Minnesota Legislature
Office of the Revisor of Statutes
Minnesota Session Laws - 1988, Regular Session
Key: (1) language to be deleted (2) new language
Laws of Minnesota 1988
CHAPTER 709-H.F.No. 2477
An act relating to retirement; making technical
changes in the laws governing the teachers retirement
association and the public employees retirement
association; including certain county historical
society employees in the membership of the public
employees retirement association; authorizing certain
persons to purchase prior service; excluding certain
metropolitan transit commission employees from
additional disability and survivorship coverage;
regulating volunteer firefighters annuity contracts;
authorizing changes in certain local police and
firefighters relief associations; authorizing optional
Medicare coverage for certain public employees;
providing for a special referendum; amending certain
mandatory retirement age provisions; clarifying
eligibility of local elected officials for
participation in a deferred compensation program;
amending vesting provisions for judges; permitting the
payment of certain state aids to the city of Winona;
making technical changes in the laws governing the
judges retirement plan; establishing an individual
retirement account plan for state university and
community college faculty; amending Minnesota Statutes
1986, sections 353.01, subdivisions 15, 29, and by
adding a subdivision; 353.028, subdivision 2; 353.03,
subdivision 1; 353.27, subdivisions 7, 13, and by
adding subdivisions; 353.32, subdivision 5; 353.33,
subdivision 7; 353.37, subdivision 1; 353.65,
subdivision 2; 354.05, by adding a subdivision;
356.24; 424A.02, by adding subdivisions; 471.61,
subdivision 1; 473.418; 490.123, subdivision 1;
490.124, subdivision 2; and 490.129; Minnesota
Statutes 1987 Supplement, sections 136.82, subdivision
1; 352.85, subdivisions 1 and 2; 353.01, subdivisions
2a, 2b, 10, 16, and 20; 353.27, subdivisions 10 and
12; 353.29, subdivision 6; 353.32, subdivision 1a;
353.34, subdivision 3; 353A.10, subdivision 3;
353C.02; 353C.03; 353C.04; 353C.05; 353C.06,
subdivisions 1, 3, and 4; 353C.07; 353C.08,
subdivision 5 and by adding a subdivision; 353D.05,
subdivision 2; 353D.07, subdivisions 1, 2, and 4;
353D.08; 356.302, subdivisions 1 and 3; and 490.124,
subdivision 11; Laws 1955, chapter 151, section 9,
subdivision 7, as amended; Laws 1986, chapter 359,
section 25; Laws 1987, chapter 372, article 2, section
16; proposing coding for new law in Minnesota
Statutes, chapters 60A; 355; and 356; proposing coding
for new law as Minnesota Statutes, chapter 354B;
repealing Minnesota Statutes 1987 Supplement, section
353D.07, subdivision 5.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:
ARTICLE 1
TEACHERS RETIREMENT ASSOCIATION
Section 1. Minnesota Statutes 1987 Supplement, section
136.82, subdivision 1, is amended to read:
Subdivision 1. [GENERALLY.] (a) The executive director of
the teachers retirement fund shall redeem shares in the accounts
of the Minnesota supplemental retirement investment fund
standing in an employee's share account record under the
following circumstances, but always in accordance with the laws
and rules governing the Minnesota supplemental retirement
investment fund:
(1) (b) The executive director shall redeem shares under
this subdivision when requested to do so in writing on forms
provided by the executive director of the teachers retirement
fund by a person having shares to the credit of the employee's
share account record, if the person is age 55 years of age or
older and is no longer employed by the state university board or
state board for community colleges. In such case the
person shall must receive the cash realized on the redemption of
the shares. The person may direct the redemption of not more
than 20 percent of the person's shares in the employee's share
account record in any one year and may not direct more than one
redemption in any one calendar month; provided, however, that
the state university board or its designee, in the case of a
person employed by the state university board, and the state
board for community colleges or its designee, in the case of a
person employed by the state board for community colleges, may,
upon application, in at their sole discretion, permit greater
withdrawals in any one year.
(2) (c) The executive director shall redeem shares under
this subdivision when requested to do so in writing, on forms
provided by the executive director of the teachers retirement
fund, by a person having shares to the credit of the employee's
share account record, if the person has left employment by the
state university board or state board for community colleges
because of a total and permanent disability as defined in
section 354.05, subdivision 14, and. If the executive director
of the teachers retirement fund finds that the person is totally
and permanently disabled and will as a result be unable to
return to similar employment, the person shall must receive the
cash realized on the redemption of the shares. The person may
direct the redemption of not more than 20 percent of the shares
in the employee's share account record in any one year and may
not direct more than one redemption in any one calendar month;
provided, however, that the state university board or its
designee, in the case of a person employed by the state
university board, and the state board for community colleges or
its designee, in the case of a person employed by the state
board for community colleges, may, upon application, in at their
sole discretion, permit greater withdrawals in any one year. If
the person returns to good health, the person shall owe owes no
restitution to the state or any a fund created established by
its laws for a redemption directed pursuant to under this
paragraph.
(3) (d) The executive director shall redeem shares under
this subdivision in the event of the death of a person having
shares to the credit of the employee's share account record and
leaving a surviving spouse, then when requested to do so in
writing, on forms provided by the executive director of the
teachers retirement fund, by the surviving spouse. The
surviving spouse shall must receive the cash realized on the
redemption of the shares. The surviving spouse may direct the
redemption of not more than 20 percent of the shares in the
deceased spouse's employee's share account record in any one
year and may not direct more than one redemption in any one
calendar month; provided, however, that the state university
board or its designee, in the case of a person employed by the
state university board, and the state board for community
colleges or its designee, in the case of a person employed by
the state board for community colleges, may, upon
application, in at their sole discretion, permit greater
withdrawals in any one year. In that case the surviving
spouse shall must receive the cash realized from the redemption
of the shares. Upon the death of the surviving spouse any
shares remaining in the employee's share account record shall
must be redeemed by the executive director of the teachers
retirement fund and the cash realized therefrom from the
redemption must be distributed to the estate of the surviving
spouse.
(4) (e) In the event of the death of a person having shares
to the credit of the employee's share account record and leaving
no surviving spouse, then the executive director of the teachers
retirement fund shall redeem all shares to the credit of the
employee's share account record and pay the cash realized
therefrom from the redemption to the estate of the deceased
person.
(5) (f) The executive director shall redeem shares under
this subdivision when requested to do so in writing, on forms
provided by the executive director of the teachers retirement
fund, by a person having shares to the credit of the employee's
share account record, if the person is no longer employed by the
state university board or state board for community colleges,
but does not qualify under the provisions of paragraphs (1) (b)
to (4) (e). In that case one-half of the cash realized on the
redemption of shares shall must be received by the person and
one-half shall become becomes the property of the supplemental
retirement plan account of the teachers retirement fund.
Annually on July 1 the cancellations of the previous 12
months shall must be prorated among the employees share accounts
in proportion to the value which that each account bears to the
total value of all share accounts.
Sec. 2. [EFFECTIVE DATE.]
Section 1 is effective July 1, 1988.
ARTICLE 2
HISTORICAL SOCIETY EMPLOYEES
Section 1. Minnesota Statutes 1987 Supplement, section
353.01, subdivision 2a, is amended to read:
Subd. 2a. [INCLUDED EMPLOYEES.] The following persons are
included in the meaning of "public employee":
(a) (1) elected or appointed officers and employees of
elected officers.
(b) (2) district court reporters.
(c) (3) officers and employees of the public employees
retirement association.
(d) (4) employees of the league of Minnesota cities.
(e) (5) officers and employees of public hospitals, owned
or operated by, or an integral part of, any a governmental
subdivision or governmental subdivisions.
(f) (6) employees of a school district who receive separate
salaries for driving their own buses.
(g) (7) employees of the association of Minnesota counties.
(h) (8) employees of the metropolitan intercounty
association.
(i) (9) employees of the minnesota Municipal utilities
association.
(j) (10) employees of the metropolitan airports commission
if employment initially commences on or commenced after July 1
June 30, 1979.
(k) (11) employees of the Minneapolis employees retirement
fund, if employment initially commences on or commenced after
July 1 June 30, 1979.
(l) (12) employees of the range association of
municipalities and schools.
(m) (13) employees of the soil and water conservation
districts.
(n) (14) employees of a county historical society who are
county employees.
(o) (15) employees of a county historical society located
in the county whom the county, at its option, certifies to the
executive director to be county employees for purposes of
retirement coverage under this chapter, which status must be
accorded to all similarly situated county historical society
employees and, once established, must continue as long as a
person is an employee of the county historical society and is
not excluded under subdivision 2b.
(16) employees of an economic development authority created
under sections 458C.01 to 458C.23.
(p) (17) employees of the department of military affairs of
the state of Minnesota who are full-time firefighters.
Sec. 2. Minnesota Statutes 1986, section 471.61,
subdivision 1, is amended to read:
Subdivision 1. [OFFICERS, EMPLOYEES.] Any A county,
municipal corporation, town, school district, county extension
committee, other political subdivision or other body corporate
and politic of this state, other than the state or any
department thereof of the state, through its governing body, and
any two or more subdivisions acting jointly through their
governing bodies, may insure or protect its or their officers
and employees, and their dependents, or any class or
classes thereof of officers, employees, or dependents, under a
policy or policies, or contract or contracts of group insurance
or benefits covering life, health, and accident, in the case of
employees, and medical and surgical benefits, and
hospitalization insurance or benefits, for both employees and
dependents, or dependents of an employee whose death was due to
causes arising out of and in the course of employment, or any
one or more of such those forms of insurance or protection. Any
such A governmental unit, including county extension committees
and those paying their employees, may pay all or any part of the
premiums or charges on such the insurance or protection. Any
such A payment shall be is deemed to be additional compensation
paid to such the officers or employees, but for purposes of
determining contributions or benefits under any a public pension
or retirement system it shall is not be deemed to be additional
compensation. Any One or more of such governmental units may
determine that a person is an officer or employee if such
officer or employee the person receives income from such the
governmental subdivisions without regard to the manner of
election or appointment, including but not limited to employees
of county historical societies that receive funding from the
county. The appropriate officer of such the governmental unit,
or those disbursing county extension funds, shall deduct from
the salary or wages of each officer and employee who elects to
become insured or so protected, on the officer's or employee's
written order, all or part of the officer's or employee's share
of such premiums or charges and remit the same share or portion
to the insurer or company issuing such the policy or contract.
Any A governmental unit, other than a school district,
which that pays all or any part of such the premiums or
charges is authorized to levy and collect a tax, if necessary,
in the next annual tax levy for the purpose of providing the
necessary funds money for the payment of such the premiums or
charges, and such the sums so levied and appropriated shall
are not, in the event such the sum exceeds the maximum sum
allowed by any law or the charter of a municipal corporation, be
considered part of the cost of government of such the
governmental unit as defined in any tax levy or per capita
expenditure limitation; provided at least 50 percent of the cost
of benefits on dependents shall must be contributed by the
employee or be paid by levies within existing per capita tax
limitations.
The word "dependents" as used herein shall mean in this
subdivision means spouse and minor unmarried children under the
age of 18 years actually dependent upon the employee.
ARTICLE 3
PURCHASES OF PRIOR SERVICE AND RELATED PROVISIONS
Section 1. [PURCHASES OF PRIOR SERVICE.]
