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HF 1139

as introduced - 85th Legislature (2007 - 2008) Posted on 12/15/2009 12:00am

KEY: stricken = removed, old language.
underscored = added, new language.
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A bill for an act
relating to retirement; Minnesota State Retirement System; making changes of
an administrative nature; amending Minnesota Statutes 2006, sections 3A.02,
subdivision 1; 352.01, subdivisions 2a, 2b, 11; 352.12, subdivision 2a; 352.27;
352.951; 352.98, by adding a subdivision; 352D.02, subdivisions 1, 3; 352D.06,
subdivision 3; 356.405; 490.121, subdivisions 15a, 21d, 21f; proposing coding
for new law in Minnesota Statutes, chapter 352.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

Section 1.

Minnesota Statutes 2006, section 3A.02, subdivision 1, is amended to read:


Subdivision 1.

Qualifications.

(a) A former legislator is entitled, upon written
application to the director, to receive a retirement allowance monthly, if the person:

(1) has either served at least six full years, without regard to the application of
section 3A.10, subdivision 2, or has served during all or part of four regular sessions as a
member of the legislature, which service need not be continuous;

(2) has attained the normal retirement age;

(3) has retired as a member of the legislature; and

(4) has made all contributions provided for in section 3A.03, has made payments
for past service under subdivision 2, or has made payments in lieu of contributions under
Minnesota Statutes 1992, section 3A.031, before July 1, 1994.

(b) Unless the former legislator has legislative service before January 1, 1979,
the retirement allowance is an amount equal to 2-1/2 percent per year of service of that
member's average monthly salary and adjusted for that person on an actuarial equivalent
basis to reflect the change in the postretirement interest rate actuarial assumption under
section 356.215, subdivision 8, from five percent to six percent. The adjustment must be
calculated by or, alternatively, the adjustment procedure must be specified by, the actuary
retained under section 356.214. The purpose of this adjustment is to ensure that the total
amount of benefits that the actuary predicts an individual member will receive over the
member's lifetime under this paragraph will be the same as the total amount of benefits the
actuary predicts the individual member would receive over the member's lifetime under
the law in effect before enactment of this paragraph. If the former legislator has legislative
service before January 1, 1979, the person's benefit must include the additional benefit
amount in effect on January 1, 1979, and adjusted as otherwise provided in this paragraph.

(c) The retirement allowance accrues deleted text begin beginning with the first day of the month of
receipt of the application,
deleted text end new text begin following receipt by the director of a retirement application on
a form prescribed by the director,
new text end but not before new text begin normal retirement new text end age deleted text begin 60, anddeleted text end new text begin , except
as specified in subdivision 1b. The annuity is payable
new text end for the remainder of the former
legislator's life, if the former legislator is not serving as a member of the legislature or as a
constitutional officer as defined in section 3A.01, subdivision 1c. The annuity does not
begin to accrue before the person's retirement as a legislator. No annuity payment may
be made retroactive for more than 180 days before the date that the annuity application
is filed with the director.

(d) Any member who has served during all or part of four regular sessions is
considered to have served eight years as a member of the legislature.

(e) The retirement allowance ceases with the last payment that accrued to the retired
legislator during the retired legislator's lifetime, except that the surviving spouse, if any,
is entitled to receive the retirement allowance of the retired legislator for the calendar
month in which the retired legislator died.

Sec. 2.

Minnesota Statutes 2006, section 352.01, subdivision 2a, is amended to read:


Subd. 2a.

Included employees.

(a) "State employee" includes:

(1) employees of the Minnesota Historical Society;

(2) employees of the State Horticultural Society;

deleted text begin (3) employees of the Disabled American Veterans, Department of Minnesota,
Veterans of Foreign Wars, Department of Minnesota, if employed before July 1, 1963;
deleted text end

deleted text begin (4)deleted text end new text begin (3) new text end employees of the Minnesota Crop Improvement Association;

deleted text begin (5)deleted text end new text begin (4) new text end employees of the adjutant general who are paid from federal funds and who
are not covered by any federal civilian employees retirement system;

deleted text begin (6)deleted text end new text begin (5) new text end employees of the Minnesota State Colleges and Universities employed under
the university or college activities program;

deleted text begin (7)deleted text end new text begin (6) new text end currently contributing employees covered by the system who are temporarily
employed by the legislature during a legislative session or any currently contributing
employee employed for any special service as defined in subdivision 2b, clause (8);

deleted text begin (8) employees of the Armory Building Commission;
deleted text end

