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SF 427

1st Unofficial Engrossment - 84th Legislature (2005 - 2006) Posted on 12/15/2009 12:00am

KEY: stricken = removed, old language.
underscored = added, new language.
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  1.1                          A bill for an act 
  1.2             relating to retirement; various public pension plans; 
  1.3             clarifying and revising various plan provisions; 
  1.4             eliminating obsolete provisions; defining final 
  1.5             average salary; modifying the definition of allowable 
  1.6             service to include time on strike; permitting judges 
  1.7             to purchase service credit for an authorized leave; 
  1.8             requiring specified payments; clarifying references to 
  1.9             actuarial services in determining actuarial 
  1.10            equivalence; defining covered salary to include 
  1.11            certain employer contributions to supplemental 
  1.12            retirement plans; specifying itemized detail of plan 
  1.13            administrative expenses in annual financial reporting; 
  1.14            excluding police officers of the University of 
  1.15            Minnesota from the public employees police and fire 
  1.16            fund; clarifying collection procedures relating to 
  1.17            charter schools; adding a uniform nonassignment and 
  1.18            legal process exemption provision; adding employees of 
  1.19            Bridges Medical Services, Hutchinson Area Health Care, 
  1.20            and Northfield Hospital to privatization coverage; 
  1.21            extending date for filing special law approval with 
  1.22            the secretary of state for the RenVilla Nursing Home; 
  1.23            requiring the privatization periodic filing of updated 
  1.24            copies of articles of incorporation and bylaws; 
  1.25            modifying a higher education individual retirement 
  1.26            account plan investment option provision; implementing 
  1.27            the recommendations of the Volunteer Firefighter 
  1.28            Relief Association working group of the state auditor; 
  1.29            modifying the trigger date for filing financial 
  1.30            reports; revising the per firefighter financing 
  1.31            requirements for monthly benefit service pensions; 
  1.32            modifying the options for crediting interest on 
  1.33            deferred service pensions; clarifying the deferred 
  1.34            service pension options available to defined 
  1.35            contribution plans; providing for the crediting of 
  1.36            service during military service leaves; requiring the 
  1.37            amortization of experience losses; clarifying the 
  1.38            compliance requirements for the qualification for fire 
  1.39            state aid; modifying a limit on mutual fund 
  1.40            investments; clarifying corporate stock and exchange 
  1.41            traded funds investment authority; modifying the 
  1.42            municipal representation requirements on relief 
  1.43            association governing boards; clarifying exemptions 
  1.44            from process and taxation; providing that certain laws 
  1.45            do not apply to the consolidation of specified 
  1.46            volunteer firefighter relief associations; providing 
  2.1             an ad hoc postretirement adjustment to Eveleth police 
  2.2             and fire trust fund benefit recipients; authorizing 
  2.3             the Maplewood Firefighters Relief Association to 
  2.4             transfer assets to the Oakdale Firefighters Relief 
  2.5             Association to cover service credits earned by certain 
  2.6             individuals; appropriating money; amending Minnesota 
  2.7             Statutes 2004, sections 3A.01, subdivisions 1, 2, 6, 
  2.8             8, by adding subdivisions; 3A.011; 3A.02, subdivisions 
  2.9             1, 1b, 3, 4, 5; 3A.03, subdivisions 1, 2; 3A.04, 
  2.10            subdivisions 1, 2, 3, 4, by adding a subdivision; 
  2.11            3A.05; 3A.07; 3A.10, subdivision 1; 3A.12; 3A.13; 
  2.12            43A.17, subdivision 9; 69.011, subdivision 2b, by 
  2.13            adding a subdivision; 69.021, subdivisions 5, 11; 
  2.14            69.051, subdivisions 1, 1a; 69.33; 69.77, subdivision 
  2.15            4; 69.771; 69.772, subdivisions 3, 4; 69.773, 
  2.16            subdivisions 4, 5; 69.775; 352.01, subdivisions 2a, 4, 
  2.17            5, 12, 21, 23, by adding a subdivision; 352.021, 
  2.18            subdivisions 1, 2, 3, 4; 352.04, subdivisions 1, 12; 
  2.19            352.041, subdivisions 1, 2, 3, 5; 352.115, 
  2.20            subdivisions 2, 3; 352.15, subdivisions 1, 3, 4; 
  2.21            352.22, subdivision 10; 352.87, subdivision 3; 352.91, 
  2.22            by adding a subdivision; 352.93, subdivision 1; 
  2.23            352B.01, subdivisions 1, 2, 3; 352B.02, subdivision 
  2.24            1e; 352B.071; 352C.021, by adding a subdivision; 
  2.25            352C.091, subdivision 1; 352C.10; 352D.01; 352D.015, 
  2.26            subdivisions 3, 4; 352D.02, subdivision 1; 352D.03; 
  2.27            352D.05, subdivision 4; 352D.085, subdivision 1; 
  2.28            352D.09, subdivision 5; 352D.12; 353.01, subdivisions 
  2.29            6, 10, 14, 32, 33, by adding a subdivision; 353.025; 
  2.30            353.026; 353.027; 353.028; 353.14; 353.15, 
  2.31            subdivisions 1, 3; 353.27, subdivision 11; 353.271; 
  2.32            353.28, subdivisions 5, 6; 353.29, subdivision 3; 
  2.33            353.31, subdivision 1c; 353.32, subdivision 9; 353.33, 
  2.34            subdivisions 3, 12; 353.64, by adding a subdivision; 
  2.35            353.651, subdivision 3; 353.656, subdivision 1; 
  2.36            353F.02, subdivision 4; 354.05, subdivision 7, by 
  2.37            adding a subdivision; 354.091; 354.094, subdivision 1; 
  2.38            354.10, subdivisions 1, 3, 4; 354.33, subdivision 5; 
  2.39            354.39; 354.41, subdivision 2; 354.42, by adding a 
  2.40            subdivision; 354.44, subdivisions 2, 6; 354A.011, 
  2.41            subdivision 3a, by adding a subdivision; 354A.021, 
  2.42            subdivision 5, by adding a subdivision; 354A.097, 
  2.43            subdivision 1; 354A.31, subdivisions 4, 4a, 5; 
  2.44            354B.21, subdivisions 2, 3; 354B.25, subdivision 2; 
  2.45            355.01, subdivision 3e; 356.20, subdivision 4; 
  2.46            356.215, subdivision 8; 356.216; 356.24, subdivision 
  2.47            1; 356.47, subdivision 3; 356.551; 356.65, subdivision 
  2.48            2; 356A.06, subdivision 7; 383B.46, subdivision 2; 
  2.49            383B.47; 383B.48; 383B.49; 422A.01, subdivisions 6, 
  2.50            11, by adding a subdivision; 422A.05, subdivision 2c; 
  2.51            422A.06, subdivisions 3, 5, 7, 8; 422A.10, 
  2.52            subdivisions 1, 2; 422A.101, subdivision 3; 422A.15, 
  2.53            subdivision 1; 422A.16, subdivision 9; 422A.22, 
  2.54            subdivisions 1, 3, 4, 6; 422A.231; 422A.24; 423B.01, 
  2.55            subdivision 12; 423B.09, subdivision 1, by adding a 
  2.56            subdivision; 423B.10, subdivision 1; 423B.15, 
  2.57            subdivision 3; 423B.17; 423C.05, subdivision 2; 
  2.58            423C.09; 424A.02, subdivisions 3, 4, 7; 424A.04, 
  2.59            subdivision 1; 424B.10, subdivision 1; 471A.10; 
  2.60            490.121, subdivisions 1, 4, 6, 7, 13, 14, 15, 20, 21, 
  2.61            22, by adding subdivisions; 490.122; 490.123, 
  2.62            subdivisions 1, 1a, 1b, 1c, 2, 3; 490.124, 
  2.63            subdivisions 1, 2, 3, 4, 5, 8, 9, 10, 11, 12, 13; 
  2.64            490.125, subdivisions 1, 2; 490.126; 490.133; 525.05; 
  2.65            Laws 1999, chapter 222, article 16, section 16, as 
  2.66            amended; Laws 2000, chapter 461, article 4, section 4, 
  2.67            as amended; Laws 2004, chapter 267, article 12, 
  2.68            section 4; proposing coding for new law in Minnesota 
  2.69            Statutes, chapters 352C; 356; 383B; 423C; 424A; 
  2.70            proposing coding for new law as Minnesota Statutes, 
  2.71            chapter 490A; repealing Minnesota Statutes 2004, 
  3.1             sections 3A.01, subdivisions 3, 4, 6a, 7; 3A.02, 
  3.2             subdivision 2; 3A.04, subdivision 1a; 3A.09; 352.119, 
  3.3             subdivision 1; 352.15, subdivision 1a; 352C.01; 
  3.4             352C.011; 352C.021; 352C.031; 352C.033; 352C.04; 
  3.5             352C.051; 352C.09; 352C.091, subdivisions 2, 3; 
  3.6             353.15, subdivision 2; 353.29, subdivision 2; 353.34, 
  3.7             subdivision 3b; 353.36, subdivisions 2, 2a, 2b, 2c; 
  3.8             353.46, subdivision 4; 353.651, subdivision 2; 
  3.9             353.663; 353.74; 353.75; 354.10, subdivision 2; 
  3.10            354.59; 422A.101, subdivision 4; 422A.22, subdivisions 
  3.11            2, 5; 422A.221; 490.021; 490.025; 490.101; 490.102; 
  3.12            490.103; 490.105; 490.106; 490.107; 490.108; 490.109; 
  3.13            490.1091; 490.12; 490.121, subdivisions 2, 3, 5, 8, 9, 
  3.14            10, 11, 12, 16, 17, 18, 19, 20; 490.124, subdivision 
  3.15            6; 490.132; 490.15; 490.16; 490.18. 
  3.16  BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
  3.17                    2005 OMNIBUS RETIREMENT BILL
  3.18                             ARTICLE 1
  3.19                  CLARIFICATION/RECODIFICATION OF
  3.20                STATEWIDE SPECIALTY RETIREMENT PLANS
  3.21     Section 1.  Minnesota Statutes 2004, section 3A.01, 
  3.22  subdivision 1, is amended to read: 
  3.23     Subdivision 1.  [PURPOSES.] Each of the terms defined in 
  3.24  this section, for the purposes of this chapter shall be 
  3.25  given has the meanings meaning ascribed to them. 
  3.26     Sec. 2.  Minnesota Statutes 2004, section 3A.01, is amended 
  3.27  by adding a subdivision to read: 
  3.28     Subd. 1a.  [ACTUARIAL EQUIVALENT.] "Actuarial equivalent" 
  3.29  means the condition of one allowance or benefit having an equal 
  3.30  actuarial present value to another allowance or benefit, 
  3.31  determined by the actuary retained under section 356.214 as of a 
  3.32  given date at a specified age with each actuarial present value 
  3.33  based on the mortality table applicable for the plan and 
  3.34  approved under section 356.215, subdivision 18, and using the 
  3.35  applicable preretirement or postretirement interest rate 
  3.36  assumption specified in section 356.215, subdivision 8. 
  3.37     Sec. 3.  Minnesota Statutes 2004, section 3A.01, is amended 
  3.38  by adding a subdivision to read: 
  3.39     Subd. 1b.  [AVERAGE MONTHLY SALARY.] "Average monthly 
  3.40  salary" means the average of the member's highest five 
  3.41  successive years of salary that was received as a member of the 
  3.42  legislature and upon which the member has made contributions 
  3.43  under section 3A.03, subdivision 1, or for which the member of 
  4.1   the legislature has made payments for past service under 
  4.2   Minnesota Statutes 2004, section 3A.02, subdivision 2, or has 
  4.3   made, before July 1, 1994, payments in lieu of contributions 
  4.4   under Minnesota Statutes 1992, section 3A.031. 
  4.5      Sec. 4.  Minnesota Statutes 2004, section 3A.01, is amended 
  4.6   by adding a subdivision to read: 
  4.7      Subd. 1c.  [CONSTITUTIONAL OFFICER.] "Constitutional 
  4.8   officer" means a person who was duly elected, qualifies for, and 
  4.9   serves as the governor, the lieutenant governor, the attorney 
  4.10  general, the secretary of state, or the state auditor of the 
  4.11  state of Minnesota. 
  4.12     Sec. 5.  Minnesota Statutes 2004, section 3A.01, 
  4.13  subdivision 2, is amended to read: 
  4.14     Subd. 2.  [DEPENDENT CHILD.] (a) "Dependent child" means 
  4.15  any natural or adopted child of a deceased member of the 
  4.16  legislature or a former legislator who is under the age of 18, 
  4.17  or who is under the age of 22 and is a full-time student, and 
  4.18  who, in either case, is unmarried and was actually dependent for 
  4.19  more than one-half of support upon such the legislator for a 
  4.20  period of at least 90 days immediately prior to before the 
  4.21  legislator's death.  It 
  4.22     (b) The term also includes any child of the member of the 
  4.23  legislature or former legislator who was conceived during the 
  4.24  lifetime of, and who was born after the death of, the member or 
  4.25  former legislator.  This subdivision shall be retroactive as to 
  4.26  any dependent child under the age of 22 years as of April 1, 
  4.27  1975. 
  4.28     Sec. 6.  Minnesota Statutes 2004, section 3A.01, 
  4.29  subdivision 6, is amended to read: 
  4.30     Subd. 6.  [DIRECTOR.] "Director" means the executive 
  4.31  director of the Minnesota State Retirement System who was 
  4.32  appointed under section 352.03, subdivision 5. 
  4.33     Sec. 7.  Minnesota Statutes 2004, section 3A.01, is amended 
  4.34  by adding a subdivision to read: 
  4.35     Subd. 6b.  [FORMER LEGISLATOR.] "Former legislator" means a 
  4.36  legislator who has ceased to be a member of the legislature for 
  5.1   any reason, including, but not limited to, the expiration of the 
  5.2   term for which a member of the legislature was elected or the 
  5.3   death of the member. 
  5.4      Sec. 8.  Minnesota Statutes 2004, section 3A.01, is amended 
  5.5   by adding a subdivision to read: 
  5.6      Subd. 6c.  [MEMBER OF THE LEGISLATURE.] "Member of the 
  5.7   legislature" means a person who was a member of the House of 
  5.8   Representatives or of the Senate of the state of Minnesota who 
  5.9   has subscribed to the oath of office after July 1, 1965, and who 
  5.10  was first elected to a legislative office before July 1, 1997, 
  5.11  and retained coverage by the plan under Laws 1997, chapter 233, 
  5.12  article 2, section 15. 
  5.13     Sec. 9.  Minnesota Statutes 2004, section 3A.01, 
  5.14  subdivision 8, is amended to read: 
  5.15     Subd. 8.  [NORMAL RETIREMENT AGE.] "Normal retirement age" 
  5.16  means the age of 60 years with regard to any member of the 
  5.17  legislature whose service terminates prior to the beginning of 
  5.18  the 1981 legislative session, and the age of 62 years with 
  5.19  regard to any member of the legislature whose service terminates 
  5.20  after the beginning of the 1981 session. 
  5.21     Sec. 10.  Minnesota Statutes 2004, section 3A.01, is 
  5.22  amended by adding a subdivision to read: 
  5.23     Subd. 9.  [RETIREMENT.] "Retirement" means the period of 
  5.24  time after which a former legislator is entitled to a retirement 
  5.25  allowance. 
  5.26     Sec. 11.  Minnesota Statutes 2004, section 3A.01, is 
  5.27  amended by adding a subdivision to read: 
  5.28     Subd. 10.  [SALARY.] (a) "Salary" means the regular 
  5.29  compensation payable under law to a member of the legislature 
  5.30  and paid to the person for service as a legislator. 
  5.31     (b) The term includes the monthly compensation paid to the 
  5.32  member of the legislature and the per diem payments paid during 
  5.33  a regular or special session to the member of the legislature. 
  5.34     (c) The term does not include per diem payments paid to a 
  5.35  member of the legislature other than during the regular or 
  5.36  special session; additional compensation attributable to a 
  6.1   leadership position under section 3.099, subdivision 3; living 
  6.2   expense payments under section 3.101; and special session living 
  6.3   expense payments under section 3.103. 
  6.4      Sec. 12.  Minnesota Statutes 2004, section 3A.011, is 
  6.5   amended to read: 
  6.6      3A.011 [ADMINISTRATION OF PLAN.] 
  6.7      The executive director and the board of directors of the 
  6.8   Minnesota State Retirement System shall administer the 
  6.9   legislators retirement plan in accordance with this chapter and 
  6.10  chapter 356A. 
  6.11     Sec. 13.  Minnesota Statutes 2004, section 3A.02, 
  6.12  subdivision 1, is amended to read: 
  6.13     Subdivision 1.  [QUALIFICATIONS.] (a) A former legislator 
  6.14  is entitled, upon written application to the director, to 
  6.15  receive a retirement allowance monthly, if the person: 
  6.16     (1) has either served at least six full years, without 
  6.17  regard to the application of section 3A.10, subdivision 2, or 
  6.18  has served during all or part of four regular sessions as a 
  6.19  member of the legislature, which service need not be continuous; 
  6.20     (2) has attained the normal retirement age; 
  6.21     (3) has retired as a member of the legislature; and 
  6.22     (4) has made all contributions provided for in section 
  6.23  3A.03, has made payments for past service under subdivision 2, 
  6.24  or has made payments in lieu of contributions under Minnesota 
  6.25  Statutes 1992, section 3A.031, prior to before July 1, 1994. 
  6.26     (b) This paragraph applies to members of the legislature 
  6.27  who terminate service as a legislator before July 1, 1997.  For 
  6.28  service rendered before the beginning of the 1979 legislative 
  6.29  session, but not to exceed eight years of service, the 
  6.30  retirement allowance is an amount equal to five percent per year 
  6.31  of service of that member's average monthly salary.  For service 
  6.32  in excess of eight years rendered before the beginning of the 
  6.33  1979 legislative session, and for service rendered after the 
  6.34  beginning of the 1979 legislative session, Unless the former 
  6.35  legislator has legislative service before January 1, 1979, the 
  6.36  retirement allowance is an amount equal to 2-1/2 percent per 
  7.1   year of service of that member's average monthly salary. 
  7.2      (c) This paragraph applies to members of the legislature 
  7.3   who terminate service as a legislator after June 30, 1997.  The 
  7.4   retirement allowance is an amount equal to the applicable rate 
  7.5   or rates under paragraph (b) per year of service of the member's 
  7.6   average monthly salary and adjusted for that person on an 
  7.7   actuarial equivalent basis to reflect the change in the 
  7.8   postretirement interest rate actuarial assumption under section 
  7.9   356.215, subdivision 8, from five percent to six percent.  The 
  7.10  adjustment must be calculated by or, alternatively, the 
  7.11  adjustment procedure must be specified by, the actuary retained 
  7.12  by the Legislative Commission on Pensions and Retirement under 
  7.13  section 356.214.  The purpose of this adjustment is to ensure 
  7.14  that the total amount of benefits that the actuary predicts an 
  7.15  individual member will receive over the member's lifetime under 
  7.16  this paragraph will be the same as the total amount of benefits 
  7.17  the actuary predicts the individual member would receive over 
  7.18  the member's lifetime under the law in effect before enactment 
  7.19  of this paragraph.  If the former legislator has legislative 
  7.20  service before January 1, 1979, the person's benefit must 
  7.21  include the additional benefit amount in effect on January 1, 
  7.22  1979, and adjusted as otherwise provided in this paragraph. 
  7.23     (d) (c) The retirement allowance accrues beginning with the 
  7.24  first day of the month of receipt of the application, but not 
  7.25  before age 60, and for the remainder of the former legislator's 
  7.26  life, if the former legislator is not serving as a member of the 
  7.27  legislature or as a constitutional officer or commissioner as 
  7.28  defined in section 352C.021, subdivisions 2 and 3 section 3A.01, 
  7.29  subdivision 1c.  The annuity does not begin to accrue prior to 
  7.30  before the person's retirement as a legislator.  No annuity 
  7.31  payment may be made retroactive for more than 180 days before 
  7.32  the date that the annuity application is filed with the director.
  7.33     (e) (d) Any member who has served during all or part of 
  7.34  four regular sessions is considered to have served eight years 
  7.35  as a member of the legislature. 
  7.36     (f) (e) The retirement allowance ceases with the last 
  8.1   payment that accrued to the retired legislator during the 
  8.2   retired legislator's lifetime, except that the surviving spouse, 
  8.3   if any, is entitled to receive the retirement allowance of the 
  8.4   retired legislator for the calendar month in which the retired 
  8.5   legislator died. 
  8.6      Sec. 14.  Minnesota Statutes 2004, section 3A.02, 
  8.7   subdivision 1b, is amended to read: 
  8.8      Subd. 1b.  [REDUCED RETIREMENT ALLOWANCE.] (a) Upon 
  8.9   separation from service after the beginning of the 1981 
  8.10  legislative session, a former member of the legislature who has 
  8.11  attained the age set by the board of directors of the Minnesota 
  8.12  State Retirement System and who is otherwise qualified in 
  8.13  accordance with under subdivision 1 is entitled, upon making 
  8.14  written application on forms supplied a form prescribed by the 
  8.15  director, to a reduced retirement allowance in.  The reduced 
  8.16  retirement allowance is an amount equal to the retirement 
  8.17  allowance specified in subdivision 1, paragraph (b), that is 
  8.18  reduced so that the reduced annuity allowance is the actuarial 
  8.19  equivalent of the annuity allowance that would be payable if the 
  8.20  former member of the legislature deferred receipt of the annuity 
  8.21  allowance and the annuity allowance amount were was augmented 
  8.22  at an annual rate of three percent compounded annually from the 
  8.23  date the annuity allowance begins to accrue until age 62. 
  8.24     (b) The age set by the board of directors under paragraph 
  8.25  (a) cannot be less an earlier age than the early retirement age 
  8.26  under section 352.116, subdivision 1a. 
  8.27     (c) If there is an actuarial cost to the plan of resetting 
  8.28  the early retirement age under paragraph (a), the retired 
  8.29  legislator is required to pay an additional amount to cover the 
  8.30  full actuarial value.  The additional amount must be paid in a 
  8.31  lump sum within 30 days of the certification of the amount by 
  8.32  the executive director.  
  8.33     (d) The executive director of the Minnesota State 
  8.34  Retirement System shall report to the Legislative Commission on 
  8.35  Pensions and Retirement on the utilization of this 
  8.36  provision annually on or before September 1, 2000. 
  9.1      Sec. 15.  Minnesota Statutes 2004, section 3A.02, 
  9.2   subdivision 3, is amended to read: 
  9.3      Subd. 3.  [APPROPRIATION.] The amounts required for payment 
  9.4   of retirement allowances provided by this section are 
  9.5   appropriated annually to the director from the participation of 
  9.6   the legislators retirement plan in the Minnesota postretirement 
  9.7   investment fund and shall.  The retirement allowance must be 
  9.8   paid monthly to the recipients entitled thereto to those 
  9.9   retirement allowances. 
  9.10     Sec. 16.  Minnesota Statutes 2004, section 3A.02, 
  9.11  subdivision 4, is amended to read: 
  9.12     Subd. 4.  [DEFERRED ANNUITIES AUGMENTATION.] (a) The 
  9.13  deferred annuity retirement allowance of any former legislator 
  9.14  must be augmented as provided herein.  
  9.15     (b) The required reserves applicable to the 
  9.16  deferred annuity retirement allowance, determined as of the date 
  9.17  the benefit begins to accrue using an appropriate mortality 
  9.18  table and an interest assumption of six percent, must be 
  9.19  augmented from the first of the month following the termination 
  9.20  of active service, or July 1, 1973, whichever is later, to the 
  9.21  first day of the month in which the annuity allowance begins to 
  9.22  accrue, at the following annually compounded rate of five 
  9.23  percent per annum compounded annually until January 1, 1981, and 
  9.24  thereafter at the rate of three percent per annum compounded 
  9.25  annually until January 1 of the year in which the former 
  9.26  legislator attains age 55.  From that date to the effective date 
  9.27  of retirement, the rate is five percent compounded annually. or 
  9.28  rates: 
  9.29          rate                   period
  9.30       (1) five percent     until January 1, 1981
  9.31       (2) three percent    from January 1, 1981, or from the
  9.32                            first day of the month following
  9.33                            the termination of active service,
  9.34                            whichever is later, until January 1
  9.35                            of the year in which the former
  9.36                            legislator attains age 55
 10.2        (3) five percent     from the period end date under
 10.3                             clause (2) to the effective date 
 10.4                             of retirement. 
 10.5      (b) The retirement allowance of, or the survivor benefit 
 10.6   payable on behalf of, a former member of the legislature who 
 10.7   terminated service before July 1, 1997, which is not first 
 10.8   payable until after June 30, 1997, must be increased on an 
 10.9   actuarial equivalent basis to reflect the change in the 
 10.10  postretirement interest rate actuarial assumption under section 
 10.11  356.215, subdivision 8, from five percent to six percent under a 
 10.12  calculation procedure and tables adopted by the board of 
 10.13  directors of the Minnesota State Retirement System and approved 
 10.14  by the actuary retained by the Legislative Commission on 
 10.15  Pensions and Retirement. 
 10.16     Sec. 17.  Minnesota Statutes 2004, section 3A.02, 
 10.17  subdivision 5, is amended to read: 
 10.18     Subd. 5.  [OPTIONAL ANNUITIES.] (a) The board of directors 
 10.19  shall establish an optional retirement annuity in the form of a 
 10.20  joint and survivor annuity and an optional retirement annuity in 
 10.21  the form of a period certain and life thereafter.  Except as 
 10.22  provided in paragraph (b), these optional annuity forms must be 
 10.23  actuarially equivalent to the normal annuity allowance computed 
 10.24  under this section, plus the actuarial value of any surviving 
 10.25  spouse benefit otherwise potentially payable at the time of 
 10.26  retirement under section 3A.04, subdivision 1.  An individual 
 10.27  selecting an optional annuity under this subdivision waives and 
 10.28  the person's spouse waive any rights to surviving spouse 
 10.29  benefits under section 3A.04, subdivision 1. 
 10.30     (b) If a retired legislator selects the joint and survivor 
 10.31  annuity option, the retired legislator must receive a normal 
 10.32  single-life annuity allowance if the designated optional annuity 
 10.33  beneficiary dies before the retired legislator and no reduction 
 10.34  may be made in the annuity to provide for restoration of the 
 10.35  normal single-life annuity allowance in the event of the death 
 10.36  of the designated optional annuity beneficiary. 
 11.1      (c) The surviving spouse of a legislator who has attained 
 11.2   at least age 60 and who dies while a member of the legislature 
 11.3   may elect an optional joint and survivor annuity under paragraph 
 11.4   (a), in lieu of surviving spouse benefits under section 3A.04, 
 11.5   subdivision 1. 
 11.6      Sec. 18.  Minnesota Statutes 2004, section 3A.03, 
 11.7   subdivision 1, is amended to read: 
 11.8      Subdivision 1.  [PERCENTAGE.] (a) Every member of the 
 11.9   legislature shall contribute nine percent of total salary,. 
 11.10     (b) The contribution must be made by payroll deduction, 
 11.11  to and must be paid into the state treasury and deposited in the 
 11.12  general fund.  It shall be the duty of 
 11.13     (c) The director to must record the periodic contributions 
 11.14  of each member of the legislature and must credit such each 
 11.15  contribution to the member's account. 
 11.16     Sec. 19.  Minnesota Statutes 2004, section 3A.03, 
 11.17  subdivision 2, is amended to read: 
 11.18     Subd. 2.  [REFUND.] (a) A former member who has made 
 11.19  contributions under subdivision 1 and who is no longer a member 
 11.20  of the legislature is entitled to receive, upon written 
 11.21  application to the executive director on a form prescribed by 
 11.22  the executive director, a refund from the general fund of all 
 11.23  contributions credited to the member's account with interest 
 11.24  computed as provided in section 352.22, subdivision 2. 
 11.25     (b) The refund of contributions as provided in paragraph (a)
 11.26  terminates all rights of a former member of the legislature and 
 11.27  the survivors of the former member under this chapter. 
 11.28     (c) If the former member of the legislature again becomes a 
 11.29  member of the legislature after having taken a refund as 
 11.30  provided in paragraph (a), the member must be considered is a 
 11.31  new member of this plan the unclassified employees retirement 
 11.32  program of the Minnesota State Retirement System.  
 11.33     (d) However, the member may reinstate the rights and credit 
 11.34  for service previously forfeited under this chapter if the 
 11.35  member repays all refunds taken, plus interest at an annual rate 
 11.36  of 8.5 percent compounded annually from the date on which the 
 12.1   refund was taken to the date on which the refund is repaid.  
 12.2      (d) (e) No person may be required to apply for or to accept 
 12.3   a refund. 
 12.4      Sec. 20.  Minnesota Statutes 2004, section 3A.04, 
 12.5   subdivision 1, is amended to read: 
 12.6      Subdivision 1.  [SURVIVING SPOUSE.] (a) Upon the death of a 
 12.7   member of the legislature while serving as such a member after 
 12.8   June 30, 1973, or upon the death of a former member of the 
 12.9   legislature with at least the number of six full years of 
 12.10  service as required by section 3A.02, subdivision 1, clause 
 12.11  (1) or service in all or part of four regular legislative 
 12.12  sessions, the surviving spouse shall be paid is entitled to a 
 12.13  survivor benefit in the amount of. 
 12.14     (b) The surviving spouse benefit is one-half of the 
 12.15  retirement allowance of the member of the legislature computed 
 12.16  as though the member were at least normal retirement age on the 
 12.17  date of death and based upon the member's allowable service 
 12.18  or upon eight years, whichever is greater.  The augmentation 
 12.19  provided in section 3A.02, subdivision 4, if applicable, shall 
 12.20  must be applied for the period up to, and including, the month 
 12.21  of death.  
 12.22     (c) Upon the death of a former legislator receiving a 
 12.23  retirement allowance, the surviving spouse shall be is entitled 
 12.24  to one-half of the amount of the retirement allowance being paid 
 12.25  to the legislator.  Such 
 12.26     (d) The surviving spouse benefit shall be paid during is 
 12.27  payable for the lifetime of the surviving spouse. 
 12.28     Sec. 21.  Minnesota Statutes 2004, section 3A.04, 
 12.29  subdivision 2, is amended to read: 
 12.30     Subd. 2.  [DEPENDENT CHILDREN.] (a) Upon the death of a 
 12.31  member of the legislature while serving as a member, or upon the 
 12.32  death of a former member of the legislature who has rendered at 
 12.33  least the number of six full years of service as required by 
 12.34  section 3A.02, subdivision 1, clause (1) or service in all or 
 12.35  part of four regular legislative sessions and who was not 
 12.36  receiving a retirement allowance, each dependent child of the 
 13.1   member or former legislator shall be is entitled to receive a 
 13.2   survivor benefit in the following amount:  
 13.3      (1) for the first dependent child, a monthly allowance 
 13.4   which equals benefit equal to 25 percent of the monthly 
 13.5   retirement allowance of the member of the legislature or the 
 13.6   former legislator computed as though the member or the former 
 13.7   legislator had attained at least the normal retirement age on 
 13.8   the date of death and based upon the average monthly salary as 
 13.9   of the date of death or as of the date of termination, whichever 
 13.10  is applicable applies, and the member's allowable service or 
 13.11  eight years, whichever is greater; 
 13.12     (2) for each additional dependent child, a monthly 
 13.13  allowance which equals benefit equal to 12-1/2 percent of the 
 13.14  monthly retirement allowance of the member or the former 
 13.15  legislator computed as provided in the case of the first child 
 13.16  clause (1); but and 
 13.17     (3) the total amount paid to the surviving spouse and to 
 13.18  the dependent child or children shall may not exceed, in any 
 13.19  one month, 100 percent of the monthly retirement allowance of 
 13.20  the member or of the former legislator computed as provided in 
 13.21  the case of the first child clause (1).  
 13.22     (b) The augmentation provided in section 3A.02, subdivision 
 13.23  4, if applicable, shall be applied applies from the first day of 
 13.24  the month next following the date of the termination of the 
 13.25  person from service as a member of the legislature to the month 
 13.26  of the death of the person.  
 13.27     (c) Upon the death of a former legislator who was receiving 
 13.28  a retirement allowance, the a surviving dependent child shall be 
 13.29  is entitled to the applicable percentage specified above in 
 13.30  paragraph (a), clause (1) or (2), whichever applies, of the 
 13.31  amount of the allowance which was paid to the former legislator 
 13.32  for the month immediately prior to before the date of death of 
 13.33  the former legislator.  
 13.34     (d) The payments for dependent children shall must be made 
 13.35  to the surviving spouse or to the guardian of the estate of the 
 13.36  dependent children, if there is one.  
 14.1      Sec. 22.  Minnesota Statutes 2004, section 3A.04, 
 14.2   subdivision 3, is amended to read: 
 14.3      Subd. 3.  [PAYMENT.] The surviving spouse's spouse and 
 14.4   dependent children's child or children survivor benefits payable 
 14.5   under this section shall be paid are payable by the director 
 14.6   monthly in the same manner as retirement allowances are 
 14.7   authorized to be paid by this chapter.  
 14.8      Sec. 23.  Minnesota Statutes 2004, section 3A.04, 
 14.9   subdivision 4, is amended to read: 
 14.10     Subd. 4.  [DEATH REFUNDS.] (a) Upon the death of a member 
 14.11  of the legislature or of a former legislator who was not 
 14.12  receiving a retirement allowance, without leaving either a 
 14.13  surviving spouse or a dependent child or dependent children, the 
 14.14  last designated beneficiary named on a form that was filed with 
 14.15  the director before the death of the legislator, or if no 
 14.16  designation is filed, the estate of the member or the former 
 14.17  legislator, upon application, shall be is entitled to a refund. 
 14.18     (b) The refund is the amount of contributions credited to 
 14.19  the person's account plus interest as provided in section 3A.03, 
 14.20  subdivision 2, clause (2) paragraph (a). 
 14.21     Sec. 24.  Minnesota Statutes 2004, section 3A.04, is 
 14.22  amended by adding a subdivision to read: 
 14.23     Subd. 5.  [APPROPRIATION.] The survivor benefits and the 
 14.24  death refunds authorized by this section are appropriated to the 
 14.25  director from the general fund when they are due and payable. 
 14.26     Sec. 25.  Minnesota Statutes 2004, section 3A.05, is 
 14.27  amended to read: 
 14.28     3A.05 [APPLICATION FOR SURVIVOR BENEFIT.] 
 14.29     (a) Applications for survivor benefits pursuant to under 
 14.30  section 3A.04 shall must be filed with the director by the 
 14.31  surviving spouse and dependent child or children entitled to 
 14.32  benefits pursuant to under section 3A.04, or by the guardian of 
 14.33  the estate, if there is one, of the dependent child or children. 
 14.34     (b) Survivor benefits shall accrue as of the first day of 
 14.35  the month following the death of the member of the legislature 
 14.36  or former legislator and payments shall commence as of the first 
 15.1   of the month next following the filing of the application, 
 15.2   and shall be are retroactive to the date the benefit accrues; 
 15.3   provided, however, that no payment shall be retroactive for more 
 15.4   than or the first of the month occurring 12 months prior 
 15.5   to before the month in which the application is filed with the 
 15.6   director, whichever is earlier. 
 15.7      Sec. 26.  Minnesota Statutes 2004, section 3A.07, is 
 15.8   amended to read: 
 15.9      3A.07 [APPLICATION.] 
 15.10     (a) Except as provided in paragraph (b), this chapter 
 15.11  applies to members of the legislature in service after July 1, 
 15.12  1965, who otherwise meet the requirements of this chapter. 
 15.13     (b) Members of the legislature who were elected for the 
 15.14  first time after June 30, 1997, or members of the legislature 
 15.15  who were elected before July 1, 1997, and who, after July 1, 
 15.16  1998, elect not to be members of the plan established by this 
 15.17  chapter are covered by the unclassified employees retirement 
 15.18  program governed by chapter 352D. 
 15.19     (c) The post-July 1, 1998, coverage election under 
 15.20  paragraph (b) is irrevocable and must be made on a form 
 15.21  prescribed by the director.  The second chance referendum 
 15.22  election under Laws 2002, chapter 392, article 15, also is 
 15.23  irrevocable. 
 15.24     Sec. 27.  Minnesota Statutes 2004, section 3A.10, 
 15.25  subdivision 1, is amended to read: 
 15.26     Subdivision 1.  [SERVICE CREDIT FOR LEGISLATIVE TERM.] (a) 
 15.27  In the case of a member of the house of representatives, one 
 15.28  full term of office shall must be considered two full years of 
 15.29  service, notwithstanding the fact that the oath of office may be 
 15.30  was taken on different days each biennium.  
 15.31     (b) In the case of a member of the senate, one full term of 
 15.32  office shall must be considered four full years of service, 
 15.33  notwithstanding the fact that the oath of office may be was 
 15.34  taken on different days at the start of each term.  
 15.35     (c) For purposes of this chapter, a legislative term shall 
 15.36  must be deemed to commence on January 1st 1 and to end on 
 16.1   December 31st 31.  
 16.2      Sec. 28.  Minnesota Statutes 2004, section 3A.12, is 
 16.3   amended to read: 
 16.4      3A.12 [COVERAGE BY MORE THAN ONE RETIREMENT SYSTEM OR 
 16.5   ASSOCIATION.] 
 16.6      Subdivision 1.  [ENTITLEMENT TO ANNUITY.] (a) Any 
 16.7   legislator who has been an employee covered by a member of a 
 16.8   retirement plan listed in paragraph (b) is entitled, when 
 16.9   otherwise qualified, to a retirement allowance or annuity from 
 16.10  each plan if the total allowable service in all plans or in any 
 16.11  two of these plans totals ten or more years. 
 16.12     (b) This section applies to any retirement plan or program 
 16.13  administered by the Minnesota State Retirement System, or a 
 16.14  member of any retirement plan administered by the Public 
 16.15  Employees Retirement Association, including the Public Employees 
 16.16  Retirement Association police and fire fund, or the Teachers 
 16.17  Retirement Association, or the Minneapolis employees 
 16.18  retirement Fund plan, or the State Patrol retirement fund plan, 
 16.19  or any other public employee retirement system in the state of 
 16.20  Minnesota having a like provision but excluding all. 
 16.21     (c) This section does not apply to other funds retirement 
 16.22  plans providing benefits for police or firefighters, shall be 
 16.23  entitled when qualified to an annuity from each fund if the 
 16.24  total allowable service for which the legislator has credit in 
 16.25  all funds or in any two of these funds totals ten or more years, 
 16.26  provided. 
 16.27     (d) No portion of the allowable service upon which the 
 16.28  retirement annuity from one fund plan is based is again used in 
 16.29  the computation for benefits from another fund plan.  The 
 16.30  annuity from each fund shall plan must be determined by the 
 16.31  appropriate provisions of the law, except that the requirement 
 16.32  that a person must have at least ten a minimum number of years 
 16.33  of allowable service in the respective system or 
 16.34  association shall does not apply for the purposes of this 
 16.35  section provided if the combined service in two or more of these 
 16.36  funds plans equals ten or more years.  The augmentation of 
 17.1   deferred annuities provided in section 3A.02, subdivision 
 17.2   4, shall apply applies to the annuities accruing hereunder under 
 17.3   this section. 
 17.4      Subd. 2.  [REFUND REPAYMENT.] Any A former legislator who 
 17.5   has received a refund as provided in section 3A.03, subdivision 
 17.6   2, who is a currently contributing member of a retirement fund 
 17.7   plan specified in subdivision 1, paragraph (b), may repay the 
 17.8   refund as provided in section 3A.03, subdivision 2.  Any A 
 17.9   member of the legislature who has received a refund from any of 
 17.10  the funds retirement plans specified in subdivision 1, may repay 
 17.11  the refund to the respective fund plan under such terms and 
 17.12  conditions consistent with the law governing such fund the 
 17.13  retirement plan if the law governing such fund the plan permits 
 17.14  the repayment of refunds.  If the total amount to be repaid, 
 17.15  including principal and interest exceeds $2,000, repayment may 
 17.16  be made in three equal installments over a period of 18 months, 
 17.17  with the interest accrued during the period of the repayment 
 17.18  added to the final installment. 
 17.19     Sec. 29.  Minnesota Statutes 2004, section 3A.13, is 
 17.20  amended to read: 
 17.21     3A.13 [EXEMPTION FROM PROCESS AND TAXATION; HEALTH PREMIUM 
 17.22  DEDUCTION.] 
 17.23     (a) The provisions of section 352.15 shall apply to the 
 17.24  legislators retirement plan, chapter 3A.  
 17.25     (b) The executive director of the Minnesota State 
 17.26  Retirement System must, at the request of a retired legislator 
 17.27  who is enrolled in a health insurance plan covering state 
 17.28  employees, deduct the person's health insurance premiums from 
 17.29  the person's annuity and transfer the amount of the premium to a 
 17.30  health insurance carrier covering state employees. 
 17.31     Sec. 30.  [352C.001] [RETIREMENT PLAN; APPLICATION.] 
 17.32     (a) The retirement plan applicable to a former 
 17.33  constitutional officer who was first elected to a constitutional 
 17.34  office after July 1, 1967, and before July 1, 1997, is the 
 17.35  applicable portions of this chapter and chapter 356 in effect on 
 17.36  the date on which the person terminated active service as a 
 18.1   constitutional officer. 
 18.2      (b) Nothing in this section or section 31 or 77, 
 18.3   subdivision 2, is intended to reduce the benefits of former 
 18.4   constitutional officers or to adversely modify their eligibility 
 18.5   for benefits in effect as of the day before the effective date 
 18.6   of this section. 
 18.7      Sec. 31.  Minnesota Statutes 2004, section 352C.091, 
 18.8   subdivision 1, is amended to read: 
 18.9      Subdivision 1.  [ADMINISTRATIVE AGENCY AND STANDARDS.] This 
 18.10  chapter (a) The elected officers retirement plan must be 
 18.11  administered by the board of directors and the executive 
 18.12  director of the Minnesota State Retirement System.  
 18.13     (b) The elected state officers retirement plan must be 
 18.14  administered consistent with this chapter the applicable 
 18.15  statutory provisions governing the plan and chapters 356 and 
 18.16  356A. 
 18.17     Sec. 32.  Minnesota Statutes 2004, section 352C.10, is 
 18.18  amended to read: 
 18.19     352C.10 [BENEFIT ADJUSTMENTS.] 
 18.20     Retirement allowances payable to retired constitutional 
 18.21  officers pursuant to section 352C.031 and surviving spouse 
 18.22  benefits payable pursuant to section 352C.04, shall must be 
 18.23  adjusted in the same manner, at the same times and in the same 
 18.24  amounts as are benefits payable from the Minnesota 
 18.25  postretirement investment fund to retirees of a participating 
 18.26  public pension fund.  
 18.27     Sec. 33.  Minnesota Statutes 2004, section 352D.02, 
 18.28  subdivision 1, is amended to read: 
 18.29     Subdivision 1.  [COVERAGE.] (a) Employees enumerated in 
 18.30  paragraph (c), clauses (2), (3), (4), and (6) to (14), if they 
 18.31  are in the unclassified service of the state or Metropolitan 
 18.32  Council and are eligible for coverage under the general state 
 18.33  employees retirement plan under chapter 352, are participants in 
 18.34  the unclassified plan under this chapter unless the employee 
 18.35  gives notice to the executive director of the Minnesota State 
 18.36  Retirement System within one year following the commencement of 
 19.1   employment in the unclassified service that the employee desires 
 19.2   coverage under the general state employees retirement plan.  For 
 19.3   the purposes of this chapter, an employee who does not file 
 19.4   notice with the executive director is deemed to have exercised 
 19.5   the option to participate in the unclassified plan. 
 19.6      (b) Persons referenced in paragraph (c), clauses (1) and 
 19.7   clause (5), are participants in the unclassified program under 
 19.8   this chapter unless the person is eligible to elect different 
 19.9   coverage under section 3A.07 or 352C.011 and, after July 1, 
 19.10  1998, elects elected retirement coverage by the applicable 
 19.11  alternative retirement plan.  Persons referenced in paragraph 
 19.12  (c), clause (15), are participants in the unclassified program 
 19.13  under this chapter for judicial employment in excess of the 
 19.14  service credit limit in section 490.121, subdivision 22. 
 19.15     (c) Enumerated employees and referenced persons are: 
 19.16     (1) the governor, the lieutenant governor, the secretary of 
 19.17  state, the state auditor, and the attorney general; 
 19.18     (2) an employee in the Office of the Governor, Lieutenant 
 19.19  Governor, Secretary of State, State Auditor, Attorney General; 
 19.20     (3) an employee of the State Board of Investment; 
 19.21     (4) the head of a department, division, or agency created 
 19.22  by statute in the unclassified service, an acting department 
 19.23  head subsequently appointed to the position, or an employee 
 19.24  enumerated in section 15A.0815 or 15A.083, subdivision 4; 
 19.25     (5) a member of the legislature; 
 19.26     (6) a full-time unclassified employee of the legislature or 
 19.27  a commission or agency of the legislature who is appointed 
 19.28  without a limit on the duration of the employment or a temporary 
 19.29  legislative employee having shares in the supplemental 
 19.30  retirement fund as a result of former employment covered by this 
 19.31  chapter, whether or not eligible for coverage under the 
 19.32  Minnesota State Retirement System; 
 19.33     (7) a person who is employed in a position established 
 19.34  under section 43A.08, subdivision 1, clause (3), or in a 
 19.35  position authorized under a statute creating or establishing a 
 19.36  department or agency of the state, which is at the deputy or 
 20.1   assistant head of department or agency or director level; 
 20.2      (8) the regional administrator, or executive director of 
 20.3   the Metropolitan Council, general counsel, division directors, 
 20.4   operations managers, and other positions as designated by the 
 20.5   council, all of which may not exceed 27 positions at the council 
 20.6   and the chair; 
 20.7      (9) the executive director, associate executive director, 
 20.8   and not to exceed nine positions of the Higher Education 
 20.9   Services Office in the unclassified service, as designated by 
 20.10  the Higher Education Services Office before January 1, 1992, or 
 20.11  subsequently redesignated with the approval of the board of 
 20.12  directors of the Minnesota State Retirement System, unless the 
 20.13  person has elected coverage by the individual retirement account 
 20.14  plan under chapter 354B; 
 20.15     (10) the clerk of the appellate courts appointed under 
 20.16  article VI, section 2, of the Constitution of the state of 
 20.17  Minnesota; 
 20.18     (11) the chief executive officers of correctional 
 20.19  facilities operated by the Department of Corrections and of 
 20.20  hospitals and nursing homes operated by the Department of Human 
 20.21  Services; 
 20.22     (12) an employee whose principal employment is at the state 
 20.23  ceremonial house; 
 20.24     (13) an employee of the Minnesota Educational Computing 
 20.25  Corporation; 
 20.26     (14) an employee of the State Lottery who is covered by the 
 20.27  managerial plan established under section 43A.18, subdivision 3; 
 20.28  and 
 20.29     (15) a judge who has exceeded the service credit limit in 
 20.30  section 490.121, subdivision 22. 
 20.31     Sec. 34.  Minnesota Statutes 2004, section 355.01, 
 20.32  subdivision 3e, is amended to read: 
 20.33     Subd. 3e.  [JUDGE.] "Judge" means a judge as defined in 
 20.34  section 490.121, subdivision 3 21a. 
 20.35     Sec. 35.  Minnesota Statutes 2004, section 356.65, 
 20.36  subdivision 2, is amended to read: 
 21.1      Subd. 2.  [DISPOSITION OF ABANDONED AMOUNTS.] Any unclaimed 
 21.2   public pension fund amounts existing in any public pension fund 
 21.3   are presumed to be abandoned, but are not subject to the 
 21.4   provisions of sections 345.31 to 345.60.  Unless the benefit 
 21.5   plan of the public pension fund specifically provides for a 
 21.6   different disposition of unclaimed or abandoned funds or 
 21.7   amounts, any unclaimed public pension fund amounts cancel and 
 21.8   must be credited to the public pension fund.  If the unclaimed 
 21.9   public pension fund amount exceeds $25 and the inactive or 
 21.10  former member again becomes a member of the applicable public 
 21.11  pension plan or applies for a retirement annuity under section 
 21.12  3A.12, 352.72, 352B.30, 352C.051, 353.71, 354.60, 356.30, or 
 21.13  422A.16, subdivision 8, whichever applies, the canceled amount 
 21.14  must be restored to the credit of the person. 
 21.15     Sec. 36.  Minnesota Statutes 2004, section 490.121, 
 21.16  subdivision 1, is amended to read: 
 21.17     Subdivision 1.  [SCOPE.] For purposes of sections 490.121 
 21.18  to 490.132, unless the context clearly indicates otherwise, each 
 21.19  of the terms defined in this section have has the meanings 
 21.20  meaning given them unless the context clearly indicates 
 21.21  otherwise it. 
 21.22     Sec. 37.  Minnesota Statutes 2004, section 490.121, is 
 21.23  amended by adding a subdivision to read: 
 21.24     Subd. 2a.  [ACTUARIAL EQUIVALENT.] "Actuarial equivalent" 
 21.25  means the condition of one annuity or benefit having an equal 
 21.26  actuarial present value as another annuity or benefit, 
 21.27  determined as of a given date with each actuarial present value 
 21.28  based on the appropriate mortality table adopted by the board of 
 21.29  directors of the Minnesota State Retirement System based on the 
 21.30  experience of the fund as recommended by the actuary retained 
 21.31  under section 356.214 and approved under section 356.215, 
 21.32  subdivision 18, and using the applicable preretirement or 
 21.33  postretirement interest rate assumption specified in section 
 21.34  356.215, subdivision 8. 
 21.35     Sec. 38.  Minnesota Statutes 2004, section 490.121, 
 21.36  subdivision 4, is amended to read: 
 22.1      Subd. 4.  [ALLOWABLE SERVICE.] (a) "Allowable service" 
 22.2   means any calendar month, subject to the service credit limit in 
 22.3   subdivision 22, served as a judge at any time, or during which 
 22.4   the judge received compensation for that service from the state, 
 22.5   municipality, or county, whichever applies, and for which the 
 22.6   judge made any required member contribution.  It also includes 
 22.7   any month served as a referee in probate for all referees in 
 22.8   probate who were in office prior to before January 1, 1974. 
 22.9      (b) "Allowable service" does not mean service as a retired 
 22.10  judge. 
 22.11     Sec. 39.  Minnesota Statutes 2004, section 490.121, 
 22.12  subdivision 6, is amended to read: 
 22.13     Subd. 6.  [ANNUITY.] "Annuity" means the payments that are 
 22.14  made each year to an annuitant from the judges' retirement fund, 
 22.15  pursuant to the provisions of under sections 490.121 to 490.132. 
 22.16     Sec. 40.  Minnesota Statutes 2004, section 490.121, 
 22.17  subdivision 7, is amended to read: 
 22.18     Subd. 7.  [ANNUITANT.] "Annuitant" means a former judge, a 
 22.19  surviving spouse, or a dependent child who is entitled to and is 
 22.20  receiving an annuity under the provisions of sections 490.121 to 
 22.21  490.132. 
 22.22     Sec. 41.  Minnesota Statutes 2004, section 490.121, is 
 22.23  amended by adding a subdivision to read: 
 22.24     Subd. 7a.  [APPROVED ACTUARY.] "Approved actuary" means an 
 22.25  actuary as defined in section 356.215, subdivision 1, paragraph 
 22.26  (c).  
 22.27     Sec. 42.  Minnesota Statutes 2004, section 490.121, is 
 22.28  amended by adding a subdivision to read: 
 22.29     Subd. 7b.  [COURT.] "Court" means any court of this state 
 22.30  that is established by the Minnesota Constitution. 
 22.31     Sec. 43.  Minnesota Statutes 2004, section 490.121, is 
 22.32  amended by adding a subdivision to read: 
 22.33     Subd. 7c.  [DEPENDENT SURVIVING CHILD.] "Dependent 
 22.34  surviving child" means any natural or adopted child of a 
 22.35  deceased judge who has not reached the age of 18 years, or 
 22.36  having reached the age of 18, is under age 22 and who is a 
 23.1   full-time student throughout the normal school year, is 
 23.2   unmarried, and is actually dependent for more than one-half of 
 23.3   the child's support upon the judge for a period of at least 90 
 23.4   days before the judge's death.  It also includes any natural 
 23.5   child of the judge who was born after the death of the judge. 