Subdivision 1. [ELIGIBILITY.] The following persons are
eligible to purchase credit for the specified period or periods
of prior service from the indicated retirement fund:
(1) from the public employees retirement association, a
person whose employment with the city of Hibbing began in June
1971, but for whom no salary deductions were taken until June
1973, for the period for which the deductions were omitted;
(2) from the public employees retirement association, a
person who is currently a state employee and who has prior
service as an employee of the Fond du Lac Indian reservation
from July 2, 1973, to December 29, 1980, for that period of
employment by the Fond du Lac Indian reservation for which the
person has not previously received service credit;
(3) from the general state employees retirement fund of the
Minnesota state retirement system, a permanent employee of the
metropolitan sports facilities commission who was an employee of
the metropolitan sports facilities commission on May 17, 1977,
and who was born on January 10, 1930, and began employment by
the commission in 1956 or who was born on November 14, 1937, and
began employment by the commission in 1961, and who did not
exercise an option to purchase the prior service under Minnesota
Statutes, section 473.565, subdivision 3 or 4, for that period
of direct or indirect employment by the commission for which the
person has not previously received service credit;
(4) from the teachers retirement association, a member who
rendered teaching service, as defined in Minnesota Statutes,
section 354.05, before July 1, 1957, and who did not make
contributions for the service because of the limited or
permanent exempt status of the person and optional membership,
for that period of teaching service for which the person has not
previously received service credit;
(5) from the public employees retirement association, a
person employed by a public hospital as defined in Minnesota
Statutes, section 355.71, subdivision 3, who exercised an option
under Laws 1963, chapter 793, section 3, subdivision 5, between
July 1, 1963, and June 30, 1967, to terminate membership in the
coordinated program of the public employees retirement
association and who elects to resume public employees retirement
association coordinated program membership under article 5,
section 40, for all or a portion of the period between the
person's termination of membership and the election to resume
membership;
(6) from the teachers retirement association,
notwithstanding any other law, a person who is currently a
member of the teachers retirement association and who taught at
the University of Minnesota - southern school of agriculture as
a certified science teacher from October 1, 1957, through March
31, 1959, for the period taught at that school, provided the
purchase is initiated before January 1, 1989; and
(7) from the public employees retirement association, a
person who was elected clerk of court for Fillmore county from
1969 to 1976, who was appointed court administrator for Fillmore
county in January 1977, who was discovered in 1985 to have not
had appropriate member and employer contributions made on behalf
of the person, and who retired March 1, 1988, for the period
during calendar years 1979, 1980, and 1981 for which
contributions were omitted, subject to approval by the board of
commissioners of Fillmore county and compliance with section
645.021.
Subd. 2. [PURCHASE PAYMENT AMOUNT.] For a person eligible
to purchase credit for prior service under subdivision 1, there
must be paid to the retirement fund of which the person is a
member an amount equal to the present value, on the date of
payment, of the amount of the additional retirement annuity that
would be obtained by virtue of the purchase of the additional
service credit, using the applicable preretirement interest rate
specified in Minnesota Statutes, section 356.215, subdivision
4d, and the mortality table adopted for the retirement fund and
assuming continuous future service in the retirement fund until,
and retirement at, the age at which the minimum requirements of
the retirement association for normal retirement or retirement
with an annuity unreduced for retirement at an early age,
including Minnesota Statutes, section 356.30, are met with the
additional service credit purchased, and also assuming a future
salary history that includes annual salary increases at the
applicable salary increase rate specified in Minnesota Statutes,
section 356.215, subdivision 4d. The person requesting the
purchase of prior service shall establish in the records of the
retirement fund proof of the service for which the purchase of
prior service is requested. The manner of the proof of service
must be in accordance with procedures prescribed by the
executive director of the retirement fund.
Subd. 3. [PAYMENT; CREDITING SERVICE.] Payment must be
made in one lump sum, unless the executive director of the
retirement fund agrees to accept payment in installments over a
period not to exceed three years from the date of the agreement,
with interest at a rate deemed appropriate by the executive
director. The period of allowable service may be credited to
the account of the person only after receipt of full payment by
the executive director.
Subd. 4. [OPTIONAL EMPLOYER PARTIAL PAYMENT.] Payment must
be made by the person entitled to purchase prior service.
However, the current or former employer of a person specified in
subdivision 1, clause (1), (2), (4), (5), (6), or (7) may, at
its discretion, and the metropolitan sports facilities
commission for a person specified in subdivision 1, clause (3),
shall pay all or any portion of the payment amount that exceeds
an amount equal to the employee contribution rates in effect for
the retirement fund during the period or periods of prior
service applied to the actual salary rates in effect during the
period or periods of prior service, plus interest at the rate of
six percent a year compounded annually from the date on which
the contributions would otherwise have been made to the date on
which the payment is made.
Sec. 2. [EFFECTIVE DATE.]
Section 1 is effective the day following final enactment.
ARTICLE 4
TRANSIT COMMISSION EMPLOYEES
Section 1. Minnesota Statutes 1986, section 473.418, is
amended to read:
473.418 [DISABILITY AND SURVIVORSHIP COVERAGE.]
From and after the effective date of Laws 1978, chapter
538, the metropolitan transit commission shall provide for all
active employees of the transit operating division of the
metropolitan transit commission disability and survivorship
coverage which, when added to the disability benefit or the
survivorship benefit payable from the Minnesota state retirement
system pursuant to sections 352.113 or 352.12, subdivision 2,
will at least equal the disability benefit or the survivorship
benefit which that employee at the time of disability or the
employee's surviving spouse at the time of the death of the
employee while on active duty would have been entitled to
receive under the disability benefit or survivor of active
employee deceased while on active duty benefit provisions of the
metropolitan transit commission-transit operating division
employees retirement fund plan document in effect on December
31, 1977. The metropolitan transit commission shall not be
required to provide any supplementary disability benefit
coverage or benefit amount to replace the amount of any
reduction in any disability payable from the Minnesota state
retirement system due to the receipt of benefits under the
workers' compensation law unless no offset of the amount of
workers' compensation benefits from the amount of a disability
benefit was required pursuant to the provisions of article 10 of
the metropolitan transit commission-transit operating division
employees retirement fund plan document in effect on December
31, 1977. The metropolitan transit commission may elect to
provide the additional disability and survivorship coverage
either through contract with an insurance carrier or through
self insurance. If the commission elects to provide the
coverage through an insurance contract, the chair of the
metropolitan transit commission is authorized to request bids
from, or to negotiate with, insurance carriers and to enter into
contracts with carriers which in the judgment of the commission
are best qualified to underwrite and service this insurance
benefit coverage. The commission shall consider factors such as
the cost of the contracts as well as the service capabilities,
character, financial position and reputation with respect to
carriers under consideration, as well as any other factors which
the commission deems appropriate. The disability and
survivorship insurance contract with the particular insurance
carrier shall be for a uniform term of at least one year, but
may be made automatically renewable from term to term in absence
of notice of termination by either party. The disability and
survivorship insurance contract shall contain a detailed
statement of benefits offered, maximums, limitations and
exclusions. A summary description of the essential terms of the
contract shall be provided by the commission to the labor
organization which is the exclusive bargaining agent
representing employees of the transit operating division of the
metropolitan transit commission and to each active employee of
the transit operating division. The determination of whether
the disability or survivorship insurance coverage meets the
minimum requirements of this section shall be made by the
commission upon consultation with the executive director of the
Minnesota state retirement system. If the disability or
survivorship coverage provided by the metropolitan transit
commission fails at any time after the effective date of Laws
1978, chapter 538 to meet the requirements of this section as to
the level of disability or survivorship coverage to be provided,
the deficiency in the actual benefits provided shall continue to
be an obligation of the commission. Notwithstanding any
provisions of chapter 179 to the contrary, the labor
organization which is the exclusive bargaining agent
representing employees of the transit operating division of the
metropolitan transit commission may meet and bargain with the
commission on an increase in the level of disability or survivor
of active employee deceased while on active duty coverage to be
provided by the commission at the same time that wages and other
terms and conditions of employment are considered. This section
does not apply to employees hired after December 31, 1977.
Sec. 2. [APPLICATION.]
Section 1 applies in the counties of Anoka, Carver, Dakota,
Hennepin, Ramsey, Scott, and Washington.
ARTICLE 5
PUBLIC EMPLOYEES RETIREMENT ASSOCIATION
Section 1. Minnesota Statutes 1987 Supplement, section
353.01, subdivision 2b, is amended to read:
Subd. 2b. [EXCLUDED EMPLOYEES.] (a) The following persons
are excluded from the meaning of "public employee":
(a) (1) persons employed for professional services where
such the service is incidental to regular professional duties.
Service is incidental if, determined on the basis that
compensation for it the service amounts to no more than 25
percent of a the person's total annual gross earnings for all
professional duties.;
(b) (2) election officers.;
(c) (3) independent contractors and their employees.;
(d) (4) patient and inmate help in governmental subdivision
charitable, penal, and correctional institutions.;
(e) (5) members of boards, commissions, bands, and others
who serve the governmental subdivision intermittently.;
(f) (6) employees who hold positions of an essentially
temporary or seasonal character, provided such employment does
not continue for a period in excess of 120 working days in any
calendar year or in any school year for school employees.
Immediately following the expiration of such 120 working days if
such employees continue in public service and earn in excess of
$325 in any one calendar month, the department heads must then
report all such employees for membership and must cause employee
contributions to be made on behalf of such employees in
accordance with section 353.27, subdivision 4, and they shall
remain members until termination of public service. whose
employment is not expected to continue for a period longer than
six consecutive months;
(g) (7) part-time employees who receive monthly
compensation from a governmental subdivision not exceeding
$325 $425, and part-time employees and elected officials whose
annual compensation from a governmental subdivision is
stipulated in advance, in writing, to be not more
than $3,900 $5,100 per calendar year or per school year for
school employees for employment expected to be of a full year's
duration or more than the prorated portion of $3,900 $5,100 per
employment period for employment expected to be of less than a
full year's duration, except that members shall continue their
membership until termination of public service.;
(h) (8) persons who first occupy an elected office after
March 1, 1978 July 1, 1988, the compensation for which does not
exceed $325 $425 per month.;
(i) (9) emergency employees who are employed by reason of
work caused by fire, flood, storm, or similar disaster.;
(j) (10) employees who by virtue of their employment as an
officer or employee of a governmental subdivision are required
by law to be a member of and to contribute to any of the plans
or funds administered by the state employees retirement fund
system, the teachers retirement fund, the state patrol
retirement fund, the Duluth teachers retirement fund
association, the Minneapolis teachers retirement fund
association, the St. Paul teachers retirement fund association,
the Minneapolis employees retirement fund, the Minnesota state
retirement system correctional officers retirement plan, or any
police or firefighters relief association governed by section
69.77 which that has not consolidated with the public employees
police and fire fund and for which the employee has not elected
coverage by the public employees police and fire fund benefit
plan as provided in sections 353A.01 to 353A.10, other than as
an act of the legislature has specifically enabled participation
by employees of a designated governmental subdivision in a plan
supplemental to the public employees retirement association.
This clause shall not prevent a person from being a member of
and contributing to the public employees retirement association
and also belonging to or contributing to another public pension
fund for other service occurring during the same period of time.;
(k) (11) police matrons employed in a police department of
any a city who are transferred to the jurisdiction of a joint
city and county detention and corrections authority.;
(l) (12) persons who 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.;
(m) (13) full-time students who are enrolled and are
regularly attending classes at an accredited school, college, or
university; provided, no person and who are not employed full
time by a governmental subdivision shall be exempt under this
paragraph.;
(n) (14) resident physicians, medical interns, and
pharmacist interns who are serving in public hospitals.;
(o) (15) appointed or elected officers, paid entirely on a
fee basis, and who were not members on June 30, 1971.;
(p) Nothing in Laws 1973, chapter 753 shall be interpreted
to impair or revoke any option exercised under Laws 1963,
chapter 793.