deleted text begin (9)deleted text end new text begin (7) new text end employees of the legislature appointed without a limit on the duration of their
employment and persons employed or designated by the legislature or by a legislative
committee or commission or other competent authority to conduct a special inquiry,
investigation, examination, or installation;

deleted text begin (10)deleted text end new text begin (8) new text end trainees who are employed on a full-time established training program
performing the duties of the classified position for which they will be eligible to receive
immediate appointment at the completion of the training period;

deleted text begin (11)deleted text end new text begin (9) new text end employees of the Minnesota Safety Council;

deleted text begin (12)deleted text end new text begin (10) new text end any employees on authorized leave of absence from the Transit Operating
Division of the former Metropolitan Transit Commission who are employed by the
labor organization which is the exclusive bargaining agent representing employees of
the Transit Operating Division;

deleted text begin (13)deleted text end new text begin (11) new text end employees of the Metropolitan Council, Metropolitan Parks and Open
Space Commission, Metropolitan Sports Facilities Commission, Metropolitan Mosquito
Control Commission, or Metropolitan Radio Board unless excluded or covered by another
public pension fund or plan under section 473.415, subdivision 3;

deleted text begin (14)deleted text end new text begin (12) new text end judges of the Tax Court;

deleted text begin (15)deleted text end new text begin (13) new text end personnel employed on June 30, 1992, by the University of Minnesota
in the management, operation, or maintenance of its heating plant facilities, whose
employment transfers to an employer assuming operation of the heating plant facilities,
so long as the person is employed at the University of Minnesota heating plant by that
employer or by its successor organization;

deleted text begin (16)deleted text end new text begin (14) new text end seasonal help in the classified service employed by the Department of
Revenue; deleted text begin and
deleted text end

deleted text begin (17)deleted text end new text begin (15) new text end persons employed by the Department of Commerce as a peace officer in
the Insurance Fraud Prevention Division under section 45.0135 who have attained the
mandatory retirement age specified in section 43A.34, subdivision 4deleted text begin .deleted text end new text begin ; and
new text end

new text begin (16) employees of the University of Minnesota unless excluded under subdivision
2b, clause (3).
new text end

(b) Employees specified in paragraph (a), clause deleted text begin (15)deleted text end new text begin (13)new text end , are included employees
under paragraph (a) if employer and employee contributions are made in a timely manner
in the amounts required by section 352.04. Employee contributions must be deducted from
salary. Employer contributions are the sole obligation of the employer assuming operation
of the University of Minnesota heating plant facilities or any successor organizations to
that employer.

Sec. 3.

Minnesota Statutes 2006, section 352.01, subdivision 2b, is amended to read:


Subd. 2b.

Excluded employees.

"State employee" does not include:

(1) students employed by the University of Minnesota, or the state colleges and
universities, unless approved for coverage by the Board of Regents new text begin of the University of
Minnesota
new text end or the Board of Trustees of the Minnesota State Colleges and Universities, deleted text begin as
the case may be
deleted text end new text begin whichever is applicablenew text end ;

(2) employees who are eligible for membership in the state Teachers Retirement
Association, except employees of the Department of Education who have chosen or may
choose to be covered by the general state employees retirement plan of the Minnesota
State Retirement System instead of the Teachers Retirement Association;

(3) employees of the University of Minnesota who are excluded from coverage by
action of the Board of Regents;

(4) officers and enlisted personnel in the National Guard and the naval militia who
are assigned to permanent peacetime duty and who under federal law are or are required to
be members of a federal retirement system;

(5) election officers;

(6) persons who are engaged in public work for the state but who are employed
by contractors when the performance of the contract is authorized by the legislature or
other competent authority;

(7) officers and employees of the senate, or of the house of representatives, or of a
legislative committee or commission who are temporarily employed;

(8) receivers, jurors, notaries public, and court employees who are not in the judicial
branch as defined in section 43A.02, subdivision 25, except referees and adjusters
employed by the Department of Labor and Industry;

(9) patient and inmate help in state charitable, penal, and correctional institutions
including the Minnesota Veterans Home;

(10) persons who are employed for professional services where the service is
incidental to their regular professional duties and whose compensation is paid on a per
diem basis;

(11) employees of the Sibley House Association;

(12) the members of any state board or commission who serve the state intermittently
and are paid on a per diem basis; the secretary, secretary-treasurer, and treasurer of those
boards if their compensation is $5,000 or less per year, or, if they are legally prohibited
from serving more than three years; and the board of managers of the State Agricultural
Society and its treasurer unless the treasurer is also its full-time secretary;

