Bill Text: MN HF628 | 2013-2014 | 88th Legislature | Introduced
Bill Title: Minnesota State Retirement System; language clarified and removed; outdated requirements, contribution rate revision procedures, disability standards and benefit administration procedures, pension commission standards, and pension plan financial report content provisions revised; and elected state officers retirement plan merged into the legislators retirement plan.
Spectrum: Partisan Bill (Democrat 2-0)
Status: (Introduced - Dead) 2013-02-14 - Introduction and first reading, referred to Government Operations [HF628 Detail]
Download: Minnesota-2013-HF628-Introduced.html
1.2relating to retirement; Minnesota State Retirement System plans; clarifying
1.3language; removing obsolete language; revising outdated requirements; revising
1.4contribution rate revision procedures; revising disability standards and disability
1.5benefit administration procedures; merging the elected state officers retirement
1.6plan into the legislators retirement plan; revising pension commission standards
1.7provision; revising pension plan financial report contents provision; amending
1.8Minnesota Statutes 2012, sections 3.85, subdivision 10; 3A.011; 3A.03,
1.9subdivision 3; 3A.07; 3A.115; 3A.13; 3A.15; 352.01, subdivision 17b; 352.03,
1.10subdivision 8; 352.045, by adding subdivisions; 352.113, subdivisions 4, 6, 8, by
1.11adding subdivisions; 352.22, subdivision 3; 352.955, subdivisions 1, 3; 352B.011,
1.12subdivision 13; 352B.10, by adding a subdivision; 352D.04, subdivision 2;
1.13356.20, subdivision 4; 356.214, subdivision 1; 356.215, subdivision 8; 356.30,
1.14subdivision 3; 356.401, subdivision 3; 356.415, subdivisions 1a, 2; proposing
1.15coding for new law in Minnesota Statutes, chapter 3A; repealing Minnesota
1.16Statutes 2012, sections 3A.02, subdivision 3; 352.045, subdivisions 3, 4;
1.17352.955, subdivision 2; 352C.001; 352C.091, subdivision 1; 352C.10.
1.18BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:
1.22 Section 1. Minnesota Statutes 2012, section 352.22, subdivision 3, is amended to read:
1.23 Subd. 3. Deferred annuity. (a) An employee who has at least three years of
1.24allowable service if employed before July 1, 2010, or who has at least five years of
1.25allowable service if employed after June 30, 2010, when termination occurs may elect
1.26to leave the accumulated contributions in the fund and thereby be entitled to a deferred
1.27retirement annuity. The annuity must be computed under the law in effect when state
1.28service terminated, on the basis of the allowable service credited to the person before
1.29the termination of service.
2.1(b) An employee on layoff or on leave of absence without pay, except a leave of
2.2absence for health reasons, and who does not return to state service must have an annuity,
2.3deferred annuity, or other benefit to which the employee may become entitled computed
2.4under the law in effect on the employee's last working day.
2.5(c) No application for a deferred annuity may be made more than 60 days before
2.6the time the former employee reaches the required age for entitlement to the payment of
2.7the annuity. The deferred annuity begins to accrue no earlier than 60 days before the date
2.8the application is filed in the office of the system, but not (1) before the date on which
2.9the employee reaches the required age for entitlement to the annuity nor (2) before the
2.10day following the termination of state service in a position which is not covered by the
2.11retirement system.
2.12(d) Application for the accumulated contributions left on deposit with the fund may
2.13be made at any time following the date of the termination of service.
2.14(e) Deferred annuities must be augmented as provided in section 352.72, subdivision
2.152.
2.16EFFECTIVE DATE.This section is effective the day following final enactment.
2.17 Sec. 2. Minnesota Statutes 2012, section 352.955, subdivision 1, is amended to read:
2.18 Subdivision 1. Election to transfer prior MSRS-general service credit. (a) An
2.19eligible employee described in paragraph (b) may elect to transfer service credit in the
2.20general state employees retirement plan of the Minnesota State Retirement System to the
2.21correctional state employees retirement plan for eligible prior correctional employment.
2.22 (b) An eligible employee is a person who is covered byLaws 2007, chapter 134,
2.23article 3, section 6, or who became eligible for retirement coverage by the correctional
2.24state employees retirement plan of the Minnesota State Retirement System under Laws
2.252006, chapter 271, article 2, Laws 2007, chapter 134, article 3, or legislation implementing
2.26the recommendations under section352.91, subdivision 4a .
2.27 (c) Eligible prior correctional employment is employment coveredcorrectional
2.28service defined in Laws 2007, chapter 134, article 3, section 6, or is employment by the
2.29Department of Corrections or by the Department of Human Services that preceded the
2.30effective date of the retirement coverage transfer under Laws 2006, chapter 271, article
2.312, Laws 2007, chapter 134, article 3, or legislation implementing the recommendations
2.32under section
352.91, subdivision 4a
2.33the Minnesota State Retirement System, is continuous service, and is certified by the
2.34commissioner of corrections and the commissioner of human services, whichever applies,
2.35and by the commissioner of management and budget to the executive director of the
3.1Minnesota State Retirement System as service that would qualify for correctional state
3.2employees retirement plan coverage under section352.91 , if the service was had been
3.3rendered after the date of coverage transfer.
3.4 (d) The election to transfer past service credit under this section must be made in
3.5writing by the applicable person on a form prescribed by the executive director of the
3.6Minnesota State Retirement System and must be filed with the executive director of the
3.7Minnesota State Retirement System on or before(1) January 1, 2008, or the one year
3.8anniversary of the coverage transfer, whichever is later, or (2) the date of the eligible
3.9employee's termination of state employment, whichever is earlier.
3.10EFFECTIVE DATE.This section is effective the day following final enactment.
3.11 Sec. 3. Minnesota Statutes 2012, section 352.955, subdivision 3, is amended to read:
3.12 Subd. 3. Payment of additional equivalent contributions; post-June 30, 2007,
3.13coverage transfers. (a) An eligible employee who is transferred to plan coverage after
3.14June 30, 2007, and who elects to transfer past service credit under this section must pay
3.15an additional member contribution for that prior service period. The additional member
3.16contribution is the amount computed under paragraph (b), plus the greater of the amount
3.17computed under paragraph (c), or 40 percent of the unfunded actuarial accrued liability
3.18attributable to the past service credit transfer.
3.19 (b) The executive director shall compute, for the most recent 12 months of service
3.20credit eligible for transfer, or for the entire period eligible for transfer if less than 12
3.21months, the difference between the employee contribution rate or rates for the general state
3.22employees retirement plan and the employee contribution rate or rates for the correctional
3.23state employees retirement plan applied to the eligible employee's salary during that
3.24transfer period, plus compound interest at a monthly rate of 0.71 percent.
3.25 (c) The executive director shall compute, for any service credit being transferred
3.26on behalf of the eligible employee and not included under paragraph (b), the difference
3.27between the employee contribution rate or rates for the general state employees retirement
3.28plan and the employee contribution rate or rates for the correctional state employees
3.29retirement plan applied to the eligible employee's salary during that transfer period, plus
3.30compound interest at a monthly rate of 0.71 percent.
3.31 (d) The executive director shall compute an amount using the process specified in
3.32paragraph (b), but based on differences in employer contribution rates between the general
3.33state employees retirement plan and the correctional state employees retirement plan
3.34rather than employee contribution rates.
4.1 (e) The executive director shall compute an amount using the process specified in
4.2paragraph (c), but based on differences in employer contribution rates between the general
4.3state employees retirement plan and the correctional state employees retirement plan
4.4rather than employee contribution rates.
4.5 (f) The additional equivalent member contribution under this subdivision must be
4.6paid in a lump sum. Payment must accompany the election to transfer the prior service
4.7credit. No transfer election or additional equivalent member contribution payment may be
4.8made by a person or accepted by the executive director after the one year anniversary date
4.9of the effective date of the retirement coverage transfer, or the date on which the eligible
4.10employee terminates state employment, whichever is earlier.
4.11 (g) If an eligible employee elects to transfer past service credit under this section
4.12and pays the additional equivalent member contribution amount under paragraph (a), the
4.13applicable department shall pay an additional equivalent employer contribution amount.
4.14The additional employer contribution is the amount computed under paragraph (d), plus
4.15the greater of the amount computed under paragraph (e), or 60 percent of the unfunded
4.16actuarial accrued liability attributable to the past service credit transfer.
4.17 (h) The unfunded actuarial accrued liability attributable to the past service credit
4.18transfer is the present value of the benefit obtained by the transfer of the service credit
4.19to the correctional state employees retirement plan reduced by the amount of the asset
4.20transfer under subdivision 4, by the amount of the member contribution equivalent
4.21payment computed under paragraph (b), and by the amount of the employer contribution
4.22equivalent payment computed under paragraph (d).
4.23 (i) The additional equivalent employer contribution under this subdivision must be
4.24paid in a lump sum and must be paid within 30 days of the date on which the executive
4.25director of the Minnesota State Retirement System certifies to the applicable department
4.26that the employee paid the additional equivalent member contribution.
4.27EFFECTIVE DATE.This section is effective the day following final enactment.
4.28 Sec. 4. Minnesota Statutes 2012, section 352B.011, subdivision 13, is amended to read:
4.29 Subd. 13. Surviving spouse. "Surviving spouse" means a member's or former
4.30member's legally married spousewho resided with the member or former member at the
4.31time of death and was married to the member or former member, for a period of at least
4.32one year, during or before the time of membership.
4.33EFFECTIVE DATE.This section is effective the day following final enactment.
5.1 Sec. 5. REPEALER.
5.2Minnesota Statutes 2012, section 352.955, subdivision 2, is repealed.
5.3EFFECTIVE DATE.This section is effective the day following final enactment.
5.7 Section 1. Minnesota Statutes 2012, section 352.045, is amended by adding a
5.8subdivision to read:
5.9 Subd. 3a. Contribution rate revision; general state employees retirement plan
5.10(a) Notwithstanding the contribution rates stated in plan law, the employee and employer
5.11contribution rates for the general state employees retirement plan must be adjusted:
5.12(1) if the regular actuarial valuation under section 356.215 of the plan indicates that
5.13there is a contribution sufficiency greater than one percent of covered payroll and that the
5.14sufficiency has existed for at least two consecutive years, the employee and employer
5.15contribution rates must be decreased as determined under paragraph (b) to a level such
5.16that the sufficiency is no greater than one percent of covered payroll based on the most
5.17recent actuarial valuation; or
5.18(2) if the regular actuarial valuation under section 352.215 of the plan indicates that
5.19there is a contribution deficiency equal to or greater than 0.5 percent of covered payroll
5.20and that the deficiency has existed for at least two consecutive years, the employee and
5.21employer contribution rates must be increased as determined under paragraph (c) to a level
5.22such that no deficiency exists based on the most recent actuarial valuation.
5.23(b) If the actuarially required contribution of the plan is less than the total support
5.24provided by the combined employee and employer contribution rates by more than one
5.25percent of covered payroll, the plan employee and employer contribution rates must be
5.26decreased incrementally over one or more years by no more than 0.25 percent of pay
5.27each for employee and employer contribution rates to a level such that there remains a
5.28contribution sufficiency of at least one percent of covered payroll. No contribution rate
5.29decrease may be made until at least two years have elapsed since any adjustment under
5.30this paragraph has been fully implemented.