(q) Town, city, or county assessors elected or appointed
pursuant to chapter 273 who do not receive compensation in
excess of $325 per month from any one employing governmental
subdivision or who are employed pursuant to an employment
contract which sets forth the total compensation to be paid and
the length of service, not to exceed three months in duration,
required for the performance of the contract and which was
entered into in advance of the commencement of employment.
(r) (16) persons holding a part-time adult supplementary
vocational technical school license who render part-time
teaching service in a vocational technical school if (1) the
service is incidental to the person's regular nonteaching
occupation; and (2), the applicable vocational technical school
stipulates annually in advance that the part-time teaching
service will not exceed 300 hours in a fiscal year;, and (3) the
part-time teaching service actually does not exceed 300 hours in
a fiscal year.; and
(s) (17) persons exempt from licensure pursuant to under
section 125.031.
(b) Immediately following the expiration of a six-month
period of employment by an employee covered by paragraph (a),
clause (6), if the employee continues in public service and
earns more than $425 from a governmental subdivision in any one
calendar month, the department head shall report the employee
for membership and cause employee contributions to be made on
behalf of the employee in accordance with section 353.27,
subdivision 4, and the employee remains a member until
termination of public service. This paragraph may not be
construed to exclude an employee from membership whose
employment is expected to continue for more than six months but
who is serving a probationary period.
(c) If compensation from a governmental subdivision to an
employee covered by paragraph (a), clause (7), exceeds $5,100
per calendar year or school year after being stipulated in
advance, the stipulation is no longer valid and contributions
must be made on behalf of the employee in accordance with
section 353.27, subdivision 12, from the month in which the
employee first exceeded $425.
(d) Paragraph (a), clause (10), does not prevent a person
from being a member of and contributing to the public employees
retirement association and also belonging to or contributing to
another public pension fund for other service occurring during
the same period of time. A person who meets the definition of
"public employee" in section 353.01, subdivision 2, by virtue of
other service occurring during the same period of time shall
become 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 in
accordance with section 354.05, subdivision 2.
Sec. 2. Minnesota Statutes 1986, section 353.01, is
amended by adding a subdivision to read:
Subd. 2c. [DEFINING OF TERMINATION OF PUBLIC SERVICE.] A
person who terminates employment that was excluded from
membership under subdivision 2b, paragraph (a), clause (6) or
(7), who returns within 30 days to employment in the same
governmental subdivision in another position excluded from
membership under subdivision 2b, paragraph (a), clause (6) or
(7), is considered a member from the beginning of the
reemployment unless the total period covered by all periods of
employment is less than six months or on which the amount earned
does not exceed the dollar limitations in subdivision 2b,
paragraph (a), clause (7).
Sec. 3. Minnesota Statutes 1987 Supplement, section
353.01, subdivision 10, is amended to read:
Subd. 10. [SALARY.] "Salary" means the periodical
compensation of any a public employee, before deductions for
deferred compensation or, supplemental retirement plans, or
other voluntary salary reduction programs, and also means
"wages" and includes net income from fees. Fees paid to
district court reporters shall are not be considered a salary.
Lump sum annual or lump sum sick leave payments and, severance
payments, and all 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,
shall are not be deemed to be salary. Prior to Before the
time that all sick leave has been used, amounts paid to an
employee pursuant to under a disability insurance policy or
program where the employer paid the premiums shall be are
considered salary, and, after all sick leave has been used, the
payment shall is not be considered salary. Workers'
compensation payments shall are not be considered salary.
For any a public employee who has prior service covered by a
local police or firefighters relief association which that has
consolidated with the public employees police and fire fund and
who has elected coverage by the public employees police and fire
fund benefit plan as provided in section 353A.08 following the
consolidation, the term "salary" means the rate of salary upon
which member contributions to the special fund of the relief
association were made prior to the effective date of the
consolidation as specified in the applicable general law,
special by law, and by bylaw provisions governing the relief
association as of on the date of the initiation of the
consolidation procedure and the actual periodical compensation
of the public employee after the effective date of the
consolidation.
Sec. 4. Minnesota Statutes 1986, section 353.01,
subdivision 15, is amended to read:
Subd. 15. [DEPENDENT CHILD.] "Dependent child" means any a
natural or adopted child of a deceased member, provided such
child is (a) under the age of 18, (b) or age 18 through 21 and a
full time student in an accredited school, university, or
college, and in either case unmarried and dependent for more
than one-half of support upon such the member at the time of
death and for not less than 90 days prior thereto before the
time of death; provided, that the child of a deceased member,
who at the time of death was receiving total and permanent
disability benefits pursuant to under section 353.33, shall be
is deemed dependent if dependent upon the decedent for more than
one-half of support during the 90 days prior to before the
decedent's becoming totally and permanently disabled. It
"Dependent child" also includes any a child of the member
conceived during the member's lifetime and born after the
member's death. It also means any 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 aforesaid and in this subdivision. The
dependency of the child hereunder shall date dates from the
decree of adoption. "Dependent child" also includes a child age
18 to 21 who was attending an accredited school, university, or
college full time, 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.
Sec. 5. Minnesota Statutes 1987 Supplement, section
353.01, subdivision 16, is amended to read:
Subd. 16. [ALLOWABLE SERVICE.] (a) "Allowable service"
means: (1) service during years of actual membership in the
course of which employee contributions were currently made;,
periods covered by payments in lieu of salary deductions made as
provided in section 353.35, and 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.
(2) Any (b) "Allowable service" also means a period of
authorized leave of absence with pay from which deductions for
employee contributions are made, deposited, and credited to the
fund.
(3) Any (c) "Allowable service" also means a period of
authorized leave of absence without pay which that does not
exceed one year, and during or for which a member obtained
credit by payments to the fund made in lieu in place of salary
deductions, provided that such the payments are made in an
amount or amounts based on the member's average salary on which
deductions were paid (a) for the last six months of public
service, or (b) for that portion of the last six months while
the member was in public service, to apply to the period in
either case immediately preceding commencement of such the leave
of absence; provided, however, that if the employee elects to
pay employee contributions for the period of any leave of
absence without pay, or for any portion thereof of the leave,
the employee shall also, as a condition to the exercise of such
the election, pay to the fund an amount equivalent to both the
required employer and additional employer
contributions therefor, such for the employee. The payment
to must be made currently or within one year from the date the
leave of absence terminates, unless the. The employer by
appropriate action of its governing body and, made a part of its
official records, prior to before the date of the first payment
of such the employee contribution, certifies may certify to the
association in writing that it will cause to be paid such the
employer and additional employer contributions from the proceeds
of a tax levy made pursuant to under section 353.28. Payments
under this clause shall paragraph must include interest at the
rate of six percent per annum a year from the date of the
termination of the leave of absence to the date payment is made.
(4) Any (d) "Allowable service" also means a period during
which a member is on an authorized sick leave of absence,
without pay limited to one year, or an authorized temporary
layoff.
(5) Any (e) "Allowable service" also means a period during
which a member is on an authorized leave of absence to enter
military service, provided that the member returns to public
service upon discharge from military service pursuant to under
section 192.262, and pays into the fund employee contributions
based upon the employee's salary at the date of return from
military service. After June 30, 1983, Payment must be made
within five years of the date of discharge from the military
service. The amount of these contributions shall must be in
accord with the contribution rates and salary limitations, if
any, in effect during such the leave, plus interest thereon at
six percent per annum a year compounded annually from the date
of return to public service to the date payment is made. In
such cases the matching employer contribution and additional
employer contribution provided in section 353.27, subdivisions 3
and 3a, shall must be paid by the department employing such the
member upon return to public service, and the governmental
subdivision involved is hereby authorized to may appropriate
money therefor for those payments. Such A member shall may
not receive credit for any a voluntary extension of military
service at the instance of the member beyond the initial period
of enlistment, induction, or call to active duty.
(6) (f) 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, Minnesota Statutes
1984, chapter 401, and transferred into county service
under Minnesota Statutes 1984, section 401.04, "allowable
service" means combined years of allowable service as defined in
Minnesota Statutes 1984, section sections 352.01, subdivision
11, and Minnesota Statutes 1984, section 353.01, subdivision 16,
paragraphs (1) to (5).
(7) (g) For any a public employee who has prior service
covered by a local police or firefighters relief
association which that has consolidated with the public
employees police and fire fund, and who has elected coverage by
the public employees police and fire fund benefit plan as
provided in section 353A.08 following the consolidation, any
"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 the applicable
general law, special law, and on bylaw provisions governing the
relief association as of on the date of the initiation of the
consolidation procedure.
Sec. 6. Minnesota Statutes 1987 Supplement, section
353.01, subdivision 20, is amended to read:
Subd. 20. [SURVIVING SPOUSE.] "Surviving spouse" means the
unremarried spouse of a deceased member who had the same legal
residence as was legally married to the member at the time of
death, or at the time the member became totally and permanently
disabled.
Sec. 7. Minnesota Statutes 1986, section 353.01,
subdivision 29, is amended to read:
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.
Sec. 8. Minnesota Statutes 1986, section 353.028,
subdivision 2, is amended to read:
Subd. 2. [ELECTION.] A city manager may elect to be
excluded from membership in the association. The election of
exclusion shall must be made within 30 days six months following
the commencement of employment or within 30 days following May
22, 1981, whichever occurs later, in writing on a form
prescribed by the executive director, and shall must be approved
by a resolution of the governing body of the city. The election
of exclusion shall is not be effective until it is filed with
the executive director. Membership of a city manager in the
association shall cease ceases on the date the written election
is received by the executive director or upon a later date
specified. The election to be excluded from membership shall
must include a provision agreeing that the person will not at
any time in the future seek any authorization to purchase
service credit for any period of excluded service and shall be
is irrevocable. 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.
Sec. 9. Minnesota Statutes 1986, section 353.03,
subdivision 1, is amended to read:
Subdivision 1. [MANAGEMENT; COMPOSITION; ELECTION.] The
management of the public employees retirement fund is vested in
a board of trustees consisting of the state auditor and eight
members. 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 shall be a retired annuitant, and one who is a public member
knowledgeable in pension matters. The membership of the
association shall elect three trustees for terms of four years.
Trustees elected by the membership of the association shall must
be public employees and members of the association. For seven
days beginning November 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
fund. No name may be withdrawn from nomination by the nominee
after November 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 to govern form and length of these
statements, timing of mailings, and deadlines for submitting
materials to be mailed. These policies must be approved by the
secretary of state. The secretary of state shall resolve
disputes between the board and a candidate concerning
application of these policies to a particular statement shall be
resolved by the secretary of state. A candidate who:
(a) (1) receives contributions or makes expenditures in
excess of $100; or
(b) (2) 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, must file a report with the ethical
practices board disclosing the source and amount of all
contributions to the candidate's campaign. The ethical
practices 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 must file a report within 30 days from
the day that the results of the election are announced. The
ethical practices 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. 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 shall be is void. No special marking may be used on
the ballot to indicate incumbents. The last day for mailing
ballots to the fund shall be is January 31. Terms expire on
January 31 of the fourth year, and positions are vacant until
newly elected members are qualified. The ballot envelopes shall
must be so designed and the ballots shall be counted in such a
manner as to insure that ensures that each vote is secret.