(13) state troopersnew text begin and persons who are described in section 352B.01, subdivision 2,
clauses (2) to (6)
new text end ;

(14) temporary employees of the Minnesota State Fair who are employed on or
after July 1 for a period not to extend beyond October 15 of that year; and persons who
are employed at any time by the state fair administration for special events held on the
fairgrounds;

(15) emergency employees who are in the classified service; except that if an
emergency employee, within the same pay period, becomes a provisional or probationary
employee on other than a temporary basis, the employee shall be considered a "state
employee" retroactively to the beginning of the pay period;

deleted text begin (16) persons who are described in section deleted text begin 352B.01, subdivision 2deleted text end , clauses (2) to (6);
deleted text end

deleted text begin (17)deleted text end new text begin (16) new text end temporary employees in the classified service, and temporary employees
in the unclassified service who are appointed for a definite period of not more than six
months and who are employed less than six months in any one-year period;

deleted text begin (18)deleted text end new text begin (17) interns hired for six months or less and new text end trainee employees, except those
listed in subdivision 2a, clause deleted text begin (10)deleted text end new text begin (8)new text end ;

deleted text begin (19)deleted text end new text begin (18) new text end persons whose compensation is paid on a fee basisnew text begin or as an independent
contractor
new text end ;

deleted text begin (20)deleted text end new text begin (19) new text end state employees who are employed by the Board of Trustees of the
Minnesota State Colleges and Universities in unclassified positions enumerated in section
43A.08, subdivision 1, clause (9);

deleted text begin (21)deleted text end new text begin (20) new text end state employees who in any year have credit for 12 months service as
teachers in the public schools of the state and as teachers are members of the Teachers
Retirement Association or a retirement system in St. Paul, Minneapolis, or Duluthnew text begin ,
except for incidental employment as a state employee not covered by one of the teacher
retirement associations or systems
new text end ;

deleted text begin (22)deleted text end new text begin (21) new text end employees of the adjutant general who are employed on an unlimited
intermittent or temporary basis in the classified or unclassified service for the support of
Army and Air National Guard training facilities;

deleted text begin (23)deleted text end new text begin (22) new text end chaplains and nuns who are excluded from coverage under the federal
Old Age, Survivors, Disability, and Health Insurance Program for the performance of
service as specified in United States Code, title 42, section 410(a)(8)(A), as amended, if
no irrevocable election of coverage has been made under section 3121(r) of the Internal
Revenue Code of 1986, as amended through December 31, 1992;

deleted text begin (24)deleted text end new text begin (23) new text end examination monitors who are employed by departments, agencies,
commissions, and boards to conduct examinations required by law;

deleted text begin (25)deleted text end new text begin (24) new text end persons who are appointed to serve as members of fact-finding
commissions or adjustment panels, arbitrators, or labor referees under chapter 179;

deleted text begin (26)deleted text end new text begin (25) new text end temporary employees who are employed for limited periods under any state
or federal program for training or rehabilitation, including persons who are employed for
limited periods from areas of economic distress, but not including skilled and supervisory
personnel and persons having civil service status covered by the system;

deleted text begin (27)deleted text end new text begin (26) new text end full-time students who are employed by the Minnesota Historical Society
intermittently during part of the year and full-time during the summer months;

deleted text begin (28)deleted text end new text begin (27) new text end temporary employees who are appointed for not more than six months,
of the Metropolitan Council and of any of its statutory boards, if the board members are
appointed by the Metropolitan Council;

deleted text begin (29)deleted text end new text begin (28) new text end persons who are employed in positions designated by the Department of
Employee Relations as student workers;

deleted text begin (30)deleted text end new text begin (29) new text end members of trades who are employed by the successor to the Metropolitan
Waste Control Commission, who have trade union pension plan coverage under a
collective bargaining agreement, and who are first employed after June 1, 1977;

deleted text begin (31) persons who are employed in subsidized on-the-job training, work experience,
or public service employment as enrollees under the federal Comprehensive Employment
and Training Act after March 30, 1978, unless the person has as of the later of March 30,
1978, or the date of employment sufficient service credit in the retirement system to meet
the minimum vesting requirements for a deferred annuity, or the employer agrees in
writing on forms prescribed by the director to make the required employer contributions,
including any employer additional contributions, on account of that person from revenue
sources other than funds provided under the federal Comprehensive Employment and
Training Act, or the person agrees in writing on forms prescribed by the director to make
the required employer contribution in addition to the required employee contribution;
deleted text end