 23.6      Sec. 44.  Minnesota Statutes 2004, section 490.121, 
 23.7   subdivision 13, is amended to read: 
 23.8      Subd. 13.  [DISABILITY.] "Disability" means the permanent 
 23.9   inability of a judge to continue to perform the functions of 
 23.10  judge by reason of a physical or mental impairment resulting 
 23.11  from a sickness or an injury. 
 23.12     Sec. 45.  Minnesota Statutes 2004, section 490.121, 
 23.13  subdivision 14, is amended to read: 
 23.14     Subd. 14.  [DISABILITY RETIREMENT DATE.] "Disability 
 23.15  retirement date" means the last day of the first month after the 
 23.16  date on which the governor determines, upon receipt of the 
 23.17  voluntary application by the judge or otherwise, that a judge 
 23.18  suffers from a disability. 
 23.19     Sec. 46.  Minnesota Statutes 2004, section 490.121, 
 23.20  subdivision 15, is amended to read: 
 23.21     Subd. 15.  [DISABILITY RETIREMENT ANNUITY.] "Disability 
 23.22  retirement annuity" means an annuity to which a judge is 
 23.23  entitled under section 490.124, subdivisions 1 and 4, after the 
 23.24  retirement for reason of the judge because of a disability. 
 23.25     Sec. 47.  Minnesota Statutes 2004, section 490.121, is 
 23.26  amended by adding a subdivision to read: 
 23.27     Subd. 15a.  [EARLY RETIREMENT DATE.] "Early retirement date"
 23.28  means the last day of the month after a judge attains the age of 
 23.29  60 but before the judge reaches the normal retirement date. 
 23.30     Sec. 48.  Minnesota Statutes 2004, section 490.121, is 
 23.31  amended by adding a subdivision to read: 
 23.32     Subd. 15b.  [EARLY RETIREMENT ANNUITY.] "Early retirement 
 23.33  annuity" means an annuity to which a judge is entitled under 
 23.34  section 490.124, subdivisions 1 and 3, upon retirement by the 
 23.35  judge at an early retirement date. 
 23.36     Sec. 49.  Minnesota Statutes 2004, section 490.121, 
 24.1   subdivision 21, is amended to read: 
 24.2      Subd. 21.  [FINAL AVERAGE COMPENSATION.] "Final average 
 24.3   compensation" means the total amount of the salary payable to a 
 24.4   judge in the highest five years out of the last ten years prior 
 24.5   to before the event of maturity of benefits termination of 
 24.6   judicial service, divided by five; provided, however, that if 
 24.7   the number of years of service by the judge equals or exceeds 
 24.8   ten.  If the number of years of service by the judge is less 
 24.9   than ten, but more than five, the highest five shall years of 
 24.10  salary must be counted, and.  If the number of years of service 
 24.11  by the judge is less than five, the aggregate salary in such for 
 24.12  the period shall of service must be divided by the number of 
 24.13  months in such the period and multiplied by 12. 
 24.14     Sec. 50.  Minnesota Statutes 2004, section 490.121, is 
 24.15  amended by adding a subdivision to read: 
 24.16     Subd. 21a.  [JUDGE.] "Judge" means a judge or a justice of 
 24.17  any court as defined under subdivision 7b. 
 24.18     Sec. 51.  Minnesota Statutes 2004, section 490.121, is 
 24.19  amended by adding a subdivision to read: 
 24.20     Subd. 21b.  [JUDGES' RETIREMENT FUND; RETIREMENT FUND; 
 24.21  FUND.] "Judges' retirement fund," "retirement fund," or "fund" 
 24.22  means the fund created by section 490.123. 
 24.23     Sec. 52.  Minnesota Statutes 2004, section 490.121, is 
 24.24  amended by adding a subdivision to read: 
 24.25     Subd. 21c.  [MANDATORY RETIREMENT DATE.] "Mandatory 
 24.26  retirement date" means the last day of the month in which a 
 24.27  judge has attained 70 years of age. 
 24.28     Sec. 53.  Minnesota Statutes 2004, section 490.121, is 
 24.29  amended by adding a subdivision to read: 
 24.30     Subd. 21d.  [NORMAL RETIREMENT ANNUITY.] Except as 
 24.31  otherwise provided in sections 490.121 to 490.132, "normal 
 24.32  retirement annuity" means an annuity to which a judge is 
 24.33  entitled under section 490.124, subdivision 1, upon retirement 
 24.34  on or after the normal retirement date of the judge. 
 24.35     Sec. 54.  Minnesota Statutes 2004, section 490.121, is 
 24.36  amended by adding a subdivision to read: 
 25.1      Subd. 21e.  [NORMAL RETIREMENT DATE.] "Normal retirement 
 25.2   date" means the last day of the month in which a judge attains 
 25.3   the age of 65. 
 25.4      Sec. 55.  Minnesota Statutes 2004, section 490.121, 
 25.5   subdivision 22, is amended to read: 
 25.6      Subd. 22.  [SERVICE CREDIT LIMIT.] "Service credit limit" 
 25.7   means the greater of:  (1) 24 years of allowable service 
 25.8   under this chapter 490; or (2) for judges with allowable service 
 25.9   rendered prior to before July 1, 1980, the number of years of 
 25.10  allowable service under chapter 490, which, when multiplied by 
 25.11  the percentage listed in section 356.315, subdivision 7 or 8, 
 25.12  whichever is applicable to each year of service, equals 76.8. 
 25.13     Sec. 56.  Minnesota Statutes 2004, section 490.121, is 
 25.14  amended by adding a subdivision to read: 
 25.15     Subd. 23.  [SURVIVING SPOUSE.] "Surviving spouse" means the 
 25.16  surviving legally married spouse of a deceased judge. 
 25.17     Sec. 57.  Minnesota Statutes 2004, section 490.121, is 
 25.18  amended by adding a subdivision to read: 
 25.19     Subd. 24.  [SURVIVOR'S ANNUITY.] "Survivor's annuity" means 
 25.20  an annuity to which a surviving spouse or dependent child is 
 25.21  entitled under section 490.124, subdivision 9. 
 25.22     Sec. 58.  Minnesota Statutes 2004, section 490.122, is 
 25.23  amended to read: 
 25.24     490.122 [ADMINISTRATION OF JUDGES' RETIREMENT.] 
 25.25     Subdivision 1.  [ADMINISTRATION.] The policy-making, 
 25.26  management, and administrative functions governing the operation 
 25.27  of the judges' retirement fund and the administration 
 25.28  of sections 490.121 to 490.132 this chapter are vested in the 
 25.29  board of directors and executive director of the Minnesota State 
 25.30  Retirement System with such.  In administering the plan and 
 25.31  fund, the board and the director have the same duties, 
 25.32  authority, and responsibility as are provided in chapter 352.  
 25.33     Subd. 2.  [INAPPLICABILITY OF CERTAIN LAWS.] Except as 
 25.34  otherwise specified, no provision of chapter 352 applies to the 
 25.35  judges' retirement fund or any judge.  
 25.36     Subd. 3.  [FIDUCIARY RESPONSIBILITY.] Fiduciary 
 26.1   activities of relating to the uniform judges' retirement and 
 26.2   Survivors' Annuities for Judges plan must be undertaken in a 
 26.3   manner consistent with chapter 356A. 
 26.4      Sec. 59.  Minnesota Statutes 2004, section 490.123, 
 26.5   subdivision 1, is amended to read: 
 26.6      Subdivision 1.  [FUND CREATION; REVENUE AND AUTHORIZED 
 26.7   DISBURSEMENTS.] (a) There is created a special fund to be known 
 26.8   as the "judges' retirement fund." 
 26.9      (b) The judges' retirement fund must be credited with all 
 26.10  contributions,; all interest, dividends, and other investment 
 26.11  proceeds; and all other income authorized by this chapter or 
 26.12  other applicable law.  
 26.13     (c) From this fund there are appropriated the payments 
 26.14  authorized by sections 490.121 to 490.132, in the amounts and at 
 26.15  the times provided, including the necessary and reasonable 
 26.16  expenses of the Minnesota State Retirement System in 
 26.17  administering the fund and the transfers to the Minnesota 
 26.18  postretirement investment fund.  
 26.19     Sec. 60.  Minnesota Statutes 2004, section 490.123, 
 26.20  subdivision 1a, is amended to read: 
 26.21     Subd. 1a.  [MEMBER CONTRIBUTION RATES.] (a) A judge who is 
 26.22  covered by the federal Old Age, Survivors, Disability, and 
 26.23  Health Insurance Program and whose service does not exceed the 
 26.24  service credit limit in section 490.121, subdivision 22, shall 
 26.25  contribute to the fund from each salary payment a sum equal to 
 26.26  8.00 percent of salary.  
 26.27     (b) A judge not so covered whose service does not exceed 
 26.28  the service credit limit in section 490.121, subdivision 22, 
 26.29  shall contribute to the fund from each salary payment a sum 
 26.30  equal to 8.15 percent of salary. 
 26.31     (c) The contribution under this subdivision is payable by 
 26.32  salary deduction.  The deduction must be made by the state court 
 26.33  administrator under section 352.04, subdivisions 4, 5, and 8. 
 26.34     Sec. 61.  Minnesota Statutes 2004, section 490.123, 
 26.35  subdivision 1b, is amended to read: 
 26.36     Subd. 1b.  [EMPLOYER CONTRIBUTION RATE.] (a) The employer 
 27.1   contribution rate to the fund on behalf of a judge is 20.5 
 27.2   percent of salary and.  The employer obligation continues after 
 27.3   a judge exceeds the service credit limit in section 490.121, 
 27.4   subdivision 22. 
 27.5      (b) The employer contribution must be paid by the state 
 27.6   court administrator and.  The employer contribution is payable 
 27.7   at the same time as member contributions are made under 
 27.8   subdivision 1a or as employee contributions are made to the 
 27.9   unclassified plan in program governed by chapter 352D for judges 
 27.10  whose service exceeds the limit in section 490.121, subdivision 
 27.11  22, are remitted. 
 27.12     Sec. 62.  Minnesota Statutes 2004, section 490.123, 
 27.13  subdivision 1c, is amended to read: 
 27.14     Subd. 1c.  [ADDITIONAL EMPLOYER CONTRIBUTION.] In the event 
 27.15  that If the employer contribution under subdivision 1b and the 
 27.16  assets of the judges retirement fund are insufficient to meet 
 27.17  reserve transfers to the Minnesota postretirement investment 
 27.18  fund or payments of survivor benefits before July 1, 1993 in a 
 27.19  month, the necessary amount is appropriated from the general 
 27.20  fund to the executive director of the Minnesota State Retirement 
 27.21  System, upon the certification of the required amount by the 
 27.22  executive director to the commissioner of finance. 
 27.23     Sec. 63.  Minnesota Statutes 2004, section 490.123, 
 27.24  subdivision 2, is amended to read: 
 27.25     Subd. 2.  [COMMISSIONER OF FINANCE.] The commissioner of 
 27.26  finance shall be is the ex officio treasurer of the judges' 
 27.27  retirement fund and the.  The commissioner's general bond to the 
 27.28  state shall must be so conditioned as to cover all liability for 
 27.29  acting as the treasurer of this the fund.  All moneys money 
 27.30  received by the commissioner pursuant to under this section 
 27.31  shall must be set aside in the state treasury to the credit of 
 27.32  the judges' retirement fund.  The commissioner shall transmit 
 27.33  monthly to the executive director described in section 352.03, 
 27.34  subdivision 5, a detailed statement of all amounts so received 
 27.35  and credited to the fund.  The commissioner shall pay out the 
 27.36  fund only upon vouchers signed by said executive director; 
 28.1   provided that vouchers for investment may be signed by the 
 28.2   secretary of the State Board of Investment. 
 28.3      Sec. 64.  Minnesota Statutes 2004, section 490.123, 
 28.4   subdivision 3, is amended to read: 
 28.5      Subd. 3.  [INVESTMENT.] (a) The executive director referred 
 28.6   to in subdivision 2 of the Minnesota State Retirement System 
 28.7   shall, from time to time, certify to the State Board of 
 28.8   Investment such portions of the judges' retirement fund as in 
 28.9   the director's judgment may not be required for immediate use.  
 28.10     (b) Assets from the judges' retirement fund shall must be 
 28.11  transferred to the Minnesota postretirement investment fund for 
 28.12  retirement and disability benefits as provided in sections 
 28.13  11A.18 and 352.119.  
 28.14     (c) The State Board of Investment shall thereupon invest 
 28.15  and reinvest sums so transferred, or certified, in such 
 28.16  securities as are duly authorized legal investments for such 
 28.17  purposes under section 11A.24 in compliance with sections 
 28.18  356A.04 and 356A.06.  
 28.19     Sec. 65.  Minnesota Statutes 2004, section 490.124, 
 28.20  subdivision 1, is amended to read: 
 28.21     Subdivision 1.  [BASIC RETIREMENT ANNUITY.] (a) Except as 
 28.22  qualified hereinafter from and after the mandatory retirement 
 28.23  date, the normal retirement date, the early retirement date, or 
 28.24  one year from the disability retirement date, as the case may 
 28.25  be, a retiring judge is eligible to receive a retirement annuity 
 28.26  shall be payable to a retiring judge from the judges' retirement 
 28.27  fund in. 
 28.28     (b) The retirement annuity is an amount equal to:  (1) the 
 28.29  percent specified in section 356.315, subdivision 7, multiplied 
 28.30  by the judge's final average compensation with that result then 
 28.31  multiplied by the number of years and fractions of years of 
 28.32  allowable service rendered prior to before July 1, 1980; plus 
 28.33  (2) the percent specified in section 356.315, subdivision 8, 
 28.34  multiplied by the judge's final average compensation with that 
 28.35  result then multiplied by the number of years and fractions of 
 28.36  years of allowable service rendered after June 30, 1980. 
 29.1      (c) Service that exceeds the service credit limit in 
 29.2   section 490.121, subdivision 22, must be excluded in calculating 
 29.3   the retirement annuity, but the compensation earned by the judge 
 29.4   during this period of judicial service must be used in 
 29.5   determining a judge's final average compensation and calculating 
 29.6   the retirement annuity.  
 29.7      Sec. 66.  Minnesota Statutes 2004, section 490.124, 
 29.8   subdivision 2, is amended to read: 
 29.9      Subd. 2.  [MINIMUM SERVICE REQUIREMENT; EXTENSION OF TERM.] 
 29.10  No (a) Unless section 356.30 applies, a judge shall be is not 
 29.11  eligible for an annuity at the normal retirement date or the 
 29.12  early retirement date if the judge has less than five years of 
 29.13  allowable service.  
 29.14     (b) A judge who shall retire retires on or, as permitted 
 29.15  under sections 490.121 to 490.132, after the judge's mandatory 
 29.16  retirement date, shall be is entitled to a proportionate annuity 
 29.17  based upon the allowable service of the judge at the date of 
 29.18  retirement. 
 29.19     A judge who was in office on December 31, 1973, and 
 29.20  thereafter and who, by the date on which the current term 
 29.21  expires, would not be eligible to retire with full benefits 
 29.22  under statutes in effect on December 31, 1973, may apply to the 
 29.23  governor for an extension to serve up to three additional years, 
 29.24  stating the intention of the judge to retire upon attaining 
 29.25  eligibility to receive a retirement allowance.  Notwithstanding 
 29.26  section 490.125, the governor shall forthwith make a written 
 29.27  order accepting the retirement application, and extending the 
 29.28  term of office of the judge for the period of time, not to 
 29.29  exceed three years, as may be necessary to make the judge 
 29.30  eligible for retirement, solely for purposes of computing 
 29.31  benefits hereunder. 
 29.32     Sec. 67.  Minnesota Statutes 2004, section 490.124, 
 29.33  subdivision 3, is amended to read: 
 29.34     Subd. 3.  [EARLY REDUCED RETIREMENT.] The retirement 
 29.35  annuity provided by under subdivision 1 of any judge electing 
 29.36  who elects to retire at an early retirement date shall must be 
 30.1   reduced by one-half of one percent per month from the retirement 
 30.2   date to the normal retirement date. 
 30.3      Sec. 68.  Minnesota Statutes 2004, section 490.124, 
 30.4   subdivision 4, is amended to read: 
 30.5      Subd. 4.  [DISABILITY RETIREMENT.] (a) When the governor 
 30.6   determines that a judge is disabled under section 490.121, 
 30.7   subdivision 13, notice of the governor's determination must be 
 30.8   sent to the judge, the chief justice of the Supreme Court, the 
 30.9   state court administrator, and the executive director of the 
 30.10  Minnesota State Retirement System. 
 30.11     (b) From and after disability retirement date, a disabled 
 30.12  judge shall be is entitled to continuation of the judge's full 
 30.13  salary payable by the judge's employer, as if the judge's office 
 30.14  were not vacated by retirement, for a period of up to one full 
 30.15  year, but in no event beyond the judge's mandatory retirement 
 30.16  date.  During this year the judge will is entitled to earn 
 30.17  additional service credit in the judges' retirement plan.  The 
 30.18  salary earned will be payable to a disabled judge is subject to 
 30.19  retirement deductions and will must be included in computing 
 30.20  final average compensation of the judge.  Thereafter 
 30.21     (c) At the conclusion of the year of continued salary 
 30.22  following a disability or upon the judge's mandatory retirement 
 30.23  date, whichever is earlier, the disabled judge is entitled to a 
 30.24  disability retirement annuity computed as provided in 
 30.25  subdivision 1 shall be paid, provided that.  If the computed 
 30.26  retirement annuity is a smaller amount, the judge shall is 
 30.27  entitled to receive a minimum annuity of 25 percent of the 
 30.28  judge's final average compensation. 
 30.29     Sec. 69.  Minnesota Statutes 2004, section 490.124, 
 30.30  subdivision 5, is amended to read: 
 30.31     Subd. 5.  [DEFERRED BENEFITS.] (a) Any A benefit to which a 
 30.32  judge is entitled under this section may be deferred until the 
 30.33  early or normal retirement date or later, notwithstanding the 
 30.34  termination of such the judge's service prior thereto. 
 30.35     (b) The retirement annuity of, or the survivor benefit 
 30.36  payable on behalf of, a former judge, who terminated service 
 31.1   before July 1, 1997, which is not first payable until after June 
 31.2   30, 1997, must be increased on an actuarial equivalent basis to 
 31.3   reflect the change in the postretirement interest rate actuarial 
 31.4   assumption under section 356.215, subdivision 8, from five 
 31.5   percent to six percent under a calculation procedure and tables 
 31.6   adopted by the board of directors of the Minnesota State 
 31.7   Retirement System and approved by the actuary retained by the 
 31.8   Legislative Commission on Pensions and Retirement under section 
 31.9   356.214. 
 31.10     Sec. 70.  Minnesota Statutes 2004, section 490.124, 
 31.11  subdivision 8, is amended to read: 
 31.12     Subd. 8.  [EXCLUSIVE NORMAL RETIREMENT BENEFITS.] Any (a) 
 31.13  Except as provided in paragraph (b), a judge who retires after 
 31.14  December 31, 1973, shall be is entitled to a retirement pension, 
 31.15  retirement compensation or other retirement payment under 
 31.16  statutes applicable solely to judges pursuant to under this 
 31.17  section only, except that any such. 
 31.18     (b) A judge who was in office prior to before January 1, 
 31.19  1974, who retires at or after normal retirement age may then 
 31.20  elect to receive during the judge's lifetime a normal retirement 
 31.21  annuity computed on the basis of retirement compensation 
 31.22  provided for such judge under statutes in effect on December 31, 
 31.23  1973, in lieu of the amount of normal retirement annuity 
 31.24  otherwise computed under sections 490.121 to 490.132.  
 31.25     For purposes of this subdivision, the Conciliation Court of 
 31.26  the city of Duluth shall be deemed to have been a court of 
 31.27  record by the statutes in effect on December 31, 1973.  
 31.28     Sec. 71.  Minnesota Statutes 2004, section 490.124, 
 31.29  subdivision 9, is amended to read: 
 31.30     Subd. 9.  [SURVIVORS' ANNUITY.] (a) Upon the death of a 
 31.31  judge prior to before retirement, or upon the death of a person 
 31.32  who has qualified for an annuity under this section but who 
 31.33  ceases to be a judge prior to before retirement and has who not 
 31.34  received a refund of contributions pursuant to under subdivision 
 31.35  12, a surviving spouse is entitled to, or, if there be no 
 31.36  surviving spouse, dependent children, shall are entitled to 
 32.1   receive an annuity, payable monthly, equal in total to 60 
 32.2   percent of the normal retirement annuity which would have been 
 32.3   payable to the judge or former judge had the date of death been 
 32.4   the normal retirement date, provided that the. 
 32.5      (b) The annuity payable to a surviving spouse or to 
 32.6   dependent children shall receive an annuity is an amount of not 
 32.7   less than 25 percent of the judge's or the former judge's final 
 32.8   average compensation. 
 32.9      If a judge, whose surviving spouse was not entitled to 
 32.10  survivors benefits provided solely for judges under statutes in 
 32.11  effect prior to January 1, 1974, shall have died prior to 
 32.12  retirement on or after May 23, 1973 and before January 1, 1974, 
 32.13  a surviving spouse and dependent children, if any, shall be 
 32.14  entitled to survivors benefits as provided hereunder as if such 
 32.15  judge had died on January 1, 1974. 
 32.16     Sec. 72.  Minnesota Statutes 2004, section 490.124, 
 32.17  subdivision 10, is amended to read: 
 32.18     Subd. 10.  [PRIOR SURVIVORS' BENEFITS; LIMITATION.] (a) 
 32.19  Benefits provided pursuant to under Minnesota Statutes 2004, 
 32.20  section 490.102, subdivision 6, or 490.1091, for a surviving 
 32.21  spouse of a retired judge, payable after the death of the judge, 
 32.22  shall be are limited to: 
 32.23     (a) spouses of judges who have retired prior to before 
 32.24  January 1, 1974; and. 
 32.25     (b) spouses of judges in office on December 31, 1973 and 
 32.26  thereafter who elect to continue contributions pursuant to 
 32.27  section 490.102, subdivision 6 or 490.109.  The contributions 
 32.28  shall be in addition to contributions pursuant to section 
 32.29  490.123, and upon retirement the judge may not elect to receive 
 32.30  any optional annuity pursuant to subdivision 11 unless the judge 
 32.31  and the spouse shall waive any benefits pursuant to section 
 32.32  490.102, subdivision 6 or 490.1091. 
 32.33     No other judge in office on or after January 1, 1974, shall 
 32.34  be is required to contribute pursuant to under Minnesota 
 32.35  Statutes 2004, section 490.102, subdivision 6, or 490.109. 
 32.36     Sec. 73.  Minnesota Statutes 2004, section 490.124, 
 33.1   subdivision 11, is amended to read: 
 33.2      Subd. 11.  [LIMITATION ON SURVIVOR BENEFITS; OPTIONAL 
 33.3   ANNUITIES.] (a) No survivor or death benefits may be paid in 
 33.4   connection with the death of a judge who retires after December 
 33.5   31, 1973, except as otherwise provided in sections 490.121 to 
 33.6   490.132.  
 33.7      (b) Except as provided in subdivision 10, a judge may elect 
 33.8   to receive, instead of the normal retirement annuity, an 
 33.9   optional retirement annuity in the form of either (1) an annuity 
 33.10  payable for a period certain and for life after that period, (2) 
 33.11  a joint and survivor annuity without reinstatement in the event 
 33.12  of if the designated beneficiary predeceasing predeceases the 
 33.13  retired judge, or (3) a joint and survivor annuity with 
 33.14  reinstatement in the event of if the designated beneficiary 
 33.15  predeceasing predeceases the retired judge.  
 33.16     (c) An optional retirement annuity must be actuarially 
 33.17  equivalent to a single-life annuity with no term certain and 
 33.18  must be established by the board of directors of the Minnesota 
 33.19  State Retirement System.  In establishing these optional 
 33.20  retirement annuity forms, the board shall obtain the written 
 33.21  recommendation of the actuary retained by the Legislative 
 33.22  Commission on Pensions and Retirement under section 356.214.  
 33.23  The recommendations must be retained as a part of the permanent 
 33.24  records of the board. 
 33.25     Sec. 74.  Minnesota Statutes 2004, section 490.124, 
 33.26  subdivision 12, is amended to read: 
 33.27     Subd. 12.  [REFUND.] (a) A person who ceases to be a 
 33.28  judge but who does not qualify for a retirement annuity or other 
 33.29  benefit under section 490.121 is entitled to a refund in an 
 33.30  amount that is equal to all of the member's employee 
 33.31  contributions to the judges' retirement fund plus interest 
 33.32  computed under section 352.22, subdivision 2. 
 33.33     (b) A refund of contributions under paragraph (a) 
 33.34  terminates all service credits and all rights and benefits of 
 33.35  the judge and the judge's survivors under this chapter.  
 33.36     (c) A person who becomes a judge again after taking a 
 34.1   refund under paragraph (a) may reinstate the previously 
 34.2   terminated allowable service credits credit, rights, and 
 34.3   benefits by repaying the total amount of the previously received 
 34.4   refund.  The refund repayment must include interest on the total 
 34.5   amount previously received at an annual rate of 8.5 percent, 
 34.6   compounded annually, from the date on which the refund was 
 34.7   received until the date on which the refund is repaid. 
 34.8      Sec. 75.  Minnesota Statutes 2004, section 490.124, 
 34.9   subdivision 13, is amended to read: 
 34.10     Subd. 13.  [DEATH REFUND.] If a judge who has not received 
 34.11  other benefits under this chapter dies and there are no survivor 
 34.12  benefits payable under this chapter, a refund plus interest as 
 34.13  provided in subdivision 12 is payable to the last designated 
 34.14  beneficiary named on a form filed with the director before the 
 34.15  death of the judge, or, if no designation is on file, the refund 
 34.16  is payable to the estate of the deceased judge. 
 34.17     Sec. 76.  Minnesota Statutes 2004, section 490.125, 
 34.18  subdivision 1, is amended to read: 
 34.19     Subdivision 1.  [MANDATORY RETIREMENT AGE.] Except as 
 34.20  otherwise provided in sections 490.121 to 490.132, each a judge 
 34.21  shall retire terminate active service as a judge on the judge's 
 34.22  mandatory retirement date.  
 34.23     Sec. 77.  Minnesota Statutes 2004, section 490.125, 
 34.24  subdivision 2, is amended to read: 
 34.25     Subd. 2.  [EXCEPTION.] Except as provided by sections 
 34.26  490.025, subdivision 3, 490.102, subdivisions 3 and 3a and 
 34.27  490.12, subdivision 2, Any judge in office on December 31, 1973 
 34.28  who shall have attained 70 years of age on or prior to such date 
 34.29  shall retire upon the expiration of the term of office of such 
 34.30  judge.  
 34.31     Sec. 78.  Minnesota Statutes 2004, section 490.126, is 
 34.32  amended to read: 
 34.33     490.126 [PROCEDURES.] 
 34.34     Subdivision 1.  [COMPULSORY RETIREMENT.] Proceedings for 
 34.35  compulsory retirement of a judge, if necessary, shall must be 
 34.36  conducted in accordance with rules issued by the Supreme Court 
 35.1   pursuant to under section 490.16 490A.02. 
 35.2      Subd. 2.  [VACANCIES.] Any judge may make written 
 35.3   application to the governor for retirement.  The governor 
 35.4   thereupon shall direct the judge's retirement by written order 
 35.5   which, when filed in the Office of the Secretary of State, shall 
 35.6   effect effects a vacancy in the office to be filled as provided 
 35.7   by law.  
 35.8      Subd. 3.  [APPLICATION FOR ANNUITY OR REFUND.] An 
 35.9   application for an annuity or a refund under sections 490.121 to 
 35.10  490.132 may be made by the potential annuitant or by someone 
 35.11  authorized to act for the potential annuitant.  Every 
 35.12  application for an annuity or refund, with accompanied by a 
 35.13  proof of age and by a record of years of service when 
 35.14  required, shall must be submitted to the governing 
 35.15  body executive director of the Minnesota State Retirement System 
 35.16  in a form prescribed by it the director.  
 35.17     Subd. 4.  [MANNER OF PAYMENT.] Unless otherwise 
 35.18  specifically provided by statute or agreed upon by the annuitant 
 35.19  and the governing body board of directors of the Minnesota State 
 35.20  Retirement System, annuities payable under sections 490.121 to 
 35.21  490.132 shall must be paid in the manner and at the intervals as 
 35.22  prescribed by the executive director of the Minnesota State 
 35.23  Retirement System.  The annuity shall cease ceases with the last 
 35.24  payment received by the annuitant while living.  
 35.25     Subd. 5.  [EXEMPTION FROM PROCESS; NO ASSIGNMENT.] None of 
 35.26  the money, annuities, or other benefits provided in this chapter 
 35.27  is assignable either in law or equity or is subject to state 
 35.28  estate tax, or to execution, levy, attachment, garnishment, or 
 35.29  other legal process, except as provided in section 518.58, 
 35.30  518.581, or 518.6111. 
 35.31     Sec. 79.  Minnesota Statutes 2004, section 490.133, is 
 35.32  amended to read: 
 35.33     490.133 [RETIREMENT; TRANSITION PROVISIONS; TRANSFER TO 
 35.34  COURT OF APPEALS.] 
 35.35     (a) If a judge to whom or to whose survivors benefits would 
 35.36  be payable under Minnesota Statutes 2004, sections 490.101 to 
 36.1   490.12, is elected or appointed to the Court of Appeals, that 
 36.2   judge and the judge's survivors, shall continue to be eligible 
 36.3   for benefits under those sections and not under sections 490.121 
 36.4   to 490.132.  
 36.5      (b) In that the case of a judge to whom paragraph (a) 
 36.6   applies, the service of the judge in the Court of Appeals shall 
 36.7   must be added to the prior service as district judge, probate 
 36.8   judge, or judge of any other court of record in determining 
 36.9   eligibility and the compensation of a judge of the Court of 
 36.10  Appeals at the time of the judge's death, disability, or 
 36.11  retirement shall be is the "compensation allotted to the office" 
 36.12  for the purposes of calculating benefit amounts.  
 36.13     (c) All other judges of the Court of Appeals and their 
 36.14  survivors shall be are subject to the retirement and survivor's 
 36.15  annuity provisions of sections 490.121 to 490.132. 
 36.16     Sec. 80.  [490A.01] [BOARD OF JUDICIAL STANDARDS; 
 36.17  ESTABLISHMENT.] 
 36.18     Subdivision 1.  [ESTABLISHMENT; COMPOSITION.] The Board on 
 36.19  Judicial Standards is established.  The Board on Judicial 
 36.20  Standards is a continuation of the board established by Laws 
 36.21  1971, chapter 909, sections 1 and 2, as amended.  For the 
 36.22  purposes of this chapter, "board" means the Board on Judicial 
 36.23  Standards. 
 36.24     Subd. 2.  [COMPOSITION; APPOINTMENT.] (a) The board 
 36.25  consists of one judge of the Court of Appeals, three trial court 
 36.26  judges, two lawyers who have practiced law in the state for at 
 36.27  least ten years, and four citizens who are not judges, retired 
 36.28  judges, or lawyers. 
 36.29     (b) All members must be appointed by the governor with the 
 36.30  advice and consent of the senate.  Senate confirmation is not 
 36.31  required for judicial members. 
 36.32     Subd. 3.  [TERM MAXIMUM; MEMBERSHIP TERMINATION.] No member 
 36.33  may serve more than two full four-year terms or their equivalent.
 36.34  Membership terminates if a member ceases to hold the position 
 36.35  that qualified the member for appointment. 
 36.36     Subd. 4.  [MEMBER TERMS; COMPENSATION; REMOVAL.] The 
 37.1   membership terms, compensation, removal of members, and filling 
 37.2   of vacancies on the board are as provided in section 15.0575. 
 37.3      Subd. 5.  [EXECUTIVE SECRETARY APPOINTMENT; SALARY.] (a) 
 37.4   The board shall appoint the executive secretary. 
 37.5      (b) The salary of the executive secretary of the board is 
 37.6   85 percent of the maximum salary provided for an administrative 
 37.7   law judge under section 15A.083, subdivision 6a. 
 37.8      Sec. 81.  [490A.02] [JUDICIAL STANDARDS BOARD; POWERS.] 
 37.9      Subdivision 1.  [JUDICIAL DISQUALIFICATION.] A judge is 
 37.10  disqualified from acting as a judge, without a loss of salary, 
 37.11  while there is pending an indictment or any information charging 
 37.12  the judge with a crime that is punishable as a felony under 
 37.13  either Minnesota law or federal law, or while there is pending a 
 37.14  recommendation to the Supreme Court by the Board on Judicial 
 37.15  Standards for the judge's removal or retirement. 
 37.16     Subd. 2.  [JUDICIAL SUSPENSION.] On receipt of a 
 37.17  recommendation of the Board on Judicial Standards or on its own 
 37.18  motion, the Supreme Court may suspend a judge from office 
 37.19  without salary when the judge pleads guilty to or no contest to 
 37.20  or is found guilty of a crime that is punishable as a felony 
 37.21  under either Minnesota law or federal law or any other crime 
 37.22  that involves moral turpitude.  If the conviction is reversed, 
 37.23  the suspension terminates and the judge must be paid a salary 
 37.24  for the period of suspension.  If the judge is suspended and the 
 37.25  conviction becomes final, the Supreme Court shall remove the 
 37.26  judge from office. 
 37.27     Subd. 3.  [JUDICIAL DISABILITY.] On receipt of a 
 37.28  recommendation of the Board on Judicial Standards, the Supreme 
 37.29  Court may retire a judge for a disability that the court 
 37.30  determines seriously interferes with the performance of the 
 37.31  judge's duties and is or is likely to become permanent, and 
 37.32  censure or remove a judge for an action or inaction that may 
 37.33  constitute persistent failure to perform the judge's duties, 
 37.34  incompetence in performing the judge's duties, habitual 
 37.35  intemperance, or conduct prejudicial to the administration of 
 37.36  justice that brings the judicial office into disrepute. 
 38.1      Subd. 4.  [AUTHORITY TO REOPEN MATTERS.] The board is 
 38.2   specifically empowered to reopen any matter wherein any 
 38.3   information or evidence was previously precluded by a statute of 
 38.4   limitations or by a previously existing provision of time 
 38.5   limitation. 
 38.6      Subd. 5.  [RETIREMENT STATUS.] (a) A judge who is retired 
 38.7   by the Supreme Court must be considered to have retired 
 38.8   voluntarily. 
 38.9      (b) This section and section 490A.01 must not affect the 
 38.10  right of a judge who is suspended, retired, or removed under 
 38.11  this section from qualifying for any pension or other retirement 
 38.12  benefits to which the judge would otherwise be entitled by law 
 38.13  to receive. 
 38.14     Subd. 6.  [ELIGIBILITY FOR JUDICIAL OFFICE; PRACTICE 
 38.15  LAW.] A judge removed by the Supreme Court is ineligible for any 
 38.16  future service in a judicial office.  The question of the right 
 38.17  of a removed judge to practice law in this state must be 
 38.18  referred to the proper authority for review. 
 38.19     Subd. 7.  [SUPREME COURT RULES.] The Supreme Court shall 
 38.20  make rules to implement this section. 
 38.21     Sec. 82.  [490A.03] [PERSONS AFFECTED.] 
 38.22     The provisions of sections 490A.01 and 490A.02 apply to all 
 38.23  judges, judicial officers, and referees.  
 38.24     Sec. 83.  Minnesota Statutes 2004, section 525.05, is 
 38.25  amended to read: 
 38.26     525.05 [JUDGE OR REFEREE; GROUNDS FOR DISQUALIFICATION.] 
 38.27     The following shall be grounds for disqualification of any 
 38.28  judge or referee from acting in any matter:  (1) That the judge 
 38.29  or the judge's spouse or any of either of their kin nearer than 
 38.30  first cousin is interested as representative, heir, devisee, 
 38.31  legatee, ward, or creditor in the estate involved therein; (2) 
 38.32  that it involves the validity or interpretation of a will drawn 
 38.33  or witnessed by the judge; (3) that the judge may be a necessary 
 38.34  witness in the matter; (4) that it involves a property right in 
 38.35  respect to which the judge has been engaged or is engaged as an 
 38.36  attorney; or (5) that the judge was engaged in a joint 
 39.1   enterprise for profit with the decedent at the time of death or 
 39.2   that the judge is then engaged in a joint enterprise for profit 
 39.3   with any person interested in the matter as representative, 
 39.4   heir, devisee, legatee, ward, or creditor.  When grounds for 
 39.5   disqualification exist, the judge may, and upon proper petition 
 39.6   of any person interested in the estate must, request another 
 39.7   judge or a judge who has retired as provided in section 490.12, 
 39.8   subdivision 2, to act in the judge's stead in the matter. 
 39.9      Sec. 84.  [REPEALER; EFFECT ON BENEFIT COVERAGE.] 
 39.10     Subdivision 1.  [LEGISLATORS RETIREMENT PLAN; REPEALED AS 
 39.11  OBSOLETE.] Minnesota Statutes 2004, sections 3A.01, subdivisions 
 39.12  3, 4, 6a, and 7; 3A.02, subdivision 2; 3A.04, subdivision 1a; 
 39.13  and 3A.09, are repealed. 
 39.14     Subd. 2.  [ELECTIVE STATE OFFICERS RETIREMENT PLAN; 
 39.15  REPEALED AS OBSOLETE.] Minnesota Statutes 2004, sections 
 39.16  352C.01; 352C.011; 352C.021; 352C.031; 352C.033; 352C.04; 
 39.17  352C.051; 352C.09; and 352C.091, subdivisions 2 and 3, are 
 39.18  repealed. 
 39.19     Subd. 3.  [JUDICIAL RETIREMENT PLANS; REPEALED AS 
 39.20  OBSOLETE.] Minnesota Statutes 2004, sections 490.021; 490.025; 
 39.21  490.101; 490.102; 490.103; 490.105; 490.106; 490.107; 490.108; 
 39.22  490.109; 490.1091; 490.12; 490.121, subdivisions 2, 3, 5, 8, 9, 
 39.23  10, 11, 12, 16, 17, 18, 19, and 20; 490.124, subdivision 6; and 
 39.24  490.132, are repealed. 
 39.25     Subd. 4.  [JUDICIAL STANDARDS BOARD; REPEALED FOR 
 39.26  RELOCATION AS MINNESOTA STATUTES, CHAPTER 490A.] Minnesota 
 39.27  Statutes 2004, sections 490.15, 490.16, and 490.18, are repealed.
 39.28     Subd. 5.  [UNIFORM JUDICIAL RETIREMENT PLAN; NO BENEFIT 
 39.29  DIMINISHMENT INTENDED; PROCEDURE.] Sections 32 to 76 are not 
 39.30  intended to reduce or increase the entitlement of active, 
 39.31  deferred, or retired judges to retirement annuities or benefits 
 39.32  as of July 1, 2005, as reflected in the records of the Minnesota 
 39.33  State Retirement System.  If the executive director of the 
 39.34  Minnesota State Retirement System determines that any provisions 
 39.35  of sections 32 to 76 functions to modify, impair, or diminish 
 39.36  the retirement annuity or benefit entitlement of any judge that 
 40.1   had accrued or earned before July 1, 2005, the executive 
 40.2   director shall certify that determination and a recommendation 
 40.3   as to the required legislative correction to the chair of the 
 40.4   Legislative Commission on Pensions and Retirement, the chair of 
 40.5   the senate State and Local Governmental Operations Committee, 
 40.6   the chair of the house Governmental Operations and Veterans 
 40.7   Affairs Policy Committee, and the executive director of the 
 40.8   Legislative Commission on Pensions and Retirement on or before 
 40.9   the October 1 next following that determination. 
 40.10     Sec. 85.  [REVISOR INSTRUCTIONS.] 
 40.11     (a) In Minnesota Statutes, chapters 352, 352D, 355, 356, 
 40.12  and 487, the revisor of statutes shall change references to 
 40.13  "sections 490.121 to 490.132" to "chapter 490".  
 40.14     (b) In Minnesota Statutes, chapter 490, the revisor of 
 40.15  statutes shall change references to "sections 490.121 to 
 40.16  490.132" to "this chapter".  
 40.17     (c) In Minnesota Statutes, sections 175A.01, subdivision 4, 
 40.18  and 271.01, subdivision 1, the revisor of statutes shall change 
 40.19  references to "sections 490.15 and 490.16" to "sections 490A.01 
 40.20  and 490A.02". 
 40.21     Sec. 86.  [EFFECTIVE DATE.] 
 40.22     This article is effective on July 1, 2005. 
 40.23                             ARTICLE 2
 40.24                   COVERED SALARY; AVERAGE SALARY
 40.25     Section 1.  Minnesota Statutes 2004, section 352.01, is 
 40.26  amended by adding a subdivision to read: 
 40.27     Subd. 14a.  [AVERAGE SALARY.] (a) "Average salary" means 
 40.28  the average of the highest five successive years of salary upon 
 40.29  which the employee has made contributions to the retirement fund 
 40.30  by payroll deductions.  Average salary must be based upon all 
 40.31  allowable service if this service is less than five years. 
 40.32     (b) "Average salary" does not include the payment of 
 40.33  accrued unused annual leave or overtime paid at time of final 
 40.34  separation from state service if paid in a lump sum nor does it 
 40.35  include the reduced salary, if any, paid during the period the 
 40.36  employee is entitled to workers' compensation benefit payments 
 41.1   for temporary disability. 
 41.2      (c) For an employee covered by the correctional state 
 41.3   employees retirement plan, "average salary" means the average of 
 41.4   the monthly salary during the employee's highest five successive 
 41.5   years of salary as an employee covered by the general state 
 41.6   employees retirement plan, or the correctional state employees 
 41.7   retirement plan, or by a combination of the two.  If the total 
 41.8   of the covered service is less than five years, the 
 41.9   determination of average salary must be based on all allowable 
 41.10  service.  
 41.11     Sec. 2.  Minnesota Statutes 2004, section 352.115, 
 41.12  subdivision 2, is amended to read: 
 41.13     Subd. 2.  [AVERAGE SALARY NORMAL RETIREMENT ANNUITY.] The 
 41.14  retirement annuity hereunder payable at normal retirement age or 
 41.15  thereafter must be computed in accordance with the applicable 
 41.16  provisions of the formula stated in subdivision 3, on the basis 
 41.17  of the employee's average salary for the period of allowable 
 41.18  service.  This retirement annuity is known as the "normal" 
 41.19  retirement annuity.  
 41.20     For each year of allowable service, "average salary" of an 
 41.21  employee in determining a retirement annuity means the average 
 41.22  of the highest five successive years of salary upon which the 
 41.23  employee has made contributions to the retirement fund by 
 41.24  payroll deductions.  Average salary must be based upon all 
 41.25  allowable service if this service is less than five years. 
 41.26     "Average salary" does not include the payment of accrued 
 41.27  unused annual leave or overtime paid at time of final separation 
 41.28  from state service if paid in a lump sum nor does it include the 
 41.29  reduced salary, if any, paid during the period the employee is 
 41.30  entitled to workers' compensation benefit payments for temporary 
 41.31  disability. 
 41.32     Sec. 3.  Minnesota Statutes 2004, section 352.115, 
 41.33  subdivision 3, is amended to read: 
 41.34     Subd. 3.  [RETIREMENT ANNUITY FORMULA.] (a) This paragraph, 
 41.35  in conjunction with section 352.116, subdivision 1, applies to a 
 41.36  person who became a covered employee or a member of a pension 
 42.1   fund listed in section 356.30, subdivision 3, before July 1, 
 42.2   1989, unless paragraph (b), in conjunction with section 352.116, 
 42.3   subdivision 1a, produces a higher annuity amount, in which case 
 42.4   paragraph (b) will apply.  The employee's average salary, as 
 42.5   defined in section 352.01, subdivision 2 14a, multiplied by the 
 42.6   percent specified in section 356.315, subdivision 1, per year of 
 42.7   allowable service for the first ten years and the percent 
 42.8   specified in section 356.315, subdivision 2, for each later year 
 42.9   of allowable service and pro rata for completed months less than 
 42.10  a full year shall determine the amount of the retirement annuity 
 42.11  to which the employee is entitled. 
 42.12     (b) This paragraph applies to a person who has become at 
 42.13  least 55 years old and first became a covered employee after 
 42.14  June 30, 1989, and to any other covered employee who has become 
 42.15  at least 55 years old and whose annuity amount, when calculated 
 42.16  under this paragraph and in conjunction with section 352.116, 
 42.17  subdivision 1a, is higher than it is when calculated under 
 42.18  paragraph (a), in conjunction with section 352.116, subdivision 
 42.19  1.  The employee's average salary, as defined in section 352.01, 
 42.20  subdivision 2 14a, multiplied by the percent specified in 
 42.21  section 356.315, subdivision 2, for each year of allowable 
 42.22  service and pro rata for months less than a full year shall 
 42.23  determine the amount of the retirement annuity to which the 
 42.24  employee is entitled. 
 42.25     Sec. 4.  Minnesota Statutes 2004, section 352.87, 
 42.26  subdivision 3, is amended to read: 
 42.27     Subd. 3.  [RETIREMENT ANNUITY FORMULA.] A person specified 
 42.28  in subdivision 1 will have is entitled to receive a retirement 
 42.29  annuity applicable for allowable service credit under this 
 42.30  section calculated by multiplying the employee's average salary, 
 42.31  as defined in section 352.115 352.01, subdivision 2 14a, by the 
 42.32  percent specified in section 356.315, subdivision 2a, for each 
 42.33  year or portions of a year of allowable service credit.  No 
 42.34  reduction for retirement prior to before the normal retirement 
 42.35  age, as specified in section 352.01, subdivision 25, applies to 
 42.36  service to which this section applies. 
 43.1      Sec. 5.  Minnesota Statutes 2004, section 352.93, 
 43.2   subdivision 1, is amended to read: 
 43.3      Subdivision 1.  [BASIS OF ANNUITY; WHEN TO APPLY.] After 
 43.4   separation from state service, an employee covered under section 
 43.5   352.91 who has reached age 55 years and has credit for at least 
 43.6   three years of covered correctional service or a combination of 
 43.7   covered correctional service and regular Minnesota general 
 43.8   employees state retirement System plan service is entitled upon 
 43.9   application to a retirement annuity under this section, based 
 43.10  only on covered correctional employees' service.  Application 
 43.11  may be made no earlier than 60 days before the date the employee 
 43.12  is eligible to retire by reason of both age and service 
 43.13  requirements.  
 43.14     In this section, "average salary" means the average of the 
 43.15  monthly salary during the employee's highest five successive 
 43.16  years of salary as an employee covered by the Minnesota State 
 43.17  Retirement System.  Average salary must be based upon all 
 43.18  allowable service if this service is less than five years. 
 43.19     Sec. 6.  Minnesota Statutes 2004, section 352C.021, is 
 43.20  amended by adding a subdivision to read: 
 43.21     Subd. 1a.  [AVERAGE SALARY.] "Average salary," for purposes 
 43.22  of calculating the normal retirement annuity under section 
 43.23  352C.031, subdivision 4, means the average of the highest five 
 43.24  successive years of salary upon which contributions have been 
 43.25  made under section 352C.09.  
 43.26     Sec. 7.  Minnesota Statutes 2004, section 353.01, 
 43.27  subdivision 10, is amended to read: 
 43.28     Subd. 10.  [SALARY.] (a) "Salary" means: 
 43.29     (1) the periodic compensation of a public employee, before 
 43.30  deductions for deferred compensation, supplemental retirement 
 43.31  plans, or other voluntary salary reduction programs, and also 
 43.32  means "wages" and includes net income from fees; 
 43.33     (2) for a public employee who is covered by a supplemental 
 43.34  retirement plan under section 356.24, subdivision 1, clause (8), 
 43.35  (9), or (10), which require all plan contributions be made by 
 43.36  the employer, the contribution to the applicable supplemental 
 44.1   retirement plan when the contribution is from mandatory 
 44.2   withholdings from employees' wages; and 
 44.3      (2) (3) for a public employee who has prior service covered 
 44.4   by a local police or firefighters relief association that has 
 44.5   consolidated with the Public Employees Retirement Association or 
 44.6   to which section 353.665 applies and who has elected coverage 
 44.7   either under the public employees police and fire fund benefit 
 44.8   plan under section 353A.08 following the consolidation or under 
 44.9   section 353.665, subdivision 4, the rate of salary upon which 
 44.10  member contributions to the special fund of the relief 
 44.11  association were made prior to the effective date of the 
 44.12  consolidation as specified by law and by bylaw provisions 
 44.13  governing the relief association on the date of the initiation 
 44.14  of the consolidation procedure and the actual periodic 
 44.15  compensation of the public employee after the effective date of 
 44.16  consolidation. 
 44.17     (b) Salary does not mean: 
 44.18     (1) the fees paid to district court reporters, unused 
 44.19  annual vacation or sick leave payments, in lump-sum or periodic 
 44.20  payments, severance payments, reimbursement of expenses, 
 44.21  lump-sum settlements not attached to a specific earnings period, 
 44.22  or workers' compensation payments; 
 44.23     (2) employer-paid amounts used by an employee toward the 
 44.24  cost of insurance coverage, employer-paid fringe benefits, 
 44.25  flexible spending accounts, cafeteria plans, health care expense 
 44.26  accounts, day care expenses, or any payments in lieu of any 
 44.27  employer-paid group insurance coverage, including the difference 
 44.28  between single and family rates that may be paid to a member 
 44.29  with single coverage and certain amounts determined by the 
 44.30  executive director to be ineligible; 
 44.31     (3) the amount equal to that which the employing 
 44.32  governmental subdivision would otherwise pay toward single or 
 44.33  family insurance coverage for a covered employee when, through a 
 44.34  contract or agreement with some but not all employees, the 
 44.35  employer: 
 44.36     (i) discontinues, or for new hires does not provide, 
 45.1   payment toward the cost of the employee's selected insurance 
 45.2   coverages under a group plan offered by the employer; 
 45.3      (ii) makes the employee solely responsible for all 
 45.4   contributions toward the cost of the employee's selected 
 45.5   insurance coverages under a group plan offered by the employer, 
 45.6   including any amount the employer makes toward other employees' 
 45.7   selected insurance coverages under a group plan offered by the 
 45.8   employer; and 
 45.9      (iii) provides increased salary rates for employees who do 
 45.10  not have any employer-paid group insurance coverages; 
 45.11     (4) except as provided in section 353.86 or 353.87, 
 45.12  compensation of any kind paid to volunteer ambulance service 
 45.13  personnel or volunteer firefighters, as defined in subdivision 
 45.14  35 or 36; and 
 45.15     (5) the amount of compensation that exceeds the limitation 
 45.16  provided in section 356.611.  
 45.17     (c) Amounts provided to an employee by the employer through 
 45.18  a grievance proceeding or a legal settlement are salary only if 
 45.19  the settlement is reviewed by the executive director and the 
 45.20  amounts are determined by the executive director to be 
 45.21  consistent with paragraph (a) and prior determinations. 
 45.22     Sec. 8.  Minnesota Statutes 2004, section 353.01, is 
 45.23  amended by adding a subdivision to read: 
 45.24     Subd. 17a.  [AVERAGE SALARY.] (a) "Average salary," for 
 45.25  purposes of calculating a retirement annuity under section 
 45.26  353.29, subdivision 3, means an amount equivalent to the average 
 45.27  of the highest salary of the member, police officer, or 
 45.28  firefighter, whichever applies, upon which employee 
 45.29  contributions were paid for any five successive years of 
 45.30  allowable service, based on dates of salary periods as listed on 
 45.31  salary deduction reports.  Average salary must be based upon all 
 45.32  allowable service if this service is less than five years.  
 45.33     (b) "Average salary" may not include any reduced salary 
 45.34  paid during a period in which the employee is entitled to 
 45.35  benefit payments from workers' compensation for temporary 
 45.36  disability, unless the average salary is higher, including this 
 46.1   period. 