5.31(c) If the actuarially required contribution exceeds the total support provided by the
5.32employee and employer contribution rates, the employee and employer contribution rates
5.33must be increased equally to eliminate that contribution deficiency. If the contribution
5.34deficiency is:
6.1(1) less than two percent, the incremental increase may be up to 0.25 percent each
6.2for the employee and employer contribution rates;
6.3(2) greater than 1.99 percent and less than 4.01 percent, the incremental increase
6.4may be up to 0.5 percent each for the employee and employer contribution rates; or
6.5(3) greater than four percent, the incremental increase may be up to 0.75 percent
6.6each for the employee and employer contribution.
6.7(d) Any recommended adjustment to the contribution rates must be reported to
6.8the chair and the executive director of the Legislative Commission on Pensions and
6.9Retirement by January 15 following receipt of the most recent annual actuarial valuation
6.10prepared under section356.215 . The report must include draft legislation to revise the
6.11employee and employer contributions stated in plan law. If the Legislative Commission
6.12on Pensions and Retirement does not recommend against the rate change or does not
6.13recommend a modification in the rate change, the recommended adjustment becomes
6.14effective on the first day of the first full payroll period in the fiscal year following receipt
6.15of the most recent actuarial valuation that gave rise to the adjustment.
6.16(e) A contribution sufficiency of up to one percent of covered payroll must be held
6.17in reserve to be used to offset any future actuarially required contributions that are more
6.18than the total combined employee and employer contributions.
6.19(f) Before any reduction in contributions to eliminate a sufficiency in excess of one
6.20percent of covered pay may be recommended, the executive director must review any
6.21need for a change in actuarial assumptions, as recommended by the actuary retained under
6.22section356.214 in the most recent experience study of the general employees retirement
6.23plan prepared under section356.215 and the standards for actuarial work promulgated by
6.24the Legislative Commission on Pensions and Retirement that may result in an increase
6.25in the actuarially required contribution and must report to the Legislative Commission
6.26on Pensions and Retirement any recommendation by the board to use the sufficiency
6.27exceeding one percent of covered payroll to offset the impact of an actuarial assumption
6.28change recommended by the actuary retained under section356.214, subdivision 1 , and
6.29reviewed by the actuary retained by the commission under section356.214, subdivision 4 .
6.30(g) No contribution sufficiency in excess of one percent of covered pay may be
6.31proposed to be used to increase benefits, and no benefit increase may be proposed that
6.32would initiate an automatic adjustment to increase contributions under this subdivision.
6.33Any proposed benefit improvement must include a recommendation, prepared by the
6.34actuary retained under section356.214, subdivision 1 , and reviewed by the actuary
6.35retained by the Legislative Commission on Pensions and Retirement as provided under
6.36section356.214, subdivision 4 , on how the benefit modification will be funded.
7.1EFFECTIVE DATE.This section is effective the day following final enactment.
7.2 Sec. 2. Minnesota Statutes 2012, section 352.045, is amended by adding a subdivision
7.3to read:
7.4 Subd. 3b. Contribution rate revision; correctional state employees retirement
7.5plan and State Patrol retirement plan. (a) Subdivision 3a applies to the correctional
7.6state employees retirement plan under this chapter and to the State Patrol retirement plan
7.7established under chapter 352B, except as stated in this subdivision.
7.8(b) Any limitations on the amount of contribution rate changes stated in subdivision
7.93a apply only to the amount of the employee contribution revision. The employer
7.10contribution for the correctional state employees retirement plan or the State Patrol
7.11retirement plan, whichever is applicable, must be adjusted so that the employer
7.12contribution is equal to 60 percent of the sum of employee plus employer contributions.
7.13(c) For the State Patrol retirement plan, a contribution sufficiency of up to two
7.14percent of covered payroll, rather than one percent, may be held in reserves without taking
7.15action to reduce employee and employer contributions.
7.16EFFECTIVE DATE.This section is effective the day following final enactment.
7.17 Sec. 3. Minnesota Statutes 2012, section 352D.04, subdivision 2, is amended to read:
7.18 Subd. 2. Contribution rates. (a) The money used to purchase shares under this
7.19section is the employee and employer contributions provided in this subdivision.
7.20 (b) The employee contribution is an amount equal to the percent of salary specified
7.21in section352.04, subdivision 2 , or
352.045, subdivision 3 3a.
7.22 (c) The employer contribution is an amount equal to six percent of salary.
7.23 (d) For members of the legislature, the contributions under this subdivision also must
7.24be made on per diem payments received during a regular or special legislative session, but
7.25may not be made on per diem payments received outside of a regular or special legislative
7.26session, on the additional compensation attributable to a leadership position under section
7.273.099
, subdivision 3, living expense payments under section
3.101 , or special session
7.28living expense payments under section3.103 .
7.29 (e) For a judge who is a member of the unclassified plan under section352D.02 ,
7.30subdivision 1, paragraph (c), clause (16), the employee contribution rate is eight percent
7.31of salary, and there is no employer contribution.
7.32(f) These contributions must be made in the manner provided in section352.04 ,
7.33subdivisions 4, 5, and 6.
8.1EFFECTIVE DATE.This section is effective the day following final enactment.
8.2 Sec. 4. REPEALER.
8.3Minnesota Statutes 2012, section 352.045, subdivisions 3 and 4, are repealed.
8.4EFFECTIVE DATE.This section is effective the day following final enactment.
8.8 Section 1. Minnesota Statutes 2012, section 3.85, subdivision 10, is amended to read:
8.9 Subd. 10. Standards for pension valuations and cost estimates. The commission
8.10shall adopt standards prescribing specific detailed methods to calculate, evaluate, and
8.11display current and proposed law liabilities, costs, and actuarial equivalents of all public
8.12employee pension plans in Minnesota. These standards shall be consistent with chapter
8.13356 and be updated annually. At a minimum, the standardsmust not shall contain a
8.14valuation requirement requirements that is inconsistent comply with generally accepted
8.15accounting principles applicable to government pension plans. The standards may include
8.16additional financial, funding, or valuation requirements that are not required under
8.17generally accepted accounting principles applicable to government pension plans.
8.18EFFECTIVE DATE.This section is effective the day following final enactment.
8.19 Sec. 2. Minnesota Statutes 2012, section 356.20, subdivision 4, is amended to read:
8.20 Subd. 4. Contents of financial report. (a) The financial report required by
8.21this section must contain financial statements and disclosures that indicate the financial
8.22operations and position of the retirement plan and fund. The report must conform with
8.23generally accepted governmental accounting principles, applied on a consistent basis. The
8.24report must be audited.
8.25 (b) The report must include, as part of its exhibits or its footnotes, an actuarial
8.26disclosure item based on a statement that the actuarial valuation calculations prepared
8.27by the actuary retained under section356.214 or by the actuary retained by the
8.28retirement fund or plan, whichever applies,according to comply with applicable actuarial
8.29requirements enumerated in section356.215 , and specified in the most recent standards
8.30for actuarial work adopted by the Legislative Commission on Pensions and Retirement.
8.31The actuarial value of assets, the actuarial accrued liabilities,including accrued reserves,
8.32 and the unfunded actuarial accrued liability of the fund or plan must be disclosed. The
9.1disclosure item report must contain a declaration certification by the actuary retained
9.2under section356.214 or the actuary retained by the fund or plan, whichever applies,
9.3specifying thatthe required reserves for any retirement, disability, or survivor normal
9.4cost and the actuarial accrued liabilities for all benefitsprovided under a benefit formula
9.5 are computed in accordance with the entry age actuarial cost method and in accordance
9.6with the most recent applicable standards for actuarial work adopted by the Legislative
9.7Commission on Pensions and Retirement.
9.8 (c) The report must contain an itemized exhibit describing the administrative
9.9expenses of the plan, including, but not limited to, the following items, classified on a
9.10consistent basis from year to year, and with any further meaningful detail:
9.11 (1) personnel expenses;
9.12 (2) communication-related expenses;
9.13 (3) office building and maintenance expenses;
9.14 (4) professional services fees; and
9.15 (5) other expenses.
9.16 (d) The report must contain an itemized exhibit describing the investment expenses
9.17of the plan, including, but not limited to, the following items, classified on a consistent
9.18basis from year to year, and with any further meaningful detail:
9.19 (1) internal investment-related expenses; and
9.20 (2) external investment-related expenses.
9.21 (e) Any additional statements or exhibits or more detailed or subdivided itemization
9.22of a disclosure item that will enable the management of the plan to portray a true
9.23interpretation of the plan's financial condition must be included in the additional
9.24statements or exhibits.
9.25EFFECTIVE DATE.This section is effective the day following final enactment.
9.28 Section 1. Minnesota Statutes 2012, section 352.01, subdivision 17b, is amended to read:
9.29 Subd. 17b. Duty disability, physical or psychological. "Duty disability, physical
9.30or psychological," for a correctional employee, means an occupational disability that is
9.31the direct result of an injury incurred during, or a disease arising out of, the performance
9.32of normal duties or the performance of less frequent duties either of whichare present
9.33inherent dangers specific to the correctional employee.
9.34EFFECTIVE DATE.This section is effective the day following final enactment.
10.1 Sec. 2. Minnesota Statutes 2012, section 352.03, subdivision 8, is amended to read:
10.2 Subd. 8. Medical adviser. Thestate commissioner of health or other executive
10.3director may contract with an accredited independent organization specializing in
10.4disability determinations, licensedphysician physicians, or physicians on the staff of the
10.5commissioner of health as designated by the commissionermay designate shall, to be the
10.6medical adviserof to the director system.
10.7EFFECTIVE DATE.This section is effective the day following final enactment.
10.8 Sec. 3. Minnesota Statutes 2012, section 352.113, subdivision 4, is amended to read:
10.9 Subd. 4. Medical or psychological examinations; authorization for payment of
10.10benefit. (a) Any physician, psychologist, chiropractor, or physician assistant providing
10.11any service specified in this section must be licensed.
10.12(b) An applicant shall providemedical, chiropractic, or psychological a detailed
10.13report signed by a physician, and at least one additional report signed by a physician,
10.14chiropractor, psychologist, or physician assistant with evidence to support an application
10.15for total and permanent disability.
10.16(b) The director shall have the employee examined by at least one additional
10.17licensed chiropractor, physician, or psychologist designated by the medical adviser. The
10.18chiropractors, physicians, or psychologists shall make written reports to the director
10.19concerning the employee's disability including must include an expert opinions as to
10.20 opinion regarding whether the employee is permanently and totally disabled within
10.21the meaning of section352.01, subdivision 17 , and that the disability arose before the
10.22employee was placed on any paid or unpaid leave of absence or terminated public service.
10.23(c) If there is medical evidence that supports the expectation that at some point
10.24the person applying for the disability benefit will no longer be disabled, the decision
10.25granting the disability benefit may provide for a termination date upon which the total and
10.26permanent disability can be expected to no longer exist. When a termination date is part
10.27of the decision granting benefits, prior to the benefit termination the executive director
10.28shall review any evidence provided by the disabled employee to show that the disabling
10.29condition for which benefits were initially granted continues. If the benefits cease, the
10.30disabled employee may follow the appeal procedures described in section 356.96 or may
10.31reapply for disability benefits using the process described in this subdivision.
