Bill Text: MN SF277 | 2013-2014 | 88th Legislature | Introduced
Bill Title: Public employees retirement association (PERA) student employee and extended duration of excluded work-study positions coverage clarification, military service credit purchase provision revision for federal code consistency, average salary clarification for benefit purposes, Minneapolis employees retirement fund (MERF) division benefit eligibility clarification, and PERA privatized hospital benefits for Lake County Sunrise Home employees
Sponsorship: Partisan Bill (Democrat 1)
Status: (Introduced - Dead) 2013-02-06 - Referred to State and Local Government [SF277 Detail]
Download: Minnesota-2013-SF277-Introduced.html
1.2relating to retirement; Public Employees Retirement Association; clarifying
1.3coverage of student employees and extending duration of excluded work-study
1.4positions; revising military service credit purchase provision for consistency with
1.5federal code; clarifying average salary for benefit purposes; clarifying MERF
1.6division benefit eligibility; adding Lake County Sunrise Home to privatization
1.7chapter; making other administrative changes; amending Minnesota Statutes
1.82012, sections 353.01, subdivisions 2b, 16, 17a, 29; 353.27, subdivision 7;
1.9353.34, subdivisions 1, 2; 353.50, subdivisions 3, 6; 353.657, subdivisions 2, 2a,
1.103; 353F.02, subdivision 4; 356.635, subdivision 1.
1.11BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:
1.12 Section 1. Minnesota Statutes 2012, section 353.01, subdivision 2b, is amended to read:
1.13 Subd. 2b. Excluded employees. (a) The following public employees are not eligible
1.14to participate as members of the association with retirement coverage by the general
1.15employees retirement plan, the local government correctional employees retirement plan
1.16under chapter 353E, or the public employees police and fire retirement plan:
1.17 (1) persons whose salary from one governmental subdivision never exceeds $425 in
1.18a month;
1.19(2) public officers who are elected to a governing body, city mayors, or persons who
1.20are appointed to fill a vacancy in an elective office of a governing body, whose term of office
1.21commences on or after July 1, 2002, for the service to be rendered in that elective position;
1.22 (3) election officers or election judges;
1.23 (4) patient and inmate personnel who perform services for a governmental
1.24subdivision;
1.25 (5) except as otherwise specified in subdivision 12a, employees who are hired for
1.26a temporary position as defined under subdivision 12a, and employees who resign from
2.1a nontemporary position and accept a temporary position within 30 days in the same
2.2governmental subdivision;
2.3 (6) employees who are employed by reason of work emergency caused by fire,
2.4flood, storm, or similar disaster;
2.5 (7) employees who by virtue of their employment in one governmental subdivision
2.6are required by law to be a member of and to contribute to any of the plans or funds
2.7administered by the Minnesota State Retirement System, the Teachers Retirement
2.8Association, the Duluth Teachers Retirement Fund Association, the St. Paul Teachers
2.9Retirement Fund Association, or any police or firefighters relief association governed by
2.10section69.77 that has not consolidated with the Public Employees Retirement Association,
2.11or any local police or firefighters consolidation account who have not elected the type of
2.12benefit coverage provided by the public employees police and fire fund under sections
2.13353A.01
to
353A.10 , or any persons covered by section
353.665, subdivision 4 , 5, or 6,
2.14who have not elected public employees police and fire plan benefit coverage. This clause
2.15must not be construed to prevent a person from being a member of and contributing to
2.16the Public Employees Retirement Association and also belonging to and contributing to
2.17another public pension plan or fund for other service occurring during the same period
2.18of time. A person who meets the definition of "public employee" in subdivision 2 by
2.19virtue of other service occurring during the same period of time becomes a member of the
2.20association unless contributions are made to another public retirement fund on the salary
2.21based on the other service or to the Teachers Retirement Association by a teacher as
2.22defined in section354.05, subdivision 2 ;
2.23 (8) persons who are members of a religious order and are excluded from coverage
2.24under the federal Old Age, Survivors, Disability, and Health Insurance Program for the
2.25performance of service as specified in United States Code, title 42, section 410(a)(8)(A),
2.26as amended through January 1, 1987, if no irrevocable election of coverage has been made
2.27under section 3121(r) of the Internal Revenue Code of 1954, as amended;
2.28 (9) employees of a governmental subdivision who have not reached the age of
2.2923 and are enrolled on a full-time basis to attend or are attending classes on a full-time
2.30basis at an accredited school, college, or university in an undergraduate, graduate, or
2.31professional-technical program, or a public or charter high school;
2.32 (10) resident physicians, medical interns, and pharmacist residents and pharmacist
2.33interns who are serving in a degree or residency program in public hospitals or clinics;
2.34 (11) students who are serving for up to five years in an internship or residency program
2.35sponsored by a governmental subdivision, including an accredited educational institution;
3.1 (12) persons who hold a part-time adult supplementary technical college license who
3.2render part-time teaching service in a technical college;
3.3 (13) except for employees of Hennepin County or Hennepin Healthcare System, Inc.,
3.4foreign citizens who are employed by a governmental subdivision under a work permit, or
3.5an H-1b visa initially issued or extended for a combined period less than three years of
3.6employment. Upon extension of the employment beyond the three-year period, the foreign
3.7citizens must be reported for membership beginning the first of the month thereafter
3.8provided the monthly earnings threshold as provided under subdivision 2a is met;
3.9 (14) public hospital employees who elected not to participate as members of the
3.10association before 1972 and who did not elect to participate from July 1, 1988, to October
3.111, 1988;
3.12 (15) except as provided in section353.86 , volunteer ambulance service personnel, as
3.13defined in subdivision 35, but persons who serve as volunteer ambulance service personnel
3.14may still qualify as public employees under subdivision 2 and may be members of the
3.15Public Employees Retirement Association and participants in the general employees
3.16retirement plan or the public employees police and fire plan, whichever applies, on the
3.17basis of compensation received from public employment service other than service as
3.18volunteer ambulance service personnel;
3.19 (16) except as provided in section353.87 , volunteer firefighters, as defined in
3.20subdivision 36, engaging in activities undertaken as part of volunteer firefighter duties,
3.21but a person who is a volunteer firefighter may still qualify as a public employee under
3.22subdivision 2 and may be a member of the Public Employees Retirement Association and
3.23a participant in the general employees retirement plan or the public employees police
3.24and fire plan, whichever applies, on the basis of compensation received from public
3.25employment activities other than those as a volunteer firefighter;
3.26 (17) pipefitters and associated trades personnel employed by Independent School
3.27District No. 625, St. Paul, with coverage under a collective bargaining agreement by the
3.28pipefitters local 455 pension plan who were either first employed after May 1, 1997, or,
3.29if first employed before May 2, 1997, elected to be excluded under Laws 1997, chapter
3.30241, article 2, section 12;
3.31 (18) electrical workers, plumbers, carpenters, and associated trades personnel who
3.32are employed by Independent School District No. 625, St. Paul, or the city of St. Paul,
3.33who have retirement coverage under a collective bargaining agreement by the Electrical
3.34Workers Local 110 pension plan, the United Association Plumbers Local 34 pension plan,
3.35or the pension plan applicable to Carpenters Local 87 who were either first employed after
4.1May 1, 2000, or, if first employed before May 2, 2000, elected to be excluded under
4.2Laws 2000, chapter 461, article 7, section 5;
4.3 (19) bricklayers, allied craftworkers, cement masons, glaziers, glassworkers,
4.4painters, allied tradesworkers, and plasterers who are employed by the city of St. Paul
4.5or Independent School District No. 625, St. Paul, with coverage under a collective
4.6bargaining agreement by the Bricklayers and Allied Craftworkers Local 1 pension plan,
4.7the Cement Masons Local 633 pension plan, the Glaziers and Glassworkers Local L-1324
4.8pension plan, the Painters and Allied Trades Local 61 pension plan, or the Twin Cities
4.9Plasterers Local 265 pension plan who were either first employed after May 1, 2001, or if
4.10first employed before May 2, 2001, elected to be excluded under Laws 2001, First Special
4.11Session chapter 10, article 10, section 6;
4.12 (20) plumbers who are employed by the Metropolitan Airports Commission, with
4.13coverage under a collective bargaining agreement by the Plumbers Local 34 pension plan,
4.14who either were first employed after May 1, 2001, or if first employed before May 2,
4.152001, elected to be excluded under Laws 2001, First Special Session chapter 10, article
4.1610, section 6;
4.17 (21) employees who are hired after June 30, 2002, to fill seasonal positions under
4.18subdivision 12b which are limited in duration by the employer to 185 consecutive calendar
4.19days or less in each year of employment with the governmental subdivision;
4.20 (22) persons who are provided supported employment or work-study positions by a
4.21governmental subdivision and who participate in an employment or industries program
4.22maintained for the benefit of these persons where the governmental subdivision limits
4.23the position's duration up tothree five years or less, including persons participating in a
4.24federal or state subsidized on-the-job training, work experience, senior citizen, youth, or
4.25unemployment relief program where the training or work experience is not provided as a
4.26part of, or for, future permanent public employment;
4.27 (23) independent contractors and the employees of independent contractors;
4.28 (24) reemployed annuitants of the association during the course of that
4.29reemployment; and
4.30(25) persons appointed to serve on a board or commission of a governmental
4.31subdivision or an instrumentality thereof.