deleted text begin (32)deleted text end new text begin (30) new text end off-duty peace officers while employed by the Metropolitan Council;

deleted text begin (33)deleted text end new text begin (31) new text end persons who are employed as full-time police officers by the Metropolitan
Council and as police officers are members of the public employees police and fire fund;

deleted text begin (34)deleted text end new text begin (32) new text end persons who are employed as full-time firefighters by the Department
of Military Affairs and as firefighters are members of the public employees police and
fire fund;

deleted text begin (35)deleted text end new text begin (33) new text end foreign citizens with a work permit of less than three years, or an H-1b/JV
visa valid for less than three years of employment, unless notice of extension is supplied
which allows them to work for three or more years as of the date the extension is granted,
in which case they are eligible for coverage from the date extended; and

deleted text begin (36)deleted text end new text begin (34) new text end persons who are employed by the Board of Trustees of the Minnesota State
Colleges and Universities and who elect to remain members of the Public Employees
Retirement Association or the Minneapolis Employees Retirement Fund, whichever
applies, under section 136C.75.

Sec. 4.

Minnesota Statutes 2006, section 352.01, subdivision 11, is amended to read:


Subd. 11.

Allowable service.

new text begin (a) new text end "Allowable service" means:

deleted text begin (1) Service by an employee for which on or before July 1, 1957, the employee was
entitled to allowable service credit on the records of the system by reason of employee
contributions in the form of salary deductions, payments in lieu of salary deductions, or in
any other manner authorized by Minnesota Statutes 1953, chapter 352, as amended by
Laws 1955, chapter 239.
deleted text end

deleted text begin (2)deleted text end new text begin (1) new text end service by an employee for which on or before July 1, 1961, the employee
chose to obtain credit for service by making payments to the fund under Minnesota
Statutes 1961, section 352.24deleted text begin .deleted text end new text begin ;new text end

deleted text begin (3) Except as provided in clauses (8) and (9),deleted text end new text begin (2) new text end service by an employee after July 1,
1957, for any calendar month in which the employee is paid salary from which deductions
are made, deposited, and credited in the fund, including deductions made, deposited, and
credited as provided in section 352.041deleted text begin .deleted text end new text begin ;new text end

deleted text begin (4) Except as provided in clauses (8) and (9),deleted text end new text begin (3) new text end service by an employee deleted text begin after July
1, 1957,
deleted text end for any calendar month for which payments in lieu of salary deductions are
made, deposited, and credited in the fund, as provided in section 352.27 deleted text begin and Minnesota
Statutes 1957, section 352.021, subdivision 4.
deleted text end new text begin ;new text end

deleted text begin For purposes of clauses (3) and (4), except as provided in clauses (8) and (9), any
salary paid for a fractional part of any calendar month, including the month of separation
from state service, is deemed the compensation for the entire calendar month.
deleted text end

deleted text begin (5)deleted text end new text begin (4) new text end the period of absence from their duties by employees who are temporarily
disabled because of injuries incurred in the performance of duties and for which disability
the state is liable under the workers' compensation law until the date authorized by the
director for the commencement of payments of a total and permanent disability benefit
from the retirement funddeleted text begin .deleted text end new text begin ;
new text end

deleted text begin (6)deleted text end new text begin (5) new text end service covered by a refund repaid as provided in section 352.23 or 352D.05,
subdivision 4
, except service rendered as an employee of the adjutant general for which
the person has credit with the federal civil service retirement systemdeleted text begin .deleted text end new text begin ;new text end

deleted text begin (7)deleted text end new text begin (6) new text end service before July 1, 1978, by an employee of the Transit Operating Division
of the Metropolitan Transit Commission or by an employee on an authorized leave of
absence from the Transit Operating Division of the Metropolitan Transit Commission who
is employed by the labor organization which is the exclusive bargaining agent representing
employees of the Transit Operating Division, which was credited by the Metropolitan
Transit Commission-Transit Operating Division employees retirement fund or any of its
predecessor plans or funds as past, intermediate, future, continuous, or allowable service
as defined in the Metropolitan Transit Commission-Transit Operating Division employees
retirement fund plan document in effect on December 31, 1977deleted text begin .deleted text end new text begin ;
new text end

