisfy all of the requirements of subdivision 1, clause (2), other than the requirement of full-time
employment.
    Subd. 3. Police and fire fund membership; exclusion. A police officer or firefighter
employed by a governmental subdivision who by virtue of that employment is required by law to
be a member of and to contribute to any police or firefighter relief association governed by section
69.77 which has not consolidated with the public employees police and fire plan is not eligible to
become a member of the public employees police and fire plan.
    Subd. 4. Resolution filing. (a) A copy of the resolution of the governing body declaring a
position to be that of police officer or firefighter shall be promptly filed with the board of trustees
and shall be irrevocable.
(b) Following the receipt of adequate notice from the association, if a valid resolution is not
filed with the public employees retirement association within six months following the date of
that notice, any contributions or deductions made to the police and fire fund for the applicable
employment are deemed to be contributions or deductions transmitted in error under section
353.27, subdivision 7a.
    Subd. 5.[Repealed, 1977 c 429 s 65]
    Subd. 5a. Transfers. A member of the police and fire fund continues to be a member of that
fund if transferred to a different position with associated police or fire department functions in
the same department or a related department in the same governmental subdivision provided the
governing body sends a copy of a resolution to that effect to the association. A police and fire
fund member who is elected or assumes an appointive position, including but not limited to, the
positions of city council member, city manager, and finance director is not eligible to retain
membership in the public employees police and fire fund.
    Subd. 6.[Repealed, 1987 c 284 art 5 s 18]
    Subd. 6a. University of Minnesota police officers; inclusions and exclusions. (a) Unless
paragraph (b) applies, a person who is employed as a peace officer by the University of Minnesota
at any campus or facility of the university, who is required by the university to be and is licensed
as a peace officer by the Minnesota Peace Officer Standards and Training Board under sections
626.84 to 626.863, and who has the full power of arrest is a member of the public employees
police and fire retirement plan.
(b) A police officer employed by the University of Minnesota who is required by the Board
of Regents to contribute to the University of Minnesota faculty retirement plan is not eligible to
be a member of the public employees police and fire retirement plan.
    Subd. 7. Pension coverage for certain public safety employees of the Metropolitan
Airports Commission. Any person first employed as either a full-time firefighter or a full-time
police officer by the Metropolitan Airports Commission after June 30, 1978, who is not eligible
for coverage under the agreement signed between the state and the secretary of the federal
Department of Health and Human Services making the provisions of the federal Old Age,
Survivors, and Disability Insurance Act applicable to municipal employees because that position
is excluded from application pursuant to Title 42, United States Code, Sections 418 (d) (5) (A)
and 418 (d) (8) (D) and section 355.07, shall not be a member of the Minneapolis Employees
Retirement Fund but shall be a member of the public employees police and fire fund and shall be
deemed to be a firefighter or a police officer within the meaning of this section. The Metropolitan
Airports Commission shall make the employer contribution required pursuant to section 353.65,
subdivision 3
, with respect to each of its firefighters or police officers covered by the public
employees police and fire fund and shall meet the employers recording and reporting requirements
set forth in section 353.65, subdivision 4.
    Subd. 7a. Pension coverage for certain metropolitan transit police officers. A person
who is employed as a police officer on or after the first day of the first payroll period after July 1,
1993, by the Metropolitan Council and who is not eligible for coverage under the agreement with
the Secretary of the federal Department of Health and Human Services making the provisions
of the federal Old Age, Survivors, and Disability Insurance Act because the person's position is
excluded from application under United States Code, sections 418(d)(5)(A) and 418(d)(8)(D),
and under section 355.07, is a member of the public employees police and fire fund and is
considered to be a police officer within the meaning of this section. The Metropolitan Council
shall deduct the employee contribution from the salary of each police officer as required by
section 353.65, subdivision 2, shall make the employer contribution for each police officer as
required by section 353.65, subdivision 3, and shall meet the employer recording and reporting
requirements in section 353.65, subdivision 4.
    Subd. 8. Pension coverage for certain state military affairs department firefighters. A
person who is employed as a full-time firefighter on or after the first day of the first payroll period
after June 10, 1987, by the Department of Military Affairs of the state of Minnesota and who
is not eligible for coverage under the agreement signed between the state and the secretary of
the federal Department of Health and Human Services making the provisions of the federal Old
Age, Survivors, and Disability Insurance Act applicable to state employees because the person's
position is excluded from application under United States Code, title 42, sections 418(d)(5)(A)
and 418(d)(8)(D) and section 355.07, is a member of the public employees police and fire fund
and is considered to be a firefighter within the meaning of this section. The state Department
of Military Affairs shall make the employee contribution deduction from the salary of each
full-time Military Affairs Department firefighter as required by section 353.65, subdivision 2,
shall make the employer contribution with respect to each firefighter as required by section
353.65, subdivision 3, and shall meet the employer recording and reporting requirements in
section 353.65, subdivision 4.
    Subd. 9. Pension coverage for certain sheriffs' association employees. A former member
of the association who is an employee of the Minnesota Sheriffs' Association may elect to be a
police and fire fund member with respect to service with the sheriffs' association, if written
election to be covered is delivered to the board within 60 days after July 1, 1989, or within 60
days after commencement of employment, whichever is later.
Employee and employer contributions for past service are the obligation of the employee,
except that the Minnesota sheriffs' association may pay the employer contributions. The employer
shall, in any event, deduct necessary future contributions from the employee's salary and remit
all contributions to the association as required by this chapter.
Persons who become association members under this section shall not be eligible for election
to the board of trustees.
    Subd. 10. Pension coverage for Hennepin Healthcare System, Inc.; paramedics and
emergency medical technicians. An employee of Hennepin Healthcare System, Inc. who is:
(1) certified as a paramedic or emergency medical technician by the state under section
144E.28, subdivision 4;
(2) employed full time as a paramedic or emergency medical technician by Hennepin County
on or after the effective date specified in Laws 1994, chapter 499, section 2; and
(3) not eligible after the effective date under Laws 1994, chapter 499, section 2, for coverage
under the agreement signed between the state and the secretary of the federal Department of
Health and Human Services making the provisions of the federal Old Age, Survivors, and
Disability Insurance Act applicable to paramedics and emergency medical technicians because
the person's position is excluded after that date from application under United States Code, title
42, sections 418(d)(5)(A) and 418(d)(8)(D), and section 355.07;
is a member of the public employees police and fire fund under sections 353.63 to 353.68.
Hennepin Healthcare System, Inc. shall deduct the employee contribution from the salary of
each full-time paramedic and emergency medical technician it employs as required by section
353.65, subdivision 2, shall make the employer contribution for each full-time paramedic and
emergency medical technician it employs as required by section 353.65, subdivision 3, and shall
meet the employer recording and reporting requirements in section 353.65, subdivision 4.
    Subd. 11. Pension coverage for certain tribal police officers exercising state arrest
powers. (a) The governing body of a tribal police department which is exercising state arrest
powers under section 626.90, 626.91, 626.92, or 626.93 may request by resolution to the executive
director that its police officers be considered public employees under section 353.01, subdivision
2
, be considered a police officer under section 353.64, subdivision 1, and become members of
the public employees police and fire retirement plan and that the tribal police department be
considered a governmental subdivision under section 353.01, subdivision 6.
(b) The executive director of the association must approve the request by a tribal police
department under paragraph (a) if a ruling made by the federal Internal Revenue Service provides
that:
(1) the tribal police department is an agency or instrumentality of the state of Minnesota for
purposes of enforcing state law; and
(2) contributions made by the tribal police department to a retirement plan on behalf of
employees of the tribal police department are contributions to a governmental plan within the
meaning of section 414(d) of the federal Internal Revenue Code.
(c) Following the approval of the request by the executive director, the head of the police
department or that person's designee must immediately report for membership in the police and
fire fund a person who is employed as a full-time or part-time police officer in a position that meets
the conditions in sections 353.01, subdivision 2a, and 353.64, subdivisions 1 and 2. The police
department head or that person's designee must deduct the employee contributions from the salary
of each eligible police officer as required by section 353.65, subdivision 2, and make the employer
contributions required by section 353.65, subdivision 3. The head of the police department or that
person's designee must meet the reporting requirements in section 353.65, subdivision 4.