4.32(b) Any person performing the duties of a public officer in a position defined in
4.33subdivision 2a, paragraph (a), clause (3), is not an independent contractor and is not an
4.34employee of an independent contractor.
4.35EFFECTIVE DATE.This section is effective the day following final enactment.
5.1 Sec. 2. Minnesota Statutes 2012, section 353.01, subdivision 16, is amended to read:
5.2 Subd. 16. Allowable service; limits and computation. (a) "Allowable service"
5.3means:
5.4 (1) service during years of actual membership in the course of which employee
5.5deductions were withheld from salary and contributions were made at the applicable rates
5.6under section353.27 ,
353.65 , or
353E.03 ;
5.7(2) periods of service covered by payments in lieu of salary deductions under
5.8sections353.27, subdivision 12 , and
353.35 ;
5.9 (3) service in years during which the public employee was not a member but for
5.10which the member later elected, while a member, to obtain credit by making payments to
5.11the fund as permitted by any law then in effect;
5.12 (4) a period of authorized leave of absence with pay from which deductions for
5.13employee contributions are made, deposited, and credited to the fund;
5.14 (5) a period of authorized personal, parental, or medical leave of absence without
5.15pay, including a leave of absence covered under the federal Family Medical Leave Act,
5.16that does not exceed one year, and for which a member obtained service credit for each
5.17month in the leave period by payment under section353.0161 to the fund made in place of
5.18salary deductions. An employee must return to public service and render a minimum of
5.19three months of allowable service in order to be eligible to make payment under section
5.20353.0161
for a subsequent authorized leave of absence without pay. Upon payment, the
5.21employee must be granted allowable service credit for the purchased period;
5.22 (6) a periodic, repetitive leave that is offered to all employees of a governmental
5.23subdivision. The leave program may not exceed 208 hours per annual normal work cycle
5.24as certified to the association by the employer. A participating member obtains service
5.25credit by making employee contributions in an amount or amounts based on the member's
5.26average salary, excluding overtime pay, that would have been paid if the leave had not been
5.27taken. The employer shall pay the employer and additional employer contributions on
5.28behalf of the participating member. The employee and the employer are responsible to pay
5.29interest on their respective shares at the rate of 8.5 percent a year, compounded annually,
5.30from the end of the normal cycle until full payment is made. An employer shall also make
5.31the employer and additional employer contributions, plus 8.5 percent interest, compounded
5.32annually, on behalf of an employee who makes employee contributions but terminates
5.33public service. The employee contributions must be made within one year after the end of
5.34the annual normal working cycle or within 30 days after termination of public service,
5.35whichever is sooner. The executive director shall prescribe the manner and forms to be
6.1used by a governmental subdivision in administering a periodic, repetitive leave. Upon
6.2payment, the member must be granted allowable service credit for the purchased period;
6.3 (7) an authorized temporary or seasonal layoff under subdivision 12, limited to three
6.4months allowable service per authorized temporary or seasonal layoff in one calendar year.
6.5An employee who has received the maximum service credit allowed for an authorized
6.6temporary or seasonal layoff must return to public service and must obtain a minimum of
6.7three months of allowable service subsequent to the layoff in order to receive allowable
6.8service for a subsequent authorized temporary or seasonal layoff;
6.9 (8) a period during which a member is absent from employment by a governmental
6.10subdivision by reason of service in the uniformed services, as defined in United States
6.11Code, title 38, section 4303(13), if the member returns to public service with the same
6.12governmental subdivision upon discharge from service in the uniformed service within the
6.13time frames required under United States Code, title 38, section 4312(e), provided that
6.14the member did not separate from uniformed service with a dishonorable or bad conduct
6.15discharge or under other than honorable conditions. The service must be credited if the
6.16member pays into the fund equivalent employee contributions based upon the contribution
6.17rate or rates in effect at the time that the uniformed service was performed multiplied
6.18by the full and fractional years being purchased and applied to the annual salary rate.
6.19The annual salary rate is the average annual salary, excluding overtime pay, during the
6.20purchase period that the member would have received if the member had continued to
6.21be employed in covered employment rather than to provide uniformed service, or, if
6.22the determination of that rate is not reasonably certain, the annual salary rate is the
6.23member's average salary rate, excluding overtime pay, during the 12-month period of
6.24covered employment rendered immediately preceding the period of the uniformed service.
6.25Payment of the member equivalent contributions must be made during a period that begins
6.26with the date on which the individual returns to public employment and that is three times
6.27the length of the military leave period, or within five years of the date of discharge from
6.28the military service, whichever is less. If the determined payment period is less than
6.29one year, the contributions required under this clause to receive service credit may be
6.30made within one year of the discharge date. Payment may not be accepted following 30
6.31days after termination of public service under subdivision 11a. If the member equivalent
6.32contributions provided for in this clause are not paid in full, the member's allowable
6.33service credit must be prorated by multiplying the full and fractional number of years of
6.34uniformed service eligible for purchase by the ratio obtained by dividing the total member
6.35contributions received by the total member contributions otherwise required under this
6.36clause. The equivalent employer contribution, and, if applicable, the equivalent additional
7.1employer contribution must be paid by the governmental subdivision employing the
7.2member if the member makes the equivalent employee contributions. The employer
7.3payments must be made from funds available to the employing unit, using the employer
7.4and additional employer contribution rate or rates in effect at the time that the uniformed
7.5service was performed, applied to the same annual salary rate or rates used to compute the
7.6equivalent member contribution. The governmental subdivision involved may appropriate
7.7money for those payments. The amount of service credit obtainable under this section may
7.8not exceed five years unless a longer purchase period is required under United States Code,
7.9title 38, section 4312. The employing unit shall pay interest on all equivalent member and
7.10employer contribution amounts payable under this clause. Interest must be computed at a
7.11rate of 8.5 percent compounded annually from the end of each fiscal year of the leave or the
7.12break in service to the end of the month in which the payment is received. Upon payment,
7.13the employee must be granted allowable service credit for the purchased period; or
7.14(9) a period specified under section353.0162 .
7.15 (b) For calculating benefits under sections353.30 ,
353.31 ,
353.32 , and
353.33 for
7.16state officers and employees displaced by the Community Corrections Act, chapter 401,
7.17and transferred into county service under section401.04 , "allowable service" means the
7.18combined years of allowable service as defined in paragraph (a), clauses (1) to (6), and
7.19section352.01, subdivision 11 .
7.20 (c) For a public employee who has prior service covered by a local police or
7.21firefighters relief association that has consolidated with the Public Employees Retirement
7.22Association under chapter 353A or to which section353.665 applies, and who has
7.23elected the type of benefit coverage provided by the public employees police and fire
7.24fund either under section353A.08 following the consolidation or under section
353.665,
7.25subdivision 4 , "allowable service" is a period of service credited by the local police or
7.26firefighters relief association as of the effective date of the consolidation based on law
7.27and on bylaw provisions governing the relief association on the date of the initiation
7.28of the consolidation procedure.
7.29 (d) No member may receive more than 12 months of allowable service credit in a
7.30year either for vesting purposes or for benefit calculation purposes. For an active member
7.31who was an active member of the former Minneapolis Firefighters Relief Association
7.32on December 29, 2011, "allowable service" is the period of service credited by the
7.33Minneapolis Firefighters Relief Association as reflected in the transferred records of the
7.34association up to December 30, 2011, and the period of service credited under paragraph
7.35(a), clause (1), after December 30, 2011. For an active member who was an active member
7.36of the former Minneapolis Police Relief Association on December 29, 2011, "allowable
8.1service" is the period of service credited by the Minneapolis Police Relief Association as
8.2reflected in the transferred records of the association up to December 30, 2011, and the
8.3period of service credited under paragraph (a), clause (1), after December 30, 2011.
8.4 (e) MS 2002 [Expired]
8.5EFFECTIVE DATE.This section is effective the day following final enactment.
8.6 Sec. 3. Minnesota Statutes 2012, section 353.01, subdivision 17a, is amended to read:
8.7 Subd. 17a. Average salary. (a) "Average salary,"for purposes of calculating a
8.8retirement annuity under section
353.29, subdivision 3
8.9an amount equivalent to the average of the highest salary of the member, police officer,
8.10or firefighter, whichever applies, upon which employee contributions were paid for any
8.11five successive years of allowable service, based on dates of salary periods as listed on
8.12salary deduction reports. Average salary must be based upon all allowable service if
8.13this service is less than five years.