deleted text begin (8)deleted text end new text begin (7) new text end service after July 1, 1983, by an employee who is employed on a part-time
basis for less than 50 percent of full time, for which the employee is paid salary from
which deductions are made, deposited, and credited in the fund, including deductions
made, deposited, and credited as provided in section 352.041 or for which payments in
lieu of salary deductions are made, deposited, and credited in the fund as provided in
section 352.27 shall be credited on a fractional basis either by pay period, monthly, or
annually based on the relationship that the percentage of salary earned bears to a full-time
salary, with any salary paid for the fractional service credited on the basis of the rate of
salary applicable for a full-time pay period, month, or a full-time year. For periods of
part-time service that is duplicated service credit, section 356.30, subdivision 1, clauses
(i) and (j), governdeleted text begin .deleted text end new text begin ; andnew text end

deleted text begin Allowable service determined and credited on a fractional basis shall be used in
calculating the amount of benefits payable, but service as determined on a fractional basis
must not be used in determining the length of service required for eligibility for benefits.
deleted text end

deleted text begin (9)deleted text end new text begin (8) new text end any period of authorized leave of absence without pay that does not
exceed one year and for which the employee obtained credit by payment to the fund
deleted text begin in lieu of salary deductions. To obtain credit, the employee shall pay an amount equal
to the employee and employer contribution rate in section 352.04, subdivisions 2 and 3,
multiplied by the employee's hourly rate of salary on the date of return from leave of
absence and by the days and months of the leave of absence without pay for which the
employee wants allowable service credit. The employing department, at its option, may
pay the employer amount on behalf of its employees. Payments made under this clause
must include interest at an annual rate of 8.5 percent compounded annually from the date
of termination of the leave of absence to the date payment is made unless payment is
completed within one year of the return from leave of absence
deleted text end new text begin under section 352.017new text end .

deleted text begin (10)deleted text end new text begin (9) new text end MS 2002 [Expired]

deleted text begin (11)deleted text end new text begin (10) new text end [Expired, 2002 c 392 art 2 s 4]

new text begin (b) For purposes of paragraph (a), clauses (2) and (3), any salary paid for a fractional
part of any calendar month, including the month of separation from state service, is
deemed the compensation for the entire calendar month.
new text end

new text begin (c) Allowable service determined and credited on a fractional basis shall be used in
calculating the amount of benefits payable, but service as determined on a fractional basis
must not be used in determining the length of service required for eligibility for benefits.
new text end

Sec. 5.

new text begin [352.017] AUTHORIZED LEAVE OF ABSENCE SERVICE CREDIT
PURCHASE PROCEDURE.
new text end

new text begin Subdivision 1. new text end

new text begin Application. new text end

new text begin Except for leaves or breaks in service covered by
section 352.27 or 352.275, this section applies to all plans specified in this chapter for
any period of authorized leave of absence without pay that does not exceed one year
and for which the employee obtains credit for allowable service by making payment as
specified in this section to the applicable fund.
new text end

new text begin Subd. 2. new text end

new text begin Purchase procedure. new text end

new text begin (a) An employee covered by a plan specified in
this chapter may purchase credit for allowable service in that plan for a period specified
in subdivision 1 if the employee makes a payment as specified in paragraph (b) or (c),
whichever applies. The employing unit, at its option, may pay the employer portion of the
amount specified in paragraph (b) on behalf of its employees.
new text end

new text begin (b) If payment is received by the executive director within one year from the end
of the authorized leave, the payment amount is equal to the employee and employer
contribution rates specified in law for the applicable plan at the end of the leave period
multiplied by the employee's hourly rate of salary on the date of return from the leave of
absence and by the days and months of the leave of absence for which the employee wants
allowable service credit. Payments made under this paragraph must include compound
interest at a monthly rate of 0.71 percent from the last day of the leave period until the last
day of the month in which payment is received.
new text end

new text begin (c) If payment is received by the executive director after one year, the payment
amount is the amount determined under section 356.551.
new text end

Sec. 6.

Minnesota Statutes 2006, section 352.12, subdivision 2a, is amended to read:


Subd. 2a.

Surviving spouse coverage term certain.

new text begin (a) new text end In lieu of the 100 percent
optional annuity under subdivision 2, or refund under subdivision 1, the surviving spouse
of a deceased employee or former employee may elect to receive survivor coverage in
a term certain of deleted text begin five,deleted text end ten, 15, or 20 years, deleted text begin but monthly payments must not exceed 75
percent of the average high-five monthly salary of the deceased employee or former
employee
deleted text end . The monthly term certain annuity must be actuarially equivalent to the 100
percent optional annuity under subdivision 2.

new text begin (b) new text end If a survivor elects a term certain annuity and dies before the expiration of the
specified term certain period, the commuted value of the remaining annuity payments
must be paid in a lump sum to the survivor's estate.