10.32(d) Any claim to disability must be supported by a report from the employer
10.33indicating that there is no available work that the employee can perform with the disabling
10.34condition and that all reasonable accommodations have been considered. Upon request of
10.35the executive director, an employer shall provide evidence of the steps the employer has
11.1taken to attempt to provide reasonable accommodations and continued employment to
11.2the claimant.
11.3(c) (e) The director shall also obtain written certification from the employer
11.4stating whether the employment has ceased or whether the employee is on sick leave of
11.5absence because of a disability that will prevent further service to the employer andas a
11.6consequence that the employee is not entitled to compensation from the employer.
11.7(d) (f) The medical adviser shall consider the reports of the physicians, physician
11.8assistants, psychologists, and chiropractors and any other evidence supplied by the
11.9employee or other interested parties. If the medical adviser finds the employee totally and
11.10permanently disabled, the adviser shall make appropriate recommendation to the director
11.11in writing together with the date from which the employee has been totally disabled. The
11.12director shall then determine if the disability occurred within 18 months of filing the
11.13application, while still in the employment of the state, and the propriety of authorizing
11.14payment of a disability benefit as provided in this section.
11.15(e) (g) A terminated employee may apply for a disability benefit within 18 months of
11.16termination as long as the disability occurred while in the employment of the state. The
11.17fact that an employee is placed on leave of absence without compensation because of
11.18disability does not bar that employee from receiving a disability benefit.
11.19(f) (h) Unless the payment of a disability benefit has terminated because the
11.20employee is no longer totally disabled, or because the employee has reached normal
11.21retirement age as provided in this section, the disability benefit must cease with the last
11.22payment received by the disabled employee or which had accrued during the lifetime of the
11.23employee unless there is a spouse surviving. In that event, the surviving spouse is entitled
11.24to the disability benefit for the calendar month in which the disabled employee died.
11.25EFFECTIVE DATE.This section is effective the day following final enactment.
11.26 Sec. 4. Minnesota Statutes 2012, section 352.113, is amended by adding a subdivision
11.27to read:
11.28 Subd. 4b. Independent medical examination or vocational rehabilitation
11.29counseling. Any individual applying for or receiving disability benefits shall submit
11.30to an independent medical examination or an assessment by a certified rehabilitation
11.31counselor if requested by the executive director or designee. The examination must be
11.32paid for by the system.
11.33 Sec. 5. Minnesota Statutes 2012, section 352.113, subdivision 6, is amended to read:
12.1 Subd. 6. Regular medical or psychological examinations. At least once each
12.2year during the first five years following the allowance of a disability benefit to any
12.3employee, and at least once in every three-year period thereafter, the director may require
12.4any disabled employee toundergo a provide medical, chiropractic, or psychological
12.5examination evidence to support the continuation of the total and permanent disability.
12.6Theexamination must be made at the place of residence of the employee, or at any place
12.7mutually agreed upon, evidence must be in a form and manner prescribed by the executive
12.8director for review by an expert or experts designated by the medical adviser and engaged
12.9by the director. Ifany examination indicates the medical information provided to the
12.10medical adviser indicates that the employee is no longer permanently and totally disabled,
12.11or is engaged in or can engage in a gainful occupation, payments of the disability benefit
12.12by the fund must be discontinued. The payments must be discontinued as soon as the
12.13employee is reinstated to the payroll following a sick leave of absence, but in no case may
12.14payment be made for more than 60 days after the medical adviser finds that the employee
12.15is no longer permanently and totally disabled.
12.16EFFECTIVE DATE.This section is effective the day following final enactment.
12.17 Sec. 6. Minnesota Statutes 2012, section 352.113, subdivision 8, is amended to read:
12.18 Subd. 8. Refusal of examination. If adisabled employee person applying for a
12.19disability benefit refuses to submit toan expert a medical or psychological examination,
12.20the disability application shall be rejected. If a disability benefit recipient refuses to submit
12.21to a medical or psychological examination as required, payments by the fund must be
12.22discontinued and the director shall revoke all rights of the employee in any disability benefit.
12.23EFFECTIVE DATE.This section is effective the day following final enactment.
12.24 Sec. 7. Minnesota Statutes 2012, section 352.113, is amended by adding a subdivision
12.25to read:
12.26 Subd. 14. Disabilitant earnings reports. Disability benefit recipients must report
12.27all earnings from reemployment and income from workers' compensation to the system
12.28annually by May 15 in a format prescribed by the executive director. If the form is not
12.29submitted by June 15, benefits must be suspended effective July 1. If the form deemed
12.30acceptable by the executive director is received after the June 15 deadline, benefits shall
12.31be reinstated retroactive to July 1.
12.32EFFECTIVE DATE.This section is effective the day following final enactment.
13.1 Sec. 8. Minnesota Statutes 2012, section 352B.10, is amended by adding a subdivision
13.2to read:
13.3 Subd. 7. Disabilitant earnings reports. Disability benefit recipients must report
13.4all earnings from reemployment and income from workers' compensation to the system
13.5annually by May 15 in a format prescribed by the executive director. If the form is not
13.6submitted by June 15, benefits must be suspended effective July 1. If the form deemed
13.7acceptable by the executive director is received after the June 15 deadline, benefits shall
13.8be reinstated retroactive to July 1.
13.9EFFECTIVE DATE.This section is effective the day following final enactment.
13.13 Section 1. Minnesota Statutes 2012, section 3A.011, is amended to read:
13.143A.011 ADMINISTRATION OFPLAN PLANS.
13.15 The executive director and the board of directors of the Minnesota State Retirement
13.16System shall administer thelegislators retirement plan plans specified in accordance this
13.17chapter consistent with this chapter andchapter chapters 245 and 356A.
13.18EFFECTIVE DATE.This section is effective July 1, 2013.
13.19 Sec. 2. Minnesota Statutes 2012, section 3A.03, subdivision 3, is amended to read:
13.20 Subd. 3. Legislators retirement fund. (a) The legislators retirement fund, a special
13.21retirement fund, is created within the state treasuryand must be credited with assets equal
13.22to the participation of the legislators retirement plan in the Minnesota postretirement
13.23investment fund as of June 30, 2009, and any investment proceeds on those assets.
13.24(b) The payment of annuities under section3A.115 , paragraph (b), is appropriated
13.25from the legislators retirement fund.
13.26EFFECTIVE DATE.This section is effective July 1, 2013.
13.27 Sec. 3. Minnesota Statutes 2012, section 3A.07, is amended to read:
13.283A.07 APPLICATION.
13.29 (a) Except as provided in paragraph (b) and section 3A.17, this chapter applies
13.30to members of the legislature in service after July 1, 1965, who otherwise meet the
13.31requirements of this chapter.
14.1 (b) Members of the legislature who were elected for the first time after June 30,
14.21997, or members of the legislature who were elected before July 1, 1997, and who, after
14.3July 1, 1998, elect not to be members of the plan established by this chapter are covered
14.4by the unclassified employees retirement program governed by chapter 352D.
14.5 (c) The post-July 1, 1998, coverage election under paragraph (b) is irrevocable
14.6and must be made on a form prescribed by the director. The second chance referendum
14.7election under Laws 2002, chapter 392, article 15, also is irrevocable.
14.8EFFECTIVE DATE.This section is effective July 1, 2013.
14.9 Sec. 4. Minnesota Statutes 2012, section 3A.115, is amended to read:
14.103A.115 RETIREMENT ALLOWANCE APPROPRIATION;
14.11POSTRETIREMENT ADJUSTMENT.
14.12(a) The amount necessary to fund the retirement allowance granted under this
14.13chapter to a former legislator retiring after June 30, 2003, or to that legislator's survivor,
14.14and the retirement allowance granted under section 3A.17 to a former constitutional
14.15officer or the survivor of that constitutional officer is appropriated from the general fund to
14.16the director to pay pension obligations due to the retiree.
14.17(b) The amount necessary to fund the retirement allowance granted under this
14.18chapter to a former legislator retiring before July 1, 2003, must be paid from the legislators
14.19retirement fund created under section3A.03, subdivision 3 , until the assets of the fund
14.20are exhausted and at that time, the amount necessary to fund the retirement allowances
14.21under this paragraph is appropriated from the general fund to the director to pay pension
14.22obligations to the retiree and survivor.
14.23(c) Retirement allowances payable to retired legislators and their survivors under
14.24this chapter must be adjusted as provided in sections3A.02, subdivision 6 , and
356.415 .
14.25EFFECTIVE DATE.This section is effective July 1, 2013.
14.26 Sec. 5. Minnesota Statutes 2012, section 3A.13, is amended to read:
14.273A.13 EXEMPTION FROM PROCESS AND TAXATION; HEALTH
14.28PREMIUM DEDUCTION.
14.29(a) The provisions of section356.401 apply to the legislators retirement plan plans
14.30specified in this chapter.
14.31(b) The executive director of the Minnesota State Retirement System must, at the
14.32request of a retired legislator or constitutional officer who is enrolled in a health insurance
14.33plan covering state employees, deduct the person's health insurance premiums from the
15.1person's annuity and transfer the amount of the premium to a health insurance carrier
15.2covering state employees.
15.3EFFECTIVE DATE.This section is effective July 1, 2013.
15.4 Sec. 6. Minnesota Statutes 2012, section 3A.15, is amended to read:
15.53A.15COORDINATED PROGRAM PROGRAMS OF THE LEGISLATORS
15.6RETIREMENT PLAN.
15.7The coordinated program of the legislators retirement plan is created. The provisions
15.8of sections3A.01 to
3A.13 apply to the coordinated program and basic programs of the
15.9legislators retirement plan.
15.10EFFECTIVE DATE.This section is effective July 1, 2013.
15.12 Sec. 7. [3A.17] CONSTITUTIONAL OFFICERS.
15.13 Subdivision 1. Application. (a) This section specifies the retirement plan applicable
15.14to a former constitutional officer who was first elected to a constitutional office after July
15.151, 1967, and before July 1, 1997. The plan includes the applicable portions of chapter
15.16352C and chapter 356 in effect on the date on which the person terminated active service
15.17as a constitutional officer.
15.18(b) Nothing in this section, this act, or Laws 2006, chapter 271, article 10, section
15.1933, subdivision 2, is intended to increase or reduce the benefits of former constitutional
15.20officers or their survivors or to adversely modify their eligibility for benefits in effect
15.21as of June 30, 2012.
15.22 Subd. 2. Benefit adjustments. Retirement allowances payable to retired
15.23constitutional officers and surviving spouse benefits payable must be adjusted under
15.24section 356.415.
15.25EFFECTIVE DATE.This section is effective July 1, 2013.
15.26 Sec. 8. Minnesota Statutes 2012, section 356.214, subdivision 1, is amended to read:
15.27 Subdivision 1. Actuary retention. (a) The governing board or managing or
15.28administrative official of each public pension plan and retirement fund or plan enumerated
15.29in paragraph (b) shall contract with an established actuarial consulting firm to conduct
15.30annual actuarial valuations and related services. The principal from the actuarial
16.1consulting firm on the contract must be an approved actuary under section356.215,
16.2subdivision 1 , paragraph (c).