8.14(b) "Average salary" may not include any reduced salary paid during a period
8.15in which the employee is entitled to benefit payments from workers' compensation for
8.16temporary disability, unless the average salary is higher, including this period.
8.17(c) "Average salary," for purposes of calculating benefits for a surviving spouse or
8.18dependent children under section 353.657, subdivision 2 or 3, means the average of the
8.19full-time monthly base salary rate in effect during the last six months of allowable service.
8.20If the employment during the last six months of allowable service was part-time, the
8.21average salary must be prorated based on the actual number of hours worked.
8.22EFFECTIVE DATE.This section is effective the day following final enactment.
8.23 Sec. 4. Minnesota Statutes 2012, section 353.01, subdivision 29, is amended to read:
8.24 Subd. 29. Designated beneficiary. "Designated beneficiary" means the personor,
8.25 organization, trust, or estate designated by a member, former member,disabilitant, or
8.26retired member in writing, signed and filed with the association before the death of the
8.27member, former member, disabilitant, or retired member, or a person legally authorized
8.28to act on behalf of the member or former member to receive a refund of the balance of
8.29the member's or former member's accumulated deductions after death. A beneficiary
8.30designation is valid if it is made in the form prescribed by the executive director and
8.31is received by the association on or before the date of death of the member or former
8.32member. If a beneficiary designation is deemed to be invalid for any reason, any remaining
9.1balance of the member's or former member's accumulated deductions are subject to the
9.2provisions of section 353.32, subdivisions 4 and 5.
9.3EFFECTIVE DATE.This section is effective the day following final enactment.
9.4 Sec. 5. Minnesota Statutes 2012, section 353.27, subdivision 7, is amended to read:
9.5 Subd. 7. Adjustment for erroneous receipts or disbursements. (a) Except
9.6as provided in paragraph (b), erroneous employee deductions and erroneous employer
9.7contributions and additional employer contributions to the general employees retirement
9.8plan of the Public Employees Retirement Association or to the public employees police
9.9and fire retirement plan for a person who otherwise does not qualify for membership
9.10under this chapter, are considered:
9.11(1) valid if the initial erroneous deduction began before January 1, 1990. Upon
9.12determination of the error by the association, the person may continue membership in the
9.13association while employed in the same position for which erroneous deductions were
9.14taken, or file a written election to terminate membership and apply for a refund upon
9.15termination of public service or defer an annuity under section353.34 ; or
9.16(2) invalid, if the initial erroneous employee deduction began on or after January 1,
9.171990. Upon determination of the error, the association shall refund all erroneous employee
9.18deductions and all erroneous employer contributions as specified in paragraph (e). No
9.19person may claim a right to continued or past membership in the association based on
9.20erroneous deductions which began on or after January 1, 1990.
9.21(b) Erroneous deductions taken from the salary of a person who did not qualify
9.22for membership in the general employees retirement plan of the Public Employees
9.23Retirement Association or in the public employees police and fire retirement plan by
9.24virtue of concurrent employment before July 1, 1978, which required contributions to
9.25another retirement fund or relief association established for the benefit of officers and
9.26employees of a governmental subdivision, are invalid. Upon discovery of the error,
9.27allowable service credit for all invalid service if forfeited and, upon termination of public
9.28service, the association shall refund all erroneous employee deductions to the person, with
9.29interest as determined under section353.34, subdivision 2 , and all erroneous employer
9.30contributions without interest to the employer. This paragraph has both retroactive and
9.31prospective application.
9.32(c) Adjustments to correct employer contributions and employee deductions taken
9.33in error from amounts which are not salary under section353.01, subdivision 10 , must
9.34be made as specified in paragraph (e). The period of adjustment must be limited to the
10.1fiscal year in which the error is discovered by the association and the immediate two
10.2preceding fiscal years.
10.3(d) If there is evidence of fraud or other misconduct on the part of the employee or
10.4the employer, the board of trustees may authorize adjustments to the account of a member
10.5or former member to correct erroneous employee deductions and employer contributions
10.6on invalid salary and the recovery of any overpayments for a period longer than provided
10.7for under paragraph (c).
10.8(e) Upon discovery of the receipt of erroneous employee deductions and employer
10.9contributions under paragraph (a), clause (2), or paragraph (c), the association must require
10.10the employer to discontinue the erroneous employee deductions and erroneous employer
10.11contributions reported on behalf of a member. Upon discontinuation, the association must:
10.12(1) for a member, provide a refund in the amount of the invalid employee deductions
10.13with interest on the invalid employee deductions at the rate specified under section353.34,
10.14subdivision 2 , from the received date of each invalid salary transaction through the date
10.15the credit or refund is made;
10.16(2) for a former member who:
10.17(i) is not receiving a retirement annuity or benefit, return the erroneous employee
10.18deductions to the former member through a refund with interest at the rate specified under
10.19section353.34, subdivision 2 , from the received date of each invalid salary transaction
10.20through the date the credit or refund is made; or
10.21(ii) is receiving a retirement annuity or disability benefit, or a person who is
10.22receiving an optional annuity or survivor benefit, for whom it has been determined an
10.23overpayment must be recovered, adjust the payment amount and recover the overpayments
10.24as provided under this section; and
10.25(3) return the invalid employer contributions reported on behalf of a member or
10.26former member to the employer by providing a credit against future contributions payable
10.27by the employer.
10.28(f) In the event that a salary warrant or check from which a deduction for the
10.29retirement fund was taken has been canceled or the amount of the warrant or check
10.30returned to the funds of the department making the payment, a refund of the sum
10.31deducted, or any portion of it that is required to adjust the deductions, must be made
10.32to the department or institution.
10.33(g) If theaccrual date of any association discovers that a retirement annuity, survivor
10.34benefit, or disability benefitis within the limitation period specified in paragraph (c), and
10.35an overpayment has resulted has been incorrectly calculated by using invalid service or
10.36salary, or due to any erroneous calculation procedure, the association must recalculate
11.1the annuity or benefit payable andrecover any begin payment of the corrected annuity or
11.2benefit effective the first of the month following discovery of the error. Any overpayment
11.3resulting from the incorrect calculation must be recovered as provided under subdivision
11.47b, if the accrual date, or any adjustment in the amount of the annuity or benefit calculated
11.5after the accrual date, except adjustments required under section 353.656, subdivision 4,
11.6falls within the current fiscal year and the two immediate previous fiscal years.
11.7(h) Notwithstanding the provisions of this subdivision, the association may apply
11.8the Revenue Procedures defined in the federal Internal Revenue Service Employee Plans
11.9Compliance Resolution System and not issue a refund of erroneous employee deductions
11.10and employer contributions or not recover a small overpayment of benefits if the cost to
11.11correct the error would exceed the amount of the member refund or overpayment.
11.12(i) Any fees or penalties assessed by the federal Internal Revenue Service for any
11.13failure by an employer to follow the statutory requirements for reporting eligible members
11.14and salary must be paid by the employer.
11.15EFFECTIVE DATE.This section is effective the day following final enactment.
11.16 Sec. 6. Minnesota Statutes 2012, section 353.34, subdivision 1, is amended to read:
11.17 Subdivision 1. Refund or deferred annuity. (a) A former member is entitled to
11.18either a refund of accumulated employee deductions under subdivision 2, or to a deferred
11.19annuity under subdivision 3. Application for a refund may not be made before the date of
11.20termination of public service.Except as specified in paragraph (b), A refund must be paid
11.21within 120 days following receipt of the application unless the applicant has again become
11.22a public employee required to be covered by the association.
11.23(b) If an individual was placed on layoff under section353.01 , subdivision 12 or 12c,
11.24a refund is not payable before termination of service under section353.01, subdivision 11a .
11.25(c) An individual who terminates public service covered by the Public Employees
11.26Retirement Association general employees retirement plan, the MERF division, the Public
11.27Employees Retirement Association police and fire retirement plan, or the public employees
11.28local government correctional service retirement plan, and who is employed by a different
11.29employer and who becomes an active member covered by one of the other two plans, may
11.30receive a refund of employee contributions plus annual compound interest from the plan
11.31from which the member terminated service at the applicable rate specified in subdivision 2.
11.32EFFECTIVE DATE.This section is effective the day following final enactment.
11.33 Sec. 7. Minnesota Statutes 2012, section 353.34, subdivision 2, is amended to read:
12.1 Subd. 2. Refund with interest. (a) Except as provided in subdivision 1, any person
12.2who ceases to be a public employee is entitled to receive a refund in an amount equal to
12.3accumulated deductions with annual compound interest to the first day of the month
12.4in which the refund is processed.
12.5(b) For a person who ceases to be a public employee before July 1, 2011, the refund
12.6interest is at the rate of six percent to June 30, 2011, and at the rate of four percent after
12.7June 30, 2011. For a person who ceases to be a public employee after July 1, 2011, the
12.8refund interest is at the rate of four percent.