 46.2      Sec. 9.  Minnesota Statutes 2004, section 353.29, 
 46.3   subdivision 3, is amended to read: 
 46.4      Subd. 3.  [RETIREMENT ANNUITY FORMULA.] (a) This paragraph, 
 46.5   in conjunction with section 353.30, subdivisions 1, 1a, 1b, and 
 46.6   1c, applies to any member who first became a public employee or 
 46.7   a member of a pension fund listed in section 356.30, subdivision 
 46.8   3, before July 1, 1989, unless paragraph (b), in conjunction 
 46.9   with section 353.30, subdivision 5, produces a higher annuity 
 46.10  amount, in which case paragraph (b) will apply.  The average 
 46.11  salary as defined in section 353.01, subdivision 2 17a, 
 46.12  multiplied by the percent specified in section 356.315, 
 46.13  subdivision 3, for each year of allowable service for the first 
 46.14  ten years and thereafter by the percent specified in section 
 46.15  356.315, subdivision 4, per year of allowable service and 
 46.16  completed months less than a full year for the "basic member," 
 46.17  and the percent specified in section 356.315, subdivision 1, for 
 46.18  each year of allowable service for the first ten years and 
 46.19  thereafter by the percent specified in section 356.315, 
 46.20  subdivision 2, per year of allowable service and completed 
 46.21  months less than a full year for the "coordinated member," shall 
 46.22  determine the amount of the "normal" retirement annuity. 
 46.23     (b) This paragraph applies to a member who has become at 
 46.24  least 55 years old and first became a public employee after June 
 46.25  30, 1989, and to any other member whose annuity amount, when 
 46.26  calculated under this paragraph and in conjunction with section 
 46.27  353.30, subdivision 5, is higher than it is when calculated 
 46.28  under paragraph (a), in conjunction with section 353.30, 
 46.29  subdivisions 1, 1a, 1b, and 1c.  The average salary, as defined 
 46.30  in section 353.01, subdivision 2 17a, multiplied by the percent 
 46.31  specified in section 356.315, subdivision 4, for each year of 
 46.32  allowable service and completed months less than a full year for 
 46.33  a basic member and the percent specified in section 356.315, 
 46.34  subdivision 2, per year of allowable service and completed 
 46.35  months less than a full year for a coordinated member, shall 
 46.36  determine the amount of the normal retirement annuity. 
 47.1      Sec. 10.  Minnesota Statutes 2004, section 353.33, 
 47.2   subdivision 3, is amended to read: 
 47.3      Subd. 3.  [COMPUTATION OF BENEFITS.] This disability 
 47.4   benefit is an amount equal to the normal annuity payable to a 
 47.5   member who has reached normal retirement age with the same 
 47.6   number of years of allowable service and the same average 
 47.7   salary, as provided in section 353.01, subdivision 17a, and 
 47.8   section 353.29, subdivisions 2 and subdivision 3. 
 47.9      A basic member shall receive a supplementary monthly 
 47.10  benefit of $25 to age 65 or the five-year anniversary of the 
 47.11  effective date of the disability benefit, whichever is later. 
 47.12     If the disability benefits under this subdivision exceed 
 47.13  the average salary as defined in section 353.29 353.01, 
 47.14  subdivision 2 17a, the disability benefits must be reduced to an 
 47.15  amount equal to said the average salary. 
 47.16     Sec. 11.  Minnesota Statutes 2004, section 353.651, 
 47.17  subdivision 3, is amended to read: 
 47.18     Subd. 3.  [RETIREMENT ANNUITY FORMULA.] The average salary 
 47.19  as defined in section 353.01, subdivision 2 17a, multiplied by 
 47.20  the percent specified in section 356.315, subdivision 6, per 
 47.21  year of allowable service determines the amount of the normal 
 47.22  retirement annuity.  If the member has earned allowable service 
 47.23  for performing services other than those of a police officer or 
 47.24  firefighter, the annuity representing such that service is must 
 47.25  be computed under sections 353.29 and 353.30. 
 47.26     Sec. 12.  Minnesota Statutes 2004, section 353.656, 
 47.27  subdivision 1, is amended to read: 
 47.28     Subdivision 1.  [IN LINE OF DUTY; COMPUTATION OF BENEFITS.] 
 47.29  A member of the police and fire plan who becomes disabled and 
 47.30  physically unfit to perform duties as a police officer, 
 47.31  firefighter, or paramedic as defined under section 353.64, 
 47.32  subdivision 10, as a direct result of an injury, sickness, or 
 47.33  other disability incurred in or arising out of any act of duty, 
 47.34  which has or is expected to render the member physically or 
 47.35  mentally unable to perform the duties as a police officer, 
 47.36  firefighter, or paramedic as defined under section 353.64, 
 48.1   subdivision 10, for a period of at least one year, shall receive 
 48.2   disability benefits during the period of such disability.  The 
 48.3   benefits must be in an amount equal to 60 percent of the 
 48.4   "average salary" as defined in section 353.651 353.01, 
 48.5   subdivision 2 17a, plus an additional percent specified in 
 48.6   section 356.315, subdivision 6, of that average salary for each 
 48.7   year of service in excess of 20 years.  If the disability under 
 48.8   this subdivision occurs before the member has at least five 
 48.9   years of allowable service credit in the police and fire plan, 
 48.10  the disability benefit must be computed on the "average salary" 
 48.11  from which deductions were made for contribution to the police 
 48.12  and fire fund. 
 48.13     Sec. 13.  Minnesota Statutes 2004, section 354.05, is 
 48.14  amended by adding a subdivision to read: 
 48.15     Subd. 13a.  [AVERAGE SALARY.] (a) "Average salary," for the 
 48.16  purpose of determining the member's retirement annuity, means 
 48.17  the average salary upon which contributions were made for the 
 48.18  highest five successive years of formula service credit.  
 48.19     (b) "Average salary" may not include any more than the 
 48.20  equivalent of 60 monthly salary payments.  
 48.21     (c) "Average salary" must be based upon all years of 
 48.22  formula service credit if this service credit is less than five 
 48.23  years.  
 48.24     Sec. 14.  Minnesota Statutes 2004, section 354.44, 
 48.25  subdivision 6, is amended to read: 
 48.26     Subd. 6.  [COMPUTATION OF FORMULA PROGRAM RETIREMENT 
 48.27  ANNUITY.] (a) The formula retirement annuity must be computed in 
 48.28  accordance with the applicable provisions of the formulas stated 
 48.29  in paragraph (b) or (d) on the basis of each member's average 
 48.30  salary under section 354.05, subdivision 13a, for the period of 
 48.31  the member's formula service credit.  
 48.32     For all years of formula service credit, "average salary," 
 48.33  for the purpose of determining the member's retirement annuity, 
 48.34  means the average salary upon which contributions were made and 
 48.35  upon which payments were made to increase the salary limitation 
 48.36  provided in Minnesota Statutes 1971, section 354.511, for the 
 49.1   highest five successive years of formula service credit 
 49.2   provided, however, that such "average salary" shall not include 
 49.3   any more than the equivalent of 60 monthly salary payments.  
 49.4   Average salary must be based upon all years of formula service 
 49.5   credit if this service credit is less than five years. 
 49.6      (b) This paragraph, in conjunction with paragraph (c), 
 49.7   applies to a person who first became a member of the association 
 49.8   or a member of a pension fund listed in section 356.30, 
 49.9   subdivision 3, before July 1, 1989, unless paragraph (d), in 
 49.10  conjunction with paragraph (e), produces a higher annuity 
 49.11  amount, in which case paragraph (d) applies.  The average salary 
 49.12  as defined in paragraph (a) section 354.05, subdivision 13a, 
 49.13  multiplied by the following percentages per year of formula 
 49.14  service credit shall determine the amount of the annuity to 
 49.15  which the member qualifying therefor is entitled: 
 49.16                         Coordinated Member   Basic Member
 49.17  Each year of service     the percent        the percent
 49.18  during first ten         specified in       specified in
 49.19                           section 356.315,   section 356.315,
 49.20                           subdivision 1,     subdivision 3,
 49.21                           per year           per year
 49.22  Each year of service     the percent        the percent
 49.23  thereafter               specified in       specified in
 49.24                           section 356.315,   section 356.315,
 49.25                           subdivision 2,     subdivision 4,
 49.26                           per year           per year
 49.27     (c)(i) This paragraph applies only to a person who first 
 49.28  became a member of the association or a member of a pension fund 
 49.29  listed in section 356.30, subdivision 3, before July 1, 1989, 
 49.30  and whose annuity is higher when calculated under paragraph (b), 
 49.31  in conjunction with this paragraph than when calculated under 
 49.32  paragraph (d), in conjunction with paragraph (e). 
 49.33     (ii) Where any member retires prior to normal retirement 
 49.34  age under a formula annuity, the member shall be paid a 
 49.35  retirement annuity in an amount equal to the normal annuity 
 49.36  provided in paragraph (b) reduced by one-quarter of one percent 
 50.1   for each month that the member is under normal retirement age at 
 50.2   the time of retirement except that for any member who has 30 or 
 50.3   more years of allowable service credit, the reduction shall be 
 50.4   applied only for each month that the member is under age 62. 
 50.5      (iii) Any member whose attained age plus credited allowable 
 50.6   service totals 90 years is entitled, upon application, to a 
 50.7   retirement annuity in an amount equal to the normal annuity 
 50.8   provided in paragraph (b), without any reduction by reason of 
 50.9   early retirement. 
 50.10     (d) This paragraph applies to a member who has become at 
 50.11  least 55 years old and first became a member of the association 
 50.12  after June 30, 1989, and to any other member who has become at 
 50.13  least 55 years old and whose annuity amount when calculated 
 50.14  under this paragraph and in conjunction with paragraph (e), is 
 50.15  higher than it is when calculated under paragraph (b), in 
 50.16  conjunction with paragraph (c).  The average salary, as defined 
 50.17  in paragraph (a) section 354.05, subdivision 13a, multiplied by 
 50.18  the percent specified by section 356.315, subdivision 4, for 
 50.19  each year of service for a basic member and by the percent 
 50.20  specified in section 356.315, subdivision 2, for each year of 
 50.21  service for a coordinated member shall determine the amount of 
 50.22  the retirement annuity to which the member is entitled. 
 50.23     (e) This paragraph applies to a person who has become at 
 50.24  least 55 years old and first becomes a member of the association 
 50.25  after June 30, 1989, and to any other member who has become at 
 50.26  least 55 years old and whose annuity is higher when calculated 
 50.27  under paragraph (d) in conjunction with this paragraph than when 
 50.28  calculated under paragraph (b), in conjunction with paragraph 
 50.29  (c).  An employee who retires under the formula annuity before 
 50.30  the normal retirement age shall be paid the normal annuity 
 50.31  provided in paragraph (d) reduced so that the reduced annuity is 
 50.32  the actuarial equivalent of the annuity that would be payable to 
 50.33  the employee if the employee deferred receipt of the annuity and 
 50.34  the annuity amount were augmented at an annual rate of three 
 50.35  percent compounded annually from the day the annuity begins to 
 50.36  accrue until the normal retirement age. 
 51.1      (f) No retirement annuity is payable to a former employee 
 51.2   with a salary that exceeds 95 percent of the governor's salary 
 51.3   unless and until the salary figures used in computing the 
 51.4   highest five successive years average salary under paragraph (a) 
 51.5   have been audited by the Teachers Retirement Association and 
 51.6   determined by the executive director to comply with the 
 51.7   requirements and limitations of section 354.05, subdivisions 35 
 51.8   and 35a. 
 51.9      Sec. 15.  Minnesota Statutes 2004, section 354A.011, is 
 51.10  amended by adding a subdivision to read: 
 51.11     Subd. 7a.  [AVERAGE SALARY.] "Average salary," for purposes 
 51.12  of computing a normal coordinated program retirement annuity 
 51.13  under section 354A.31, subdivision 4 or 4a, means an amount 
 51.14  equal to the average salary upon which contributions were made 
 51.15  for the highest five successive years of service credit but may 
 51.16  not, in any event, include any more than the equivalent of 60 
 51.17  monthly salary payments.  Average salary must be based upon all 
 51.18  years of service credit if this service credit is less than five 
 51.19  years.  
 51.20     Sec. 16.  Minnesota Statutes 2004, section 354A.31, 
 51.21  subdivision 4, is amended to read: 
 51.22     Subd. 4.  [COMPUTATION OF THE NORMAL COORDINATED RETIREMENT 
 51.23  ANNUITY; MINNEAPOLIS AND ST. PAUL FUNDS.] (a) This subdivision 
 51.24  applies to the coordinated programs of the Minneapolis Teachers 
 51.25  Retirement Fund Association and the St. Paul Teachers Retirement 
 51.26  Fund Association.  
 51.27     (b) The normal coordinated retirement annuity shall be is 
 51.28  an amount equal to a retiring coordinated member's average 
 51.29  salary under section 354A.011, subdivision 7a, multiplied by the 
 51.30  retirement annuity formula percentage.  Average salary for 
 51.31  purposes of this section shall mean an amount equal to the 
 51.32  average salary upon which contributions were made for the 
 51.33  highest five successive years of service credit, but which shall 
 51.34  not in any event include any more than the equivalent of 60 
 51.35  monthly salary payments.  Average salary must be based upon all 
 51.36  years of service credit if this service credit is less than five 
 52.1   years. 
 52.2      (c) This paragraph, in conjunction with subdivision 6, 
 52.3   applies to a person who first became a member or a member in a 
 52.4   pension fund listed in section 356.30, subdivision 3, before 
 52.5   July 1, 1989, unless paragraph (d), in conjunction with 
 52.6   subdivision 7, produces a higher annuity amount, in which case 
 52.7   paragraph (d) will apply.  The retirement annuity formula 
 52.8   percentage for purposes of this paragraph is the percent 
 52.9   specified in section 356.315, subdivision 1, per year for each 
 52.10  year of coordinated service for the first ten years and the 
 52.11  percent specified in section 356.315, subdivision 2, for each 
 52.12  year of coordinated service thereafter.  
 52.13     (d) This paragraph applies to a person who has become at 
 52.14  least 55 years old and who first becomes a member after June 30, 
 52.15  1989, and to any other member who has become at least 55 years 
 52.16  old and whose annuity amount, when calculated under this 
 52.17  paragraph and in conjunction with subdivision 7 is higher than 
 52.18  it is when calculated under paragraph (c), in conjunction with 
 52.19  the provisions of subdivision 6.  The retirement annuity formula 
 52.20  percentage for purposes of this paragraph is the percent 
 52.21  specified in section 356.315, subdivision 2, for each year of 
 52.22  coordinated service.  
 52.23     Sec. 17.  Minnesota Statutes 2004, section 354A.31, 
 52.24  subdivision 4a, is amended to read: 
 52.25     Subd. 4a.  [COMPUTATION OF THE NORMAL COORDINATED 
 52.26  RETIREMENT ANNUITY; DULUTH FUND.] (a) This subdivision applies 
 52.27  to the new law coordinated program of the Duluth Teachers 
 52.28  Retirement Fund Association. 
 52.29     (b) The normal coordinated retirement annuity is an amount 
 52.30  equal to a retiring coordinated member's average salary under 
 52.31  section 354A.011, subdivision 7a, multiplied by the retirement 
 52.32  annuity formula percentage.  Average salary for purposes of this 
 52.33  section means an amount equal to the average salary upon which 
 52.34  contributions were made for the highest five successive years of 
 52.35  service credit, but may not in any event include any more than 
 52.36  the equivalent of 60 monthly salary payments.  Average salary 
 53.1   must be based upon all years of service credit if this service 
 53.2   credit is less than five years. 
 53.3      (c) This paragraph, in conjunction with subdivision 6, 
 53.4   applies to a person who first became a member or a member in a 
 53.5   pension fund listed in section 356.30, subdivision 3, before 
 53.6   July 1, 1989, unless paragraph (d), in conjunction with 
 53.7   subdivision 7, produces a higher annuity amount, in which case 
 53.8   paragraph (d) applies.  The retirement annuity formula 
 53.9   percentage for purposes of this paragraph is the percent 
 53.10  specified in section 356.315, subdivision 1, per year for each 
 53.11  year of coordinated service for the first ten years and the 
 53.12  percent specified in section 356.315, subdivision 2, for each 
 53.13  subsequent year of coordinated service. 
 53.14     (d) This paragraph applies to a person who is at least 55 
 53.15  years old and who first becomes a member after June 30, 1989, 
 53.16  and to any other member who is at least 55 years old and whose 
 53.17  annuity amount, when calculated under this paragraph and in 
 53.18  conjunction with subdivision 7, is higher than it is when 
 53.19  calculated under paragraph (c) in conjunction with subdivision 
 53.20  6.  The retirement annuity formula percentage for purposes of 
 53.21  this paragraph is the percent specified in section 356.315, 
 53.22  subdivision 2, for each year of coordinated service. 
 53.23     Sec. 18.  Minnesota Statutes 2004, section 422A.01, is 
 53.24  amended by adding a subdivision to read: 
 53.25     Subd. 4a.  [AVERAGE SALARY.] (a) "Average salary" means the 
 53.26  arithmetic average annual salary, wages, or compensation of the 
 53.27  member from the city for any five calendar years out of the last 
 53.28  ten calendar years of service, except as provided for in section 
 53.29  422A.16, which may include the year in which the employee 
 53.30  retires, as selected by the employee.  
 53.31     (b) A member with more than five calendar years of service, 
 53.32  but less than ten calendar years, may select any five calendar 
 53.33  years of service to determine the average salary.  A member with 
 53.34  less than five years of service with the city shall use all 
 53.35  earnings to determine the average salary.  
 53.36     Sec. 19.  Minnesota Statutes 2004, section 422A.15, 
 54.1   subdivision 1, is amended to read: 
 54.2      Subdivision 1.  [FORMULA PENSION AND ANNUITY.] Except as 
 54.3   otherwise provided in subdivision 3, each contributing member 
 54.4   who, at the time of retirement, fulfills the conditions 
 54.5   necessary to enable the member to retire, shall is entitled to 
 54.6   receive what shall be known as a "formula pension and annuity" 
 54.7   equal to two percent for each year of allowable service for the 
 54.8   first ten years and thereafter 2.5 percent per year of allowable 
 54.9   service of the arithmetic average annual salary, wages or 
 54.10  compensation of the member from the city for any five calendar 
 54.11  years out of the last ten calendar years of service except as 
 54.12  provided for in section 422A.16, which may include the year in 
 54.13  which the employee retires, as selected by the employee, 
 54.14  multiplied by the years of service credited by the retirement 
 54.15  fund.  The formula pension and annuity shall must be computed on 
 54.16  the single life plan but subject to the option selections 
 54.17  provided for in section 422A.17. 
 54.18     In order to be entitled to the formula pension and annuity 
 54.19  herein provided for, the retiring employee at the time of 
 54.20  cessation of employment and of actual retirement shall must have 
 54.21  attained the age of 60 years or have been employed by the city 
 54.22  not less than 30 years, or meet the qualifications provided for 
 54.23  in section 422A.16, and in addition thereto have contributed to 
 54.24  the retirement fund at the percentage rate prescribed by the 
 54.25  retirement law applicable when the salary, wages or compensation 
 54.26  was paid on all salaries, wages, or compensation received from 
 54.27  the city or from an applicable employing unit.  The years of 
 54.28  service to be applied in the formula pension and annuity shall 
 54.29  must be found and determined by the retirement board, except 
 54.30  that no credit shall may be allowed for any year in which a back 
 54.31  charge is owing at time of retirement and the earnings from any 
 54.32  year in which a back charge is owing shall may not be used in 
 54.33  determining the average annual salary. 
 54.34     Sec. 20.  Minnesota Statutes 2004, section 422A.16, 
 54.35  subdivision 9, is amended to read: 
 54.36     Subd. 9.  [INCOMPETENCY OR DEATH OF MEMBER.] Any member of 
 55.1   the contributing class who becomes permanently separated from 
 55.2   the service of the city under subdivision 8, may, by an 
 55.3   instrument in writing, filed with the municipal employees 
 55.4   retirement board within 30 days after such the separation 
 55.5   becomes permanent, elect to allow the member contributions 
 55.6   to such the fund to the date of separation to remain on deposit 
 55.7   in such the fund, and in such the event the member shall be 
 55.8   is entitled to receive a retirement allowance at age 65, 
 55.9   provided the member, or someone acting in the member's behalf if 
 55.10  the member be incompetent, shall must make a written application 
 55.11  for such the retirement allowance in the same manner provided 
 55.12  for in section 422A.17 and in accordance with the provisions of 
 55.13  section 422A.15, subdivision 1, except for determining 
 55.14  average annual salary.  A member with more than five calendar 
 55.15  years of service but less than ten calendar years may select any 
 55.16  five calendar years of service to determine the average annual 
 55.17  salary.  A member with less than five years of service with the 
 55.18  city shall use all earnings to determine the average annual 
 55.19  salary. 
 55.20     If the contributing member dies before reaching the age of 
 55.21  65 years, or having attained the age of 65 years without having 
 55.22  made the election provided for herein, the net accumulated 
 55.23  amount of deductions from the member's salary, pay or 
 55.24  compensation, plus interest, to the member's credit on date of 
 55.25  death shall be paid is payable to such the person or persons as 
 55.26  have been nominated by written designation filed with the 
 55.27  retirement board, in such the form as that the retirement board 
 55.28  shall require requires. 
 55.29     If the employee fails to make a designation, or if the 
 55.30  person or persons designated by such the employee predeceases 
 55.31  such the employee, the net accumulated credit to such the 
 55.32  employee's account on date of death shall be paid is payable to 
 55.33  such the employee's estate. 
 55.34     The provisions of subdivisions 4, 5, and 6 shall also apply 
 55.35  to any member qualifying for benefits under this subdivision, 
 55.36  except for purposes of this subdivision the age referred to in 
 56.1   subdivision 4 shall be is 65 years. 
 56.2      Sec. 21.  Minnesota Statutes 2004, section 490.121, 
 56.3   subdivision 21, is amended to read: 
 56.4      Subd. 21.  [FINAL AVERAGE COMPENSATION.] "Final average 
 56.5   compensation" means the total amount of salary payable to a 
 56.6   judge in the highest five years out of the last ten years prior 
 56.7   to before the event of maturity of benefits termination of 
 56.8   judicial service, divided by five; provided, however, that if 
 56.9   the number of years of service by the judge equals or exceeds 
 56.10  ten.  If the number of years of service by the judge is less 
 56.11  than ten, but more than five, the highest five shall years of 
 56.12  salary must be counted, and.  If the number of years of service 
 56.13  by the judge is less than five, the aggregate salary in such for 
 56.14  the period shall of service must be divided by the number of 
 56.15  months in such the period and multiplied by 12. 
 56.16     Sec. 22.  [REPEALER.] 
 56.17     Minnesota Statutes 2004, sections 352C.031, subdivision 3; 
 56.18  353.29, subdivision 2; and 353.651, subdivision 2, are repealed. 
 56.19     Sec. 23.  [EFFECTIVE DATE.] 
 56.20     This article is effective July 1, 2005. 
 56.21                             ARTICLE 3
 56.22                      ALLOWABLE SERVICE CREDIT
 56.23     Section 1.  [356.195] [SERVICE CREDIT PURCHASE PROCEDURES 
 56.24  FOR STRIKE PERIODS.] 
 56.25     Subdivision 1.  [COVERED PLANS.] This section applies to 
 56.26  all defined benefit plans specified in section 356.30, 
 56.27  subdivision 3. 
 56.28     Subd. 2.  [PURCHASE PROCEDURE FOR STRIKE PERIODS.] (a) An 
 56.29  employee covered by a plan specified in subdivision 1 may 
 56.30  purchase allowable service credit in the applicable plan for any 
 56.31  period of time during which the employee was on a public 
 56.32  employee strike without pay, not to exceed a period of one year, 
 56.33  if the employee makes a payment in lieu of salary deductions as 
 56.34  specified in paragraph (b) or (c), whichever applies.  The 
 56.35  employing unit, at its option, may pay the employer portion of 
 56.36  the amount specified in paragraph (b) on behalf of its employees.
 57.1      (b) If payment is received by the applicable pension plan 
 57.2   executive director within one year from the end of the strike, 
 57.3   the payment amount is equal to the applicable employee and 
 57.4   employer contribution rates specified in law for the applicable 
 57.5   plan during the strike period, applied to the employee's rate of 
 57.6   salary in effect at the conclusion of the strike for the period 
 57.7   of the strike without pay, plus compound interest at a monthly 
 57.8   rate of 0.71 percent from the last day of the strike period 
 57.9   until the date payment is received. 
 57.10     (c) If payment is received by the applicable pension fund 
 57.11  director after one year and before five years from the end of 
 57.12  the strike, the payment amount is the amount determined under 
 57.13  section 356.551. 
 57.14     (d) Payments may not be made more than five years after the 
 57.15  end of the strike. 
 57.16     Sec. 2.  Minnesota Statutes 2004, section 490.121, 
 57.17  subdivision 4, is amended to read: 
 57.18     Subd. 4.  [ALLOWABLE SERVICE.] (a) "Allowable service" 
 57.19  means any calendar month, subject to the service credit limit in 
 57.20  subdivision 22, served as a judge at any time, or served as a 
 57.21  referee in probate for all referees in probate who were in 
 57.22  office prior to January 1, 1974. 
 57.23     (b) "Allowable service" also means a period of authorized 
 57.24  leave of absence for which the judge has made a payment in lieu 
 57.25  of contributions, not in an amount in excess of the service 
 57.26  credit limit under subdivision 22.  To obtain the service 
 57.27  credit, the judge shall pay an amount equal to the member and 
 57.28  employer contribution rates under section 490.123, subdivisions 
 57.29  1a and 1b, applied to the judge's average monthly salary rate 
 57.30  during the authorized leave of absence and multiplied by the 
 57.31  number of months of the authorized leave of absence, plus annual 
 57.32  compound interest at the rate of 8.5 percent from the date of 
 57.33  the termination of the leave to the date on which payment is 
 57.34  made.  The payment must be made within one year of the date on 
 57.35  which the authorized leave of absence terminated.  Service 
 57.36  credit for an authorized leave of absence is in addition to a 
 58.1   uniformed service leave under section 490.1211. 
 58.2      Sec. 3.  Laws 1999, chapter 222, article 16, section 16, as 
 58.3   amended by Laws 2002, chapter 392, article 7, section 1, and 
 58.4   Laws 2003, First Special Session chapter 12, article 6, section 
 58.5   2, and Laws 2004, chapter 267, article 17, section 6, is amended 
 58.6   to read:  
 58.7      Sec. 16.  [REPEALER.] 
 58.8      (a) Sections 2 to 6 and 8 to 13 are repealed on May 16, 
 58.9   2004.  
 58.10     (b) Sections 1 and 7 are repealed on May 16, 2006 2007.  
 58.11     Sec. 4.  Laws 2000, chapter 461, article 4, section 4, as 
 58.12  amended by Laws 2003, First Special Session chapter 12, article 
 58.13  6, section 3, and Laws 2004, chapter 267, article 17, section 7, 
 58.14  is amended to read:  
 58.15     Sec. 4.  [EFFECTIVE DATE; SUNSET REPEALER.] 
 58.16     (a) Sections 1, 2, and 3 are effective on the day following 
 58.17  final enactment.  
 58.18     (b) Sections 1, 2, and 3, are repealed on May 16, 2006 2007.
 58.19     Sec. 5.  [METRO TRANSIT STRIKE PROVISION.] 
 58.20     Notwithstanding the payment deadline specified in Minnesota 
 58.21  Statutes, section 356.195, subdivision 2, paragraph (b), a Metro 
 58.22  Transit employee covered by the general state employees 
 58.23  retirement plan of the Minnesota State Retirement System who was 
 58.24  on strike on or after January 1, 2004, and before the effective 
 58.25  date of this section, is authorized to make a payment under that 
 58.26  paragraph on or before one year after the effective date of this 
 58.27  section. 
 58.28     Sec. 6.  [CROSBY-IRONTON PUBLIC SCHOOL STRIKE PROVISION.] 
 58.29     Notwithstanding the payment deadline specified in Minnesota 
 58.30  Statutes, section 356.195, subdivision 2, paragraph (b), a 
 58.31  Crosby-Ironton public school teacher covered by the Teachers 
 58.32  Retirement Association who was on strike during a period that 
 58.33  included April 1, 2005, and before the effective date of this 
 58.34  section, is authorized to make a payment under that paragraph on 
 58.35  or before one year after the effective date of this section. 
 58.36     Sec. 7.  [EFFECTIVE DATE.] 
 59.1      (a) Sections 1 and 3 to 6 are effective the day following 
 59.2   final enactment. 
 59.3      (b) Section 2 is effective retroactively from January 1, 
 59.4   2005, and applies to any person who was in active service as a 
 59.5   judge on or after that date and applies to an authorized leave 
 59.6   of absence that occurred before or after that date.  For a 
 59.7   person for whom section 2 is retroactive, the equivalent 
 59.8   contribution payment must be made on or before July 1, 2006. 
 59.9                              ARTICLE 4
 59.10              ACTUARIAL FINANCIAL REPORTING AND OTHER 
 59.11            GENERALLY APPLICABLE ADMINISTRATIVE CHANGES
 59.12     Section 1.  Minnesota Statutes 2004, section 352.01, 
 59.13  subdivision 12, is amended to read: 
 59.14     Subd. 12.  [ACTUARIAL EQUIVALENT.] "Actuarial equivalent" 
 59.15  means the condition of one annuity or benefit having an equal 
 59.16  actuarial present value as another annuity or benefit, 
 59.17  determined as of a given date at a specified age with each 
 59.18  actuarial present value based on the appropriate mortality table 
 59.19  adopted by the board of directors based on the experience of the 
 59.20  fund as recommended by the actuary retained by the Legislative 
 59.21  Commission on Pensions and Retirement under section 356.214, and 
 59.22  approved under section 356.215, subdivision 18, and using the 
 59.23  applicable preretirement or postretirement interest rate 
 59.24  assumption specified in section 356.215, subdivision 8. 
 59.25     Sec. 2.  Minnesota Statutes 2004, section 353.01, 
 59.26  subdivision 14, is amended to read: 
 59.27     Subd. 14.  [ACTUARIAL EQUIVALENT.] "Actuarial equivalent" 
 59.28  means the condition of one annuity or benefit having an equal 
 59.29  actuarial present value as another annuity or benefit, 
 59.30  determined as of a given date with each actuarial present value 
 59.31  based on the appropriate mortality table adopted by the board of 
 59.32  trustees based on the experience of the fund as recommended by 
 59.33  the actuary retained by the Legislative Commission on Pensions 
 59.34  and Retirement under section 356.214, and approved under section 
 59.35  356.215, subdivision 18, and using the applicable preretirement 
 59.36  or postretirement interest rate assumption specified in section 
 60.1   356.215, subdivision 8.  
 60.2      Sec. 3.  Minnesota Statutes 2004, section 354.05, 
 60.3   subdivision 7, is amended to read: 
 60.4      Subd. 7.  [ACTUARIAL EQUIVALENT.] "Actuarial equivalent" 
 60.5   means the condition of one annuity or benefit having an equal 
 60.6   actuarial present value as another annuity or benefit, 
 60.7   determined as of a given date with each actuarial present value 
 60.8   based on the appropriate mortality table adopted by the board of 
 60.9   trustees based on the experience of the association as 
 60.10  recommended by the actuary retained by the Legislative 
 60.11  Commission on Pensions and Retirement under section 356.214, and 
 60.12  approved under section 356.215, subdivision 18, and using the 
 60.13  applicable preretirement or postretirement interest rate 
 60.14  assumption specified in section 356.215, subdivision 8. 
 60.15     Sec. 4.  Minnesota Statutes 2004, section 354.094, 
 60.16  subdivision 1, is amended to read: 
 60.17     Subdivision 1.  [SERVICE CREDIT CONTRIBUTIONS.] (a) Upon 
 60.18  granting any extended leave of absence under section 122A.46 or 
 60.19  136F.43, the employing unit granting the leave must certify the 
 60.20  leave to the association on a form specified by the executive 
 60.21  director.  A member granted an extended leave of absence under 
 60.22  section 122A.46 or 136F.43 may pay employee contributions and 
 60.23  receive allowable service credit toward annuities and other 
 60.24  benefits under this chapter, for each year of the leave, 
 60.25  provided that the member and the employing board make the 
 60.26  required employer contribution in any proportion they may agree 
 60.27  upon, during the period of the leave.  The employer may enter 
 60.28  into an agreement with the exclusive bargaining representative 
 60.29  of the teachers in the district under which, for an individual 
 60.30  teacher, all or a portion of the employee's contribution is paid 
 60.31  by the employer.  Any such agreement must include a sunset of 
 60.32  eligibility to qualify for the payment and must not be a part of 
 60.33  the collective bargaining agreement.  The leave period must not 
 60.34  exceed five years.  A member may not receive more than five 
 60.35  years of allowable service credit under this section.  The 
 60.36  employee and employer contributions must be based upon the rates 
 61.1   of contribution prescribed by section 354.42 for the salary 
 61.2   received during the year immediately preceding the extended 
 61.3   leave.  
 61.4      (b) Employee contribution payments for the years for which 
 61.5   a member is receiving service credit while on extended leave 
 61.6   must be made on or before the later of June 30 of each fiscal 
 61.7   year for which service credit is to be received or within 30 
 61.8   days after first notification of the amount due, if requested by 
 61.9   the member, is given by the association.  If payment is to be 
 61.10  made by a transfer of pretax assets authorized under section 
 61.11  356.441, payment is authorized after June 30 of the fiscal year 
 61.12  providing that authorization for the asset transfer has been 
 61.13  received by the applicable third party administrator by June 30, 
 61.14  and the payment must include interest at a rate of .708 percent 
 61.15  per month from June 30 through the end of the month in which 
 61.16  payment is received.  No payment is permitted after the 
 61.17  following September 30.  Payments received after June 30 must 
 61.18  include interest at an annual rate of 8.5 percent from June 30 
 61.19  through the end of the month in which payment is received.  
 61.20     (c) Notwithstanding the provisions of any agreements to the 
 61.21  contrary, employee and employer contributions may not be made to 
 61.22  receive allowable service credit if the member does not have 
 61.23  full reinstatement rights as provided in section 122A.46 or 
 61.24  136F.43, both during and at the end of the extended leave. 
 61.25     (d) Any school district paying the employee's retirement 
 61.26  contributions under this section shall forward to the applicable 
 61.27  retirement association or retirement fund a copy of the 
 61.28  agreement executed by the school district and the employee. 
 61.29     Sec. 5.  Minnesota Statutes 2004, section 354A.011, 
 61.30  subdivision 3a, is amended to read: 
 61.31     Subd. 3a.  [ACTUARIAL EQUIVALENT.] "Actuarial equivalent" 
 61.32  means the condition of one annuity or benefit having an equal 
 61.33  actuarial present value as another annuity or benefit, 
 61.34  determined as of a given date with each actuarial present value 
 61.35  based on the appropriate mortality table adopted by the 
 61.36  appropriate board of trustees based on the experience of that 
 62.1   retirement fund association as recommended by the actuary 
 62.2   retained by the Legislative Commission on Pensions and 
 62.3   Retirement under section 356.214, and approved under section 
 62.4   356.215, subdivision 18, and using the applicable preretirement 
 62.5   or postretirement interest rate assumption specified in section 
 62.6   356.215, subdivision 8. 
 62.7      Sec. 6.  Minnesota Statutes 2004, section 356.20, 
 62.8   subdivision 4, is amended to read: 
 62.9      Subd. 4.  [CONTENTS OF FINANCIAL REPORT.] (a) The financial 
 62.10  report required by this section must contain financial 
 62.11  statements and disclosures that indicate the financial 
 62.12  operations and position of the retirement plan and fund.  The 
 62.13  report must conform with generally accepted governmental 
 62.14  accounting principles, applied on a consistent basis.  The 
 62.15  report must be audited.  The report must include, as part of its 
 62.16  exhibits or its footnotes, an actuarial disclosure item based on 
 62.17  the actuarial valuation calculations prepared by the 
 62.18  commission-retained actuary retained under section 356.214 or by 
 62.19  the actuary retained by the retirement fund or plan, if 
 62.20  applicable whichever applies, according to applicable actuarial 
 62.21  requirements enumerated in section 356.215, and specified in the 
 62.22  most recent standards for actuarial work adopted by the 
 62.23  Legislative Commission on Pensions and Retirement.  The accrued 
 62.24  assets, the accrued liabilities, including accrued reserves, and 
 62.25  the unfunded actuarial accrued liability of the fund or plan 
 62.26  must be disclosed.  The disclosure item must contain a 
 62.27  declaration by the actuary retained by the Legislative 
 62.28  Commission on Pensions and Retirement under section 356.214 or 
 62.29  the actuary retained by the fund or plan, whichever applies, 
 62.30  specifying that the required reserves for any retirement, 
 62.31  disability, or survivor benefits provided under a benefit 
 62.32  formula are computed in accordance with the entry age actuarial 
 62.33  cost method and in accordance with the most recent applicable 
 62.34  standards for actuarial work adopted by the Legislative 
 62.35  Commission on Pensions and Retirement. 
 62.36     (b) Assets of the fund or plan contained in the disclosure 
 63.1   item must include the following statement of the actuarial value 
 63.2   of current assets as defined in section 356.215, subdivision 1: 
 63.3                                       Value         Value 
 63.4                                      at cost       at market
 63.5    Cash, cash equivalents, and  
 63.6      short-term securities           .........     ......... 
 63.7    Accounts receivable               .........     .........
 63.8    Accrued investment income         .........     .........  
 63.9    Fixed income investments          .........     ......... 
 63.10   Equity investments other 
 63.11     than real estate                .........     ......... 
 63.12   Real estate investments           .........     ......... 
 63.13   Equipment                         .........     ......... 
 63.14   Equity Participation in the Minnesota 
 63.15     postretirement investment
 63.16     fund or the retirement
 63.17     benefit fund                    .........     ......... 
 63.18   Other                             .........     .........  
 63.19    
 63.20   Total assets 
 63.21     Value at cost                                 .........
 63.22     Value at market                               ......... 
 63.23     Actuarial value of current assets             ......... 
 63.24     (c) The unfunded actuarial accrued liability of the fund or 
 63.25  plan contained in the disclosure item must include the following 
 63.26  measures of unfunded actuarial accrued liability, using 
 63.27  the actuarial value of current assets:  
 63.28     (1) the unfunded actuarial accrued liability, determined by 
 63.29  subtracting the current assets and the present value of future 
 63.30  normal costs from the total current and expected future benefit 
 63.31  obligations; and 
 63.32     (2) the unfunded pension benefit obligation, determined by 
 63.33  subtracting the current assets from the actuarial present value 
 63.34  of credited projected benefits. 
 63.35     If the current assets of the fund or plan exceed the 
 63.36  actuarial accrued liabilities, the excess must be disclosed and 
 64.1   indicated as a surplus. 
 64.2      (d) The pension benefit obligations schedule included in 
 64.3   the disclosure must contain the following information on the 
 64.4   benefit obligations: 
 64.5      (1) the pension benefit obligation, determined as the 
 64.6   actuarial present value of credited projected benefits on 
 64.7   account of service rendered to date, separately identified as 
 64.8   follows: 
 64.9            (i) for annuitants;
 64.10                 retirement annuities;
 64.11                 disability benefits;
 64.12                 surviving spouse and child benefits;
 64.13           (ii)  for former members without vested rights;
 64.14           (iii) for deferred annuitants' benefits, including 
 64.15                 any augmentation;
 64.16           (iv)  for active employees;
 64.17                 accumulated employee contributions,
 64.18                 including allocated investment income;
 64.19                 employer-financed benefits vested;
 64.20                 employer-financed benefits nonvested;
 64.21                 total pension benefit obligation; and
 64.22     (2) if there are additional benefits not appropriately 
 64.23  covered by the foregoing items of benefit obligations, a 
 64.24  separate identification of the obligation. 
 64.25     (e) The report must contain an itemized exhibit describing 
 64.26  the administrative expenses of the plan, including, but not 
 64.27  limited to, the following items, classified on a consistent 
 64.28  basis from year to year, and with any further meaningful detail: 
 64.29     (1) personnel expenses; 
 64.30     (2) communication-related expenses; 
 64.31     (3) office building and maintenance expenses; 
 64.32     (4) professional services fees; and 
 64.33     (5) other expenses. 
 64.34     (f) The report must contain an itemized exhibit describing 
 64.35  the investment expenses of the plan, including, but not limited 
 64.36  to, the following items, classified on a consistent basis from 
 65.1   year to year, and with any further meaningful detail: 
 65.2      (1) internal investment-related expenses; and 
 65.3      (2) external investment-related expenses. 
 65.4      (g) Any additional statements or exhibits or more detailed 
 65.5   or subdivided itemization of a disclosure item that will enable 
 65.6   the management of the fund to portray a true interpretation of 
 65.7   the fund's financial condition must be included in the 
 65.8   additional statements or exhibits. 
 65.9      Sec. 7.  Minnesota Statutes 2004, section 356.47, 
 65.10  subdivision 3, is amended to read: 
 65.11     Subd. 3.  [PAYMENT.] (a) Upon the retired member attaining 
 65.12  the age of 65 years or upon the first day of the month next 
 65.13  following the month occurring one year after the termination of 
 65.14  the reemployment that gave rise to the limitation, whichever is 
 65.15  later, and the filing of a written application, the retired 
 65.16  member is entitled to the payment, in a lump sum, of the value 
 65.17  of the person's amount under subdivision 2, plus interest at the 
 65.18  compound annual rate of six percent from the date that the 
 65.19  amount was deducted from the retirement annuity to the date of 
 65.20  payment. 
 65.21     (b) The written application must be on a form prescribed by 
 65.22  the chief administrative officer of the applicable retirement 
 65.23  plan. 
 65.24     (c) If the retired member dies before the payment provided 
 65.25  for in paragraph (a) is made, the amount is payable, upon 
 65.26  written application, to the deceased person's surviving spouse, 
 65.27  or if none, to the deceased person's designated beneficiary, or 
 65.28  if none, to the deceased person's estate. 
 65.29     (d) In lieu of the direct payment of the person's amount 
 65.30  under subdivision 2, on or after the payment date under 
 65.31  paragraph (a), if the federal Internal Revenue Code so permits, 
 65.32  the retired member may elect to have all or any portion of the 
 65.33  payment amount under this section paid in the form of a direct 
 65.34  rollover to an eligible retirement plan as defined in section 
 65.35  402(c) of the federal Internal Revenue Code that is specified by 
 65.36  the retired member.  If the retired member dies with a balance 
 66.1   remaining payable under this section, the surviving spouse of 
 66.2   the retired member, or if none, the deceased person's designated 
 66.3   beneficiary, or if none, the administrator of the deceased 
 66.4   person's estate may elect a direct rollover under this paragraph.
 66.5      Sec. 8.  Minnesota Statutes 2004, section 422A.01, 
 66.6   subdivision 6, is amended to read: 
 66.7      Subd. 6.  [PRESENT WORTH OR PRESENT VALUE.] "Present worth" 
 66.8   or "present value" means that the present amount of money if 
 66.9   increased at the applicable postretirement or preretirement 
 66.10  interest rate assumption specified in section 356.215, 
 66.11  subdivision 8, and based on the mortality table adopted by the 
 66.12  board of trustees based on the experience of the fund as 
 66.13  recommended by the actuary retained by the Legislative 
 66.14  Commission on Pensions and Retirement under section 356.214, and 
 66.15  approved under section 356.215, subdivision 18, will at 
 66.16  retirement equal the actuarial accrued liability of the annuity 
 66.17  already earned. 
 66.18     Sec. 9.  Minnesota Statutes 2004, section 490.121, 
 66.19  subdivision 20, is amended to read: 
 66.20     Subd. 20.  [ACTUARIAL EQUIVALENT.] "Actuarial equivalent" 
 66.21  means the condition of one annuity or benefit having an equal 
 66.22  actuarial present value as another annuity or benefit, 
 66.23  determined as of a given date with each actuarial present value 
 66.24  based on the appropriate mortality table adopted by the board of 
 66.25  trustees directors of the Minnesota State Retirement System 
 66.26  based on the experience of the fund as recommended by 
 66.27  the commission-retained actuary retained under section 356.214, 
 66.28  and approved under section 356.215, subdivision 18, and using 
 66.29  the applicable preretirement or postretirement interest rate 
 66.30  assumption specified in section 356.215, subdivision 8. 
 66.31     Sec. 10.  [EFFECTIVE DATE.] 
 66.32     (a) Sections 1 to 5, 8, and 9 are effective on July 1, 2005.
 66.33     (b) Section 6 is effective the day following final 
 66.34  enactment and applies to annual financial reporting occurring on 
 66.35  or after June 30, 2005. 
 66.36     (c) Section 4 is effective on the day following final 
 67.1   enactment.  
 67.2      (d) Section 7 is effective on July 1, 2005, and applies to 
 67.3   retired members with an amount in a reemployed annuitant's 
 67.4   account on or after that date. 
 67.5                              ARTICLE 5
 67.6                        MEMBERSHIP INCLUSIONS
 67.7                            AND EXCLUSIONS
 67.8      Section 1.  Minnesota Statutes 2004, section 69.011, is 
 67.9   amended by adding a subdivision to read: 
 67.10     Subd. 2c.  [INELIGIBILITY OF CERTAIN POLICE OFFICERS.] A 
 67.11  police officer employed by the University of Minnesota who is 
 67.12  required by the Board of Regents to be a member of the 
 67.13  University of Minnesota faculty retirement plan is not eligible 
 67.14  to be included in any police state-aid certification under this 
 67.15  section. 
 67.16     Sec. 2.  Minnesota Statutes 2004, section 352.01, 
 67.17  subdivision 2a, is amended to read: 
 67.18     Subd. 2a.  [INCLUDED EMPLOYEES.] (a) "State employee" 
 67.19  includes: 
 67.20     (1) employees of the Minnesota Historical Society; 
 67.21     (2) employees of the State Horticultural Society; 
 67.22     (3) employees of the Disabled American Veterans, Department 
 67.23  of Minnesota, Veterans of Foreign Wars, Department of Minnesota, 
 67.24  if employed before July 1, 1963; 
 67.25     (4) employees of the Minnesota Crop Improvement 
 67.26  Association; 
 67.27     (5) employees of the adjutant general who are paid from 
 67.28  federal funds and who are not covered by any federal civilian 
 67.29  employees retirement system; 
 67.30     (6) employees of the Minnesota State Colleges and 
 67.31  Universities employed under the university or college activities 
 67.32  program; 
 67.33     (7) currently contributing employees covered by the system 
 67.34  who are temporarily employed by the legislature during a 
 67.35  legislative session or any currently contributing employee 
 67.36  employed for any special service as defined in subdivision 2b, 
 68.1   clause (8); 
 68.2      (8) employees of the Armory Building Commission; 
 68.3      (9) employees of the legislature appointed without a limit 
 68.4   on the duration of their employment and persons employed or 
 68.5   designated by the legislature or by a legislative committee or 
 68.6   commission or other competent authority to conduct a special 
 68.7   inquiry, investigation, examination, or installation; 
 68.8      (10) trainees who are employed on a full-time established 
 68.9   training program performing the duties of the classified 
 68.10  position for which they will be eligible to receive immediate 
 68.11  appointment at the completion of the training period; 
 68.12     (11) employees of the Minnesota Safety Council; 
 68.13     (12) any employees on authorized leave of absence from the 
 68.14  Transit Operating Division of the former Metropolitan Transit 
 68.15  Commission who are employed by the labor organization which is 
 68.16  the exclusive bargaining agent representing employees of the 
 68.17  Transit Operating Division; 
 68.18     (13) employees of the Metropolitan Council, Metropolitan 
 68.19  Parks and Open Space Commission, Metropolitan Sports Facilities 
 68.20  Commission, Metropolitan Mosquito Control Commission, or 
 68.21  Metropolitan Radio Board unless excluded or covered by another 
 68.22  public pension fund or plan under section 473.415, subdivision 
 68.23  3; 
 68.24     (14) judges of the Tax Court; 
 68.25     (15) personnel employed on June 30, 1992, by the University 
 68.26  of Minnesota in the management, operation, or maintenance of its 
 68.27  heating plant facilities, whose employment transfers to an 
 68.28  employer assuming operation of the heating plant facilities, so 
 68.29  long as the person is employed at the University of Minnesota 
 68.30  heating plant by that employer or by its successor organization; 
 68.31  and 
 68.32     (16) seasonal help in the classified service employed by 
 68.33  the Department of Revenue; and 
 68.34     (17) persons employed by the Department of Commerce as a 
 68.35  peace officer in the Insurance Fraud Prevention Division under 
 68.36  section 45.0135 who have attained the mandatory retirement age 
 69.1   specified in section 43A.34, subdivision 4.  
 69.2      (b) Employees specified in paragraph (a), clause (15), are 
 69.3   included employees under paragraph (a) if employer and employee 
 69.4   contributions are made in a timely manner in the amounts 
 69.5   required by section 352.04.  Employee contributions must be 
 69.6   deducted from salary.  Employer contributions are the sole 
 69.7   obligation of the employer assuming operation of the University 
 69.8   of Minnesota heating plant facilities or any successor 
 69.9   organizations to that employer. 
 69.10     Sec. 3.  Minnesota Statutes 2004, section 352.91, is 
 69.11  amended by adding a subdivision to read: 
 69.12     Subd. 4a.  [PROCESS FOR EVALUATING AND RECOMMENDING 
 69.13  POTENTIAL EMPLOYMENT POSITIONS FOR MEMBERSHIP INCLUSION.] (a) 
 69.14  The Department of Corrections and the Department of Human 
 69.15  Services must establish a procedure for evaluating periodic 
 69.16  requests by department employees for qualification for 
 69.17  recommendation by the commissioner for inclusion of the 
 69.18  employment position in the correctional facility or human 
 69.19  services facility in the correctional retirement plan and for 
 69.20  periodically determining employment positions that no longer 
 69.21  qualify for continued correctional retirement plan coverage.  
 69.22     (b) The procedure must provide for an evaluation of the 
 69.23  extent of the employee's working time spent in direct contact 
 69.24  with patients or inmates, the extent of the physical hazard that 
 69.25  the employee is routinely subjected to in the course of 
 69.26  employment, and the extent of intervention routinely expected of 
 69.27  the employee in the event of a facility incident.  The 
 69.28  percentage of routine direct contact with inmates or patients 
 69.29  may not be less than 75 percent.  
 69.30     (c) The applicable commissioner shall notify the employee 
 69.31  of the determination of the appropriateness of recommending the 
 69.32  employment position for inclusion in the correctional retirement 
 69.33  plan, if the evaluation procedure results in a finding that the 
 69.34  employee: 
 69.35     (1) routinely spends 75 percent of the employee's time in 
 69.36  direct contact with inmates or patients; and 
 70.1      (2) is regularly engaged in the rehabilitation, treatment, 
 70.2   custody, or supervision of inmates or patients.  
 70.3      (d) After providing the affected employee an opportunity to 
 70.4   dispute or clarify any evaluation determinations, if the 
 70.5   commissioner determines that the employment position is 
 70.6   appropriate for inclusion in the correctional retirement plan, 
 70.7   the commissioner shall forward that recommendation and 
 70.8   supporting documentation to the chair of the Legislative 
 70.9   Commission on Pensions and Retirement, the chair of the State 
 70.10  and Local Governmental Operations Committee of the senate, the 
 70.11  chair of the Governmental Operations and Veterans Affairs Policy 
 70.12  Committee of the house of representatives, and the executive 
 70.13  director of the Legislative Commission on Pensions and 
 70.14  Retirement in the form of the appropriate proposed legislation.  
 70.15  The recommendation must be forwarded to the legislature before 
 70.16  January 15 for the recommendation to be considered in that 
 70.17  year's legislative session.  
