Bill Text: MN SF1802 | 2013-2014 | 88th Legislature | Introduced
Bill Title: St. Paul teachers retirement fund association full funding date revision, new state aid program and appropriation
Sponsorship: Partisan Bill (Democrat 1)
Status: (Introduced - Dead) 2014-02-25 - Referred to State and Local Government [SF1802 Detail]
Download: Minnesota-2013-SF1802-Introduced.html
1.2relating to retirement; St. Paul Teachers Retirement Fund Association; revising
1.3the date for full funding; creating a new state aid program; appropriating money;
1.4amending Minnesota Statutes 2012, section 356.215, subdivision 11; Minnesota
1.5Statutes 2013 Supplement, section 354A.12, subdivisions 3a, 3c.
1.6BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:
1.7 Section 1. Minnesota Statutes 2013 Supplement, section 354A.12, subdivision 3a,
1.8is amended to read:
1.9 Subd. 3a.Special Direct state aid to first class city teachers retirement fund
1.10associations. (a) The state shall pay $346,000 as special direct state aid to the Duluth
1.11Teachers Retirement Fund Association and $2,827,000 to the St. Paul Teachers Retirement
1.12Fund Association.
1.13(b) In addition to other amounts specified in this subdivision, the state shall pay
1.14$7,000,000 as state aid to the St. Paul Teachers Retirement Fund Association.
1.15(b) (c) The aids under this subdivision are payable October 1 annually. The
1.16commissioner of management and budget shall pay the aids specified in this subdivision.
1.17The amounts required are appropriated annually from the general fund to the commissioner
1.18of management and budget.
1.19EFFECTIVE DATE.This section is effective September 30, 2015.
1.20 Sec. 2. Minnesota Statutes 2013 Supplement, section 354A.12, subdivision 3c, is
1.21amended to read:
1.22 Subd. 3c. Termination of supplemental contributions and direct matching
1.23and state aid. (a) The supplemental contributions payable to the St. Paul Teachers
2.1Retirement Fund Association by Independent School District No. 625 under section
2.2423A.02, subdivision 3
, and all forms of state aid under subdivision 3a to the St. Paul
2.3Teachers Retirement Fund Association must continue until the current assets of the fund
2.4equal or exceed the actuarial accrued liability of the fund as determined in the most recent
2.5actuarial report for the fund by the actuary retained under section356.214 or until June
2.630, 2037 the established date for full funding under section 356.215, subdivision 11,
2.7whichever occurs earlier.
2.8(b) The aid to the Duluth Teachers Retirement Fund Association under section
2.9423A.02, subdivision 3
, and all forms of state aid under subdivision 3a to the Duluth
2.10Teachers Retirement Fund Association must continue until the current assets of the fund
2.11equal or exceed the actuarial accrued liability of the fund as determined in the most
2.12recent actuarial report for the fund by the actuary retained under section356.214 or until
2.13the established date for full funding under section356.215, subdivision 11 , whichever
2.14occurs earlier.
2.15EFFECTIVE DATE.This section is effective the day following final enactment.
2.16 Sec. 3. Minnesota Statutes 2012, section 356.215, subdivision 11, is amended to read:
2.17 Subd. 11. Amortization contributions. (a) In addition to the exhibit indicating
2.18the level normal cost, the actuarial valuation of the retirement plan must contain an
2.19exhibit for financial reporting purposes indicating the additional annual contribution
2.20sufficient to amortize the unfunded actuarial accrued liability and must contain an exhibit
2.21for contribution determination purposes indicating the additional contribution sufficient
2.22to amortize the unfunded actuarial accrued liability. For the retirement plans listed in
2.23subdivision 8, paragraph (c), but excluding the MERF division of the Public Employees
2.24Retirement Association and the legislators retirement plan, the additional contribution
2.25must be calculated on a level percentage of covered payroll basis by the established
2.26date for full funding in effect when the valuation is prepared, assuming annual payroll
2.27growth at the applicable percentage rate set forth in subdivision 8, paragraph (c). For all
2.28other retirement plans and for the MERF division of the Public Employees Retirement
2.29Association and the legislators retirement plan, the additional annual contribution must be
2.30calculated on a level annual dollar amount basis.