12.9(c) If a person repays a refund and subsequently applies for another refund, the
12.10repayment amount, including interest, is added to the fiscal year balance in which the
12.11repayment was made.
12.12(d) If the refund payable to a member is based on employee deductions that are
12.13determined to be invalid under section 353.27, subdivision 7, the interest payable on the
12.14invalid employee deductions is four percent.
12.15EFFECTIVE DATE.This section is effective the day following final enactment.
12.16 Sec. 8. Minnesota Statutes 2012, section 353.50, subdivision 3, is amended to read:
12.17 Subd. 3. Service credit and benefit liability transfer. (a) All allowable service
12.18credit and salary credit of the members of the Minneapolis Employees Retirement Fund
12.19as specified in the records of the Minneapolis Employees Retirement Fund through June
12.2030, 2010, are transferred to the MERF division of the Public Employees Retirement
12.21Association and are credited by the MERF division.Annuities or benefits of persons
12.22who are active members of the former Minneapolis Employees Retirement Fund on
12.23June 30, 2010, must be calculated under Minnesota Statutes 2008, sections
422A.11;
12.24422A.12;
422A.13;
422A.14;
422A.15;
422A.151;
422A.155;
422A.156;
422A.16;
12.25422A.17;
422A.18;
422A.19;
422A.20; and
422A.23, but are only eligible for automatic
12.26postretirement adjustments after December 31, 2010, under section
356.415.
12.27(b) The liability for the payment of annuities and benefits of the Minneapolis
12.28Employees Retirement Fund retirees and benefit recipients as specified in the records of
12.29the Minneapolis Employees Retirement Fund on June 29, 2010, is transferred to the
12.30MERF division of the Public Employees Retirement Association on June 30, 2010.
12.31EFFECTIVE DATE.This section is effective the day following final enactment.
12.32 Sec. 9. Minnesota Statutes 2012, section 353.50, subdivision 6, is amended to read:
13.1 Subd. 6. Benefits. (a) Retired, disabled, deferred, and inactive member benefits.
13.2The annuities and benefits of, or attributable to, retired, disabled, deferred, or inactive
13.3Minneapolis Employees Retirement Fund members with that status as of June 30, 2010,
13.4with the exception of post-December 31, 2010, postretirement adjustments, which
13.5are governed by paragraph (b), as calculated under Minnesota Statutes 2008, sections
13.6422A.11
;
422A.12 ;
422A.13 ;
422A.14 ;
422A.15 ;
422A.151 ;
422A.155 ;
422A.156 ;
13.7422A.16
;
422A.17 ;
422A.18 ;
422A.19 ;
422A.20 ; and
422A.23 , continue in force after the
13.8administrative consolidation under Laws 2010, chapter 359, article 11.
13.9(b) Benefits; benefit eligibility for June 30, 2010, active members. Persons who
13.10were active members of the former Minneapolis Employees Retirement Fund on June
13.1130, 2010, upon satisfying eligibility requirements stated in the applicable sections of
13.12Minnesota Statutes 2008 specified in paragraph (a), are entitled to annuities or benefits
13.13specified in those sections. Eligibility for a formula retirement annuity includes the
13.14requirement in Minnesota Statutes 2008, sections 422A.13 and 422A.16, that the
13.15terminating member has attained retirement age, which is age 60 if the person has at least
13.16ten years of service credit, or any age if the person has 30 or more years of service credit.
13.17(b) (c) Postretirement adjustments. After December 31, 2010, annuities and
13.18benefits from the MERF division are eligible for annual automatic postretirement
13.19adjustments solely under section356.415 .
13.20EFFECTIVE DATE.This section is effective the day following final enactment.
13.21 Sec. 10. Minnesota Statutes 2012, section 353.657, subdivision 2, is amended to read:
13.22 Subd. 2. Benefit amount. (a) The spouse of a deceased member is entitled to
13.23receive a monthly benefit for life equal to the following percentage of the member's
13.24averagefull-time monthly salary rate, as defined in section 353.01, subdivision 17a,
13.25paragraph (c), as a member of the police and fire planin effect over the last six months of
13.26allowable service preceding the month in which death occurred:
13.27 (1) if the death was a line of duty death, 60 percent of thestated average salary
13.28is payable; and
13.29 (2) if the death was not a line of duty death or if death occurred while receiving
13.30disability benefits that accrued before July 1, 2007, 50 percent of thestated average salary
13.31is payable.
13.32 (b)If the member was a part-time employee in the position for which the employee
13.33qualified for participation in the police and fire plan, the monthly survivor benefit is based
13.34on the salary rate in effect for that member's part-time service during the last six months
13.35of allowable service. If the member's status changed from full time to part time for due
14.1to health reasons during the lastyear 12 months of employment, notwithstanding the
14.2definition of average salary in section 353.01, subdivision 17a, paragraph (c), the average
14.3salary used to compute the monthly survivor benefitis must be based on the full-time
14.4salary rate of the position held as a member of the police and fire plan in effect over the
14.5last six months of allowable service preceding the month in which the death occurred.
14.6EFFECTIVE DATE.This section is effective the day following final enactment.
14.7 Sec. 11. Minnesota Statutes 2012, section 353.657, subdivision 2a, is amended to read:
14.8 Subd. 2a. Death while eligible survivor benefit. (a) If a member or former member
14.9who has attained the age of at least 50 years and either who is vested under section
14.10353.01, subdivision 47
, or who has credit for at least 30 years of allowable service,
14.11regardless of age attained, dies before the annuity or disability benefit becomes payable,
14.12notwithstanding any designation of beneficiary to the contrary, the surviving spouse may
14.13elect to receive a death while eligible survivor benefit.
14.14 (b) Notwithstanding the definition of surviving spouse in section353.01, subdivision
14.1520 , a former spouse of the member, if any, is entitled to a portion of the death while
14.16eligible survivor benefit if stipulated under the terms of a marriage dissolution decree
14.17filed with the association. If there is no surviving spouse or child or children, a former
14.18spouse may be entitled to a lump-sum refund payment under section353.32, subdivision
14.191 , if provided for in a marriage dissolution decree but not a death while eligible survivor
14.20benefit despite the terms of a marriage dissolution decree filed with the association.
14.21 (c) The benefit may be elected instead of a refund with interest under section353.32,
14.22subdivision 1 , or surviving spouse benefits otherwise payable under subdivisions 1 and
14.232. The benefit must be an annuity equal to the 100 percent joint and survivor annuity
14.24which the member could have qualified for on the date of death, computed as provided in
14.25sections 353.651,subdivisions 2 and subdivision 3, and
353.30, subdivision 3 .
14.26 (d) The surviving spouse may apply for the annuity at any time after the date
14.27on which the deceased employee would have attained the required age for retirement
14.28based on the employee's allowable service. Sections353.34, subdivision 3 , and
353.71,
14.29subdivision 2 , apply to a deferred annuity payable under this subdivision.
14.30 (e) No payment accrues beyond the end of the month in which entitlement to
14.31such annuity has terminated. An amount equal to the excess, if any, of the accumulated
14.32contributions which were credited to the account of the deceased employee over and
14.33above the total of the annuities paid and payable to the surviving spouse must be paid to
14.34the deceased member's last designated beneficiary or, if none, to the legal representative of
14.35the estate of such deceased member.
15.1 (f) Any member may request in writing, with the signed consent of the spouse, that
15.2this subdivision not apply and that payment be made only to the designated beneficiary, as
15.3otherwise provided by this chapter.
15.4 (g) For a member who is employed as a full-time firefighter by the Department of
15.5Military Affairs of the state of Minnesota, allowable service as a full-time state Military
15.6Affairs Department firefighter credited by the Minnesota State Retirement System may be
15.7used in meeting the minimum allowable service requirement of this subdivision.
15.8EFFECTIVE DATE.This section is effective the day following final enactment.
15.9 Sec. 12. Minnesota Statutes 2012, section 353.657, subdivision 3, is amended to read:
15.10 Subd. 3. Dependent children. (a) A dependent child, as defined in section353.01,
15.11subdivision 15 , is entitled to receive a monthly benefit equal to ten percent of the member's
15.12averagefull-time monthly salary rate, as defined in section 353.01, subdivision 17a,
15.13paragraph (c), as a member of the police and fire planin effect over the last six months of
15.14allowable service preceding the month in which death occurred.
15.15(b) If the member's status changed from full-time to part-time due to health reasons
15.16during the last 12 months of employment, notwithstanding the definition of average salary
15.17in section 353.01, subdivision 17a, paragraph (c), the average salary used to compute the
15.18monthly dependent child benefit must be based on the full-time salary rate of the position
15.19held as a member of the police and fire plan in effect over the last six months of allowable
15.20service preceding the month in which the death occurred.
15.21 (c) Payments for the benefit of a dependent child must be made to the surviving
15.22parent, or to the legal guardian of the child or to any adult person with whom the child
15.23may at the time be living, provided only that the parent or other person to whom any
15.24amount is to be paid advises the board in writing that the amount will be held or used in
15.25trust for the benefit of the child.
