1998 Minnesota Statutes

     422A.101 Preparation of financial requirements of fund; 
  employer contributions. 

    Subdivision 1.    Financial requirements of fund.  Prior 
 to July 31 annually, the retirement board, in consultation with 
 the commission-retained actuary, shall prepare an itemized 
 statement of the financial requirements of the fund for the 
 succeeding fiscal year.  A copy of the statement shall be 
 submitted to the city council, the board of estimate and 
 taxation of the city, the managing board or chief administrative 
 officer of each city owned public utility, improvement project 
 or municipal activity supported in whole or in part by revenues 
 other than real estate taxes, public corporation, or unit of 
 metropolitan government employing members of the fund, the board 
 of special school district No. 1, and the state commissioner of 
 finance prior to July 31 annually.  The statement shall be 
 itemized and shall include the following:  

    (1) an estimate of the administrative expenses of the fund 
 for the following year, including the amount necessary to 
 amortize through June 30, 2020, the annual costs that are 
 determined by the retirement board to be related to investment 
 activities of the deposit accumulation fund other than actual 
 investment transaction amounts; 

    (2) an estimate of the normal cost of the fund expressed as 
 a dollar amount, which shall be determined by applying the 
 normal cost of the fund as reported in the most recent actuarial 
 valuation prepared by the commission-retained actuary and 
 expressed as a percentage of covered payroll to the estimated 
 total covered payroll of all employees covered by the fund for 
 the following year; 

    (3) an estimate of the contribution required to amortize on 
 a level annual dollar basis the unfunded actuarial accrued 
 liability of the fund by June 30, 2020, using an interest rate 
 of six percent compounded annually as reported in the most 
 recent actuarial valuation, prepared by the commission-retained 
 actuary expressed as a dollar amount.  In determining the amount 
 of the unfunded actuarial accrued liability of the fund, all 
 assets other than the assets of the retirement benefit fund 
 shall be valued as current assets as defined under section 
 356.215, subdivision 1, clause (6), and the assets of the 
 retirement benefit fund shall be valued equal to the actuarially 
 determined required reserves for benefits payable from that 
 fund; 

    (4) the amount of any deficiency in the actual amount of 
 any employer contribution provided for in this section when 
 compared to the required contribution amount certified for the 
 previous year, plus interest on the amount at the rate of six 
 percent per annum. 

    Subd. 1a.    City contributions.  Prior to August 31 of 
 each year, the retirement board shall prepare an itemized 
 statement of the financial requirements of the fund payable by 
 the city for the succeeding fiscal year, and a copy of the 
 statement shall be submitted to the board of estimate and 
 taxation and to the city council by September 15.  The financial 
 requirements of the fund payable by the city shall be calculated 
 as follows: 

    (a) a regular employer contribution of an amount equal to 
 the percentage rounded to the nearest two decimal places of the 
 salaries and wages of all employees covered by the retirement 
 fund which equals the difference between the level normal cost 
 plus administrative cost as reported in the annual actuarial 
 valuation prepared by the commission-retained actuary and the 
 employee contributions provided for in section 422A.10 less any 
 amounts contributed toward the payment of the balance of the 
 normal cost not paid by employee contributions by any city owned 
 public utility, improvement project, other municipal activities 
 supported in whole or in part by revenues other than real estate 
 taxes, any public corporation, any employing unit of 
 metropolitan government, or by special school district No. 1 
 pursuant to subdivision 2; 

    (b) an additional employer contribution of an amount equal 
 to the percent specified in section 353.27, subdivision 3a, 
 clause (a), multiplied by the salaries and wages of all 
 employees covered by the retirement fund less any amounts 
 contributed toward amortization of the unfunded actuarial 
 accrued liability by June 30, 2020, attributable to their 
 respective covered employees by any city owned public utility, 
 improvement project, other municipal activities supported in 
 whole or in part by revenues other than real estate taxes, any 
 public corporation, any employing unit of metropolitan 
 government, or by special school district No. 1 pursuant to 
 subdivision 2; and 

    (c) a proportional share of an additional employer 
 amortization contribution of an amount equal to $3,900,000 
 annually until June 30, 2020, based upon the share of the fund's 
 unfunded actuarial accrued liability attributed to the city as 
 disclosed in the annual actuarial valuation prepared by the 
 commission-retained actuary.  