 70.18     Sec. 4.  Minnesota Statutes 2004, section 352B.01, 
 70.19  subdivision 2, is amended to read: 
 70.20     Subd. 2.  [MEMBER.] "Member" means: 
 70.21     (1) a State Patrol member currently employed after June 30, 
 70.22  1943, under section 299D.03 by the state, who is a peace officer 
 70.23  under section 626.84, and whose salary or compensation is paid 
 70.24  out of state funds; 
 70.25     (2) a conservation officer employed under section 97A.201, 
 70.26  currently employed by the state, whose salary or compensation is 
 70.27  paid out of state funds; 
 70.28     (3) a crime bureau officer who was employed by the crime 
 70.29  bureau and was a member of the Highway Patrolmen's retirement 
 70.30  fund on July 1, 1978, whether or not that person has the power 
 70.31  of arrest by warrant after that date, or who is employed as 
 70.32  police personnel, with powers of arrest by warrant under section 
 70.33  299C.04, and who is currently employed by the state, and whose 
 70.34  salary or compensation is paid out of state funds; 
 70.35     (4) a person who is employed by the state in the Department 
 70.36  of Public Safety in a data processing management position with 
 71.1   salary or compensation paid from state funds, who was a crime 
 71.2   bureau officer covered by the State Patrol retirement plan on 
 71.3   August 15, 1987, and who was initially hired in the data 
 71.4   processing management position within the department during 
 71.5   September 1987, or January 1988, with membership continuing for 
 71.6   the duration of the person's employment in that position, 
 71.7   whether or not the person has the power of arrest by warrant 
 71.8   after August 15, 1987; 
 71.9      (5) a public safety employee defined as a peace officer in 
 71.10  section 626.84, subdivision 1, paragraph (c), and employed with 
 71.11  the Division of Alcohol and Gambling Enforcement under section 
 71.12  299L.01; and 
 71.13     (6) a Fugitive Apprehension Unit officer after October 31, 
 71.14  2000, employed by the Office of Special Investigations of the 
 71.15  Department of Corrections who is a peace officer under section 
 71.16  626.84; and 
 71.17     (7) an employee of the Department of Commerce defined as a 
 71.18  peace officer in section 626.84, subdivision 1, paragraph (c), 
 71.19  who is employed by the Division of Insurance Fraud Prevention 
 71.20  under section 45.0135 after January 1, 2005, and who has not 
 71.21  attained the mandatory retirement age specified in section 
 71.22  43A.34, subdivision 4.  
 71.23     Sec. 5.  Minnesota Statutes 2004, section 353.01, 
 71.24  subdivision 6, is amended to read: 
 71.25     Subd. 6.  [GOVERNMENTAL SUBDIVISION.] (a) "Governmental 
 71.26  subdivision" means a county, city, town, school district within 
 71.27  this state, or a department or unit of state government, or any 
 71.28  public body whose revenues are derived from taxation, fees, 
 71.29  assessments or from other sources. 
 71.30     (b) Governmental subdivision also means the Public 
 71.31  Employees Retirement Association, the League of Minnesota 
 71.32  Cities, the Association of Metropolitan Municipalities, public 
 71.33  hospitals owned or operated by, or an integral part of, a 
 71.34  governmental subdivision or governmental subdivisions, the 
 71.35  Association of Minnesota Counties, the Metropolitan Intercounty 
 71.36  Association, the Minnesota Municipal Utilities Association, the 
 72.1   Metropolitan Airports Commission, the University of Minnesota 
 72.2   with respect to police officers covered by the public employees 
 72.3   police and fire retirement plan, the Minneapolis Employees 
 72.4   Retirement Fund for employment initially commenced after June 
 72.5   30, 1979, the Range Association of Municipalities and Schools, 
 72.6   soil and water conservation districts, economic development 
 72.7   authorities created or operating under sections 469.090 to 
 72.8   469.108, the Port Authority of the city of St. Paul, the Spring 
 72.9   Lake Park Fire Department, incorporated, the Lake Johanna 
 72.10  Volunteer Fire Department, incorporated, the Red Wing 
 72.11  Environmental Learning Center, and the Dakota County 
 72.12  Agricultural Society. 
 72.13     (c) Governmental subdivision does not mean any municipal 
 72.14  housing and redevelopment authority organized under the 
 72.15  provisions of sections 469.001 to 469.047; or any port authority 
 72.16  organized under sections 469.048 to 469.089 other than the Port 
 72.17  Authority of the city of St. Paul; or any hospital district 
 72.18  organized or reorganized prior to July 1, 1975, under sections 
 72.19  447.31 to 447.37 or the successor of the district, nor the 
 72.20  Minneapolis Community Development Agency. 
 72.21     Sec. 6.  Minnesota Statutes 2004, section 353.64, is 
 72.22  amended by adding a subdivision to read: 
 72.23     Subd. 6a.  [UNIVERSITY OF MINNESOTA POLICE OFFICERS; 
 72.24  INCLUSIONS AND EXCLUSIONS.] (a) Unless paragraph (b) applies, a 
 72.25  person who is employed as a peace officer by the University of 
 72.26  Minnesota at any campus or facility of the university, who is 
 72.27  required by the university to be and is licensed as a peace 
 72.28  officer by the Minnesota Peace Officer Standards and Training 
 72.29  Board under sections 626.84 to 626.863, and who has the full 
 72.30  power of arrest is a member of the public employees police and 
 72.31  fire retirement plan. 
 72.32     (b) A police officer employed by the University of 
 72.33  Minnesota who is required by the Board of Regents to contribute 
 72.34  to the University of Minnesota faculty retirement plan is not 
 72.35  eligible to be a member of the public employees police and fire 
 72.36  retirement plan. 
 73.1      Sec. 7.  Minnesota Statutes 2004, section 354B.21, 
 73.2   subdivision 2, is amended to read: 
 73.3      Subd. 2.  [COVERAGE; ELECTION.] (a) An eligible person is 
 73.4   entitled to elect coverage by the plan.  If the eligible person 
 73.5   does not make a timely election of coverage by the plan, the 
 73.6   person has the coverage specified in subdivision 3. 
 73.7      (b) For eligible persons who were employed by the former 
 73.8   state university system or the former community college system 
 73.9   before May 1, 1995, the person has the retirement coverage that 
 73.10  the person had for employment immediately before May 1, 1995. 
 73.11     (c) (b) For all other eligible persons, the election of 
 73.12  coverage must be made within 90 days of May 10, 1995, or 90 days 
 73.13  of receiving notice from the employer of the options available 
 73.14  under this section, whichever occurs later unless otherwise 
 73.15  specified in this section, the eligible person is authorized to 
 73.16  elect prospective Teachers Retirement Association plan coverage 
 73.17  rather than coverage by the plan established by this chapter.  
 73.18  The election of prospective Teachers Retirement Association plan 
 73.19  coverage shall be made within one year of commencing eligible 
 73.20  Minnesota State Colleges and Universities system employment.  If 
 73.21  an election is not made within the specified election period due 
 73.22  to a termination of Minnesota State Colleges and Universities 
 73.23  system employment, an election may be made within 90 days of 
 73.24  returning to eligible Minnesota State Colleges and Universities 
 73.25  system employment.  All elections are irrevocable.  Prior to 
 73.26  making an election the eligible person shall be covered by the 
 73.27  plan indicated as default coverage under subdivision 3.  
 73.28     (c) A purchase of service credit in the Teachers Retirement 
 73.29  Association plan for any period or periods of Minnesota State 
 73.30  Colleges and Universities system employment occurring prior to 
 73.31  the election under paragraph (b) is prohibited.  
 73.32     Sec. 8.  Minnesota Statutes 2004, section 354B.21, 
 73.33  subdivision 3, is amended to read: 
 73.34     Subd. 3.  [DEFAULT COVERAGE.] (a) Prior to making an 
 73.35  election under subdivision 2, or if an eligible person fails to 
 73.36  elect coverage by the plan under subdivision 2 or if the person 
 74.1   fails to make a timely election, the following retirement 
 74.2   coverage applies: 
 74.3      (1) for employees of the board who are employed in faculty 
 74.4   positions in the technical colleges, in the state universities 
 74.5   or in the community colleges, the retirement coverage is by the 
 74.6   plan established by this chapter; 
 74.7      (2) for employees of the board who are employed in faculty 
 74.8   positions in the technical colleges, the retirement coverage is 
 74.9   by the plan established by this chapter unless on June 30, 1997, 
 74.10  the employee was a member of the Teachers Retirement Association 
 74.11  established under chapter 354 and then the retirement coverage 
 74.12  is by the Teachers Retirement Association, or, unless the 
 74.13  employee was a member of a first class city teacher retirement 
 74.14  fund established under chapter 354A on June 30, 1995, and then 
 74.15  the retirement coverage is by the Duluth Teachers Retirement 
 74.16  Fund Association if the person was a member of that plan on June 
 74.17  30, 1995, or the Minneapolis Teachers Retirement Fund 
 74.18  Association if the person was a member of that plan on June 30, 
 74.19  1995, or the St. Paul Teachers Retirement Fund Association if 
 74.20  the person was a member of that plan on June 30, 1995; and 
 74.21     (3) for employees of the board who are employed in eligible 
 74.22  unclassified administrative positions, the retirement coverage 
 74.23  is by the plan established by this chapter. 
 74.24     (b) If an employee fails to correctly certify prior 
 74.25  membership in the Teachers Retirement Association to the 
 74.26  Minnesota State colleges and Universities system, the system 
 74.27  shall not pay interest on employee contributions, employer 
 74.28  contributions, and additional employer contributions to the 
 74.29  Teachers Retirement Association under section 354.52, 
 74.30  subdivision 4. 
 74.31     Sec. 9.  [EFFECTIVE DATE.] 
 74.32     (a) Sections 1, 3, 5, and 6 are effective July 1, 2005.  
 74.33     (b) Sections 2 and 4 are effective retroactively from 
 74.34  January 1, 2005. 
 74.35     (c) Sections 7 and 8 are effective on the day following 
 74.36  final enactment. 
 75.1                              ARTICLE 6
 75.2                       RETIREMENT CONTRIBUTIONS
 75.3      Section 1.  Minnesota Statutes 2004, section 353.28, 
 75.4   subdivision 5, is amended to read: 
 75.5      Subd. 5.  [INTEREST CHARGES CHARGEABLE ON AMOUNTS DUE.] Any 
 75.6   amount due under this section or section 353.27, subdivision 4, 
 75.7   is payable with interest at an annual compound rate of 8.5 
 75.8   percent compounded annually from the date due until the date 
 75.9   payment is received by the association, with a minimum interest 
 75.10  charge of $10.  Interest for past due payments of excess police 
 75.11  state aid under section 69.031, subdivision 5, must be charged 
 75.12  at an annual rate of 8.5 percent compounded annually. 
 75.13     Sec. 2.  Minnesota Statutes 2004, section 353.28, 
 75.14  subdivision 6, is amended to read: 
 75.15     Subd. 6.  [FAILURE TO PAY COLLECTION OF UNPAID AMOUNTS.] (a)
 75.16  If the a governmental subdivision which receives the direct 
 75.17  proceeds of property taxation fails to pay amounts an amount due 
 75.18  under chapters chapter 353, 353A, 353B, 353C, and or 353D or 
 75.19  fails to make payments of excess police state aid to the public 
 75.20  employees police and fire fund under section 69.031, subdivision 
 75.21  5, the executive director shall certify those amounts the amount 
 75.22  to the governmental subdivision for payment.  If the 
 75.23  governmental subdivision fails to remit the sum so due in a 
 75.24  timely fashion, the executive director shall certify amounts the 
 75.25  amount to the applicable county auditor for collection.  The 
 75.26  county auditor shall collect such amounts the amount out of the 
 75.27  revenue of the governmental subdivision, or shall add them the 
 75.28  amount to the levy of the governmental subdivision and make 
 75.29  payment directly to the association.  This tax shall must be 
 75.30  levied, collected, and apportioned in the manner that other 
 75.31  taxes are levied, collected, and apportioned. 
 75.32     (b) If a governmental subdivision which is not funded 
 75.33  directly from the proceeds of property taxation fails to pay an 
 75.34  amount due under this chapter, the executive director shall 
 75.35  certify the amount to the governmental subdivision for payment.  
 75.36  If the governmental subdivision fails to pay the amount for a 
 76.1   period of 60 days after certification, the executive director 
 76.2   shall certify the amount to the commissioner of finance, who 
 76.3   shall deduct the amount from any subsequent state-aid payment or 
 76.4   state appropriation amount applicable to the governmental 
 76.5   subdivision. 
 76.6      Sec. 3.  [PUBLIC EMPLOYEES RETIREMENT ASSOCIATION; INTEREST 
 76.7   ON SERVICE CREDIT PURCHASE PAYMENT RETURN.] 
 76.8      If a former employee of the Minneapolis Community 
 76.9   Development Agency made a prior service credit purchase payment 
 76.10  under Minnesota Statutes 2002, section 356.55, in an amount that 
 76.11  is greater than the actually required payment amount because of 
 76.12  the use of an inaccurate salary figure or other similar 
 76.13  reporting or clerical error, the general employees retirement 
 76.14  plan of the Public Employees Retirement Association may pay 
 76.15  interest on the overage amount at an annual compound rate of six 
 76.16  percent per year. 
 76.17     Sec. 4.  [RETURN OF PRIOR SERVICE CREDIT PURCHASE PAYMENT 
 76.18  FOR CERTAIN MINNEAPOLIS CITY EMPLOYEES.] 
 76.19     (a) An eligible person, upon written application, may 
 76.20  receive a return of a prior service credit purchase payment 
 76.21  under Minnesota Statutes 2002, section 356.55, plus interest on 
 76.22  the amount at an annual compound rate of six percent per year.  
 76.23  The return amount and interest must be made in an 
 76.24  institution-to-institution transfer to a federal tax qualified 
 76.25  retirement plan or account and may not be paid directly to an 
 76.26  individual.  
 76.27     (b) An eligible person is a person who was an employee of 
 76.28  the Minneapolis Community Development Agency and made a payment 
 76.29  for the purchase of prior service credit under Laws 2003, 
 76.30  chapter 127, article 12, section 31, subdivision 4, and 
 76.31  Minnesota Statutes 2002, section 356.55, in an erroneous amount 
 76.32  because of an inaccurate salary figure supplied by the employing 
 76.33  agency. 
 76.34     Sec. 5.  [EFFECTIVE DATE.] 
 76.35     (a) Sections 1 and 2 are effective July 1, 2005. 
 76.36     (b) Sections 3 and 4 are effective on the day following 
 77.1   final enactment. 
 77.2      (c) Section 4 expires on June 30, 2005. 
 77.3                              ARTICLE 7
 77.4                 PENSION BENEFITS UPON PRIVATIZATION
 77.5      Section 1.  Minnesota Statutes 2004, section 353F.02, 
 77.6   subdivision 4, is amended to read: 
 77.7      Subd. 4.  [MEDICAL FACILITY.] "Medical facility" means: 
 77.8      (1) Bridges Medical Services; 
 77.9      (2) the Fair Oaks Lodge, Wadena; 
 77.10     (2) (3) the Glencoe Area Health Center; 
 77.11     (3) (4) the Hutchinson Area Health Care; 
 77.12     (5) the Kanabec Hospital; 
 77.13     (4) (6) the Luverne Public Hospital; 
 77.14     (7) the Northfield Hospital; 
 77.15     (5) (8) the RenVilla Nursing Home; 
 77.16     (6) (9) the Renville County Hospital in Olivia; 
 77.17     (7) (10) the St. Peter Community Healthcare Center; and 
 77.18     (8) (11) the Waconia-Ridgeview Medical Center. 
 77.19     Sec. 2.  Minnesota Statutes 2004, section 471A.10, is 
 77.20  amended to read: 
 77.21     471A.10 [PUBLIC EMPLOYEE LAWS; SALE OR LEASE OF EXISTING 
 77.22  FACILITY.] 
 77.23     (a) Unless expressly provided therein, and except as 
 77.24  provided in this section, no state law, charter provision, or 
 77.25  ordinance of a municipality relating to public employees shall 
 77.26  apply to a person solely by reason of that person's employment 
 77.27  by a private vendor in connection with services rendered under a 
 77.28  service contract. 
 77.29     (b) A private vendor purchasing or leasing existing related 
 77.30  facilities from a municipality or operating or maintaining the 
 77.31  facility shall recognize all exclusive bargaining 
 77.32  representatives and existing labor agreements and those 
 77.33  agreements shall remain in force until they expire by their 
 77.34  terms.  Persons who are not who were employed by a municipality 
 77.35  in a related facility at the time of and who were members of the 
 77.36  Public Employees Retirement Association general plan due to that 
 78.1   employment are not permitted to remain as active members of the 
 78.2   plan following a lease or purchase of the facility by the a 
 78.3   private vendor are not "public employees" within the meaning of 
 78.4   the Public Employees Retirement Act, chapter 353.  Persons 
 78.5   employed by a municipality in a related facility at the time of 
 78.6   a lease or purchase of the facility by a private vendor shall 
 78.7   continue to be considered to be "public employees" within the 
 78.8   meaning of the Public Employees Retirement Act, chapter 353, but 
 78.9   may elect to terminate their participation in the Public 
 78.10  Employees Retirement Association as provided in this section.  
 78.11  Each such employee may exercise the election annually on the 
 78.12  anniversary of the person's initial employment by the 
 78.13  municipality.  An employee electing to terminate participation 
 78.14  in the association is entitled to benefits that the employee 
 78.15  would be entitled to if terminating public employment and may 
 78.16  participate in a retirement program established by the private 
 78.17  vendor. 
 78.18     Sec. 3.  Laws 2004, chapter 267, article 12, section 4, is 
 78.19  amended to read:  
 78.20     Sec. 4.  [EFFECTIVE DATE.] 
 78.21     (a) Section 1, relating to the Fair Oaks Lodge, Wadena, is 
 78.22  effective upon the latter of: 
 78.23     (1) the day after the governing body of Todd County and its 
 78.24  chief clerical officer timely complete their compliance with 
 78.25  Minnesota Statutes, section 645.021, subdivisions 2 and 3; and 
 78.26     (2) the day after the governing body of Wadena County and 
 78.27  its chief clerical officer timely complete their compliance with 
 78.28  Minnesota Statutes, section 645.021, subdivisions 2 and 3. 
 78.29     (b) Section 1, relating to the RenVilla Nursing Home, is 
 78.30  effective upon the latter of: 
 78.31     (1) the day after the governing body of the city of 
 78.32  Renville and its chief clerical officer timely complete their 
 78.33  compliance with Minnesota Statutes, section 645.021, 
 78.34  subdivisions 2 and 3, except that the certificate of approval 
 78.35  must be filed before January 1, 2006; and 
 78.36     (2) the first day of the month next following certification 
 79.1   to the governing body of the city of Renville by the executive 
 79.2   director of the Public Employees Retirement Association that the 
 79.3   actuarial accrued liability of the special benefit coverage 
 79.4   proposed for extension to the privatized RenVilla Nursing Home 
 79.5   employees under section 1 does not exceed the actuarial gain 
 79.6   otherwise to be accrued by the Public Employees Retirement 
 79.7   Association, as calculated by the consulting actuary retained by 
 79.8   the Legislative Commission on Pensions and Retirement, or the 
 79.9   actuary retained under Minnesota Statutes, section 356.214, 
 79.10  whichever is applicable. 
 79.11     (c) The cost of the actuarial calculations must be borne by 
 79.12  the city of Renville or the purchaser of the RenVilla Nursing 
 79.13  Home. 
 79.14     (d) Section 1, relating to the St. Peter Community 
 79.15  Healthcare Center, is effective upon the latter of: 
 79.16     (1) the day after the governing body of the city of St. 
 79.17  Peter and its chief clerical officer timely complete their 
 79.18  compliance with Minnesota Statutes, section 645.021, 
 79.19  subdivisions 2 and 3; and 
 79.20     (2) the first day of the month next following certification 
 79.21  to the governing body of the city of St. Peter by the executive 
 79.22  director of the Public Employees Retirement Association that the 
 79.23  actuarial accrued liability of the special benefit coverage 
 79.24  proposed for extension to the privatized St. Peter Community 
 79.25  Healthcare Center employees under section 1 does not exceed the 
 79.26  actuarial gain otherwise to be accrued by the Public Employees 
 79.27  Retirement Association, as calculated by the consulting actuary 
 79.28  retained by the Legislative Commission on Pensions and 
 79.29  Retirement, or the actuary retained under Minnesota Statutes, 
 79.30  section 356.214, whichever is applicable. 
 79.31     (e) The cost of the actuarial calculations must be borne by 
 79.32  the city of St. Peter or the purchaser of the St. Peter 
 79.33  Community Healthcare Center. 
 79.34     (f) If the required actions under paragraphs (b) and (c) 
 79.35  occur, section 1 applies retroactively to the RenVilla Nursing 
 79.36  Home as of the date of privatization. 
 80.1      (g) If the required actions under paragraph (a) occur, 
 80.2   section 1 applies retroactively to Fair Oaks Lodge, Wadena, as 
 80.3   of January 1, 2004. 
 80.4      (h) Sections 2 and 3 are effective on the day following 
 80.5   final enactment. 
 80.6      Sec. 4.  [EFFECTIVE DATE.] 
 80.7      (a) Section 1, relating to Bridges Medical Services, is 
 80.8   effective upon the later of: 
 80.9      (1) the day after the governing body of the city of Ada and 
 80.10  its chief clerical officer timely complete their compliance with 
 80.11  Minnesota Statutes, section 645.021, subdivisions 2 and 3; and 
 80.12     (2) the first day of the month next following certification 
 80.13  to the governing body of the city of Ada by the executive 
 80.14  director of the Public Employees Retirement Association that the 
 80.15  actuarial accrued liability of the special benefit coverage 
 80.16  proposed for extension to the privatized Bridges Medical 
 80.17  Services employees under section 1 does not exceed the actuarial 
 80.18  gain otherwise to be accrued by the Public Employees Retirement 
 80.19  Association, as calculated by the consulting actuary retained 
 80.20  under Minnesota Statutes, section 356.214. 
 80.21     (b) Section 1, relating to the Hutchinson Area Health Care, 
 80.22  is effective upon the later of: 
 80.23     (1) the day after the governing body of the city of 
 80.24  Hutchinson and its chief clerical officer timely complete their 
 80.25  compliance with Minnesota Statutes, section 645.021, 
 80.26  subdivisions 2 and 3; and 
 80.27     (2) the first day of the month next following certification 
 80.28  to the governing body of the city of Hutchinson by the executive 
 80.29  director of the Public Employees Retirement Association that the 
 80.30  actuarial accrued liability of the special benefit coverage 
 80.31  proposed for extension to the privatized Hutchinson Area Health 
 80.32  Care employees under section 1 does not exceed the actuarial 
 80.33  gain otherwise to be accrued by the Public Employees Retirement 
 80.34  Association, as calculated by the consulting actuary retained by 
 80.35  the Legislative Commission on Pensions and Retirement. 
 80.36     (c) Section 1, relating to the Northfield Hospital, is 
 81.1   effective upon the later of: 
 81.2      (1) the day after the governing body of the city of 
 81.3   Northfield and its chief clerical officer timely complete their 
 81.4   compliance with Minnesota Statutes, section 645.021, 
 81.5   subdivisions 2 and 3; and 
 81.6      (2) the first day of the month next following certification 
 81.7   to the governing body of the city of Northfield by the executive 
 81.8   director of the Public Employees Retirement Association that the 
 81.9   actuarial accrued liability of the special benefit coverage 
 81.10  proposed for extension to the privatized Northfield Hospital 
 81.11  employees under section 1 does not exceed the actuarial gain 
 81.12  otherwise to be accrued by the Public Employees Retirement 
 81.13  Association, as calculated by the consulting actuary retained by 
 81.14  the Legislative Commission on Pensions and Retirement. 
 81.15     (d) The cost of the actuarial calculations must be borne by 
 81.16  the facility, the city in which the facility is located, or the 
 81.17  purchaser of the facility. 
 81.18     (e) If the required actions in paragraphs (a), (b), or (c) 
 81.19  and (d) occur, section 1 applies retroactively to the date of 
 81.20  privatization. 
 81.21     (f) Section 3 is effective the day following final 
 81.22  enactment. 
 81.23     (g) Section 2 is effective on the day following final 
 81.24  enactment and applies to privatizations occurring on or after 
 81.25  the effective date. 
 81.26                             ARTICLE 8
 81.27                      FIRST CLASS CITY TEACHER
 81.28                    RETIREMENT FUND ASSOCIATIONS
 81.29     Section 1.  Minnesota Statutes 2004, section 354A.021, is 
 81.30  amended by adding a subdivision to read: 
 81.31     Subd. 9.  [UPDATED ARTICLES OF INCORPORATION AND BYLAWS; 
 81.32  FILING.] (a) On or before July 1, 2006, and within six months of 
 81.33  the date of the approval of any amendment to the articles of 
 81.34  incorporation or bylaws, the chief administrative officer of 
 81.35  each first class city teacher retirement fund association shall 
 81.36  prepare and publish an updated compilation of the articles of 
 82.1   incorporation and the bylaws of the association. 
 82.2      (b) The chief administrative officer of the first class 
 82.3   city teacher retirement fund association must certify the 
 82.4   accuracy and the completeness of the compilation. 
 82.5      (c) The compilation of the articles of incorporation and 
 82.6   bylaws of a first class city teacher retirement fund association 
 82.7   must contain an index. 
 82.8      (d) The compilation must be made available to association 
 82.9   members and other interested parties.  The association may 
 82.10  charge a fee for a copy that reflects the price of printing or 
 82.11  otherwise producing the copy.  Two copies of the compilation 
 82.12  must be filed, without charge, by each retirement fund 
 82.13  association with the Legislation Commission on Pensions and 
 82.14  Retirement, the Legislative Reference Library, the state 
 82.15  auditor, the commissioner of education, the chancellor of the 
 82.16  Minnesota State Colleges and Universities system, and the 
 82.17  superintendent of the applicable school district. 
 82.18     (e) A first class city teacher retirement fund association 
 82.19  may contract with the revisor of statutes for the preparation of 
 82.20  the compilation. 
 82.21     (f) If a first class city teacher retirement fund 
 82.22  association makes an updated copy of its articles of 
 82.23  incorporation and bylaws available on its Web site, the 
 82.24  retirement fund association is not obligated to file a hard copy 
 82.25  of the documents under paragraph (d) for the applicable filing 
 82.26  period. 
 82.27     Sec. 2.  [EFFECTIVE DATE.] 
 82.28     Section 1 is effective July 1, 2005. 
 82.29                             ARTICLE 9
 82.30             MINNESOTA STATE COLLEGES AND UNIVERSITIES 
 82.31             INDIVIDUAL RETIREMENT ACCOUNT PLAN CHANGES 
 82.32     Section 1.  Minnesota Statutes 2004, section 354B.25, 
 82.33  subdivision 2, is amended to read: 
 82.34     Subd. 2.  [INVESTMENT OPTIONS.] (a) The plan administrator 
 82.35  shall arrange for the purchase of investment products. 
 82.36     (b) The investment products must be purchased with 
 83.1   contributions under section 354B.23 or with money or assets 
 83.2   otherwise provided by law by authority of the board.  
 83.3      (c) Various investment accounts offered through the 
 83.4   Minnesota supplemental investment fund established under section 
 83.5   11A.17 and administered by the State Board of Investment is one 
 83.6   of the may be included as investment products for the individual 
 83.7   retirement account plan.  Direct access must also be provided to 
 83.8   lower expense and no-load mutual funds, as those terms are 
 83.9   defined by the federal Securities and Exchange Commission, 
 83.10  including stock funds, bond funds, and balanced funds.  Other 
 83.11  investment products or combination of investment products which 
 83.12  may be included are: 
 83.13     (1) savings accounts at federally insured financial 
 83.14  institutions; 
 83.15     (2) life insurance contracts, fixed and variable annuity 
 83.16  contracts from companies that are subject to regulation by the 
 83.17  commerce commissioner; 
 83.18     (3) investment options from open-ended investment companies 
 83.19  registered under the federal Investment Company Act of 1940, 
 83.20  United States Code, title 15, sections 80a-1 to 80a-64; 
 83.21     (4) investment options from a firm that is a registered 
 83.22  investment advisor under the federal Investment Advisers Act of 
 83.23  1940, United States Code, title 15, sections 80b-1 to 80b-21; 
 83.24  and 
 83.25     (5) investment options of a bank as defined in United 
 83.26  States Code, title 15, section 80b-2, subsection (a), paragraph 
 83.27  2, or a bank holding company as defined in the Bank Holding 
 83.28  Company Act of 1956, United States Code, title 12, section 1841, 
 83.29  subsection (a), paragraph (1). 
 83.30     Sec. 2.  [EFFECTIVE DATE.] 
 83.31     Section 1 is effective the day following final enactment. 
 83.32                             ARTICLE 10
 83.33                   SUPPLEMENTAL RETIREMENT PLANS
 83.34     Section 1.  Minnesota Statutes 2004, section 356.24, 
 83.35  subdivision 1, is amended to read: 
 83.36     Subdivision 1.  [RESTRICTION; EXCEPTIONS.] It is unlawful 
 84.1   for a school district or other governmental subdivision or state 
 84.2   agency to levy taxes for, or to contribute public funds to a 
 84.3   supplemental pension or deferred compensation plan that is 
 84.4   established, maintained, and operated in addition to a primary 
 84.5   pension program for the benefit of the governmental subdivision 
 84.6   employees other than: 
 84.7      (1) to a supplemental pension plan that was established, 
 84.8   maintained, and operated before May 6, 1971; 
 84.9      (2) to a plan that provides solely for group health, 
 84.10  hospital, disability, or death benefits; 
 84.11     (3) to the individual retirement account plan established 
 84.12  by chapter 354B; 
 84.13     (4) to a plan that provides solely for severance pay under 
 84.14  section 465.72 to a retiring or terminating employee; 
 84.15     (5) for employees other than personnel employed by the 
 84.16  Board of Trustees of the Minnesota State Colleges and 
 84.17  Universities and covered under the Higher Education Supplemental 
 84.18  Retirement Plan under chapter 354C, if the supplemental plan 
 84.19  coverage is provided for in a personnel policy of the public 
 84.20  employer or in the collective bargaining agreement between the 
 84.21  public employer and the exclusive representative of public 
 84.22  employees in an appropriate unit, in an amount matching employee 
 84.23  contributions on a dollar for dollar basis, but not to exceed an 
 84.24  employer contribution of $2,000 a year per employee; 
 84.25     (i) to the state of Minnesota deferred compensation plan 
 84.26  under section 352.96; or 
 84.27     (ii) in payment of the applicable portion of the 
 84.28  contribution made to any investment eligible under section 
 84.29  403(b) of the Internal Revenue Code, if the employing unit has 
 84.30  complied with any applicable pension plan provisions of the 
 84.31  Internal Revenue Code with respect to the tax-sheltered annuity 
 84.32  program during the preceding calendar year; 
 84.33     (6) for personnel employed by the Board of Trustees of the 
 84.34  Minnesota State Colleges and Universities and not covered by 
 84.35  clause (5), to the supplemental retirement plan under chapter 
 84.36  354C, if the supplemental plan coverage is provided for in a 
 85.1   personnel policy or in the collective bargaining agreement of 
 85.2   the public employer with the exclusive representative of the 
 85.3   covered employees in an appropriate unit, in an amount matching 
 85.4   employee contributions on a dollar for dollar basis, but not to 
 85.5   exceed an employer contribution of $2,700 a year for each 
 85.6   employee; 
 85.7      (7) to a supplemental plan or to a governmental trust to 
 85.8   save for postretirement health care expenses qualified for 
 85.9   tax-preferred treatment under the Internal Revenue Code, if the 
 85.10  supplemental plan coverage is provided for in a personnel policy 
 85.11  or in the collective bargaining agreement of a public employer 
 85.12  with the exclusive representative of the covered employees in an 
 85.13  appropriate unit; 
 85.14     (8) to the laborer's national industrial pension fund or to 
 85.15  a laborer's local pension fund for the employees of a 
 85.16  governmental subdivision who are covered by a collective 
 85.17  bargaining agreement that provides for coverage by that fund and 
 85.18  that sets forth a fund contribution rate, but not to exceed an 
 85.19  employer contribution of $2,000 $5,000 per year per employee; 
 85.20     (9) to the plumbers' and pipefitters' national pension fund 
 85.21  or to a plumbers' and pipefitters' local pension fund for the 
 85.22  employees of a governmental subdivision who are covered by a 
 85.23  collective bargaining agreement that provides for coverage by 
 85.24  that fund and that sets forth a fund contribution rate, but not 
 85.25  to exceed an employer contribution of $2,000 $5,000 per year per 
 85.26  employee; 
 85.27     (10) to the international union of operating engineers 
 85.28  pension fund for the employees of a governmental subdivision who 
 85.29  are covered by a collective bargaining agreement that provides 
 85.30  for coverage by that fund and that sets forth a fund 
 85.31  contribution rate, but not to exceed an employer contribution of 
 85.32  $2,000 $5,000 per year per employee; or 
 85.33     (11) to a supplemental plan organized and operated under 
 85.34  the federal Internal Revenue Code, as amended, that is wholly 
 85.35  and solely funded by the employee's accumulated sick leave, 
 85.36  accumulated vacation leave, and accumulated severance pay at the 
 86.1   date of retirement or the termination of active employment. 
 86.2      Sec. 2.  [EFFECTIVE DATE.] 
 86.3      Section 1 is effective the day following final enactment. 
 86.4                              ARTICLE 11
 86.5                     VOLUNTEER FIREFIGHTER RELIEF
 86.6                         ASSOCIATION CHANGES
 86.7      Section 1.  Minnesota Statutes 2004, section 69.051, 
 86.8   subdivision 1, is amended to read: 
 86.9      Subdivision 1.  [FINANCIAL REPORT AND AUDIT.] The board of 
 86.10  each salaried firefighters relief association, police relief 
 86.11  association, and volunteer firefighters relief association as 
 86.12  defined in section 424A.001, subdivision 4, with assets of at 
 86.13  least $200,000 or liabilities of at least $200,000 in the prior 
 86.14  year or in any previous year, according to the most recent 
 86.15  applicable actuarial valuation or financial report if no 
 86.16  valuation is required, shall:  
 86.17     (1) prepare a financial report covering the special and 
 86.18  general funds of the relief association for the preceding fiscal 
 86.19  year on a form prescribed by the state auditor.  The financial 
 86.20  report shall must contain financial statements and disclosures 
 86.21  which present the true financial condition of the relief 
 86.22  association and the results of relief association operations in 
 86.23  conformity with generally accepted accounting principles and in 
 86.24  compliance with the regulatory, financing and funding provisions 
 86.25  of this chapter and any other applicable laws.  The financial 
 86.26  report shall must be countersigned by the municipal clerk or 
 86.27  clerk-treasurer of the municipality in which the relief 
 86.28  association is located if the relief association is a 
 86.29  firefighters relief association which is directly associated 
 86.30  with a municipal fire department or is a police relief 
 86.31  association, or countersigned by the secretary of the 
 86.32  independent nonprofit firefighting corporation and by the 
 86.33  municipal clerk or clerk-treasurer of the largest municipality 
 86.34  in population which contracts with the independent nonprofit 
 86.35  firefighting corporation if the volunteer firefighter relief 
 86.36  association is a subsidiary of an independent nonprofit 
 87.1   firefighting corporation; 
 87.2      (2) file the financial report in its office for public 
 87.3   inspection and present it to the city council after the close of 
 87.4   the fiscal year.  One copy of the financial report shall must be 
 87.5   furnished to the state auditor after the close of the fiscal 
 87.6   year; and 
 87.7      (3) submit to the state auditor audited financial 
 87.8   statements which have been attested to by a certified public 
 87.9   accountant, public accountant, or the state auditor within 180 
 87.10  days after the close of the fiscal year.  The state auditor may 
 87.11  accept this report in lieu of the report required in clause (2). 
 87.12     Sec. 2.  Minnesota Statutes 2004, section 69.051, 
 87.13  subdivision 1a, is amended to read: 
 87.14     Subd. 1a.  [FINANCIAL STATEMENT.] (a) The board of each 
 87.15  volunteer firefighters relief association, as defined in section 
 87.16  424A.001, subdivision 4, with assets of less than $200,000 and 
 87.17  liabilities less than $200,000, according to the most recent 
 87.18  financial report, shall that is not required to file a financial 
 87.19  report and audit under subdivision 1 must prepare a detailed 
 87.20  statement of the financial affairs for the preceding fiscal year 
 87.21  of the relief association's special and general funds in the 
 87.22  style and form prescribed by the state auditor.  The detailed 
 87.23  statement must show the sources and amounts of all money 
 87.24  received; all disbursements, accounts payable and accounts 
 87.25  receivable; the amount of money remaining in the treasury; total 
 87.26  assets including a listing of all investments; the accrued 
 87.27  liabilities; and all items necessary to show accurately the 
 87.28  revenues and expenditures and financial position of the relief 
 87.29  association. 
 87.30     (b) The detailed financial statement required under 
 87.31  paragraph (a) must be certified by an independent public 
 87.32  accountant or auditor or by the auditor or accountant who 
 87.33  regularly examines or audits the financial transactions of the 
 87.34  municipality.  In addition to certifying the financial condition 
 87.35  of the special and general funds of the relief association, the 
 87.36  accountant or auditor conducting the examination shall give an 
 88.1   opinion as to the condition of the special and general funds of 
 88.2   the relief association, and shall comment upon any exceptions to 
 88.3   the report.  The independent accountant or auditor shall must 
 88.4   have at least five years of public accounting, auditing, or 
 88.5   similar experience, and shall must not be an active, inactive, 
 88.6   or retired member of the relief association or the fire or 
 88.7   police department. 
 88.8      (c) The detailed statement required under paragraph (a) 
 88.9   must be countersigned by the municipal clerk or clerk-treasurer 
 88.10  of the municipality, or, where applicable, by the secretary of 
 88.11  the independent nonprofit firefighting corporation and by the 
 88.12  municipal clerk or clerk-treasurer of the largest municipality 
 88.13  in population which contracts with the independent nonprofit 
 88.14  firefighting corporation if the relief association is a 
 88.15  subsidiary of an independent nonprofit firefighting corporation. 
 88.16     (d) The volunteer firefighters' relief association board 
 88.17  must file the detailed statement required under paragraph (a) in 
 88.18  the relief association office for public inspection and present 
 88.19  it to the city council within 45 days after the close of the 
 88.20  fiscal year, and must submit a copy of the detailed statement to 
 88.21  the state auditor within 90 days of the close of the fiscal year.
 88.22     Sec. 3.  Minnesota Statutes 2004, section 69.771, is 
 88.23  amended to read: 
 88.24     69.771 [VOLUNTEER FIREFIGHTERS' RELIEF ASSOCIATION 
 88.25  FINANCING GUIDELINES ACT; APPLICATION.] 
 88.26     Subdivision 1.  [COVERED RELIEF ASSOCIATIONS.] The 
 88.27  applicable provisions of sections 69.771 to 69.776 shall apply 
 88.28  to any firefighters' relief association other than a relief 
 88.29  association enumerated in section 69.77, subdivision 1a, which 
 88.30  is organized under any laws of this state, which is composed of 
 88.31  volunteer firefighters or is composed partially of volunteer 
 88.32  firefighters and partially of salaried firefighters with 
 88.33  retirement coverage provided by the public employees police and 
 88.34  fire fund and which, in either case, operates subject to the 
 88.35  service pension minimum requirements for entitlement and 
 88.36  maximums contained in section 424A.02, or subject to a special 
 89.1   law modifying those requirements or maximums. 
 89.2      Subd. 2.  [AUTHORIZED EMPLOYER SUPPORT FOR A RELIEF 
 89.3   ASSOCIATION.] Notwithstanding any law to the contrary, a 
 89.4   municipality may lawfully contribute public funds, including the 
 89.5   transfer of any applicable fire state aid, or may levy property 
 89.6   taxes for the support of a firefighters' relief association 
 89.7   specified in subdivision 1, however organized, which provides 
 89.8   retirement coverage or pays a service pension to retired 
 89.9   firefighter or a retirement benefit to a disabled firefighter or 
 89.10  a surviving dependent of either an active or retired firefighter 
 89.11  for the operation and maintenance of the relief association only 
 89.12  if the municipality and the relief association both comply with 
 89.13  the applicable provisions of sections 69.771 to 69.776. 
 89.14     Subd. 3.  [REMEDY FOR NONCOMPLIANCE; DETERMINATION.] 
 89.15  Any (a) A municipality in which there exists a firefighters' 
 89.16  relief association as specified in subdivision 1 which does not 
 89.17  comply with the applicable provisions of sections 69.771 to 
 89.18  69.776 or the provisions of any applicable special law relating 
 89.19  to the funding or financing of the association shall does not 
 89.20  qualify initially to receive, or be and is not entitled 
 89.21  subsequently to retain, fire state aid pursuant to under 
 89.22  sections 69.011 to 69.051 until the reason for the 
 89.23  disqualification specified by the state auditor is remedied, 
 89.24  whereupon the municipality or relief association, if otherwise 
 89.25  qualified, shall be is entitled to again receive fire state aid 
 89.26  for the year occurring immediately subsequent to the year in 
 89.27  which the disqualification is remedied.  
 89.28     (b) The state auditor shall determine if a municipality to 
 89.29  which a firefighters' relief association is directly associated 
 89.30  or a firefighters' relief association fails to comply with the 
 89.31  provisions of sections 69.771 to 69.776 or the funding or 
 89.32  financing provisions of any applicable special law based upon 
 89.33  the information contained in the annual financial report of the 
 89.34  firefighters' relief association required pursuant to under 
 89.35  section 69.051., the actuarial valuation of the relief 
 89.36  association, if applicable, the relief association officers' 
 90.1   financial requirements of the relief association and minimum 
 90.2   municipal obligation determination documentation under section 
 90.3   69.772, subdivisions 3 and 4; 69.773, subdivisions 4 and 5; or 
 90.4   69.774, subdivision 2, if requested to be filed by the state 
 90.5   auditor, the applicable municipal or nonprofit firefighting 
 90.6   corporation budget, if requested to be filed by the state 
 90.7   auditor, and any other relevant documents or reports obtained by 
 90.8   the state auditor. 
 90.9      (c) The municipality or nonprofit firefighting corporation 
 90.10  and the associated relief association are not eligible to 
 90.11  receive or to retain fire state aid if: 
 90.12     (1) the relief association fails to prepare or to file the 
 90.13  financial report or financial statement under section 69.051; 
 90.14     (2) the relief association treasurer is not bonded in the 
 90.15  manner and in the amount required by section 69.051, subdivision 
 90.16  2; 
 90.17     (3) the relief association officers fail to determine or 
 90.18  improperly determine the accrued liability and the annual 
 90.19  accruing liability of the relief association under section 
 90.20  69.772, subdivisions 2, 2a, and 3, paragraph (c), clause (2), if 
 90.21  applicable; 
 90.22     (4) if applicable, the relief association officers fail to 
 90.23  obtain and file a required actuarial valuation or the officers 
 90.24  file an actuarial valuation that does not contain the special 
 90.25  fund actuarial liability calculated under the entry age normal 
 90.26  actuarial cost method, the special fund current assets, the 
 90.27  special fund unfunded actuarial accrued liability, the special 
 90.28  fund normal cost under the entry age normal actuarial cost 
 90.29  method, the amortization requirement for the special fund 
 90.30  unfunded actuarial accrued liability by the applicable target 
 90.31  date, a summary of the applicable benefit plan, a summary of the 
 90.32  membership of the relief association, a summary of the actuarial 
 90.33  assumptions used in preparing the valuation, and a signed 
 90.34  statement by the actuary attesting to its results and certifying 
 90.35  to the qualifications of the actuary as an approved actuary 
 90.36  under section 356.215, subdivision 1, paragraph (c); 
 91.1      (5) the municipality failed to provide a municipal 
 91.2   contribution, or the nonprofit firefighting corporation failed 
 91.3   to provide a corporate contribution, in the amount equal to the 
 91.4   minimum municipal obligation if the relief association is 
 91.5   governed under section 69.772, or the amount necessary, when 
 91.6   added to the fire state aid actually received in the plan year 
 91.7   in question, to at least equal in total the calculated annual 
 91.8   financial requirements of the special fund of the relief 
 91.9   association if the relief association is governed under section 
 91.10  69.773, and, if the municipal or corporate contribution is 
 91.11  deficient, the municipality failed to include the minimum 
 91.12  municipal obligation certified under section 69.772, subdivision 
 91.13  3, or 69.773, subdivision 5, in its budget and tax levy or the 
 91.14  nonprofit firefighting corporation failed to include the minimum 
 91.15  corporate obligation certified under section 69.774, subdivision 
 91.16  2, in the corporate budget; 
 91.17     (6) the relief association did not receive municipal 
 91.18  ratification for the most recent plan amendment when municipal 
 91.19  ratification was required under section 69.772, subdivision 6; 
 91.20  69.773, subdivision 6; or 424A.02, subdivision 10; 
 91.21     (7) the relief association invested special fund assets in 
 91.22  an investment security that is not authorized under section 
 91.23  69.775; 
 91.24     (8) the relief association had an administrative expense 
 91.25  that is not authorized under section 69.80 or 424A.05, 
 91.26  subdivision 3, or the municipality had an expenditure that is 
 91.27  not authorized under section 424A.08; 
 91.28     (9) the relief association officers fail to provide a 
 91.29  complete and accurate public pension plan investment portfolio 
 91.30  and performance disclosure under section 356.219; 
 91.31     (10) the relief association fails to obtain the 
 91.32  acknowledgment from a broker of the statement of investment 
 91.33  restrictions under section 356A.06, subdivision 8b; 
 91.34     (11) the relief association officers permitted to occur a 
 91.35  prohibited transaction under section 356A.06, subdivision 9, or 
 91.36  424A.001, subdivision 7, or failed to undertake correction of a 
 92.1   prohibited transaction that did occur; or 
 92.2      (12) the relief association pays a defined benefit service 
 92.3   pension in an amount that is in excess of the applicable service 
 92.4   pension maximum under section 424A.02, subdivision 3. 
 92.5      Sec. 4.  Minnesota Statutes 2004, section 69.772, 
 92.6   subdivision 3, is amended to read: 
 92.7      Subd. 3.  [FINANCIAL REQUIREMENTS OF RELIEF ASSOCIATION; 
 92.8   MINIMUM OBLIGATION OF MUNICIPALITY.] (a) During the month of 
 92.9   July, the officers of the relief association shall determine the 
 92.10  overall funding balance of the special fund for the current 
 92.11  calendar year, the financial requirements of the special fund 
 92.12  for the following calendar year and the minimum obligation of 
 92.13  the municipality with respect to the special fund for the 
 92.14  following calendar year in accordance with the requirements of 
 92.15  this subdivision.  
 92.16     (1) (b) The overall funding balance of the special fund for 
 92.17  the current calendar year shall must be determined in the 
 92.18  following manner: 
 92.19     (a) (1) The total accrued liability of the special fund for 
 92.20  all active and deferred members of the relief association as of 
 92.21  December 31 of the current year shall must be calculated 
 92.22  pursuant to under subdivisions 2 and 2a, if applicable. 
 92.23     (b) (2) The total present assets of the special fund 
 92.24  projected to December 31 of the current year, including receipts 
 92.25  by and disbursements from the special fund anticipated to occur 
 92.26  on or before December 31 shall, must be calculated.  To the 
 92.27  extent possible, for those assets for which a market value is 
 92.28  readily ascertainable, the current market value as of the date 
 92.29  of the calculation for those assets shall must be utilized in 
 92.30  making this calculation.  For any asset for which no market 
 92.31  value is readily ascertainable, the cost value or the book 
 92.32  value, whichever is applicable, shall must be utilized in making 
 92.33  this calculation. 
 92.34     (c) (3) The amount of the total present assets of the 
 92.35  special fund calculated pursuant to under clause (b) shall (2) 
 92.36  must be subtracted from the amount of the total accrued 
 93.1   liability of the special fund calculated pursuant to under 
 93.2   clause (a) (1).  If the amount of total present assets exceeds 
 93.3   the amount of the total accrued liability, then the special fund 
 93.4   shall be is considered to have a surplus over full funding.  If 
 93.5   the amount of the total present assets is less than the amount 
 93.6   of the total accrued liability, then the special fund shall be 
 93.7   is considered to have a deficit from full funding.  If the 
 93.8   amount of total present assets is equal to the amount of the 
 93.9   total accrued liability, then the special fund shall be is 
 93.10  considered to be fully funded. 
 93.11     (2) (c) The financial requirements of the special fund for 
 93.12  the following calendar year shall must be determined in the 
 93.13  following manner: 
 93.14     (a) (1) The total accrued liability of the special fund for 
 93.15  all active and deferred members of the relief association as of 
 93.16  December 31 of the calendar year next following the current 
 93.17  calendar year shall must be calculated pursuant to under 
 93.18  subdivisions 2 and 2a, if applicable. 
 93.19     (b) (2) The increase in the total accrued liability of the 
 93.20  special fund for the following calendar year over the total 
 93.21  accrued liability of the special fund for the current year shall 
 93.22  must be calculated. 
 93.23     (c) (3) The amount of anticipated future administrative 
 93.24  expenses of the special fund shall must be calculated by 
 93.25  multiplying the dollar amount of the administrative expenses of 
 93.26  the special fund for the most recent prior calendar year by the 
 93.27  factor of 1.035. 
 93.28     (d) (4) If the special fund is fully funded, the financial 
 93.29  requirement requirements of the special fund for the following 
 93.30  calendar year shall be are the figure which represents the 
 93.31  increase in the total accrued liability of the special fund as 
 93.32  amounts calculated pursuant to subclause (b) under clauses (2) 
 93.33  and (3).  
 93.34     (e) (5) If the special fund has a deficit from full 
 93.35  funding, the financial requirements of the special fund for the 
 93.36  following calendar year shall be are the financial requirements 
 94.1   of the special fund calculated as though the special fund were 
 94.2   fully funded pursuant to subclause (d) under clause (4) plus an 
 94.3   amount equal to one-tenth of the original amount of the deficit 
 94.4   from full funding of the special fund as determined pursuant to 
 94.5   this section for the calendar year 1971 until that deficit from 
 94.6   full funding is fully retired, and plus an amount equal to 
 94.7   one-tenth of the increase in the deficit from full funding of 
 94.8   the special fund under clause (2) resulting either from an 
 94.9   increase in the amount of the service pension accruing after 
 94.10  December 31, 1971 occurring in the last ten years or from a net 
 94.11  annual investment loss occurring during the last ten years until 
 94.12  each increase in the deficit from full funding is fully 
 94.13  retired.  The annual amortization contribution under this clause 
 94.14  may not exceed the amount of the deficit from full funding. 
 94.15     (f) (6) If the special fund has a surplus over full 
 94.16  funding, the financial requirements of the special fund for the 
 94.17  following calendar year shall be are the financial requirements 
 94.18  of the special fund calculated as though the special fund were 
 94.19  fully funded pursuant to subclause (d) under clause (4) reduced 
 94.20  by an amount equal to one-tenth of the amount of the surplus 
 94.21  over full funding of the special fund. 
 94.22     (3) (d) The minimum obligation of the municipality with 
 94.23  respect to the special fund shall be is the financial 
 94.24  requirements of the special fund reduced by the amount of any 
 94.25  fire state aid payable pursuant to under sections 69.011 to 
 94.26  69.051 reasonably anticipated to be received by the municipality 
 94.27  for transmittal to the special fund during the following 
 94.28  calendar year, an amount of interest on the assets of the 
 94.29  special fund projected to the beginning of the following 
 94.30  calendar year calculated at the rate of five percent per annum, 
 94.31  and the amount of any anticipated contributions to the special 
 94.32  fund required by the relief association bylaws from the active 
 94.33  members of the relief association reasonably anticipated to be 
 94.34  received during the following calendar year.  A reasonable 
 94.35  amount of anticipated fire state aid is an amount that does not 
 94.36  exceed the fire state aid actually received in the prior year 
 95.1   multiplied by the factor 1.035.  
 95.2      Sec. 5.  Minnesota Statutes 2004, section 69.772, 
 95.3   subdivision 4, is amended to read: 
 95.4      Subd. 4.  [CERTIFICATION OF FINANCIAL REQUIREMENTS AND 
 95.5   MINIMUM MUNICIPAL OBLIGATION; LEVY.] (a) The officers of the 
 95.6   relief association shall certify the financial requirements of 
 95.7   the special fund of the relief association and the minimum 
 95.8   obligation of the municipality with respect to the special fund 
 95.9   of the relief association as determined pursuant to under 
 95.10  subdivision 3 to the governing body of the municipality on or 
 95.11  before August 1 of each year.  The financial requirements of the 
 95.12  relief association and the minimum municipal obligation must be 
 95.13  included in the financial report or financial statement under 
 95.14  section 69.051.  
 95.15     (b) The municipality shall provide for at least the minimum 
 95.16  obligation of the municipality with respect to the special fund 
 95.17  of the relief association by tax levy or from any other source 
 95.18  of public revenue.  
