Bill Text: MN SF1604 | 2011-2012 | 87th Legislature | Introduced
Bill Title: Public employees retirement association (PERA) former Minneapolis police relief association health insurance account transfer
Spectrum: Partisan Bill (Democrat 1-0)
Status: (Introduced - Dead) 2012-01-30 - Referred to State Government Innovation and Veterans [SF1604 Detail]
Download: Minnesota-2011-SF1604-Introduced.html
1.2relating to retirement; former Minneapolis Police Relief Association; providing
1.3for successor custodian for transferred health insurance account assets; amending
1.4Minnesota Statutes 2011 Supplement, section 353.668, subdivision 4.
1.5BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:
1.6 Section 1. Minnesota Statutes 2011 Supplement, section 353.668, subdivision 4,
1.7is amended to read:
1.8 Subd. 4. Transfer of assets; transfer of title to assets. (a) On the effective date of
1.9the consolidation under Laws 2011, First Special Session chapter 8, article 7, section 19,
1.10the chief administrative officer of the Minneapolis Police Relief Association shall transfer
1.11the entire assets of the special fund of the Minneapolis Police Relief Association other
1.12than the health insurance account to the public employees police and fire retirement fund
1.13at market value. Unless ineligible or inappropriate, the transfer must be in the form of
1.14investment securities and must include any accounts receivable that are determined by the
1.15State Board of Investment as being capable of being collected. An amount, in cash, must
1.16be transferred by the city of Minneapolis equal to the market value recognized by the relief
1.17association of investment securities that are determined by the executive director of the
1.18State Board of Investment not to be in compliance with the requirements and limitations
1.19set forth in sections11A.09 ,
11A.14 ,
11A.23 , and
11A.24 or not to be appropriate for
1.20retention in light of the established investment objectives of the State Board of Investment
1.21or of accounts receivable determined by the executive director of the State Board of
1.22Investment as being incapable of being collected. Legal and beneficial title to assets that
1.23are determined noncompliant or inappropriate securities or that are uncollectible accounts
1.24receivable are transferred to the city of Minneapolis on the effective date of consolidation
2.1under Laws 2011, First Special Session chapter 8, article 7, section 19. Any accounts
2.2payable on the effective date of consolidation under Laws 2011, First Special Session
2.3chapter 8, article 7, section 19, are an obligation of the public employees police and fire
2.4retirement fund and reduce the asset value for purposes of subdivision 6. The transferred
2.5assets must be deposited in the public employees police and fire retirement fund. The
2.6amount of the health insurance account as of the date of the consolidation must remain
2.7deposited in the financial institution retained by the former Minneapolis Police Relief
2.8Association on May 1, 2011, and that financial institution must act as the custodian of the
2.9account. The health insurance account may be transferred from the financial institution
2.10that holds the account to a successor financial institution on June 30, 2012, under the
2.11requirements of this subdivision and the terms of an agreement between the Minneapolis
2.12Police Relief Association and the successor financial institution dated December 30,
2.132011, that provides for the transfer. The financial institution shall perform all trustee and
2.14fiduciary duties with respect to the account as a condition to the retention of the account.
2.15The executive director of the Minneapolis Police Relief Association, prior to the effective
2.16date of consolidation, shall estimate three calendar years of the administrative expenses
2.17related to the operation of the account and shall prepay those expenses from the account to
2.18the financial institution prior to the effective date of consolidation. After the three-year
2.19prepayment period, the beneficiaries of the account are responsible for the payment of the
2.20administrative expenses related to the operation of the account.
2.21(b) Upon the transfer of assets to the State Board of Investment under paragraph
2.22(a), legal title to those transferred assets vests with the State Board of Investment on
2.23behalf of the public employees police and fire retirement plan, and beneficial title to the
2.24transferred assets remains with the former membership of the former Minneapolis Police
2.25Relief Association.
2.26(c) The public employees police and fire retirement plan and fund is the successor in
2.27interest to all claims for or against the Minneapolis Police Relief Association. The public
2.28employees police and fire retirement plan and fund is not liable for any claim against the
2.29Minneapolis Police Relief Association, its governing board, or its administrative staff
2.30acting in a fiduciary capacity, under chapter 356A or common law, which is founded upon
2.31a claim of a breach of fiduciary duty if the act or acts constituting the claimed breach were
2.32not undertaken in good faith. The public employees police and fire retirement plan may
2.33assert any applicable defense to any claim in any judicial or administrative proceeding
2.34that the Minneapolis Police Relief Association, its board, or its administrative staff would
2.35otherwise have been entitled to assert, and the public employees police and fire retirement
2.36plan may assert any applicable defense that it has in its capacity as a statewide agency.
3.1(d) The Public Employees Retirement Association shall indemnify any former
3.2fiduciary of the Minneapolis Police Relief Association consistent with the provisions of
3.3section356A.11 . The indemnification may be effected by the purchase by the Public
3.4Employees Retirement Association of reasonable fiduciary liability tail insurance for the
3.5officers and directors of the former Minneapolis Police Relief Association. Consistent
3.6with section69.80 , the relief association may purchase reasonable fiduciary liability tail
3.7insurance for its officers and directors prior to the effective date of consolidation under
3.8Laws 2011, First Special Session chapter 8, article 7, section 19.