    The city council shall, in addition to other taxes levied 
 by the city, annually levy a tax equal to the amount of the 
 financial requirements of the fund which are payable by the 
 city.  The tax, when levied, shall be extended upon the county 
 lists and shall be collected and enforced in the same manner as 
 other taxes levied by the city.  If the city does not levy a tax 
 sufficient to meet the requirements of this subdivision, the 
 retirement board shall submit the tax levy statement directly to 
 the county auditor, who shall levy the tax.  The tax, when 
 levied, shall be extended upon the county lists and shall be 
 collected and paid into the city treasury to the credit of the 
 retirement fund.  Any amount to the credit of the retirement 
 fund shall constitute a special fund and shall be used only for 
 the payment of obligations authorized pursuant to this chapter.  

    Subd. 2.    Contributions by or for city-owned public 
 utilities, improvements, or municipal activities.  
 Contributions by or for any city-owned public utility, 
 improvement project, and other municipal activities supported in 
 whole or in part by revenues other than real estate taxes, any 
 public corporation, any employing unit of metropolitan 
 government, special school district No. 1, or Hennepin county, 
 on account of any employee covered by the fund, shall be 
 calculated as follows: 

    (a) a regular employer contribution of an amount equal to 
 the percentage rounded to the nearest two decimal places of the 
 salaries and wages of all employees of the employing unit 
 covered by the retirement fund which equals the difference 
 between the level normal cost plus administrative cost reported 
 in the annual actuarial valuation prepared by the 
 commission-retained actuary and the employee contributions 
 provided for in section 422A.10; 

    (b) an additional employer contribution of an amount equal 
 to the percent specified in section 353.27, subdivision 3a, 
 clause (a), multiplied by the salaries and wages of all 
 employees of the employing unit covered by the retirement fund; 

    (c) a proportional share of an additional employer 
 amortization contribution of an amount equal to $3,900,000 
 annually until June 30, 2020, based upon the share of the fund's 
 unfunded actuarial accrued liability attributed to the employer 
 as disclosed in the annual actuarial valuation prepared by the 
 commission-retained actuary. 

    The city council or any board or commission may, by proper 
 action, provide for the inclusion of the cost of the retirement 
 contributions for employees of any city-owned public utility or 
 for persons employed in any improvement project or other 
 municipal activity supported in whole or in part by revenues 
 other than taxes who are covered by the retirement fund in the 
 cost of operating the utility, improvement project, or municipal 
 activity.  The cost of retirement contributions for these 
 employees shall be determined by the retirement board and the 
 respective governing bodies having jurisdiction over the 
 financing of these operating costs.  

    The cost of the employer contributions on behalf of 
 employees of special school district No. 1 who are covered by 
 the retirement fund shall be the obligation of the school 
 district.  Contributions by the school district to the 
 retirement fund or any other public pension or retirement fund 
 of which its employees are members must be remitted to the fund 
 each month.  An amount due and not transmitted begins to accrue 
 interest at the rate of six percent compounded annually 15 days 
 after the date due.  The retirement board shall prepare an 
 itemized statement of the financial requirements of the fund 
 payable by the school district, which shall be submitted prior 
 to September 15.  Contributions by the school district shall be 
 made at times designated by the retirement board.  The school 
 district may levy for its contribution to the retirement fund 
 only to the extent permitted pursuant to section 126C.41, 
 subdivision 3.  

    The cost of the employer contributions on behalf of 
 elective officers or other employees of Hennepin county who are 
 covered by the retirement fund pursuant to section 422A.09, 
 subdivision 3, clause (2), 422A.22, subdivision 2, or 488A.115, 
 or Laws 1973, chapter 380, section 3, Laws 1975, chapter 402, 
 section 2, or any other applicable law shall be the obligation 
 of Hennepin county.  The retirement board shall prepare an 
 itemized statement of the financial requirements of the fund 
 payable by Hennepin county, which shall be submitted prior to 
 September 15.  Contributions by Hennepin county shall be made at 
 times designated by the retirement board.  Hennepin county may 
 levy for its contribution to the retirement fund. 