 95.19     (c) The municipality may levy taxes for the payment of the 
 95.20  minimum municipal obligation without any limitation as to rate 
 95.21  or amount and irrespective of any limitations imposed by other 
 95.22  provisions of law upon the rate or amount of taxation until the 
 95.23  balance of the special fund or any fund of the relief 
 95.24  association has attained a specified level.  In addition, any 
 95.25  taxes levied pursuant to under this section shall must not cause 
 95.26  the amount or rate of any other taxes levied in that year or to 
 95.27  be levied in a subsequent year by the municipality which are 
 95.28  subject to a limitation as to rate or amount to be reduced.  
 95.29     (d) If the municipality does not include the full amount of 
 95.30  the minimum municipal obligations in its levy for any year, the 
 95.31  officers of the relief association shall certify that amount to 
 95.32  the county auditor, who shall spread a levy in the amount of the 
 95.33  certified minimum municipal obligation on the taxable property 
 95.34  of the municipality. 
 95.35     (e) If the state auditor determines that a municipal 
 95.36  contribution actually made in a plan year was insufficient under 
 96.1   section 69.771, subdivision 3, paragraph (c), clause (5), the 
 96.2   state auditor may request a copy of the certifications under 
 96.3   this subdivision from the relief association or from the city.  
 96.4   The relief association or the city, whichever applies, must 
 96.5   provide the certifications within 14 days of the date of the 
 96.6   request from the state auditor. 
 96.7      Sec. 6.  Minnesota Statutes 2004, section 69.773, 
 96.8   subdivision 4, is amended to read: 
 96.9      Subd. 4.  [FINANCIAL REQUIREMENTS OF SPECIAL FUND.] Prior 
 96.10  to (a) On or before August 1 of each year, the officers of the 
 96.11  relief association shall determine the financial requirements of 
 96.12  the special fund of the relief association in accordance with 
 96.13  the requirements of this subdivision.  
 96.14     (b) The financial requirements of the relief 
 96.15  association shall must be based on the most recent actuarial 
 96.16  valuation of the special fund prepared in accordance with 
 96.17  subdivision 2.  If the relief association has an unfunded 
 96.18  actuarial accrued liability as reported in the most recent 
 96.19  actuarial valuation, the financial requirements shall must be 
 96.20  determined by adding the figures calculated pursuant to under 
 96.21  paragraph (d), clauses (a) (1), (b) (2), and (c) (3).  If 
 96.22  the relief association does not have an unfunded actuarial 
 96.23  accrued liability as reported in the most recent actuarial 
 96.24  valuation, the financial requirements shall must be an amount 
 96.25  equal to the figure calculated pursuant to under paragraph (d), 
 96.26  clauses (a) (1) and (b) (2), reduced by an amount equal to 
 96.27  one-tenth of the amount of any assets in excess of the actuarial 
 96.28  accrued liability of the relief association.  
 96.29     (c) The determination of whether or not the relief 
 96.30  association has an unfunded actuarial accrued liability 
 96.31  shall must be based on the current market value of assets for 
 96.32  which a market value is readily ascertainable and the cost or 
 96.33  book value, whichever is applicable, for assets for which no 
 96.34  market value is readily ascertainable. 
 96.35     (a) (d) The components of the financial requirements of the 
 96.36  relief association are the following: 
 97.1      (1) The normal level cost requirement for the following 
 97.2   year, expressed as a dollar amount, shall be is the figure for 
 97.3   the normal level cost of the relief association as reported in 
 97.4   the actuarial valuation. 
 97.5      (b) (2) The amount of anticipated future administrative 
 97.6   expenses of the special fund shall must be calculated by 
 97.7   multiplying the dollar amount of the administrative expenses of 
 97.8   the special fund for the most recent prior calendar year by the 
 97.9   factor of 1.035. 
 97.10     (c) (3) The amortization contribution requirement to retire 
 97.11  the current unfunded actuarial accrued liability by the 
 97.12  established date for full funding shall be is the figure for the 
 97.13  amortization contribution as reported in the actuarial 
 97.14  valuation.  If there has not been a change in the actuarial 
 97.15  assumptions used for calculating the actuarial accrued liability 
 97.16  of the special fund, a change in the bylaws of the relief 
 97.17  association governing the service pensions, retirement benefits, 
 97.18  or both, payable from the special fund, or a change in the 
 97.19  actuarial cost method used to value all or a portion of the 
 97.20  special fund which change or changes, which by themselves, 
 97.21  without inclusion of any other items of increase or decrease, 
 97.22  produce a net increase in the unfunded actuarial accrued 
 97.23  liability of the special fund since December 31, 1970, the 
 97.24  established date for full funding shall be is the December 31, 
 97.25  1990 occurring ten years later.  If there has been a change in 
 97.26  the actuarial assumptions used for calculating the actuarial 
 97.27  accrued liability of the special fund, a change in the bylaws of 
 97.28  the relief association governing the service pensions, 
 97.29  retirement benefits, or both payable from the special fund or a 
 97.30  change in the actuarial cost method used to value all or a 
 97.31  portion of the special fund and the change or changes, by 
 97.32  themselves and without inclusion of any other items of increase 
 97.33  or decrease, produce a net increase in the unfunded actuarial 
 97.34  accrued liability of the special fund since December 31, 1970, 
 97.35  but prior to January 1, 1979 within the past 20 years, the 
 97.36  established date for full funding shall be December 31, 1998, 
 98.1   and if there has been a change since December 31, 1978, the 
 98.2   established date for full funding shall must be determined using 
 98.3   the following procedure:  
 98.4      (i) the unfunded actuarial accrued liability of the special 
 98.5   fund attributable to experience losses that have occurred since 
 98.6   the most recent prior actuarial valuation must be determined and 
 98.7   the level annual dollar contribution needed to amortize the 
 98.8   experience loss over a period of ten years ending on the 
 98.9   December 31 occurring ten years later must be calculated; 
 98.10     (ii) the unfunded actuarial accrued liability of the 
 98.11  special fund shall must be determined in accordance with the 
 98.12  provisions governing service pensions, retirement benefits, and 
 98.13  actuarial assumptions in effect before an applicable change; 
 98.14     (ii) (iii) the level annual dollar contribution needed to 
 98.15  amortize this unfunded actuarial accrued liability amount by the 
 98.16  date for full funding in effect prior to before the change shall 
 98.17  must be calculated using the interest assumption specified in 
 98.18  section 356.215, subdivision 8, in effect before any applicable 
 98.19  change; 
 98.20     (iii) (iv) the unfunded actuarial accrued liability of the 
 98.21  special fund shall must be determined in accordance with any new 
 98.22  provisions governing service pensions, retirement benefits, and 
 98.23  actuarial assumptions and the remaining provisions governing 
 98.24  service pensions, retirement benefits, and actuarial assumptions 
 98.25  in effect before an applicable change; 
 98.26     (iv) (v) the level annual dollar contribution needed to 
 98.27  amortize the difference between the unfunded actuarial accrued 
 98.28  liability amount calculated pursuant to subclause (i) under item 
 98.29  (ii) and the unfunded actuarial accrued liability amount 
 98.30  calculated pursuant to subclause (iii) under item (iv) over a 
 98.31  period of 20 years starting December 31 of the year in which the 
 98.32  change is effective shall must be calculated using the interest 
 98.33  assumption specified in section 356.215, subdivision 8, in 
 98.34  effect after any applicable change; 
 98.35     (v) (vi) the annual amortization contribution calculated 
 98.36  pursuant to subclause (iv) shall under item (v) must be added to 
 99.1   the annual amortization contribution calculated pursuant to 
 99.2   subclause (ii) under items (i) and (iii); 
 99.3      (vi) (vii) the period in which the unfunded actuarial 
 99.4   accrued liability amount determined in subclause (iii) item (iv) 
 99.5   will be amortized by the total annual amortization contribution 
 99.6   computed pursuant to subclause (v) shall under item (vi) must be 
 99.7   calculated using the interest assumption specified in section 
 99.8   356.215, subdivision 8, in effect after any applicable change, 
 99.9   rounded to the nearest integral number of years, but which shall 
 99.10  must not exceed a period of 20 years from the end of the year in 
 99.11  which the determination of the date for full funding using this 
 99.12  procedure is made and which shall must not be less than the 
 99.13  period of years beginning in the year in which the determination 
 99.14  of the date for full funding using this procedure is made and 
 99.15  ending by the date for full funding in effect before the change; 
 99.16     (vii) (viii) the period determined pursuant to subclause 
 99.17  (vi) shall under item (vii) must be added to the date as of 
 99.18  which the actuarial valuation was prepared and the resulting 
 99.19  date shall be is the new date for full funding. 
 99.20     Sec. 7.  Minnesota Statutes 2004, section 69.773, 
 99.21  subdivision 5, is amended to read: 
 99.22     Subd. 5.  [MINIMUM MUNICIPAL OBLIGATION.] (a) The officers 
 99.23  of the relief association shall determine the minimum obligation 
 99.24  of the municipality with respect to the special fund of the 
 99.25  relief association for the following calendar year prior to on 
 99.26  or before August 1 of each year in accordance with the 
 99.27  requirements of this subdivision.  
 99.28     (b) The minimum obligation of the municipality with respect 
 99.29  to the special fund shall be is an amount equal to the financial 
 99.30  requirements of the special fund of the relief association 
 99.31  determined pursuant to under subdivision 4, reduced by the 
 99.32  estimated amount of any fire state aid payable pursuant to under 
 99.33  sections 69.011 to 69.051 reasonably anticipated to be received 
 99.34  by the municipality for transmittal to the special fund of the 
 99.35  relief association during the following year and the amount of 
 99.36  any anticipated contributions to the special fund required by 
100.1   the relief association bylaws from the active members of the 
100.2   relief association reasonably anticipated to be received during 
100.3   the following calendar year.  A reasonable amount of anticipated 
100.4   fire state aid is an amount that does not exceed the fire state 
100.5   aid actually received in the prior year multiplied by the factor 
100.6   1.035. 
100.7      (c) The officers of the relief association shall certify 
100.8   the financial requirements of the special fund of the relief 
100.9   association and the minimum obligation of the municipality with 
100.10  respect to the special fund of the relief association as 
100.11  determined pursuant to under subdivision 4 and this subdivision 
100.12  to the governing body of the municipality by August 1 of each 
100.13  year.  The financial requirements of the relief association and 
100.14  the minimum municipal obligation must be included in the 
100.15  financial report or financial statement under section 69.051.  
100.16     (d) The municipality shall provide for at least the minimum 
100.17  obligation of the municipality with respect to the special fund 
100.18  of the relief association by tax levy or from any other source 
100.19  of public revenue.  The municipality may levy taxes for the 
100.20  payment of the minimum municipal obligation without any 
100.21  limitation as to rate or amount and irrespective of any 
100.22  limitations imposed by other provisions of law or charter upon 
100.23  the rate or amount of taxation until the balance of the special 
100.24  fund or any fund of the relief association has attained a 
100.25  specified level.  In addition, any taxes levied pursuant to 
100.26  under this section shall must not cause the amount or rate of 
100.27  any other taxes levied in that year or to be levied in a 
100.28  subsequent year by the municipality which are subject to a 
100.29  limitation as to rate or amount to be reduced.  
100.30     (e) If the municipality does not include the full amount of 
100.31  the minimum municipal obligation in its levy for any year, the 
100.32  officers of the relief association shall certify that amount to 
100.33  the county auditor, who shall spread a levy in the amount of the 
100.34  minimum municipal obligation on the taxable property of the 
100.35  municipality. 
100.36     (f) If the state auditor determines that a municipal 
101.1   contribution actually made in a plan year was insufficient under 
101.2   section 69.771, subdivision 3, paragraph (c), clause (5), the 
101.3   state auditor may request from the relief association or from 
101.4   the city a copy of the certifications under this subdivision.  
101.5   The relief association or the city, whichever applies, must 
101.6   provide the certifications within 14 days of the date of the 
101.7   request from the state auditor. 
101.8      Sec. 8.  Minnesota Statutes 2004, section 69.775, is 
101.9   amended to read: 
101.10     69.775 [INVESTMENTS.] 
101.11     (a) The special fund assets of the a relief associations 
101.12  association governed by sections 69.771 to 69.776 must be 
101.13  invested in securities that are authorized investments under 
101.14  section 356A.06, subdivision 6 or 7.  
101.15     (b) Notwithstanding the foregoing, up to 75 percent of the 
101.16  market value of the assets of the special fund, not including 
101.17  any money market mutual funds, may be invested in open-end 
101.18  investment companies registered under the federal Investment 
101.19  Company Act of 1940, if the portfolio investments of the 
101.20  investment companies comply with the type of securities 
101.21  authorized for investment under section 356A.06, subdivision 7.  
101.22     (c) Securities held by the associations before June 2, 
101.23  1989, that do not meet the requirements of this section may be 
101.24  retained after that date if they were proper investments for the 
101.25  association on that date.  
101.26     (d) The governing board of the association may select and 
101.27  appoint investment agencies to act for and in its behalf or may 
101.28  certify special fund assets for investment by the State Board of 
101.29  Investment under section 11A.17.  
101.30     (e) The governing board of the association may certify 
101.31  general fund assets of the relief association for investment by 
101.32  the State Board of Investment in fixed income pools or in a 
101.33  separately managed account at the discretion of the State Board 
101.34  of Investment as provided in section 11A.14.  
101.35     (f) The governing board of the association may select and 
101.36  appoint a qualified private firm to measure management 
102.1   performance and return on investment, and the firm shall use the 
102.2   formula or formulas developed by the state board under section 
102.3   11A.04, clause (11). 
102.4      Sec. 9.  Minnesota Statutes 2004, section 356A.06, 
102.5   subdivision 7, is amended to read: 
102.6      Subd. 7.  [EXPANDED LIST OF AUTHORIZED INVESTMENT 
102.7   SECURITIES.] (a)  [AUTHORITY.] Except to the extent otherwise 
102.8   authorized by law or bylaws, a covered pension plan not 
102.9   described by subdivision 6, paragraph (a), may invest its assets 
102.10  only in accordance with this subdivision. 
102.11     (b)  [SECURITIES GENERALLY.] The covered pension plan has 
102.12  the authority to purchase, sell, lend, or exchange the 
102.13  securities specified in paragraphs (c) to (g) (h), including 
102.14  puts and call options and future contracts traded on a contract 
102.15  market regulated by a governmental agency or by a financial 
102.16  institution regulated by a governmental agency.  These 
102.17  securities may be owned as units in commingled trusts that own 
102.18  the securities described in paragraphs (c) to (g) (h).  
102.19     (c)  [GOVERNMENT OBLIGATIONS.] The covered pension plan may 
102.20  invest funds in governmental bonds, notes, bills, mortgages, and 
102.21  other evidences of indebtedness provided the issue is backed by 
102.22  the full faith and credit of the issuer or the issue is rated 
102.23  among the top four quality rating categories by a nationally 
102.24  recognized rating agency.  The obligations in which funds may be 
102.25  invested under this paragraph include guaranteed or insured 
102.26  issues of (1) the United States, its agencies, its 
102.27  instrumentalities, or organizations created and regulated by an 
102.28  act of Congress; (2) Canada and its provinces, provided the 
102.29  principal and interest is payable in United States dollars; (3) 
102.30  the states and their municipalities, political subdivisions, 
102.31  agencies, or instrumentalities; (4) the International Bank for 
102.32  Reconstruction and Development, the Inter-American Development 
102.33  Bank, the Asian Development Bank, the African Development Bank, 
102.34  or any other United States government sponsored organization of 
102.35  which the United States is a member, provided the principal and 
102.36  interest is payable in United States dollars. 
103.1      (d)  [CORPORATE OBLIGATIONS.] The covered pension plan may 
103.2   invest funds in bonds, notes, debentures, transportation 
103.3   equipment obligations, or any other longer term evidences of 
103.4   indebtedness issued or guaranteed by a corporation organized 
103.5   under the laws of the United States or any state thereof, or the 
103.6   Dominion of Canada or any province thereof if they conform to 
103.7   the following provisions: 
103.8      (1) the principal and interest of obligations of 
103.9   corporations incorporated or organized under the laws of the 
103.10  Dominion of Canada or any province thereof must be payable in 
103.11  United States dollars; and 
103.12     (2) obligations must be rated among the top four quality 
103.13  categories by a nationally recognized rating agency. 
103.14     (e)  [OTHER OBLIGATIONS.] (1) The covered pension plan may 
103.15  invest funds in bankers acceptances, certificates of deposit, 
103.16  deposit notes, commercial paper, mortgage participation 
103.17  certificates and pools, asset backed securities, repurchase 
103.18  agreements and reverse repurchase agreements, guaranteed 
103.19  investment contracts, savings accounts, and guaranty fund 
103.20  certificates, surplus notes, or debentures of domestic mutual 
103.21  insurance companies if they conform to the following provisions: 
103.22     (i) bankers acceptances and deposit notes of United States 
103.23  banks are limited to those issued by banks rated in the highest 
103.24  four quality categories by a nationally recognized rating 
103.25  agency; 
103.26     (ii) certificates of deposit are limited to those issued by 
103.27  (A) United States banks and savings institutions that are rated 
103.28  in the highest four quality categories by a nationally 
103.29  recognized rating agency or whose certificates of deposit are 
103.30  fully insured by federal agencies; or (B) credit unions in 
103.31  amounts up to the limit of insurance coverage provided by the 
103.32  National Credit Union Administration; 
103.33     (iii) commercial paper is limited to those issued by United 
103.34  States corporations or their Canadian subsidiaries and rated in 
103.35  the highest two quality categories by a nationally recognized 
103.36  rating agency; 
104.1      (iv) mortgage participation or pass through certificates 
104.2   evidencing interests in pools of first mortgages or trust deeds 
104.3   on improved real estate located in the United States where the 
104.4   loan to value ratio for each loan as calculated in accordance 
104.5   with section 61A.28, subdivision 3, does not exceed 80 percent 
104.6   for fully amortizable residential properties and in all other 
104.7   respects meets the requirements of section 61A.28, subdivision 
104.8   3; 
104.9      (v) collateral for repurchase agreements and reverse 
104.10  repurchase agreements is limited to letters of credit and 
104.11  securities authorized in this section; 
104.12     (vi) guaranteed investment contracts are limited to those 
104.13  issued by insurance companies or banks rated in the top four 
104.14  quality categories by a nationally recognized rating agency or 
104.15  to alternative guaranteed investment contracts where the 
104.16  underlying assets comply with the requirements of this 
104.17  subdivision; 
104.18     (vii) savings accounts are limited to those fully insured 
104.19  by federal agencies; and 
104.20     (viii) asset backed securities must be rated in the top 
104.21  four quality categories by a nationally recognized rating agency.
104.22     (2) Sections 16A.58, 16C.03, subdivision 4, and 16C.05 do 
104.23  not apply to certificates of deposit and collateralization 
104.24  agreements executed by the covered pension plan under clause 
104.25  (1), item (ii). 
104.26     (3) In addition to investments authorized by clause (1), 
104.27  item (iv), the covered pension plan may purchase from the 
104.28  Minnesota Housing Finance Agency all or any part of a pool of 
104.29  residential mortgages, not in default, that has previously been 
104.30  financed by the issuance of bonds or notes of the agency.  The 
104.31  covered pension plan may also enter into a commitment with the 
104.32  agency, at the time of any issue of bonds or notes, to purchase 
104.33  at a specified future date, not exceeding 12 years from the date 
104.34  of the issue, the amount of mortgage loans then outstanding and 
104.35  not in default that have been made or purchased from the 
104.36  proceeds of the bonds or notes.  The covered pension plan may 
105.1   charge reasonable fees for any such commitment and may agree to 
105.2   purchase the mortgage loans at a price sufficient to produce a 
105.3   yield to the covered pension plan comparable, in its judgment, 
105.4   to the yield available on similar mortgage loans at the date of 
105.5   the bonds or notes.  The covered pension plan may also enter 
105.6   into agreements with the agency for the investment of any 
105.7   portion of the funds of the agency.  The agreement must cover 
105.8   the period of the investment, withdrawal privileges, and any 
105.9   guaranteed rate of return. 
105.10     (f)  [CORPORATE STOCKS.] The covered pension plan may 
105.11  invest funds in stocks or convertible issues of any corporation 
105.12  organized under the laws of the United States or the states 
105.13  thereof, any corporation organized under the laws of the 
105.14  Dominion of Canada or its provinces, or any corporation listed 
105.15  on the New York Stock Exchange or the American Stock Exchange an 
105.16  exchange regulated by an agency of the United States or of the 
105.17  Canadian national government, if they conform to the following 
105.18  provisions: 
105.19     (1) the aggregate value of corporate stock investments, as 
105.20  adjusted for realized profits and losses, must not exceed 85 
105.21  percent of the market or book value, whichever is less, of a 
105.22  fund, less the aggregate value of investments according to 
105.23  subdivision 6 paragraph (h); 
105.24     (2) investments must not exceed five percent of the total 
105.25  outstanding shares of any one corporation. 
105.26     (g)  [EXCHANGE TRADED FUNDS.] The covered pension plan may 
105.27  invest funds in exchange traded funds, subject to the maximums, 
105.28  the requirements, and the limitations set forth in paragraph 
105.29  (d), (e), (f), or (h), whichever applies. 
105.30     (h)  [OTHER INVESTMENTS.] (1) In addition to the 
105.31  investments authorized in paragraphs (b) to (f) (g), and subject 
105.32  to the provisions in clause (2), the covered pension plan may 
105.33  invest funds in:  
105.34     (i) venture capital investment businesses through 
105.35  participation in limited partnerships and corporations; 
105.36     (ii) real estate ownership interests or loans secured by 
106.1   mortgages or deeds of trust through investment in limited 
106.2   partnerships, bank sponsored collective funds, trusts, and 
106.3   insurance company commingled accounts, including separate 
106.4   accounts; 
106.5      (iii) regional and mutual funds through bank sponsored 
106.6   collective funds and open-end investment companies registered 
106.7   under the Federal Investment Company Act of 1940; 
106.8      (iv) resource investments through limited partnerships, 
106.9   private placements, and corporations; and 
106.10     (v) international securities. 
106.11     (2) The investments authorized in clause (1) must conform 
106.12  to the following provisions:  
106.13     (i) the aggregate value of all investments made according 
106.14  to clause (1) may not exceed 35 percent of the market value of 
106.15  the fund for which the covered pension plan is investing; 
106.16     (ii) there must be at least four unrelated owners of the 
106.17  investment other than the state board covered pension plan for 
106.18  investments made under clause (1), item (i), (ii), (iii), or 
106.19  (iv); 
106.20     (iii) covered pension plan participation in an investment 
106.21  vehicle is limited to 20 percent thereof for investments made 
106.22  under clause (1), item (i), (ii), (iii), or (iv); and 
106.23     (iv) covered pension plan participation in a limited 
106.24  partnership does not include a general partnership interest or 
106.25  other interest involving general liability.  The covered pension 
106.26  plan may not engage in any activity as a limited partner which 
106.27  creates general liability. 
106.28     Sec. 10.  Minnesota Statutes 2004, section 424A.02, 
106.29  subdivision 3, is amended to read: 
106.30     Subd. 3.  [FLEXIBLE SERVICE PENSION MAXIMUMS.] (a) Annually 
106.31  on or before August 1 as part of the certification of the 
106.32  financial requirements and minimum municipal obligation 
106.33  determined under section 69.772, subdivision 4, or 69.773, 
106.34  subdivision 5, as applicable, the secretary or some other 
106.35  official of the relief association designated in the bylaws of 
106.36  each relief association shall calculate and certify to the 
107.1   governing body of the applicable qualified municipality the 
107.2   average amount of available financing per active covered 
107.3   firefighter for the most recent three-year period.  The amount 
107.4   of available financing shall include any amounts of fire state 
107.5   aid received or receivable by the relief association, any 
107.6   amounts of municipal contributions to the relief association 
107.7   raised from levies on real estate or from other available 
107.8   revenue sources exclusive of fire state aid, and one-tenth of 
107.9   the amount of assets in excess of the accrued liabilities of the 
107.10  relief association calculated under section 69.772, subdivision 
107.11  2; 69.773, subdivisions 2 and 4; or 69.774, subdivision 2, if 
107.12  any.  
107.13     (b) The maximum service pension which the relief 
107.14  association has authority to provide for in its bylaws for 
107.15  payment to a member retiring after the calculation date when the 
107.16  minimum age and service requirements specified in subdivision 1 
107.17  are met must be determined using the table in paragraph (c) or 
107.18  (d), whichever applies. 
107.19     (c) For a relief association where the governing bylaws 
107.20  provide for a monthly service pension to a retiring member, the 
107.21  maximum monthly service pension amount per month for each year 
107.22  of service credited that may be provided for in the bylaws is 
107.23  the greater of the service pension amount provided for in the 
107.24  bylaws on the date of the calculation of the average amount of 
107.25  the available financing per active covered firefighter or the 
107.26  maximum service pension figure corresponding to the average 
107.27  amount of available financing per active covered firefighter: 
107.28    Minimum Average Amount of      Maximum Service Pension
107.29    Available Financing per        Amount Payable per Month
107.30         Firefighter               for Each Year of Service
107.31           $...                            $  .25
107.32             42   41                          .50
107.33             84   81                         1.00
107.34            126  122                         1.50
107.35            168  162                         2.00
107.36            209  203                         2.50
108.1             252  243                         3.00
108.2             294  284                         3.50
108.3             335  324                         4.00
108.4             378  365                         4.50
108.5             420  405                         5.00
108.6             503  486                         6.00
108.7             587  567                         7.00
108.8             672  648                         8.00
108.9             755  729                         9.00
108.10            839  810                        10.00
108.11            923  891                        11.00
108.12           1007  972                        12.00
108.13           1090 1053                        13.00
108.14           1175 1134                        14.00
108.15           1259 1215                        15.00
108.16           1342 1296                        16.00
108.17           1427 1377                        17.00
108.18           1510 1458                        18.00
108.19           1594 1539                        19.00
108.20           1677 1620                        20.00
108.21           1762 1701                        21.00
108.22           1845 1782                        22.00
108.23           1888 1823                        22.50
108.24           1929 1863                        23.00
108.25           2014 1944                        24.00
108.26           2098 2025                        25.00
108.27           2183 2106                        26.00
108.28           2267 2187                        27.00
108.29           2351 2268                        28.00
108.30           2436 2349                        29.00
108.31           2520 2430                        30.00
108.32           2604 2511                        31.00
108.33           2689 2592                        32.00
108.34           2773 2673                        33.00
108.35           2857 2754                        34.00
108.36           2942 2834                        35.00
109.1            3026 2916                        36.00
109.2            3110 2997                        37.00
109.3            3194 3078                        38.00
109.4            3278 3159                        39.00
109.5            3362 3240                        40.00
109.6            3446 3321                        41.00
109.7            3530 3402                        42.00
109.8            3614 3483                        43.00
109.9            3698 3564                        44.00
109.10           3782 3645                        45.00
109.11           3866 3726                        46.00
109.12           3950 3807                        47.00
109.13           4034 3888                        48.00
109.14           4118 3969                        49.00
109.15           4202 4050                        50.00
109.16           4286 4131                        51.00
109.17           4370 4212                        52.00
109.18     Effective beginning December 31, 2003: 
109.19           4454 4293                        53.00
109.20           4538 4374                        54.00
109.21           4622 4455                        55.00
109.22           4706 4536                        56.00
109.23     (d) For a relief association in which the governing bylaws 
109.24  provide for a lump sum service pension to a retiring member, the 
109.25  maximum lump sum service pension amount for each year of service 
109.26  credited that may be provided for in the bylaws is the greater 
109.27  of the service pension amount provided for in the bylaws on the 
109.28  date of the calculation of the average amount of the available 
109.29  financing per active covered firefighter or the maximum service 
109.30  pension figure corresponding to the average amount of available 
109.31  financing per active covered firefighter for the applicable 
109.32  specified period: 
109.33   Minimum Average Amount         Maximum Lump Sum Service
109.34   of Available Financing         Pension Amount Payable
109.35      per Firefighter             for Each Year of Service
109.36          $..                              $10
110.1            11                               20
110.2            16                               30
110.3            23                               40
110.4            27                               50
110.5            32                               60
110.6            43                               80
110.7            54                              100
110.8            65                              120
110.9            77                              140
110.10           86                              160
110.11           97                              180
110.12          108                              200
110.13          131                              240
110.14          151                              280
110.15          173                              320
110.16          194                              360
110.17          216                              400
110.18          239                              440
110.19          259                              480
110.20          281                              520
110.21          302                              560
110.22          324                              600
110.23          347                              640
110.24          367                              680
110.25          389                              720
110.26          410                              760
110.27          432                              800
110.28          486                              900
110.29          540                             1000
110.30          594                             1100
110.31          648                             1200
110.32          702                             1300
110.33          756                             1400
110.34          810                             1500
110.35          864                             1600
110.36          918                             1700
111.1           972                             1800
111.2          1026                             1900
111.3          1080                             2000
111.4          1134                             2100
111.5          1188                             2200
111.6          1242                             2300
111.7          1296                             2400
111.8          1350                             2500
111.9          1404                             2600
111.10         1458                             2700
111.11         1512                             2800
111.12         1566                             2900
111.13         1620                             3000
111.14         1672                             3100
111.15         1726                             3200
111.16         1753                             3250
111.17         1780                             3300
111.18         1820                             3375
111.19         1834                             3400
111.20         1888                             3500
111.21         1942                             3600
111.22         1996                             3700
111.23         2023                             3750
111.24         2050                             3800
111.25         2104                             3900
111.26         2158                             4000
111.27         2212                             4100
111.28         2265                             4200
111.29         2319                             4300
111.30         2373                             4400
111.31         2427                             4500
111.32         2481                             4600
111.33         2535                             4700
111.34         2589                             4800
111.35         2643                             4900
111.36         2697                             5000
112.1          2751                             5100
112.2          2805                             5200
112.3          2859                             5300
112.4          2913                             5400
112.5          2967                             5500
112.6          3021                             5600
112.7          3075                             5700
112.8          3129                             5800
112.9          3183                             5900
112.10         3237                             6000
112.11         3291                             6100
112.12         3345                             6200
112.13         3399                             6300
112.14         3453                             6400
112.15         3507                             6500
112.16         3561                             6600
112.17         3615                             6700
112.18         3669                             6800
112.19         3723                             6900
112.20         3777                             7000
112.21     Effective beginning December 31, 2003: 
112.22         3831                             7100
112.23         3885                             7200
112.24         3939                             7300
112.25         3993                             7400
112.26         4047                             7500
112.27     (e) For a relief association in which the governing bylaws 
112.28  provide for a monthly benefit service pension as an alternative 
112.29  form of service pension payment to a lump sum service pension, 
112.30  the maximum service pension amount for each pension payment type 
112.31  must be determined using the applicable table contained in this 
112.32  subdivision. 
112.33     (f) If a relief association establishes a service pension 
112.34  in compliance with the applicable maximum contained in paragraph 
112.35  (c) or (d) and the minimum average amount of available financing 
112.36  per active covered firefighter is subsequently reduced because 
113.1   of a reduction in fire state aid or because of an increase in 
113.2   the number of active firefighters, the relief association may 
113.3   continue to provide the prior service pension amount specified 
113.4   in its bylaws, but may not increase the service pension amount 
113.5   until the minimum average amount of available financing per 
113.6   firefighter under the table in paragraph (c) or (d), whichever 
113.7   applies, permits. 
113.8      (g) No relief association is authorized to provide a 
113.9   service pension in an amount greater than the largest applicable 
113.10  flexible service pension maximum amount even if the amount of 
113.11  available financing per firefighter is greater than the 
113.12  financing amount associated with the largest applicable flexible 
113.13  service pension maximum. 
113.14     Sec. 11.  Minnesota Statutes 2004, section 424A.02, 
113.15  subdivision 4, is amended to read: 
113.16     Subd. 4.  [DEFINED CONTRIBUTION LUMP SUM SERVICE 
113.17  PENSIONS.] (a) If the bylaws governing the relief association so 
113.18  provide exclusively, the relief association may pay a defined 
113.19  contribution lump sum service pension in lieu of any defined 
113.20  benefit service pension governed by subdivision 2.  
113.21     (b) An individual account for each firefighter who is a 
113.22  member of the relief association shall must be established.  To 
113.23  each individual active member account shall must be credited a 
113.24  right to an equal share of:  (a) (1) any amounts of fire state 
113.25  aid received by the relief association; (b) (2) any amounts of 
113.26  municipal contributions to the relief association raised from 
113.27  levies on real estate or from other available revenue sources 
113.28  exclusive of fire state aid; and (c) (3) any amounts equal to 
113.29  the share of the assets of the special fund to the credit 
113.30  of:  (1) (i) any former member who terminated active service 
113.31  with the fire department to which the relief association is 
113.32  associated prior to before meeting the minimum service 
113.33  requirement provided for in subdivision 1 and has not returned 
113.34  to active service with the fire department for a period no 
113.35  shorter than five years; or (2) (ii) any retired member who 
113.36  retired prior to before obtaining a full nonforfeitable interest 
114.1   in the amounts credited to the individual member 
114.2   account pursuant to under subdivision 2 and any applicable 
114.3   provision of the bylaws of the relief association.  In addition, 
114.4   any interest or investment income earned return on the assets of 
114.5   the special fund shall must be credited in proportion to the 
114.6   share of the assets of the special fund to the credit of each 
114.7   individual active member account through the date on which the 
114.8   investment return is recognized by and credited to the special 
114.9   fund.  
114.10     (c) At the time of retirement pursuant to under subdivision 
114.11  1 and any applicable provision of the bylaws of the relief 
114.12  association, a retiring member shall be is entitled to that 
114.13  portion of the assets of the special fund to the credit of the 
114.14  member in the individual member account which is 
114.15  nonforfeitable pursuant to under subdivision 2 and any 
114.16  applicable provision of the bylaws of the relief association 
114.17  based on the number of years of service to the credit of the 
114.18  retiring member.  
114.19     Sec. 12.  Minnesota Statutes 2004, section 424A.02, 
114.20  subdivision 7, is amended to read: 
114.21     Subd. 7.  [DEFERRED SERVICE PENSIONS.] (a) A member of a 
114.22  relief association to which this section applies is entitled to 
114.23  a deferred service pension if the member: 
114.24     (1) has completed the lesser of the minimum period of 
114.25  active service with the fire department specified in the bylaws 
114.26  or 20 years of active service with the fire department; 
114.27     (2) has completed at least five years of active membership 
114.28  in the relief association; and 
114.29     (3) separates from active service and membership before 
114.30  reaching age 50 or the minimum age for retirement and 
114.31  commencement of a service pension specified in the bylaws 
114.32  governing the relief association if that age is greater than age 
114.33  50.  
114.34     (b) The deferred service pension starts is payable when the 
114.35  former member reaches age 50, or the minimum age specified in 
114.36  the bylaws governing the relief association if that age is 
115.1   greater than age 50, and when the former member makes a valid 
115.2   written application. 
115.3      (c) A relief association that provides a lump sum service 
115.4   pension governed by subdivision 3 may, when its governing bylaws 
115.5   so provide, pay interest on the deferred lump sum service 
115.6   pension during the period of deferral.  If provided for in the 
115.7   bylaws, interest must be paid in one of the following manners: 
115.8      (1) at the investment performance rate actually earned on 
115.9   that portion of the assets if the deferred benefit amount is 
115.10  invested by the relief association in a separate account 
115.11  established and maintained by the relief association or if the 
115.12  deferred benefit amount is invested in a separate investment 
115.13  vehicle held by the relief association; 
115.14     (2) at the an interest rate of up to five percent, 
115.15  compounded annually, as set by the board of directors and 
115.16  approved as provided in subdivision 10; or 
115.17     (3) at a rate equal to the actual time weighted total rate 
115.18  of return investment performance of the special fund as reported 
115.19  by the Office of the State Auditor under section 356.219, up to 
115.20  five percent, compounded annually, and applied consistently for 
115.21  all deferred service pensioners. 
115.22     (d) A relief association may not use the method provided 
115.23  for in paragraph (c), clause (3), until it has modified its 
115.24  bylaws to be consistent with that clause. 
115.25     (d) Interest under paragraph (c), clause (2) or (3), is 
115.26  payable from the first day of the month next following the date 
115.27  on which the municipality has approved the deferred service 
115.28  pension interest rate established by the board of trustees or 
115.29  from the first day of the month next following the date on which 
115.30  the member separated from active fire department service and 
115.31  relief association membership, whichever is later, to the last 
115.32  day of the month immediately before the month in which the 
115.33  deferred member becomes eligible to begin receipt of the service 
115.34  pension and applies for the deferred service pension.  
115.35     (e) A relief association that provides a defined 
115.36  contribution service pension may, if its governing bylaws so 
116.1   provide, credit interest or additional investment performance on 
116.2   the deferred lump sum service pension during the period of 
116.3   deferral.  If provided for in the bylaws, the interest must be 
116.4   paid in one of the manners specified in paragraph (c) or 
116.5   alternatively the relief association may credit any investment 
116.6   return on the assets of the special fund of the defined 
116.7   contribution volunteer firefighter relief association in 
116.8   proportion to the share of the assets of the special fund to the 
116.9   credit of each individual deferred member account through the 
116.10  date on which the investment return is recognized by and 
116.11  credited to the special fund.  
116.12     (f) For a deferred service pension that is transferred to a 
116.13  separate account established and maintained by the relief 
116.14  association or separate investment vehicle held by the relief 
116.15  association, the deferred member bears the full investment risk 
116.16  subsequent to transfer and in calculating the accrued liability 
116.17  of the volunteer firefighters relief association that pays a 
116.18  lump sum service pension, the accrued liability for deferred 
116.19  service pensions is equal to the separate relief association 
116.20  account balance or the fair market value of the separate 
116.21  investment vehicle held by the relief association. 
116.22     (f) (g) The deferred service pension is governed by and 
116.23  must be calculated under the general statute, special law, 
116.24  relief association articles of incorporation, and relief 
116.25  association bylaw provisions applicable on the date on which the 
116.26  member separated from active service with the fire department 
116.27  and active membership in the relief association. 
116.28     Sec. 13.  [424A.021] [CREDIT FOR BREAK IN SERVICE TO 
116.29  PROVIDE UNIFORMED SERVICE.] 
116.30     Subdivision 1.  [AUTHORIZATION.] Subject to restrictions 
116.31  stated in this section, a volunteer firefighter who is absent 
116.32  from firefighting service due to service in the uniformed 
116.33  services, as defined in United States Code, title 38, section 
116.34  4303(13), may obtain service credit if the relief association is 
116.35  a defined benefit plan or an allocation of any fire state aid, 
116.36  any municipal contributions, and any investment return received 
117.1   by the relief association if the relief association is a defined 
117.2   contribution plan for the period of the uniformed service, not 
117.3   to exceed five years, unless a longer period is required under 
117.4   United States Code, title 38, section 4312.  
117.5      Subd. 2.  [LIMITATIONS.] (a) To be eligible for service 
117.6   credit or an investment return allocation under this section, 
117.7   the volunteer firefighter must return to firefighting service 
117.8   with coverage by the same relief association or by the successor 
117.9   to that relief association upon discharge from service in the 
117.10  uniformed service within the time frame required in United 
117.11  States Code, title 38, section 4312(e). 
117.12     (b) Service credit or an investment return allocation is 
117.13  not authorized if the firefighter separates from uniformed 
117.14  service with a dishonorable or bad conduct discharge or under 
117.15  other than honorable conditions. 
117.16     (c) Service credit or an investment return allocation is 
117.17  not authorized if the firefighter fails to provide notice to the 
117.18  fire department that the individual is leaving to provide 
117.19  service in the uniformed service, unless it is not feasible to 
117.20  provide that notice due to the emergency nature of the situation.
117.21     Sec. 14.  Minnesota Statutes 2004, section 424A.04, 
117.22  subdivision 1, is amended to read: 
117.23     Subdivision 1.  [MEMBERSHIP.] (a) Every A relief 
117.24  association that is directly associated with a municipal fire 
117.25  department shall must be managed by a board of trustees 
117.26  consisting of nine members.  Six trustees shall must be elected 
117.27  from the membership of the relief association and three trustees 
117.28  shall must be drawn from the officials of the municipalities 
117.29  served by the fire department to which the relief association is 
117.30  directly associated.  The bylaws of a relief association which 
117.31  provides a monthly benefit service pension may provide that one 
117.32  of the six trustees elected from the relief 
117.33  association membership may be a retired member receiving a 
117.34  monthly pension who is elected by the membership of the relief 
117.35  association.  The three ex officio municipal trustees shall be 
117.36  the mayor, the clerk, clerk-treasurer or finance director, must 
118.1   be one elected municipal official and one elected or appointed 
118.2   municipal official who are designated as municipal 
118.3   representatives by the municipal governing board annually and 
118.4   the chief of the municipal fire department. 
118.5      (b) Every A relief association that is a subsidiary of an 
118.6   independent nonprofit firefighting corporation shall must be 
118.7   managed by a board of trustees consisting of ten nine members.  
118.8   Six trustees shall must be elected from the membership of the 
118.9   relief association, three two trustees shall must be drawn from 
118.10  the officials of the municipalities served by the fire 
118.11  department to which the relief association is directly 
118.12  associated, and one trustee shall be the fire chief serving with 
118.13  the independent nonprofit firefighting corporation.  The bylaws 
118.14  of a relief association may provide that one of the six trustees 
118.15  elected from the relief association membership may be a retired 
118.16  member receiving a monthly pension who is elected by the 
118.17  membership of the relief association.  The three ex officio two 
118.18  municipal trustees who are the elected officials shall must 
118.19  be elected or appointed municipal officials, selected as follows:
118.20     (1) if only one municipality contracts with the independent 
118.21  nonprofit firefighting corporation, the ex officio municipal 
118.22  trustees shall must be three elected two officials of the 
118.23  contracting municipality who are designated annually by the 
118.24  governing body of the municipality; 
118.25     (2) if two municipalities contract with the independent 
118.26  nonprofit firefighting corporation, the ex officio trustees 
118.27  shall be two elected officials of the largest municipality in 
118.28  population and one elected official of the next largest 
118.29  municipality in population who are designated by the governing 
118.30  bodies of the applicable municipalities; or 
118.31     (3) (2) if three two or more municipalities contract with 
118.32  the independent nonprofit corporation, the ex officio municipal 
118.33  trustees shall must be one elected official of from each of 
118.34  the three two largest municipalities in population who are 
118.35  designated annually by the governing bodies of the applicable 
118.36  municipalities. 
119.1      (c) The municipal trustees for a relief association that is 
119.2   directly associated with a fire department operated as or by a 
119.3   joint powers entity must be designated annually by the joint 
119.4   powers board.  The municipal trustees for a relief association 
119.5   that is directly associated with a fire department service area 
119.6   township must be designated by the township board. 
119.7      (d) If a relief association lacks the ex officio municipal 
119.8   board members provided for in paragraph (a), (b), or (b) (c) 
119.9   because the fire department is not located in or associated with 
119.10  an organized municipality, joint powers entity, or township, the 
119.11  ex officio municipal board members must be appointed from the 
119.12  fire department service area by the board of commissioners of 
119.13  the applicable county.  
119.14     (e) The term of these appointed ex officio municipal board 
119.15  members is three years one year or until the person's successor 
119.16  is qualified, whichever is later. 
119.17     (d) An ex officio (f) A municipal trustee under paragraph 
119.18  (a), (b), or (c) shall have, or (d) has all the rights and 
119.19  duties accorded to any other trustee, except the right to be an 
119.20  officer of the relief association board of trustees.  
119.21     (e) (g) A board shall must have at least three officers, 
119.22  which shall be who are a president, a secretary and a treasurer. 
119.23  These officers shall must be elected from among the elected 
119.24  trustees by either the full board of trustees or by the 
119.25  membership, as specified in the bylaws, and.  In no event shall 
119.26  may any trustee hold more than one officer position at any one 
119.27  time.  The terms of the elected trustees and of the officers of 
119.28  the board shall must be specified in the bylaws of the relief 
119.29  association, but shall may not exceed three years.  If the term 
119.30  of the elected trustees exceeds one year, the election of the 
119.31  various trustees elected from the membership shall initially and 
119.32  shall thereafter continue to must be staggered on as equal a 
119.33  basis as is practicable. 
119.34     Sec. 15.  Minnesota Statutes 2004, section 424B.10, 
119.35  subdivision 1, is amended to read: 
119.36     Subdivision 1.  [BENEFITS.] (a) Notwithstanding any 
120.1   provision of section 424A.02, subdivision 3, to the contrary, 
120.2   the service pension of the subsequent relief association as of 
120.3   the effective date of consolidation is either the service 
120.4   pension amount specified in clause (1) or the service pension 
120.5   amounts specified in clause (2), as provided for in the 
120.6   consolidated relief association's articles of incorporation or 
120.7   bylaws: 
120.8      (1) the highest dollar amount service pension amount of any 
120.9   prior volunteer firefighters relief association in effect 
120.10  immediately before the consolidation initiation if the pension 
120.11  amount was implemented consistent with section 424A.02; or 
120.12     (2) for service rendered by each individual volunteer 
120.13  firefighter before consolidation, the service pension amount 
120.14  under the consolidating volunteer firefighters relief 
120.15  association that the firefighter belonged to immediately before 
120.16  the consolidation if the pension amount was implemented 
120.17  consistent with section 424A.02 and for service rendered after 
120.18  the effective date of the consolidation, the highest dollar 
120.19  amount service pension of any of the consolidating volunteer 
120.20  firefighters relief associations in effect immediately before 
120.21  the consolidation if the pension amount was implemented 
120.22  consistent with section 424A.02. 
120.23     (b) Any increase in the service pension amount beyond the 
120.24  amount implemented under paragraph (a) must conform with the 
120.25  requirements and limitations of sections 69.771 to 69.775 and 
120.26  424A.02. 
120.27     Sec. 16.  [STUDY OF STATEWIDE LUMP-SUM VOLUNTEER 
120.28  FIREFIGHTER RETIREMENT PLAN; CREATION OF TASK FORCE.] 
120.29     Subdivision 1.  [TASK FORCE MEMBERSHIP.] (a) A statewide 
120.30  Volunteer Firefighter Retirement Plan Study Task Force is 
120.31  created. 
120.32     (b) The task force members are: 
120.33     (1) four members who are appointed by the president of the 
120.34  Minnesota Area Relief Association coalition; 
120.35     (2) four members who are appointed by the president of the 
120.36  Minnesota State Fire Department Association; 
121.1      (3) four members who are appointed by the president of the 
121.2   Minnesota State Fire Chiefs Association; 
121.3      (4) four members who are appointed by the board of 
121.4   directors of the League of Minnesota Cities; 
121.5      (5) two members who are appointed by the board of directors 
121.6   of the Insurance Federation of Minnesota; 
121.7      (6) two members who are appointed by the board of directors 
121.8   of the Minnesota Association of Farm Mutual Insurance Companies; 
121.9   and 
121.10     (7) the Minnesota state auditor or the auditor's designee. 
121.11     (c) Appointments must be made on or before July 1, 2005.  
121.12  If the appointment is not made in a timely manner, or if there 
121.13  is a vacancy, the state auditor shall appoint the task force 
121.14  member or the replacement member. 
121.15     (d) The chair of the task force shall be selected by the 
121.16  task force.  
121.17     (e) Administrative services for the task force must be 
121.18  provided by the Department of Public Safety. 
121.19     Subd. 2.  [TASK FORCE DUTIES.] (a) The task force shall 
121.20  conduct fact finding regarding the creation of a statewide 
121.21  volunteer firefighter retirement plan. 
121.22     (b) The task force shall recommend whether or not a 
121.23  statewide volunteer firefighter retirement plan should be 
121.24  created.  If the task force concludes a statewide volunteer 
121.25  firefighter retirement plan has merit, the task force shall 
121.26  recommend the investment vehicle or vehicles to be utilized by 
121.27  the plan, the administration and corporate governance structure 
121.28  of the plan, the incentives needed to formulate the plan, the 
121.29  limitations applicable to the plan, and the state resources 
121.30  needed to be dedicated to the plan.  The task force may also 
121.31  consider creation of regional volunteer firefighter retirement 
121.32  plans.  
121.33     Subd. 3.  [REPORT.] The task force shall prepare a report 
121.34  detailing its findings about a potential statewide or regional 
121.35  volunteer firefighter retirement plan or plans.  The report is 
121.36  due January 15, 2006, and must be filed with the Legislative 
122.1   Reference Library; the chair of the Legislative Commission on 
122.2   Pensions and Retirement; the chair of the State and Local 
122.3   Governmental Operations Committee of the senate; the chair of 
122.4   the State Government Budget Division of the senate Finance 
122.5   Committee; the chair of the Governmental Operations and Veterans 
122.6   Affairs Committee of the house of representatives; and the chair 
122.7   of the State Government Finance Committee of the house of 
122.8   representatives. 
122.9      Sec. 17.  [EFFECTIVE DATE.] 
122.10     (a) Sections 1 to 12, 14, and 15 are effective July 1, 2005.
122.11     (b) Section 13 is effective July 1, 2005, and applies to 
122.12  breaks in service that end on or after that date. 
122.13     (c) Section 16 is effective the day following final 
122.14  enactment. 
122.15                             ARTICLE 12
122.16                        VARIOUS CORRECTIONS
122.17                         AND CLARIFICATIONS
122.18     Section 1.  Minnesota Statutes 2004, section 3A.13, is 
122.19  amended to read: 
122.20     3A.13 [EXEMPTION FROM PROCESS AND TAXATION; HEALTH PREMIUM 
122.21  DEDUCTION.] 
122.22     (a) The provisions of section 352.15 shall 356.401 apply to 
122.23  the legislators retirement plan, chapter 3A. 
122.24     (b) The executive director of the Minnesota State 
122.25  Retirement System must, at the request of a retired legislator 
122.26  who is enrolled in a health insurance plan covering state 
122.27  employees, deduct the person's health insurance premiums from 
122.28  the person's annuity and transfer the amount of the premium to a 
122.29  health insurance carrier covering state employees. 
122.30     Sec. 2.  Minnesota Statutes 2004, section 69.011, 
122.31  subdivision 2b, is amended to read: 
122.32     Subd. 2b.  [DEPARTMENTS OF NATURAL RESOURCES AND PUBLIC 
122.33  SAFETY.] (a) On or before July 1, 1997, the commissioner of 
122.34  natural resources shall certify one-half of the number of peace 
122.35  officers as defined in subdivision 1, clause (g), employed by 
122.36  the Enforcement Division during calendar year 1996 and the 
123.1   commissioner of public safety shall certify one-half of the 
123.2   number of peace officers as defined in subdivision 1, clause 
123.3   (g), employed by the Bureau of Criminal Apprehension, the 
123.4   Gambling Enforcement Division, and the State Patrol Division 
123.5   during calendar year 1996. 
123.6      (b) On or before March 15, 1998, the commissioner of 
123.7   natural resources shall certify seven-tenths of the number of 
123.8   peace officers as defined in subdivision 1, clause (g), employed 
123.9   by the Enforcement Division and the commissioner of public 
123.10  safety shall certify seven-tenths of the number of peace 
123.11  officers as defined in subdivision 1, clause (g), employed by 
123.12  the Bureau of Criminal Apprehension, the Gambling Enforcement 
123.13  Division, and the State Patrol Division. 
123.14     (c) On or before March 15, 1999, and annually on or before 
123.15  each March 15 thereafter, the commissioner of natural resources 
123.16  shall certify the number of peace officers as defined in 
123.17  subdivision 1, clause (g), employed by the Enforcement Division 
123.18  and the commissioner of public safety shall certify the number 
123.19  of peace officers as defined in subdivision 1, clause (g), 
123.20  employed by the Bureau of Criminal Apprehension, the Gambling 
123.21  Enforcement Division, and the State Patrol Division. 
123.22     (d) (b) The certification must be on a form prescribed by 
123.23  the commissioner.  Peace officers certified under this paragraph 
123.24  must be included in the total certifications under subdivision 2.