Sec. 7.

Minnesota Statutes 2006, section 352.27, is amended to read:


352.27 CREDIT FOR BREAK IN SERVICE TO PROVIDE UNIFORMED
SERVICE.

(a) An employee who is absent from employment by reason of service in the
uniformed services, as defined in United States Code, title 38, section 4303(13), and who
returns to state service upon discharge from service in the uniformed service within the
time frames required in United States Code, title 38, section 4312(e), may obtain service
credit for the period of the uniformed service as further specified in this section, provided
that the employee did not separate from uniformed service with a dishonorable or bad
conduct discharge or under other than honorable conditions.

(b) The employee may obtain credit by paying into the fund an equivalent employee
contribution based upon the contribution rate or rates in effect at the time that the
uniformed service was performed multiplied by the full and fractional years being
purchased and applied to the annual salary rate. The annual salary rate is the average
annual salary during the purchase period that the employee would have received if the
employee had continued to be employed in covered employment rather than to provide
uniformed service, or, if the determination of that rate is not reasonably certain, the annual
salary rate is the employee's average salary rate during the 12-month period of covered
employment rendered immediately preceding the period of the uniformed service.

(c) The equivalent employer contribution and, if applicable, the equivalent
additional employer contribution provided in deleted text begin section 352.04deleted text end new text begin chapter 352 new text end must be paid by
the department employing the employee from funds available to the department at the
time and in the manner provided in deleted text begin section 352.04deleted text end new text begin chapter 352new text end , using the employer and
additional employer contribution rate or rates in effect at the time that the uniformed
service was performed, applied to the same annual salary rate or rates used to compute the
equivalent employee contribution.

(d) If the employee equivalent contributions provided in this section are not paid in
full, the employee's allowable service credit must be prorated by multiplying the full and
fractional number of years of uniformed service eligible for purchase by the ratio obtained
by dividing the total employee contribution received by the total employee contribution
otherwise required under this section.

(e) To receive service credit under this section, the contributions specified in this
section must be transmitted to the Minnesota State Retirement System during the period
which begins with the date on which the individual returns to state service and which has a
duration of three times the length of the uniformed service period, but not to exceed five
years. If the determined payment period is less than one year, the contributions required
under this section to receive service credit may be made within one year of the discharge
date.

(f) The amount of service credit obtainable under this section may not exceed five
years unless a longer purchase period is required under United States Code, title 38,
section 4312.

(g) The employing unit shall pay interest on all equivalent employee and employer
contribution amounts payable under this section. Interest must be computed at a rate of
8.5 percent compounded annually from the end of each fiscal year of the leave or the break
in service to the end of the month in which the payment is received.

Sec. 8.

Minnesota Statutes 2006, section 352.951, is amended to read:


352.951 APPLICABILITY OF GENERAL LAW.

Except as otherwise provided, this chapter applies to covered correctional
employees, military affairs personnel covered under section 352.85, deleted text begin anddeleted text end Transportation
Department pilots covered under section 352.86new text begin , and state fire marshal employees under
section 352.87
new text end .

Sec. 9.

Minnesota Statutes 2006, section 352.98, is amended by adding a subdivision
to read:


new text begin Subd. 8. new text end

new text begin Exemption from process. new text end

new text begin Assets in a health care savings plan account
described in this section must be used for reimbursement of healthcare expenses and
are not assignable or subject to execution, levy, attachment, garnishment, or other legal
process, except as provided in section 518.58, 518.581, or 518A.53.
new text end

Sec. 10.

Minnesota Statutes 2006, section 352D.02, subdivision 1, is amended to read:


Subdivision 1.

Coverage.

(a) Employees enumerated in paragraph (c), clauses (2),
(3), (4), deleted text begin anddeleted text end (6) to (14), new text begin and (16) to (18), new text end if they are in the unclassified service of the state
or Metropolitan Council and are eligible for coverage under the general state employees
retirement plan under chapter 352, are participants in the unclassified deleted text begin plandeleted text end new text begin program new text end under
this chapter unless the employee gives notice to the executive director of the Minnesota
State Retirement System within one year following the commencement of employment
in the unclassified service that the employee desires coverage under the general state
employees retirement plan. For the purposes of this chapter, an employee who does not
file notice with the executive director is deemed to have exercised the option to participate
in the unclassified deleted text begin plandeleted text end new text begin programnew text end .