History: 1959 c 650 s 32; 1961 c 743 s 1; 1963 c 641 s 34; 1978 c 720 s 7; 1979 c 216 s 17;
1979 c 262 s 2; 1981 c 180 s 14,15; 1981 c 224 s 95; 1981 c 298 s 11; 1982 c 404 s 8; 1987 c 284
art 5 s 12,13; 1987 c 296 s 5; 1987 c 372 art 1 s 6; 1989 c 319 art 3 s 19-21; art 11 s 1; 1991 c
341 s 22; 1992 c 432 art 2 s 17; 1993 c 307 art 4 s 31-33; 1994 c 499 s 1; 1994 c 628 art 3 s 31;
1997 c 7 art 1 s 129; 1997 c 199 s 14; 1999 c 222 art 4 s 7; art 14 s 2; 1999 c 245 art 9 s 65; 2000
c 461 art 3 s 19-22; art 7 s 2; 2002 c 392 art 3 s 8; 2005 c 125 art 3 s 4; 1Sp2005 c 8 art 4 s 6

NOTE: The amendment to subdivision 10 by Laws 2005, chapter 125, article 3, section
4, is effective the day after the Hennepin County Board files a certificate of local approval in
compliance with section 645.021, subdivision 3. Laws 2005, chapter 125, article 1, section 29, as
amended by Laws 2005, First Special Session chapter 7, section 34; and Laws 2005, chapter 125,
article 3, section 7.
353.65 CONTRIBUTIONS.
    Subdivision 1. Fund established. The public employees police and fire fund is established
for police officers and firefighters who meet the eligibility criteria under section 353.64. Employee
contributions, employer contributions, other than the excess contribution established by section
69.031, subdivision 5, paragraphs (2), clauses (b) and (c), and (3), and other amounts authorized
by law, including all employee and employer contributions of members transferred must be
deposited in the public employees police and fire fund.
    Subd. 2. Employee contribution rate. (a) The employee contribution is an amount equal to
the percent of the total salary of the member specified in paragraph (b). This contribution must be
made by deduction from salary in the manner provided in subdivision 4. Where any portion of
a member's salary is paid from other than public funds, the member's employee contribution is
based on the total salary received from all sources.
(b) For calendar year 2006, the employee contribution rate is 7.0 percent. For calendar
year 2007, the employee contribution rate is 7.8 percent. For calendar year 2008, the employee
contribution rate is 8.6 percent. For calendar year 2009 and thereafter, the employee contribution
rate is 9.4 percent.
    Subd. 3. Employer contribution rate. (a) The employer contribution shall be an amount
equal to the percent of the total salary of every member as specified in paragraph (b). This
contribution shall be made from funds available to the employing subdivision by the means
and in the manner provided in section 353.28.
(b) For calendar year 2006, the employer contribution rate is 10.5 percent. For calendar
year 2007, the employer contribution rate is 11.7 percent. For calendar year 2008, the employer
contribution rate is 12.9 percent. For calendar year 2009 and thereafter, the employer contribution
rate is 14.1 percent.
    Subd. 3a.[Repealed, 1999 c 222 art 4 s 20]
    Subd. 4. Contribution deductions. The head of each department of the various
governmental subdivisions is hereby directed to cause employee contributions to be deducted in
the manner and subject to the terms provided in section 353.27, subdivision 4.
    Subd. 5.[Repealed, 1973 c 753 s 85]
    Subd. 6. Fund. All contributions other than the excess contribution established by section
69.031, subdivision 5, paragraphs (2), clauses (b) and (c), and (3) shall be credited to the fund and
all interest and other income of the fund shall be credited to said fund. The retirement fund shall
be disbursed only for the purposes herein provided. The expenses of said fund and the annuities
herein provided upon retirement shall be paid from said fund.
    Subd. 7.[Repealed, 1996 c 390 s 41]
History: 1959 c 650 s 33; 1965 c 714 s 6-8; Ex1967 c 53 s 6-8; 1971 c 297 s 5; 1973 c 753 s
69,70; 1979 c 216 s 18; 1987 c 296 s 6; 1988 c 709 art 5 s 22; 1989 c 319 art 6 s 3-5; 1992 c 432
art 2 s 18; 1993 c 352 s 1-3; 1994 c 528 art 2 s 12; 1994 c 632 art 3 s 56; 1995 c 262 art 4 s 1;
1999 c 222 art 4 s 8,9; 1Sp2005 c 8 art 5 s 7,8
353.651 RETIREMENT ANNUITY UPON SEPARATION FROM PUBLIC SERVICE.
    Subdivision 1. Age and allowable service requirements. Upon separation from public
service, any police officer or firefighter member who has attained the age of at least 55 years and
who received credit for not less than three years of allowable service is entitled upon application
to a retirement annuity. Such retirement annuity is known as the "normal" retirement annuity.
    Subd. 2.[Repealed, 1Sp2005 c 8 art 1 s 32]
    Subd. 3. Retirement annuity formula. The average salary as defined in section 353.01,
subdivision 17a
, multiplied by the percent specified in section 356.315, subdivision 6, per year of
allowable service determines the amount of the normal retirement annuity. If the member has
earned allowable service for performing services other than those of a police officer or firefighter,
the annuity representing that service must be computed under sections 353.29 and 353.30.
    Subd. 4. Early retirement. (a) A person who becomes a police and fire plan member after
June 30, 2007, or a former member who is reinstated as a member of the plan after that date, who
is at least 50 years of age with at least three years of allowable service, upon the termination of
public service is entitled upon application to a retirement annuity equal to the normal annuity
calculated under subdivision 3, reduced by two-tenths of one percent for each month that the
member is under age 55 at the time of retirement.
    (b) Upon the termination of public service, any police and fire plan member not specified in
paragraph (a), upon attaining at least 50 years of age with at least three years of allowable service
is entitled upon application to a retirement annuity equal to the normal annuity calculated under
subdivision 3, reduced by one-tenth of one percent for each month that the member is under age
55 at the time of retirement.
History: 1973 c 753 s 71; 1974 c 229 s 19; 1977 c 429 s 34; 1984 c 564 s 28; 1987 c 372
art 9 s 18,19; 1989 c 319 art 13 s 43,44; art 17 s 12,13; 1990 c 570 art 12 s 22; 1993 c 352 s
4; 1995 c 262 art 3 s 4; 1997 c 233 art 1 s 41; 1999 c 222 art 14 s 3; 2002 c 392 art 11 s 52;
1Sp2005 c 8 art 1 s 13; 2007 c 134 art 4 s 14
353.652 SOCIAL SECURITY BENEFIT OFFSET IN CERTAIN INSTANCES.
(a) If a public employee continues in retirement plan coverage by the public employees
police and fire retirement plan by virtue of this article and subsequently is covered by the federal
old age, survivors, and disability insurance program for service as a Rice County correctional
officer, the retirement annuity of the person under section 353.651 or the disability benefit of the
person under section 353.656 must be reduced dollar for dollar for the Social Security benefit that
the person is entitled to receive by virtue of Rice County correctional service rendered after the
effective date of section 1.
(b) To be effective, the retirement annuity or disability benefit application form for a Rice
County correctional employee must include signed written permission by the person for the Public
Employees Retirement Association to obtain the necessary information from the federal old age,
survivors, and disability insurance program to implement the offset provision in paragraph (a).
History: 1999 c 222 art 14 s 4
353.654 [Repealed, 1973 c 753 s 85]
353.655 [Repealed, 1973 c 753 s 85]
353.656 DISABILITY BENEFITS.
    Subdivision 1. Duty disability; computation of benefits. (a) A member of the police and
fire plan who is determined to qualify for duty disability as defined in section 353.01, subdivision
41, shall receive disability benefits during the period of such disability in an amount equal to 60
percent of the average salary as defined in section 353.01, subdivision 17a.
    (b) To be eligible for a benefit under paragraph (a), the member must have:
    (1) not met the requirements for a retirement annuity under section 353.651, subdivision 1; or
    (2) met the requirements under that subdivision, but does not have at least 20 years of
allowable service credit.
    (c) If paragraph (b), clause (2), applies, the disability benefit must be paid for a period of
60 months from the disability benefit accrual date and at the end of that period is subject to
provisions of subdivision 5a.
    (d) If the disability under this subdivision occurs before the member has at least five years of
allowable service credit in the police and fire plan, the disability benefit must be computed on the
average salary from which deductions were made for contribution to the police and fire fund.
    Subd. 1a.MS 2006 [Renumbered, subd 1b]
    Subd. 1a. Total and permanent duty disability; computation of benefits. (a) A member
of the police and fire plan whose disabling condition is determined to be a duty disability that
is also a permanent and total disability as defined in section 353.01, subdivision 19, is entitled
to receive, for life, disability benefits in an amount equal to 60 percent of the average salary as
defined in section 353.01, subdivision 17a, plus an additional percent specified in section 356.315,
subdivision 6
, of that average salary for each year of service in excess of 20 years.