16.3 (b) Actuarial services must include the preparation of actuarial valuations and
16.4related actuarial work for the following retirement plans:
16.5 (1) the teachers retirement plan, Teachers Retirement Association;
16.6 (2) the general state employees retirement plan, Minnesota State Retirement System;
16.7 (3) the correctional employees retirement plan, Minnesota State Retirement System;
16.8 (4) the State Patrol retirement plan, Minnesota State Retirement System;
16.9 (5) the judges retirement plan, Minnesota State Retirement System;
16.10 (6) the general employees retirement plan, Public Employees Retirement
16.11Association, including the MERF division;
16.12 (7) the public employees police and fire plan, Public Employees Retirement
16.13Association;
16.14 (8) the Duluth teachers retirement plan, Duluth Teachers Retirement Fund
16.15Association;
16.16 (9) the St. Paul teachers retirement plan, St. Paul Teachers Retirement Fund
16.17Association;
16.18 (10) the legislators retirement plan, Minnesota State Retirement System; and
16.19(11) the elective state officers retirement plan, Minnesota State Retirement System;
16.20and
16.21(12) (11) the local government correctional service retirement plan, Public
16.22Employees Retirement Association.
16.23(c) The actuarial valuation for the legislators retirement plan must include a separate
16.24calculation of total plan actuarial accrued liabilities due to constitutional officer coverage
16.25under section 3A.17.
16.26(c) (d) The contracts must require completion of the annual actuarial valuation
16.27calculations on a fiscal year basis, with the contents of the actuarial valuation calculations
16.28as specified in section356.215 , and in conformity with the standards for actuarial work
16.29adopted by the Legislative Commission on Pensions and Retirement.
16.30 The contracts must require completion of annual experience data collection and
16.31processing and a quadrennial published experience study for the plans listed in paragraph
16.32(b), clauses (1), (2), and (6), as provided for in the standards for actuarial work adopted by
16.33the commission. The experience data collection, processing, and analysis must evaluate
16.34the following:
16.35 (1) individual salary progression;
16.36 (2) the rate of return on investments based on the current asset value;
17.1 (3) payroll growth;
17.2 (4) mortality;
17.3 (5) retirement age;
17.4 (6) withdrawal; and
17.5 (7) disablement.
17.6(d) (e) The actuary shall annually prepare a report to the governing or managing
17.7board or administrative official and the legislature, summarizing the results of the actuarial
17.8valuation calculations. The actuary shall include with the report any recommendations
17.9concerning the appropriateness of the support rates to achieve proper funding of
17.10the retirement plans by the required funding dates. The actuary shall, as part of the
17.11quadrennial experience study, include recommendations on the appropriateness of the
17.12actuarial valuation assumptions required for evaluation in the study.
17.13(e) (f) If the actuarial gain and loss analysis in the actuarial valuation calculations
17.14indicates a persistent pattern of sizable gains or losses, the governing or managing board
17.15or administrative official shall direct the actuary to prepare a special experience study for
17.16a plan listed in paragraph (b), clause (3), (4), (5), (7), (8), (9), (10), (11), or (12), in the
17.17manner provided for in the standards for actuarial work adopted by the commission.
17.18 Sec. 9. Minnesota Statutes 2012, section 356.215, subdivision 8, is amended to read:
17.19 Subd. 8. Interest and salary assumptions. (a) The actuarial valuation must use
17.20the applicable following preretirement interest assumption and the applicable following
17.21postretirement interest assumption:
17.22(1) select and ultimate interest rate assumption
18.4Except for the legislators retirement plan and theelective state constitutional officers
18.5retirement plan calculation of total plan liabilities, the select preretirement interest rate
18.6assumption for the period after June 30, 2012, through June 30, 2017, is 8.0 percent.
18.7Except for the legislators retirement plan and theelective state constitutional officers
18.8retirement plan calculation of total plan liabilities, the select postretirement interest rate
18.9assumption for the period after June 30, 2012, through June 30, 2017, is 5.5 percent,
18.10except for the Duluth teachers retirement plan and the St. Paul teachers retirement plan,
18.11each with a select postretirement interest rate assumption for the period after June 30,
18.122012, through June 30, 2017, of 8.0 percent.
18.13(2) single rate preretirement and postretirement interest rate assumption
18.19 (b) The actuarial valuation must use the applicable following single rate future salary
18.20increase assumption, the applicable following modified single rate future salary increase
18.21assumption, or the applicable following graded rate future salary increase assumption:
18.22 (1) single rate future salary increase assumption
18.28 (2) age-related future salary increase age-related select and ultimate future salary
18.29increase assumption or graded rate future salary increase assumption
18.34For plans other than the Duluth teachers
18.35retirement plan, the select calculation
18.36is: during the designated select period, a
18.37designated percentage rate is multiplied by
19.1the result of the designated integer minus T,
19.2where T is the number of completed years
19.3of service, and is added to the applicable
19.4future salary increase assumption. The
19.5designated select period is ten years and the
19.6designated integer is ten for all retirement
19.7plans covered by this clause. The designated
19.8percentage rate is 0.3 percent for the St. Paul
19.9Teachers Retirement Fund Association. The
19.10select calculation for the Duluth Teachers
19.11Retirement Fund Association is 8.00 percent
19.12per year for service years one through seven,
19.137.25 percent per year for service years seven
19.14and eight, and 6.50 percent per year for
19.15service years eight and nine.
19.16 The ultimate future salary increase assumption is:
20.33(3) service-related ultimate future salary increase assumption
21.34 (c) The actuarial valuation must use the applicable following payroll growth
21.35assumption for calculating the amortization requirement for the unfunded actuarial
21.36accrued liability where the amortization retirement is calculated as a level percentage
21.37of an increasing payroll:
22.8 (d) The assumptions set forth in paragraphs (b) and (c) continue to apply, unless a
22.9different salary assumption or a different payroll increase assumption:
22.10 (1) has been proposed by the governing board of the applicable retirement plan;
22.11 (2) is accompanied by the concurring recommendation of the actuary retained under
22.12section356.214, subdivision 1 , if applicable, or by the approved actuary preparing the
22.13most recent actuarial valuation report if section356.214 does not apply; and
22.14 (3) has been approved or deemed approved under subdivision 18.
22.15EFFECTIVE DATE.This section is effective July 1, 2013.
22.16 Sec. 10. Minnesota Statutes 2012, section 356.30, subdivision 3, is amended to read:
22.17 Subd. 3. Covered plans. This section applies to the following retirement plans:
22.18(1) the general state employees retirement plan of the Minnesota State Retirement
22.19System, established under chapter 352;
22.20(2) the correctional state employees retirement plan of the Minnesota State
22.21Retirement System, established under chapter 352;
22.22(3) the unclassified employees retirement program, established under chapter 352D;
22.23(4) the State Patrol retirement plan, established under chapter 352B;
22.24(5) the legislators retirement plan, established under chapter 3A, including
22.25constitutional officers as specified in that chapter;
22.26(6) the elective state officers retirement plan, established under chapter 352C;
22.27(7) (6) the general employees retirement plan of the Public Employees Retirement
22.28Association, established under chapter 353, including the MERF division of the Public
22.29Employees Retirement Association;
22.30(8) (7) the public employees police and fire retirement plan of the Public Employees
22.31Retirement Association, established under chapter 353;
22.32(9) (8) the local government correctional service retirement plan of the Public
22.33Employees Retirement Association, established under chapter 353E;
22.34(10) (9) the Teachers Retirement Association, established under chapter 354;
22.35(11) (10) the St. Paul Teachers Retirement Fund Association, established under
22.36chapter 354A;
23.1(12) (11) the Duluth Teachers Retirement Fund Association, established under
23.2chapter 354A; and
23.3(13) (12) the judges retirement fund, established by chapter 490.
23.4EFFECTIVE DATE.This section is effective July 1, 2013.
23.5 Sec. 11. Minnesota Statutes 2012, section 356.401, subdivision 3, is amended to read:
23.6 Subd. 3. Covered retirement plans. The provisions of this section apply to the
23.7following retirement plans:
23.8(1) the legislators retirement plan, established by chapter 3A, including constitutional
23.9officers as specified in that chapter;
23.10(2) the general state employees retirement plan of the Minnesota State Retirement
23.11System, established by chapter 352;
23.12(3) the correctional state employees retirement plan of the Minnesota State
23.13Retirement System, established by chapter 352;
23.14(4) the State Patrol retirement plan, established by chapter 352B;
23.15(5) the elective state officers retirement plan, established by chapter 352C;
23.16(6) (5) the unclassified state employees retirement program, established by chapter
23.17352D;
23.18(7) (6) the general employees retirement plan of the Public Employees Retirement
23.19Association, established by chapter 353, including the MERF division of the Public
23.20Employees Retirement Association;
23.21(8) (7) the public employees police and fire plan of the Public Employees Retirement
23.22Association, established by chapter 353;
23.23(9) (8) the public employees defined contribution plan, established by chapter 353D;
23.24(10) (9) the local government correctional service retirement plan of the Public
23.25Employees Retirement Association, established by chapter 353E;
23.26(11) (10) the voluntary statewide lump-sum volunteer firefighter retirement plan,
23.27established by chapter 353G;
23.28(12) (11) the Teachers Retirement Association, established by chapter 354;
23.29(13) (12) the Duluth Teachers Retirement Fund Association, established by chapter
23.30354A;
23.31(14) (13) the St. Paul Teachers Retirement Fund Association, established by chapter
23.32354A;
23.33(15) (14) the individual retirement account plan, established by chapter 354B;
23.34(16) (15) the higher education supplemental retirement plan, established by chapter
23.35354C; and
24.1(17) (16) the judges retirement fund, established by chapter 490.
24.2EFFECTIVE DATE.This section is effective July 1, 2013.
24.3 Sec. 12. Minnesota Statutes 2012, section 356.415, subdivision 1a, is amended to read:
24.4 Subd. 1a. Annual postretirement adjustments; Minnesota State Retirement
24.5System plans other than State Patrol retirement plan. (a) Retirement annuity, disability
24.6benefit, or survivor benefit recipients of the legislators retirementplan plans, including
24.7constitutional officers as specified in chapter 3A, the general state employees retirement
24.8plan, the correctional state employees retirement plan,the elected state officers retirement
24.9plan, the unclassified state employees retirement program, and the judges retirement plan
24.10are entitled to a postretirement adjustment annually on January 1, as follows:
24.11(1) a postretirement increase of two percent must be applied each year, effective
24.12on January 1, to the monthly annuity or benefit of each annuitant or benefit recipient
24.13who has been receiving an annuity or a benefit for at least 18 full months before the
24.14January 1 increase; and
24.15(2) for each annuitant or benefit recipient who has been receiving an annuity or
24.16a benefit for at least six full months, an annual postretirement increase of 1/12 of two
24.17percent for each month that the person has been receiving an annuity or benefit must be
24.18applied, effective January 1, following the calendar year in which the person has been
24.19retired for at least six months, but has been retired for less than 18 months.