123.25     Sec. 3.  Minnesota Statutes 2004, section 69.021, 
123.26  subdivision 5, is amended to read: 
123.27     Subd. 5.  [CALCULATION OF STATE AID.] (a) The amount of 
123.28  fire state aid available for apportionment, before the addition 
123.29  of the minimum fire state aid allocation amount under 
123.30  subdivision 7, is equal to 107 percent of the amount of premium 
123.31  taxes paid to the state upon the fire, lightning, sprinkler 
123.32  leakage, and extended coverage premiums reported to the 
123.33  commissioner by insurers on the Minnesota Firetown Premium 
123.34  Report.  This amount shall must be reduced by the amount 
123.35  required to pay the state auditor's costs and expenses of the 
123.36  audits or exams of the firefighters relief associations. 
124.1      The total amount for apportionment in respect to fire state 
124.2   aid must not be less than two percent of the premiums reported 
124.3   to the commissioner by insurers on the Minnesota Firetown 
124.4   Premium Report after subtracting the following amounts: 
124.5      (1) the amount required to pay the state auditor's costs 
124.6   and expenses of the audits or exams of the firefighters relief 
124.7   associations; and 
124.8      (2) one percent of the premiums reported by town and 
124.9   farmers' mutual insurance companies and mutual property and 
124.10  casualty companies with total assets of $5,000,000 or less.  
124.11     (b) The total amount for apportionment as police state aid 
124.12  is equal to 104 percent of the amount of premium taxes paid to 
124.13  the state on the premiums reported to the commissioner by 
124.14  insurers on the Minnesota Aid to Police Premium Report, reduced 
124.15  by the amount required to pay the costs and expenses of the 
124.16  state auditor for audits or exams of police relief 
124.17  associations.  The total amount for apportionment in respect to 
124.18  the police state aid program must not be less than two percent 
124.19  of the amount of premiums reported to the commissioner by 
124.20  insurers on the Minnesota Aid to Police Premium Report after 
124.21  subtracting the amount required to pay the state auditor's cost 
124.22  and expenses of the audits or exams of the police relief 
124.23  associations.  
124.24     (c) The commissioner shall calculate the percentage of 
124.25  increase or decrease reflected in the apportionment over or 
124.26  under the previous year's available state aid using the same 
124.27  premiums as a basis for comparison. 
124.28     (d) The amount for apportionment in respect to peace 
124.29  officer state aid under paragraph (b) must be further reduced by 
124.30  $1,779,000 in fiscal year 1999, $2,077,000 in fiscal year 2000, 
124.31  and $2,404,000 in fiscal year 2001.  These reductions in this 
124.32  paragraph cancel to the general fund. 
124.33     (e) In addition to the amount for apportionment of police 
124.34  state aid under paragraph (b), each year $100,000 shall must be 
124.35  apportioned for police state aid.  An amount sufficient to pay 
124.36  this increase is annually appropriated from the general fund. 
125.1      Sec. 4.  Minnesota Statutes 2004, section 69.021, 
125.2   subdivision 11, is amended to read: 
125.3      Subd. 11.  [EXCESS POLICE STATE-AID HOLDING ACCOUNT.] (a) 
125.4   The excess police state-aid holding account is established in 
125.5   the general fund.  The excess police state-aid holding account 
125.6   must be administered by the commissioner. 
125.7      (b) Excess police state aid determined according to 
125.8   subdivision 10, must be deposited in the excess police state-aid 
125.9   holding account. 
125.10     (c) From the balance in the excess police state-aid holding 
125.11  account, $900,000 is appropriated to and must be transferred 
125.12  annually to the ambulance service personnel longevity award and 
125.13  incentive suspense account established by section 144E.42, 
125.14  subdivision 2. 
125.15     (d) If a police officer stress reduction program is created 
125.16  by law and money is appropriated for that program, an amount 
125.17  equal to that appropriation must be transferred to the 
125.18  administrator of that program from the balance in the excess 
125.19  police state-aid holding account. 
125.20     (e) On October 1, 1997, and annually on each subsequent 
125.21  October 1 of each year, one-half of the balance of the excess 
125.22  police state-aid holding account remaining after the deductions 
125.23  under paragraphs (c) and (d) is appropriated for additional 
125.24  amortization aid under section 423A.02, subdivision 1b. 
125.25     (f) Annually, the remaining balance in the excess police 
125.26  state-aid holding account, after the deductions under paragraphs 
125.27  (c), (d), and (e), cancels to the general fund. 
125.28     Sec. 5.  Minnesota Statutes 2004, section 69.33, is amended 
125.29  to read: 
125.30     69.33 [NAMES OF ASSOCIATIONS REPORTED TO INSURANCE 
125.31  COMPANIES.] 
125.32     The commissioner shall enclose in the annual statement 
125.33  blank that is sent to all fire insurance companies doing 
125.34  business in this state a blank form containing the names of all 
125.35  firefighters' relief associations in all cities of the first 
125.36  class and the names of the cities and require these companies, 
126.1   at the time of making their annual statements to the 
126.2   commissioner, to state on these blanks the amount of premiums 
126.3   received by them upon properties insured within the corporate 
126.4   limits of the cities named thereon during the year ending 
126.5   December 31st last past.  Thereafter, before July first each 
126.6   year, the commissioner shall certify to the commissioner of 
126.7   finance the information thus obtained, together with the amount 
126.8   of the tax for the benefit of the relief association pension 
126.9   plans covering firefighters in cities of the first class paid in 
126.10  such year by these companies upon these insurance premiums. 
126.11     Sec. 6.  Minnesota Statutes 2004, section 69.773, 
126.12  subdivision 4, is amended to read: 
126.13     Subd. 4.  [FINANCIAL REQUIREMENTS OF SPECIAL FUND.] Prior 
126.14  to Before August 1 of each year, the officers of the relief 
126.15  association shall determine the financial requirements of the 
126.16  special fund of the relief association in accordance with the 
126.17  requirements of this subdivision.  The financial requirements of 
126.18  the relief association shall must be based on the most recent 
126.19  actuarial valuation of the special fund prepared in accordance 
126.20  with subdivision 2.  If the relief association has an unfunded 
126.21  actuarial accrued liability as reported in the most recent 
126.22  actuarial valuation, the financial requirements shall must be 
126.23  determined by adding the figures calculated pursuant to under 
126.24  clauses (a), (b), and (c).  If the relief association does not 
126.25  have an unfunded actuarial accrued liability as reported in the 
126.26  most recent actuarial valuation, the financial requirements 
126.27  shall must be an amount equal to the figure calculated pursuant 
126.28  to under clauses (a) and (b), reduced by an amount equal to 
126.29  one-tenth of the amount of any assets in excess of the actuarial 
126.30  accrued liability of the relief association.  The determination 
126.31  of whether or not the relief association has an unfunded 
126.32  actuarial accrued liability shall must be based on the current 
126.33  market value of assets for which a market value is readily 
126.34  ascertainable and the cost or book value, whichever is 
126.35  applicable, for assets for which no market value is readily 
126.36  ascertainable. 
127.1      (a) The normal level cost requirement for the following 
127.2   year, expressed as a dollar amount, shall be is the figure for 
127.3   the normal level cost of the relief association as reported in 
127.4   the actuarial valuation. 
127.5      (b) The amount of anticipated future administrative 
127.6   expenses of the special fund shall must be calculated by 
127.7   multiplying the dollar amount of the administrative expenses of 
127.8   the special fund for the most recent year by the factor of 1.035.
127.9      (c) The amortization contribution requirement to retire the 
127.10  current unfunded actuarial accrued liability by the established 
127.11  date for full funding shall be is the figure for the 
127.12  amortization contribution as reported in the actuarial 
127.13  valuation.  If there has not been a change in the actuarial 
127.14  assumptions used for calculating the actuarial accrued liability 
127.15  of the special fund, a change in the bylaws of the relief 
127.16  association governing the service pensions, retirement benefits, 
127.17  or both payable from the special fund or a change in the 
127.18  actuarial cost method used to value all or a portion of the 
127.19  special fund which change or changes, which by themselves 
127.20  without inclusion of any other items of increase or decrease, 
127.21  produce a net increase in the unfunded actuarial accrued 
127.22  liability of the special fund since December 31, 1970, the 
127.23  established date for full funding shall be December 31, 1990.  
127.24  If there has been a change in the actuarial assumptions used for 
127.25  calculating the actuarial accrued liability of the special fund, 
127.26  a change in the bylaws of the relief association governing the 
127.27  service pensions, retirement benefits, or both payable from the 
127.28  special fund or a change in the actuarial cost method used to 
127.29  value all or a portion of the special fund and the change or 
127.30  changes, by themselves and without inclusion of any other items 
127.31  of increase or decrease, produce a net increase in the unfunded 
127.32  actuarial accrued liability of the special fund since December 
127.33  31, 1970, but prior to January 1, 1979, the established date for 
127.34  full funding shall be December 31, 1998, and if there has been a 
127.35  change since December 31, 1978, the established date for full 
127.36  funding shall must be determined using the following procedure:  
128.1      (i) the unfunded actuarial accrued liability of the special 
128.2   fund shall must be determined in accordance with the provisions 
128.3   governing service pensions, retirement benefits, and actuarial 
128.4   assumptions in effect before an applicable change; 
128.5      (ii) the level annual dollar contribution needed to 
128.6   amortize this unfunded actuarial accrued liability amount by the 
128.7   date for full funding in effect prior to before the change shall 
128.8   must be calculated using the interest assumption specified in 
128.9   section 356.215, subdivision 8, in effect before any applicable 
128.10  change; 
128.11     (iii) the unfunded actuarial accrued liability of the 
128.12  special fund shall must be determined in accordance with any new 
128.13  provisions governing service pensions, retirement benefits, and 
128.14  actuarial assumptions and the remaining provisions governing 
128.15  service pensions, retirement benefits, and actuarial assumptions 
128.16  in effect before an applicable change; 
128.17     (iv) the level annual dollar contribution needed to 
128.18  amortize the difference between the unfunded actuarial accrued 
128.19  liability amount calculated pursuant to under subclause (i) and 
128.20  the unfunded actuarial accrued liability amount 
128.21  calculated pursuant to under subclause (iii) over a period of 20 
128.22  years starting December 31 of the year in which the change is 
128.23  effective shall must be calculated using the interest assumption 
128.24  specified in section 356.215, subdivision 8, in effect after any 
128.25  applicable change; 
128.26     (v) the annual amortization contribution calculated 
128.27  pursuant to under subclause (iv) shall must be added to the 
128.28  annual amortization contribution calculated pursuant to under 
128.29  subclause (ii); 
128.30     (vi) the period in which the unfunded actuarial accrued 
128.31  liability amount determined in subclause (iii) will be amortized 
128.32  by the total annual amortization contribution computed pursuant 
128.33  to under subclause (v) shall must be calculated using the 
128.34  interest assumption specified in section 356.215, subdivision 8, 
128.35  in effect after any applicable change, rounded to the nearest 
128.36  integral number of years, but which shall does not exceed a 
129.1   period of 20 years from the end of the year in which the 
129.2   determination of the date for full funding using this procedure 
129.3   is made and which shall is not be less than the period of years 
129.4   beginning in the year in which the determination of the date for 
129.5   full funding using this procedure is made and ending by the date 
129.6   for full funding in effect before the change; 
129.7      (vii) the period determined pursuant to under subclause (vi)
129.8   shall must be added to the date as of which the actuarial 
129.9   valuation was prepared and the resulting date shall be is the 
129.10  new date for full funding. 
129.11     Sec. 7.  Minnesota Statutes 2004, section 352.01, 
129.12  subdivision 4, is amended to read: 
129.13     Subd. 4.  [ACCUMULATED CONTRIBUTIONS.] "Accumulated 
129.14  contributions" means the total, exclusive of interest, of (1) 
129.15  the sums deducted from the salary of an employee, (2) the amount 
129.16  of payments, including assessments, paid by the employee in lieu 
129.17  of salary deductions and all other payments made under Laws 
129.18  1929, chapter 191, as amended, this chapter and credited to the 
129.19  employee's individual account in the retirement fund. 
129.20     Sec. 8.  Minnesota Statutes 2004, section 352.01, 
129.21  subdivision 5, is amended to read: 
129.22     Subd. 5.  [RETIREMENT FUND.] (a) "Retirement fund" means 
129.23  the general state employees retirement fund created by section 
129.24  352.04, subdivision 1, with respect to the general state 
129.25  employees retirement plan or the correctional state employees 
129.26  retirement fund created by section 352.911, subdivision 1, with 
129.27  respect to the correctional state employees retirement plan. 
129.28     (b) "The retirement fund" includes the aggregate of 
129.29  accumulated contributions of employees covered by the applicable 
129.30  plan, and all other funds paid into the state treasury or 
129.31  received by the director under Laws 1929, chapter 191, as 
129.32  amended this chapter, together with all income and profits from 
129.33  the money and interest on it, including contributions on the 
129.34  part of the federal government, the state, and state departments.
129.35     Sec. 9.  Minnesota Statutes 2004, section 352.01, 
129.36  subdivision 21, is amended to read: 
130.1      Subd. 21.  [ACCRUED ANNUITIES.] (a) In this chapter and 
130.2   chapters 3A, 352B, 352C, and 490, "accrued annuity"  means an 
130.3   annuity that had become payable to a retired employee in the 
130.4   lifetime of the employee.  
130.5      (b) An annuity or benefit authorized as provided in this 
130.6   chapter and chapters 3A, 352B, 352C, and 490 becomes payable on 
130.7   the first day of each calendar month for that calendar month and 
130.8   is to must be paid on the first day of each calendar month 
130.9   beginning with benefits payable on and after December 1, 1977. 
130.10     (c) Notwithstanding any provision to the contrary in this 
130.11  chapter and chapters 3A, 352B, 352C, and 490, benefit payment 
130.12  authorized as "payable for life" is payable for the entire month 
130.13  in which death occurs, and the benefit payment for the month of 
130.14  death is payable to the surviving spouse or other beneficiary 
130.15  only if the annuitant dies before negotiating the benefit check. 
130.16     Sec. 10.  Minnesota Statutes 2004, section 352.01, 
130.17  subdivision 23, is amended to read: 
130.18     Subd. 23.  [COVERAGE OR COVERED BY THE SYSTEM.] "Coverage"  
130.19  or "covered by the system" means that a state employees employee 
130.20  who serve serves the state of Minnesota and make makes the 
130.21  required employee contributions to the retirement fund will is, 
130.22  by reason of these contributions become, entitled to either (1) 
130.23  a retirement annuity, or (2) a disability benefit, or (3) a 
130.24  refund of accumulated contributions, as provided in this chapter.
130.25     Sec. 11.  Minnesota Statutes 2004, section 352.021, 
130.26  subdivision 1, is amended to read: 
130.27     Subdivision 1.  [ESTABLISHMENT.] (a) There is established 
130.28  the general state employees retirement plan of the Minnesota 
130.29  State Retirement System for state employees.  
130.30     (b) The system general state employees retirement plan is a 
130.31  continuation of the State Employees Retirement Association.  
130.32     (c) Any person who was a member of the State Employees 
130.33  Retirement Association on June 30, 1967, is covered by 
130.34  the system general state employees retirement plan and is 
130.35  entitled to all benefits provided by the system plan upon 
130.36  fulfilling the age, service, contribution, and other 
131.1   requirements of this chapter.  
131.2      Sec. 12.  Minnesota Statutes 2004, section 352.021, 
131.3   subdivision 2, is amended to read: 
131.4      Subd. 2.  [STATE EMPLOYEES COVERED.] Every person who is a 
131.5   state employee, as defined in section 352.01, on July 1, 1967, 
131.6   or becomes a state employee after that date as defined in 
131.7   section 352.01 is covered by the system general state employees 
131.8   retirement plan.  Acceptance of state employment or continuance 
131.9   in state service is deemed to be consent to have deductions made 
131.10  from salary for deposit to the credit of the account of the 
131.11  state employee in the retirement fund.  
131.12     Sec. 13.  Minnesota Statutes 2004, section 352.021, 
131.13  subdivision 3, is amended to read: 
131.14     Subd. 3.  [OPTIONAL EXEMPTIONS.] Any person who is 
131.15  appointed by the governor or lieutenant governor may request 
131.16  exemption from coverage by the general state employees 
131.17  retirement plan under this chapter if the appointee is not so 
131.18  covered at by the plan on the date of appointment.  To qualify 
131.19  for this exemption, a written request must be made within 90 
131.20  days from the date of entering upon the duties of the position 
131.21  to which the person is appointed.  After making the request, a 
131.22  person requesting the exemption is not entitled to coverage by 
131.23  the general state employees retirement plan while employed in 
131.24  the position that entitled that person to an exemption from 
131.25  coverage.  
131.26     Sec. 14.  Minnesota Statutes 2004, section 352.021, 
131.27  subdivision 4, is amended to read: 
131.28     Subd. 4.  [REENTERING SERVICE AFTER REFUND.] When a former 
131.29  employee who has withdrawn accumulated contributions reenters 
131.30  employment in a position entitled to coverage under the 
131.31  system general state employees retirement plan, the employee 
131.32  shall must be covered by the system plan on the same basis as a 
131.33  new employee and is not entitled to credit for any former 
131.34  service.  The annuity rights forfeited when taking a refund can 
131.35  only be restored as provided in this chapter.  
131.36     Sec. 15.  Minnesota Statutes 2004, section 352.04, 
132.1   subdivision 1, is amended to read: 
132.2      Subdivision 1.  [FUND CREATED.] (a) There is created a 
132.3   special fund to be known as the general state employees 
132.4   retirement fund.  In that fund there shall be deposited 
132.5   employees, employee contributions, employers employer 
132.6   contributions, and other amounts authorized by law must be 
132.7   deposited.  
132.8      (b) Effective July 1, 1969, The general state employees 
132.9   retirement plan of the Minnesota State Retirement System shall 
132.10  must participate in the Minnesota postretirement investment fund.
132.11  In that fund there shall be deposited The amounts provided in 
132.12  section 352.119 must be deposited in the Minnesota 
132.13  postretirement investment fund.  
132.14     Sec. 16.  Minnesota Statutes 2004, section 352.04, 
132.15  subdivision 12, is amended to read: 
132.16     Subd. 12.  [FUND DISBURSEMENT RESTRICTED.] The general 
132.17  state employees retirement fund and the participation in the 
132.18  Minnesota postretirement investment fund must be disbursed only 
132.19  for the purposes provided by law.  The expenses of the system 
132.20  and any benefits provided by law, other than benefits payable 
132.21  from the Minnesota postretirement investment fund, must be paid 
132.22  from the general state employees retirement fund.  The 
132.23  retirement allowances, retirement annuities, and disability 
132.24  benefits, as well as refunds of any sum remaining to the credit 
132.25  of a deceased retired employee or a disabled employee must be 
132.26  paid only from the general state employees retirement fund after 
132.27  the needs have been certified and the amounts withdrawn from the 
132.28  participation in the Minnesota postretirement investment fund 
132.29  under section 11A.18.  The amounts necessary to make the 
132.30  payments from the general state employees retirement fund and 
132.31  the participation in the Minnesota postretirement investment 
132.32  fund are annually appropriated from these funds for those 
132.33  purposes.  
132.34     Sec. 17.  Minnesota Statutes 2004, section 352.041, 
132.35  subdivision 1, is amended to read: 
132.36     Subdivision 1.  [ALLOWABLE SERVICE CREDIT.] Any (a) An 
133.1   employee covered by the system general state employees 
133.2   retirement plan who is given a leave of absence for employment 
133.3   by a political subdivision of the state shall remains a member 
133.4   of the plan and must continue to pay member contributions into 
133.5   the general state employees retirement fund for the period of 
133.6   leave.  
133.7      (b) Upon payment of member contributions, the employee must 
133.8   be given allowable service credit as a state employee on the 
133.9   records of the system retirement plan as though the employee had 
133.10  received salary from the state during the leave.  Payments into 
133.11  the retirement fund shall must be at the rate required in 
133.12  section 352.04, subdivision 2, and must be based upon the salary 
133.13  received from the political subdivision subject to the maximum 
133.14  amount, if any. 
133.15     Sec. 18.  Minnesota Statutes 2004, section 352.041, 
133.16  subdivision 2, is amended to read: 
133.17     Subd. 2.  [EMPLOYEE CONTRIBUTIONS, PROCEDURE.] The officer 
133.18  or employee who is authorized by law to pay salaries to 
133.19  employees of the political subdivision which is employing a 
133.20  state employee shall have must deduct employee contributions 
133.21  deducted for the general state employees retirement plan under 
133.22  section 352.04, subdivision 2, from the salary of each employee 
133.23  who is on leave of absence from state service on each payroll 
133.24  abstract and shall must pay the sum to the director following 
133.25  the conclusion of each pay period. 
133.26     Sec. 19.  Minnesota Statutes 2004, section 352.041, 
133.27  subdivision 3, is amended to read: 
133.28     Subd. 3.  [EMPLOYER CONTRIBUTIONS, PROCEDURE.] The officer 
133.29  or employee who is authorized by law to pay salaries to 
133.30  employees of the political subdivision which is employing a 
133.31  state employee covered by the system shall general state 
133.32  employees retirement plan also must have employer contributions 
133.33  made to the general state employees retirement fund on following 
133.34  the conclusion of each payroll abstract in the amount required 
133.35  by section 352.04, subdivision 3.  These contributions are to 
133.36  must be charged to the political subdivision as an 
134.1   administrative cost.  
134.2      Sec. 20.  Minnesota Statutes 2004, section 352.041, 
134.3   subdivision 5, is amended to read: 
134.4      Subd. 5.  [EMPLOYER CONTRIBUTIONS, LEAVES OF ABSENCE; TAX 
134.5   LEVIES.] (a) Every political subdivision which is employing a 
134.6   state employee covered by the system on leave of absence from 
134.7   state service for employment by a political subdivision of the 
134.8   state shall must pay into the general state employees retirement 
134.9   fund the amount of the employer contribution required by law for 
134.10  state employees covered by the system under section 352.04, 
134.11  subdivision 3.  
134.12     (b) Employing political subdivisions, except other than 
134.13  school districts, may levy taxes necessary for the payment of 
134.14  employer contributions without limitation as to rate or amount.  
134.15  The levy of the taxes does not reduce the amount of other 
134.16  taxes to that may be levied by political subdivisions, 
134.17  except other than school districts, which are subject to any 
134.18  limitation.  
134.19     Sec. 21.  Minnesota Statutes 2004, section 352.15, 
134.20  subdivision 1, is amended to read: 
134.21     Subdivision 1.  [EXEMPTION; EXCEPTIONS.] None of the money, 
134.22  annuities, or other benefits mentioned in this chapter is 
134.23  assignable either in law or in equity or subject to execution, 
134.24  levy, attachment, garnishment, or other legal process, except as 
134.25  provided in subdivision 1a or section 518.58, 518.581, or 
134.26  518.6111. The provisions of section 356.401 apply to the general 
134.27  state employees retirement plan and to the correctional state 
134.28  employees retirement plan.  
134.29     Sec. 22.  Minnesota Statutes 2004, section 352.15, 
134.30  subdivision 3, is amended to read: 
134.31     Subd. 3.  [DEDUCTING HEALTH OR DENTAL INSURANCE PREMIUMS.] 
134.32  The board may direct authorize, at its discretion, the deduction 
134.33  of a retiree's health or dental insurance premiums and transfer 
134.34  of the amounts to a health or dental insurance carrier covering 
134.35  state employees.  The insurance carrier must certify that the 
134.36  retired employee has signed an authorization for the deduction 
135.1   and provide a computer readable roster of covered retirees and 
135.2   amounts.  The health or dental insurance carrier must refund 
135.3   deductions withheld from a retiree's check in error directly to 
135.4   the retiree.  The board shall require that the insurance carrier 
135.5   to reimburse the fund for the administrative expense of 
135.6   withholding the premium amounts.  The insurance carrier shall 
135.7   assume liability for any failure of the system to properly 
135.8   withhold the premium amounts. 
135.9      Sec. 23.  Minnesota Statutes 2004, section 352.15, 
135.10  subdivision 4, is amended to read: 
135.11     Subd. 4.  [DIRECT TRANSFER OF REFUNDS.] A direct transfer 
135.12  of account refunds under this chapter may be made to an 
135.13  individual retirement savings accounts account or a qualified 
135.14  retirement plans plan of the person upon the receipt of an 
135.15  application for transfer by a former employee, on forms 
135.16  acceptable to the executive director. 
135.17     Sec. 24.  Minnesota Statutes 2004, section 352.22, 
135.18  subdivision 10, is amended to read: 
135.19     Subd. 10.  [OTHER REFUNDS.] Former employees covered by the 
135.20  system are entitled to apply for refunds if they are or become 
135.21  members of the State Patrol retirement fund, the state Teachers 
135.22  Retirement Association, or employees of the University of 
135.23  Minnesota excluded from coverage under the system by action of 
135.24  the Board of Regents; or labor service employees, excluded from 
135.25  coverage under section 352.01, subdivision 2b, clause (25); or 
135.26  employees of the adjutant general who under federal law 
135.27  effectually elect membership in a federal retirement system; or 
135.28  officers or employees of the senate or house of representatives, 
135.29  excluded from coverage under section 352.01, subdivision 2b, 
135.30  clause (8) (7).  The refunds must include accumulated 
135.31  contributions plus interest as provided in subdivision 2.  These 
135.32  employees may apply for a refund once 30 days or more have 
135.33  elapsed after their coverage ceases, even if they continue in 
135.34  state service but in positions not covered by this chapter. 
135.35     Sec. 25.  Minnesota Statutes 2004, section 352B.01, 
135.36  subdivision 1, is amended to read: 
136.1      Subdivision 1.  [SCOPE.] In this chapter, each of the terms 
136.2   defined in this section have has the meanings meaning given 
136.3   them to it. 
136.4      Sec. 26.  Minnesota Statutes 2004, section 352B.01, 
136.5   subdivision 2, is amended to read: 
136.6      Subd. 2.  [MEMBER.] "Member" means: 
136.7      (1) a State Patrol member currently employed after June 30, 
136.8   1943, under section 299D.03 by the state, who is a peace officer 
136.9   under section 626.84, and whose salary or compensation is paid 
136.10  out of state funds; 
136.11     (2) a conservation officer employed under section 97A.201, 
136.12  currently employed by the state, whose salary or compensation is 
136.13  paid out of state funds; 
136.14     (3) a crime bureau officer who was employed by the crime 
136.15  bureau and was a member of the Highway Patrolmen's retirement 
136.16  fund on July 1, 1978, whether or not that person has the power 
136.17  of arrest by warrant after that date, or who is employed as 
136.18  police personnel, with powers of arrest by warrant under section 
136.19  299C.04, and who is currently employed by the state, and whose 
136.20  salary or compensation is paid out of state funds; 
136.21     (4) a person who is employed by the state in the Department 
136.22  of Public Safety in a data processing management position with 
136.23  salary or compensation paid from state funds, who was a crime 
136.24  bureau officer covered by the State Patrol retirement plan on 
136.25  August 15, 1987, and who was initially hired in the data 
136.26  processing management position within the department during 
136.27  September 1987, or January 1988, with membership continuing for 
136.28  the duration of the person's employment in that position, 
136.29  whether or not the person has the power of arrest by warrant 
136.30  after August 15, 1987; 
136.31     (5) a public safety employee defined as who is a peace 
136.32  officer in under section 626.84, subdivision 1, paragraph (c), 
136.33  and who is employed with by the Division of Alcohol and Gambling 
136.34  Enforcement under section 299L.01; and 
136.35     (6) a Fugitive Apprehension Unit officer after October 31, 
136.36  2000, who is employed by the Office of Special Investigations of 
137.1   the Department of Corrections and who is a peace officer under 
137.2   section 626.84.  
137.3      Sec. 27.  Minnesota Statutes 2004, section 352B.01, 
137.4   subdivision 3, is amended to read: 
137.5      Subd. 3.  [ALLOWABLE SERVICE.] (a) "Allowable service" 
137.6   means:  
137.7      (1) for members defined in subdivision 2, clause (a) (1), 
137.8   monthly service is granted for in any month for which payments 
137.9   have been made to the State Patrol retirement fund, and 
137.10     (2) for members defined in subdivision 2, clauses (b) (2) 
137.11  and (c) (3), service for which payments have been made to the 
137.12  State Patrol retirement fund, service for which payments were 
137.13  made to the State Police officers retirement fund after June 30, 
137.14  1961, and all prior service which was credited to a member for 
137.15  service on or before June 30, 1961.  
137.16     (b) Allowable service also includes any period of absence 
137.17  from duty by a member who, by reason of injury incurred in the 
137.18  performance of duty, is temporarily disabled and for which 
137.19  disability the state is liable under the workers' compensation 
137.20  law, until the date authorized by the executive director for 
137.21  commencement of payment of a disability benefit or return to 
137.22  employment.  
137.23     (c) MS 2002 (Expired) 
137.24     (d) Allowable service means service in a month during which 
137.25  a member is paid a salary from which a member contribution is 
137.26  deducted, deposited, and credited in the State Patrol retirement 
137.27  plan. 
137.28     Sec. 28.  Minnesota Statutes 2004, section 352B.02, 
137.29  subdivision 1e, is amended to read: 
137.30     Subd. 1e.  [AUDIT; ACTUARIAL VALUATION.] The legislative 
137.31  auditor shall audit the fund.  Any actuarial valuation of the 
137.32  fund required under section 356.215 must be prepared by the 
137.33  actuary retained under section 356.214.  Any approved actuary 
137.34  retained by the executive director under section 352.03, 
137.35  subdivision 6, may perform actuarial valuations and experience 
137.36  studies to supplement those performed by the commission-retained 
138.1   actuary retained under section 356.214.  Any supplemental 
138.2   actuarial valuation or experience studies shall must be filed 
138.3   with the executive director of the Legislative Commission on 
138.4   Pensions and Retirement.  
138.5      Sec. 29.  Minnesota Statutes 2004, section 352B.071, is 
138.6   amended to read: 
138.7      352B.071 [EXEMPTION FROM PROCESS.] 
138.8      None of the money, annuities, or other benefits provided 
138.9   for in this chapter is assignable either in law or in equity or 
138.10  be subject to execution, levy, attachment, garnishment, or other 
138.11  legal process, except as provided in section 518.58, 518.581, or 
138.12  518.6111. The provisions of section 356.401 apply to the State 
138.13  Patrol retirement plan. 
138.14     Sec. 30.  Minnesota Statutes 2004, section 352D.01, is 
138.15  amended to read: 
138.16     352D.01 [ESTABLISHMENT.] 
138.17     There is hereby established within the Minnesota State 
138.18  Retirement System a retirement program for certain public 
138.19  employees to be known as the Minnesota unclassified employees 
138.20  retirement program, which shall be.  The program must be 
138.21  administered by the Minnesota State Retirement System.  
138.22     Sec. 31.  Minnesota Statutes 2004, section 352D.015, 
138.23  subdivision 3, is amended to read: 
138.24     Subd. 3.  [SUPPLEMENTAL INVESTMENT FUND.] "Supplemental 
138.25  investment fund" means the fund established and governed by 
138.26  section 11A.17.  
138.27     Sec. 32.  Minnesota Statutes 2004, section 352D.015, 
138.28  subdivision 4, is amended to read: 
138.29     Subd. 4.  [GENERAL FUND.] "General fund" means the general 
138.30  state employees retirement fund except the moneys for the 
138.31  unclassified program.  
138.32     Sec. 33.  Minnesota Statutes 2004, section 352D.03, is 
138.33  amended to read: 
138.34     352D.03 [TRANSFER OF ASSETS.] 
138.35     Unless an eligible employee enumerated in section 352D.02, 
138.36  subdivision 1 or 1a, has elected coverage under the individual 
139.1   retirement account plan under chapter 354B, a sum of money 
139.2   representing the assets credited to each employee exercising the 
139.3   option contained in section 352D.02, plus an equal employer 
139.4   contribution together with interest for the employment period at 
139.5   the actuarially assumed rates applicable preretirement interest 
139.6   actuarial assumption rate during this period, compounded 
139.7   annually, shall must be used for the purchase of shares on 
139.8   behalf of each employee in the accounts of the supplemental 
139.9   retirement fund established by section 11A.17.  Any employer's 
139.10  contribution to amortize the deficit in the state employee's 
139.11  retirement fund shall not, however, be used for the purchase of 
139.12  shares.  
139.13     Sec. 34.  Minnesota Statutes 2004, section 352D.05, 
139.14  subdivision 4, is amended to read: 
139.15     Subd. 4.  [REPAYMENT OF REFUND.] (a) A participant in the 
139.16  unclassified program may repay regular refunds taken pursuant to 
139.17  under section 352.22, as provided in section 352.23.  
139.18     (b) A participant in the unclassified program or an 
139.19  employee covered by the general plan who has withdrawn the value 
139.20  of the total shares may repay the refund taken and thereupon 
139.21  restore the service credit, rights and benefits forfeited by 
139.22  paying into the fund the amount refunded plus interest at an 
139.23  annual rate of 8.5 percent compounded annually from the date 
139.24  that the refund was taken until the date that the refund is 
139.25  repaid.  If the participant had withdrawn only the employee 
139.26  shares as permitted under prior laws, repayment shall must be 
139.27  pro rata.  Payment shall 
139.28     (c) Except as provided in section 356.441, the repayment of 
139.29  a refund under this section must be made in a lump sum.  
139.30     Sec. 35.  Minnesota Statutes 2004, section 352D.085, 
139.31  subdivision 1, is amended to read: 
139.32     Subdivision 1.  [COMBINED SERVICE.] Except as provided in 
139.33  section 356.30, 356.302, or 356.303, service under the 
139.34  unclassified program for which the employee has been credited 
139.35  with employee shares may be used for the limited purpose of 
139.36  qualifying for benefits under sections 352.115, 352.72, 
140.1   subdivision 1, 352.113, 354.44, 354.45, 354.48, and 354.60; 
140.2   provided such.  The service also may not be used to qualify for 
140.3   a disability benefit under section 352.113 or 354.48 if a 
140.4   participant was under the unclassified program at the time of 
140.5   the disability, and provided further that.  Also, the years of 
140.6   service and salary paid while the participant was in the 
140.7   unclassified program shall may not be used in determining the 
140.8   amount of benefits. 
140.9      Sec. 36.  Minnesota Statutes 2004, section 352D.09, 
140.10  subdivision 5, is amended to read: 
140.11     Subd. 5.  [UNCLAIMED BENEFITS.] If the beneficiary, 
140.12  surviving spouse or estate has not made application for benefits 
140.13  within ten years after the date of the death of a participant, 
140.14  the value of the shares shall be is appropriated to the regular 
140.15  general state employees retirement fund and the provisions of 
140.16  section 352.12, subdivision 12 shall, govern.  If a former 
140.17  participant fails to make a claim for benefits within five years 
140.18  after the termination of covered service or by age 70, whichever 
140.19  is later, the value of the shares shall be is appropriated to 
140.20  the general state employees retirement fund and the provisions 
140.21  of section 352.22, subdivision 8, shall apply.  
140.22     Sec. 37.  Minnesota Statutes 2004, section 352D.12, is 
140.23  amended to read: 
140.24     352D.12 [TRANSFER OF PRIOR SERVICE CONTRIBUTIONS.] 
140.25     (a) An employee who is a participant in the unclassified 
140.26  program and who has prior service credit in a covered plan under 
140.27  chapters 3A, chapter 352, 352C, 353, 354, 354A, and or 422A 
140.28  may, within the time limits specified in this section, elect to 
140.29  transfer to the unclassified program prior service contributions 
140.30  to one or more of those plans.  Participants with six or more 
140.31  years of prior service credit in a plan governed by chapter 3A 
140.32  or 352C on July 1, 1998, may not transfer prior service 
140.33  contributions.  Participants with less than six years of prior 
140.34  service credit in a plan governed by chapter 3A or 352C on July 
140.35  1, 1998, must be contributing to the unclassified plan on or 
140.36  after January 5, 1999, in order to transfer prior contributions. 
141.1      (b) For participants with prior service credit in a plan 
141.2   governed by chapter 352, 353, 354, 354A, or 422A, "prior service 
141.3   contributions" means the accumulated employee and equal employer 
141.4   contributions with interest at an annual rate of 8.5 percent 
141.5   compounded annually, based on fiscal year balances.  For 
141.6   participants with less than six years of service credit as of 
141.7   July 1, 1998, and with prior service credit in a plan governed 
141.8   by chapter 3A or 352C, "prior service contributions" means an 
141.9   amount equal to twice the amount of the accumulated member 
141.10  contributions plus annual compound interest at the rate of 8.5 
141.11  percent, computed on fiscal year balances.  
141.12     (c) If a participant has taken a refund from a retirement 
141.13  plan listed in this section, the participant may repay the 
141.14  refund to that plan, notwithstanding any restrictions on 
141.15  repayment to that plan, plus 8.5 percent interest compounded 
141.16  annually and have the accumulated employee and equal employer 
141.17  contributions transferred to the unclassified program with 
141.18  interest at an annual rate of 8.5 percent compounded annually 
141.19  based on fiscal year balances.  If a person repays a refund and 
141.20  subsequently elects to have the money transferred to the 
141.21  unclassified program, the repayment amount, including interest, 
141.22  is added to the fiscal year balance in the year which the 
141.23  repayment was made. 
141.24     (d) A participant electing to transfer prior service 
141.25  contributions credited to a retirement plan governed by chapter 
141.26  352, 353, 354, 354A, or 422A as provided under this section must 
141.27  complete the a written application for the transfer and repay 
141.28  any refund within one year of the commencement of the employee's 
141.29  participation in the unclassified program.  A participant 
141.30  electing to transfer prior service contributions credited to a 
141.31  retirement plan governed by chapter 3A or 352C as provided under 
141.32  this section must complete the application for the transfer and 
141.33  repay any refund between January 5, 1999, and June 1, 1999, if 
141.34  the employee commenced participation in the unclassified program 
141.35  before January 5, 1999, or within one year of the commencement 
141.36  of the employee's participation in the unclassified program if 
142.1   the employee commenced participation in the unclassified program 
142.2   after January 4, 1999. 
142.3      Sec. 38.  Minnesota Statutes 2004, section 353.01, 
142.4   subdivision 32, is amended to read: 
142.5      Subd. 32.  [COORDINATED MEMBER.] "Coordinated member" means 
142.6   any a public employee, including any a public hospital employee, 
142.7   who is covered by any an agreement or modification made between 
142.8   the state and the Secretary of Health, Education and Welfare 
142.9   Human Services, making the provisions of the federal Old Age, 
142.10  Survivors and Disability Insurance Act applicable to the member 
142.11  if the membership eligibility criteria are met under this 
142.12  chapter.  A coordinated member also is a former basic member who 
142.13  has a complete and continuous separation for at least 30 days 
142.14  from employment as a public employee meeting the requirements 
142.15  specified in subdivision 28, paragraphs (a) and (b), and who 
142.16  reenters public service as a public employee and meets the 
142.17  membership eligibility criteria under this chapter. 
142.18     Sec. 39.  Minnesota Statutes 2004, section 353.01, 
142.19  subdivision 33, is amended to read: 
142.20     Subd. 33.  [BASIC MEMBER.] "Basic member" means any a 
142.21  public employee, including any a public hospital employee, who 
142.22  is not covered by any agreement or modification made between the 
142.23  state and the Secretary of Health, Education and Welfare Human 
142.24  Services. 
142.25     Sec. 40.  Minnesota Statutes 2004, section 353.025, is 
142.26  amended to read: 
142.27     353.025 [RANGE ASSOCIATION OF MUNICIPALITIES AND SCHOOLS.] 
142.28     From and after January 1, 1982, Employees of the Range 
142.29  Association of Municipalities and Schools hereinafter referred 
142.30  to as the association, shall become are coordinated members of 
142.31  the general employees retirement plan of the Public Employees 
142.32  Retirement Association unless specifically exempt under section 
142.33  353.01, subdivision 2b, and.  The Range Association shall be 
142.34  deemed to be of Municipalities and Schools is a governmental 
142.35  subdivision for the purposes of this chapter.  
142.36     Sec. 41.  Minnesota Statutes 2004, section 353.026, is 
143.1   amended to read: 
143.2      353.026 [COVERAGE FOR CERTAIN MUNICIPAL AND SCHOOL DISTRICT 
143.3   EMPLOYEES.] 
143.4      Any person who was employed by the city of Minneapolis, 
143.5   Special School District No. 1, or public corporation as defined 
143.6   in section 422A.01, subdivision 9, on or after July 1, 1978, and 
143.7   prior to before July 1, 1979, and who was excluded from 
143.8   retirement coverage by the coordinated program of the 
143.9   Minneapolis municipal employees retirement fund pursuant to 
143.10  under section 422A.09, subdivision 3, shall be is entitled to 
143.11  retirement coverage by the general employees retirement plan of 
143.12  the Public Employees Retirement Association unless specifically 
143.13  excluded pursuant to under section 353.01, subdivision 2b, from 
143.14  and after May 19, 1981.  
143.15     Sec. 42.  Minnesota Statutes 2004, section 353.027, is 
143.16  amended to read: 
143.17     353.027 [RETENTION OF COVERAGE FOR CERTAIN MUNICIPAL COURT 
143.18  EMPLOYEES.] 
143.19     Any person employed on January 1, 1975, by a municipal 
143.20  court established pursuant to under Minnesota Statutes 1957, 
143.21  section 488.03, and located in the cities of New Brighton, 
143.22  Roseville, Maplewood, North Saint Paul, White Bear Lake, or St. 
143.23  Paul shall be is eligible for membership in the general 
143.24  employees retirement plan of the Public Employees Retirement 
143.25  Association and shall retain retains any rights or benefits the 
143.26  person had attained as a member of the general employees 
143.27  retirement plan of the association on January 1, 1975, so long 
143.28  as the person remains an employee of the municipal court of 
143.29  Ramsey County.  
143.30     Sec. 43.  Minnesota Statutes 2004, section 353.028, is 
143.31  amended to read: 
143.32     353.028 [CITY MANAGERS; ELECTION; DEFERRED COMPENSATION.] 
143.33     Subdivision 1.  [DEFINITIONS.] (a) For purposes of this 
143.34  section, each of the terms in this subdivision has the meaning 
143.35  indicated. 
143.36     (b) "City manager" means (1) a person who is duly appointed 
144.1   to and is holding the position of city manager in a Plan B 
144.2   statutory city or in a home rule city operating under the 
144.3   "council-manager" form of government, or (2) a person who is 
144.4   appointed to and is holding the position of chief administrative 
144.5   officer of a home rule charter city or a statutory city pursuant 
144.6   to under a charter provision, ordinance, or resolution 
144.7   establishing such a position and prescribing its duties and 
144.8   responsibilities.  
144.9      (c) "Governing body" means the city council of the city 
144.10  employing the city manager.  
144.11     (d) "Election" means the election described in subdivision 
144.12  2.  
144.13     Subd. 2.  [ELECTION.] (a) A city manager may elect to be 
144.14  excluded from membership in the general employees retirement 
144.15  plan of the Public Employees Retirement Association.  The 
144.16  election of exclusion must be made within six months following 
144.17  the commencement of employment, must be made in writing on a 
144.18  form prescribed by the executive director, and must be approved 
144.19  by a resolution of adopted by the governing body of the city.  
144.20  The election of exclusion is not effective until it is filed 
144.21  with the executive director.  Membership of a city manager in 
144.22  the association general employees retirement plan ceases on the 
144.23  date the written election is received by the executive director 
144.24  or upon a later date specified.  Employee and employer 
144.25  contributions made on behalf of a person exercising the option 
144.26  to be excluded from membership under this section must be 
144.27  refunded in accordance with section 353.27, subdivision 7. 
144.28     (b) A city manager who has elected exclusion under this 
144.29  subdivision may elect to revoke that action by filing a written 
144.30  notice with the executive director.  The notice must be on a 
144.31  form prescribed by the executive director and must be approved 
144.32  by a resolution of the governing body of the city.  Membership 
144.33  of the city manager in the association resumes prospectively 
144.34  from the date of the first day of the pay period for which 
144.35  contributions were deducted or, if pay period coverage dates are 
144.36  not provided, the date on which the notice of revocation or 
145.1   contributions are received in the office of the association, 
145.2   provided that the notice of revocation is received by the 
145.3   association within 60 days of the receipt of contributions. 
145.4      (c) An election under paragraph (b) is irrevocable.  Any 
145.5   election under paragraph (a) or (b) must include a statement 
145.6   that the individual will not seek authorization to purchase 
145.7   service credit for any period of excluded service. 
145.8      Subd. 3.  [DEFERRED COMPENSATION; CITY CONTRIBUTION.] If an 
145.9   election of exclusion is made, and if the city manager and the 
145.10  governing body of the city additionally agree in writing that 
145.11  the additional compensation is to be deferred and shall is to be 
145.12  contributed on behalf of the city manager to a deferred 
145.13  compensation program which meets the requirements of section 457 
145.14  of the Internal Revenue Code of 1954 1986, as amended through 
145.15  December 31, 1980, the governing body may compensate the city 
145.16  manager, in addition to the salary allowed under any limitation 
145.17  imposed on salaries by law or charter, in an amount equal to the 
145.18  employer contribution which would be required by section 353.27, 
145.19  subdivision 3, if the city manager were a member of the 
145.20  association general employees retirement plan.  
145.21     Subd. 4.  [REFUNDS; DEFERRED ANNUITY.] A city manager who 
145.22  makes an election to be excluded from membership is entitled to 
145.23  a refund of accumulated deductions or, if otherwise qualified, a 
145.24  deferred annuity in the manner provided by under section 353.34, 
145.25  at the option of the manager.  
145.26     Subd. 5.  [ELECTION; OTHER EMPLOYMENT.] If a city manager 
145.27  who has made an election to be excluded subsequently accepts 
145.28  employment in another governmental subdivision or subsequently 
145.29  accepts employment other than as a city manager in the same 
145.30  city, the election shall be deemed to have been is rescinded on 
145.31  the effective date of employment.  
145.32     Sec. 44.  Minnesota Statutes 2004, section 353.14, is 
145.33  amended to read: 
145.34     353.14 [BENEFITS FROM OTHER FUNDS.] 
145.35     No annuity or benefit provided by this chapter shall may be 
145.36  affected, diminished, or impaired by any pension, benefit, or 
146.1   annuity which any member or survivor is entitled to receive from 
146.2   a tax supported public retirement plan or system authorized by 
146.3   any other law, for based on service that is different service 
146.4   than the service for which the member or survivor is entitled to 
146.5   receive benefit or annuity from a retirement plan administered 
146.6   by the Public Employees Retirement Association. 
146.7      Sec. 45.  Minnesota Statutes 2004, section 353.15, 
146.8   subdivision 1, is amended to read: 
146.9      Subdivision 1.  [EXEMPTION; EXCEPTIONS.] No money, annuity, 
146.10  or benefit provided for in this chapter is assignable or subject 
146.11  to execution, levy, attachment, garnishment, or legal process, 
146.12  except as provided in subdivision 2 or section 518.58, 518.581, 
146.13  or 518.6111. The provisions of section 356.401 apply to the 
146.14  general employees retirement plan, to the public employees 
146.15  police and fire retirement plan, and to the local government 
146.16  correctional service retirement plan.  
146.17     Sec. 46.  Minnesota Statutes 2004, section 353.15, 
146.18  subdivision 3, is amended to read: 
146.19     Subd. 3.  [PAYMENT TO PUBLIC BODIES.] If, in the judgment 
146.20  of the executive director, conditions so warrant, payment of an 
146.21  annuity, a retirement benefit, or a refund may be made to a 
146.22  public body in behalf of an annuitant, disabilitant, or survivor 
146.23  upon such terms as the executive director may prescribe. 
146.24     Sec. 47.  Minnesota Statutes 2004, section 353.27, 
146.25  subdivision 11, is amended to read: 
146.26     Subd. 11.  [EMPLOYERS; REQUIRED TO FURNISH REQUESTED 
146.27  INFORMATION.] (a) All governmental subdivisions shall furnish 
146.28  promptly such other information relative to the employment 
146.29  status of all employees or former employees, including, but not 
146.30  limited to, payroll abstracts pertaining to all past and present 
146.31  employees, as may be requested by the association or its 
146.32  executive director, including schedules of salaries applicable 
146.33  to various categories of employment.  
146.34     (b) In the event payroll abstract records have been lost or 
146.35  destroyed, for whatever reason or in whatever manner, so that 
146.36  such schedules of salaries cannot be furnished therefrom, the 
147.1   employing governmental subdivision, in lieu thereof, shall 
147.2   furnish to the association an estimate of the earnings of any 
147.3   employee or former employee for any period as may be requested 
147.4   by the association or its executive director.  Should If the 
147.5   association receive such schedules is provided a schedule of 
147.6   estimated earnings, the executive director is hereby authorized 
147.7   to use the same as a basis for making whatever computations 
147.8   might be necessary for determining obligations of the employee 
147.9   and employer to the retirement fund.  If estimates are not 
147.10  furnished by the employer pursuant to at the request of the 
147.11  association or its executive director, the association executive 
147.12  director may estimate the obligations of the employee and 
147.13  employer to the retirement fund based upon such those records as 
147.14  that are in its possession.  Where payroll abstracts have been 
147.15  lost or destroyed, the governmental agency need not furnish any 
147.16  information pertaining to employment prior to July 1, 1963.  The 
147.17  association shall make no estimate of any obligation of any 
147.18  employee, former employee, or employer covering employment prior 
147.19  to July 1, 1963. 
147.20     Sec. 48.  Minnesota Statutes 2004, section 353.271, is 
147.21  amended to read: 
147.22     353.271 [PARTICIPATION IN MINNESOTA POSTRETIREMENT 
147.23  INVESTMENT FUND.] 
147.24     Subdivision 1.  [AUTHORIZATION.] The general employees 
147.25  retirement plan of the Public Employees Retirement Association, 
147.26  including the public employees police and fire fund but 
147.27  excluding the various local relief association consolidation 
147.28  accounts, is retirement plan, and the local government 
147.29  correctional service retirement plan are authorized to 
147.30  participate in the Minnesota postretirement investment fund.  
147.31  There shall be is one general participation in the Minnesota 
147.32  postretirement investment fund for all purposes by each plan of 
147.33  the Public Employees Retirement fund and one general 
147.34  participation in the Minnesota postretirement investment fund 
147.35  for all purposes by the public employees police and fire 
147.36  fund Association. 
148.1      Subd. 2.  [VALUATION OF ASSETS; ADJUSTMENT OF BENEFITS.] 
148.2   (1) (a) The required reserves for retirement annuities payable 
148.3   as provided in this chapter other than those payable from the 
148.4   various local relief association consolidation accounts, as 
148.5   determined in accordance with the appropriate mortality table 
148.6   adopted by the board of trustees based on the experience of the 
148.7   fund as recommended by the actuary retained by the Legislative 
148.8   Commission on Pensions and Retirement under section 356.214, and 
148.9   approved under section 356.215, subdivision 18, and using the 
148.10  postretirement interest assumption specified in section 356.215, 
148.11  subdivision 8, shall must be transferred to the Minnesota 
148.12  postretirement investment fund as of the last business day of 
148.13  the month in which the retirement annuity begins.  
148.14     (2) (b) Annuity payments other than those payable from the 
148.15  various local relief association consolidation accounts 
148.16  shall must be adjusted in accordance with the provisions of 
148.17  section 11A.18.  
148.18     (3) (c) Increases in payments pursuant to under this 
148.19  section or from the various local relief association 
148.20  consolidation accounts, if applicable, will must be made 
148.21  automatically unless the intended recipient files written notice 
148.22  with the executive director of the Public Employees Retirement 
148.23  Association requesting that the increase shall not be made. 
148.24     Sec. 49.  Minnesota Statutes 2004, section 353.31, 
148.25  subdivision 1c, is amended to read: 
148.26     Subd. 1c.  [COORDINATED MEMBERS.] Except for benefits 
148.27  provided under section 353.32, subdivisions 1 and 1a, no 
148.28  survivor benefits are payable to the surviving spouse or 
148.29  dependent children of a deceased coordinated member. 
148.30     Sec. 50.  Minnesota Statutes 2004, section 353.32, 
148.31  subdivision 9, is amended to read: 
148.32     Subd. 9.  [PAYMENT TO A MINOR.] If a member or former 
148.33  member dies having named as beneficiary a person who is a minor 
148.34  at the time of the application for refund, the board may make 
148.35  the payment (a) (1) directly to the minor, (b) (2) to any 
148.36  a person who has legally qualified and is acting as guardian of 
149.1   the minor's person or property in any jurisdiction, or (c) (3) 
149.2   to either parent of the minor or to any an adult person with 
149.3   whom the minor may at the time be living, provided only that.  