    (b) A disability benefit payable under paragraph (a) is subject to eligibility review under
section 353.33, subdivision 6, but the review may be waived if the executive director receives a
written statement from the association's medical advisor that no improvement can be expected in
the member's disabling condition that was the basis for payment of the benefit under paragraph
(a). A member receiving a disability benefit under this subdivision who is found to no longer be
permanently and totally disabled as defined under section 353.01, subdivision 19, but continues to
meet the definition for receipt of a duty disability under section 353.01, subdivision 41, is subject
to subdivision 1 upon written notice from the association's medical advisor that the person is no
longer considered permanently and totally disabled.
    (c) If a member approved for disability benefits under this subdivision dies before attaining
normal retirement age as defined in section 353.01, subdivision 37, paragraph (b), or within 60
months of the effective date of the disability, whichever is later, the surviving spouse is entitled to
receive a survivor benefit under section 353.657, subdivision 2, paragraph (a), clause (1), if the
death is the direct result of the disabling condition for which disability benefits were approved, or
section 353.657, subdivision 2, paragraph (a), clause (2), if the death is not directly related to the
disabling condition for which benefits were approved under this subdivision.
    (d) If the election of an actuarial equivalent optional annuity is not made at the time the
permanent and total disability benefit accrues, an election must be made within 90 days before the
member attains normal retirement age as defined under section 353.01, subdivision 37, paragraph
(b), or having collected total and permanent disability benefits for 60 months, whichever is
later. If a member receiving disability benefits who has dependent children dies, subdivision
6a, paragraph (c), applies.
    Subd. 1b. Optional annuity election. (a) A disabled member of the police and fire fund
may elect to receive the normal disability benefit or an actuarial equivalent optional annuity. If
the election of an actuarial equivalent optional annuity is made before the commencement of
payment of the disability benefit, the optional annuity must begin to accrue on the same date as
the disability benefit covering only the disabilitant would have accrued.
    (b) If an election of an optional annuity is not made before the commencement of the
disability benefit, the disabilitant may elect an optional annuity:
    (1) within 90 days before normal retirement age;
    (2) upon the filing of an application to convert to an early retirement annuity, if electing to
convert to an early retirement annuity before the normal retirement age; or
    (3) within 90 days before the expiration of the 60-month period for which a disability benefit
is paid, if the disability benefit is payable because the disabled member did not have at least 20
years of allowable service at normal retirement age.
    (c) If a disabled member who has named a joint and survivor optional annuity beneficiary
dies before the disability benefit ceases and is recalculated under subdivision 5a, the beneficiary
eligible to receive the joint and survivor annuity may elect to have the annuity converted at the
times designated in paragraph (b), clause (1), (2), or (3), whichever allows for the earliest payment
of a higher joint and survivor annuity option resulting from recalculation under subdivision 5a,
paragraph (e).
    (d) A disabled member may name a person other than the spouse as beneficiary of a joint and
survivor annuity only if the spouse of the disabled member permanently waives surviving spouse
coverage on the disability application form prescribed by the executive director.
    (e) If the spouse of the member permanently waives survivor coverage, the dependent child
or children, if any, continue to be eligible for dependent child benefits under section 353.657,
subdivision 3
, and the designated optional annuity beneficiary may draw the monthly benefit.
    (f) Any optional annuity under this subdivision, plus dependent child benefits, if applicable,
are subject to the maximum and minimum family benefit amounts specified in section 353.657,
subdivision 3a
.
    Subd. 2. Benefits paid under workers' compensation law. If a member, as described
in subdivision 1, is injured under circumstances which entitle the member to receive benefits
under the workers' compensation law, the member shall receive the same benefits as provided
in subdivision 1, with disability benefits paid reimbursed and future benefits reduced by all
periodic or lump sum amounts paid to the member under the workers' compensation law, after
deduction of amount of attorney fees, authorized under applicable workers' compensation laws,
paid by a disabilitant if the total of the single life annuity actuarial equivalent disability benefit
and the workers' compensation benefit exceeds: (1) the salary the disabled member received as of
the date of the disability or (2) the salary currently payable for the same employment position
or an employment position substantially similar to the one the person held as of the date of the
disability, whichever is greater. The disability benefit must be reduced to that amount which,
when added to the workers' compensation benefits, does not exceed the greater of the salaries
described in clauses (1) and (2).
    Subd. 2a. Reduction restored; overpayment. A disabled member who is eligible to receive
a disability benefit under subdivision 2 as of June 30, 1987, and whose disability benefit amount
had been reduced prior to July 1, 1987, as a result of the receipt of workers' compensation benefits,
must have the disability benefit payment amount restored, as of July 1, 1987, calculated in
accordance with subdivision 2. However, a disabled member is not entitled to receive retroactive
repayment of any disability benefit amounts lost before July 1, 1987, as a result of the reduction
required before that date because of the receipt of workers' compensation benefits.
Any disability benefit overpayments made before July 1, 1987, and occurring because of
the failure to reduce the disability benefit payment to the extent required because of the receipt
of workers' compensation benefits, may be collected by the association through the reduction of
disability benefit or annuity payment made on or after July 1, 1987, until the overpayment is
fully recovered.
    Subd. 3. Regular disability benefit. (a) A member of the police and fire plan who qualifies
for a regular disability benefit as defined in section 353.01, subdivision 46, is entitled to receive a
disability benefit, after filing a valid application, in an amount equal to 45 percent of the average
salary as defined in section 353.01, subdivision 17a.
    (b) To be eligible for a benefit under paragraph (a), the member must have at least one year
of allowable service credit and have:
    (1) not met the requirements for a retirement annuity under section 353.651, subdivision 1, or
    (2) met the requirements under that subdivision, but does not have at least 15 years of
allowable service credit.
    (c) If paragraph (b), clause (2), applies, the disability benefit must be paid for a period of
60 months from the disability benefit accrual date and, at the end of that period, is subject to
provisions of subdivision 5a.
    (d) For a member who is employed as a full-time firefighter by the Department of Military
Affairs of the state of Minnesota, allowable service as a full-time state Military Affairs
Department firefighter credited by the Minnesota State Retirement System may be used in
meeting the minimum allowable service requirement of this subdivision.
    Subd. 3a. Total and permanent regular disability; computation of benefits. (a) A member
of the police and fire plan whose disabling condition is determined to be a regular disability
under section 353.01, subdivision 46, that is also a permanent and total disability as defined in
section 353.01, subdivision 19, is entitled to receive, for life, a disability benefit in an amount
equal to 45 percent of the average salary as defined in section 353.01, subdivision 17a, plus an
additional percent specified in section 356.315, subdivision 6, of that average salary for each
year of service in excess of 15 years.
    (b) A disability benefit payable under paragraph (a) is subject to eligibility review under
section 353.33, subdivision 6, but the review may be waived if the executive director receives a
written statement from the association's medical advisor that no improvement can be expected in
the member's disabling condition that was the basis for payment of the benefit under paragraph
(a). A member receiving a disability benefit under this subdivision who is found to no longer be
permanently and totally disabled as defined under section 353.01, subdivision 19, but continues
to meet the definition for receipt of a regular disability under section 353.01, subdivision 46, is
subject to subdivision 3 upon written notice from the association's medical advisor that the person
is no longer considered permanently and totally disabled.
    (c) A member approved for disability benefits under this subdivision may elect to receive
a normal disability benefit or an actuarial equivalent optional annuity. If the election of an
actuarial equivalent optional annuity is not made at the time the total and permanent disability
benefit accrues, an election must be made within 90 days before the member attains normal
retirement age as defined in section 353.01, subdivision 37, paragraph (b), or having collected
disability benefits for 60 months, whichever is later. No surviving spouse benefits are payable if
the member dies during the period in which a normal total and permanent disability benefit is
being paid. If a member receiving disability benefits who has dependent children dies, subdivision
6a, paragraph (c), applies.
    Subd. 4. Limitation on disability benefit payments. (a) No member is entitled to receive a
disability benefit payment when there remains to the member's credit unused annual leave, sick
leave, or any other employer-provided salary continuation plan, or under any other circumstances
when, during the period of disability, there has been no impairment of the person's salary as a
police officer, a firefighter, or a paramedic as defined in section 353.64, subdivision 10, whichever
applies.