(b) Persons referenced in paragraph (c), clause (5), are participants in the unclassified
program under this chapter unless the person was eligible to elect different coverage under
section 3A.07 and elected retirement coverage by the applicable alternative retirement
plan. Persons referenced in paragraph (c), clause (15), are participants in the unclassified
program under this chapter for judicial employment in excess of the service credit limit in
section 490.121, subdivision 22.

(c) Enumerated employees and referenced persons are:

(1) the governor, the lieutenant governor, the secretary of state, the state auditor,
and the attorney general;

(2) an employee in the Office of the Governor, Lieutenant Governor, Secretary
of State, State Auditor, Attorney General;

(3) an employee of the State Board of Investment;

(4) the head of a department, division, or agency created by statute in the unclassified
service, an acting department head subsequently appointed to the position, or an employee
enumerated in section 15A.0815 or 15A.083, subdivision 4;

(5) a member of the legislature;

(6) a full-time unclassified employee of the legislature or a commission or agency of
the legislature who is appointed without a limit on the duration of the employment or a
temporary legislative employee having shares in the supplemental retirement fund as a
result of former employment covered by this chapter, whether or not eligible for coverage
under the Minnesota State Retirement System;

(7) a person who is employed in a position established under section 43A.08,
subdivision 1
, clause (3), or in a position authorized under a statute creating or establishing
a department or agency of the state, which is at the deputy or assistant head of department
or agency or director level;

(8) the regional administrator, or executive director of the Metropolitan Council,
general counsel, division directors, operations managers, and other positions as designated
by the council, all of which may not exceed 27 positions at the council and the chair;

(9) the executive director, associate executive director, and not to exceed nine
positions of the Minnesota Office of Higher Education in the unclassified service, as
designated by the Minnesota Office of Higher Education before January 1, 1992, or
subsequently redesignated with the approval of the board of directors of the Minnesota
State Retirement System, unless the person has elected coverage by the individual
retirement account plan under chapter 354B;

(10) the clerk of the appellate courts appointed under article VI, section 2, of the
Constitution of the state of Minnesota;

(11) the chief executive officers of correctional facilities operated by the Department
of Corrections and of hospitals and nursing homes operated by the Department of Human
Services;

(12) an employee whose principal employment is at the state ceremonial house;

(13) an employee of the deleted text begin Minnesota Educational Computing Corporationdeleted text end new text begin Agricultural
Utilization Research Institute
new text end ;

(14) an employee of the State Lottery who is covered by the managerial plan
established under section 43A.18, subdivision 3; deleted text begin and
deleted text end

(15) a judge who has exceeded the service credit limit in section 490.121,
subdivision 22
deleted text begin .deleted text end new text begin ;
new text end

new text begin (16) an employee of Minnesota Technology Incorporated;
new text end

new text begin (17) a person employed by the Minnesota State Colleges and Universities as faculty
or in an eligible unclassified administrative position as defined in section 354B.20,
subdivision 6, who was employed by the former state university or the former community
college system prior to May 1, 1995, and elected unclassified program coverage prior to
May 1, 1995; and
new text end

new text begin (18) a person employed by the Minnesota State Colleges and Universities who was
employed in state service prior to July 1, 1995, who subsequently is employed in an
eligible unclassified administrative position as defined in section 354B.20, subdivision
6, and who elects coverage by the unclassified program.
new text end

Sec. 11.

Minnesota Statutes 2006, section 352D.02, subdivision 3, is amended to read:


Subd. 3.

deleted text begin Election irrevocabledeleted text end new text begin Transfer to general plannew text end .