15.26EFFECTIVE DATE.This section is effective the day following final enactment.
15.27 Sec. 13. Minnesota Statutes 2012, section 353F.02, subdivision 4, is amended to read:
15.28 Subd. 4. Medical facility. "Medical facility" means:
15.29 (1) Bridges Medical Services;
15.30(2) Cedarview Care Center in Steele County;
15.31 (3) the City of Cannon Falls Hospital;
15.32 (4) the Chris Jenson Health and Rehabilitation Center in St. Louis County;
16.1(5) Cornerstone Nursing and Rehab Center in Clearwater CountyMemorial Hospital
16.2doing business as Clearwater Health Services in Bagley;
16.3 (6) the Dassel Lakeside Community Home;
16.4(7) the Douglas County Hospital, with respect to the Mental Health Unit;
16.5 (8) the Fair Oaks Lodge, Wadena;
16.6 (9) the Glencoe Area Health Center;
16.7 (10) Hutchinson Area Health Care;
16.8(11) Lake County Sunrise Home;
16.9(11) (12) the Lakefield Nursing Home;
16.10(12) (13) the Lakeview Nursing Home in Gaylord;
16.11(13) (14) the Luverne Public Hospital;
16.12(14) (15) the Oakland Park Nursing Home;
16.13(15) (16) the RenVilla Nursing Home;
16.14(16) (17) the Rice Memorial Hospital in Willmar, with respect to the Department
16.15of Radiology and the Department of Radiation/Oncology;
16.16(17) (18) the St. Peter Community Health Care Center;
16.17(18) (19) the Traverse Care Center in Traverse County;
16.18(19) (20) the Waconia-Ridgeview Medical Center;
16.19(20) (21) the Weiner Memorial Medical Center, Inc.;
16.20(21) (22) the Wheaton Community Hospital; and
16.21(22) (23) the Worthington Regional Hospital.
16.22 Sec. 14. Minnesota Statutes 2012, section 356.635, subdivision 1, is amended to read:
16.23 Subdivision 1. Retirement benefit commencement. (a) The retirement benefit of a
16.24member who has terminated employment must begin no later than the later of April 1 of
16.25the calendar year following the calendar year that the member attains the federal minimum
16.26distribution age under section 401(a)(9) of the Internal Revenue Code or April 1 of the
16.27calendar year following the calendar year in which the member terminated employment.
16.28(b) The consent requirements of section 411(a)(11) of the Internal Revenue Code
16.29do not apply to the extent that a distribution is required to satisfy the requirements of
16.30section 401(a)(9).
1.3coverage of student employees and extending duration of excluded work-study
1.4positions; revising military service credit purchase provision for consistency with
1.5federal code; clarifying average salary for benefit purposes; clarifying MERF
1.6division benefit eligibility; adding Lake County Sunrise Home to privatization
1.7chapter; making other administrative changes; amending Minnesota Statutes
1.82012, sections 353.01, subdivisions 2b, 16, 17a, 29; 353.27, subdivision 7;
1.9353.34, subdivisions 1, 2; 353.50, subdivisions 3, 6; 353.657, subdivisions 2, 2a,
1.103; 353F.02, subdivision 4; 356.635, subdivision 1.
1.11BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:
1.12 Section 1. Minnesota Statutes 2012, section 353.01, subdivision 2b, is amended to read:
1.13 Subd. 2b. Excluded employees. (a) The following public employees are not eligible
1.14to participate as members of the association with retirement coverage by the general
1.15employees retirement plan, the local government correctional employees retirement plan
1.16under chapter 353E, or the public employees police and fire retirement plan:
1.17 (1) persons whose salary from one governmental subdivision never exceeds $425 in
1.18a month;
1.19(2) public officers who are elected to a governing body, city mayors, or persons who
1.20are appointed to fill a vacancy in an elective office of a governing body, whose term of office
1.21commences on or after July 1, 2002, for the service to be rendered in that elective position;
1.22 (3) election officers or election judges;
1.23 (4) patient and inmate personnel who perform services for a governmental
1.24subdivision;
1.25 (5) except as otherwise specified in subdivision 12a, employees who are hired for
1.26a temporary position as defined under subdivision 12a, and employees who resign from
2.1a nontemporary position and accept a temporary position within 30 days in the same
2.2governmental subdivision;
2.3 (6) employees who are employed by reason of work emergency caused by fire,
2.4flood, storm, or similar disaster;
2.5 (7) employees who by virtue of their employment in one governmental subdivision
2.6are required by law to be a member of and to contribute to any of the plans or funds
2.7administered by the Minnesota State Retirement System, the Teachers Retirement
2.8Association, the Duluth Teachers Retirement Fund Association, the St. Paul Teachers
2.9Retirement Fund Association, or any police or firefighters relief association governed by
2.10section
2.11or any local police or firefighters consolidation account who have not elected the type of
2.12benefit coverage provided by the public employees police and fire fund under sections
2.14who have not elected public employees police and fire plan benefit coverage. This clause
2.15must not be construed to prevent a person from being a member of and contributing to
2.16the Public Employees Retirement Association and also belonging to and contributing to
2.17another public pension plan or fund for other service occurring during the same period
2.18of time. A person who meets the definition of "public employee" in subdivision 2 by
2.19virtue of other service occurring during the same period of time becomes a member of the
2.20association unless contributions are made to another public retirement fund on the salary
2.21based on the other service or to the Teachers Retirement Association by a teacher as
2.22defined in section
2.23 (8) persons who are members of a religious order and are excluded from coverage
2.24under the federal Old Age, Survivors, Disability, and Health Insurance Program for the
2.25performance of service as specified in United States Code, title 42, section 410(a)(8)(A),
2.26as amended through January 1, 1987, if no irrevocable election of coverage has been made
2.27under section 3121(r) of the Internal Revenue Code of 1954, as amended;
2.28 (9) employees of a governmental subdivision who have not reached the age of
2.2923 and are enrolled on a full-time basis to attend or are attending classes on a full-time
2.30basis at an accredited school, college, or university in an undergraduate, graduate, or
2.31professional-technical program, or a public or charter high school;
2.32 (10) resident physicians, medical interns, and pharmacist residents and pharmacist
2.33interns who are serving in a degree or residency program in public hospitals or clinics;
2.34 (11) students who are serving for up to five years in an internship or residency program
2.35sponsored by a governmental subdivision, including an accredited educational institution;
3.1 (12) persons who hold a part-time adult supplementary technical college license who
3.2render part-time teaching service in a technical college;
3.3 (13) except for employees of Hennepin County or Hennepin Healthcare System, Inc.,
3.4foreign citizens who are employed by a governmental subdivision under a work permit, or
3.5an H-1b visa initially issued or extended for a combined period less than three years of
3.6employment. Upon extension of the employment beyond the three-year period, the foreign
3.7citizens must be reported for membership beginning the first of the month thereafter
3.8provided the monthly earnings threshold as provided under subdivision 2a is met;
3.9 (14) public hospital employees who elected not to participate as members of the
3.10association before 1972 and who did not elect to participate from July 1, 1988, to October
3.111, 1988;
3.12 (15) except as provided in section
3.13defined in subdivision 35, but persons who serve as volunteer ambulance service personnel
3.14may still qualify as public employees under subdivision 2 and may be members of the
3.15Public Employees Retirement Association and participants in the general employees
3.16retirement plan or the public employees police and fire plan, whichever applies, on the
3.17basis of compensation received from public employment service other than service as
3.18volunteer ambulance service personnel;
3.19 (16) except as provided in section
3.20subdivision 36, engaging in activities undertaken as part of volunteer firefighter duties,
3.21but a person who is a volunteer firefighter may still qualify as a public employee under
3.22subdivision 2 and may be a member of the Public Employees Retirement Association and
3.23a participant in the general employees retirement plan or the public employees police
3.24and fire plan, whichever applies, on the basis of compensation received from public
3.25employment activities other than those as a volunteer firefighter;
3.26 (17) pipefitters and associated trades personnel employed by Independent School
3.27District No. 625, St. Paul, with coverage under a collective bargaining agreement by the
3.28pipefitters local 455 pension plan who were either first employed after May 1, 1997, or,
3.29if first employed before May 2, 1997, elected to be excluded under Laws 1997, chapter
3.30241, article 2, section 12;
3.31 (18) electrical workers, plumbers, carpenters, and associated trades personnel who
3.32are employed by Independent School District No. 625, St. Paul, or the city of St. Paul,
3.33who have retirement coverage under a collective bargaining agreement by the Electrical
3.34Workers Local 110 pension plan, the United Association Plumbers Local 34 pension plan,
3.35or the pension plan applicable to Carpenters Local 87 who were either first employed after
4.1May 1, 2000, or, if first employed before May 2, 2000, elected to be excluded under
4.2Laws 2000, chapter 461, article 7, section 5;
4.3 (19) bricklayers, allied craftworkers, cement masons, glaziers, glassworkers,
4.4painters, allied tradesworkers, and plasterers who are employed by the city of St. Paul
4.5or Independent School District No. 625, St. Paul, with coverage under a collective
4.6bargaining agreement by the Bricklayers and Allied Craftworkers Local 1 pension plan,
4.7the Cement Masons Local 633 pension plan, the Glaziers and Glassworkers Local L-1324
4.8pension plan, the Painters and Allied Trades Local 61 pension plan, or the Twin Cities
4.9Plasterers Local 265 pension plan who were either first employed after May 1, 2001, or if
4.10first employed before May 2, 2001, elected to be excluded under Laws 2001, First Special
4.11Session chapter 10, article 10, section 6;
4.12 (20) plumbers who are employed by the Metropolitan Airports Commission, with
4.13coverage under a collective bargaining agreement by the Plumbers Local 34 pension plan,
4.14who either were first employed after May 1, 2001, or if first employed before May 2,
4.152001, elected to be excluded under Laws 2001, First Special Session chapter 10, article
4.1610, section 6;
4.17 (21) employees who are hired after June 30, 2002, to fill seasonal positions under
4.18subdivision 12b which are limited in duration by the employer to 185 consecutive calendar
4.19days or less in each year of employment with the governmental subdivision;
4.20 (22) persons who are provided supported employment or work-study positions by a
4.21governmental subdivision and who participate in an employment or industries program
4.22maintained for the benefit of these persons where the governmental subdivision limits
4.23the position's duration up to
4.24federal or state subsidized on-the-job training, work experience, senior citizen, youth, or
4.25unemployment relief program where the training or work experience is not provided as a
4.26part of, or for, future permanent public employment;
4.27 (23) independent contractors and the employees of independent contractors;
4.28 (24) reemployed annuitants of the association during the course of that
4.29reemployment; and
4.30(25) persons appointed to serve on a board or commission of a governmental
4.31subdivision or an instrumentality thereof.