    (b) If a disabled member resumes a gainful occupation with earnings that, when added to the
normal disability benefit, and workers' compensation benefit if applicable, exceed the disabilitant
reemployment earnings limit, the amount of the disability benefit must be reduced as provided in
this paragraph. The disabilitant reemployment earnings limit is the greater of:
    (1) the salary earned at the date of disability; or
    (2) 125 percent of the base salary currently paid by the employing governmental subdivision
for similar positions.
    (c) The disability benefit must be reduced by one dollar for each three dollars by which the
total amount of the current disability benefit, any workers' compensation benefits if applicable,
and actual earnings exceed the greater disabilitant reemployment earnings limit. In no event may
the disability benefit as adjusted under this subdivision exceed the disability benefit originally
allowed.
    Subd. 5.[Repealed, 2007 c 134 art 4 s 36]
    Subd. 5a. Cessation of disability benefit. (a) The association shall cease the payment of any
disability benefit the first of the month following the reinstatement of a member to full time or
less than full-time service in a position covered by the police and fire fund.
    (b) A disability benefit paid to a disabled member of the police and fire plan, that was granted
under laws in effect after June 30, 2007, terminates at the end of the month in which the member:
    (1) reaches normal retirement age;
    (2) if the disability benefit is payable for a 60-month period as determined under subdivisions
1 and 3, as applicable, the first of the month following the expiration of the 60-month period; or
    (3) if the disabled member so chooses, the end of the month in which the member has elected
to convert to an early retirement annuity under section 353.651, subdivision 4.
    (c) If the police and fire plan member continues to be disabled when the disability benefit
terminates under this subdivision, the member is deemed to be retired. The individual is entitled
to receive a normal retirement annuity or an early retirement annuity under section 353.651,
whichever is applicable, as further specified in paragraph (d) or (e). If the individual did not
previously elect an optional annuity under subdivision 1a, paragraph (a), the individual may elect
an optional annuity under subdivision 1a, paragraph (b).
    (d) A member of the police and fire plan who is receiving a disability benefit under this
section may, upon application, elect to receive an early retirement annuity under section 353.651,
subdivision 4
, at any time after attaining age 50, but must convert to a retirement annuity no later
than the end of the month in which the disabled member attains normal retirement age. An early
retirement annuity elected under this subdivision must be calculated on the disabled member's
accrued years of service and average salary as defined in section 353.01, subdivision 17a, and
when elected, the member is deemed to be retired.
    (e) When an individual's benefit is recalculated as a retirement annuity under this section, the
annuity must be based on clause (1) or clause (2), whichever provides the greater amount:
    (1) the benefit amount at the time of reclassification, including all prior adjustments provided
under section 11A.18; or
    (2) a benefit amount computed on the member's actual years of accrued allowable service
credit and the law in effect at the time the disability benefit first accrued, plus any increases that
would have applied since that date under section 11A.18.
    Subd. 6.[Repealed, 1993 c 307 art 4 s 54]
    Subd. 6a. Disability survivor benefits for pre-July 1, 2007, disabilitants. (a) If a member
who is receiving a disability benefit that was granted under the laws in effect before July 1, 2007,
dies before attaining normal retirement age as defined under section 353.01, subdivision 37,
paragraph (b), or within five years of the effective date of the disability, whichever is later, the
surviving spouse shall receive a survivor benefit under section 353.657, subdivision 2, paragraph
(a), clause (2);
or 2a, unless the surviving spouse elected to receive a refund under section 353.32,
subdivision 1
. The joint and survivor optional annuity under subdivision 2a is based on the
minimum disability benefit under subdivision 1 or 3, or the deceased member's allowable service,
whichever is greater.
    (b) If the disability benefit was granted under the laws in effect before July 1, 2007, and the
disabilitant is living at the age required for receipt of a retirement annuity under section 353.651,
subdivision 1, or five years after the effective date of the disability, whichever is later, the disabled
member may continue to receive a normal disability benefit, or the member may elect a joint and
survivor optional annuity under section 353.30. The optional annuity is based on the minimum
disability benefit under subdivision 1 or 3, or the member's allowable service, whichever is greater.
The election of this joint and survivor annuity must occur within 90 days before attaining normal
retirement age as defined under section 353.01, subdivision 37, paragraph (b), or within 90 days
before the five-year anniversary of the effective date of the disability benefit, whichever is later.
The optional annuity takes effect the first of the month following the month in which the person
attains the age required for receipt of a retirement annuity under section 353.651, subdivision 1, or
reaches the five-year anniversary of the effective date of the disability benefit, whichever is later.
    (c) If any disabled member dies while receiving a benefit and has a dependent child or
children, the association shall grant a dependent child benefit under section 353.657, subdivision 3.
    Subd. 7.[Repealed, 1992 c 432 art 2 s 51]
    Subd. 8. Application procedure to determine eligibility for police and fire plan disability
benefits. The application procedures to determine eligibility for police and fire plan disability
benefits are defined under section 353.031.
    Subd. 9.[Repealed, 2007 c 134 art 4 s 36]
    Subd. 10. Accrual of benefits. (a) Except for a total and permanent disability under
subdivision 1a, a disability benefit begins to accrue when the applicant is no longer receiving
any form of compensation, whether salary or paid leave 90 days preceding the filing of an
application; or, if annual or sick leave, or any other employer-paid salary continuation plan is paid
for more than the 90-day period, from the date on which the payment of salary ceased, whichever
is later. Except for a total and permanent disability under subdivision 1a, no member is entitled
to receive a disability benefit payment when there remains to the member's credit any unused
annual leave, sick leave, or any other employer-paid salary continuation benefit, or under any
other circumstances when, during the period of disability, there has been no impairment of the
person's salary.
    (b) Payment of the disability benefit must not continue beyond the end of the month in
which entitlement has terminated. If the disabilitant dies prior to negotiating the check for the
month in which death occurs, payment must be made to the surviving spouse or, if none, to the
designated beneficiary or, if none, to the estate.
    Subd. 11.[Repealed, 2007 c 134 art 4 s 36]
    Subd. 12.[Repealed, 2007 c 134 art 4 s 36]
    Subd. 13. Chemical dependency limitations to disability benefit eligibility. (a) No benefits
are payable for any disability resulting in whole or in part from the member's current use of illegal
drugs. This exclusion does not apply to a member who:
    (1) has successfully completed a supervised drug rehabilitation program or has otherwise
been rehabilitated successfully and is no longer engaging in such use; or
    (2) is participating in a supervised rehabilitation program and is no longer engaging in
such use.
    (b) "Illegal use of drugs" means the use of drugs, the possession or distribution of which is
unlawful under United States Code, title 21, section 801. "Illegal use of drugs" does not include
the use of a drug taken under the supervision of a licensed health care professional, or other uses
authorized by United States Code, title 21, or other provisions of law.
History: 1971 c 297 s 3; 1973 c 753 s 72-74; 1975 c 102 s 20,21; 1975 c 359 s 23; 1976 c
329 s 28; 1977 c 429 s 63; 1978 c 796 s 38; 1979 c 216 s 19; 1981 c 68 s 23,24; 1981 c 180 s 16;
1981 c 224 s 96; 1983 c 85 s 2; 1Sp1985 c 7 s 15; 1986 c 444; 1987 c 284 art 5 s 14,15; 1987 c
372 art 1 s 7; art 9 s 20,21; 1989 c 319 art 3 s 22; art 17 s 14,15; 1990 c 570 art 11 s 9,10; 1991 c
341 s 23; 1992 c 432 art 2 s 19; 1993 c 307 art 4 s 34-39; 1993 c 352 s 5; 1994 c 463 s 1; 1997 c
233 art 1 s 42; 2000 c 461 art 3 s 23,24; 2002 c 392 art 11 s 52; 2004 c 267 art 8 s 20-25; 1Sp2005
c 8 art 1 s 14; 2006 c 212 art 3 s 35; 2006 c 271 art 3 s 29; art 4 s 1-3; 2007 c 134 art 4 s 15-25
353.657 SURVIVOR BENEFITS.
    Subdivision 1. Generally. (a) In the event that a member of the police and fire fund dies
from any cause before retirement or before becoming disabled and receiving disability benefits,
the association shall grant survivor benefits to a surviving spouse, as defined in section 353.01,
subdivision 20
, and to a dependent child or children, as defined in section 353.01, subdivision 15,
except that if the death is not a line of duty death, the member must have accrued at least three
years of credited service.