    Subd. 2a.    Contributions by metropolitan airports 
 commission and metropolitan council.  The metropolitan 
 airports commission and the metropolitan council shall pay to 
 the Minneapolis employees retirement fund annually in 
 installments as specified in subdivision 3 the share of the 
 additional support rate required for full amortization of the 
 unfunded actuarial accrued liabilities by June 30, 2020, that is 
 attributable to employees of the airports commission or former 
 metropolitan waste control commission who are members of the 
 fund.  The amount of the payment shall be determined as if the 
 airport commission and metropolitan council's employer 
 contributions determined under subdivision 2 had also included a 
 proportionate share of a $1,000,000 annual employer amortization 
 contribution.  The amount of this $1,000,000 annual employer 
 amortization contribution that would have been allocated to the 
 commission or council would have been based on the share of the 
 fund's unfunded actuarial accrued liability attributed to the 
 commission or council compared to the total unfunded actuarial 
 accrued liability attributed to all employers under subdivisions 
 1a and 2.  The determinations required under this subdivision 
 must be based on the most recent actuarial valuation prepared by 
 the actuary retained by the legislative commission on pensions 
 and retirement. 

    Subd. 3.    State contributions.  (a) Subject to the 
 limitation set forth in paragraph (c), the state shall pay to 
 the Minneapolis employees retirement fund annually an amount 
 equal to the amount calculated under paragraph (b). 

    (b) The payment amount is an amount equal to the financial 
 requirements of the Minneapolis employees retirement fund 
 reported in the actuarial valuation of the fund prepared by the 
 commission-retained actuary pursuant to section 356.215 for the 
 most recent year but based on a target date for full 
 amortization of the unfunded actuarial accrued liabilities by 
 June 30, 2020, less the amount of employee contributions 
 required pursuant to section 422A.10, and the amount of employer 
 contributions required pursuant to subdivisions 1a, 2, and 2a.  
 Payments shall be made in four equal installments, occurring on 
 March 15, July 15, September 15, and November 15 annually.  

    (c) The annual state contribution under this subdivision 
 may not exceed $10,455,000 through fiscal year 1998 and 
 $9,000,000 beginning in fiscal year 1999, plus the cost of the 
 annual supplemental benefit determined under section 356.865. 

    (d) If the amount determined under paragraph (b) exceeds 
 $11,910,000, the excess must be allocated to and paid to the 
 fund by the employers identified in subdivisions 1a and 2, other 
 than units of metropolitan government.  Each employer's share of 
 the excess is proportionate to the employer's share of the 
 fund's unfunded actuarial accrued liability as disclosed in the 
 annual actuarial valuation prepared by the actuary retained by 
 the legislative commission on pensions and retirement compared 
 to the total unfunded actuarial accrued liability attributed to 
 all employers identified in subdivisions 1a and 2, other than 
 units of metropolitan government.  Payments must be made in 
 equal installments as set forth in paragraph (b).  

    Subd. 4.    Additional employer contribution in certain 
 instances.  If assets in the deposit accumulation fund are 
 insufficient to make a transfer to the retirement benefit fund, 
 the city of Minneapolis shall pay the amount of that 
 insufficiency to the retirement benefit fund within three days 
 of certification of the insufficiency by the executive director 
 of the fund.  The city of Minneapolis may bill any other 
 participating employing unit other than the state for its 
 proportion of the amount paid. 

    HIST: 1979 c 303 art 6 s 9; 1980 c 614 s 148; 1981 c 224 s 
 186; 1981 c 298 s 11; 1Sp1981 c 1 art 10 s 22; 1985 c 248 s 58; 
 1Sp1985 c 13 s 331,332; 1987 c 259 s 70; 1988 c 718 art 7 s 56; 
 1989 c 329 art 9 s 28; 1991 c 130 s 37; 1991 c 345 art 4 s 10; 
 1992 c 480 s 1; 1992 c 499 art 12 s 29; 1993 c 307 art 10 s 5; 
 1994 c 628 art 3 s 34; 1997 c 202 art 2 s 48; 1998 c 397 art 11 
 s 3