24.20(b) The increases provided by this subdivision commence on January 1, 2011.
24.21Increases under this subdivision for the general state employees retirement plan, the
24.22correctional state employees retirement plan, or the judges retirement plan terminate
24.23on December 31 of the calendar year in which the actuarial valuation prepared by the
24.24approved actuary under sections356.214 and
356.215 and the standards for actuarial work
24.25promulgated by the Legislative Commission on Pensions and Retirement indicates that the
24.26market value of assets of the retirement plan equals or exceeds 90 percent of the actuarial
24.27accrued liability of the retirement plan and increases under subdivision 1 recommence
24.28after that date. Increases under this subdivision for the legislators retirement plan or the
24.29elected state officers retirement plan terminate on December 31 of the calendar year in
24.30which the actuarial valuation prepared by the approved actuary under sections356.214 and
24.31356.215
and the standards for actuarial work promulgated by the Legislative Commission
24.32on Pensions and Retirement indicates that the market value of assets of the general state
24.33employees retirement plan equals or exceeds 90 percent of the actuarial accrued liability
24.34of the retirement plan and increases under subdivision 1 recommence after that date.
25.1(c) An increase in annuity or benefit payments under this subdivision must be made
25.2automatically unless written notice is filed by the annuitant or benefit recipient with the
25.3executive director of the applicable covered retirement plan requesting that the increase
25.4not be made.
25.5EFFECTIVE DATE.This section is effective July 1, 2013.
25.6 Sec. 13. Minnesota Statutes 2012, section 356.415, subdivision 2, is amended to read:
25.7 Subd. 2. Covered retirement plans. The provisions of this section apply to the
25.8following retirement plans:
25.9(1) the legislators retirement plan established under chapter 3A, including
25.10constitutional officers as specified in that chapter;
25.11(2) the correctional state employees retirement plan of the Minnesota State
25.12Retirement System established under chapter 352;
25.13(3) the general state employees retirement plan of the Minnesota State Retirement
25.14System established under chapter 352;
25.15(4) the State Patrol retirement plan established under chapter 352B;
25.16(5) the elective state officers retirement plan established under chapter 352C;
25.17(6) (5) the general employees retirement plan of the Public Employees Retirement
25.18Association established under chapter 353, including the MERF division of the Public
25.19Employees Retirement Association;
25.20(7) (6) the public employees police and fire retirement plan of the Public Employees
25.21Retirement Association established under chapter 353;
25.22(8) (7) the local government correctional employees retirement plan of the Public
25.23Employees Retirement Association established under chapter 353E;
25.24(9) (8) the teachers retirement plan established under chapter 354; and
25.25(10) (9) the judges retirement plan established under chapter 490.
25.26EFFECTIVE DATE.This section is effective July 1, 2013.
25.27 Sec. 14. APPLICATION.
25.28Nothing in this act should be interpreted as modifying benefits or benefit eligibility
25.29compared to law in effect immediately before the effective date of this section.
25.30EFFECTIVE DATE.This section is effective July 1, 2013.
25.31 Sec. 15. REPEALER.
26.1Minnesota Statutes 2012, sections 3A.02, subdivision 3; 352C.001; 352C.091,
26.2subdivision 1; and 352C.10, are repealed.
26.3EFFECTIVE DATE.This section is effective July 1, 2013.
1.3language; removing obsolete language; revising outdated requirements; revising
1.4contribution rate revision procedures; revising disability standards and disability
1.5benefit administration procedures; merging the elected state officers retirement
1.6plan into the legislators retirement plan; revising pension commission standards
1.7provision; revising pension plan financial report contents provision; amending
1.8Minnesota Statutes 2012, sections 3.85, subdivision 10; 3A.011; 3A.03,
1.9subdivision 3; 3A.07; 3A.115; 3A.13; 3A.15; 352.01, subdivision 17b; 352.03,
1.10subdivision 8; 352.045, by adding subdivisions; 352.113, subdivisions 4, 6, 8, by
1.11adding subdivisions; 352.22, subdivision 3; 352.955, subdivisions 1, 3; 352B.011,
1.12subdivision 13; 352B.10, by adding a subdivision; 352D.04, subdivision 2;
1.13356.20, subdivision 4; 356.214, subdivision 1; 356.215, subdivision 8; 356.30,
1.14subdivision 3; 356.401, subdivision 3; 356.415, subdivisions 1a, 2; proposing
1.15coding for new law in Minnesota Statutes, chapter 3A; repealing Minnesota
1.16Statutes 2012, sections 3A.02, subdivision 3; 352.045, subdivisions 3, 4;
1.17352.955, subdivision 2; 352C.001; 352C.091, subdivision 1; 352C.10.
1.18BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:
1.22 Section 1. Minnesota Statutes 2012, section 352.22, subdivision 3, is amended to read:
1.23 Subd. 3. Deferred annuity. (a) An employee who has at least three years of
1.24allowable service if employed before July 1, 2010, or who has at least five years of
1.25allowable service if employed after June 30, 2010, when termination occurs may elect
1.26to leave the accumulated contributions in the fund and thereby be entitled to a deferred
1.27retirement annuity. The annuity must be computed under the law in effect when state
1.28service terminated, on the basis of the allowable service credited to the person before
1.29the termination of service.
2.1(b) An employee on layoff or on leave of absence without pay, except a leave of
2.2absence for health reasons, and who does not return to state service must have an annuity,
2.3deferred annuity, or other benefit to which the employee may become entitled computed
2.4under the law in effect on the employee's last working day.
2.5(c) No application for a deferred annuity may be made more than 60 days before
2.6the time the former employee reaches the required age for entitlement to the payment of
2.7the annuity. The deferred annuity begins to accrue no earlier than 60 days before the date
2.8the application is filed in the office of the system, but not (1) before the date on which
2.9the employee reaches the required age for entitlement to the annuity nor (2) before the
2.10day following the termination of state service in a position which is not covered by the
2.11retirement system.
2.12(d) Application for the accumulated contributions left on deposit with the fund may
2.13be made at any time following the date of the termination of service.
2.14(e) Deferred annuities must be augmented as provided in section 352.72, subdivision
2.152.
2.16EFFECTIVE DATE.This section is effective the day following final enactment.
2.17 Sec. 2. Minnesota Statutes 2012, section 352.955, subdivision 1, is amended to read:
2.18 Subdivision 1. Election to transfer prior MSRS-general service credit. (a) An
2.19eligible employee described in paragraph (b) may elect to transfer service credit in the
2.20general state employees retirement plan of the Minnesota State Retirement System to the
2.21correctional state employees retirement plan for eligible prior correctional employment.
2.22 (b) An eligible employee is a person who is covered by
2.23
2.24
2.25
2.26the recommendations under section
2.27 (c) Eligible prior correctional employment is employment covered
2.28
2.29
2.30
2.31
2.32
2.33the Minnesota State Retirement System, is continuous service, and is certified by the
2.34commissioner of corrections and the commissioner of human services, whichever applies,
2.35and by the commissioner of management and budget to the executive director of the
3.1Minnesota State Retirement System as service that would qualify for correctional state
3.2employees retirement plan coverage under section
3.3rendered after the date of coverage transfer.
3.4 (d) The election to transfer past service credit under this section must be made in
3.5writing by the applicable person on a form prescribed by the executive director of the
3.6Minnesota State Retirement System and must be filed with the executive director of the
3.7Minnesota State Retirement System on or before
3.8anniversary of the coverage transfer
3.9employee's termination of state employment, whichever is earlier.
3.10EFFECTIVE DATE.This section is effective the day following final enactment.
3.11 Sec. 3. Minnesota Statutes 2012, section 352.955, subdivision 3, is amended to read:
3.12 Subd. 3. Payment of additional equivalent contributions
3.13
3.14
3.15an additional member contribution for that prior service period. The additional member
3.16contribution is the amount computed under paragraph (b), plus the greater of the amount
3.17computed under paragraph (c), or 40 percent of the unfunded actuarial accrued liability
3.18attributable to the past service credit transfer.
3.19 (b) The executive director shall compute, for the most recent 12 months of service
3.20credit eligible for transfer, or for the entire period eligible for transfer if less than 12
3.21months, the difference between the employee contribution rate or rates for the general state
3.22employees retirement plan and the employee contribution rate or rates for the correctional
3.23state employees retirement plan applied to the eligible employee's salary during that
3.24transfer period, plus compound interest at a monthly rate of 0.71 percent.
3.25 (c) The executive director shall compute, for any service credit being transferred
3.26on behalf of the eligible employee and not included under paragraph (b), the difference
3.27between the employee contribution rate or rates for the general state employees retirement
3.28plan and the employee contribution rate or rates for the correctional state employees
3.29retirement plan applied to the eligible employee's salary during that transfer period, plus
3.30compound interest at a monthly rate of 0.71 percent.
3.31 (d) The executive director shall compute an amount using the process specified in
3.32paragraph (b), but based on differences in employer contribution rates between the general
3.33state employees retirement plan and the correctional state employees retirement plan
3.34rather than employee contribution rates.
4.1 (e) The executive director shall compute an amount using the process specified in
4.2paragraph (c), but based on differences in employer contribution rates between the general
4.3state employees retirement plan and the correctional state employees retirement plan
4.4rather than employee contribution rates.
4.5 (f) The additional equivalent member contribution under this subdivision must be
4.6paid in a lump sum. Payment must accompany the election to transfer the prior service
4.7credit. No transfer election or additional equivalent member contribution payment may be
4.8made by a person or accepted by the executive director after the one year anniversary date
4.9of the effective date of the retirement coverage transfer, or the date on which the eligible
4.10employee terminates state employment, whichever is earlier.
4.11 (g) If an eligible employee elects to transfer past service credit under this section
4.12and pays the additional equivalent member contribution amount under paragraph (a), the
4.13applicable department shall pay an additional equivalent employer contribution amount.
4.14The additional employer contribution is the amount computed under paragraph (d), plus
4.15the greater of the amount computed under paragraph (e), or 60 percent of the unfunded
4.16actuarial accrued liability attributable to the past service credit transfer.
4.17 (h) The unfunded actuarial accrued liability attributable to the past service credit
4.18transfer is the present value of the benefit obtained by the transfer of the service credit
4.19to the correctional state employees retirement plan reduced by the amount of the asset
4.20transfer under subdivision 4, by the amount of the member contribution equivalent
4.21payment computed under paragraph (b), and by the amount of the employer contribution
4.22equivalent payment computed under paragraph (d).
4.23 (i) The additional equivalent employer contribution under this subdivision must be
4.24paid in a lump sum and must be paid within 30 days of the date on which the executive
4.25director of the Minnesota State Retirement System certifies to the applicable department
4.26that the employee paid the additional equivalent member contribution.
4.27EFFECTIVE DATE.This section is effective the day following final enactment.
4.28 Sec. 4. Minnesota Statutes 2012, section 352B.011, subdivision 13, is amended to read:
4.29 Subd. 13. Surviving spouse. "Surviving spouse" means a member's or former
4.30member's legally married spouse
4.31time of death and was married to the member or former member, for a period of at least
4.32one year, during or before the time of membership.