    (b) Notwithstanding the definition of surviving spouse, a former spouse of the member, if
any, is entitled to a portion of the monthly surviving spouse benefit if stipulated under the terms of
a marriage dissolution decree filed with the association. If there is no surviving spouse or child or
children, a former spouse may be entitled to a lump-sum refund payment under section 353.32,
subdivision 1
, if provided for in a marriage dissolution decree but not a monthly surviving spouse
benefit despite the terms of a marriage dissolution decree filed with the association.
    (c) The spouse and child or children are entitled to monthly benefits as provided in
subdivisions 2 to 4.
    Subd. 2. Benefit amount. (a) The spouse of a deceased member is entitled to receive a
monthly benefit for life equal to the following percentage of the member's average full-time
monthly salary rate as a member of the police and fire plan in effect over the last six months of
allowable service preceding the month in which death occurred:
    (1) if the death was a line of duty death, 60 percent of the stated average salary is payable; and
    (2) if the death was not a line of duty death or if death occurred while receiving disability
benefits that accrued before July 1, 2007, 50 percent of the stated average salary is payable.
    (b) If the member was a part-time employee in the position for which the employee qualified
for participation in the police and fire plan, the monthly survivor benefit is based on the salary rate
in effect for that member's part-time service during the last six months of allowable service. If
the member's status changed from full time to part time for health reasons during the last year of
employment, the monthly survivor benefit is based on the full-time salary rate of the position held
as a member of the police and fire plan in effect over the last six months of allowable service
preceding the month in which the death occurred.
    Subd. 2a. Death while eligible survivor benefit. (a) If a member or former member who has
attained the age of at least 50 years and has credit for not less than three years allowable service or
who has credit for at least 30 years of allowable service, regardless of age attained, dies before the
annuity or disability benefit becomes payable, notwithstanding any designation of beneficiary to
the contrary, the surviving spouse may elect to receive a death while eligible survivor benefit.
    (b) Notwithstanding the definition of surviving spouse in section 353.01, subdivision 20, a
former spouse of the member, if any, is entitled to a portion of the death while eligible survivor
benefit if stipulated under the terms of a marriage dissolution decree filed with the association. If
there is no surviving spouse or child or children, a former spouse may be entitled to a lump-sum
refund payment under section 353.32, subdivision 1, if provided for in a marriage dissolution
decree but not a death while eligible survivor benefit despite the terms of a marriage dissolution
decree filed with the association.
    (c) The benefit may be elected instead of a refund with interest under section 353.32,
subdivision 1
, or surviving spouse benefits otherwise payable under subdivisions 1 and 2.
The benefit must be an annuity equal to the 100 percent joint and survivor annuity which the
member could have qualified for on the date of death, computed as provided in sections 353.651,
subdivisions 2 and 3
, and 353.30, subdivision 3.
    (d) The surviving spouse may apply for the annuity at any time after the date on which the
deceased employee would have attained the required age for retirement based on the employee's
allowable service. Sections 353.34, subdivision 3, and 353.71, subdivision 2, apply to a deferred
annuity payable under this subdivision.
    (e) No payment accrues beyond the end of the month in which entitlement to such annuity
has terminated. An amount equal to the excess, if any, of the accumulated contributions which
were credited to the account of the deceased employee over and above the total of the annuities
paid and payable to the surviving spouse must be paid to the deceased member's last designated
beneficiary or, if none, to the legal representative of the estate of such deceased member.
    (f) Any member may request in writing that this subdivision not apply and that payment be
made only to the designated beneficiary, as otherwise provided by this chapter.
    (g) For a member who is employed as a full-time firefighter by the Department of Military
Affairs of the state of Minnesota, allowable service as a full-time state Military Affairs
Department firefighter credited by the Minnesota State Retirement System may be used in
meeting the minimum allowable service requirement of this subdivision.
    Subd. 3. Dependent children. A dependent child, as defined in section 353.01, subdivision
15
, is entitled to receive a monthly benefit equal to ten percent of the member's average full-time
monthly salary rate as a member of the police and fire plan in effect over the last six months of
allowable service preceding the month in which death occurred. Payments for the benefit of a
dependent child must be made to the surviving parent, or to the legal guardian of the child or to
any adult person with whom the child may at the time be living, provided only that the parent or
other person to whom any amount is to be paid advises the board in writing that the amount will
be held or used in trust for the benefit of the child.
    Subd. 3a. Maximum and minimum family benefits. (a) The maximum monthly benefit per
family must not exceed the following percentages of the member's average monthly salary as
specified in subdivision 3:
    (1) 80 percent, if the member's death was a line of duty death; or
    (2) 70 percent, if the member's death was not a line of duty death or occurred while the
member was receiving a disability benefit that accrued before July 1, 2007.
    (b) The minimum monthly benefit per family, including the joint and survivor optional
annuity under subdivision 2a, and section 353.656, subdivision 1a, must not be less than the
following percentage of the member's average monthly salary as specified in subdivision 3:
    (1) 60 percent, if the death was a line of duty death; or
    (2) 50 percent, if the death was not a line of duty death or occurred while the member was
receiving a disability benefit that accrued before July 1, 2007.
    (c) If the maximum under paragraph (a) is exceeded, the monthly benefit of the joint
annuitant must be reduced to the amount necessary so that the total family benefit does not
exceed the applicable maximum. The joint and survivor optional annuity must be restored, plus
applicable postretirement adjustments under section 356.41, as the dependent child or children
become no longer dependent under section 353.01, subdivision 15.
    Subd. 4. Relation to workers' compensation law. If the member shall die under
circumstances which entitle a surviving spouse and dependent children to receive benefits under
the workers' compensation law, the amounts so received by them shall not be deducted from the
benefits payable under this section.
History: 1971 c 297 s 4; 1973 c 753 s 75-77; 1974 c 229 s 20; 1975 c 102 s 22; 1975 c 359 s
23; 1978 c 471 s 7; 1978 c 796 s 39; 1980 c 607 art 15 s 3; 1981 c 180 s 17; 1982 c 404 s 9;
1Sp1985 c 7 s 16; 1986 c 444; 1986 c 458 s 13; 1987 c 284 art 5 s 16; 1987 c 372 art 1 s 8; art 9
s 22; 1989 c 319 art 13 s 45; art 17 s 16,17; 1990 c 570 art 11 s 11; 1991 c 269 art 2 s 7; 1991 c
341 s 24; 1992 c 432 art 2 s 20-22; 1Sp2005 c 1 art 4 s 97; 2007 c 134 art 4 s 26-29
353.659 LOCAL RELIEF ASSOCIATION CONSOLIDATION ACCOUNT BENEFITS.
For any person who has prior service covered by a local police or firefighters relief
association which has consolidated with the public employees retirement association and who
has elected the type of benefit coverage provided by the public employees police and fire fund
benefit plan under section 353A.08 following the consolidation, any retirement benefits payable
are governed by the applicable provisions of this chapter. For any person who has prior service
covered by a local police or firefighters relief association which has consolidated with the public
employees retirement association and who has not elected the type of benefit coverage provided
by the public employees police and fire fund benefit plan under section 353A.08 following the
consolidation, any retirement benefits payable are governed by the provisions of sections 353B.01
to 353B.13 which apply to the relief association.
History: 1987 c 296 s 7; 1992 c 432 art 2 s 23
353.66 [Repealed, 1973 c 753 s 85]
353.661 [Repealed, 1989 c 319 art 3 s 26]
353.662 [Repealed, 1989 c 319 art 3 s 26]
353.663 [Repealed, 1Sp2005 c 8 art 10 s 81]
353.665 MERGER OF CERTAIN CONSOLIDATION ACCOUNTS INTO PERA-P&F.
    Subdivision 1. Merger authorized. (a) Notwithstanding any provision of law to the contrary,
unless the applicable municipality elects otherwise under paragraph (b), every local police and
fire consolidation account under chapter 353A in existence on March 1, 1999, becomes a part
of the public employees police and fire plan and fund governed by sections 353.63 to 353.659
on July 1, 1999.
(b) If a municipality desires to retain its consolidation account or consolidation accounts,
whichever applies, the governing body of the municipality must adopt a resolution to that effect
and must file a copy of the resolution with the secretary of state, the state auditor, the legislative
auditor, the finance commissioner, the revenue commissioner, the executive director of the public
employees retirement association, and the executive director of the Legislative Commission on
Pensions and Retirement. The retention election must apply to both consolidation accounts if the
municipality is associated with more than one consolidation account. The retention resolution
must be adopted and filed with all recipients before June 15, 1999.
    Subd. 2. Transfer of liabilities. Unless the municipality has elected to retain the
consolidation account under subdivision 1, paragraph (b), all current and future liabilities of a
former local police or fire consolidation account are the liabilities of the public employees police
and fire fund as of July 1, 1999, and the accrued benefits of the members are the obligation
of the public employees police and fire fund.