2.31 (b) For any retirement plan other than the general state employees retirement plan
2.32of the Minnesota State Retirement System or a retirement plan governed by paragraph
2.33(d), (e), (f), (g), (h), (i), or (j), if there has not been a change in the actuarial assumptions
2.34used for calculating the actuarial accrued liability of the fund, a change in the benefit
2.35plan governing annuities and benefits payable from the fund, a change in the actuarial
3.1cost method used in calculating the actuarial accrued liability of all or a portion of the
3.2fund, or a combination of the three, which change or changes by itself or by themselves
3.3without inclusion of any other items of increase or decrease produce a net increase in the
3.4unfunded actuarial accrued liability of the fund, the established date for full funding is the
3.5first actuarial valuation date occurring after June 1, 2020.
3.6 (c) For any retirement plan other than the general employees retirement plan of the
3.7Public Employees Retirement Association, if there has been a change in any or all of the
3.8actuarial assumptions used for calculating the actuarial accrued liability of the fund, a
3.9change in the benefit plan governing annuities and benefits payable from the fund, a
3.10change in the actuarial cost method used in calculating the actuarial accrued liability of all
3.11or a portion of the fund, or a combination of the three, and the change or changes, by itself
3.12or by themselves and without inclusion of any other items of increase or decrease, produce
3.13a net increase in the unfunded actuarial accrued liability in the fund, the established date
3.14for full funding must be determined using the following procedure:
3.15 (i) the unfunded actuarial accrued liability of the fund must be determined in
3.16accordance with the plan provisions governing annuities and retirement benefits and the
3.17actuarial assumptions in effect before an applicable change;
3.18 (ii) the level annual dollar contribution or level percentage, whichever is applicable,
3.19needed to amortize the unfunded actuarial accrued liability amount determined under item
3.20(i) by the established date for full funding in effect before the change must be calculated
3.21using the interest assumption specified in subdivision 8 in effect before the change;
3.22 (iii) the unfunded actuarial accrued liability of the fund must be determined in
3.23accordance with any new plan provisions governing annuities and benefits payable from
3.24the fund and any new actuarial assumptions and the remaining plan provisions governing
3.25annuities and benefits payable from the fund and actuarial assumptions in effect before
3.26the change;
3.27 (iv) the level annual dollar contribution or level percentage, whichever is applicable,
3.28needed to amortize the difference between the unfunded actuarial accrued liability amount
3.29calculated under item (i) and the unfunded actuarial accrued liability amount calculated
3.30under item (iii) over a period of 30 years from the end of the plan year in which the
3.31applicable change is effective must be calculated using the applicable interest assumption
3.32specified in subdivision 8 in effect after any applicable change;
3.33 (v) the level annual dollar or level percentage amortization contribution under item
3.34(iv) must be added to the level annual dollar amortization contribution or level percentage
3.35calculated under item (ii);
4.1 (vi) the period in which the unfunded actuarial accrued liability amount determined
4.2in item (iii) is amortized by the total level annual dollar or level percentage amortization
4.3contribution computed under item (v) must be calculated using the interest assumption
4.4specified in subdivision 8 in effect after any applicable change, rounded to the nearest
4.5integral number of years, but not to exceed 30 years from the end of the plan year in which
4.6the determination of the established date for full funding using the procedure set forth in this
4.7clause is made and not to be less than the period of years beginning in the plan year in which
4.8the determination of the established date for full funding using the procedure set forth in
4.9this clause is made and ending by the date for full funding in effect before the change; and
4.10 (vii) the period determined under item (vi) must be added to the date as of which
4.11the actuarial valuation was prepared and the date obtained is the new established date
4.12for full funding.
4.13 (d) For the MERF division of the Public Employees Retirement Association, the
4.14established date for full funding is June 30, 2031.
4.15 (e) For the general employees retirement plan of the Public Employees Retirement
4.16Association, the established date for full funding is June 30, 2031.
4.17 (f) For the Teachers Retirement Association, the established date for full funding is
4.18June 30, 2037.
4.19 (g) For the correctional state employees retirement plan of the Minnesota State
4.20Retirement System, the established date for full funding is June 30, 2038.
4.21 (h) For the judges retirement plan, the established date for full funding is June
4.2230, 2038.
4.23 (i) For the public employees police and fire retirement plan, the established date
4.24for full funding is June 30, 2038.
4.25 (j) For the St. Paul Teachers Retirement Fund Association, the established date for
4.26full funding is June 30of the 25th year from the valuation date, 2042. In addition to
4.27other requirements of this chapter, the annual actuarial valuation must contain an exhibit
4.28indicating the funded ratio and the deficiency or sufficiency in annual contributions when
4.29comparing liabilities to the market value of the assets of the fund as of the close of the
4.30most recent fiscal year.
4.31(k) For the general state employees retirement plan of the Minnesota State
4.32Retirement System, the established date for full funding is June 30, 2040.