149.4   The parent or other person to whom any amount is to be 
149.5   paid shall have advised must advise the board in writing that 
149.6   the amount will be held or used in trust for the benefit of such 
149.7   minor.  Any annuity or disability benefit payable at the time of 
149.8   death of an annuitant or recipient of a disability benefit, 
149.9   which is payable to a beneficiary who is a minor, may be paid in 
149.10  the same manner.  Such The payment shall be is a bar to recovery 
149.11  by any other person or persons. 
149.12     Sec. 51.  Minnesota Statutes 2004, section 353.33, 
149.13  subdivision 12, is amended to read: 
149.14     Subd. 12.  [BASIC DISABILITY SURVIVOR BENEFITS.] If a basic 
149.15  member who is receiving a disability benefit under subdivision 3:
149.16     (a) (1) dies before attaining age 65 or within five years 
149.17  of the effective date of the disability, whichever is later, the 
149.18  surviving spouse shall is entitled to receive a survivor benefit 
149.19  under section 353.31, unless the surviving spouse elected to 
149.20  receive a refund under section 353.32, subdivision 1.; 
149.21     (b) (2) is living at age 65 or five years after the 
149.22  effective date of the disability, whichever is later, the basic 
149.23  member may continue to receive a normal disability benefit, or 
149.24  elect a joint and survivor optional annuity under section 
149.25  353.31, subdivision 1b.  The election of the joint and survivor 
149.26  optional annuity must occur within 90 days of attaining age 65 
149.27  or of reaching the five-year anniversary of the effective date 
149.28  of the disability benefit, whichever is later.  The optional 
149.29  annuity takes effect on the first day of the month following the 
149.30  month in which the person attains age 65 or reaches the 
149.31  five-year anniversary of the effective date of the disability 
149.32  benefit, whichever is later.; or 
149.33     (c) (3) if there is a dependent child or children under 
149.34  paragraph (a) or (b) clause (1) or (2), the association shall 
149.35  grant dependent child is entitled to a dependent child benefit 
149.36  under section 353.31, subdivision 1b, paragraph (b). 
150.1      Sec. 52.  Minnesota Statutes 2004, section 354.091, is 
150.2   amended to read: 
150.3      354.091 [SERVICE CREDIT.] 
150.4      (a) In computing service credit, no teacher shall may 
150.5   receive credit for more than one year of teaching service for 
150.6   any fiscal year.  Commencing July 1, 1961 Additionally, in 
150.7   crediting allowable service: 
150.8      (1) if a teacher teaches less than five hours in a day, 
150.9   service credit must be given for the fractional part of the day 
150.10  as the term of service performed bears to five hours; 
150.11     (2) if a teacher teaches five or more hours in a day, 
150.12  service credit must be given for only one day; 
150.13     (3) if a teacher teaches at least 170 full days in any 
150.14  fiscal year, service credit must be given for a full year of 
150.15  teaching service; and 
150.16     (4) if a teacher teaches for only a fractional part of the 
150.17  year, service credit must be given for such fractional part of 
150.18  the year in the same relationship as the period of service 
150.19  performed bears to 170 days. 
150.20     (b) A teacher shall must receive a full year of service 
150.21  credit based on the number of days in the employer's full school 
150.22  year if it that school year is less than 170 days.  Teaching 
150.23  service performed before July 1, 1961, must be computed under 
150.24  the law in effect at the time it was performed. 
150.25     (c) A teacher must not lose or gain retirement service 
150.26  credit as a result of the employer converting to a flexible or 
150.27  alternate work schedule.  If the employer converts to a flexible 
150.28  or alternate work schedule, the forms for reporting teaching 
150.29  service and the procedures for determining service credit must 
150.30  be determined by the executive director with the approval of the 
150.31  board of trustees.  
150.32     (d) For all services rendered on or after July 1, 2003, 
150.33  service credit for all members employed by the Minnesota State 
150.34  Colleges and Universities system must be determined: 
150.35     (1) for full-time employees, by the definition of full-time 
150.36  employment contained in the collective bargaining agreement for 
151.1   those units listed in section 179A.10, subdivision 2, or 
151.2   contained in the applicable personnel or salary plan for those 
151.3   positions designated in section 179A.10, subdivision 1; 
151.4      (2) for part-time employees, by the appropriate proration 
151.5   of full-time equivalency based on the provisions contained in 
151.6   the collective bargaining agreement for those units listed in 
151.7   section 179A.10, subdivision 2, or contained in the applicable 
151.8   personnel or salary plan for those positions designated in 
151.9   section 179A.10, subdivision 1, and the applicable procedures of 
151.10  the Minnesota State Colleges and Universities system; and 
151.11     (3) in no case may a member receive more than one year of 
151.12  service credit for any fiscal year. 
151.13     Sec. 53.  Minnesota Statutes 2004, section 354.10, 
151.14  subdivision 1, is amended to read: 
151.15     Subdivision 1.  [EXEMPTION; EXCEPTIONS.] (a) The provisions 
151.16  of section 356.401 apply to the teachers retirement plan.  
151.17     (b) The right of a teacher to take advantage of the 
151.18  benefits provided by this chapter, is a personal right only and 
151.19  is not assignable.  All money to the credit of a teacher's 
151.20  account in the fund or any money payable to the teacher from the 
151.21  fund belongs to the state of Minnesota until actually paid to 
151.22  the teacher or a beneficiary under this chapter.  
151.23     (c) The association may acknowledge a properly completed 
151.24  power of attorney form.  An assignment or attempted assignment 
151.25  of a teacher's interest in the fund, or of the beneficiary's 
151.26  interest in the fund, by a teacher or a beneficiary is void and 
151.27  exempt from garnishment or levy under attachment or execution, 
151.28  except as provided in subdivision 2 or 3, or section 518.58, 
151.29  518.581, or 518.6111.  
151.30     Sec. 54.  Minnesota Statutes 2004, section 354.10, 
151.31  subdivision 3, is amended to read: 
151.32     Subd. 3.  [PAYMENT TO PUBLIC BODIES.] If, in the judgment 
151.33  of the executive director, conditions so warrant, payment of an 
151.34  annuity, a retirement benefit, or a refund may be made to a 
151.35  public body in behalf of an annuitant, disabilitant, or survivor 
151.36  upon such terms as the executive director may prescribe.  
152.1      Sec. 55.  Minnesota Statutes 2004, section 354.10, 
152.2   subdivision 4, is amended to read: 
152.3      Subd. 4.  [CHANGES IN DESIGNATED BENEFICIARIES.] Any (a) A 
152.4   beneficiary designated by a retiree or member under section 
152.5   354.05, subdivision 22, may be changed or revoked by the retiree 
152.6   or member on a form provided by the executive director.  
152.7      (b) A change or revocation made under this subdivision is 
152.8   valid only if the properly completed form is received by the 
152.9   association on or before the date of death of the retiree or the 
152.10  member.  
152.11     (c) If a designated beneficiary dies before the retiree or 
152.12  member designating the beneficiary, and a new beneficiary is not 
152.13  designated, the retiree's or member's estate is the beneficiary. 
152.14     Sec. 56.  Minnesota Statutes 2004, section 354.33, 
152.15  subdivision 5, is amended to read: 
152.16     Subd. 5.  [RETIREES NOT ELIGIBLE FOR FEDERAL BENEFITS.] 
152.17  Notwithstanding the provisions of section 354.55, subdivision 3, 
152.18  when any person retires after July 1, 1973, who (a) (1) has ten 
152.19  or more years of allowable service, and (b) (2) does not have 
152.20  any retroactive Social Security coverage by reason of the 
152.21  person's position in the retirement system, and (c) (3) does not 
152.22  qualify for federal old age and survivor primary benefits at the 
152.23  time of retirement, the annuity shall must be computed under 
152.24  section 354.44, subdivision 2, of the law in effect on June 30, 
152.25  1969, except that accumulations after June 30, 1957, shall must 
152.26  be calculated using the same mortality table and interest 
152.27  assumption as are used to transfer the required reserves to the 
152.28  Minnesota postretirement investment fund. 
152.29     Sec. 57.  Minnesota Statutes 2004, section 354.39, is 
152.30  amended to read: 
152.31     354.39 [EFFECTIVE DATE; APPLICATION.] 
152.32     After July 1, 1971, any A member of the Teachers Retirement 
152.33  Association who is employed in a new state university and or any 
152.34  other new institutions institution of higher learning not 
152.35  included in any agreement or modification made between the state 
152.36  and the federal Secretary of Health, Education and Welfare Human 
153.1   Services, making the provisions of the federal Old Age and, 
153.2   Survivors and Disability Insurance Act applicable to such 
153.3   members, shall must be covered under the provisions of this 
153.4   chapter applicable to coordinated members. 
153.5      Sec. 58.  Minnesota Statutes 2004, section 354.41, 
153.6   subdivision 2, is amended to read: 
153.7      Subd. 2.  [TEACHERS.] Every teacher after June 30, 1957, in 
153.8   the service or entering the service of the state or one of its 
153.9   governmental subdivision subdivisions as a teacher, except 
153.10  persons specially specifically excluded, shall must become a 
153.11  member of the association by the acceptance of such employment. 
153.12     Sec. 59.  Minnesota Statutes 2004, section 354.42, is 
153.13  amended by adding a subdivision to read: 
153.14     Subd. 1a.  [TEACHERS RETIREMENT FUND.] (a) Within the 
153.15  Teachers Retirement Association and the state treasury is 
153.16  created a special retirement fund, which must include all the 
153.17  assets of the Teachers Retirement Association and all revenue of 
153.18  the association.  The fund is the continuation of the fund 
153.19  established under Laws 1931, chapter 406, section 2, 
153.20  notwithstanding the repeal of Minnesota Statutes 1973, section 
153.21  354.42, subdivision 1, by Laws 1974, chapter 289, section 59. 
153.22     (b) The teachers retirement fund must be credited with all 
153.23  employee and employer contributions, all investment revenue and 
153.24  gains, and all other income authorized by law. 
153.25     (c) From the teachers retirement fund is appropriated the 
153.26  payments of annuities and benefits authorized by this chapter, 
153.27  the transfers to the Minnesota postretirement investment fund, 
153.28  and the reasonable and necessary expenses of administering the 
153.29  fund and the association. 
153.30     Sec. 60.  Minnesota Statutes 2004, section 354.44, 
153.31  subdivision 2, is amended to read: 
153.32     Subd. 2.  [COMPUTATION OF MONEY PURCHASE ANNUITY.] (a) The 
153.33  amount of retirement annuity is an amount equal to double the 
153.34  annuity which could be purchased by the member's accumulated 
153.35  deductions plus interest thereon.  The annuity shall must be 
153.36  determined by the member's age, sex, double the amount of 
154.1   accumulated deductions, double the amount of interest earned on 
154.2   the accumulated deductions, and the appropriate mortality tables 
154.3   and interest rates.  To determine the amount of the annuity for 
154.4   a basic member, the accumulated deductions prior to before July 
154.5   1, 1957, and the accumulated deductions subsequent to after July 
154.6   1, 1957, shall must be considered separately. 
154.7      (1) (b) For service rendered prior to before July 1, 1957, 
154.8   the accumulated deductions for any a member shall must be 
154.9   carried forward at a fixed amount which is shown credited to the 
154.10  member's account as of that date.  That fixed amount shall must 
154.11  also include any payments in lieu of salary deductions which are 
154.12  to be made in the future and are were actually so made pursuant 
154.13  to under an agreement executed between the member and the board 
154.14  as authorized by section 354.50 or any other authorized payments 
154.15  made by the member to the fund.  The annuity granted with 
154.16  respect to the period shall must be determined as follows: 
154.17     (a) (1) the fixed amount of the accumulated deductions for 
154.18  the period including the interest credited on the amount as 
154.19  earned up to July 1, 1957.; and 
154.20     (b) (2) annuity purchase rates based on the applicable 
154.21  mortality table established by the board and the interest rate 
154.22  assumption in effect prior to before July 1, 1957, in the case 
154.23  of basic members and an annuity purchase rate based on an 
154.24  appropriate annuity table of mortality established by the board 
154.25  as provided in section 354.07, subdivision 1, and using the 
154.26  applicable postretirement interest rate assumption specified in 
154.27  section 356.215, subdivision 8, in the case of coordinated 
154.28  members. 
154.29     (2) (c) For service rendered subsequent to after July 1, 
154.30  1957, the accumulated deductions for any a member shall must 
154.31  consist of the amounts actually credited to the member's account 
154.32  by reason of salary deductions.  The annuity granted with 
154.33  respect to the period shall must be determined by the following: 
154.34     (a) (1) accumulated deductions for the period; 
154.35     (b) (2) interest credited on these accumulated deductions 
154.36  from July 1, 1957, to the date of retirement; 
155.1      (c) (3) interest credited on accumulated deductions 
155.2   including prior credited interest provided in paragraph (1) (b) 
155.3   from July 1, 1957, to the date of retirement; 
155.4      (d) (4) after the amount available for an annuity granted 
155.5   with respect to the person is determined in accordance with the 
155.6   provisions of this subdivision, an additional amount equal to 20 
155.7   percent of the sum of clause (2)(a) (1) plus interest credited 
155.8   to members a member's account from July 1, 1957, to date of 
155.9   retirement is to be added.  This added amount is not to be 
155.10  doubled as provided for other amounts determined in this 
155.11  subdivision; and 
155.12     (e) (5) the annuity purchase rate based on an appropriate 
155.13  annuity table of mortality established by the board as provided 
155.14  in section 354.07, subdivision 1, and using the applicable 
155.15  postretirement interest rate assumption specified in section 
155.16  356.215, subdivision 8. 
155.17     Sec. 61.  Minnesota Statutes 2004, section 354A.021, 
155.18  subdivision 5, is amended to read: 
155.19     Subd. 5.  [TAX SHELTERED ANNUITY PROGRAM AND FUND.] Any A 
155.20  teachers retirement fund association may establish a tax 
155.21  sheltered annuity program and fund meeting the requirements of 
155.22  section 403(b) of the Internal Revenue Code of 1986, as amended 
155.23  through December 31, 1992, which shall must include all assets 
155.24  which were acquired for the specific purpose of being credited 
155.25  to the program and fund and to which shall must be credited all 
155.26  employee contributions, and employer contributions, if 
155.27  negotiated under a collective bargaining agreement, designated 
155.28  for this purpose and all interest income attributable to the 
155.29  assets of the program and fund.  
155.30     Sec. 62.  Minnesota Statutes 2004, section 354A.097, 
155.31  subdivision 1, is amended to read: 
155.32     Subdivision 1.  [SERVICE CREDIT PURCHASE AUTHORIZED.] A 
155.33  teacher who has at least three years of allowable service credit 
155.34  with the teachers retirement fund association and who performed 
155.35  service in the United States armed forces before becoming a 
155.36  teacher as defined in section 354A.011, subdivision 27, or who 
156.1   failed to obtain service credit for a military leave of absence 
156.2   period under section 354A.093, is entitled to purchase allowable 
156.3   service credit for the initial period of enlistment, induction, 
156.4   or call to active duty without any voluntary extension by making 
156.5   payment under section 356.55 provided 356.551 if the teacher has 
156.6   not purchased service credit from another Minnesota defined 
156.7   benefit public employee pension plan for the same period of 
156.8   service. 
156.9      Sec. 63.  Minnesota Statutes 2004, section 354A.31, 
156.10  subdivision 5, is amended to read: 
156.11     Subd. 5.  [UNREDUCED NORMAL RETIREMENT ANNUITY.] Upon 
156.12  retirement at normal retirement age with at least three years of 
156.13  service credit, a coordinated member shall be is entitled to a 
156.14  normal retirement annuity calculated pursuant to under 
156.15  subdivision 4 or 4a, whichever applies.  
156.16     Sec. 64.  [356.401] [EXEMPTION FROM PROCESS.] 
156.17     Subdivision 1.  [EXEMPTION; EXCEPTIONS.] None of the money, 
156.18  annuities, or other benefits provided for in the governing law 
156.19  of a covered retirement plan is assignable either in law or in 
156.20  equity or subject to state estate tax, or to execution, levy, 
156.21  attachment, garnishment, or other legal process, except as 
156.22  provided in subdivision 2 or section 518.58, 518.581, or 
156.23  518.6111.  
156.24     Subd. 2.  [AUTOMATIC DEPOSITS.] (a) The chief 
156.25  administrative officer of a covered retirement plan may remit, 
156.26  through an automatic deposit system, annuity, benefit, or refund 
156.27  payments only to a financial institution associated with the 
156.28  National Automated Clearinghouse Association or a comparable 
156.29  successor organization that is trustee for a person who is 
156.30  eligible to receive the annuity, benefit, or refund.  
156.31     (b) Upon the request of a retiree, disabilitant, survivor, 
156.32  or former member, the chief administrative officer of a covered 
156.33  retirement plan may remit the annuity, benefit, or refund check 
156.34  to the applicable financial institution for deposit in the 
156.35  person's individual account or the person's joint account.  An 
156.36  overpayment to a joint account after the death of the annuitant 
157.1   or benefit recipient must be repaid to the fund of the 
157.2   applicable covered retirement plan by the joint tenant if the 
157.3   overpayment is not repaid to that fund by the financial 
157.4   institution associated with the National Automated Clearinghouse 
157.5   Association or its successor.  The governing board of the 
157.6   covered retirement plan may prescribe the conditions under which 
157.7   these payments may be made.  
157.8      Subd. 3.  [COVERED RETIREMENT PLANS.] The provisions of 
157.9   this section apply to the following retirement plans: 
157.10     (1) the legislators retirement plan, established by chapter 
157.11  3A; 
157.12     (2) the general state employees retirement plan of the 
157.13  Minnesota State Retirement System, established by chapter 352; 
157.14     (3) the correctional state employees retirement plan of the 
157.15  Minnesota State Retirement System, established by chapter 352; 
157.16     (4) the State Patrol retirement plan, established by 
157.17  chapter 352B; 
157.18     (5) the elective state officers retirement plan, 
157.19  established by chapter 352C; 
157.20     (6) the unclassified state employees retirement program, 
157.21  established by chapter 352D; 
157.22     (7) the general employees retirement plan of the Public 
157.23  Employees Retirement Association, established by chapter 353; 
157.24     (8) the public employees police and fire plan of the Public 
157.25  Employees Retirement Association, established by chapter 353; 
157.26     (9) the public employees defined contribution plan, 
157.27  established by chapter 353D; 
157.28     (10) the local government correctional service retirement 
157.29  plan of the Public Employees Retirement Association, established 
157.30  by chapter 353E; 
157.31     (11) the Teachers Retirement Association, established by 
157.32  chapter 354; 
157.33     (12) the Duluth Teachers Retirement Fund Association, 
157.34  established by chapter 354A; 
157.35     (13) the Minneapolis Teachers Retirement Fund Association, 
157.36  established by chapter 354A; 
158.1      (14) the St. Paul Teachers Retirement Fund Association, 
158.2   established by chapter 354A; 
158.3      (15) the individual retirement account plan, established by 
158.4   chapter 354B; 
158.5      (16) the higher education supplemental retirement plan, 
158.6   established by chapter 354C; 
158.7      (17) the Minneapolis employees retirement fund, established 
158.8   by chapter 422A; 
158.9      (18) the Minneapolis Police Relief Association, established 
158.10  by chapter 423B; 
158.11     (19) the Minneapolis Firefighters Relief Association, 
158.12  established by chapter 423C; and 
158.13     (20) the judges retirement fund, established by sections 
158.14  490.121 to 490.132.  
158.15     Sec. 65.  Minnesota Statutes 2004, section 356.551, is 
158.16  amended to read: 
158.17     356.551 [POST JULY 1, 2003 2004, PRIOR SERVICE CREDIT 
158.18  PURCHASE PAYMENT AMOUNT DETERMINATION PROCEDURE.] 
158.19     Subdivision 1.  [APPLICATION.] (a) Unless the prior service 
158.20  credit purchase authorization special law or general statute 
158.21  provision explicitly specifies a different purchase payment 
158.22  amount determination procedure, and if section 356.55 has 
158.23  expired, this section governs the determination of the prior 
158.24  service credit purchase payment amount of any prior service 
158.25  credit purchase. 
158.26     (b) The purchase payment amount determination procedure 
158.27  must recognize any service credit accrued to the purchaser in a 
158.28  pension plan enumerated in section 356.30, subdivision 3. 
158.29     (c) Any service credit in a Minnesota defined benefit 
158.30  public employee pension plan available to be reinstated by the 
158.31  purchaser through the repayment of a refund of member or 
158.32  employee contributions previously received must be repaid in 
158.33  full before any purchase of prior service credit payment is made 
158.34  under this section. 
158.35     Subd. 2.  [DETERMINATION.] (a) Unless the minimum purchase 
158.36  amount set forth in paragraph (c) applies, the prior service 
159.1   credit purchase amount is an amount equal to the actuarial 
159.2   present value, on the date of payment, as calculated by the 
159.3   chief administrative officer of the pension plan and reviewed by 
159.4   the actuary retained by the Legislative Commission on Pensions 
159.5   and Retirement under section 356.214, of the amount of the 
159.6   additional retirement annuity obtained by the acquisition of the 
159.7   additional service credit in this section.  
159.8      (b) Calculation of this amount must be made using the 
159.9   preretirement interest rate applicable to the public pension 
159.10  plan specified in section 356.215, subdivision 4d 8, and the 
159.11  mortality table adopted for the public pension plan.  The 
159.12  calculation must assume continuous future service in the public 
159.13  pension plan until, and retirement at, the age at which the 
159.14  minimum requirements of the fund for normal retirement or 
159.15  retirement with an annuity unreduced for retirement at an early 
159.16  age, including section 356.30, are met with the additional 
159.17  service credit purchased.  The calculation must also assume a 
159.18  full-time equivalent salary, or actual salary, whichever is 
159.19  greater, and a future salary history that includes annual salary 
159.20  increases at the applicable salary increase rate for the plan 
159.21  specified in section 356.215, subdivision 4d.  
159.22     (c) The prior service credit purchase amount may not be 
159.23  less than the amount determined by applying the current employee 
159.24  or member contribution rate, the employer contribution rate, and 
159.25  the additional employer contribution rate, if any, to the 
159.26  person's current annual salary and multiplying that result by 
159.27  the number of whole and fraction years of service to be 
159.28  purchased. 
159.29     (d) Payment must be made in one lump sum within one year of 
159.30  the prior service credit authorization.  Payment of the amount 
159.31  calculated under this section must be made by the applicable 
159.32  eligible person.  
159.33     (e) However, the current employer or the prior employer 
159.34  may, at its discretion, pay all or any portion of the payment 
159.35  amount that exceeds an amount equal to the employee contribution 
159.36  rates in effect during the period or periods of prior service 
160.1   applied to the actual salary rates in effect during the period 
160.2   or periods of prior service, plus interest at the rate of 8.5 
160.3   percent a year compounded annually from the date on which the 
160.4   contributions would otherwise have been made to the date on 
160.5   which the payment is made.  If the employer agrees to payments 
160.6   under this subdivision, the purchaser must make the employee 
160.7   payments required under this subdivision within 290 90 days of 
160.8   the prior service credit authorization.  If that employee 
160.9   payment is made, the employer payment under this subdivision 
160.10  must be remitted to the chief administrative officer of the 
160.11  public pension plan within 60 days of receipt by the chief 
160.12  administrative officer of the employee payments specified under 
160.13  this subdivision. 
160.14     Subd. 3.  [DOCUMENTATION.] The prospective prior service 
160.15  credit purchaser must provide any relevant documentation 
160.16  required by the chief administrative officer of the applicable 
160.17  public pension plan to determine eligibility for the prior 
160.18  service credit under this section. 
160.19     Subd. 4.  [PAYMENT PRECONDITION FOR CREDIT GRANT.] Service 
160.20  credit for the purchase period must be granted by the public 
160.21  pension plan to the purchaser upon receipt of the full purchase 
160.22  payment amount specified in subdivision 2. 
160.23     Sec. 66.  Minnesota Statutes 2004, section 356A.06, 
160.24  subdivision 7, is amended to read: 
160.25     Subd. 7.  [EXPANDED LIST OF AUTHORIZED INVESTMENT 
160.26  SECURITIES.] (a)  [AUTHORITY.] Except to the extent otherwise 
160.27  authorized by law or bylaws, a covered pension plan not 
160.28  described by subdivision 6, paragraph (a), may invest its assets 
160.29  only in accordance with this subdivision. 
160.30     (b)  [SECURITIES GENERALLY.] The covered pension plan has 
160.31  the authority to purchase, sell, lend, or exchange the 
160.32  securities specified in paragraphs (c) to (g), including puts 
160.33  and call options and future contracts traded on a contract 
160.34  market regulated by a governmental agency or by a financial 
160.35  institution regulated by a governmental agency.  These 
160.36  securities may be owned as units in commingled trusts that own 
161.1   the securities described in paragraphs (c) to (g).  
161.2      (c)  [GOVERNMENT OBLIGATIONS.] The covered pension plan may 
161.3   invest funds in governmental bonds, notes, bills, mortgages, and 
161.4   other evidences of indebtedness provided the issue is backed by 
161.5   the full faith and credit of the issuer or the issue is rated 
161.6   among the top four quality rating categories by a nationally 
161.7   recognized rating agency.  The obligations in which funds may be 
161.8   invested under this paragraph include guaranteed or insured 
161.9   issues of (1) the United States, its agencies, its 
161.10  instrumentalities, or organizations created and regulated by an 
161.11  act of Congress; (2) Canada and its provinces, provided the 
161.12  principal and interest is payable in United States dollars; (3) 
161.13  the states and their municipalities, political subdivisions, 
161.14  agencies, or instrumentalities; (4) the International Bank for 
161.15  Reconstruction and Development, the Inter-American Development 
161.16  Bank, the Asian Development Bank, the African Development Bank, 
161.17  or any other United States government sponsored organization of 
161.18  which the United States is a member, provided the principal and 
161.19  interest is payable in United States dollars. 
161.20     (d)  [CORPORATE OBLIGATIONS.] The covered pension plan may 
161.21  invest funds in bonds, notes, debentures, transportation 
161.22  equipment obligations, or any other longer term evidences of 
161.23  indebtedness issued or guaranteed by a corporation organized 
161.24  under the laws of the United States or any state thereof, or the 
161.25  Dominion of Canada or any province thereof if they conform to 
161.26  the following provisions: 
161.27     (1) the principal and interest of obligations of 
161.28  corporations incorporated or organized under the laws of the 
161.29  Dominion of Canada or any province thereof must be payable in 
161.30  United States dollars; and 
161.31     (2) obligations must be rated among the top four quality 
161.32  categories by a nationally recognized rating agency. 
161.33     (e)  [OTHER OBLIGATIONS.] (1) The covered pension plan may 
161.34  invest funds in bankers acceptances, certificates of deposit, 
161.35  deposit notes, commercial paper, mortgage participation 
161.36  certificates and pools, asset backed securities, repurchase 
162.1   agreements and reverse repurchase agreements, guaranteed 
162.2   investment contracts, savings accounts, and guaranty fund 
162.3   certificates, surplus notes, or debentures of domestic mutual 
162.4   insurance companies if they conform to the following provisions: 
162.5      (i) bankers acceptances and deposit notes of United States 
162.6   banks are limited to those issued by banks rated in the highest 
162.7   four quality categories by a nationally recognized rating 
162.8   agency; 
162.9      (ii) certificates of deposit are limited to those issued by 
162.10  (A) United States banks and savings institutions that are rated 
162.11  in the highest four quality categories by a nationally 
162.12  recognized rating agency or whose certificates of deposit are 
162.13  fully insured by federal agencies; or (B) credit unions in 
162.14  amounts up to the limit of insurance coverage provided by the 
162.15  National Credit Union Administration; 
162.16     (iii) commercial paper is limited to those issued by United 
162.17  States corporations or their Canadian subsidiaries and rated in 
162.18  the highest two quality categories by a nationally recognized 
162.19  rating agency; 
162.20     (iv) mortgage participation or pass through certificates 
162.21  evidencing interests in pools of first mortgages or trust deeds 
162.22  on improved real estate located in the United States where the 
162.23  loan to value ratio for each loan as calculated in accordance 
162.24  with section 61A.28, subdivision 3, does not exceed 80 percent 
162.25  for fully amortizable residential properties and in all other 
162.26  respects meets the requirements of section 61A.28, subdivision 
162.27  3; 
162.28     (v) collateral for repurchase agreements and reverse 
162.29  repurchase agreements is limited to letters of credit and 
162.30  securities authorized in this section; 
162.31     (vi) guaranteed investment contracts are limited to those 
162.32  issued by insurance companies or banks rated in the top four 
162.33  quality categories by a nationally recognized rating agency or 
162.34  to alternative guaranteed investment contracts where the 
162.35  underlying assets comply with the requirements of this 
162.36  subdivision; 
163.1      (vii) savings accounts are limited to those fully insured 
163.2   by federal agencies; and 
163.3      (viii) asset backed securities must be rated in the top 
163.4   four quality categories by a nationally recognized rating agency.
163.5      (2) Sections 16A.58, 16C.03, subdivision 4, and 16C.05 do 
163.6   not apply to certificates of deposit and collateralization 
163.7   agreements executed by the covered pension plan under clause 
163.8   (1), item (ii). 
163.9      (3) In addition to investments authorized by clause (1), 
163.10  item (iv), the covered pension plan may purchase from the 
163.11  Minnesota Housing Finance Agency all or any part of a pool of 
163.12  residential mortgages, not in default, that has previously been 
163.13  financed by the issuance of bonds or notes of the agency.  The 
163.14  covered pension plan may also enter into a commitment with the 
163.15  agency, at the time of any issue of bonds or notes, to purchase 
163.16  at a specified future date, not exceeding 12 years from the date 
163.17  of the issue, the amount of mortgage loans then outstanding and 
163.18  not in default that have been made or purchased from the 
163.19  proceeds of the bonds or notes.  The covered pension plan may 
163.20  charge reasonable fees for any such commitment and may agree to 
163.21  purchase the mortgage loans at a price sufficient to produce a 
163.22  yield to the covered pension plan comparable, in its judgment, 
163.23  to the yield available on similar mortgage loans at the date of 
163.24  the bonds or notes.  The covered pension plan may also enter 
163.25  into agreements with the agency for the investment of any 
163.26  portion of the funds of the agency.  The agreement must cover 
163.27  the period of the investment, withdrawal privileges, and any 
163.28  guaranteed rate of return. 
163.29     (f)  [CORPORATE STOCKS.] The covered pension plan may 
163.30  invest funds in stocks or convertible issues of any corporation 
163.31  organized under the laws of the United States or the states 
163.32  thereof, the Dominion of Canada or its provinces, or any 
163.33  corporation listed on the New York Stock Exchange or the 
163.34  American Stock Exchange, if they conform to the following 
163.35  provisions: 
163.36     (1) the aggregate value of corporate stock investments, as 
164.1   adjusted for realized profits and losses, must not exceed 85 
164.2   percent of the market or book value, whichever is less, of a 
164.3   fund, less the aggregate value of investments according to 
164.4   subdivision 6 paragraph (g); 
164.5      (2) investments must not exceed five percent of the total 
164.6   outstanding shares of any one corporation. 
164.7      (g)  [OTHER INVESTMENTS.] (1) In addition to the 
164.8   investments authorized in paragraphs (b) to (f), and subject to 
164.9   the provisions in clause (2), the covered pension plan may 
164.10  invest funds in:  
164.11     (i) venture capital investment businesses through 
164.12  participation in limited partnerships and corporations; 
164.13     (ii) real estate ownership interests or loans secured by 
164.14  mortgages or deeds of trust through investment in limited 
164.15  partnerships, bank sponsored collective funds, trusts, and 
164.16  insurance company commingled accounts, including separate 
164.17  accounts; 
164.18     (iii) regional and mutual funds through bank sponsored 
164.19  collective funds and open-end investment companies registered 
164.20  under the Federal Investment Company Act of 1940; 
164.21     (iv) resource investments through limited partnerships, 
164.22  private placements, and corporations; and 
164.23     (v) international securities. 
164.24     (2) The investments authorized in clause (1) must conform 
164.25  to the following provisions:  
164.26     (i) the aggregate value of all investments made according 
164.27  to clause (1) may not exceed 35 percent of the market value of 
164.28  the fund for which the covered pension plan is investing; 
164.29     (ii) there must be at least four unrelated owners of the 
164.30  investment other than the state board covered pension plan for 
164.31  investments made under clause (1), item (i), (ii), (iii), or 
164.32  (iv); 
164.33     (iii) covered pension plan participation in an investment 
164.34  vehicle is limited to 20 percent thereof for investments made 
164.35  under clause (1), item (i), (ii), (iii), or (iv); and 
164.36     (iv) covered pension plan participation in a limited 
165.1   partnership does not include a general partnership interest or 
165.2   other interest involving general liability.  The covered pension 
165.3   plan may not engage in any activity as a limited partner which 
165.4   creates general liability. 
165.5      Sec. 67.  Minnesota Statutes 2004, section 422A.01, 
165.6   subdivision 11, is amended to read: 
165.7      Subd. 11.  [EMPLOYEE.] "Employee" means any a person who is 
165.8   not exempted from the contributing class pursuant to under 
165.9   section 422A.09, subdivision 3, who is was employed before July 
165.10  1, 1979, by and paid, in whole or in part, by the city or any of 
165.11  its boards, departments, or commissions, operated as a 
165.12  department of city government or independently if financed in 
165.13  whole or in part by city funds, including any a person who was 
165.14  employed by a public corporation as herein defined, and 
165.15  including any a person who was employed before July 1, 1979, by 
165.16  Special School District No. 1, and who is not a member of any 
165.17  other retirement system, and also including any a person who is 
165.18  was employed before July 1, 1973, by the county of Hennepin, who 
165.19  was entitled by law to elect and has elected to retain 
165.20  membership in the municipal Minneapolis Employees Retirement 
165.21  Fund and who makes any required member contributions to the fund 
165.22  and who remains so employed. 
165.23     Sec. 68.  Minnesota Statutes 2004, section 422A.06, 
165.24  subdivision 7, is amended to read: 
165.25     Subd. 7.  [DISABILITY BENEFIT FUND.] (a) The required 
165.26  reserves for disability allowances which become effective after 
165.27  December 31, 1973, shall be transferred from the deposit 
165.28  accumulation fund to the A disability benefit fund is 
165.29  established, containing the required reserves for disability 
165.30  allowances under this chapter.  A proportionate share of income 
165.31  from investments shall must be allocated to this fund.  
165.32  There shall must be paid from this fund the disability 
165.33  allowances which become effective after December 31, 1973 
165.34  payable under this chapter. 
165.35     (b) In the event of the termination of any disability 
165.36  allowance for any reason other than the death of the recipient, 
166.1   the balance of the required reserves for the disability 
166.2   allowance as of the date of the termination shall must be 
166.3   transferred from the disability benefit fund to the deposit 
166.4   accumulation fund. 
166.5      (c) At the end of each fiscal year, as part of the annual 
166.6   actuarial valuation, a determination shall must be made of the 
166.7   required reserves for all disability allowances being paid from 
166.8   the disability benefit fund.  Any excess of assets over 
166.9   actuarial required reserves in the disability benefit fund shall 
166.10  must be transferred to the deposit accumulation fund.  Any 
166.11  excess of actuarial reserves over assets in the disability 
166.12  benefit fund shall must be funded by a transfer of the 
166.13  appropriate amount of assets from the deposit accumulation fund. 
166.14     Sec. 69.  Minnesota Statutes 2004, section 422A.10, 
166.15  subdivision 1, is amended to read: 
166.16     Subdivision 1.  [MEMBER CONTRIBUTION RATE; DEDUCTIONS.] (a) 
166.17  There shall must be deducted and withheld from the basic salary, 
166.18  pay or compensation of each employee in the contributing class, 
166.19  prior to January 1, 1980 an amount equal to 7-1/4 percent, after 
166.20  December 31, 1979 but prior to January 1, 1981 an amount equal 
166.21  to 8-1/4 percent and after December 31, 1980 an amount equal to 
166.22  9-1/4 percent of such salary, pay or compensation, except as 
166.23  hereinafter provided.  
166.24     (b) The retirement board may increase the percentage rate 
166.25  of contribution to the retirement fund of any employee or 
166.26  employees for the purpose of establishing and maintaining on an 
166.27  actuarial basis a plan of insurance, survivors' benefits, or 
166.28  other type of benefit or benefits, the cost of which shall must 
166.29  be paid out of such extra percentage so authorized and deducted 
166.30  from the employee's compensation, except as hereinafter 
166.31  provided.  Any plan or plans so established and placed in 
166.32  operation may be amended from time to time, or may be abandoned, 
166.33  but if abandoned, any surplus remaining from the operation of a 
166.34  plan shall must be the property of the fund, and shall must be 
166.35  credited to the reserve for loss in investment account. 
166.36     Sec. 70.  Minnesota Statutes 2004, section 422A.10, 
167.1   subdivision 2, is amended to read: 
167.2      Subd. 2.  [CONSENT TO DEDUCTIONS MANDATORY MEMBER 
167.3   CONTRIBUTIONS.] Every employee to whom sections 422A.01 to 
167.4   422A.25 this chapter applies who shall continue in the service 
167.5   after the passage of Laws 1919, chapter 522, as well as every 
167.6   person to whom sections 422A.01 to 422A.25 applies who may 
167.7   hereafter be appointed to a position or place, shall be is 
167.8   deemed to consent and agree to the deductions made and provided 
167.9   for herein, and payment with such reductions, for service, shall 
167.10  be are a full and complete discharge and acquittance of all 
167.11  claims and demands for all services rendered by such person 
167.12  during the period covered by such payment; except the person's 
167.13  claim to the benefits to which the person may be entitled under 
167.14  the provisions of sections 422A.01 to 422A.25 this chapter.  
167.15     Sec. 71.  Minnesota Statutes 2004, section 422A.22, 
167.16  subdivision 1, is amended to read: 
167.17     Subdivision 1.  [RETENTION; TRANSFER.] (a) If an employee 
167.18  to whom sections 422A.01 to 422A.25 this chapter applies becomes 
167.19  absolutely separated from the active service prior to before 
167.20  attaining the minimum retirement age established in section 
167.21  422A.13, the employee is entitled to a refund of the net 
167.22  accumulated amount of deduction from salary, pay, or 
167.23  compensation, made for the purpose of accumulating a fund from 
167.24  which to pay retirement allowances, shall be returned to such 
167.25  employee, with interest at the annual compound rate of six 
167.26  percent.  
167.27     (b) Any contributing employee who separates from a 
167.28  department, board or commission of the city whose employees are 
167.29  covered by a fund organized under sections 422A.01 to 422A.25 
167.30  this chapter, and becomes an employee of a department or board 
167.31  of the same city, whose employees are covered by a retirement 
167.32  fund or relief association by whatever name known, organized 
167.33  under any other law and supported in whole or in part by taxes 
167.34  on the same city, shall have has the option of: 
167.35     (1) retaining their membership in the fund organized under 
167.36  sections 422A.01 to 422A.25 this chapter, regardless of the 
168.1   provisions of any law, rule, bylaw or other action requiring 
168.2   membership in any other retirement fund or relief association 
168.3   however organized.; or 
168.4      (2) transferring to the fund or association covering the 
168.5   employees of the department or board to which they are 
168.6   transferring, providing they are eligible for membership therein.
168.7      (c) Any contributing employee who elects to transfer to 
168.8   another fund or association as herein provided in paragraph (b), 
168.9   clause (2), shall must make such election within one year from 
168.10  the date of separation from the city service covered by this 
168.11  fund.  If the contributing employee elects to transfer to 
168.12  another fund as herein provided, the employee is entitled to a 
168.13  refund of the net accumulated contributions made by such 
168.14  employee to the fund organized under sections 422A.01 to 
168.15  422A.25, shall be returned to the employee this chapter with 
168.16  interest at the annual compound rate of six percent.  
168.17     Sec. 72.  Minnesota Statutes 2004, section 422A.22, 
168.18  subdivision 3, is amended to read: 
168.19     Subd. 3.  [LIMITATION ON ELIGIBILITY.] No employee of the 
168.20  city shall be is eligible to be a member of, or receive benefits 
168.21  from, more than one retirement plan or fund of the city for the 
168.22  same period of service.  
168.23     Sec. 73.  Minnesota Statutes 2004, section 422A.22, 
168.24  subdivision 4, is amended to read: 
168.25     Subd. 4.  [DEATH-WHILE-ACTIVE REFUND.] (a) Upon the death 
168.26  of an active member prior to before the employee's termination 
168.27  of active service, there shall be paid to the beneficiary or 
168.28  beneficiaries designated by the member on a form specified by 
168.29  the executive director and filed with the retirement board, are 
168.30  entitled to receive the net accumulated employee deductions from 
168.31  salary, pay, or compensation, including interest under 
168.32  subdivision 1, paragraph (a), compounded annually to the date of 
168.33  the member's death.  The amount must not include any 
168.34  contributions made by the employee or on the employee's behalf, 
168.35  or any interest or investment earnings on those contributions, 
168.36  which were allocated to the survivor benefit fund under section 
169.1   422A.06, subdivision 6. 
169.2      (b) If the employee fails to make a designation, or if the 
169.3   beneficiary or beneficiaries designated by the employee 
169.4   predeceases the employee, the benefit specified in paragraph (a) 
169.5   must be paid to the deceased employee's estate is entitled to 
169.6   the benefit specified in paragraph (a). 
169.7      (c) A benefit payable under this subdivision is in addition 
169.8   to any applicable survivor benefit under section 422A.23. 
169.9      Sec. 74.  Minnesota Statutes 2004, section 422A.22, 
169.10  subdivision 6, is amended to read: 
169.11     Subd. 6.  [REFUND; MUNICIPAL EMPLOYEES RETIREMENT FUND.] 
169.12  Any A person who has received a refund from the municipal 
169.13  Minneapolis Employees Retirement Fund, and who is a member of a 
169.14  public retirement system included in section 422A.16, 
169.15  subdivision 8, may repay such refund with interest at a compound 
169.16  annual rate of 8.5 percent to the municipal Minneapolis 
169.17  Employees Retirement Fund.  If a refund is repaid to the fund 
169.18  and if more than one refund has been received from the fund, all 
169.19  refunds must be repaid.  Repayment shall must be made as 
169.20  provided in sections 422A.01 to 422A.25 this chapter.  
169.21     Sec. 75.  Minnesota Statutes 2004, section 422A.231, is 
169.22  amended to read: 
169.23     422A.231 [COST ALLOCATION.] 
169.24     (a) Notwithstanding any law to the contrary, all current 
169.25  and future contribution requirements due to this article are 
169.26  payable by the participating contributing employing units other 
169.27  than the state of Minnesota. 
169.28     (b) In each actuarial valuation of the retirement fund, the 
169.29  actuary retained by the Legislative Commission on Pensions and 
169.30  Retirement under section 356.214 shall include an exhibit on the 
169.31  impact of the benefit increases contained in this article on the 
169.32  survivor benefit fund.  The actuary shall calculate the expected 
169.33  change in the present value of the future benefits payable from 
169.34  the survivor benefit fund attributable to this article, using 
169.35  the actuarial method and assumptions applicable to the 
169.36  Minneapolis Employees Retirement Fund, from the prior actuarial 
170.1   valuation and shall compare that result with the actual change 
170.2   in the present value of future benefits payable from the 
170.3   survivor benefit fund attributable to this article from the 
170.4   prior actuarial valuation. 
170.5      (c) The executive director shall assess each participating 
170.6   employer, other than the state of Minnesota, its proportional 
170.7   share of the net increase amount calculated under paragraph 
170.8   (b).  The assessment must be made on the first business day of 
170.9   the following February, plus compound interest at an annual rate 
170.10  of six percent on the amount from the actuarial valuation date 
170.11  to the date of payment. 
170.12     Sec. 76.  Minnesota Statutes 2004, section 422A.24, is 
170.13  amended to read: 
170.14     422A.24 [ALLOWANCES NOT ASSIGNABLE OR SUBJECT TO PROCESS.] 
170.15     No money payable pursuant to this chapter shall be 
170.16  assignable either in law or equity or be subject to execution, 
170.17  levy, attachment, garnishment, or other legal process, except as 
170.18  provided in section 518.58, 518.581, or 518.6111, nor shall any 
170.19  of the proceeds of payments due pursuant to this chapter be 
170.20  subject to the inheritance tax provisions of this state upon 
170.21  transfer to a surviving spouse or minor or dependent child of 
170.22  the decedent or a trust for their benefit. The provisions of 
170.23  section 356.401 apply to the Minneapolis employees retirement 
170.24  plan.  
170.25     Sec. 77.  Minnesota Statutes 2004, section 423B.17, is 
170.26  amended to read: 
170.27     423B.17 [PAYMENTS EXEMPT FROM PROCESS.] 
170.28     A payment made by the association under a provision of 
170.29  sections 423B.01 to 423B.18, as amended, is exempt from legal 
170.30  process except as provided in section 518.58, 518.581, or 
170.31  518.6111.  No person entitled to a payment may assign the same.  
170.32  The association may not recognize an assignment or pay a sum on 
170.33  account of an assignment. The provisions of section 356.401 
170.34  apply to the Minneapolis Police Relief Association.  
170.35     Sec. 78.  Minnesota Statutes 2004, section 423C.09, is 
170.36  amended to read: 
171.1      423C.09 [PAYMENTS EXEMPT FROM PROCESS.] 
171.2      All payments made, or to be made, by the association under 
171.3   this chapter shall be totally exempt from garnishment, 
171.4   execution, or other legal process, except as provided in section 
171.5   518.58, 518.581, or 518.6111.  No person entitled to a payment 
171.6   shall have the right to assign the name, nor shall the 
171.7   association have authority to recognize any assignment or to pay 
171.8   any sum on account thereof.  Any attempt to transfer any right 
171.9   or claim, or any part thereof, shall be void. The provisions of 
171.10  section 356.401 apply to the Minneapolis Firefighters Relief 
171.11  Association.  
171.12     Sec. 79.  Minnesota Statutes 2004, section 490.126, 
171.13  subdivision 5, is amended to read: 
171.14     Subd. 5.  [EXEMPTION FROM PROCESS; NO ASSIGNMENT.] None of 
171.15  the money, annuities, or other benefits provided in this chapter 
171.16  is assignable either in law or equity or is subject to 
171.17  execution, levy, attachment, garnishment, or other legal 
171.18  process, except as provided in section 518.58, 518.581, or 
171.19  518.6111. The provisions of section 356.401 apply to the judges 
171.20  retirement plan.  
171.21     Sec. 80.  [REVISOR'S INSTRUCTION.] 
171.22     In the next edition and subsequent editions of Minnesota 
171.23  Statutes, the revisor of statutes shall replace the reference to 
171.24  "sections 422A.01 to 422A.25" with the reference to "this 
171.25  chapter" wherever the reference appears in Minnesota Statutes, 
171.26  chapter 422A. 
171.27     Sec. 81.  [REPEALER.] 
171.28     (a) Minnesota Statutes 2004, section 352.119, subdivision 
171.29  1, is repealed. 
171.30     (b) Minnesota Statutes 2004, sections 353.34, subdivision 
171.31  3b; 353.36, subdivisions 2, 2a, 2b, and 2c; 353.46, subdivision 
171.32  4; 353.663; 353.74; and 353.75, are repealed. 
171.33     (c) Minnesota Statutes 2004, section 354.59, is repealed. 
171.34     (d) Minnesota Statutes 2004, sections 422A.22, subdivisions 
171.35  2 and 5; and 422A.221, are repealed. 
171.36     (e) Minnesota Statutes 2004, sections 352.15, subdivision 
172.1   1a; 353.15, subdivision 2; and 354.10, subdivision 2, are 
172.2   repealed.  
172.3      Sec. 82.  [EFFECTIVE DATE.] 
172.4      (a) Sections 1 to 73 and 75 to 81 are effective July 1, 
172.5   2005. 
172.6      (b) Section 74 is effective January 1, 2006. 
172.7      (c) Sections 1, 21, 22, 23, 29, 45, 46, 53, 64, 76, 77, 78, 
172.8   79, and 81, paragraph (e), do not apply to any cause of action 
172.9   that is proceeding on the date of enactment or to any cause of 
172.10  action for which the applicable statute of limitations has not 
172.11  expired as of the date of enactment. 
172.12                             ARTICLE 13
172.13                       LOCAL RETIREMENT PLANS
172.14     Section 1.  Minnesota Statutes 2004, section 69.77, 
172.15  subdivision 4, is amended to read: 
172.16     Subd. 4.  [RELIEF ASSOCIATION FINANCIAL REQUIREMENTS; 
172.17  MINIMUM MUNICIPAL OBLIGATION.] (a) The officers of the relief 
172.18  association shall determine the financial requirements of the 
172.19  relief association and minimum obligation of the municipality 
172.20  for the following calendar year in accordance with the 
172.21  requirements of this subdivision.  The financial requirements of 
172.22  the relief association and the minimum obligation of the 
172.23  municipality must be determined on or before the submission date 
172.24  established by the municipality under subdivision 5. 
172.25     (b) The financial requirements of the relief association 
172.26  for the following calendar year must be based on the most recent 
172.27  actuarial valuation or survey of the special fund of the 
172.28  association if more than one fund is maintained by the 
172.29  association, or of the association, if only one fund is 
172.30  maintained, prepared in accordance with sections 356.215, 
172.31  subdivisions 4 to 15, and 356.216, as required under subdivision 
172.32  10.  If an actuarial estimate is prepared by the actuary of the 
172.33  relief association as part of obtaining a modification of the 
172.34  benefit plan of the relief association and the modification is 
172.35  implemented, the actuarial estimate must be used in calculating 
172.36  the subsequent financial requirements of the relief association. 
173.1      (c) If the relief association has an unfunded actuarial 
173.2   accrued liability as reported in the most recent actuarial 
173.3   valuation or survey, the total of the amounts calculated under 
173.4   clauses (1), (2), and (3), constitute the financial requirements 
173.5   of the relief association for the following year.  If the relief 
173.6   association does not have an unfunded actuarial accrued 
173.7   liability as reported in the most recent actuarial valuation or 
173.8   survey, the amount calculated under clauses (1) and (2) 
173.9   constitute the financial requirements of the relief association 
173.10  for the following year.  The financial requirement elements are: 
173.11     (1) the normal level cost requirement for the following 
173.12  year, expressed as a dollar amount, which must be determined by 
173.13  applying the normal level cost of the relief association as 
173.14  reported in the actuarial valuation or survey and expressed as a 
173.15  percentage of covered payroll to the estimated covered payroll 
173.16  of the active membership of the relief association, including 
173.17  any projected change in the active membership, for the following 
173.18  year; 
173.19     (2) for the Bloomington Fire Department Relief Association, 
173.20  the Fairmont Police Relief Association, and the Virginia Fire 
173.21  Department Relief Association, to the dollar amount of normal 
173.22  cost determined under clause (1) must be added an amount equal 
173.23  to the dollar amount of the administrative expenses of the 
173.24  special fund of the association if more than one fund is 
173.25  maintained by the association, or of the association if only one 
173.26  fund is maintained, for the most recent year, multiplied by the 
173.27  factor of 1.035.  The administrative expenses are those 
173.28  authorized under section 69.80.  No amount of administrative 
173.29  expenses under this clause are to be included in the financial 
173.30  requirements of the Minneapolis Firefighters Relief Association 
173.31  or the Minneapolis Police Relief Association; and 
173.32     (3) to the dollar amount of normal cost and expenses 
173.33  determined under clauses (1) and (2) must be added an amount 
173.34  equal to the level annual dollar amount which is sufficient to 
173.35  amortize the unfunded actuarial accrued liability by December 
173.36  31, 2010, for the Bloomington Fire Department Relief 
174.1   Association, the Fairmont Police Relief Association, the 
174.2   Minneapolis Firefighters Relief Association, and the Virginia 
174.3   Fire Department Relief Association, and by December 31, 2020, 
174.4   for the Minneapolis Police Relief Association, as determined 
174.5   from the actuarial valuation or survey of the fund, using an 
174.6   interest assumption set at the applicable rate specified in 
174.7   section 356.215, subdivision 8.  The amortization date specified 
174.8   in this clause applies to all local police or salaried 
174.9   firefighters' relief associations and that date supersedes any 
174.10  amortization date specified in any applicable special law. 