    Subd. 3. Transfer of assets. Unless the municipality has elected to retain the consolidation
account under subdivision 1, paragraph (b), the assets of the former local police or fire
consolidation account must be transferred and upon transfer, the actuarial value of the assets of a
former local police or fire consolidation account less an amount equal to the residual assets as
determined under subdivision 7, paragraph (f), are the assets of the public employees police
and fire fund as of July 1, 1999. The participation of a consolidation account in the Minnesota
postretirement investment fund becomes part of the participation of the public employees police
and fire fund in the Minnesota postretirement investment fund. The remaining assets, excluding
the amounts for distribution under subdivision 7, paragraph (f), become an asset of the public
employees police and fire fund. The public employees police and fire fund also must be credited
as an asset with the amount of receivable assets under subdivision 7, paragraph (e).
    Subd. 4. Benefit coverage for active members. (a) A person who is a police officer or a
firefighter who, as such, is an active member of a merging local police or fire consolidation
account on June 30, 1999, and who has not previously elected benefit coverage under the relevant
provisions of the public employees police and fire fund benefit plan under section 353A.08,
subdivision 3
, may elect benefit coverage under the relevant provisions of the public employees
police and fire fund benefit plan. This election must be made in writing on a form prescribed by
the executive director before September 1, 1999, and is irrevocable.
(b) If an eligible person makes no affirmative election of benefit coverage before September
1, 1999, the person retains the benefit coverage provided by the relief association benefit plan as
reflected in the applicable provisions of chapter 353B and may elect benefit coverage under the
relevant provisions of the public employees police and fire fund benefit plan when the person
terminates active employment for purposes of receiving a service pension, disability benefit, or
within 90 days of the date the member terminates active employment and defers receipt of a
service pension, whichever applies.
(c) Notwithstanding any provision of section 353A.083 and any municipal action under
authority of that statute to the contrary, the provisions of the public employees police and fire
fund benefit plan applicable to active members of the merging local police or fire consolidation
accounts who elect the public employees police and fire fund benefit plan under section 353A.08,
subdivision 3
, or paragraph (a), are the applicable provisions of sections 353.63 to 353.659.
    Subd. 5. Benefit coverage for retirees and benefit recipients. (a) A person who received a
service pension, a disability pension or benefit, or a survivor benefit from a merging local police
or fire consolidation account for the month of June 1999, and who has not previously elected
participation in the Minnesota postretirement investment fund for any future postretirement
adjustments rather than the postretirement adjustment mechanism or mechanisms of the relief
association benefit plan under section 353A.08, subdivision 1, may elect participation in the
Minnesota postretirement investment fund for any future postretirement adjustments or retention
of the postretirement adjustment mechanism or mechanisms of the relief association benefit plan
as reflected in the applicable provisions of chapter 353B. This election must be in writing on a
form prescribed by the executive director and must be made before September 1, 1999.
(b) If an eligible person is a minor, the election must be made by the person's parent or legal
guardian. If the eligible person makes no affirmative election under this subdivision, the person
retains the postretirement adjustment mechanism or mechanisms of the relief association benefit
plan as reflected in the applicable provisions of chapter 353B.
(c) The survivor benefit payable on behalf of any service pension or disability benefit
recipient who elects participation in the Minnesota postretirement investment fund must be
calculated under the relief association benefit plan in effect on the effective date of consolidation
under chapter 353A as reflected in the applicable provisions of chapter 353B.
    Subd. 6. Benefit coverage for deferred members. A person who terminated before July
1, 1999, active employment as a police officer or a firefighter that gave rise to membership in a
local relief association that has consolidated with the public employees police and fire plan under
chapter 353A and is merging under this section and who had sufficient service credit to entitle
the person to an eventual service pension retains the benefit plan as reflected in the applicable
provisions of chapter 353B, except that the deferred member may elect before September 1, 1999,
to participate, upon retirement, in the Minnesota postretirement investment fund. Any election to
participate in the Minnesota postretirement investment fund is applicable to any survivor benefit
attributable to a deferred member covered by this subdivision.
    Subd. 7. Calculation of final funded status. (a) As of June 30, 1999, the actuary retained
under section 356.214 shall determine the final funded status of local police and fire consolidation
accounts under chapter 353A that the applicable municipality has not elected to retain under
subdivision 1, paragraph (b), as provided in this subdivision.
(b) The final funded status calculation must be made using the benefit plan provisions
applicable to the consolidation account and the actuarial assumptions used for the June 30, 1998,
actuarial valuation of the account.
(c) The actuary must calculate the total actuarial accrued liability of the consolidation
account, which is the sum of the actuarial accrued liability for all consolidation account members
who are not included in the participation of the account in the Minnesota postretirement
investment fund calculated using the entry age normal actuarial cost method. If local legislation
enacted during the 1999 regular session or any special session occurring before October 1, 1999,
provides a benefit increase for one consolidation account member or more, whether the applicable
municipality has given final approval to the local legislation yet or not, the total actuarial accrued
liability calculation must include that benefit increase. The actuary also must calculate any
account unfunded accrued liability or any account funding surplus. An account unfunded accrued
liability is the actuarial accrued liability reduced by the amount of the current value of assets, if the
resulting number is positive. An account funding surplus is the actuarial accrued liability reduced
by the amount of the current value of assets, if the resulting number is negative. If a municipality
is associated with two consolidation accounts and one has an account funding surplus and one
has an account unfunded accrued liability in the preliminary calculation under this paragraph,
the actuary must make a second calculation for the account with a preliminary account unfunded
accrued liability, after crediting to that account an amount up to 75 percent of the one-half of the
market value of the assets of the account with an account funding surplus that are in excess of 100
percent of the account actuarial accrued liability and that are less than that percentage of the total
actuarial accrued liability that equals the public employees police and fire fund funded ratio as of
June 30, 1999, but not to exceed the account's unfunded actuarial accrued liability.
(d) The actuary also must calculate the amortizable base for every consolidation account.
The amortizable base is the present value of future benefits for all account members who are not
included in the participation of the account in the Minnesota postretirement investment fund
reduced by the present value of 19 percent of future covered salary and further reduced by the
current value of account assets other than its participation in the Minnesota postretirement
investment fund, after adjustment for fiscal year 1999 net mortality gains and losses and for the
net actuarial affect of the election of postretirement adjustment coverage under subdivision 5.
(e) If the amortizable base under paragraph (d) is a positive number, the receivable assets are
an amount equal to the amortizable base number.
(f) If the amortizable base under paragraph (d) is a negative number, the actuary must
calculate the residual asset amount. The residual asset amount is:
(1) one-half of the amount by which the current assets of the account exceed 100 percent of
the total actuarial accrued liability up to that percentage of the total actuarial accrued liability that
equals the public employees police and fire fund funded ratio on June 30, 1999; and
(2) the amount by which the current assets of the account exceed that percentage of the total
actuarial accrued liability that equals the public employees police and fire fund funded ratio
on June 30, 1999. Following the calculation of the residual asset amount for each applicable
municipality and the verification of the amount by the legislative auditor, the executive director of
the public employees retirement association shall pay the applicable residual asset amount with
interest equal to the average yield on the invested treasurer's cash fund from July 1, 1999, to the
first of the month in which the payment is issued to each qualifying municipality. The residual
asset amount must be used by the municipality to defray fire department expenditure items if
the residual asset amount was derived from a fire consolidation account or to defray police
department expenditure items if the residual asset amount was derived from a police consolidation
account. Before the residual asset amount payment is made by the Public Employees Retirement
Association, the governing body of the applicable municipality, following a public hearing on the
issue, must formulate and adopt a plan for the expenditure of the residual amount and must file
that plan in the form of a municipal resolution with the state auditor. The residual asset amount
must be deposited in a special fund or account in the municipal treasury established for that
purpose. The special fund or account must be invested and any investment return attributable to
the residual asset amount must be credited to that special fund or account and its disbursement
similarly restricted. The special fund or account must be audited periodically by the state auditor.
    Subd. 8. Member and employer contributions. (a) Effective on the first day of the first
full pay period following June 30, 1999, the employee contribution rate for merging former
consolidation account active members is the rate specified in section 353.65, subdivision 2, and
the regular municipal contribution rate on behalf of former consolidation account active members
is the rate specified in section 353.65, subdivision 3.