4.33 (l) For the retirement plans for which the annual actuarial valuation indicates an
4.34excess of valuation assets over the actuarial accrued liability, the valuation assets in
4.35excess of the actuarial accrued liability must be recognized as a reduction in the current
4.36contribution requirements by an amount equal to the amortization of the excess expressed
5.1as a level percentage of pay over a 30-year period beginning anew with each annual
5.2actuarial valuation of the plan.
5.3EFFECTIVE DATE.This section is effective the day following final enactment.
1.3the date for full funding; creating a new state aid program; appropriating money;
1.4amending Minnesota Statutes 2012, section 356.215, subdivision 11; Minnesota
1.5Statutes 2013 Supplement, section 354A.12, subdivisions 3a, 3c.
1.6BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:
1.7 Section 1. Minnesota Statutes 2013 Supplement, section 354A.12, subdivision 3a,
1.8is amended to read:
1.9 Subd. 3a.
1.10associations. (a) The state shall pay $346,000 as special direct state aid to the Duluth
1.11Teachers Retirement Fund Association and $2,827,000 to the St. Paul Teachers Retirement
1.12Fund Association.
1.13(b) In addition to other amounts specified in this subdivision, the state shall pay
1.14$7,000,000 as state aid to the St. Paul Teachers Retirement Fund Association.
1.15
1.16commissioner of management and budget shall pay the aids specified in this subdivision.
1.17The amounts required are appropriated annually from the general fund to the commissioner
1.18of management and budget.
1.19EFFECTIVE DATE.This section is effective September 30, 2015.
1.20 Sec. 2. Minnesota Statutes 2013 Supplement, section 354A.12, subdivision 3c, is
1.21amended to read:
1.22 Subd. 3c. Termination of supplemental contributions and direct matching
1.23and state aid. (a) The supplemental contributions payable to the St. Paul Teachers
2.1Retirement Fund Association by Independent School District No. 625 under section
2.3Teachers Retirement Fund Association must continue until the current assets of the fund
2.4equal or exceed the actuarial accrued liability of the fund as determined in the most recent
2.5actuarial report for the fund by the actuary retained under section
2.6
2.7whichever occurs earlier.
2.8(b) The aid to the Duluth Teachers Retirement Fund Association under section
2.10Teachers Retirement Fund Association must continue until the current assets of the fund
2.11equal or exceed the actuarial accrued liability of the fund as determined in the most
2.12recent actuarial report for the fund by the actuary retained under section
2.13the established date for full funding under section
2.14occurs earlier.
2.15EFFECTIVE DATE.This section is effective the day following final enactment.
2.16 Sec. 3. Minnesota Statutes 2012, section 356.215, subdivision 11, is amended to read:
2.17 Subd. 11. Amortization contributions. (a) In addition to the exhibit indicating
2.18the level normal cost, the actuarial valuation of the retirement plan must contain an
2.19exhibit for financial reporting purposes indicating the additional annual contribution
2.20sufficient to amortize the unfunded actuarial accrued liability and must contain an exhibit
2.21for contribution determination purposes indicating the additional contribution sufficient
2.22to amortize the unfunded actuarial accrued liability. For the retirement plans listed in
2.23subdivision 8, paragraph (c), but excluding the MERF division of the Public Employees
2.24Retirement Association and the legislators retirement plan, the additional contribution
2.25must be calculated on a level percentage of covered payroll basis by the established
2.26date for full funding in effect when the valuation is prepared, assuming annual payroll
2.27growth at the applicable percentage rate set forth in subdivision 8, paragraph (c). For all
2.28other retirement plans and for the MERF division of the Public Employees Retirement
2.29Association and the legislators retirement plan, the additional annual contribution must be
2.30calculated on a level annual dollar amount basis.
2.31 (b) For any retirement plan other than the general state employees retirement plan
2.32of the Minnesota State Retirement System or a retirement plan governed by paragraph
2.33(d), (e), (f), (g), (h), (i), or (j), if there has not been a change in the actuarial assumptions
2.34used for calculating the actuarial accrued liability of the fund, a change in the benefit
2.35plan governing annuities and benefits payable from the fund, a change in the actuarial
3.1cost method used in calculating the actuarial accrued liability of all or a portion of the
3.2fund, or a combination of the three, which change or changes by itself or by themselves
3.3without inclusion of any other items of increase or decrease produce a net increase in the
3.4unfunded actuarial accrued liability of the fund, the established date for full funding is the
3.5first actuarial valuation date occurring after June 1, 2020.