The secretary of state shall supervise the elections shall
be supervised by the secretary of state. It shall be the duty
of The board of trustees to shall faithfully administer the law
without prejudice and consistent with the expressed intent of
the legislature. They Board members shall act as trustees with
a fiduciary obligation to the state of Minnesota, which created
the fund, the taxpayers of the governmental subdivisions which
that aid in financing it, and the public employees who are its
beneficiaries. They shall act in good faith and shall exercise
that degree of judgment and care, under circumstances then
prevailing, which that persons of prudence, discretion, and
intelligence exercise in the management of their own affairs.
Sec. 10. Minnesota Statutes 1986, section 353.27,
subdivision 7, is amended to read:
Subd. 7. [ADJUSTMENT FOR ERRONEOUS RECEIPTS OR
DISBURSEMENTS.] (1) (a) [ERRONEOUS DEDUCTIONS.] Any Deductions
taken in error by the employer from the salary of an employee
for the retirement fund and transmitted to the association shall
must be refunded to the employee calculated in accordance with
section 353.34, subdivision 2; and the employer contribution and
the additional employer contribution, if any, for the erroneous
employee contribution shall must be refunded to the employer,
provided, however, that the association and the state social
security agency may make proper adjustments of moneys money
taken as employee and employer deductions, and provided further
that the refund of deductions taken in error has been made
within three calendar years of the calendar year in which the
initial erroneous deduction taken in error was received by the
association. If the refund of deductions taken in error has not
been made within three calendar years of the calendar year in
which the initial erroneous deduction taken in error was
received by the association, the erroneous contributions are
considered valid, and the years of allowable service
attributable to the erroneous deductions must be credited to the
member in accordance with section 353.01, subdivision 16, and,
notwithstanding a law to the contrary, the employee may continue
to be a member until termination of public service.
(2) (b) [ERRONEOUS DISBURSEMENT.] In the event 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 so deducted, or any a portion of it
as that is required to adjust the deductions, shall must be made
to the department or institution.
Sec. 11. Minnesota Statutes 1986, section 353.27, is
amended by adding a subdivision to read:
Subd. 7a. [DEDUCTIONS OR CONTRIBUTIONS TRANSMITTED BY
ERROR.] If employee deductions and employer contributions were
erroneously transmitted to the association, but should have been
transmitted to another public pension fund listed in section
356.30, subdivision 3, the association shall transfer the
erroneous employee deductions and employer contributions to the
appropriate retirement fund without interest. The time
limitations in section 353.27, subdivisions 7 and 12, do not
apply.
Sec. 12. Minnesota Statutes 1987 Supplement, section
353.27, subdivision 10, is amended to read:
Subd. 10. [EMPLOYERS; FURNISH COPIES OF PAYROLL
ABSTRACTS.] The head of each department is required to furnish
the executive director with a carbon or duplicate copy of the
departmental payroll abstracts for the last full pay period
during the months month of March May for school districts and
October December for all other governmental subdivisions,
respectively, in each year. Instead of a duplicate copy of the
payroll abstract, the employer may submit an exception report
listing only those employees who worked the last full pay period
of May or December, but who are not members of the association.
Minimum reporting requirements to be shown on either the payroll
abstract or exception report include: (1) name of the
governmental subdivision and department identification; (2) the
association's assigned unit number and unique code; (3) pay
period coverage dates; (4) any employee deductions; (5) gross
salary for the pay period; (6) each employee's year-to-date
gross pay; and (7) the reason for any exclusion. It shall be
the duty of said The executive director to shall check the
copies of all such payroll abstracts against the membership
records of the association to ascertain whether or not any
omissions have been made by any a department head in the
reporting of any new public employees for membership. The head
of any department shall furnish a carbon or duplicate copy of
the department payroll abstract at the request of the executive
director. The executive director may delegate an association
employee by appointment, in accordance with section 353.03,
subdivision 3a, paragraph (b), clause (5), to conduct a field
audit to review the payroll records of a governmental
subdivision.
Sec. 13. Minnesota Statutes 1987 Supplement, section
353.27, subdivision 12, is amended to read:
Subd. 12. [OMITTED SALARY DEDUCTIONS; OBLIGATIONS.] In the
case of omission of required deductions from salary of an
employee, past due for a period of 60 days or less, the head of
the department shall deduct from the employee's next salary
payment and forthwith remit to the executive director the amount
of the employee contribution delinquency, with cumulative
interest thereon at the rate of six percent per annum a year,
compounded annually, from the date or dates each delinquent
employee contribution was first payable, such. The interest to
must be paid by the employer. To the extent that any such
omitted required deductions are not paid by the employee, they
shall constitute a liability of the governmental subdivision
which failed to make said required deductions, with interest
thereon as hereinbefore specified. After July 1, 1973, any such
Omitted required deductions, past due for a period in excess of
60 days, shall become are the sole obligation of the
governmental subdivision from the time such the deductions were
first payable, together with interest thereon as hereinbefore
specified in this subdivision. Any amount so due, together with
employer and additional employer contributions at the rates and
in the amounts specified in subdivisions 3 and 3a, with interest
thereon at the rate of six percent compounded annually from the
date they were first payable, shall must be paid from the
proceeds of a tax levy made pursuant to under section 353.28, or
from other funds available to the employer. Unless otherwise
indicated, this subdivision shall have has both retroactive and
prospective application, and the governmental subdivision is
liable retroactively and prospectively for all amounts due
hereunder under it. No action for the recovery of delinquent
omitted employee and employer contributions or interest on
contributions may be commenced and no payment of delinquent
omitted contributions may be made or accepted unless the
association has already commenced action for recovery
of delinquent omitted contributions, after the expiration of
three calendar years next following after the calendar year in
which the contributions were omitted. An action for the
recovery of omitted contributions or interest commences five
calendar days after the date of the written correspondence
requesting information from the governmental unit that may lead
to a recovery of omitted contributions.
Sec. 14. Minnesota Statutes 1986, section 353.27, is
amended by adding a subdivision to read:
Subd. 12a. A member who was employed and met the
eligibility requirements for participation in the association
before July 1, 1973, 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
contributions could be withheld from salary, may pay the omitted
employee contributions for the period on which omitted employer
contributions were previously paid plus interest at the rate of
six percent compounded annually. The statute of limitations for
payment of omitted deductions in subdivision 12 applies.
Sec. 15. Minnesota Statutes 1986, section 353.27,
subdivision 13, is amended to read:
Subd. 13. [CERTAIN WARRANTS CANCELED.] Any A warrant
payable from the retirement fund remaining unpaid for a period
of six five years, shall must be canceled into the retirement
fund and not into the general fund.
Sec. 16. Minnesota Statutes 1987 Supplement, section
353.29, subdivision 6, is amended to read:
Subd. 6. [RETIREMENT BEFORE ELIGIBILITY FOR SOCIAL
SECURITY BENEFITS.] Any 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 which that provides for different annuity amounts
over different periods of retirement. The election of this
optional retirement annuity shall must be exercised by making
application to the board of trustees. The optional
annuity shall 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 but equal
insofar as possible to the social security old age retirement
benefit and the adjusted retirement annuity amount payable
immediately after the annuitant becomes eligible for social
security old age retirement benefits in an amount less than the
amount of the annuity calculated under subdivisions 2 and 3 on
the basis of the age of the annuitant at retirement. The social
security leveling option may be calculated based on broad
average social security old age retirement benefits. The
optional annuity shall must be the actuarial equivalent of the
normal retirement annuity computed on the basis of age at
retirement. This greater amount shall must be paid until the
annuitant reaches the age of 62, at which time the payment from
the association shall must be reduced. The board of trustees
shall establish the method of computing the optional retirement
annuity under this subdivision shall be established by the board
of trustees. In establishing the method of computing the
optional retirement annuity, the board of trustees shall obtain
the written recommendation approval of the commission-retained
actuary. The recommendations shall must be a part of the
permanent records of the board of trustees.
Sec. 17. Minnesota Statutes 1987 Supplement, section
353.32, subdivision 1a, is amended to read:
Subd. 1a. [SURVIVING SPOUSE OPTIONAL ANNUITY.] If a member
or former member who has attained the at least age of at least
50 years and has credit for not less than five years of
allowable service, or who has credit for not less than 30 years
of allowable service, regardless of age attained, dies before
the annuity or disability benefit has become payable begins to
accrue in accordance with 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, in lieu instead of a refund with interest provided in
subdivision 1, or survivor benefits otherwise payable pursuant
to under section 353.31, an annuity equal to the 100 percent
joint and survivor annuity which that the member could have
qualified for had the member terminated service on the date of
death. 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. The annuity shall must be computed as
provided in sections 353.29, subdivisions 2 and 3; and 353.30,
subdivisions 1, 1a, 1b and 1c. Sections 353.34, subdivision 3,
and 353.71, subdivision 2, apply to a deferred annuity payable
under this subdivision. No payment shall may accrue beyond the
end of the month in which entitlement to the annuity has
terminated. An amount equal to the any excess, if any, of the
accumulated contributions which 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 shall must be
paid to the deceased member's last designated beneficiary or, if
none, to the legal representative of the estate of the deceased
member. Any A member may specify in writing that this
subdivision shall does not apply and that payment shall may be
made only to the designated beneficiary, as otherwise provided
by this chapter.
Sec. 18. Minnesota Statutes 1986, section 353.32,
subdivision 5, is amended to read:
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 said decedent, or,
if none, to the next of kin under the laws of descent of the
state of Minnesota decedent's personal representative or, if
none, to the estate. Such A payment shall be under this
subdivision is a bar to recovery by any other person or
persons. Any A retirement annuity, or disability or survivor
benefit which shall have that has accrued at the time of death
of an annuitant, disabilitant or survivor may be paid in like
the same manner.
Sec. 19. Minnesota Statutes 1986, section 353.33,
subdivision 7, is amended to read:
Subd. 7. [PARTIAL REEMPLOYMENT.] Should such If a disabled
person resume resumes a gainful occupation from which earnings
are less than the salary at the date of disability or the salary
currently paid for similar positions, the board shall continue
the disability benefit in an amount which that, when added to
such the earnings, does not exceed the salary at the date of
disability or the salary currently paid for similar positions,
whichever is higher, provided the disability benefit in such
case does 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 shall may be taken from the
salary of a disabled person who is receiving a disability
benefit as provided in this subdivision.
Sec. 20. Minnesota Statutes 1987 Supplement, section
353.34, subdivision 3, is amended to read:
Subd. 3. [DEFERRED ANNUITY; ELIGIBILITY; COMPUTATION.] Any
person A member with at least five years of allowable service
when termination of public service occurs shall have has the
option of leaving the accumulated deductions in the fund
and thereby be being entitled to a deferred retirement annuity
commencing at age 65 or for to a deferred early retirement
annuity pursuant to under section 353.30, subdivision 1, 1a, 1b
or 1c. The deferred annuity shall must be computed in the
manner provided in under section 353.29, subdivisions 2 and 3,
on the basis of the law in effect on the date of termination of
public service and shall must be augmented as provided in
section 353.71, subdivision 2. Any person A former member
qualified to apply for a deferred retirement annuity may revoke
this option at any time prior to before the commencement of
deferred annuity payments by making application for a refund.
The person shall be is entitled to a refund of accumulated
member contributions within 30 days following date of receipt of
the application by the executive director.