(b) The municipality associated with a merging former local consolidation account that
had a positive value amortizable base calculation under subdivision 7, paragraph (d), after the
preliminary calculation or the second calculation, whichever applies, must make an additional
municipal contribution to the public employees police and fire plan for the period from January 1,
2000, to December 31, 2009. The amount of the additional municipal contribution is the amount
calculated by the actuary retained under section 356.214 and certified by the executive director
of the Public Employees Retirement Association by which the amortizable base amount would
be amortized on a level dollar annual end-of-the-year contribution basis, using an 8.5 percent
interest rate assumption. The additional municipal contribution is payable during the month
of January, is without any interest, or if made after January 31, but before the next following
December 31, is payable with interest for the period since January 1 at a rate which is equal to
the preretirement interest rate assumption specified in section 356.215, subdivision 8, applicable
to the public employees police and fire fund expressed as a monthly rate and compounded on
a monthly basis or if made after December 31 of the year in which the additional municipal
contribution is due is payable with interest at a rate which is four percent greater than the highest
interest rate assumption specified in section 356.215, subdivision 8, expressed as a monthly
rate and compounded monthly from January 1 of the year in which the additional municipal
contribution is due until the date on which payment is made.
    Subd. 9. Benefit plan coverage. Unless modified by an election authorized under subdivision
4, 5, or 6, the benefit plan election by any person or on behalf of any person under section
353A.08 remains binding. Merging former consolidation account members who elected the
entirety of the public employees police and fire benefit plan are entitled to an applicable annuity
or benefit under the provisions of sections 353.63 to 353.68 in effect on the day that the merging
former consolidation account member terminated active service as a police officer or firefighter,
whichever applies.
    Subd. 10. Consolidation account termination. Unless the municipality has elected to retain
the consolidation account under subdivision 1, paragraph (b), upon the payment of all residual
asset amounts under subdivision 7 and the transfer of all liabilities and remaining assets under
subdivisions 2 and 3, the local consolidation accounts under chapter 353A in existence on March
1, 1999, are terminated, and all benefits accrued up to the date of termination are the obligation
of the public employees police and fire fund.
History: 1999 c 222 art 4 s 10; 2002 c 392 art 11 s 52; 2006 c 271 art 3 s 47
353.666 PAST SERVICE CREDIT FOR CERTAIN MEMBERS EXTENDED COVERAGE.
(a) A member to whom public employees police and fire retirement plan membership was
extended under section 353.64, subdivision 11, may receive retroactive service credit in the public
employees police and fire retirement plan for service as a tribal police officer rendered before
the effective date of membership of the tribal police department employee in the police and fire
fund, provided that the employee and the police department did not make contributions into a
qualified tax-deferred retirement plan for that employment period.
(b) The request for retroactive coverage must be in writing and must be filed with the
association within 60 days of when police and fire fund membership commenced. The prior
service credit purchase payment is governed by section 356.551, except that the member must
pay an amount equal to the employee salary deductions. The employee salary deductions for the
retroactive period must be based on the police and fire pension plan member contribution rates in
effect when the service was rendered and applied to the salary amount that was earned and paid to
the police officer. The employer must pay the balance of the prior service credit purchase payment
amount within 30 days of the member contribution payment.
History: 2000 c 461 art 7 s 3; 2005 c 10 art 5 s 4
353.67 APPLICATION FOR ANNUITY.
Application for retirement annuity may be made by a member or by someone authorized to
act in behalf of the member.
History: 1959 c 650 s 35; 1965 c 880 s 9; 1986 c 444
353.68 SCOPE AND APPLICATION.
    Subdivision 1. Application. The general provisions of this chapter apply to all police
officers and firefighters who are members of the police and fire fund and also to all governmental
subdivisions employing such members except where otherwise specifically provided in sections
353.63 to 353.68.
    Subd. 2.[Repealed, 1973 c 753 s 85]
    Subd. 3.[Repealed, 1973 c 753 s 85]
    Subd. 4. Deferred annuity. The deferred annuity of section 353.34, subdivision 3, as it
applies to members of the police and fire fund, begins and is computed in the manner provided in
section 353.651 on the basis of the law in effect on the date of termination of public service. The
deferred annuity is augmented under section 353.71, subdivision 2.
    Subd. 5.[Repealed, 1973 c 753 s 85]
    Subd. 6.[Repealed, 1973 c 753 s 85]
    Subd. 7.[Repealed, 1973 c 753 s 85]
    Subd. 8.[Repealed, 1973 c 753 s 85]
    Subd. 9.[Repealed, 1973 c 753 s 85]
History: 1959 c 650 s 36; 1961 c 743 s 3; 1963 c 639 s 2; 1963 c 641 s 35-37; 1963 c 659 s
1; 1965 c 814 s 2; Ex1967 c 37 s 4; 1969 c 940 s 15; 1971 c 412 s 3; 1973 c 753 s 78; 1992 c
432 art 2 s 24
353.69 [Repealed, 2007 c 134 art 2 s 50]
353.70 [Repealed, 1963 c 641 s 38]
353.71 COVERAGE BY MORE THAN ONE RETIREMENT SYSTEM; DEFERRED
ANNUITY; AUGMENTATION.
    Subdivision 1. Eligibility. Any person who has been a member of the Public Employees
Retirement Association, or the Minnesota State Retirement System, or the Teachers Retirement
Association, or any other public retirement system in the state of Minnesota having a like
provision, except a fund providing benefits for police officers or firefighters governed by sections
69.77 or 69.771 to 69.776, shall be entitled when qualified to an annuity from each fund if the total
allowable service in all funds or in any two of these funds totals three or more years, provided no
portion of the allowable service upon which the retirement annuity from one fund is based is again
used in the computation for benefits from another fund and provided further that the person has
not taken a refund from any one of these funds since the person's membership in that association
or system last terminated. The annuity from each fund shall be determined by the appropriate
provisions of the law except that the requirement that a person must have at least three years of
allowable service in the respective association or system shall not apply for the purposes of this
section provided the combined service in two or more of these funds equals three or more years.
    Subd. 2. Deferred annuity computation; augmentation. (a) The deferred annuity accruing
under subdivision 1, or under sections 353.34, subdivision 3, and 353.68, subdivision 4, must
be computed on the basis of allowable service prior to the termination of public service and
augmented as provided in this paragraph. The required reserves applicable to a deferred annuity,
or to any deferred segment of an annuity must be determined as of the first day of the month
following the month in which the former member ceased to be a public employee, or July 1, 1971,
whichever is later. These required reserves must be augmented at the rate of five percent annually
compounded annually until January 1, 1981, and at the rate of three percent thereafter until
January 1 of the year following the year in which the former member attains age 55 and from
that date to the effective date of retirement, the rate is five percent compounded annually if the
employee became an employee before July 1, 2006, and at 2.5 percent compounded annually if
the employee becomes an employee after June 30, 2006. If a person has more than one period of
uninterrupted service, the required reserves related to each period must be augmented as specified
in this paragraph. The sum of the augmented required reserves is the present value of the annuity.
Uninterrupted service for the purpose of this subdivision means periods of covered employment
during which the employee has not been separated from public service for more than two years. If
a person repays a refund, the restored service must be considered as continuous with the next
period of service for which the employee has credit with this association. This section must not
reduce the annuity otherwise payable under this chapter. This paragraph applies to individuals
who become deferred annuitants on or after July 1, 1971. For a member who became a deferred
annuitant before July 1, 1971, the paragraph applies from July 1, 1971, if the former active
member applies for an annuity after July 1, 1973.
(b) The retirement annuity or disability benefit of, or the survivor benefit payable on behalf
of, a former member who terminated service before July 1, 1997, or the survivor benefit payable
on behalf of a basic or police and fire member who was receiving disability benefits before July 1,
1997, which is first payable after June 30, 1997, must be increased on an actuarial equivalent
basis to reflect the change in the postretirement interest rate actuarial assumption under section
356.215, subdivision 8, from five percent to six percent under a calculation procedure and tables
adopted by the board and approved by the actuary retained under section 356.214.
    Subd. 3.[Repealed, 1992 c 432 art 2 s 51]
    Subd. 4. Repayment of refund. Any person who has received a refund from the public
employees retirement fund and who is a member of any public retirement system referred to in
subdivision 1, may repay such refund to the public employees retirement fund as provided in
section 353.35.
    Subd. 5. Early retirement. The requirements and provisions for retirement prior to
normal retirement age contained in section 353.30, shall also apply to a person fulfilling such
requirements with a combination of service as provided in subdivision 1.