3.6 (c) For any retirement plan other than the general employees retirement plan of the
3.7Public Employees Retirement Association, if there has been a change in any or all of the
3.8actuarial assumptions used for calculating the actuarial accrued liability of the fund, a
3.9change in the benefit plan governing annuities and benefits payable from the fund, a
3.10change in the actuarial cost method used in calculating the actuarial accrued liability of all
3.11or a portion of the fund, or a combination of the three, and the change or changes, by itself
3.12or by themselves and without inclusion of any other items of increase or decrease, produce
3.13a net increase in the unfunded actuarial accrued liability in the fund, the established date
3.14for full funding must be determined using the following procedure:
3.15 (i) the unfunded actuarial accrued liability of the fund must be determined in
3.16accordance with the plan provisions governing annuities and retirement benefits and the
3.17actuarial assumptions in effect before an applicable change;
3.18 (ii) the level annual dollar contribution or level percentage, whichever is applicable,
3.19needed to amortize the unfunded actuarial accrued liability amount determined under item
3.20(i) by the established date for full funding in effect before the change must be calculated
3.21using the interest assumption specified in subdivision 8 in effect before the change;
3.22 (iii) the unfunded actuarial accrued liability of the fund must be determined in
3.23accordance with any new plan provisions governing annuities and benefits payable from
3.24the fund and any new actuarial assumptions and the remaining plan provisions governing
3.25annuities and benefits payable from the fund and actuarial assumptions in effect before
3.26the change;
3.27 (iv) the level annual dollar contribution or level percentage, whichever is applicable,
3.28needed to amortize the difference between the unfunded actuarial accrued liability amount
3.29calculated under item (i) and the unfunded actuarial accrued liability amount calculated
3.30under item (iii) over a period of 30 years from the end of the plan year in which the
3.31applicable change is effective must be calculated using the applicable interest assumption
3.32specified in subdivision 8 in effect after any applicable change;
3.33 (v) the level annual dollar or level percentage amortization contribution under item
3.34(iv) must be added to the level annual dollar amortization contribution or level percentage
3.35calculated under item (ii);
4.1 (vi) the period in which the unfunded actuarial accrued liability amount determined
4.2in item (iii) is amortized by the total level annual dollar or level percentage amortization
4.3contribution computed under item (v) must be calculated using the interest assumption
4.4specified in subdivision 8 in effect after any applicable change, rounded to the nearest
4.5integral number of years, but not to exceed 30 years from the end of the plan year in which
4.6the determination of the established date for full funding using the procedure set forth in this
4.7clause is made and not to be less than the period of years beginning in the plan year in which
4.8the determination of the established date for full funding using the procedure set forth in
4.9this clause is made and ending by the date for full funding in effect before the change; and
4.10 (vii) the period determined under item (vi) must be added to the date as of which
4.11the actuarial valuation was prepared and the date obtained is the new established date
4.12for full funding.
4.13 (d) For the MERF division of the Public Employees Retirement Association, the
4.14established date for full funding is June 30, 2031.
4.15 (e) For the general employees retirement plan of the Public Employees Retirement
4.16Association, the established date for full funding is June 30, 2031.
4.17 (f) For the Teachers Retirement Association, the established date for full funding is
4.18June 30, 2037.
4.19 (g) For the correctional state employees retirement plan of the Minnesota State
4.20Retirement System, the established date for full funding is June 30, 2038.
4.21 (h) For the judges retirement plan, the established date for full funding is June
4.2230, 2038.
4.23 (i) For the public employees police and fire retirement plan, the established date
4.24for full funding is June 30, 2038.
4.25 (j) For the St. Paul Teachers Retirement Fund Association, the established date for
4.26full funding is June 30
4.27other requirements of this chapter, the annual actuarial valuation must contain an exhibit
4.28indicating the funded ratio and the deficiency or sufficiency in annual contributions when
4.29comparing liabilities to the market value of the assets of the fund as of the close of the
4.30most recent fiscal year.
4.31(k) For the general state employees retirement plan of the Minnesota State
4.32Retirement System, the established date for full funding is June 30, 2040.
4.33 (l) For the retirement plans for which the annual actuarial valuation indicates an
4.34excess of valuation assets over the actuarial accrued liability, the valuation assets in
4.35excess of the actuarial accrued liability must be recognized as a reduction in the current
4.36contribution requirements by an amount equal to the amortization of the excess expressed
5.1as a level percentage of pay over a 30-year period beginning anew with each annual
5.2actuarial valuation of the plan.
5.3EFFECTIVE DATE.This section is effective the day following final enactment.