3.9(e) Office equipment and other physical assets of the special fund of the Minneapolis
3.10Police Relief Association that are not needed by the Public Employees Retirement
3.11Association may be sold by the special fund of the Minneapolis Police Relief Association
3.12to the general fund of the Minneapolis Police Relief Association or to any successor
3.13fraternal organization of the Minneapolis Police Relief Association at fair market value,
3.14with the proceeds of that sale deposited in the public employees police and fire retirement
3.15fund and included in the transferred asset value under subdivision 6.
3.16EFFECTIVE DATE.This section is effective the day following final enactment.
1.3for successor custodian for transferred health insurance account assets; amending
1.4Minnesota Statutes 2011 Supplement, section 353.668, subdivision 4.
1.5BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:
1.6 Section 1. Minnesota Statutes 2011 Supplement, section 353.668, subdivision 4,
1.7is amended to read:
1.8 Subd. 4. Transfer of assets; transfer of title to assets. (a) On the effective date of
1.9the consolidation under Laws 2011, First Special Session chapter 8, article 7, section 19,
1.10the chief administrative officer of the Minneapolis Police Relief Association shall transfer
1.11the entire assets of the special fund of the Minneapolis Police Relief Association other
1.12than the health insurance account to the public employees police and fire retirement fund
1.13at market value. Unless ineligible or inappropriate, the transfer must be in the form of
1.14investment securities and must include any accounts receivable that are determined by the
1.15State Board of Investment as being capable of being collected. An amount, in cash, must
1.16be transferred by the city of Minneapolis equal to the market value recognized by the relief
1.17association of investment securities that are determined by the executive director of the
1.18State Board of Investment not to be in compliance with the requirements and limitations
1.19set forth in sections
1.20retention in light of the established investment objectives of the State Board of Investment
1.21or of accounts receivable determined by the executive director of the State Board of
1.22Investment as being incapable of being collected. Legal and beneficial title to assets that
1.23are determined noncompliant or inappropriate securities or that are uncollectible accounts
1.24receivable are transferred to the city of Minneapolis on the effective date of consolidation
2.1under Laws 2011, First Special Session chapter 8, article 7, section 19. Any accounts
2.2payable on the effective date of consolidation under Laws 2011, First Special Session
2.3chapter 8, article 7, section 19, are an obligation of the public employees police and fire
2.4retirement fund and reduce the asset value for purposes of subdivision 6. The transferred
2.5assets must be deposited in the public employees police and fire retirement fund. The
2.6amount of the health insurance account as of the date of the consolidation must remain
2.7deposited in the financial institution retained by the former Minneapolis Police Relief
2.8Association on May 1, 2011, and that financial institution must act as the custodian of the
2.9account. The health insurance account may be transferred from the financial institution
2.10that holds the account to a successor financial institution on June 30, 2012, under the
2.11requirements of this subdivision and the terms of an agreement between the Minneapolis
2.12Police Relief Association and the successor financial institution dated December 30,
2.132011, that provides for the transfer. The financial institution shall perform all trustee and
2.14fiduciary duties with respect to the account as a condition to the retention of the account.
2.15The executive director of the Minneapolis Police Relief Association, prior to the effective
2.16date of consolidation, shall estimate three calendar years of the administrative expenses
2.17related to the operation of the account and shall prepay those expenses from the account to
2.18the financial institution prior to the effective date of consolidation. After the three-year
2.19prepayment period, the beneficiaries of the account are responsible for the payment of the
2.20administrative expenses related to the operation of the account.
2.21(b) Upon the transfer of assets to the State Board of Investment under paragraph
2.22(a), legal title to those transferred assets vests with the State Board of Investment on
2.23behalf of the public employees police and fire retirement plan, and beneficial title to the
2.24transferred assets remains with the former membership of the former Minneapolis Police
2.25Relief Association.
2.26(c) The public employees police and fire retirement plan and fund is the successor in
2.27interest to all claims for or against the Minneapolis Police Relief Association. The public
2.28employees police and fire retirement plan and fund is not liable for any claim against the
2.29Minneapolis Police Relief Association, its governing board, or its administrative staff
2.30acting in a fiduciary capacity, under chapter 356A or common law, which is founded upon
2.31a claim of a breach of fiduciary duty if the act or acts constituting the claimed breach were
2.32not undertaken in good faith. The public employees police and fire retirement plan may
2.33assert any applicable defense to any claim in any judicial or administrative proceeding
2.34that the Minneapolis Police Relief Association, its board, or its administrative staff would
2.35otherwise have been entitled to assert, and the public employees police and fire retirement
2.36plan may assert any applicable defense that it has in its capacity as a statewide agency.
3.1(d) The Public Employees Retirement Association shall indemnify any former
3.2fiduciary of the Minneapolis Police Relief Association consistent with the provisions of
3.3section
3.4Employees Retirement Association of reasonable fiduciary liability tail insurance for the
3.5officers and directors of the former Minneapolis Police Relief Association. Consistent
3.6with section
3.7insurance for its officers and directors prior to the effective date of consolidation under
3.8Laws 2011, First Special Session chapter 8, article 7, section 19.
3.9(e) Office equipment and other physical assets of the special fund of the Minneapolis
3.10Police Relief Association that are not needed by the Public Employees Retirement
3.11Association may be sold by the special fund of the Minneapolis Police Relief Association
3.12to the general fund of the Minneapolis Police Relief Association or to any successor
3.13fraternal organization of the Minneapolis Police Relief Association at fair market value,
3.14with the proceeds of that sale deposited in the public employees police and fire retirement
3.15fund and included in the transferred asset value under subdivision 6.
3.16EFFECTIVE DATE.This section is effective the day following final enactment.