History: 1963 c 641 s 2; 1969 c 940 s 16-18; 1971 c 412 s 4-7; 1973 c 35 s 58; 1973
c 753 s 80,82,83; 1974 c 229 s 21; 1975 c 102 s 23; 1977 c 429 s 63; 1978 c 796 s 40; 1979 c
216 s 20; 1981 c 224 s 97; 1Sp1981 c 4 art 1 s 165; 1987 c 372 art 9 s 23; 1989 c 319 art 13 s
46-48; 1997 c 233 art 1 s 43; 2000 c 461 art 3 s 25; 2002 c 392 art 11 s 52; 2006 c 277 art 2
s 5; 2006 c 271 art 3 s 47
353.74 [Repealed, 1Sp2005 c 8 art 10 s 81]
353.75 [Repealed, 1Sp2005 c 8 art 10 s 81]
353.76 [Special]
353.77 [Special]
353.78 [Special]
353.79 [Special]
353.80 [Special]
353.81 [Special]
353.82 [Special]
353.83 ADDITIONAL PAYMENTS TO CERTAIN ANNUITANTS.
Payments of retirement annuities pursuant to this chapter, to annuitants who (a) retired prior
to July 1, 1962, (b) had at least 20 years of allowable service credit in the Public Employees
Retirement Association upon their termination of public employment, and (c) receive annuities
of less than $200 per month must, retroactive to July 1, 1967, be supplemented by additional
payments of $15 per month from the Public Employees Retirement Association, if the annuitants
have not previously qualified for the additional payments under this section, and the annuities
plus the additional payments do not exceed $200 per month. These additional payments must
be made in the same manner and at the same time retirement annuities are paid and must be
included in the warrants on which the annuities are so paid. The additional payments are to be
added to and considered a portion of the annuity otherwise payable to the recipient and must be
included in the computation of any monthly survivor benefit or optional annuity which may
become due and payable to any person following the death of an annuitant who, during life,
received a benefit under this section. If an annuitant entitled to receive additional payment under
this section dies before retroactive payment is received, payment must be made upon demand to
the designated beneficiary in an amount equal to the accumulated benefit from July 1, 1967, to
the date of death, without interest.
History: 1967 c 688 s 1; 1969 c 399 s 1; 1969 c 998 s 1; 1980 c 614 s 141; 1986 c 444;
1990 c 570 art 11 s 12
353.84 INCREASE IN BENEFITS.
All survivors and disabilitants who were receiving benefits on June 30, 1973, shall receive
from the appropriate special fund, a 25 percent increase in such benefits accruing from January 1,
1974; provided, that survivors of members who died prior to July 1, 1973 and will not become
eligible to receive benefits until after June 30, 1973, shall receive the 25 percent increase in such
benefits when the benefits begin to accrue. Such increases shall not be affected by any maximum
limitations otherwise provided in this chapter.
Increases in payments pursuant to this section will be made automatically unless the intended
recipient files written notice with the Public Employees Retirement Association requesting that
the increase shall not be made.
History: 1973 c 753 s 84; 1996 c 305 art 1 s 78
353.85 OPTIONAL BENEFITS TO SURVIVORS OF MEMBERS WHO DIED AFTER
JUNE 15, 1973.
A qualified survivor of a "basic" member or a member of the police and fire fund where such
member died after June 15, 1973 and was entitled to salary or vacation pay after June 30, 1973
shall in lieu of all other association survivor benefits be entitled to the survivor benefits payable
under the law in effect on July 1, 1973.
History: 1974 c 229 s 22
353.86 VOLUNTEER AMBULANCE SERVICE PERSONNEL; PARTICIPATION;
ELECTION; LIMITATION; AND COMPENSATION.
    Subdivision 1. Participation. Volunteer ambulance service personnel, as defined in section
353.01, subdivision 35, who are or become members of and participants in the public employees
retirement fund or the public employees police and fire fund before July 1, 2002, and make
contributions to either of those funds based on compensation for service other than volunteer
ambulance service may elect to participate in that same fund with respect to compensation
received for volunteer ambulance service, provided that the volunteer ambulance service is not
credited to another public or private pension plan including the public employees retirement plan
established by chapter 353D and provided further that the volunteer ambulance service is rendered
for the same governmental unit for which the nonvolunteer ambulance service is rendered.
    Subd. 2. Election. Volunteer ambulance service personnel to whom subdivision 1 applies
may exercise the election authorized under subdivision 1 within the earlier of the one-year
period beginning on July 1, 1989, and extending through June 30, 1990, or the one-year period
commencing on the first day of the first month following the start of employment in a position
covered by the public employees retirement fund or the public employees police and fire fund.
The election must be exercised by filing a written notice on a form prescribed by the executive
director of the association.
    Subd. 3. Limitation. Volunteer ambulance service personnel to whom subdivision 1 applies
who exercise their option in accordance with subdivision 2 and their governmental employers are
not required to pay omitted deductions and contributions under section 353.27, subdivision 12,
for volunteer ambulance service rendered before July 1, 1989.
    Subd. 4. Compensation. Notwithstanding section 353.01, subdivision 10, compensation
received for service rendered by volunteer ambulance service personnel to whom subdivision 1
applies who exercise their option in accordance with subdivision 2 shall be considered salary.
History: 1989 c 319 art 3 s 23; 1Sp2001 c 10 art 11 s 17
353.87 VOLUNTEER FIREFIGHTERS; PARTICIPATION; LIMITATION; AND
REFUND.
    Subdivision 1. Participation. Except as provided in subdivision 2, a volunteer firefighter,
as defined in section 353.01, subdivision 36, who, on June 30, 1989, was a member of, and a
participant in, the public employees retirement fund or the public employees police and fire fund
and was making contributions to either of those funds based, at least in part, on compensation
for services performed as a volunteer firefighter shall continue as a member of, and a participant
in, the public employees retirement fund or the public employees police and fire fund and
compensation for services performed as a volunteer firefighter shall be considered salary.
    Subd. 2. Option. A volunteer firefighter to whom subdivision 1 applies has the option to
terminate membership and future participation in the public employees retirement fund or the
public employees police and fire fund upon filing of a written notice of intention to terminate
participation. Notice must be given on a form prescribed by the executive director of the
association and must be filed in the offices of the association not later than June 30, 1990.
    Subd. 3. Limitation. No volunteer firefighter to whom subdivision 1 applies or the
governmental employer of the volunteer firefighter is required to make back contributions to the
Public Employees Retirement Association for volunteer firefighter services rendered before July
1, 1989, notwithstanding the provisions of section 353.27, subdivision 12.
    Subd. 4. Refund. Upon timely filing of a valid notice of termination of participation in
accordance with subdivision 2, a volunteer firefighter to whom subdivision 1 applies must be
given a refund of all past employee contributions made on account of volunteer firefighter service
with five percent interest compounded annually.
    Subd. 5.[Repealed, 1990 c 570 art 11 s 13]
History: 1989 c 319 art 3 s 24
353.88 PENALTY FOR MEMBERSHIP MISCERTIFICATIONS AND CERTIFICATION
FAILURES.
(a) If the board of trustees of the Public Employees Retirement Association, upon the
recommendation of the executive director, determines that a governmental subdivision has
certified a public employee for membership in the public employees police and fire retirement
plan when the public employee was not eligible for that retirement plan coverage, the public
employee must be covered by the correct retirement plan for subsequent service, the public
employee retains the coverage for the period of the misclassification, and the governmental
subdivision shall pay in a lump sum the difference in the actuarial present value of the retirement
annuities to which the public employee would have been entitled if the public employee was
properly classified. The governmental subdivision payment is payable within 30 days of the
board's determination. If unpaid, it must be collected under section 353.28. The lump sum
payment must be deposited in the public employees retirement fund.
(b) If the executive director of the Public Employees Retirement Association determines that
a governmental subdivision has failed to certify a person for retirement plan membership and
coverage under this chapter, in addition to the procedures under section 353.27, subdivision 4, 9,
10, 11, 12, 12a, or 12b, the director shall charge a fine of $25 for each membership certification
failure.
History: 1999 c 222 art 14 s 5
353.95 ACCOUNT FOR DULUTH POSTEMPLOYMENT BENEFITS.
    Subdivision 1. Establishment. 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.
    Subd. 2. Definition. 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.
    Subd. 3. Account maintenance and investment. (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.
    (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.
    Subd. 4. Management and termination of account. 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).
    Subd. 5. Status of irrevocable fund. (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.
    (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.
History: 2007 c 14 s 2
NOTE: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. Laws 2007, chapter 14, section 2, the effective date.