4.32(b) Any person performing the duties of a public officer in a position defined in
4.33subdivision 2a, paragraph (a), clause (3), is not an independent contractor and is not an
4.34employee of an independent contractor.
4.35EFFECTIVE DATE.This section is effective the day following final enactment.
5.1 Sec. 2. Minnesota Statutes 2012, section 353.01, subdivision 16, is amended to read:
5.2 Subd. 16. Allowable service; limits and computation. (a) "Allowable service"
5.3means:
5.4 (1) service during years of actual membership in the course of which employee
5.5deductions were withheld from salary and contributions were made at the applicable rates
5.6under section
5.7(2) periods of service covered by payments in lieu of salary deductions under
5.8sections
5.9 (3) service in years during which the public employee was not a member but for
5.10which the member later elected, while a member, to obtain credit by making payments to
5.11the fund as permitted by any law then in effect;
5.12 (4) a period of authorized leave of absence with pay from which deductions for
5.13employee contributions are made, deposited, and credited to the fund;
5.14 (5) a period of authorized personal, parental, or medical leave of absence without
5.15pay, including a leave of absence covered under the federal Family Medical Leave Act,
5.16that does not exceed one year, and for which a member obtained service credit for each
5.17month in the leave period by payment under section
5.18salary deductions. An employee must return to public service and render a minimum of
5.19three months of allowable service in order to be eligible to make payment under section
5.21employee must be granted allowable service credit for the purchased period;
5.22 (6) a periodic, repetitive leave that is offered to all employees of a governmental
5.23subdivision. The leave program may not exceed 208 hours per annual normal work cycle
5.24as certified to the association by the employer. A participating member obtains service
5.25credit by making employee contributions in an amount or amounts based on the member's
5.26average salary, excluding overtime pay, that would have been paid if the leave had not been
5.27taken. The employer shall pay the employer and additional employer contributions on
5.28behalf of the participating member. The employee and the employer are responsible to pay
5.29interest on their respective shares at the rate of 8.5 percent a year, compounded annually,
5.30from the end of the normal cycle until full payment is made. An employer shall also make
5.31the employer and additional employer contributions, plus 8.5 percent interest, compounded
5.32annually, on behalf of an employee who makes employee contributions but terminates
5.33public service. The employee contributions must be made within one year after the end of
5.34the annual normal working cycle or within 30 days after termination of public service,
5.35whichever is sooner. The executive director shall prescribe the manner and forms to be
6.1used by a governmental subdivision in administering a periodic, repetitive leave. Upon
6.2payment, the member must be granted allowable service credit for the purchased period;
6.3 (7) an authorized temporary or seasonal layoff under subdivision 12, limited to three
6.4months allowable service per authorized temporary or seasonal layoff in one calendar year.
6.5An employee who has received the maximum service credit allowed for an authorized
6.6temporary or seasonal layoff must return to public service and must obtain a minimum of
6.7three months of allowable service subsequent to the layoff in order to receive allowable
6.8service for a subsequent authorized temporary or seasonal layoff;
6.9 (8) a period during which a member is absent from employment by a governmental
6.10subdivision by reason of service in the uniformed services, as defined in United States
6.11Code, title 38, section 4303(13), if the member returns to public service with the same
6.12governmental subdivision upon discharge from service in the uniformed service within the
6.13time frames required under United States Code, title 38, section 4312(e), provided that
6.14the member did not separate from uniformed service with a dishonorable or bad conduct
6.15discharge or under other than honorable conditions. The service must be credited if the
6.16member pays into the fund equivalent employee contributions based upon the contribution
6.17rate or rates in effect at the time that the uniformed service was performed multiplied
6.18by the full and fractional years being purchased and applied to the annual salary rate.
6.19The annual salary rate is the average annual salary
6.20purchase period that the member would have received if the member had continued to
6.21be employed in covered employment rather than to provide uniformed service, or, if
6.22the determination of that rate is not reasonably certain, the annual salary rate is the
6.23member's average salary rate
6.24covered employment rendered immediately preceding the period of the uniformed service.
6.25Payment of the member equivalent contributions must be made during a period that begins
6.26with the date on which the individual returns to public employment and that is three times
6.27the length of the military leave period, or within five years of the date of discharge from
6.28the military service, whichever is less. If the determined payment period is less than
6.29one year, the contributions required under this clause to receive service credit may be
6.30made within one year of the discharge date. Payment may not be accepted following 30
6.31days after termination of public service under subdivision 11a. If the member equivalent
6.32contributions provided for in this clause are not paid in full, the member's allowable
6.33service credit must be prorated by multiplying the full and fractional number of years of
6.34uniformed service eligible for purchase by the ratio obtained by dividing the total member
6.35contributions received by the total member contributions otherwise required under this
6.36clause. The equivalent employer contribution, and, if applicable, the equivalent additional
7.1employer contribution must be paid by the governmental subdivision employing the
7.2member if the member makes the equivalent employee contributions. The employer
7.3payments must be made from funds available to the employing unit, using the employer
7.4and additional employer contribution rate or rates in effect at the time that the uniformed
7.5service was performed, applied to the same annual salary rate or rates used to compute the
7.6equivalent member contribution. The governmental subdivision involved may appropriate
7.7money for those payments. The amount of service credit obtainable under this section may
7.8not exceed five years unless a longer purchase period is required under United States Code,
7.9title 38, section 4312. The employing unit shall pay interest on all equivalent member and
7.10employer contribution amounts payable under this clause. Interest must be computed at a
7.11rate of 8.5 percent compounded annually from the end of each fiscal year of the leave or the
7.12break in service to the end of the month in which the payment is received. Upon payment,
7.13the employee must be granted allowable service credit for the purchased period; or
7.14(9) a period specified under section
7.15 (b) For calculating benefits under sections
7.16state officers and employees displaced by the Community Corrections Act, chapter 401,
7.17and transferred into county service under section
7.18combined years of allowable service as defined in paragraph (a), clauses (1) to (6), and
7.19section
7.20 (c) For a public employee who has prior service covered by a local police or
7.21firefighters relief association that has consolidated with the Public Employees Retirement
7.22Association under chapter 353A or to which section
7.23elected the type of benefit coverage provided by the public employees police and fire
7.24fund either under section
7.25subdivision 4
7.26firefighters relief association as of the effective date of the consolidation based on law
7.27and on bylaw provisions governing the relief association on the date of the initiation
7.28of the consolidation procedure.
7.29 (d) No member may receive more than 12 months of allowable service credit in a
7.30year either for vesting purposes or for benefit calculation purposes. For an active member
7.31who was an active member of the former Minneapolis Firefighters Relief Association
7.32on December 29, 2011, "allowable service" is the period of service credited by the
7.33Minneapolis Firefighters Relief Association as reflected in the transferred records of the
7.34association up to December 30, 2011, and the period of service credited under paragraph
7.35(a), clause (1), after December 30, 2011. For an active member who was an active member
7.36of the former Minneapolis Police Relief Association on December 29, 2011, "allowable
8.1service" is the period of service credited by the Minneapolis Police Relief Association as
8.2reflected in the transferred records of the association up to December 30, 2011, and the
8.3period of service credited under paragraph (a), clause (1), after December 30, 2011.
