2007 Minnesota Statutes

354.06 BOARD OF TRUSTEES; MEMBERSHIP; DUTIES.
    Subdivision 1. Board. The management of the association is vested in a board of eight
trustees known as the board of trustees of the Teachers Retirement Association. It is composed
of the following persons: the commissioner of education, the commissioner of finance, a
representative of the Minnesota School Boards Association, four members of the association
elected by the members of the association, and one retiree elected by the retirees of the
association. The five elected members of the board of trustees must be chosen by ballot in a
manner fixed by the board of trustees of the association. In every odd-numbered year there
shall be elected two members of the association to the board of trustees for terms of four years
commencing on the first of July next succeeding their election. In every other odd-numbered year
one retiree of the association must be elected to the board of trustees for a term of four years
commencing on the first of July next succeeding the election. The filing of candidacy for a retiree
election must include a petition of endorsement signed by at least ten retirees of the association.
Each election must be completed by June first of each succeeding odd-numbered year. In the
case of elective members, any vacancy must be filled by appointment by the remainder of the
board, and the appointee shall serve until the members or retirees of the association at the next
regular election have elected a trustee to serve for the unexpired term caused by the vacancy. No
member or retiree may be appointed by the board, or elected by the members of the association
as a trustee, if the person is not a member or retiree of the association in good standing at the
time of the appointment or election.
    Subd. 1a. Fiduciary duty. It is the duty of the board of trustees and the executive director to
undertake their activities consistent with chapter 356A.
    Subd. 2. President; executive director. The board shall annually elect one of its members
as president. It shall elect an executive director, whose salary shall be as provided by section
15A.0815. The salary of the assistant executive director who shall be in the unclassified service,
shall be set in accordance with section 43A.18, subdivision 3. The executive director shall serve
during the pleasure of the board and be the executive officer of the board, with such duties as the
board shall prescribe. The board shall employ all other clerks and employees necessary to properly
administer the association. The cost and expense of administering the provisions of this chapter
shall be paid by the association. The executive director shall be appointed by the board on the basis
of fitness, experience in the retirement field and leadership ability. The executive director shall
have had at least five years of experience on the administrative staff of a major retirement system.
    Subd. 2a. Duties of executive director. 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 advisor 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 an assistant executive director in the unclassified service and two assistant
executive directors in the classified service with the approval of the board, and appoint such
employees, both permanent and temporary, as are necessary to carry out the provisions of this
chapter;
(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 director's control and under such conditions as the director may prescribe;
(6) with the approval of the board, contract and set the compensation for the services
of an approved actuary, professional management services, and any other consulting services.
These contracts are not subject to the competitive bidding procedure prescribed by chapter 16C.
An 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 must 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 are qualified to contract with the executive director;
(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, under 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, under 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) certify funds available for investment to the State Board of Investment;
(13) with the advice and approval of the board, request the State Board of Investment to sell
securities on determining that funds are needed for the purposes of the association;
(14) prepare and submit biennial and annual budgets to the board and with the approval of
the board submit those budgets to the Department of Finance; and
(15) 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. The executive director may:
(i) reduce all or part of the accrued interest and fines payable by an employing unit
for reporting requirements under section 354.52, based on an evaluation of any extenuating
circumstances of the employing unit;
(ii) assign association employees to conduct field audits of an employing unit to ensure
compliance with the provisions of this chapter; and
(iii) recover overpayments, if not repaid to the association, by suspending or reducing the
payment of a retirement annuity, refund, disability benefit, survivor benefit, or optional annuity
under this chapter until the overpayment, plus interest, has been recovered.
    Subd. 3. Commissioner of finance. The commissioner of finance shall be ex officio treasurer
of the association and the commissioner's general bond to the state shall cover any liabilities for
acts as treasurer of the association. The commissioner shall receive all moneys payable to the
association and pay out the same only upon forms signed by the executive director.
    Subd. 4. Board; expenses. All members of the board shall serve without compensation. A
member shall receive necessary expenses to attend meetings of the board and its committees, and
association functions and presentations authorized by the board. The necessary expenses must
be paid out of the fund. Members of the board shall suffer no loss of compensation from their
employing units by reason of service on or for the association, the board, or any committee
authorized by the board. Necessary expenses may include the salary of any substitute teacher
which the employing unit is required to hire in the absence of the board member. The board may
reimburse the employing unit for the cost of the substitute teacher.
    Subd. 5. Meetings. The board shall meet regularly at its office at such times as it shall
determine. Special meetings may be held at any time at the call of the president of the board or of
any three members thereof.
    Subd. 6. Fiscal year. The fiscal year of the association shall begin on the first day of July of
each year and end on the 30th day of June of the following year.
    Subd. 7. Office. A suitable office shall be provided by the state through the proper officer for
the use of the board and its executive director.
History: (2950-3) 1931 c 406 s 3; 1955 c 361 s 1; Ex1959 c 50 s 5; Ex1961 c 17 s 2,3; 1963
c 585 s 1; 1969 c 485 s 3,4; 1974 c 289 s 9,10; 1975 c 306 s 5; 1977 c 67 s 2,3,13; 1977 c 429 s
36; 1980 c 342 s 9; 1981 c 160 s 1,2; 1981 c 224 s 103; 1982 c 578 art 1 s 5; 1983 c 289 s 114
subd 1; 1983 c 299 s 29; 1984 c 655 art 1 s 92; 1986 c 444; 1987 c 259 s 31; 1987 c 284 art 6 s 3;
1989 c 319 art 8 s 17; 1994 c 528 art 3 s 8,9; 1994 c 632 art 3 s 57; 1995 c 141 art 3 s 9,20;
1Sp1995 c 3 art 16 s 13; 2Sp1997 c 3 s 18; 1998 c 386 art 2 s 88; 1999 c 99 s 18; 1999 c 222 art
9 s 5; 2003 c 112 art 2 s 41; 2003 c 130 s 12; 2004 c 223 s 4