Sec. 21. Minnesota Statutes 1986, section 353.37,
subdivision 1, is amended to read:
Subdivision 1. [EFFECT ON ANNUITY.] The annuity of a
person otherwise eligible therefor for an annuity under this
chapter shall must be suspended if the person reenters, and for
as long as the person remains in, public service as a
nonelective employee of a governmental subdivision, if earned
compensation for the reemployment service equals or 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 pursuant to the
provisions of under United States Code, title 42, section 403,
in any calendar year. In the event that the person has not yet
reached the minimum age for the receipt of social security
benefits, the maximum earnings for the person shall be are equal
to the annual maximum earnings allowable for the minimum age for
the receipt of social security benefits. The suspension of the
annuity shall must commence as of the first of the month after
the month in which the maximum permitted compensation is
exceeded as herein provided, but shall it applies only apply to
those months in which the annuitant is actually employed in
nonelective service in a position covered by this chapter. Any
An annuitant of the association who is elected to public office
after retirement shall be is entitled to hold such the office
and receive the annuity otherwise payable from the public
employees retirement association. Upon proper showing by an
annuitant that the reason for the suspension of the annuity
payments no longer exists, the monthly annuity payments shall
must be resumed. Public service performed by an annuitant
subsequent to retirement under this chapter shall does not
increase or decrease the amount of any an annuity when payment
of the annuity is resumed. The annuitant shall may not be
required to make any further contributions to the retirement
fund by reason of this subsequent public service.
Sec. 22. Minnesota Statutes 1986, section 353.65,
subdivision 2, is amended to read:
Subd. 2. The employee contribution shall be is an amount
equal to eight percent of the total salary of every the member.
This contribution shall 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, such the
member's employee contribution shall be is based on the total
salary received from all sources. If the member is a
firefighter employed on less than a full-time basis, the
member's total salary shall not include any reimbursement
payments for fire calls.
Sec. 23. Minnesota Statutes 1987 Supplement, section
353A.10, subdivision 3, is amended to read:
Subd. 3. [LEVY AND BONDING AUTHORITY.] A municipality in
which was located a local police or firefighters relief
association which that has consolidated with the fund may issue
special general obligation bonds of the municipality to defray
all or a portion of the principal amounts specified in section
353A.09, subdivisions 2 to 6, or certify to the county auditor
an additional special levy in the amount necessary to defray all
or a portion of the principal amount specified in section
353A.09, subdivisions 2 to 6, or the annual amount specified in
section 353A.09, subdivisions 2 to 6. The municipality may
pledge the full faith, credit, and taxing power of the
municipality for the payment of the principal of and interest on
the general obligation bonds. Notwithstanding any law to the
contrary, any additional special levy shall may not be included
in any limitation concerning rate or amount established by
charter or law and shall must be a special levy for the purposes
of section 275.50, subdivision 5, clause (o), and any municipal
bond may be issued shall without an election under section
475.58 and may not be included in the net debt of the
municipality for purposes of any charter or statutory debt
limitation, nor shall may any tax levy for the payment of bond
principal or interest be subject to any limitation concerning
rate or amount established by charter or law.
Sec. 24. Minnesota Statutes 1987 Supplement, section
353C.02, is amended to read:
353C.02 [CORRECTIONAL SERVICE EMPLOYEES.]
A local government correctional service employee is a
person who:
(1) meets the definition of "essential employee" in section
179A.03, subdivision 7, excluding state employees, University of
Minnesota employees, firefighters, peace officers subject to
licensure under sections 626.84 to 626.855, employees of
hospitals other than state hospitals, confidential employees,
supervisory employees other than supervisory employees of who
supervise correctional officers and who are stationed at
correctional facilities or city or county jails, principals, and
assistant principals;
(2) is employed by Dakota county, Hennepin county, Ramsey
county, St. Louis county, or Washington county, if the county
elects to participate under section 353C.04 or by a joint-powers
correctional agency in which St. Louis county or its
municipalities participate, if the governing body of the agency
elects to participate under section 353C.04;
(3) is a public employee within the meaning of section
353.01, subdivisions 2 and 2a; and
(4) is not at the time of the exercise of the participation
option under section 353C.04 a member of the basic program of
the public employees retirement association or a member of the
public employees police and fire fund.
Sec. 25. Minnesota Statutes 1987 Supplement, section
353C.03, is amended to read:
353C.03 [CORRECTIONAL SERVICE PLAN COVERAGE.]
Subdivision 1. [INITIAL COVERAGE.] A person who is a local
government correctional service employee on June 30, 1988, or on
the date on which the county elects to participate in the plan
under section 353C.04, whichever is later, is a member of the
local government correctional service retirement plan and shall
begin contributing to the plan on July 1, 1988, or on the first
day of the first pay period following the date on which the
county elects to participate in the plan under section 353C.04,
whichever is later.
Subd. 2. [SUBSEQUENT COVERAGE.] A person who becomes a
local government correctional service employee after June 30,
1988, or on the date on which the county elects to participate
in the plan under section 353C.04, whichever is later, is a
member of the local government correctional service retirement
plan and shall contribute to the plan.
Sec. 26. Minnesota Statutes 1987 Supplement, section
353C.04, is amended to read:
353C.04 [LOCAL GOVERNMENT EMPLOYING UNIT PARTICIPATION
OPTION.]
Dakota county, Hennepin county, Ramsey county, St. Louis
county, or Washington county or the governing board of a
joint-powers correctional agency in which St. Louis county or
its municipalities participate may elect to provide its
correctional employees with retirement coverage by the local
government correctional service retirement plan in lieu instead
of retirement coverage by the public employees retirement
association or the public employees police and fire fund. The
election must be made on a form provided by the executive
director of the public employees retirement association and,
once made, is irrevocable for all local government correctional
service employees employed by the county employing unit.
Sec. 27. Minnesota Statutes 1987 Supplement, section
353C.05, is amended to read:
353C.05 [CORRECTIONAL SERVICE PLAN CONTRIBUTIONS.]
Subdivision 1. [MEMBER CONTRIBUTIONS.] Beginning with the
first full pay period after July 1, 1988, after the effective
date of the election to provide retirement coverage by the local
governmental unit, or after becoming a local government
correctional service employee, whichever is later, in lieu
instead of employee contributions payable under section 353.27,
subdivision 2, a local government correctional service employee
shall make an employee contribution in an amount equal to five
7.5 percent of salary.
Subd. 2. [EMPLOYER CONTRIBUTIONS.] Beginning with the
first full pay period after July 1, 1988, after the effective
date of the election to provide retirement coverage by the local
governmental unit, or after becoming a local government
correctional service employee, whichever is later, in lieu
instead of employer contributions payable under section 353.27,
subdivision 3, the employer shall contribute for a local
government correctional service employee an amount equal to five
7.5 percent of salary.
Subd. 3. [ADJUSTMENT IN CONTRIBUTION RATES.] Beginning
with the first full pay period after the most recent actuarial
valuation of the local government correctional service
retirement plan prepared by the actuary retained by the
legislative commission on pensions and retirement is filed with
the executive director of the public employees retirement
association, the member contribution rate is a percentage that
equals one-half of the calculated total actuarial requirement of
the plan, and the employer contribution rate is the balance of
the calculated total actuarial requirement of the plan.
Sec. 28. Minnesota Statutes 1987 Supplement, section
353C.06, subdivision 1, is amended to read:
Subdivision 1. [ELIGIBILITY REQUIREMENTS.] After
separation from public employment, an employee covered under
section 353C.02 who has attained the age of at least 55 years
and has credit for not less than ten five years of coverage in
the local government correctional service plan is entitled, upon
application, to a normal retirement annuity. In lieu Instead of
a normal retirement annuity, a retiring employee may elect to
receive the optional annuity provided in section 353.30,
subdivision 3.
Sec. 29. Minnesota Statutes 1987 Supplement, section
353C.06, subdivision 3, is amended to read:
Subd. 3. [ANNUITY AMOUNT.] The average salary as defined
in subdivision 2, multiplied by two percent for each year of
allowable service for the first ten years and 2.5 percent for
each additional year of allowable service, and pro rata for
completed months less than a full year, determines the amount of
the normal annuity. If a person has earned allowable service in
the public employees retirement association or the public
employees police and fire fund for performing services other
than those of a local government correctional employee, the
annuity representing such service must be computed in accordance
with the coordinated formula under sections 353.29 and 353.30 or
section 353.651, whichever applies.
Sec. 30. Minnesota Statutes 1987 Supplement, section
353C.06, subdivision 4, is amended to read:
Subd. 4. [ACCRUAL AND DURATION.] The annuity under this
section begins to accrue as provided in section 353.29,
subdivision 7, and must be paid for an additional. The annuity
is payable for the life of the recipient, or in accordance with
the terms of any optional annuity form selected, and is payable
for 84 full calendar months or to the first of the month
following the month in which the employee becomes age 65,
whichever occurs first. After a recipient has received the
annuity calculated under this formula for 84 full calendar
months or to the first of the month following the month in which
the employee becomes age 65, whichever occurs first, the benefit
must be recomputed in accordance with the coordinated formula in
sections 353.29 and 353.30, except that if this amount, when
added to the social security benefit based on state public
service the employee is eligible to receive at that time, is
less than the benefit payable under subdivision 3, the retired
employee must is entitled to receive an amount payable under
subdivision 3, less any amount payable from social security
based on public service used in the benefit calculation. When
an annuity is reduced under this subdivision, any percentage of
adjustments that have been applied to the original annuity under
section 11A.18, before the reduction, must be compounded and
applied to the reduced annuity.
Sec. 31. Minnesota Statutes 1987 Supplement, section
353C.07, is amended to read:
353C.07 [AUGMENTATION IN CERTAIN CASES.]
Subdivision 1. [AUGMENTATION FOR PRIOR SERVICE BENEFITS.]
Unless prior service has been transferred or unless a combined
service annuity under section 356.30 has been elected, an
employee who becomes a local government correctional employee
after being a member of the public employees retirement
association or the public employees police and fire fund is
covered under section 353.71, subdivision 2, with respect to
that prior service.
Subd. 2. [DEFERRED ANNUITIES AUGMENTATION.] The deferred
annuity, if any, accruing under section 353.71 or 353C.06, must
be computed as provided in section 353C.06, subdivision 3, on
the basis of allowable service before the termination of
correctional service and augmented as provided in this
subdivision. The required reserves applicable to a deferred
annuity or to an annuity for which a former correctional service
employee was eligible, but had not applied, or to any deferred
segment of an annuity must be determined as of the date on which
the benefit begins to accrue and augmented by interest at the
rate of three percent compounded annually from the first day of
the month following the month in which the person ceased to be a
correctional service employee to the first day of the month in
which the annuity begins to accrue. If a person has more than
one period of uninterrupted service, the required reserves
related to each period must be augmented by interest under this
subdivision. The sum of the augmented required reserves so
determined is the present value of the annuity. "Uninterrupted
service" has the meaning given it in section 353.71, subdivision
2. If a person repays a refund, the service restored by the
repayment must be considered to be continuous with the next
period of service for which the person has credit by the plan.
The formula percentages used for each period of uninterrupted
service must be those applicable to a new employee. The
mortality table and interest assumption used to compute this
annuity must be those in effect when the person files an
application for the annuity. This subdivision shall not reduce
the annuity otherwise payable under this chapter.
Sec. 32. Minnesota Statutes 1987 Supplement, section
353C.08, subdivision 5, is amended to read:
Subd. 5. [DISABILITY BENEFIT TERMINATION.] The disability
benefit paid to a disabled local government correctional
employee terminates at the end of the month in which the
employee reaches age 62. If the disabled local government
correctional employee is still disabled when the employee
reaches age 62, the employee is deemed to be a retired employee
and, if the employee had elected an optional annuity under
subdivision 3, must receive an annuity in accordance with the
terms of the optional annuity previously elected. If the
employee had not elected an optional annuity under subdivision
3, the employee may elect either to receive a normal retirement
annuity computed on the coordinated formula in the manner
provided in section 353C.06 353.29 or to receive an optional
annuity as provided in section 353.30, subdivision 3, based on
the same length of service as used in the calculation of the
disability benefit. Election of an optional annuity must be
made before attaining the age of 62 years. The reduction for
retirement prior to age 65 as provided in section 353.30,
subdivisions 1 and 1c, is not applicable. The savings clause
provision of section 353C.06, subdivision 4, is applicable.