8.4 (e) MS 2002 [Expired]
8.5EFFECTIVE DATE.This section is effective the day following final enactment.
8.6 Sec. 3. Minnesota Statutes 2012, section 353.01, subdivision 17a, is amended to read:
8.7 Subd. 17a. Average salary. (a) "Average salary,"
8.8
8.9an amount equivalent to the average of the highest salary of the member, police officer,
8.10or firefighter, whichever applies, upon which employee contributions were paid for any
8.11five successive years of allowable service, based on dates of salary periods as listed on
8.12salary deduction reports. Average salary must be based upon all allowable service if
8.13this service is less than five years.
8.14(b) "Average salary" may not include any reduced salary paid during a period
8.15in which the employee is entitled to benefit payments from workers' compensation for
8.16temporary disability, unless the average salary is higher, including this period.
8.17(c) "Average salary," for purposes of calculating benefits for a surviving spouse or
8.18dependent children under section 353.657, subdivision 2 or 3, means the average of the
8.19full-time monthly base salary rate in effect during the last six months of allowable service.
8.20If the employment during the last six months of allowable service was part-time, the
8.21average salary must be prorated based on the actual number of hours worked.
8.22EFFECTIVE DATE.This section is effective the day following final enactment.
8.23 Sec. 4. Minnesota Statutes 2012, section 353.01, subdivision 29, is amended to read:
8.24 Subd. 29. Designated beneficiary. "Designated beneficiary" means the person
8.25 organization, trust, or estate designated by a member, former member,
8.26
8.27
8.28to act on behalf of the member or former member to receive a refund of the balance of
8.29the member's or former member's accumulated deductions after death. A beneficiary
8.30designation is valid if it is made in the form prescribed by the executive director and
8.31is received by the association on or before the date of death of the member or former
8.32member. If a beneficiary designation is deemed to be invalid for any reason, any remaining
9.1balance of the member's or former member's accumulated deductions are subject to the
9.2provisions of section 353.32, subdivisions 4 and 5.
9.3EFFECTIVE DATE.This section is effective the day following final enactment.
9.4 Sec. 5. Minnesota Statutes 2012, section 353.27, subdivision 7, is amended to read:
9.5 Subd. 7. Adjustment for erroneous receipts or disbursements. (a) Except
9.6as provided in paragraph (b), erroneous employee deductions and erroneous employer
9.7contributions and additional employer contributions to the general employees retirement
9.8plan of the Public Employees Retirement Association or to the public employees police
9.9and fire retirement plan for a person who otherwise does not qualify for membership
9.10under this chapter, are considered:
9.11(1) valid if the initial erroneous deduction began before January 1, 1990. Upon
9.12determination of the error by the association, the person may continue membership in the
9.13association while employed in the same position for which erroneous deductions were
9.14taken, or file a written election to terminate membership and apply for a refund upon
9.15termination of public service or defer an annuity under section
9.16(2) invalid, if the initial erroneous employee deduction began on or after January 1,
9.171990. Upon determination of the error, the association shall refund all erroneous employee
9.18deductions and all erroneous employer contributions as specified in paragraph (e). No
9.19person may claim a right to continued or past membership in the association based on
9.20erroneous deductions which began on or after January 1, 1990.
9.21(b) Erroneous deductions taken from the salary of a person who did not qualify
9.22for membership in the general employees retirement plan of the Public Employees
9.23Retirement Association or in the public employees police and fire retirement plan by
9.24virtue of concurrent employment before July 1, 1978, which required contributions to
9.25another retirement fund or relief association established for the benefit of officers and
9.26employees of a governmental subdivision, are invalid. Upon discovery of the error,
9.27allowable service credit for all invalid service if forfeited and, upon termination of public
9.28service, the association shall refund all erroneous employee deductions to the person, with
9.29interest as determined under section
9.30contributions without interest to the employer. This paragraph has both retroactive and
9.31prospective application.
9.32(c) Adjustments to correct employer contributions and employee deductions taken
9.33in error from amounts which are not salary under section
9.34be made as specified in paragraph (e). The period of adjustment must be limited to the
10.1fiscal year in which the error is discovered by the association and the immediate two
10.2preceding fiscal years.
10.3(d) If there is evidence of fraud or other misconduct on the part of the employee or
10.4the employer, the board of trustees may authorize adjustments to the account of a member
10.5or former member to correct erroneous employee deductions and employer contributions
10.6on invalid salary and the recovery of any overpayments for a period longer than provided
10.7for under paragraph (c).
10.8(e) Upon discovery of the receipt of erroneous employee deductions and employer
10.9contributions under paragraph (a), clause (2), or paragraph (c), the association must require
10.10the employer to discontinue the erroneous employee deductions and erroneous employer
10.11contributions reported on behalf of a member. Upon discontinuation, the association must:
10.12(1) for a member, provide a refund in the amount of the invalid employee deductions
10.13with interest on the invalid employee deductions at the rate specified under section
10.14subdivision 2
10.15the credit or refund is made;
10.16(2) for a former member who:
10.17(i) is not receiving a retirement annuity or benefit, return the erroneous employee
10.18deductions to the former member through a refund with interest at the rate specified under
10.19section
10.20through the date the credit or refund is made; or
10.21(ii) is receiving a retirement annuity or disability benefit, or a person who is
10.22receiving an optional annuity or survivor benefit, for whom it has been determined an
10.23overpayment must be recovered, adjust the payment amount and recover the overpayments
10.24as provided under this section; and
10.25(3) return the invalid employer contributions reported on behalf of a member or
10.26former member to the employer by providing a credit against future contributions payable
10.27by the employer.
10.28(f) In the event that a salary warrant or check from which a deduction for the
10.29retirement fund was taken has been canceled or the amount of the warrant or check
10.30returned to the funds of the department making the payment, a refund of the sum
10.31deducted, or any portion of it that is required to adjust the deductions, must be made
10.32to the department or institution.
10.33(g) If the
10.34benefit, or disability benefit
10.35
10.36salary, or due to any erroneous calculation procedure, the association must recalculate
11.1the annuity or benefit payable and
11.2benefit effective the first of the month following discovery of the error. Any overpayment
11.3resulting from the incorrect calculation must be recovered as provided under subdivision
11.47b, if the accrual date, or any adjustment in the amount of the annuity or benefit calculated
11.5after the accrual date, except adjustments required under section 353.656, subdivision 4,
11.6falls within the current fiscal year and the two immediate previous fiscal years.
11.7(h) Notwithstanding the provisions of this subdivision, the association may apply
11.8the Revenue Procedures defined in the federal Internal Revenue Service Employee Plans
11.9Compliance Resolution System and not issue a refund of erroneous employee deductions
11.10and employer contributions or not recover a small overpayment of benefits if the cost to
11.11correct the error would exceed the amount of the member refund or overpayment.
11.12(i) Any fees or penalties assessed by the federal Internal Revenue Service for any
11.13failure by an employer to follow the statutory requirements for reporting eligible members
11.14and salary must be paid by the employer.
11.15EFFECTIVE DATE.This section is effective the day following final enactment.
11.16 Sec. 6. Minnesota Statutes 2012, section 353.34, subdivision 1, is amended to read:
11.17 Subdivision 1. Refund or deferred annuity. (a) A former member is entitled to
11.18either a refund of accumulated employee deductions under subdivision 2, or to a deferred
11.19annuity under subdivision 3. Application for a refund may not be made before the date of
11.20termination of public service.
11.21within 120 days following receipt of the application unless the applicant has again become
11.22a public employee required to be covered by the association.
11.23(b) If an individual was placed on layoff under section
11.24a refund is not payable before termination of service under section
11.25(c) An individual who terminates public service covered by the Public Employees
11.26Retirement Association general employees retirement plan, the MERF division, the Public
11.27Employees Retirement Association police and fire retirement plan, or the public employees
11.28local government correctional service retirement plan, and who is employed by a different
11.29employer and who becomes an active member covered by one of the other two plans, may
11.30receive a refund of employee contributions plus annual compound interest from the plan
11.31from which the member terminated service at the applicable rate specified in subdivision 2.
11.32EFFECTIVE DATE.This section is effective the day following final enactment.
11.33 Sec. 7. Minnesota Statutes 2012, section 353.34, subdivision 2, is amended to read:
12.1 Subd. 2. Refund with interest. (a) Except as provided in subdivision 1, any person
12.2who ceases to be a public employee is entitled to receive a refund in an amount equal to
12.3accumulated deductions with annual compound interest to the first day of the month
12.4in which the refund is processed.