4.33EFFECTIVE DATE.This section is effective the day following final enactment.
5.1 Sec. 5. REPEALER.
5.2Minnesota Statutes 2012, section 352.955, subdivision 2, is repealed.
5.3EFFECTIVE DATE.This section is effective the day following final enactment.
5.7 Section 1. Minnesota Statutes 2012, section 352.045, is amended by adding a
5.8subdivision to read:
5.9 Subd. 3a. Contribution rate revision; general state employees retirement plan
5.10(a) Notwithstanding the contribution rates stated in plan law, the employee and employer
5.11contribution rates for the general state employees retirement plan must be adjusted:
5.12(1) if the regular actuarial valuation under section 356.215 of the plan indicates that
5.13there is a contribution sufficiency greater than one percent of covered payroll and that the
5.14sufficiency has existed for at least two consecutive years, the employee and employer
5.15contribution rates must be decreased as determined under paragraph (b) to a level such
5.16that the sufficiency is no greater than one percent of covered payroll based on the most
5.17recent actuarial valuation; or
5.18(2) if the regular actuarial valuation under section 352.215 of the plan indicates that
5.19there is a contribution deficiency equal to or greater than 0.5 percent of covered payroll
5.20and that the deficiency has existed for at least two consecutive years, the employee and
5.21employer contribution rates must be increased as determined under paragraph (c) to a level
5.22such that no deficiency exists based on the most recent actuarial valuation.
5.23(b) If the actuarially required contribution of the plan is less than the total support
5.24provided by the combined employee and employer contribution rates by more than one
5.25percent of covered payroll, the plan employee and employer contribution rates must be
5.26decreased incrementally over one or more years by no more than 0.25 percent of pay
5.27each for employee and employer contribution rates to a level such that there remains a
5.28contribution sufficiency of at least one percent of covered payroll. No contribution rate
5.29decrease may be made until at least two years have elapsed since any adjustment under
5.30this paragraph has been fully implemented.
5.31(c) If the actuarially required contribution exceeds the total support provided by the
5.32employee and employer contribution rates, the employee and employer contribution rates
5.33must be increased equally to eliminate that contribution deficiency. If the contribution
5.34deficiency is:
6.1(1) less than two percent, the incremental increase may be up to 0.25 percent each
6.2for the employee and employer contribution rates;
6.3(2) greater than 1.99 percent and less than 4.01 percent, the incremental increase
6.4may be up to 0.5 percent each for the employee and employer contribution rates; or
6.5(3) greater than four percent, the incremental increase may be up to 0.75 percent
6.6each for the employee and employer contribution.
6.7(d) Any recommended adjustment to the contribution rates must be reported to
6.8the chair and the executive director of the Legislative Commission on Pensions and
6.9Retirement by January 15 following receipt of the most recent annual actuarial valuation
6.10prepared under section
6.11employee and employer contributions stated in plan law. If the Legislative Commission
6.12on Pensions and Retirement does not recommend against the rate change or does not
6.13recommend a modification in the rate change, the recommended adjustment becomes
6.14effective on the first day of the first full payroll period in the fiscal year following receipt
6.15of the most recent actuarial valuation that gave rise to the adjustment.
6.16(e) A contribution sufficiency of up to one percent of covered payroll must be held
6.17in reserve to be used to offset any future actuarially required contributions that are more
6.18than the total combined employee and employer contributions.
6.19(f) Before any reduction in contributions to eliminate a sufficiency in excess of one
6.20percent of covered pay may be recommended, the executive director must review any
6.21need for a change in actuarial assumptions, as recommended by the actuary retained under
6.22section
6.23plan prepared under section
6.24the Legislative Commission on Pensions and Retirement that may result in an increase
6.25in the actuarially required contribution and must report to the Legislative Commission
6.26on Pensions and Retirement any recommendation by the board to use the sufficiency
6.27exceeding one percent of covered payroll to offset the impact of an actuarial assumption
6.28change recommended by the actuary retained under section
6.29reviewed by the actuary retained by the commission under section
6.30(g) No contribution sufficiency in excess of one percent of covered pay may be
6.31proposed to be used to increase benefits, and no benefit increase may be proposed that
6.32would initiate an automatic adjustment to increase contributions under this subdivision.
6.33Any proposed benefit improvement must include a recommendation, prepared by the
6.34actuary retained under section
6.35retained by the Legislative Commission on Pensions and Retirement as provided under
6.36section
7.1EFFECTIVE DATE.This section is effective the day following final enactment.
7.2 Sec. 2. Minnesota Statutes 2012, section 352.045, is amended by adding a subdivision
7.3to read:
7.4 Subd. 3b. Contribution rate revision; correctional state employees retirement
7.5plan and State Patrol retirement plan. (a) Subdivision 3a applies to the correctional
7.6state employees retirement plan under this chapter and to the State Patrol retirement plan
7.7established under chapter 352B, except as stated in this subdivision.
7.8(b) Any limitations on the amount of contribution rate changes stated in subdivision
7.93a apply only to the amount of the employee contribution revision. The employer
7.10contribution for the correctional state employees retirement plan or the State Patrol
7.11retirement plan, whichever is applicable, must be adjusted so that the employer
7.12contribution is equal to 60 percent of the sum of employee plus employer contributions.
7.13(c) For the State Patrol retirement plan, a contribution sufficiency of up to two
7.14percent of covered payroll, rather than one percent, may be held in reserves without taking
7.15action to reduce employee and employer contributions.
7.16EFFECTIVE DATE.This section is effective the day following final enactment.
7.17 Sec. 3. Minnesota Statutes 2012, section 352D.04, subdivision 2, is amended to read:
7.18 Subd. 2. Contribution rates. (a) The money used to purchase shares under this
7.19section is the employee and employer contributions provided in this subdivision.
7.20 (b) The employee contribution is an amount equal to the percent of salary specified
7.21in section
7.22 (c) The employer contribution is an amount equal to six percent of salary.
7.23 (d) For members of the legislature, the contributions under this subdivision also must
7.24be made on per diem payments received during a regular or special legislative session, but
7.25may not be made on per diem payments received outside of a regular or special legislative
7.26session, on the additional compensation attributable to a leadership position under section
7.28living expense payments under section
7.29 (e) For a judge who is a member of the unclassified plan under section
7.30subdivision 1, paragraph (c), clause (16), the employee contribution rate is eight percent
7.31of salary, and there is no employer contribution.
7.32(f) These contributions must be made in the manner provided in section
7.33subdivisions 4, 5, and 6.
8.1EFFECTIVE DATE.This section is effective the day following final enactment.
8.2 Sec. 4. REPEALER.
8.3Minnesota Statutes 2012, section 352.045, subdivisions 3 and 4, are repealed.
8.4EFFECTIVE DATE.This section is effective the day following final enactment.
8.8 Section 1. Minnesota Statutes 2012, section 3.85, subdivision 10, is amended to read:
8.9 Subd. 10. Standards for pension valuations and cost estimates. The commission
8.10shall adopt standards prescribing specific detailed methods to calculate, evaluate, and
8.11display current and proposed law liabilities, costs, and actuarial equivalents of all public
8.12employee pension plans in Minnesota. These standards shall be consistent with chapter
8.13356 and be updated annually. At a minimum, the standards
8.14
8.15accounting principles applicable to government pension plans. The standards may include
8.16additional financial, funding, or valuation requirements that are not required under
8.17generally accepted accounting principles applicable to government pension plans.
8.18EFFECTIVE DATE.This section is effective the day following final enactment.
8.19 Sec. 2. Minnesota Statutes 2012, section 356.20, subdivision 4, is amended to read:
8.20 Subd. 4. Contents of financial report. (a) The financial report required by
8.21this section must contain financial statements and disclosures that indicate the financial
8.22operations and position of the retirement plan and fund. The report must conform with
8.23generally accepted governmental accounting principles, applied on a consistent basis. The
8.24report must be audited.
8.25 (b) The report must include
8.26
8.27by the actuary retained under section
8.28retirement fund or plan, whichever applies,
8.29requirements enumerated in section
8.30for actuarial work adopted by the Legislative Commission on Pensions and Retirement.
8.31The actuarial value of assets, the actuarial accrued liabilities,
8.32 and the unfunded actuarial accrued liability of the fund or plan must be disclosed. The
9.1
9.2under section
9.3specifying that
9.4cost and the actuarial accrued liabilities for all benefits
9.5 are computed in accordance with the entry age actuarial cost method and in accordance
9.6with the most recent applicable standards for actuarial work adopted by the Legislative
9.7Commission on Pensions and Retirement.
9.8 (c) The report must contain an itemized exhibit describing the administrative
9.9expenses of the plan, including, but not limited to, the following items, classified on a
9.10consistent basis from year to year, and with any further meaningful detail:
9.11 (1) personnel expenses;
9.12 (2) communication-related expenses;
9.13 (3) office building and maintenance expenses;
9.14 (4) professional services fees; and
9.15 (5) other expenses.
9.16 (d) The report must contain an itemized exhibit describing the investment expenses
9.17of the plan, including, but not limited to, the following items, classified on a consistent
9.18basis from year to year, and with any further meaningful detail:
9.19 (1) internal investment-related expenses; and
9.20 (2) external investment-related expenses.
9.21 (e) Any additional statements or exhibits or more detailed or subdivided itemization
9.22of a disclosure item that will enable the management of the plan to portray a true
9.23interpretation of the plan's financial condition must be included in the additional
9.24statements or exhibits.
9.25EFFECTIVE DATE.This section is effective the day following final enactment.
9.28 Section 1. Minnesota Statutes 2012, section 352.01, subdivision 17b, is amended to read:
9.29 Subd. 17b. Duty disability, physical or psychological. "Duty disability, physical
9.30or psychological," for a correctional employee, means an occupational disability that is
9.31the direct result of an injury incurred during, or a disease arising out of, the performance
9.32of normal duties or the performance of less frequent duties either of which
9.33inherent dangers specific to the correctional employee.
9.34EFFECTIVE DATE.This section is effective the day following final enactment.
10.1 Sec. 2. Minnesota Statutes 2012, section 352.03, subdivision 8, is amended to read:
10.2 Subd. 8. Medical adviser. The
10.3director may contract with an accredited independent organization specializing in
10.4disability determinations, licensed
10.5commissioner of health as designated by the commissioner
10.6medical adviser
10.7EFFECTIVE DATE.This section is effective the day following final enactment.
10.8 Sec. 3. Minnesota Statutes 2012, section 352.113, subdivision 4, is amended to read:
10.9 Subd. 4. Medical or psychological examinations; authorization for payment of
10.10benefit. (a) Any physician, psychologist, chiropractor, or physician assistant providing
10.11any service specified in this section must be licensed.
10.12(b) An applicant shall provide
10.13report signed by a physician, and at least one additional report signed by a physician,
10.14chiropractor, psychologist, or physician assistant with evidence to support an application
10.15for total and permanent disability.
10.16
10.17
10.18
10.19
10.20 opinion regarding whether the employee is permanently and totally disabled within
10.21the meaning of section
10.22employee was placed on any paid or unpaid leave of absence or terminated public service.