Sec. 33. Minnesota Statutes 1987 Supplement, section
353C.08, is amended by adding a subdivision to read:
Subd. 7. [COMBINED SERVICE DISABILITY BENEFIT.] If the
employee is entitled to receive a disability benefit as provided
in subdivision 1 or 2 and has credit for less covered
correctional service than the length of service upon which the
correctional disability benefit is based, and also has credit
for regular plan service, the employee is entitled to a
disability benefit or deferred retirement annuity based on the
regular plan service only for the service that, when combined
with the correctional service, exceeds the number of years on
which the correctional disability benefit is based. The
disabled employee who also has credit for regular plan service
must in all respects qualify under section 353.33 to be entitled
to receive a disability benefit based on the regular plan
service, except that the service may be combined to satisfy
length of service requirements. Any deferred annuity to which
the employee may be entitled based on regular plan service must
be augmented as provided in section 353.71 while the employee is
receiving a disability benefit under this section.
Sec. 34. Minnesota Statutes 1987 Supplement, section
353D.05, subdivision 2, is amended to read:
Subd. 2. [INVESTMENT OPTIONS.] (a) An individual
participant may elect to purchase shares in the income share
account, the growth share account, the money market account, the
bond market account, or the common stock index account
established by section 11A.17, or a combination of those
accounts. The participant may elect to purchase shares in a
combination of those accounts by specifying the percentage of
contributions to be used to purchase shares in each of the
accounts.
(b) Twice in a calendar year, a participant may indicate in
writing a choice of options for subsequent purchases of shares.
Thereafter After a choice is made, until the participant makes a
different written indication, the executive director of the
association shall purchase shares in the supplemental investment
fund or funds specified by the participant. If no initial
option is indicated by a participant, the executive director
shall invest all contributions made by or on behalf of a
participant in the income share account. A choice of investment
options is effective no later than the first pay date first
occurring more than 30 days after receipt of the written choice
of options.
(c) Twice in a calendar year, a participant or former
participant may also change the investment options selected for
all or a portion of the individual's previously purchased
shares. If a partial transfer of previously purchased shares is
selected, a minimum of $500 $200 must be transferred and a
minimum balance of $500 $200 must remain in the previously
selected investment option. A change may be made only from one
account or a combination of accounts to a single account. A
change under this paragraph is effective as soon as cash flow to
an account permits, but not later than six months from the
requested change.
Sec. 35. Minnesota Statutes 1987 Supplement, section
353D.07, subdivision 1, is amended to read:
Subdivision 1. [TYPE OF PLAN; UNIFORMITY.] The plan is a
defined contribution plan where when the benefits are payable
upon termination of service, retirement, or death, or withdrawal
when permitted, are. The amount of benefits is determined by
the value of accumulated contributions plus a proportionate
share of investment income of the fund credited to each
individual account. Each ambulance service shall determine
eligibility for participation subject to terms of this act.
Eligibility standards must be uniform among all ambulance
service personnel of an ambulance service electing to
participate.
Sec. 36. Minnesota Statutes 1987 Supplement, section
353D.07, subdivision 2, is amended to read:
Subd. 2. [AGE; VESTING PAYMENT OF BENEFITS.] Normal
retirement age is 50 years. Early retirement is not allowed.
Sixty months of service credit are required for vesting of
retirement benefits. No minimum period of service is required
for vesting of death benefits. Withdrawal of or a retirement
benefit based on member contributions and employer contributions
plus accrued investment income vests is payable immediately upon
the death or termination of an active member for a period that
exceeds 30 days. Upon completion of 60 months of service under
the plan with one or more ambulance services, a participant
terminating active service prior to age 50 is entitled to
receive the value of the participant's individual account upon
or after attaining age 50. An application by or on behalf of
the participant must be filed before any payment of benefits may
be made.
Sec. 37. Minnesota Statutes 1987 Supplement, section
353D.07, subdivision 4, is amended to read:
Subd. 4. [DISABILITY OR DEATH OF A MEMBER.] No disability
coverage shall be provided by the plan. In the event of the
death of an active participant with any credited service or a
deferred participant under age 50, the total value of the
account shall must be paid in a lump sum to the designated
beneficiary or, if none, the heirs at law of the decedent.
Sec. 38. Minnesota Statutes 1987 Supplement, section
353D.08, is amended to read:
353D.08 [PORTABILITY.]
Qualified ambulance service personnel who change employment
or membership among participating ambulance services may must
continue participation in the plan without penalty or forfeiture
after their interest vests. Qualified ambulance service
personnel who change employment or membership to a
nonparticipating ambulance service are not subject to the
forfeiture required by section 353D.07, subdivision 5 if
termination from one participating ambulance service and
commencement in another participating ambulance service occur
within 30 days.
Sec. 39. Minnesota Statutes 1987 Supplement, section
356.302, subdivision 1, is amended to read:
Subdivision 1. [DEFINITIONS.] (a) The terms used in this
section are defined in this subdivision.
(b) "Average salary" means the highest average of covered
salary for the appropriate period of credited service that is
required for the calculation of a disability benefit by the
covered retirement plan and that is drawn from any period of
credited service and successive years of covered salary in a
covered retirement plan.
(c) "Covered retirement plan" or "plan" means a retirement
plan listed in subdivision 7.
(d) "Duty-related" means a disabling illness or injury that
occurred while the person was actively engaged in employment
duties or that arose out of the person's active employment
duties.
(e) "General employee retirement plan" means a covered
retirement plan listed in subdivision 7, clauses (1) to (8).
(f) "Occupationally disabled" means the condition of having
any a medically determinable physical or mental impairment that
makes a person unable to satisfactorily perform the minimum
requirements of the person's employment position or a
substantially similar employment position.
(g) "Public safety employee retirement plan" means a
covered retirement plan listed in subdivision 7, clauses (9) to
(11).
(h) "Totally and permanently disabled" means the condition
of having any a medically determinable physical or mental
impairment that makes a person unable to engage in any
substantial gainful activity and that is expected to continue or
has continued for a period of at least one year or that is
expected to result directly in the person's death.
Sec. 40. Minnesota Statutes 1987 Supplement, section
356.302, subdivision 3, is amended to read:
Subd. 3. [GENERAL EMPLOYEE PLAN ELIGIBILITY REQUIREMENTS.]
A disabled member of a covered retirement plan who has credit
for allowable service in a combination of general employee
retirement plans is entitled to a combined service disability
benefit if the member:
(1) is less than 65 years of age on the date of application
for the disability benefit;
(2) has become totally and permanently disabled;
(3) has credit for allowable service in any combination of
general employee retirement plans totaling at least ten years if
the person has not reached age 50 or at least five years if the
person has reached age 50;
(4) has credit for at least six months of allowable service
with the current general employee retirement plan before the
commencement of the disability;
(5) has at least five continuous years of allowable service
credit by the general employee retirement plan or has at least a
total of five years of allowable service credit by a combination
of general employee retirement plans in a 72-month period during
which no interruption of allowable service credit from a
termination of employment exceeded 29 days; and
(6) is not receiving a retirement annuity or disability
benefit from any covered general employee retirement plan at the
time of the commencement of the disability.
Sec. 41. [ELECTION TO RESUME RETIREMENT COVERAGE.]
A person employed by a public hospital as defined in
section 355.71, subdivision 3, who exercised an option under
Laws 1963, chapter 793, section 3, subdivision 5, between July
1, 1963, and June 30, 1967, to terminate membership in the
coordinated program of the public employees retirement
association may elect to resume that membership. The election
to resume membership must be made before October 1, 1988, on a
form prescribed by the executive director of the public
employees retirement association. Resumption of membership
begins as of the first day of the first full pay period after
the election is filed with the executive director.
Sec. 42. [REPEALER.]
Minnesota Statutes 1987 Supplement, section 353D.07,
subdivision 5, is repealed.
Sec. 43. [EFFECTIVE DATE.]
Section 12 is effective March 1, 1988. Section 21 is
effective January 1, 1988. The remaining sections are effective
July 1, 1988.
ARTICLE 6
MEDICARE COVERAGE REFERENDUM
Section 1. [355.90] [OPTIONAL MEDICARE COVERAGE FOR
CERTAIN PRE-1986 PUBLIC EMPLOYEES.]
Subdivision 1. [DEFINITIONS.] (a) Notwithstanding any
provision of section 355.01 to the contrary, the terms used in
this section are defined in this subdivision.
(b) "Employee" means an active member or participant of a
public employee pension plan listed in section 356.30,
subdivision 3, clauses (5), (6), (7), (9), (10), (11), and (12),
who is not covered by a previous agreement under section 355.02
for that employment and who meets the requirements of United
States Code, title 42, section 418(v)(2).
(c) "Employment" means service performed for compensation
by an employee in the employ of the state or of a political
subdivision that constitutes Medicare qualified government
employment under the provisions of United States Code, title 42,
section 410(p).
(d) "Political subdivision" means a public employer under
section 355.01, subdivision 10.
(e) "Social Security Act" means the act cited in section
355.01, subdivision 8.
(f) "State agency" means the commissioner of employee
relations or the commissioner's designee.
(g) "Wages" means compensation specified in section 355.01,
subdivision 2.
Subd. 2. [OPTIONAL MEDICARE COVERAGE AGREEMENT.] The state
agency, with the approval of the governor, may modify its
agreement on behalf of the state and its political subdivisions
with the Secretary of Health and Human Services to extend the
provisions of United States Code, title 42, sections 426, 426-1,
and 1395c, to current employees of the state and its political
subdivisions who do not have that coverage through coverage by
the federal old age, survivors, and disability insurance program
for that employment under any previous agreement or modification
of the agreement.
Subd. 3. [REFERENDUM.] A referendum on the question of
extending the provisions of United States Code, title 42,
sections 426, 426-1, and 1395c, must be held for each public
employee pension plan listed in section 356.30, subdivision 3,
except clauses (5) and (6), that has current members or
participants who do not have coverage by the federal old age,
survivors, and disability insurance program for the employment
giving rise to that pension plan membership. The state agency
shall supervise the referendum in accordance with United States
Code, title 42, section 418, on the date or dates set by the
governor for each pension plan. The notice of the referendum
provided to each employee must contain a statement sufficient to
inform the person of the rights available to the person as an
employee in Medicare qualified government employment and the
employee contribution rates applicable to the program. The
referendum is approved if a majority of the members or
participants indicate their desire to have the coverage on a
form prescribed by the state agency. If the referendum is
approved, the governor shall certify that fact to the Secretary
of Health and Human Services, and the coverage is effective for
all members or participants of the plan on the first of the
month after the certification unless the participant or member
elects coverage effective retroactively to April 1, 1986.
Subd. 4. [EMPLOYEE AND EMPLOYER CONTRIBUTIONS.] (a) If the
referendum is approved, beginning on the first of the month
after the certification of approval by the governor, the
employer of each member or participant covered by the referendum
shall deduct from the wages of the employee an amount equal to
the tax that would be imposed under United States Code, title
26, section 3101(b), if the services of the employee for which
wages were paid constituted employment as defined in United
States Code, title 26, section 3121.
(b) In addition to the deduction specified in paragraph
(a), the employer of each member or participant covered by the
referendum shall also pay an amount equal to the tax that would
be imposed under United States Code, title 26, section 3111(b),
on the same wage base specified in paragraph (a).