12.5(b) For a person who ceases to be a public employee before July 1, 2011, the refund
12.6interest is at the rate of six percent to June 30, 2011, and at the rate of four percent after
12.7June 30, 2011. For a person who ceases to be a public employee after July 1, 2011, the
12.8refund interest is at the rate of four percent.
12.9(c) If a person repays a refund and subsequently applies for another refund, the
12.10repayment amount, including interest, is added to the fiscal year balance in which the
12.11repayment was made.
12.12(d) If the refund payable to a member is based on employee deductions that are
12.13determined to be invalid under section 353.27, subdivision 7, the interest payable on the
12.14invalid employee deductions is four percent.
12.15EFFECTIVE DATE.This section is effective the day following final enactment.
12.16 Sec. 8. Minnesota Statutes 2012, section 353.50, subdivision 3, is amended to read:
12.17 Subd. 3. Service credit and benefit liability transfer. (a) All allowable service
12.18credit and salary credit of the members of the Minneapolis Employees Retirement Fund
12.19as specified in the records of the Minneapolis Employees Retirement Fund through June
12.2030, 2010, are transferred to the MERF division of the Public Employees Retirement
12.21Association and are credited by the MERF division.
12.22
12.23
12.24
12.25
12.26
12.27(b) The liability for the payment of annuities and benefits of the Minneapolis
12.28Employees Retirement Fund retirees and benefit recipients as specified in the records of
12.29the Minneapolis Employees Retirement Fund on June 29, 2010, is transferred to the
12.30MERF division of the Public Employees Retirement Association on June 30, 2010.
12.31EFFECTIVE DATE.This section is effective the day following final enactment.
12.32 Sec. 9. Minnesota Statutes 2012, section 353.50, subdivision 6, is amended to read:
13.1 Subd. 6. Benefits. (a) Retired, disabled, deferred, and inactive member benefits.
13.2The annuities and benefits of, or attributable to, retired, disabled, deferred, or inactive
13.3Minneapolis Employees Retirement Fund members with that status as of June 30, 2010,
13.4
13.5
13.8
13.9(b) Benefits; benefit eligibility for June 30, 2010, active members. Persons who
13.10were active members of the former Minneapolis Employees Retirement Fund on June
13.1130, 2010, upon satisfying eligibility requirements stated in the applicable sections of
13.12Minnesota Statutes 2008 specified in paragraph (a), are entitled to annuities or benefits
13.13specified in those sections. Eligibility for a formula retirement annuity includes the
13.14requirement in Minnesota Statutes 2008, sections 422A.13 and 422A.16, that the
13.15terminating member has attained retirement age, which is age 60 if the person has at least
13.16ten years of service credit, or any age if the person has 30 or more years of service credit.
13.17
13.18benefits from the MERF division are eligible for annual automatic postretirement
13.19adjustments solely under section
13.20EFFECTIVE DATE.This section is effective the day following final enactment.
13.21 Sec. 10. Minnesota Statutes 2012, section 353.657, subdivision 2, is amended to read:
13.22 Subd. 2. Benefit amount. (a) The spouse of a deceased member is entitled to
13.23receive a monthly benefit for life equal to the following percentage of the member's
13.24average
13.25paragraph (c), as a member of the police and fire plan
13.26
13.27 (1) if the death was a line of duty death, 60 percent of the
13.28is payable; and
13.29 (2) if the death was not a line of duty death or if death occurred while receiving
13.30disability benefits that accrued before July 1, 2007, 50 percent of the
13.31is payable.
13.32 (b)
13.33
13.34
13.35
14.1to health reasons during the last
14.2definition of average salary in section 353.01, subdivision 17a, paragraph (c), the average
14.3salary used to compute the monthly survivor benefit
14.4salary rate of the position held as a member of the police and fire plan in effect over the
14.5last six months of allowable service preceding the month in which the death occurred.
14.6EFFECTIVE DATE.This section is effective the day following final enactment.
14.7 Sec. 11. Minnesota Statutes 2012, section 353.657, subdivision 2a, is amended to read:
14.8 Subd. 2a. Death while eligible survivor benefit. (a) If a member or former member
14.9who has attained the age of at least 50 years and either who is vested under section
14.11regardless of age attained, dies before the annuity or disability benefit becomes payable,
14.12notwithstanding any designation of beneficiary to the contrary, the surviving spouse may
14.13elect to receive a death while eligible survivor benefit.
14.14 (b) Notwithstanding the definition of surviving spouse in section
14.1520
14.16eligible survivor benefit if stipulated under the terms of a marriage dissolution decree
14.17filed with the association. If there is no surviving spouse or child or children, a former
14.18spouse may be entitled to a lump-sum refund payment under section
14.191
14.20benefit despite the terms of a marriage dissolution decree filed with the association.
14.21 (c) The benefit may be elected instead of a refund with interest under section
14.22subdivision 1
14.232. The benefit must be an annuity equal to the 100 percent joint and survivor annuity
14.24which the member could have qualified for on the date of death, computed as provided in
14.25sections 353.651,
14.26 (d) The surviving spouse may apply for the annuity at any time after the date
14.27on which the deceased employee would have attained the required age for retirement
14.28based on the employee's allowable service. Sections
14.29subdivision 2
14.30 (e) No payment accrues beyond the end of the month in which entitlement to
14.31such annuity has terminated. An amount equal to the excess, if any, of the accumulated
14.32contributions which were credited to the account of the deceased employee over and
14.33above the total of the annuities paid and payable to the surviving spouse must be paid to
14.34the deceased member's last designated beneficiary or, if none, to the legal representative of
14.35the estate of such deceased member.
15.1 (f) Any member may request in writing, with the signed consent of the spouse, that
15.2this subdivision not apply and that payment be made only to the designated beneficiary, as
15.3otherwise provided by this chapter.
15.4 (g) For a member who is employed as a full-time firefighter by the Department of
15.5Military Affairs of the state of Minnesota, allowable service as a full-time state Military
15.6Affairs Department firefighter credited by the Minnesota State Retirement System may be
15.7used in meeting the minimum allowable service requirement of this subdivision.
15.8EFFECTIVE DATE.This section is effective the day following final enactment.
15.9 Sec. 12. Minnesota Statutes 2012, section 353.657, subdivision 3, is amended to read:
15.10 Subd. 3. Dependent children. (a) A dependent child, as defined in section
15.11subdivision 15
15.12average
15.13paragraph (c), as a member of the police and fire plan
15.14
15.15(b) If the member's status changed from full-time to part-time due to health reasons
15.16during the last 12 months of employment, notwithstanding the definition of average salary
15.17in section 353.01, subdivision 17a, paragraph (c), the average salary used to compute the
15.18monthly dependent child benefit must be based on the full-time salary rate of the position
15.19held as a member of the police and fire plan in effect over the last six months of allowable
15.20service preceding the month in which the death occurred.
15.21 (c) Payments for the benefit of a dependent child must be made to the surviving
15.22parent, or to the legal guardian of the child or to any adult person with whom the child
15.23may at the time be living, provided only that the parent or other person to whom any
15.24amount is to be paid advises the board in writing that the amount will be held or used in
15.25trust for the benefit of the child.
15.26EFFECTIVE DATE.This section is effective the day following final enactment.
15.27 Sec. 13. Minnesota Statutes 2012, section 353F.02, subdivision 4, is amended to read:
15.28 Subd. 4. Medical facility. "Medical facility" means:
15.29 (1) Bridges Medical Services;
15.30(2) Cedarview Care Center in Steele County;
15.31 (3) the City of Cannon Falls Hospital;
15.32 (4) the Chris Jenson Health and Rehabilitation Center in St. Louis County;
16.1(5) Cornerstone Nursing and Rehab Center in Clearwater County
16.2
16.3 (6) the Dassel Lakeside Community Home;
16.4(7) the Douglas County Hospital, with respect to the Mental Health Unit;
16.5 (8) the Fair Oaks Lodge, Wadena;
16.6 (9) the Glencoe Area Health Center;
16.7 (10) Hutchinson Area Health Care;
16.8(11) Lake County Sunrise Home;
16.9
16.10
16.11
16.12
16.13
16.14
16.15of Radiology and the Department of Radiation/Oncology;
16.16
16.17
16.18
16.19
16.20
16.21
16.22 Sec. 14. Minnesota Statutes 2012, section 356.635, subdivision 1, is amended to read:
16.23 Subdivision 1. Retirement benefit commencement. (a) The retirement benefit of a
16.24member who has terminated employment must begin no later than the later of April 1 of
16.25the calendar year following the calendar year that the member attains the federal minimum
16.26distribution age under section 401(a)(9) of the Internal Revenue Code or April 1 of the
16.27calendar year following the calendar year in which the member terminated employment.
16.28(b) The consent requirements of section 411(a)(11) of the Internal Revenue Code
16.29do not apply to the extent that a distribution is required to satisfy the requirements of
16.30section 401(a)(9).