10.23(c) If there is medical evidence that supports the expectation that at some point
10.24the person applying for the disability benefit will no longer be disabled, the decision
10.25granting the disability benefit may provide for a termination date upon which the total and
10.26permanent disability can be expected to no longer exist. When a termination date is part
10.27of the decision granting benefits, prior to the benefit termination the executive director
10.28shall review any evidence provided by the disabled employee to show that the disabling
10.29condition for which benefits were initially granted continues. If the benefits cease, the
10.30disabled employee may follow the appeal procedures described in section 356.96 or may
10.31reapply for disability benefits using the process described in this subdivision.
10.32(d) Any claim to disability must be supported by a report from the employer
10.33indicating that there is no available work that the employee can perform with the disabling
10.34condition and that all reasonable accommodations have been considered. Upon request of
10.35the executive director, an employer shall provide evidence of the steps the employer has
11.1taken to attempt to provide reasonable accommodations and continued employment to
11.2the claimant.
11.3
11.4stating whether the employment has ceased or whether the employee is on sick leave of
11.5absence because of a disability that will prevent further service to the employer and
11.6
11.7
11.8assistants, psychologists, and chiropractors and any other evidence supplied by the
11.9employee or other interested parties. If the medical adviser finds the employee totally and
11.10permanently disabled, the adviser shall make appropriate recommendation to the director
11.11in writing together with the date from which the employee has been totally disabled. The
11.12director shall then determine if the disability occurred within 18 months of filing the
11.13application, while still in the employment of the state, and the propriety of authorizing
11.14payment of a disability benefit as provided in this section.
11.15
11.16termination as long as the disability occurred while in the employment of the state. The
11.17fact that an employee is placed on leave of absence without compensation because of
11.18disability does not bar that employee from receiving a disability benefit.
11.19
11.20employee is no longer totally disabled, or because the employee has reached normal
11.21retirement age as provided in this section, the disability benefit must cease with the last
11.22payment received by the disabled employee or which had accrued during the lifetime of the
11.23employee unless there is a spouse surviving. In that event, the surviving spouse is entitled
11.24to the disability benefit for the calendar month in which the disabled employee died.
11.25EFFECTIVE DATE.This section is effective the day following final enactment.
11.26 Sec. 4. Minnesota Statutes 2012, section 352.113, is amended by adding a subdivision
11.27to read:
11.28 Subd. 4b. Independent medical examination or vocational rehabilitation
11.29counseling. Any individual applying for or receiving disability benefits shall submit
11.30to an independent medical examination or an assessment by a certified rehabilitation
11.31counselor if requested by the executive director or designee. The examination must be
11.32paid for by the system.
11.33 Sec. 5. Minnesota Statutes 2012, section 352.113, subdivision 6, is amended to read:
12.1 Subd. 6. Regular medical or psychological examinations. At least once each
12.2year during the first five years following the allowance of a disability benefit to any
12.3employee, and at least once in every three-year period thereafter, the director may require
12.4any disabled employee to
12.5
12.6The
12.7
12.8director for review by an expert or experts designated by the medical adviser and engaged
12.9by the director. If
12.10medical adviser indicates that the employee is no longer permanently and totally disabled,
12.11or is engaged in or can engage in a gainful occupation, payments of the disability benefit
12.12by the fund must be discontinued. The payments must be discontinued as soon as the
12.13employee is reinstated to the payroll following a sick leave of absence, but in no case may
12.14payment be made for more than 60 days after the medical adviser finds that the employee
12.15is no longer permanently and totally disabled.
12.16EFFECTIVE DATE.This section is effective the day following final enactment.
12.17 Sec. 6. Minnesota Statutes 2012, section 352.113, subdivision 8, is amended to read:
12.18 Subd. 8. Refusal of examination. If a
12.19disability benefit refuses to submit to
12.20the disability application shall be rejected. If a disability benefit recipient refuses to submit
12.21to a medical or psychological examination as required, payments by the fund must be
12.22discontinued and the director shall revoke all rights of the employee in any disability benefit.
12.23EFFECTIVE DATE.This section is effective the day following final enactment.
12.24 Sec. 7. Minnesota Statutes 2012, section 352.113, is amended by adding a subdivision
12.25to read:
12.26 Subd. 14. Disabilitant earnings reports. Disability benefit recipients must report
12.27all earnings from reemployment and income from workers' compensation to the system
12.28annually by May 15 in a format prescribed by the executive director. If the form is not
12.29submitted by June 15, benefits must be suspended effective July 1. If the form deemed
12.30acceptable by the executive director is received after the June 15 deadline, benefits shall
12.31be reinstated retroactive to July 1.
12.32EFFECTIVE DATE.This section is effective the day following final enactment.
13.1 Sec. 8. Minnesota Statutes 2012, section 352B.10, is amended by adding a subdivision
13.2to read:
13.3 Subd. 7. Disabilitant earnings reports. Disability benefit recipients must report
13.4all earnings from reemployment and income from workers' compensation to the system
13.5annually by May 15 in a format prescribed by the executive director. If the form is not
13.6submitted by June 15, benefits must be suspended effective July 1. If the form deemed
13.7acceptable by the executive director is received after the June 15 deadline, benefits shall
13.8be reinstated retroactive to July 1.
13.9EFFECTIVE DATE.This section is effective the day following final enactment.
13.13 Section 1. Minnesota Statutes 2012, section 3A.011, is amended to read:
13.143A.011 ADMINISTRATION OF
13.15 The executive director and the board of directors of the Minnesota State Retirement
13.16System shall administer the
13.17chapter consistent with this chapter and
13.18EFFECTIVE DATE.This section is effective July 1, 2013.
13.19 Sec. 2. Minnesota Statutes 2012, section 3A.03, subdivision 3, is amended to read:
13.20 Subd. 3. Legislators retirement fund. (a) The legislators retirement fund, a special
13.21retirement fund, is created within the state treasury
13.22
13.23
13.24(b) The payment of annuities under section
13.25from the legislators retirement fund.
13.26EFFECTIVE DATE.This section is effective July 1, 2013.
13.27 Sec. 3. Minnesota Statutes 2012, section 3A.07, is amended to read:
13.283A.07 APPLICATION.
13.29 (a) Except as provided in paragraph (b) and section 3A.17, this chapter applies
13.30to members of the legislature in service after July 1, 1965, who otherwise meet the
13.31requirements of this chapter.
14.1 (b) Members of the legislature who were elected for the first time after June 30,
14.21997, or members of the legislature who were elected before July 1, 1997, and who, after
14.3July 1, 1998, elect not to be members of the plan established by this chapter are covered
14.4by the unclassified employees retirement program governed by chapter 352D.
14.5 (c) The post-July 1, 1998, coverage election under paragraph (b) is irrevocable
14.6and must be made on a form prescribed by the director. The second chance referendum
14.7election under Laws 2002, chapter 392, article 15, also is irrevocable.
14.8EFFECTIVE DATE.This section is effective July 1, 2013.
14.9 Sec. 4. Minnesota Statutes 2012, section 3A.115, is amended to read:
14.103A.115 RETIREMENT ALLOWANCE APPROPRIATION;
14.11POSTRETIREMENT ADJUSTMENT.
14.12(a) The amount necessary to fund the retirement allowance granted under this
14.13chapter to a former legislator retiring after June 30, 2003, or to that legislator's survivor,
14.14and the retirement allowance granted under section 3A.17 to a former constitutional
14.15officer or the survivor of that constitutional officer is appropriated from the general fund to
14.16the director to pay pension obligations due to the retiree.
14.17(b) The amount necessary to fund the retirement allowance granted under this
14.18chapter to a former legislator retiring before July 1, 2003, must be paid from the legislators
14.19retirement fund created under section
14.20are exhausted and at that time, the amount necessary to fund the retirement allowances
14.21under this paragraph is appropriated from the general fund to the director to pay pension
14.22obligations to the retiree and survivor.
14.23(c) Retirement allowances payable to retired legislators and their survivors under
14.24this chapter must be adjusted as provided in sections
14.25EFFECTIVE DATE.This section is effective July 1, 2013.
14.26 Sec. 5. Minnesota Statutes 2012, section 3A.13, is amended to read:
14.273A.13 EXEMPTION FROM PROCESS AND TAXATION; HEALTH
14.28PREMIUM DEDUCTION.
14.29(a) The provisions of section
14.30specified in this chapter.
14.31(b) The executive director of the Minnesota State Retirement System must, at the
14.32request of a retired legislator or constitutional officer who is enrolled in a health insurance
14.33plan covering state employees, deduct the person's health insurance premiums from the
15.1person's annuity and transfer the amount of the premium to a health insurance carrier
15.2covering state employees.
15.3EFFECTIVE DATE.This section is effective July 1, 2013.
15.4 Sec. 6. Minnesota Statutes 2012, section 3A.15, is amended to read:
15.53A.15
15.6RETIREMENT PLAN.
15.7
15.8of sections
15.9legislators retirement plan.
15.10EFFECTIVE DATE.This section is effective July 1, 2013.
15.12 Sec. 7. [3A.17] CONSTITUTIONAL OFFICERS.
15.13 Subdivision 1. Application. (a) This section specifies the retirement plan applicable
15.14to a former constitutional officer who was first elected to a constitutional office after July
15.151, 1967, and before July 1, 1997. The plan includes the applicable portions of chapter
15.16352C and chapter 356 in effect on the date on which the person terminated active service
15.17as a constitutional officer.
15.18(b) Nothing in this section, this act, or Laws 2006, chapter 271, article 10, section
15.1933, subdivision 2, is intended to increase or reduce the benefits of former constitutional
15.20officers or their survivors or to adversely modify their eligibility for benefits in effect
15.21as of June 30, 2012.
15.22 Subd. 2. Benefit adjustments. Retirement allowances payable to retired
15.23constitutional officers and surviving spouse benefits payable must be adjusted under
15.24section 356.415.
15.25EFFECTIVE DATE.This section is effective July 1, 2013.
15.26 Sec. 8. Minnesota Statutes 2012, section 356.214, subdivision 1, is amended to read:
15.27 Subdivision 1. Actuary retention. (a) The governing board or managing or
15.28administrative official of each public pension plan and retirement fund or plan enumerated
15.29in paragraph (b) shall contract with an established actuarial consulting firm to conduct
15.30annual actuarial valuations and related services. The principal from the actuarial
16.1consulting firm on the contract must be an approved actuary under section
16.2subdivision 1
16.3 (b) Actuarial services must include the preparation of actuarial valuations and
16.4related actuarial work for the following retirement plans:
16.5 (1) the teachers retirement plan, Teachers Retirement Association;
16.6 (2) the general state employees retirement plan, Minnesota State Retirement System;
16.7 (3) the correctional employees retirement plan, Minnesota State Retirement System;
16.8 (4) the State Patrol retirement plan, Minnesota State Retirement System;
16.9 (5) the judges retirement plan, Minnesota State Retirement System;
16.10 (6) the general employees retirement plan, Public Employees Retirement
16.11Association, including the MERF division;
16.12 (7) the public employees police and fire plan, Public Employees Retirement
16.13Association;
16.14 (8) the Duluth teachers retirement plan, Duluth Teachers Retirement Fund
16.15Association;
16.16 (9) the St. Paul teachers retirement plan, St. Paul Teachers Retirement Fund
16.17Association;
16.18 (10) the legislators retirement plan, Minnesota State Retirement System; and
16.19
16.20
16.21
16.22Employees Retirement Association.