(c) The amounts under paragraphs (a) and (b) shall be paid
by the employer to the Secretary of the Treasury in the manner
required by the secretary.
Sec. 2. [EFFECTIVE DATE.]
Section 1 is effective the day following final enactment.
ARTICLE 7
VOLUNTEER FIREFIGHTERS RELIEF ASSOCIATIONS
Section 1. [60A.40] [APPROVAL OF VOLUNTEER FIRE ANNUITY
CONTRACT BUSINESS.]
No insurance company that issues single premium annuity
contracts may enter into an annuity contract with a volunteer
firefighters relief association in this state unless the
insurance company has been authorized to conduct this type of
business by the commissioner. If the commissioner finds that
the insurance company is rated according to a recognized
national rating agency or organization among the top 25 percent
of all insurance companies doing this type of business and is so
situated and has sufficient capabilities to service these
contracts throughout the state, the commissioner shall approve
the insurance company for the conduct of this type of business.
Sec. 2. Minnesota Statutes 1986, section 424A.02, is
amended by adding a subdivision to read:
Subd. 8a. [PURCHASE OF ANNUITY CONTRACTS.] A relief
association providing a lump-sum service pension, if the
governing articles of incorporation or bylaws so provide, may
purchase an annuity contract on behalf of a retiring member in
an amount equal to the service pension otherwise payable at the
request of the person and in place of a direct payment to the
person. The annuity contract must be purchased from an
insurance carrier licensed to do business in this state and
approved for this product by the commerce commissioner under
section 1.
Sec. 3. Minnesota Statutes 1986, section 424A.02, is
amended by adding a subdivision to read:
Subd. 13. [COMBINED SERVICE PENSIONS.] If the articles of
incorporation or bylaws of the associations so provide, a
volunteer firefighter with total service credit of ten years or
more as a member of two or more relief associations is entitled,
when otherwise qualified, to a prorated service pension from
each association in which the member has two years or more of
service credit. The prorated service pension must be based on
the service pension amount in effect for the relief association
on the date volunteer firefighting services covered by that
relief association terminate. To receive a service pension
under this subdivision, the firefighter must become a member of
the second or succeeding association and give notice of
membership to the prior association within two years of
termination of active service with the prior association. The
notice must be attested to by the association secretary.
Sec. 4. [EFFECTIVE DATE.]
Sections 1 and 2 are effective the day following final
enactment.
Section 3 is effective July 1, 1988, and applies to service
performed by a volunteer serving with a fire department on that
date or thereafter.
ARTICLE 8
LOCAL POLICE AND FIRE RELIEF ASSOCIATIONS
Section 1. [VIRGINIA FIREFIGHTERS RELIEF ASSOCIATION;
PRIOR LEGISLATION.] Laws 1987, chapter 372, article 2, section
16, is amended to read:
Sec. 16. [EFFECTIVE DATE.]
Section 1 is effective the day following final enactment.
Sections 2 to 6 and 15 are effective upon approval by the
Minneapolis city council and compliance with Minnesota Statutes,
section 645.021. Sections 7 to 9 are effective upon approval by
the Hibbing city council and compliance with Minnesota Statutes,
section 645.021. Section 10 is effective as approved by the
governing body of the city of West St. Paul and if there is
compliance with Minnesota Statutes, section 645.021, and the
increase in service pensions payable due to section 10 is
initially payable on January 1, 1988, and is applicable to any
member of the West St. Paul police relief association who
retired on or after February 1, 1985. Section 11 is effective
upon approval by the Clifton independent nonprofit firefighting
corporation and the approval of the governing body of the
township of Duluth and compliance with Minnesota Statutes,
section 645.021. Section 12 is effective upon approval by the
Mankato city council and compliance with Minnesota Statutes,
section 645.021. Section 13 is effective upon approval by the
governing body of the city of Millerville and compliance with
Minnesota Statutes, section 645.021. Section 14 is
effective retroactive to January 1, 1987, upon approval by the
Virginia city council and compliance with Minnesota Statutes,
section 645.021.
Sec. 2. [VIRGINIA FIREFIGHTERS RELIEF ASSOCIATION;
SURVIVOR BENEFITS.]
Survivor benefits accrued to a member of the Virginia
firefighters relief association up to the date of death must be
paid to surviving children, if any, if the spouse of the member
predeceases the member. If no children survive the member,
survivor benefits accrued to the member up to the date of death
must be paid to the beneficiary designated by the member.
Sec. 3. [EVELETH POLICE AND FIREFIGHTERS; BENEFIT
INCREASE.]
Notwithstanding any general or special law to the contrary,
in addition to other benefits payable, retirement benefits
payable to retired police officers and firefighters and their
surviving spouses by the Eveleth police and fire trust fund may
be increased by $50 a month. Increases may be made retroactive
to January 1, 1988.
Sec. 4. [FRIDLEY FIREFIGHTERS; DEFINED CONTRIBUTION PLAN.]
Notwithstanding any law to the contrary, the Fridley
volunteer firefighters relief association may amend its articles
of incorporation or bylaws to convert its defined benefit
pension plan to a defined contribution plan. The conversion
plan must provide for allocation of special fund assets among
individual accounts to be established for each active
firefighters association member. Instead of providing further
defined pension plan benefits, the association shall purchase
annuity contracts with existing special fund assets for retired
members and for active members who may not qualify as a
"volunteer firefighter" under Minnesota Statutes, chapter 424A.
All provisions of Minnesota Statutes not inconsistent with this
section govern the defined contribution plan established under
this section.
Sec. 5. Laws 1955, chapter 151, section 9, subdivision 7,
as amended by Laws 1963, chapter 271, section 6, is amended to
read:
Subd. 7. The association shall pay to any member who,
after not less than ten five years of service in the police
department, retires because of sickness or injury occurring
while not on duty and not engaged in police work and the
retirement is necessary because the member is unable to perform
police duties, a pension of 20 ten units per month, and for each
additional year of service over ten five years, a pension of two
units per month, but not to exceed a total of 40 units. If a
member is entitled to more than 40 units through years of
service, he shall receive those additional units over 40 when he
becomes 50 years of age, but the total of these pension payments
shall not exceed 50 units per month.
Sec. 6. [MINNETONKA VOLUNTEER FIREFIGHTERS.]
Subdivision 1. [EXCLUSION FROM COVERAGE.] Notwithstanding
any law to the contrary, a volunteer firefighter serving with
the Minnetonka fire department is excluded from the definition
of "public employee" in Minnesota Statutes, section 353.01,
subdivision 2, for activities undertaken as part of volunteer
firefighter duties. Compensation paid to a Minnetonka volunteer
firefighter for volunteer firefighting duties must be excluded
from the definition of "salary" in section 353.01, subdivision
10. A Minnetonka volunteer firefighter is not a member of the
public employees police and fire fund as a result of volunteer
firefighter duties.
Subd. 2. [QUALIFICATION FOR CERTAIN PERSONS.] A person who
is a Minnetonka volunteer firefighter may qualify as a "public
employee" under section 353.01, subdivision 2, and may be a
member of the public employees police and fire fund for
compensation received from employment and activities other than
volunteer firefighter duties.
Subd. 3. [REFUND.] A volunteer firefighter who is excluded
from membership by subdivision 1 is entitled to a refund of
member contributions to the public employees retirement
association or the public employees police and fire fund based
on compensation as a volunteer firefighter, plus interest at the
rate of six percent a year, compounded annually, if the person
or the city of Minnetonka demonstrates to the satisfaction of
the executive director of the association the amount of
contributions made by the person on behalf of service as a
volunteer firefighter.
Sec. 7. [THIEF RIVER FALLS VOLUNTEER FIRE RELIEF
ASSOCIATION; VALIDATION OF CERTAIN SERVICE PENSIONS.]
The payment of a service pension before January 1, 1988, by
the Thief River Falls volunteer firefighters relief association
to a person who terminated active service with the Thief River
Falls fire department with at least 20 years of active service
before attaining age 50 and who complies with all other
conditions of the articles of incorporation or bylaws of the
relief association are validated.
Sec. 8. [ST. PAUL TEACHERS RETIREMENT FUND ASSOCIATION
FIVE-YEAR VESTING.]
In accordance with Minnesota Statutes, section 354A.12,
subdivision 4, approval is granted for the St. Paul teachers
retirement fund association to amend the bylaws of the
association in effect on June 1, 1978, as amended, governing the
benefits of the basic division of the association, article IV,
section 3, paragraph 1, clauses (b), applicable to limited
service pensions, and (d), applicable to deferred pensions, and
article IV, section 3, paragraph 10, applicable to survivor
benefits, by replacing the ten years of accredited service
vesting requirement with a five years of accredited service
vesting requirement.
Sec. 9. [MINNEAPOLIS TEACHERS PARTICIPATING ANNUITY;
EXTENSION TO CERTAIN RETIREES.]
In accordance with Minnesota Statutes, section 354A.12,
subdivision 4, approval is granted for the Minneapolis teachers
retirement fund association to amend its articles of
incorporation to permit annual participating annuity adjustments
under article IX, subsection (19), to be applied, effective
January 1, 1989, to minimum normal retirement annuities payable
to eligible recipients under article IX, subsection (14), as
amended pursuant to Laws 1987, chapter 372, article 3, section
1, paragraph (f).
Sec. 10. [LOCAL APPROVAL.]
Sections 1 and 2 are effective upon approval by the
Virginia city council and compliance with Minnesota Statutes,
section 645.021.
Section 3 is effective upon approval by the Eveleth city
council and compliance with Minnesota Statutes, section 645.021.
Section 4 is effective upon approval by the Fridley city
council and compliance with Minnesota Statutes, section 645.021.
Section 5 is effective upon approval by the St. Paul city
council and compliance with Minnesota Statutes, section 645.021,
subdivision 3.
Section 6 is effective upon approval by the Minnetonka city
council and compliance with Minnesota Statutes, section 645.021.
Section 7 is effective upon approval by the Thief River
Falls city council and compliance with Minnesota Statutes,
section 645.021.
Sections 8 and 9 are effective the day following final
enactment.
ARTICLE 9
OTHER RETIREMENT ISSUES
Section 1. Minnesota Statutes 1987 Supplement, section
352.85, subdivision 1, is amended to read:
Subdivision 1. [ELIGIBILITY; RETIREMENT ANNUITY.] Any
person who is employed by the department of military affairs
other than as a full-time firefighter, who is covered by the
general employee retirement plan of the system as provided in
section 352.01, subdivision 23, who is ordered to active duty
under section 190.08, subdivision 3, who elects this special
retirement coverage under subdivision 4, who is required to
retire from federal military status at the an age of 60 years
earlier than age 65 by applicable federal laws or regulations
and who terminates employment as a state employee upon attaining
that mandatory retirement age is entitled, upon application, to
a retirement annuity computed in accordance with section
352.115, subdivisions 2 and 3, without any reduction for early
retirement under section 352.116, subdivision 1.
Sec. 2. Minnesota Statutes 1987 Supplement, section
352.85, subdivision 2, is amended to read:
Subd. 2. [DISABILITY BENEFIT.] An employee described in
subdivision 1, who is less than 60 years of the applicable
federal military status mandatory retirement age and who becomes
disabled and physically or mentally unfit to perform
occupational duties due to injury, sickness, or other
disability, and who is found disqualified for retention on
active duty as a result of a physical examination required by
applicable federal laws or regulations, is entitled upon
application to disability benefits computed in the manner
specified in section 352.113. Disability benefits are otherwise
governed by section 352.113, except that the age for the
termination of the disability benefit is 60 years the applicable
federal military status mandatory retirement age.