deleted text begin An election to not
participate is irrevocable during any period of covered employment.
deleted text end new text begin (a) new text end An employee
credited with employee shares in the unclassified program, after acquiring credit for ten
years of allowable service deleted text begin but prior todeleted text end new text begin and not later than one month following new text end termination
of covered employment, maydeleted text begin , notwithstanding other provisions of this subdivision,deleted text end elect
to terminate participation in the unclassified deleted text begin plandeleted text end new text begin program new text end and be covered by the deleted text begin regulardeleted text end
new text begin general new text end plan by filing deleted text begin suchdeleted text end new text begin a written new text end election with the executive director. The executive
director shall deleted text begin thereupondeleted text end new text begin then new text end redeem the employee's total shares and shall credit to the
employee's account in the deleted text begin regulardeleted text end new text begin general new text end plan the amount of contributions that would
have been so credited had the employee been covered by the deleted text begin regulardeleted text end new text begin general new text end plan during
the employee's entire covered employment. The balance of money so redeemed and not
credited to the employee's account shall be transferred to the deleted text begin state contribution reserve of
the state employees
deleted text end new text begin general plan new text end retirement fund, except that (1) the employee contribution
paid to the unclassified deleted text begin plandeleted text end new text begin program new text end must be compared to (2) the employee contributions
that would have been paid to the general plan for the comparable period, if the individual
had been covered by that plan. If clause (1) is greater than clause (2), the difference must
be refunded to the employee as provided in section 352.22. If clause (2) is greater than
clause (1), the difference must be paid by the employee within six months of electing
general plan coverage or before the effective date of the annuity, whichever is sooner.

new text begin (b) An election under paragraph (a) to transfer coverage to the general plan is
irrevocable during any period of covered employment.
new text end

Sec. 12.

Minnesota Statutes 2006, section 352D.06, subdivision 3, is amended to read:


Subd. 3.

Accrual date.

An annuity under this section accrues the first day of the first
full month after an application is received or deleted text begin afterdeleted text end new text begin the day following new text end termination of state
service, whichever is later. deleted text begin Upon the former employee's request, the annuity may begin
to accrue up to six months before redemption of shares, but not prior to the termination
date from covered service, and must be based on the account value at redemption and
upon the age of the former employee at the date annuity accrual starts.
deleted text end The account must
be valued and redeemed on the later of the end of the month of termination of covered
employment, or the end of the month of receipt of the annuity application for the purpose
of computing the annuity.

Sec. 13.

Minnesota Statutes 2006, section 356.405, is amended to read:


356.405 COMBINED PAYMENT OF RETIREMENT ANNUITIES.

(a) The Public Employees Retirement Association and the Minnesota State
Retirement System are permitted to combine payments to retireesnew text begin if one of the payments
is less than $250 per month and the same joint and survivor annuity was taken, or if
the individual elects straight life annuities from both systems
new text end . The total payment must
be equal to the amount that is payable if payments were kept separate. deleted text begin The retiree must
agree, in writing, to have the payment combined.
deleted text end

(b) Each plan must calculate the benefit amounts under the laws governing the plan
and the required reserves deleted text begin and future mortality losses or gainsdeleted text end must be paid deleted text begin or accrueddeleted text end to
the plan new text begin making the combined payment new text end from deleted text begin whichdeleted text end the new text begin plan where the new text end service was earned.
deleted text begin Each plan must account for its portion of the payment separately, and there may be no
additional actuarial liabilities realized by either plan.
deleted text end

(c) The plan making the payment would be responsible for issuing one payment and
making address changes, tax withholding changes, and other administrative functions
needed to process the payment.

Sec. 14.

Minnesota Statutes 2006, section 490.121, subdivision 15a, is amended to
read:


Subd. 15a.

Early retirement date.

"Early retirement date" means deleted text begin the last day of
the month
deleted text end new text begin any date new text end after a judge attains the age of 60 but before the judge reaches the
normal retirement date.

Sec. 15.

Minnesota Statutes 2006, section 490.121, subdivision 21d, is amended to
read:


Subd. 21d.

Mandatory retirement date.

"Mandatory retirement date" means the
deleted text begin last day of the month in whichdeleted text end new text begin date new text end a judge has attained 70 years of age.

Sec. 16.

Minnesota Statutes 2006, section 490.121, subdivision 21f, is amended to read:


Subd. 21f.

Normal retirement date.

"Normal retirement date" means the deleted text begin last day
of the month in which
deleted text end new text begin date new text end a judge attains the age of 65.

Sec. 17. new text begin REVISOR INSTRUCTION.
new text end

new text begin The revisor of statutes shall replace references to section 356.55, which was repealed
in 2002, with references to section 356.551, wherever they appear in Minnesota Statutes
or Minnesota Rules. The revisor shall also make related grammatical changes.
new text end

Sec. 18. new text begin EFFECTIVE DATE.
new text end

new text begin (a) Sections 1 to 17 are effective the day following final enactment.
new text end

new text begin (b) The revisions to authorized leave purchase authority in sections 4 and 5 apply to
authorized leaves of absence that commence on or after the effective date.
new text end