16.23(c) The actuarial valuation for the legislators retirement plan must include a separate
16.24calculation of total plan actuarial accrued liabilities due to constitutional officer coverage
16.25under section 3A.17.
16.26
16.27calculations on a fiscal year basis, with the contents of the actuarial valuation calculations
16.28as specified in section
16.29adopted by the Legislative Commission on Pensions and Retirement.
16.30 The contracts must require completion of annual experience data collection and
16.31processing and a quadrennial published experience study for the plans listed in paragraph
16.32(b), clauses (1), (2), and (6), as provided for in the standards for actuarial work adopted by
16.33the commission. The experience data collection, processing, and analysis must evaluate
16.34the following:
16.35 (1) individual salary progression;
16.36 (2) the rate of return on investments based on the current asset value;
17.1 (3) payroll growth;
17.2 (4) mortality;
17.3 (5) retirement age;
17.4 (6) withdrawal; and
17.5 (7) disablement.
17.6
17.7board or administrative official and the legislature, summarizing the results of the actuarial
17.8valuation calculations. The actuary shall include with the report any recommendations
17.9concerning the appropriateness of the support rates to achieve proper funding of
17.10the retirement plans by the required funding dates. The actuary shall, as part of the
17.11quadrennial experience study, include recommendations on the appropriateness of the
17.12actuarial valuation assumptions required for evaluation in the study.
17.13
17.14indicates a persistent pattern of sizable gains or losses, the governing or managing board
17.15or administrative official shall direct the actuary to prepare a special experience study for
17.16a plan listed in paragraph (b), clause (3), (4), (5), (7), (8), (9), (10), (11), or (12), in the
17.17manner provided for in the standards for actuarial work adopted by the commission.
17.18 Sec. 9. Minnesota Statutes 2012, section 356.215, subdivision 8, is amended to read:
17.19 Subd. 8. Interest and salary assumptions. (a) The actuarial valuation must use
17.20the applicable following preretirement interest assumption and the applicable following
17.21postretirement interest assumption:
17.22(1) select and ultimate interest rate assumption
18.4Except for the legislators retirement plan and the
18.5
18.6assumption for the period after June 30, 2012, through June 30, 2017, is 8.0 percent.
18.7Except for the legislators retirement plan and the
18.8
18.9assumption for the period after June 30, 2012, through June 30, 2017, is 5.5 percent,
18.10except for the Duluth teachers retirement plan and the St. Paul teachers retirement plan,
18.11each with a select postretirement interest rate assumption for the period after June 30,
18.122012, through June 30, 2017, of 8.0 percent.
18.13(2) single rate preretirement and postretirement interest rate assumption
| 18.14 18.15 |
plan |
interest rate assumption |
|
| 18.16 |
Bloomington Fire Department Relief Association |
6.0 |
|
| 18.17 18.18 |
local monthly benefit volunteer firefighters relief associations |
5.0 |
18.20increase assumption, the applicable following modified single rate future salary increase
18.21assumption, or the applicable following graded rate future salary increase assumption:
18.22 (1) single rate future salary increase assumption
| 18.23 |
plan |
future salary increase assumption |
|
| 18.24 |
legislators retirement plan |
5.0% |
|
| 18.25 |
judges retirement plan |
3.0 |
|
| 18.26 18.27 |
Bloomington Fire Department Relief Association |
4.0 |
|
18.29increase assumption or graded rate future salary increase assumption
18.34For plans other than the Duluth teachers
18.35retirement plan, the select calculation
18.36is: during the designated select period, a
18.37designated percentage rate is multiplied by
19.1the result of the designated integer minus T,
19.2where T is the number of completed years
19.3of service, and is added to the applicable
19.4future salary increase assumption. The
19.5designated select period is ten years and the
19.6designated integer is ten for all retirement
19.7plans covered by this clause. The designated
19.8percentage rate is 0.3 percent for the St. Paul
19.9Teachers Retirement Fund Association. The
19.10select calculation for the Duluth Teachers
19.11Retirement Fund Association is 8.00 percent
19.12per year for service years one through seven,
19.137.25 percent per year for service years seven
19.14and eight, and 6.50 percent per year for
19.15service years eight and nine.
19.16 The ultimate future salary increase assumption is:
20.33(3) service-related ultimate future salary increase assumption
21.34 (c) The actuarial valuation must use the applicable following payroll growth
21.35assumption for calculating the amortization requirement for the unfunded actuarial
21.36accrued liability where the amortization retirement is calculated as a level percentage
21.37of an increasing payroll:
22.8 (d) The assumptions set forth in paragraphs (b) and (c) continue to apply, unless a
22.9different salary assumption or a different payroll increase assumption:
22.10 (1) has been proposed by the governing board of the applicable retirement plan;
22.11 (2) is accompanied by the concurring recommendation of the actuary retained under
22.12section
22.13most recent actuarial valuation report if section
22.14 (3) has been approved or deemed approved under subdivision 18.
22.15EFFECTIVE DATE.This section is effective July 1, 2013.
22.16 Sec. 10. Minnesota Statutes 2012, section 356.30, subdivision 3, is amended to read:
22.17 Subd. 3. Covered plans. This section applies to the following retirement plans:
22.18(1) the general state employees retirement plan of the Minnesota State Retirement
22.19System, established under chapter 352;
22.20(2) the correctional state employees retirement plan of the Minnesota State
22.21Retirement System, established under chapter 352;
22.22(3) the unclassified employees retirement program, established under chapter 352D;
22.23(4) the State Patrol retirement plan, established under chapter 352B;
22.24(5) the legislators retirement plan, established under chapter 3A, including
22.25constitutional officers as specified in that chapter;
22.26
22.27
22.28Association, established under chapter 353, including the MERF division of the Public
22.29Employees Retirement Association;
22.30
22.31Retirement Association, established under chapter 353;
22.32
22.33Employees Retirement Association, established under chapter 353E;
22.34
22.35
22.36chapter 354A;
23.1
23.2chapter 354A; and
23.3
23.4EFFECTIVE DATE.This section is effective July 1, 2013.
23.5 Sec. 11. Minnesota Statutes 2012, section 356.401, subdivision 3, is amended to read:
23.6 Subd. 3. Covered retirement plans. The provisions of this section apply to the
23.7following retirement plans:
23.8(1) the legislators retirement plan, established by chapter 3A, including constitutional
23.9officers as specified in that chapter;
23.10(2) the general state employees retirement plan of the Minnesota State Retirement
23.11System, established by chapter 352;
23.12(3) the correctional state employees retirement plan of the Minnesota State
23.13Retirement System, established by chapter 352;
23.14(4) the State Patrol retirement plan, established by chapter 352B;
23.15
23.16
23.17352D;
23.18
23.19Association, established by chapter 353, including the MERF division of the Public
23.20Employees Retirement Association;
23.21
23.22Association, established by chapter 353;
23.23
23.24
23.25Employees Retirement Association, established by chapter 353E;
23.26
23.27established by chapter 353G;
23.28
23.29
23.30354A;
23.31
23.32354A;
23.33
23.34
23.35354C; and
24.1
24.2EFFECTIVE DATE.This section is effective July 1, 2013.
24.3 Sec. 12. Minnesota Statutes 2012, section 356.415, subdivision 1a, is amended to read:
24.4 Subd. 1a. Annual postretirement adjustments; Minnesota State Retirement
24.5System plans other than State Patrol retirement plan. (a) Retirement annuity, disability
24.6benefit, or survivor benefit recipients of the legislators retirement
24.7constitutional officers as specified in chapter 3A, the general state employees retirement
24.8plan, the correctional state employees retirement plan,
24.9
24.10are entitled to a postretirement adjustment annually on January 1, as follows:
24.11(1) a postretirement increase of two percent must be applied each year, effective
24.12on January 1, to the monthly annuity or benefit of each annuitant or benefit recipient
24.13who has been receiving an annuity or a benefit for at least 18 full months before the
24.14January 1 increase; and
24.15(2) for each annuitant or benefit recipient who has been receiving an annuity or
24.16a benefit for at least six full months, an annual postretirement increase of 1/12 of two
24.17percent for each month that the person has been receiving an annuity or benefit must be
24.18applied, effective January 1, following the calendar year in which the person has been
24.19retired for at least six months, but has been retired for less than 18 months.
24.20(b) The increases provided by this subdivision commence on January 1, 2011.
24.21Increases under this subdivision for the general state employees retirement plan, the
24.22correctional state employees retirement plan, or the judges retirement plan terminate
24.23on December 31 of the calendar year in which the actuarial valuation prepared by the
24.24approved actuary under sections
24.25promulgated by the Legislative Commission on Pensions and Retirement indicates that the
24.26market value of assets of the retirement plan equals or exceeds 90 percent of the actuarial
24.27accrued liability of the retirement plan and increases under subdivision 1 recommence
24.28after that date. Increases under this subdivision for the legislators retirement plan or the
24.29elected state officers retirement plan terminate on December 31 of the calendar year in
24.30which the actuarial valuation prepared by the approved actuary under sections
24.32on Pensions and Retirement indicates that the market value of assets of the general state
24.33employees retirement plan equals or exceeds 90 percent of the actuarial accrued liability
24.34of the retirement plan and increases under subdivision 1 recommence after that date.
25.1(c) An increase in annuity or benefit payments under this subdivision must be made
25.2automatically unless written notice is filed by the annuitant or benefit recipient with the
25.3executive director of the applicable covered retirement plan requesting that the increase
25.4not be made.
25.5EFFECTIVE DATE.This section is effective July 1, 2013.
25.6 Sec. 13. Minnesota Statutes 2012, section 356.415, subdivision 2, is amended to read:
25.7 Subd. 2. Covered retirement plans. The provisions of this section apply to the
25.8following retirement plans:
25.9(1) the legislators retirement plan established under chapter 3A, including
25.10constitutional officers as specified in that chapter;
25.11(2) the correctional state employees retirement plan of the Minnesota State
25.12Retirement System established under chapter 352;
25.13(3) the general state employees retirement plan of the Minnesota State Retirement
25.14System established under chapter 352;
25.15(4) the State Patrol retirement plan established under chapter 352B;
25.16
25.17
25.18Association established under chapter 353, including the MERF division of the Public
25.19Employees Retirement Association;
25.20
25.21Retirement Association established under chapter 353;
25.22
25.23Employees Retirement Association established under chapter 353E;
25.24
25.25
25.26EFFECTIVE DATE.This section is effective July 1, 2013.
25.27 Sec. 14. APPLICATION.
25.28Nothing in this act should be interpreted as modifying benefits or benefit eligibility
25.29compared to law in effect immediately before the effective date of this section.
25.30EFFECTIVE DATE.This section is effective July 1, 2013.
25.31 Sec. 15. REPEALER.
26.1Minnesota Statutes 2012, sections 3A.02, subdivision 3; 352C.001; 352C.091,
26.2subdivision 1; and 352C.10, are repealed.
26.3EFFECTIVE DATE.This section is effective July 1, 2013.