Sec. 3. [356.245] [LOCAL ELECTED OFFICIALS.]
An elected official covered by section 353.01, subdivision
2a, is eligible to participate in the state of Minnesota
deferred compensation plan under section 356.24. A local
governmental unit may make the matching employer contributions
authorized by that section on the part of a participating
elected official.
Sec. 4. Minnesota Statutes 1986, section 490.124,
subdivision 2, is amended to read:
Subd. 2. [MINIMUM SERVICE REQUIREMENT; EXTENSION OF TERM.]
No judge shall be eligible for an annuity at normal or early
retirement date if the judge has less than ten five years of
allowable service. A judge who shall retire on or, as permitted
under sections 490.121 to 490.132, after mandatory retirement
date, shall be entitled to a proportionate annuity based upon
the allowable service of the judge at date of retirement.
A judge who was in office on December 31, 1973 and
thereafter and who, by the date on which the current term
expires, would not be eligible to retire with full benefits
under statutes in effect on December 31, 1973, may apply to the
governor for an extension to serve up to three additional years,
stating the intention of the judge to retire upon attaining
eligibility to receive a retirement allowance. Notwithstanding
section 490.125, the governor shall forthwith make a written
order accepting the retirement application, and extending the
term of office of the judge for the period of time, not to
exceed three years, as may be necessary to make the judge
eligible for retirement, solely for purposes of computing
benefits hereunder.
Sec. 5. Laws 1986, chapter 359, section 25, is amended to
read:
Sec. 25. [STATE AIDS FOR WINONA.]
Upon receipt of the state auditor's report of the relief
association for calendar year 1985 and of the valuation report
for December 31, 1985, the commissioner of finance shall issue
warrants to the city of Winona in the amounts equal to the
amounts of police state aid, amortization state aid, and
supplemental amortization state aid withheld by the department
of finance since August 26, 1985 1984, plus interest at a rate
of six percent per annum from the date each state aid payment
was withheld. This section does not apply to state aids for
which the relief association must qualify after December 31,
1987.
Sec. 6. [EFFECTIVE DATE.]
Sections 1, 2, and 5 are effective on the day following
final enactment. Sections 3 and 4 are effective July 1, 1988.
ARTICLE 10
UNIFORM JUDICIAL RETIREMENT PLAN
Section 1. Minnesota Statutes 1986, section 490.123,
subdivision 1, is amended to read:
Subdivision 1. [CREATION; CONTRIBUTIONS.] There is hereby
created a special fund known as The "judges' retirement fund".
The fund shall must be credited with all contributions, all
interest, and all other income authorized by law. From this
fund there are appropriated the payments authorized by sections
490.121 to 490.132, in the amounts and at the times provided
herein, including the expenses of administering the fund. Each
A judge shall contribute to the fund from each salary payment a
sum equal to one-half of one percent of salary, plus a sum equal
to the salary multiplied by the rate of employee tax specified
in the Federal Insurance Contributions Act as defined in section
355.01, subdivision 9, but in aggregate not less than seven
percent of salary. In addition, a judge referred to in section
355.392, subdivision 1, clause (b), shall contribute to the fund
from each salary payment a sum equal to an additional
three-quarters of one percent of salary. The balance of all
money necessary for administering sections 490.121 to 490.132
and the judges' retirement fund, including payment of retirement
compensation and other benefits under sections 490.121 to
490.132, shall must be contributed to the fund by the state.
Money certified by the executive director of the Minnesota
state retirement system to the commissioner of finance as needed
to meet the state's obligations to the judges' retirement fund
shall must be transferred to the fund at least once a month.
Sec. 2. Minnesota Statutes 1987 Supplement, section
490.124, subdivision 11, is amended to read:
Subd. 11. [OPTIONAL ANNUITIES.] There shall be No survivor
or death benefits may be paid in connection with the death of a
judge who retires after December 31, 1973, except as otherwise
provided in sections 490.121 to 490.132. Within 30 days before
retirement, except as provided in subdivision 10, a judge may
elect to receive, in lieu instead of the normal retirement
annuity, an optional retirement annuity which shall take in the
form of either an annuity payable for a period certain and for
life thereafter or after that period, a joint and survivor
annuity without reinstatement in the event of the designated
beneficiary predeceasing the retired judge, or a joint and
survivor annuity with reinstatement in the event of the
designated beneficiary predeceasing the retired judge. The An
optional retirement annuity shall must be actuarially equivalent
to a single life annuity with no term certain and shall must be
established by the board of directors of the Minnesota state
retirement system. In establishing these optional retirement
annuity forms, the board shall obtain the written recommendation
of the actuary retained by the legislative commission on
pensions and retirement. The recommendations shall must be a
part of the permanent records of the board.
Sec. 3. Minnesota Statutes 1986, section 490.129, is
amended to read:
490.129 [BENEFITS OFFSET.]
Upon any event of maturity of benefits for any a judge
referred to in section 355.392, subdivision 1, clause (b), the
amount payable from the judges' retirement fund shall must be
reduced by 75 50 percent of the amount of the judge's primary
benefit payable upon the event of maturity of benefits under the
Social Security Act.
Upon any event of maturity of benefits for the judge's
surviving spouse or dependent children under section 490.124,
subdivision 9, the amount payable from the judges' retirement
fund shall must be based (a) (1) on the judge's normal
retirement annuity or (b) (2) upon the event of maturity of
benefits under the Social Security Act, on the judge's normal
retirement annuity after reduction by 75 50 percent of the
amount of the judge's primary benefit under the Social Security
Act; provided that the surviving spouse or dependent
children shall must receive an annuity of not less than 25
percent of the judge's final average compensation.
Sec. 4. [EFFECTIVE DATE.]
Sections 1 and 2 are effective July 1, 1988. Section 3 is
effective retroactively to August 1, 1987, and applies to
benefits that accrued, accrue, or would have accrued after that
date.
ARTICLE 11
INDIVIDUAL RETIREMENT ACCOUNT PLAN
Section 1. Minnesota Statutes 1986, section 354.05, is
amended by adding a subdivision to read:
Subd. 2a. [EXCEPTIONS.] Notwithstanding subdivision 2, a
person who is first employed as a teacher in the state
university system or the state community college system after
June 30, 1988, is not a member of the fund unless the person is
covered by section 3, subdivision 2, and has exercised an option
under that subdivision to remain a member of the fund.
Sec. 2. [354B.01] [DEFINITIONS.]
Subdivision 1. [PLAN.] "Plan" means the individual
retirement account plan established by sections 2 to 5.
Subd. 2. [COVERED EMPLOYMENT, STATE UNIVERSITIES.]
"Covered employment," with respect to employment by the state
university system, means employment in a position included in
the definition of teacher under section 354.05, subdivision 2,
other than that of an administrator covered by or eligible for
coverage in the Minnesota state retirement system unclassified
employees retirement plan.
Subd. 3. [COVERED EMPLOYMENT, COMMUNITY COLLEGES.]
"Covered employment," with respect to employment by the
community college system, means employment in a position
included in the definition of teacher under section 354.05,
subdivision 2.
Sec. 3. [354B.02] [COVERED PERSONS.]
Subdivision 1. [PLAN PARTICIPANTS.] Except as provided in
subdivision 2, a person who was first employed in covered
employment after June 30, 1988, shall participate in the plan.
Subd. 2. [PERSONS WITH CERTAIN PRIOR SERVICE.] A person
with prior service as a member of the teachers retirement
association other than in covered employment under section 2,
subdivision 2 or 3, who is entitled to a deferred annuity under
section 354.55, subdivision 11, and who is first employed in
covered employment after June 30, 1988, may, at the person's
option, remain a member of the teacher's retirement association
or participate in the plan.
Sec. 4. [354B.04] [CONTRIBUTIONS.]
Subdivision 1. [MEMBER CONTRIBUTIONS.] Persons in covered
employment who participate in the plan shall make a member
contribution in an amount equal to the amount prescribed by
section 354.42, subdivision 2. The contribution must be made by
payroll deduction each pay period.
Subd. 2. [EMPLOYER CONTRIBUTIONS.] The employer of persons
in covered employment who participate in the plan shall make an
employer contribution in an amount equal to the amount
prescribed by section 354.42, subdivision 3, and shall continue
to make an additional employer contribution to the teachers
retirement association in an amount equal to the amount
prescribed by section 354.42, subdivision 5.
Subd. 3. [MANNER OF EMPLOYER CONTRIBUTIONS.] The employer
of persons in covered employment shall make employer
contributions from any available revenue sources. The employer
contribution must be made each pay period.
Sec. 5. [354B.05] [ADMINISTRATION.]
Subdivision 1. [GOVERNING BOARDS.] The state university
board shall administer the plan for persons in covered
employment under section 2, subdivision 2. The community
college board shall administer the plan for persons in covered
employment under section 2, subdivision 3.
Subd. 2. [PURCHASE OF CONTRACTS.] The state university
board and the community college board shall arrange for the
purchase of annuity contracts, fixed, variable, or a combination
of fixed and variable, or custodial accounts to provide
retirement and death benefits to members of the plan. The
contracts or accounts must be purchased with contributions under
section 4 or money or assets otherwise provided by law or by
authority of the state university board or community college
board and acceptable by the financial institutions from which
the contracts or accounts are purchased.
Subd. 3. [SELECTION OF FINANCIAL INSTITUTIONS.] The state
university board and the community college board shall select no
more than three financial institutions to provide annuity
contracts or custodial accounts. Investment programs offered by
the institutions must meet the requirements of section 401(a) or
403(b) of the Internal Revenue Code of 1986, as amended. In
making their selections, the boards shall consider these
criteria:
(1) the experience and ability of the financial institution
to provide retirement and death benefits suited to the needs of
the covered employees;
(2) the relationship of the benefits to their cost; and
(3) the financial strength and stability of the institution.
Subd. 4. [BENEFITS OWNED BY MEMBERS.] The retirement and
death benefits provided by the annuity contracts or custodial
accounts are owned by the members of the plan and must be paid
in accordance with the provisions of the annuity contracts or
custodial accounts.
Sec. 6. Minnesota Statutes 1986, section 356.24, is
amended to read:
356.24 [SUPPLEMENTAL PENSION OR DEFERRED COMPENSATION
PLANS, RESTRICTIONS UPON GOVERNMENT UNITS.]
It is unlawful for a school district or other governmental
subdivision or state agency to levy taxes for, or contribute
public funds to a supplemental pension or deferred compensation
plan which that is established, maintained, and operated in
addition to a primary pension program for the benefit of the
governmental subdivision employees other than to a supplemental
pension plan which that was established, maintained and operated
prior to before May 6, 1971, to any a plan which that
provides solely for group health, hospital, disability, or death
benefits, to the individual retirement account plan established
by sections 2 to 5, or to any a plan which that provides
solely for severance pay as authorized pursuant to by section
465.72 to a retiring or terminating employee. No change in
benefits or employer contributions in any plan to which this
section applies after May 6, 1971 shall be, is effective without
prior legislative authorization.
Sec. 7. [CERTAIN NEW EMPLOYEES.]
Notwithstanding section 3, a person who was first hired in
covered employment after June 30, 1988, does not become a member
of the plan established by sections 3 to 5 until the plan is in
operation and ready to accept contributions, and the payment of
employer and employee contributions under section 4 does not
begin until that time.
Sec. 8. [EFFECTIVE DATE.]
Sections 1 to 7 are effective July 1, 1988.
Approved May 4, 1988
Official Publication of the State of Minnesota
Revisor of Statutes