174.11     (d) The minimum obligation of the municipality is an amount 
174.12  equal to the financial requirements of the relief association 
174.13  reduced by the estimated amount of member contributions from 
174.14  covered salary anticipated for the following calendar year and 
174.15  the estimated amounts anticipated for the following calendar 
174.16  year from the applicable state aid program established under 
174.17  sections 69.011 to 69.051 receivable by the relief association 
174.18  after any allocation made under section 69.031, subdivision 5, 
174.19  paragraph (b), clause (2), or 423A.01, subdivision 2, clause 
174.20  (6), from the local police and salaried firefighters' relief 
174.21  association amortization aid program established under section 
174.22  423A.02, subdivision 1, from the supplementary amortization 
174.23  state-aid program established under section 423A.02, subdivision 
174.24  1a, and from the additional amortization state aid under section 
174.25  423A.02, subdivision 1b. 
174.26     Sec. 2.  Minnesota Statutes 2004, section 356.215, 
174.27  subdivision 8, is amended to read: 
174.28     Subd. 8.  [INTEREST AND SALARY ASSUMPTIONS.] (a) The 
174.29  actuarial valuation must use the applicable following 
174.30  preretirement interest assumption and the applicable following 
174.31  postretirement interest assumption: 
174.32                                     preretirement  postretirement 
174.33                                     interest rate  interest rate 
174.34              plan                      assumption     assumption 
174.35       general state employees 
174.36           retirement plan                  8.5%          6.0% 
174.37       correctional state employees 
174.38           retirement plan                  8.5           6.0 
174.39       State Patrol retirement plan         8.5           6.0 
174.40       legislators retirement plan          8.5           6.0 
175.1        elective state officers
175.2            retirement plan                  8.5           6.0 
175.3        judges retirement plan               8.5           6.0 
175.4        general public employees 
175.5            retirement plan                  8.5           6.0 
175.6        public employees police and fire 
175.7            retirement plan                  8.5           6.0 
175.8        local government correctional 
175.9            service retirement plan          8.5           6.0 
175.10       teachers retirement plan             8.5           6.0 
175.11       Minneapolis employees 
175.12           retirement plan                  6.0           5.0 
175.13       Duluth teachers retirement plan      8.5           8.5 
175.14       Minneapolis teachers retirement
175.15           plan                             8.5           8.5 
175.16       St. Paul teachers retirement 
175.17           plan                             8.5           8.5 
175.18       Minneapolis Police Relief 
175.19           Association                      6.0           6.0 
175.20       Fairmont Police Relief 
175.21           Association                      5.0           5.0 
175.22       Minneapolis Fire Department 
175.23           Relief Association               6.0           6.0 
175.24       Virginia Fire Department
175.25           Relief Association               5.0           5.0 
175.26       Bloomington Fire Department
175.27           Relief Association               6.0           6.0
175.28       local monthly benefit volunteer 
175.29           firefighters relief associations 5.0           5.0 
175.30     (b) The actuarial valuation must use the applicable 
175.31  following single rate future salary increase assumption, the 
175.32  applicable following modified single rate future salary increase 
175.33  assumption, or the applicable following graded rate future 
175.34  salary increase assumption: 
175.35     (1) single rate future salary increase assumption 
175.36                                              future salary 
175.37              plan                          increase assumption 
175.38       legislators retirement plan                  5.0% 
175.39       elective state officers retirement 
175.40           plan                                     5.0 
175.41       judges retirement plan                       5.0 
175.42       Minneapolis Police Relief Association        4.0 
175.43       Fairmont Police Relief 
175.44           Association                              3.5 
175.45       Minneapolis Fire Department Relief 
175.46           Association                              4.0 
175.47       Virginia Fire Department
175.48           Relief Association                       3.5 
175.49       Bloomington Fire Department Relief 
175.50           Association                              4.0
175.51     (2) modified single rate future salary increase assumption 
175.52                                              future salary 
175.53                 plan                       increase assumption
175.54           Minneapolis employees        the prior calendar year 
175.55             retirement plan            amount increased first by 
175.56                                        1.0198 percent to prior 
175.57                                        fiscal year date and
175.58                                        then increased by 4.0 
175.59                                        percent annually for
175.60                                        each future year
176.1      (3) select and ultimate future salary increase assumption 
176.2   or graded rate future salary increase assumption 
176.3                                                future salary 
176.4                  plan                       increase assumption 
176.5        general state employees             select calculation and
176.6            retirement plan                      assumption A 
176.7        correctional state employees 
176.8            retirement plan                      assumption H 
176.9        State Patrol retirement plan             assumption H 
176.10       general public employees            select calculation and
176.11           retirement plan                      assumption B 
176.12       public employees police and fire 
176.13           fund retirement plan                 assumption C 
176.14       local government correctional service 
176.15           retirement plan                      assumption H 
176.16       teachers retirement plan                 assumption D 
176.17       Duluth teachers retirement plan          assumption E 
176.18       Minneapolis teachers retirement plan     assumption F 
176.19       St. Paul teachers retirement plan        assumption G 
176.20       
176.21       The select calculation is:
176.22       during the ten-year select period, a designated percent
176.23       is multiplied by the result of ten minus T, where T is 
176.24       the number of completed years of service, and is added
176.25       to the applicable future salary increase assumption.  The
176.26       designated percent is 0.2 percent for the correctional state
176.27       employees retirement plan, the State Patrol retirement
176.28       plan, the public employees police and fire plan, and the
176.29       local government correctional service plan; 0.3 percent
176.30       for the general state employees retirement plan, the
176.31       general public employees retirement plan, the teachers
176.32       retirement plan, the Duluth Teachers Retirement Fund
176.33       Association, and the St. Paul Teachers Retirement Fund
176.34       Association; and 0.4 percent for the Minneapolis Teachers
176.35       Retirement Fund Association.
176.36       
176.37            The ultimate future salary increase assumption is:
176.38       
176.39       age  A     B      C     D     E     F     G      H 
176.40       16  6.95% 6.95% 11.50% 8.20% 8.00% 6.50% 6.90% 7.7500
176.41       17  6.90  6.90  11.50  8.15  8.00  6.50  6.90  7.7500
176.42       18  6.85  6.85  11.50  8.10  8.00  6.50  6.90  7.7500
176.43       19  6.80  6.80  11.50  8.05  8.00  6.50  6.90  7.7500
176.44       20  6.75  6.40  11.50  6.00  6.90  6.50  6.90  7.7500
176.45       21  6.75  6.40  11.50  6.00  6.90  6.50  6.90  7.1454
176.46       22  6.75  6.40  11.00  6.00  6.90  6.50  6.90  7.0725
176.47       23  6.75  6.40  10.50  6.00  6.85  6.50  6.85  7.0544
176.48       24  6.75  6.40  10.00  6.00  6.80  6.50  6.80  7.0363
176.49       25  6.75  6.40   9.50  6.00  6.75  6.50  6.75  7.0000 
176.50       26  6.75  6.36   9.20  6.00  6.70  6.50  6.70  7.0000
176.51       27  6.75  6.32   8.90  6.00  6.65  6.50  6.65  7.0000 
176.52       28  6.75  6.28   8.60  6.00  6.60  6.50  6.60  7.0000
176.53       29  6.75  6.24   8.30  6.00  6.55  6.50  6.55  7.0000
176.54       30  6.75  6.20   8.00  6.00  6.50  6.50  6.50  7.0000
176.55       31  6.75  6.16   7.80  6.00  6.45  6.50  6.45  7.0000
176.56       32  6.75  6.12   7.60  6.00  6.40  6.50  6.40  7.0000
176.57       33  6.75  6.08   7.40  6.00  6.35  6.50  6.35  7.0000
176.58       34  6.75  6.04   7.20  6.00  6.30  6.50  6.30  7.0000
176.59       35  6.75  6.00   7.00  6.00  6.25  6.50  6.25  7.0000
176.60       36  6.75  5.96   6.80  6.00  6.20  6.50  6.20  6.9019
176.61       37  6.75  5.92   6.60  6.00  6.15  6.50  6.15  6.8074
176.62       38  6.75  5.88   6.40  5.90  6.10  6.50  6.10  6.7125
176.63       39  6.75  5.84   6.20  5.80  6.05  6.50  6.05  6.6054
176.64       40  6.75  5.80   6.00  5.70  6.00  6.50  6.00  6.5000
176.65       41  6.75  5.76   5.90  5.60  5.90  6.50  5.95  6.3540
176.66       42  6.75  5.72   5.80  5.50  5.80  6.50  5.90  6.2087
176.67       43  6.65  5.68   5.70  5.40  5.70  6.50  5.85  6.0622
176.68       44  6.55  5.64   5.60  5.30  5.60  6.50  5.80  5.9048
177.1        45  6.45  5.60   5.50  5.20  5.50  6.50  5.75  5.7500
177.2        46  6.35  5.56   5.45  5.10  5.40  6.40  5.70  5.6940
177.3        47  6.25  5.52   5.40  5.00  5.30  6.30  5.65  5.6375
177.4        48  6.15  5.48   5.35  5.00  5.20  6.20  5.60  5.5822
177.5        49  6.05  5.44   5.30  5.00  5.10  6.10  5.55  5.5404
177.6        50  5.95  5.40   5.25  5.00  5.00  6.00  5.50  5.5000
177.7        51  5.85  5.36   5.25  5.00  5.00  5.90  5.45  5.4384
177.8        52  5.75  5.32   5.25  5.00  5.00  5.80  5.40  5.3776
177.9        53  5.65  5.28   5.25  5.00  5.00  5.70  5.35  5.3167
177.10       54  5.55  5.24   5.25  5.00  5.00  5.60  5.30  5.2826
177.11       55  5.45  5.20   5.25  5.00  5.00  5.50  5.25  5.2500 
177.12       56  5.35  5.16   5.25  5.00  5.00  5.40  5.20  5.2500
177.13       57  5.25  5.12   5.25  5.00  5.00  5.30  5.15  5.2500
177.14       58  5.25  5.08   5.25  5.10  5.00  5.20  5.10  5.2500
177.15       59  5.25  5.04   5.25  5.20  5.00  5.10  5.05  5.2500
177.16       60  5.25  5.00   5.25  5.30  5.00  5.00  5.00  5.2500
177.17       61  5.25  5.00   5.25  5.40  5.00  5.00  5.00  5.2500
177.18       62  5.25  5.00   5.25  5.50  5.00  5.00  5.00  5.2500
177.19       63  5.25  5.00   5.25  5.60  5.00  5.00  5.00  5.2500
177.20       64  5.25  5.00   5.25  5.70  5.00  5.00  5.00  5.2500
177.21       65  5.25  5.00   5.25  5.70  5.00  5.00  5.00  5.2500
177.22       66  5.25  5.00   5.25  5.70  5.00  5.00  5.00  5.2500
177.23       67  5.25  5.00   5.25  5.70  5.00  5.00  5.00  5.2500
177.24       68  5.25  5.00   5.25  5.70  5.00  5.00  5.00  5.2500
177.25       69  5.25  5.00   5.25  5.70  5.00  5.00  5.00  5.2500
177.26       70  5.25  5.00   5.25  5.70  5.00  5.00  5.00  5.2500
177.27       71  5.25  5.00         5.70
177.28     (c) The actuarial valuation must use the applicable 
177.29  following payroll growth assumption for calculating the 
177.30  amortization requirement for the unfunded actuarial accrued 
177.31  liability where the amortization retirement is calculated as a 
177.32  level percentage of an increasing payroll: 
177.33                                                   payroll growth
177.34                    plan                             assumption 
177.35       general state employees retirement plan          5.00% 
177.36       correctional state employees retirement plan     5.00 
177.37       State Patrol retirement plan                     5.00 
177.38       legislators retirement plan                      5.00 
177.39       elective state officers retirement plan          5.00 
177.40       judges retirement plan                           5.00 
177.41       general public employees retirement plan         6.00 
177.42       public employees police and fire 
177.43           retirement plan                              6.00 
177.44       local government correctional service 
177.45           retirement plan                              6.00 
177.46       teachers retirement plan                         5.00 
177.47       Duluth teachers retirement plan                  5.00 
177.48       Minneapolis teachers retirement plan             5.00 
177.49       St. Paul teachers retirement plan                5.00 
177.50     Sec. 3.  Minnesota Statutes 2004, section 356.216, is 
177.51  amended to read: 
177.52     356.216 [CONTENTS OF ACTUARIAL VALUATIONS FOR LOCAL POLICE 
177.53  AND FIRE FUNDS.] 
177.54     (a) The provisions of section 356.215 that govern the 
177.55  contents of actuarial valuations must apply to any local police 
177.56  or fire pension fund or relief association required to make an 
177.57  actuarial report under this section, except as follows: 
178.1      (1) in calculating normal cost and other requirements, if 
178.2   required to be expressed as a level percentage of covered 
178.3   payroll, the salaries used in computing covered payroll must be 
178.4   the maximum rate of salary on which retirement and survivorship 
178.5   credits and amounts of benefits are determined and from which 
178.6   any member contributions are calculated and deducted; 
178.7      (2) in lieu of the amortization date specified in section 
178.8   356.215, subdivision 11, the appropriate amortization target 
178.9   date specified in section 69.77, subdivision 4, or 69.773, 
178.10  subdivision 4, clause (c), must be used in calculating any 
178.11  required amortization contribution, except that if the actuarial 
178.12  report for the Bloomington Fire Department Relief Association 
178.13  indicates an unfunded actuarial accrued liability, the unfunded 
178.14  obligation is to be amortized on a level dollar basis by 
178.15  December 31 of the year occurring 20 years later, and if 
178.16  subsequent actuarial valuations for the Bloomington Fire 
178.17  Department Relief Association determine a net actuarial 
178.18  experience loss incurred during the year which ended as of the 
178.19  day before the most recent actuarial valuation date, any 
178.20  unfunded liability due to that loss is to be amortized on a 
178.21  level dollar basis by December 31 of the year occurring 20 years 
178.22  later; 
178.23     (3) in addition to the tabulation of active members and 
178.24  annuitants provided for in section 356.215, subdivision 13, the 
178.25  member contributions for active members for the calendar year 
178.26  and the prospective annual retirement annuities under the 
178.27  benefit plan for active members must be reported; 
178.28     (4) actuarial valuations required under section 69.773, 
178.29  subdivision 2, must be made at least every four years and 
178.30  actuarial valuations required under section 69.77 shall be made 
178.31  annually; 
178.32     (5) the actuarial balance sheet showing accrued assets 
178.33  valued at market value if the actuarial valuation is required to 
178.34  be prepared at least every four years or valued as current 
178.35  assets under section 356.215, subdivision 1, clause (6), or 
178.36  paragraph (b), whichever applies, if the actuarial valuation is 
179.1   required to be prepared annually, actuarial accrued liabilities, 
179.2   and the unfunded actuarial accrued liability must include the 
179.3   following required reserves: 
179.4            (i) For active members 
179.5         1.  Retirement benefits 
179.6         2.  Disability benefits 
179.7         3.  Refund liability due to death or withdrawal 
179.8         4.  Survivors' benefits 
179.9            (ii) For deferred annuitants' benefits 
179.10           (iii) For former members without vested rights 
179.11           (iv) For annuitants 
179.12        1.  Retirement annuities 
179.13        2.  Disability annuities 
179.14        3.  Surviving spouses' annuities 
179.15        4.  Surviving children's annuities 
179.16     In addition to those required reserves, separate items must 
179.17  be shown for additional benefits, if any, which may not be 
179.18  appropriately included in the reserves listed above; and 
179.19     (6) actuarial valuations are due by the first day of the 
179.20  seventh month after the end of the fiscal year which the 
179.21  actuarial valuation covers. 
179.22     (b) For the Minneapolis Firefighters Relief Association or 
179.23  the Minneapolis Police Relief Association, the following 
179.24  provisions additionally apply: 
179.25     (1) in calculating the actuarial balance sheet, unfunded 
179.26  actuarial accrued liability, and amortization contribution of 
179.27  the relief association, "current assets" means the value of all 
179.28  assets at cost, including realized capital gains and losses, 
179.29  plus or minus, whichever applies, the average value of total 
179.30  unrealized capital gains or losses for the most recent 
179.31  three-year period ending with the end of the plan year 
179.32  immediately preceding the actuarial valuation report 
179.33  transmission date; and 
179.34     (2) in calculating the applicable portions of the actuarial 
179.35  valuation, an annual preretirement interest assumption of six 
179.36  percent, an annual postretirement interest assumption of six 
180.1   percent, and an annual salary increase assumption of four 
180.2   percent must be used. 
180.3      Sec. 4.  Minnesota Statutes 2004, section 356.216, is 
180.4   amended to read: 
180.5      356.216 [CONTENTS OF ACTUARIAL VALUATIONS FOR LOCAL POLICE 
180.6   AND FIRE FUNDS.] 
180.7      (a) The provisions of section 356.215 that govern the 
180.8   contents of actuarial valuations must apply to any local police 
180.9   or fire pension fund or relief association required to make an 
180.10  actuarial report under this section, except as follows: 
180.11     (1) in calculating normal cost and other requirements, if 
180.12  required to be expressed as a level percentage of covered 
180.13  payroll, the salaries used in computing covered payroll must be 
180.14  the maximum rate of salary on which retirement and survivorship 
180.15  credits and amounts of benefits are determined and from which 
180.16  any member contributions are calculated and deducted; 
180.17     (2) in lieu of the amortization date specified in section 
180.18  356.215, subdivision 11, the appropriate amortization target 
180.19  date specified in section 69.77, subdivision 4, or 69.773, 
180.20  subdivision 4, clause (c), must be used in calculating any 
180.21  required amortization contribution except that the amortization 
180.22  date for the Minneapolis Police Relief Association is December 
180.23  31, 2020; 
180.24     (3) in addition to the tabulation of active members and 
180.25  annuitants provided for in section 356.215, subdivision 13, the 
180.26  member contributions for active members for the calendar year 
180.27  and the prospective annual retirement annuities under the 
180.28  benefit plan for active members must be reported; 
180.29     (4) actuarial valuations required under section 69.773, 
180.30  subdivision 2, must be made at least every four years and 
180.31  actuarial valuations required under section 69.77 shall be made 
180.32  annually; 
180.33     (5) the actuarial balance sheet showing accrued assets 
180.34  valued at market value if the actuarial valuation is required to 
180.35  be prepared at least every four years or valued as current 
180.36  assets under section 356.215, subdivision 1, clause (6), or 
181.1   paragraph (b), whichever applies, if the actuarial valuation is 
181.2   required to be prepared annually, actuarial accrued liabilities, 
181.3   and the unfunded actuarial accrued liability must include the 
181.4   following required reserves: 
181.5            (i) For active members 
181.6         1.  Retirement benefits 
181.7         2.  Disability benefits 
181.8         3.  Refund liability due to death or withdrawal 
181.9         4.  Survivors' benefits 
181.10           (ii) For deferred annuitants' benefits 
181.11           (iii) For former members without vested rights 
181.12           (iv) For annuitants 
181.13        1.  Retirement annuities 
181.14        2.  Disability annuities 
181.15        3.  Surviving spouses' annuities 
181.16        4.  Surviving children's annuities 
181.17     In addition to those required reserves, separate items must 
181.18  be shown for additional benefits, if any, which may not be 
181.19  appropriately included in the reserves listed above; and 
181.20     (6) actuarial valuations are due by the first day of the 
181.21  seventh month after the end of the fiscal year which the 
181.22  actuarial valuation covers. 
181.23     (b) For the Minneapolis Firefighters Relief Association or 
181.24  the Minneapolis Police Relief Association, the following 
181.25  provisions additionally apply: 
181.26     (1) in calculating the actuarial balance sheet, unfunded 
181.27  actuarial accrued liability, and amortization contribution of 
181.28  the relief association, "current assets" means the value of all 
181.29  assets at cost, including realized capital gains and losses, 
181.30  plus or minus, whichever applies, the average value of total 
181.31  unrealized capital gains or losses for the most recent 
181.32  three-year period ending with the end of the plan year 
181.33  immediately preceding the actuarial valuation report 
181.34  transmission date; and 
181.35     (2) in calculating the applicable portions of the actuarial 
181.36  valuation, an annual preretirement interest assumption of six 
182.1   percent, an annual postretirement interest assumption of six 
182.2   percent, and an annual salary increase assumption of four 
182.3   percent must be used. 
182.4      Sec. 5.  Minnesota Statutes 2004, section 383B.46, 
182.5   subdivision 2, is amended to read: 
182.6      Subd. 2.  [ESTABLISHMENT OF ACCOUNT; CONTRIBUTIONS.] The 
182.7   county of Hennepin shall deduct from the salary of every person 
182.8   who is eligible for coverage and who elected to retain or obtain 
182.9   coverage by the Hennepin County supplemental retirement program 
182.10  a sum equal to one percent of the total salary of the person.  
182.11  Any classified or unclassified employee who is employed in 
182.12  subsidized on-the-job training, work experience or public 
182.13  service employment as an enrollee under the federal 
182.14  Comprehensive Employment and Training Act shall not be included 
182.15  in the supplemental retirement account from and after March 30, 
182.16  1978 unless the employee has as of the later of March 30, 1978 
182.17  or the date of employment sufficient service credit in the 
182.18  public employees retirement fund or the Minneapolis municipal 
182.19  employees retirement fund, whichever is applicable, to meet the 
182.20  minimum vesting requirements for a deferred retirement annuity, 
182.21  or the county agrees in writing to make the required employer 
182.22  contributions on account of the individual from revenue sources 
182.23  other than funds provided under the federal Comprehensive 
182.24  Employment and Training Act, or the employee agrees in writing 
182.25  to make the required employer contribution in addition to the 
182.26  employee contribution.  The deduction shall be made in the same 
182.27  manner as other retirement deductions are made from the salary 
182.28  of the person.  An amount equal to the amounts deducted during 
182.29  each payroll period shall be contributed by the county of 
182.30  Hennepin.  The total amount deducted and contributed shall be 
182.31  deposited to the credit of the supplemental retirement account 
182.32  in the treasury of the county of Hennepin a separate account 
182.33  administered by the Minnesota State Retirement System on behalf 
182.34  of Hennepin County.  The Hennepin County supplemental retirement 
182.35  account is hereby established as an account separate and 
182.36  distinct from other funds, accounts, or assets of the county of 
183.1   Hennepin. 
183.2      Sec. 6.  Minnesota Statutes 2004, section 383B.47, is 
183.3   amended to read: 
183.4      383B.47 [PARTICIPATION IN MINNESOTA SUPPLEMENTAL INVESTMENT 
183.5   FUND.] 
183.6      With the moneys deposited to the credit of the supplemental 
183.7   retirement account in the treasury of the county of Hennepin, 
183.8   the county of Hennepin, the Minnesota State Retirement System 
183.9   shall purchase shares on behalf of Hennepin County in the 
183.10  accounts of the Minnesota supplemental investment fund as 
183.11  provided in section 383B.48. 
183.12     Sec. 7.  Minnesota Statutes 2004, section 383B.48, is 
183.13  amended to read: 
183.14     383B.48 [BUYING STATE SUPPLEMENTAL INVESTMENT FUND SHARES.] 
183.15     At the time a person becomes eligible for coverage and 
183.16  elects to obtain coverage by the Hennepin County supplemental 
183.17  retirement program and before November 1 of each subsequent 
183.18  year, A participant in the Hennepin County supplemental 
183.19  retirement program shall indicate in writing on a form provided 
183.20  by the county of Hennepin the account of the Minnesota 
183.21  supplemental investment fund in which the participant wishes 
183.22  salary deductions and county matching contributions attributable 
183.23  to salary deductions to be invested for the subsequent 12-month 
183.24  period such time as allowed by the Minnesota State Retirement 
183.25  System.  For that 12-month period, The county of Hennepin 
183.26  Minnesota State Retirement System shall purchase with the salary 
183.27  deductions and county matching funds attributable to the salary 
183.28  deductions shares in the appropriate account of the Minnesota 
183.29  supplemental investment fund in accordance with the indicated 
183.30  preferences of the participant.  However, the county of Hennepin 
183.31  has the authority to determine which accounts of the Minnesota 
183.32  supplemental investment fund will be available for participant 
183.33  investment.  The shares purchased must stand in the name of the 
183.34  county of Hennepin.  A record must be kept by the county of 
183.35  Hennepin Minnesota State Retirement System indicating the number 
183.36  of shares in each account of the Minnesota supplemental 
184.1   investment fund purchased with the salary deductions and county 
184.2   matching funds attributable to the salary deductions of each 
184.3   participant.  The record must be known as the "participant's 
184.4   share account record."  The participant's share account record 
184.5   must show, in addition to the number of shares in the account, 
184.6   any cash balance of salary deductions or county matching funds 
184.7   attributable to those deductions which stand uninvested in 
184.8   shares.  At the option of the county of Hennepin, and subject to 
184.9   any terms and conditions established and communicated in writing 
184.10  by the county to a participant, the participant may designate no 
184.11  more often than once each calendar quarter month that prior 
184.12  salary deductions and county matching contributions attributable 
184.13  to the salary deductions, together with any interest earned, be 
184.14  reinvested in another account of the Minnesota supplemental 
184.15  investment fund made available by the county of Hennepin. 
184.16     Sec. 8.  Minnesota Statutes 2004, section 383B.49, is 
184.17  amended to read: 
184.18     383B.49 [SUPPLEMENTAL RETIREMENT BENEFITS; REDEMPTION OF 
184.19  SHARES.] 
184.20     When requested to do so, in writing, on forms provided by 
184.21  the county Minnesota State Retirement System, by a participant, 
184.22  surviving spouse, a guardian of a surviving child or a personal 
184.23  representative, whichever is applicable, the county of Hennepin 
184.24  Minnesota State Retirement System shall on behalf of Hennepin 
184.25  County redeem shares in the accounts of the Minnesota 
184.26  supplemental investment fund standing in a participant's share 
184.27  account record under the following circumstances and in 
184.28  accordance with the laws and regulations governing the Minnesota 
184.29  supplemental investment fund: 
184.30     (1) A participant who is no longer employed by the county 
184.31  of Hennepin is entitled to receive the cash realized on the 
184.32  redemption of the shares to the credit of the participant's 
184.33  share account record of the person.  The participant may request 
184.34  the redemption of all or a portion of the shares in the 
184.35  participant's share account record of the person, but may not 
184.36  request more than one redemption in any one calendar year.  If 
185.1   only a portion of the shares in the participant's share account 
185.2   record is requested to be redeemed the person may request to 
185.3   redeem not less than 20 percent of the shares in any one 
185.4   calendar year and the redemption must be completed in no more 
185.5   than five years.  The person may select annual redemption in a 
185.6   single lump sum or in monthly payments.  An election is 
185.7   irrevocable except that a participant may request an amendment 
185.8   of the election to redeem all of the person's remaining shares.  
185.9   All requests under this paragraph are subject to application to 
185.10  and approval of the Hennepin County administrator, in the sole 
185.11  discretion of the administrator Minnesota State Retirement 
185.12  System upon verification by Hennepin County through the county 
185.13  administrator of the recipient's eligibility to redeem funds.  
185.14     (2) In the event of the death of a participant leaving a 
185.15  surviving spouse, the surviving spouse is entitled to receive 
185.16  the cash realized on the redemption of all or a portion of the 
185.17  shares in the participant's share account record of the deceased 
185.18  spouse, but in no event may the spouse request more than one 
185.19  redemption in each calendar year.  If only a portion of the 
185.20  shares in the participant's share account record is requested to 
185.21  be redeemed, the surviving spouse may request the redemption of 
185.22  not less than 20 percent of the shares in any one calendar year. 
185.23  The surviving spouse may elect annual redemption in a single 
185.24  lump sum payment or in monthly payments.  Redemption must be 
185.25  completed in no more than five years.  An election is 
185.26  irrevocable except that the surviving spouse may request an 
185.27  amendment of the election to redeem all of the participant's 
185.28  remaining shares.  All requests under this paragraph are subject 
185.29  to application to and approval of the Hennepin County 
185.30  administrator, in the sole discretion of the 
185.31  administrator Minnesota State Retirement System upon 
185.32  verification by Hennepin County through the county administrator 
185.33  of the recipient's eligibility to redeem funds.  Upon the death 
185.34  of the surviving spouse, any shares remaining in the 
185.35  participant's share account record must be redeemed on behalf of 
185.36  Hennepin County by the county of Hennepin Minnesota State 
186.1   Retirement System and the cash realized from the redemption 
186.2   distributed to the estate of the surviving spouse. 
186.3      (3) In the event of the death of a participant leaving no 
186.4   surviving spouse, but leaving a minor surviving child or minor 
186.5   surviving children, the guardianship estate of the minor child 
186.6   is, or the guardianship estates of the minor children are, 
186.7   entitled to receive the cash realized on the redemption of all 
186.8   shares to the credit of the participant's share account record 
186.9   of the deceased participant.  In the event of minor surviving 
186.10  children, the cash realized must be paid in equal shares to the 
186.11  guardianship estates of the minor surviving children. 
186.12     (4) In the event of the death of a participant leaving no 
186.13  surviving spouse and no minor surviving children, the estate of 
186.14  the deceased participant is entitled to receive the cash 
186.15  realized on the redemption of all shares to the credit of the 
186.16  participant's share account record of the deceased participant. 
186.17     Sec. 9.  [383B.491] [MINNESOTA STATE RETIREMENT SYSTEM 
186.18  BILLING AUTHORITY.] 
186.19     The Minnesota State Retirement System executive director is 
186.20  authorized to enter into an interagency agreement with Hennepin 
186.21  County under which the Minnesota State Retirement System would 
186.22  directly bill the county for the cost of the Minnesota State 
186.23  Retirement System's administration of the Hennepin County 
186.24  Supplemental Retirement Plan.  
186.25     Sec. 10.  Minnesota Statutes 2004, section 423B.01, 
186.26  subdivision 12, is amended to read: 
186.27     Subd. 12.  [EXCESS INVESTMENT INCOME.] "Excess investment 
186.28  income" means the amount, if any, by which the average time 
186.29  weighted total rate of return earned by the fund in the most 
186.30  recent prior five two fiscal years has exceeded the actual 
186.31  average percentage increase in the current monthly salary of a 
186.32  first grade patrol officer in the most recent prior five two 
186.33  fiscal years plus two percent, and must be expressed as a dollar 
186.34  amount.  The amount may not exceed one percent of the total 
186.35  assets of the fund, except when the actuarial value of assets of 
186.36  the fund according to the most recent annual actuarial valuation 
187.1   prepared in accordance with sections 356.215 and 356.216 is 
187.2   greater than 102 percent of its actuarial accrued liabilities, 
187.3   in which case the amount must not exceed 1-1/2 percent of the 
187.4   total assets of the fund, and does not exist unless the yearly 
187.5   average percentage increase of the time weighted total rate of 
187.6   return of the fund for the previous five two years exceeds by 
187.7   two percent the yearly average percentage increase in monthly 
187.8   salary of a first grade patrol officer during the previous five 
187.9   two calendar years. 
187.10     Sec. 11.  Minnesota Statutes 2004, section 423B.09, 
187.11  subdivision 1, is amended to read: 
187.12     Subdivision 1.  [MINNEAPOLIS POLICE; PERSONS ENTITLED TO 
187.13  RECEIVE PENSIONS.] The association shall grant pensions payable 
187.14  from the police pension fund in monthly installments to persons 
187.15  entitled to pensions in the manner and for the following 
187.16  purposes. 
187.17     (a) When the actuarial value of assets of the fund 
187.18  according to the most recent annual actuarial valuation 
187.19  performed in accordance with sections 356.215 and 356.216 is 
187.20  less than 90 percent of the actuarial accrued liabilities, an 
187.21  active member or a deferred pensioner who has performed duty as 
187.22  a member of the police department of the city for five years or 
187.23  more, upon written application after retiring from duty and 
187.24  reaching at least age 50, is entitled to be paid monthly for 
187.25  life a service pension equal to eight units.  For full years of 
187.26  service beyond five years, the service pension increases by 1.6 
187.27  units for each full year, to a maximum of 40 units.  When the 
187.28  actuarial value of assets of the fund according to the most 
187.29  recent annual actuarial valuation prepared in accordance with 
187.30  sections 356.215 and 356.216 is greater than 90 percent of 
187.31  actuarial accrued liabilities, Active members, deferred members, 
187.32  and service pensioners are entitled to a service pension 
187.33  according to the following schedule: 
187.34                 5 years           8.0 units
187.35                 6 years           9.6 units
187.36                 7 years          11.2 units
188.1                  8 years          12.8 units
188.2                  9 years          14.4 units
188.3                 10 years          16.0 units
188.4                 11 years          17.6 units
188.5                 12 years          19.2 units
188.6                 13 years          20.8 units
188.7                 14 years          22.4 units
188.8                 15 years          24.0 units
188.9                 16 years          25.6 units
188.10                17 years          27.2 units
188.11                18 years          28.8 units
188.12                19 years          30.4 units
188.13                20 years          34.0 35.0 units
188.14                21 years          35.6 36.6 units
188.15                22 years          37.2 38.2 units
188.16                23 years          38.8 39.8 units
188.17                24 years          40.4 41.4 units
188.18                25 years          42.0 43.0 units
188.19     Fractional years of service may not be used in computing 
188.20  pensions. 
188.21     (b) An active member who after five years' service but less 
188.22  than 20 years' service with the police department of the city, 
188.23  becomes superannuated so as to be permanently unable to perform 
188.24  the person's assigned duties, is entitled to be paid monthly for 
188.25  life a superannuation pension equal to four units for five years 
188.26  of service and an additional two units for each full year of 
188.27  service over five years and less than 20 years. 
188.28     (c) An active member who is not eligible for a service 
188.29  pension and who, while a member of the police department of the 
188.30  city, becomes diseased or sustains an injury while in the 
188.31  service that permanently unfits the member for the performance 
188.32  of police duties is entitled to be paid monthly for life a 
188.33  pension equal to 34 units while so disabled. 
188.34     Sec. 12.  Minnesota Statutes 2004, section 423B.09, 
188.35  subdivision 1, is amended to read: 
188.36     Subdivision 1.  [MINNEAPOLIS POLICE; PERSONS ENTITLED TO 
189.1   RECEIVE PENSIONS.] The association shall grant pensions payable 
189.2   from the police pension fund in monthly installments to persons 
189.3   entitled to pensions in the manner and for the following 
189.4   purposes. 
189.5      (a) When the actuarial value of assets of the fund 
189.6   according to the most recent annual actuarial valuation 
189.7   performed in accordance with sections 356.215 and 356.216 is 
189.8   less than 90 percent of the actuarial accrued liabilities, An 
189.9   active member or a deferred pensioner who has performed duty as 
189.10  a member of the police department of the city for five years or 
189.11  more, upon written application after retiring from duty and 
189.12  reaching at least age 50, is entitled to be paid monthly for 
189.13  life a service pension equal to eight units.  For full years of 
189.14  service beyond five years, the service pension increases by 1.6 
189.15  units for each full year, to a maximum of 40 units.  When the 
189.16  actuarial value of assets of the fund according to the most 
189.17  recent annual actuarial valuation prepared in accordance with 
189.18  sections 356.215 and 356.216 is greater than 90 percent of 
189.19  actuarial accrued liabilities,.  Active members, deferred 
189.20  members, and service pensioners are entitled to a service 
189.21  pension according to the following schedule: 
189.22                 5 years           8.0 units
189.23                 6 years           9.6 units
189.24                 7 years          11.2 units
189.25                 8 years          12.8 units
189.26                 9 years          14.4 units
189.27                10 years          16.0 units
189.28                11 years          17.6 units
189.29                12 years          19.2 units
189.30                13 years          20.8 units
189.31                14 years          22.4 units
189.32                15 years          24.0 units
189.33                16 years          25.6 units
189.34                17 years          27.2 units
189.35                18 years          28.8 units
189.36                19 years          30.4 units
190.1                 20 years          34.0 units
190.2                 21 years          35.6 units
190.3                 22 years          37.2 units
190.4                 23 years          38.8 units
190.5                 24 years          40.4 units
190.6                 25 years          42.0 units
190.7      Fractional years of service may not be used in computing 
190.8   pensions. 
190.9      (b) An active member who after five years' service but less 
190.10  than 20 years' service with the police department of the city, 
190.11  becomes superannuated so as to be permanently unable to perform 
190.12  the person's assigned duties, is entitled to be paid monthly for 
190.13  life a superannuation pension equal to four units for five years 
190.14  of service and an additional two units for each full year of 
190.15  service over five years and less than 20 years. 
190.16     (c) An active member who is not eligible for a service 
190.17  pension and who, while a member of the police department of the 
190.18  city, becomes diseased or sustains an injury while in the 
190.19  service that permanently unfits the member for the performance 
190.20  of police duties is entitled to be paid monthly for life a 
190.21  pension equal to 34 units while so disabled.  
190.22     Sec. 13.  Minnesota Statutes 2004, section 423B.09, is 
190.23  amended by adding a subdivision to read: 
190.24     Subd. 7.  [ADDITIONAL UNIT.] The additional unit provided 
190.25  to members by subdivision 1 must also be provided to members who 
190.26  selected a joint annuity option under subdivision 6 and must be 
190.27  in an amount that is actuarially equivalent to the service 
190.28  pension and the automatic survivor coverage for that additional 
190.29  unit. 
190.30     Sec. 14.  Minnesota Statutes 2004, section 423B.10, 
190.31  subdivision 1, is amended to read: 
190.32     Subdivision 1.  [ENTITLEMENT; BENEFIT AMOUNT.] (a) The 
190.33  surviving spouse of a deceased service pensioner, disability 
190.34  pensioner, deferred pensioner, superannuation pensioner, or 
190.35  active member, who was the legally married spouse of the 
190.36  decedent, residing with the decedent, and who was married while 
191.1   or before the time the decedent was on the payroll of the police 
191.2   department, and who, if the deceased member was a service or 
191.3   deferred pensioner, was legally married to the member for a 
191.4   period of at least one year before retirement from the police 
191.5   department, is entitled to a surviving spouse benefit.  The 
191.6   surviving spouse benefit is equal to 22 23 units per month if 
191.7   the person is the surviving spouse of a deceased active member 
191.8   or disabilitant.  The surviving spouse benefit is equal to six 
191.9   units per month, plus an additional one unit for each year of 
191.10  service to the credit of the decedent in excess of five years, 
191.11  to a maximum of 22 23 units per month, if the person is the 
191.12  surviving spouse of a deceased service pensioner, deferred 
191.13  pensioner, or superannuation pensioner.  The surviving spouse 
191.14  benefit is payable for the life of the surviving spouse. 
191.15     (b) A surviving child of a deceased service pensioner, 
191.16  disability pensioner, deferred pensioner, superannuation 
191.17  pensioner, or active member, who was living while the decedent 
191.18  was an active member of the police department or was born within 
191.19  nine months after the decedent terminated active service in the 
191.20  police department, is entitled to a surviving child benefit.  
191.21  The surviving child benefit is equal to eight units per month if 
191.22  the person is the surviving child of a deceased active member or 
191.23  disabilitant.  The surviving child benefit is equal to two units 
191.24  per month, plus an additional four-tenths of one unit per month 
191.25  for each year of service to the credit of the decedent in excess 
191.26  of five years, to a maximum of eight units, if the person is the 
191.27  surviving child of a deceased service pensioner, deferred 
191.28  pensioner, or superannuation pensioner.  The surviving child 
191.29  benefit is payable until the person attains age 18, or, if in 
191.30  full-time attendance during the normal school year, in a school 
191.31  approved by the board of directors, until the person receives a 
191.32  bachelor's degree or attains the age of 22 years, whichever 
191.33  occurs first.  In the event of the death of both parents leaving 
191.34  a surviving child or children entitled to a surviving child 
191.35  benefit as determined in this paragraph, the surviving child is, 
191.36  or the surviving children are, entitled to a surviving child 
192.1   benefit in such sums as determined by the board of directors to 
192.2   be necessary for the care and education of such surviving child 
192.3   or children, but not to exceed the family maximum benefit per 
192.4   month, to the children of any one family.  
192.5      (c) The surviving spouse and surviving child benefits are 
192.6   subject to a family maximum benefit.  The family maximum benefit 
192.7   is 41 units per month. 
192.8      (d) A surviving spouse who is otherwise not qualified may 
192.9   receive a benefit if the surviving spouse was married to the 
192.10  decedent for a period of five years and was residing with the 
192.11  decedent at the time of death.  The surviving spouse benefit is 
192.12  the same as that provided in paragraph (a), except that if the 
192.13  surviving spouse is younger than the decedent, the surviving 
192.14  spouse benefit must be actuarially equivalent to a surviving 
192.15  spouse benefit that would have been paid to the member's spouse 
192.16  had the member been married to a person of the same age or a 
192.17  greater age than the member's age before retirement. 
192.18     Sec. 15.  Minnesota Statutes 2004, section 423B.15, 
192.19  subdivision 3, is amended to read: 
192.20     Subd. 3.  [AMOUNT OF ANNUAL POSTRETIREMENT PAYMENT.] The 
192.21  amount determined under subdivision 2 must be applied in 
192.22  accordance with this subdivision.  When the actuarial value of 
192.23  assets of the fund according to the most recent annual actuarial 
192.24  valuation prepared in accordance with sections 356.215 and 
192.25  356.216 is less than 102 percent of its total actuarial 
192.26  liabilities, the relief association shall apply the first 
192.27  one-half of excess investment income to the payment of an annual 
192.28  postretirement payment as specified in this subdivision and the 
192.29  second one-half of excess investment income up to one-half of 
192.30  one percent of the assets of the fund must be applied to reduce 
192.31  the state amortization state aid or supplementary amortization 
192.32  state aid payments otherwise due to the relief association under 
192.33  section 423A.02 for the current calendar year.  When the 
192.34  actuarial value of assets of the fund according to the most 
192.35  recent annual actuarial valuation prepared in accordance with 
192.36  sections 356.215 and 356.216 is less than 102 percent funded and 
193.1   other conditions are met, the relief association shall pay an 
193.2   annual postretirement payment to all eligible members in an 
193.3   amount not to exceed one-half of one percent of the assets of 
193.4   the fund.  When the actuarial value of assets of the fund 
193.5   according to the most recent annual actuarial valuation prepared 
193.6   in accordance with sections 356.215 and 356.216 is greater than 
193.7   102 percent of its actuarial accrued liabilities, the relief 
193.8   association shall pay an annual postretirement payment to all 
193.9   eligible members in an amount not to exceed 1-1/2 percent of the 
193.10  assets of the fund.  Payment of the annual postretirement 
193.11  payment must be in a lump sum amount on June 1 following the 
193.12  determination date in any year.  Payment of the annual 
193.13  postretirement payment may be made only if the average time 
193.14  weighted total rate of return for the most recent prior five two 
193.15  years exceeds by two percent the actual average percentage 
193.16  increase in the current monthly salary of a top grade patrol 
193.17  officer in the most recent prior five two fiscal years.  The 
193.18  total amount of all payments to members may not exceed the 
193.19  amount determined under this subdivision.  Payment to each 
193.20  eligible member must be calculated by dividing the total number 
193.21  of pension units to which eligible members are entitled into the 
193.22  excess investment income available for distribution to members, 
193.23  and then multiplying that result by the number of units to which 
193.24  each eligible member is entitled to determine each eligible 
193.25  member's annual postretirement payment.  When the actuarial 
193.26  value of assets of the fund according to the most recent annual 
193.27  actuarial valuation prepared in accordance with sections 356.215 
193.28  and 356.216 is less than 102 percent of its actuarial accrued 
193.29  liabilities, payment to each eligible member may not exceed an 
193.30  amount equal to the total monthly benefit that the eligible 
193.31  member was entitled to in the prior year under the terms of the 
193.32  benefit plan of the relief association or each eligible member's 
193.33  proportionate share of the excess investment income, whichever 
193.34  is less.  When the actuarial value of assets of the fund 
193.35  according to the most recent annual actuarial valuation prepared 
193.36  in accordance with sections 356.215 and 356.216 is greater than 
194.1   102 percent of its actuarial accrued liabilities, payment to 
194.2   each eligible member must not exceed the member's proportionate 
194.3   share of 1-1/2 percent of the assets of the fund. 
194.4      A person who received a pension or benefit for the entire 
194.5   12 months before the determination date is eligible for a full 
194.6   annual postretirement payment.  A person who received a pension 
194.7   or benefit for less than 12 months before the determination date 
194.8   is eligible for a prorated annual postretirement payment. 
194.9      Sec. 16.  Minnesota Statutes 2004, section 423C.05, 
194.10  subdivision 2, is amended to read: 
194.11     Subd. 2.  [SERVICE PENSION.] (a) An active A member who has 
194.12  performed duty for the fire department for five years or more, 
194.13  upon written application after retiring from duty and reaching 
194.14  at least age 50, is entitled to be paid monthly for life a 
194.15  service pension under paragraph (b). 
194.16     (b) Based on the percentage that the actuarial value of 
194.17  assets of the special fund equal to the actuarial accrued 
194.18  liabilities of the special fund according to the most recent 
194.19  annual actuarial valuation of the relief association prepared in 
194.20  accordance with sections 356.215 and 356.216, The amount of the 
194.21  service pension is as follows: 
194.22  Length of    Service        Service          Service
194.23  allowable    pension        pension          pension
194.24  service      payable if     payable          payable if  
194.25  credit       under 90       if greater       greater
194.26               percent        than 89.99       than 92.49  
194.27                              percent and      percent  
194.28                              less than        Number of   
194.29                              92.5 percent     units    
194.30   5 years         -            8.0 units       8.0 units 
194.31   6 years         -            9.6 units       9.6 units 
194.32   7 years         -           11.2 units      11.2 units 
194.33   8 years         -           12.8 units      12.8 units 
194.34   9 years         -           14.4 units      14.4 units 
194.35  10 years    16.0 units       16.0 units      16.0 units
194.36  11 years    17.6 units       17.6 units      17.6 units 
195.1   12 years    19.2 units       19.2 units      19.2 units  
195.2   13 years    20.8 units       20.8 units      20.8 units  
195.3   14 years    22.4 units       22.4 units      22.4 units  
195.4   15 years    24.0 units       24.0 units      24.0 units 
195.5   16 years    25.6 units       25.6 units      25.6 units 
195.6   17 years    27.2 units       27.2 units      27.2 units 
195.7   18 years    28.8 units       28.8 units      28.8 units 
195.8   19 years    30.4 units       30.4 units      30.4 units 
195.9   20 years    33.0 units       33.5 units      34.0 units 
195.10  21 years    34.6 units       35.1 units      35.6 units 
195.11  22 years    36.2 units       37.7 units      37.2 units 
195.12  23 years    37.8 units       38.3 units      38.8 units 
195.13  24 years    39.4 units       39.9 units      40.4 units 
195.14  25 years 
195.15   or more    41.0 units       41.5 units      42.0 units
195.16     (c) A member entitled to a benefit under this subdivision 
195.17  may elect to have it paid as an optional retirement annuity 
195.18  pursuant to the conditions set forth in subdivision 8.  A member 
195.19  receiving a benefit pursuant to subdivision 5 or 6 shall not 
195.20  simultaneously be entitled to a benefit under this subdivision. 
195.21     Sec. 17.  [423C.16] [RECOMPUTATION OF DISABLED BENEFIT 
195.22  PROHIBITED.] 
195.23     Notwithstanding section 423A.11, the Board of Trustees of 
195.24  the Minneapolis Firefighters Relief Association shall not 
195.25  recompute the disability benefit of a member who became 
195.26  permanently disabled as the result of a service-related disease 
195.27  or injury.  Any prior recomputation of a disabled member's 
195.28  service-related disability pension shall be revoked upon the 
195.29  member's request and upon the member's signed and sworn 
195.30  agreement to waive any right to a recomputation of the benefit 
195.31  in the future.  Non-service-related disability pension benefits 
195.32  that were recomputed at full 25-year service pensions shall 
195.33  remain in effect.  
195.34     Sec. 18.  [NO REDUCTION OF BENEFITS.] 
195.35     Once a pension benefit is properly paid in accordance with 
195.36  the laws governing the Minneapolis Police Relief Association to 
196.1   any member, the dollar amount of the pension a member received 
196.2   shall not be reduced if the city of Minneapolis and the 
196.3   collective bargaining agent representing active police officers 
196.4   enter into or are required to abide by an agreement that would 
196.5   otherwise require the association to reduce the dollar amount of 
196.6   a pension that had properly been paid to any member. 
196.7      Sec. 19.  [AURORA, BIWABIK CITY, HOYT LAKES, AND PALO 
196.8   VOLUNTEER FIREFIGHTER RELIEF ASSOCIATIONS; CONSOLIDATION.] 
196.9      (a) This section applies to consolidation of any 
196.10  combination of two or more of the following volunteer 
196.11  firefighter relief associations:  Aurora, Biwabik City, Hoyt 
196.12  Lakes, and Palo. 
196.13     (b) Notwithstanding Minnesota Statutes, section 424B.10, 
196.14  subdivision 1, paragraph (a), the service pension to be paid by 
196.15  the relief association existing after the consolidation is as 
196.16  follows: 
196.17     (1) for the service rendered by each individual volunteer 
196.18  firefighter before the effective date of the consolidation, the 
196.19  service pension amount is the amount payable to that volunteer 
196.20  firefighter under the articles of incorporation or bylaws of the 
196.21  consolidating volunteer firefighters relief association that the 
196.22  firefighter was a member of immediately before the 
196.23  consolidation; 
196.24     (2) for the service rendered after the effective date of 
196.25  the consolidation, the service pension amount is the highest 
196.26  dollar amount service pension of any of the consolidating 
196.27  volunteer firefighters relief associations under the articles of 
196.28  incorporation or bylaws in effect immediately before the 
196.29  consolidation; and 
196.30     (3) after consolidation, increases in the amounts 
196.31  established in clauses (1) and (2) may be implemented if 
196.32  consistent with applicable requirements of Minnesota Statutes, 
196.33  chapters 69 and 424A. 
196.34     Sec. 20.  [EVELETH RETIRED POLICE AND FIRE TRUST FUND; AD 
196.35  HOC POSTRETIREMENT ADJUSTMENT.] 
196.36     (a) In addition to the current pensions and other 
197.1   retirement benefits payable, the pensions and retirement 
197.2   benefits payable to retired police officers and firefighters and 
197.3   their surviving spouses by the Eveleth police and fire trust 
197.4   fund are increased by $100 per month.  Increases are retroactive 
197.5   from January 1, 2005. 
197.6      (b) Following the January 1, 2005, effective date of the 
197.7   benefit increase provided under paragraph (a), every two years 
197.8   thereafter, to be effective no earlier than the applicable 
197.9   January 1, the city council of the city of Eveleth is authorized 
197.10  to provide permanent, uniform benefit increases, not less than 
197.11  $10 per month nor to exceed $100 per month, to any remaining 
197.12  retirees and survivors receiving benefits from the Eveleth 
197.13  police and fire trust fund.  Any given benefit improvement under 
197.14  this paragraph is not effective unless the city council passes a 
197.15  resolution approving the increase. 
197.16     (c) Within 30 days following the approval of a resolution 
197.17  under paragraph (b), the chief administrative officer of the 
197.18  city of Eveleth shall file a copy of the resolution with the 
197.19  executive director of the Legislative Commission on Pensions and 
197.20  Retirement, with the chair of the house Governmental Operations 
197.21  and Veterans Affairs Committee, and with the chair of the senate 
197.22  State and Local Government Operations Committee.  Along with a 
197.23  copy of the resolution, the city's chief administrative officer 
197.24  must send a statement indicating the age of each benefit 
197.25  recipient and the retirement benefit or survivor benefit being 
197.26  received before and after the benefit increase. 
197.27     Sec. 21.  [MAPLEWOOD AND OAKDALE VOLUNTEER FIREFIGHTER 
197.28  RELIEF ASSOCIATIONS; TRANSFER OF ASSETS.] 
197.29     Notwithstanding any limitations in Minnesota Statutes, 
197.30  section 424A.02, subdivision 13, or any other provision of law 
197.31  to the contrary, if an agreement between the affected relief 
197.32  associations and cities is reached as provided in this section, 
197.33  the Maplewood Firefighters Relief Association may transfer 
197.34  assets from its special fund to the Oakdale Fire Department 
197.35  Relief Association representing the value of the accumulated 
197.36  service credit for the current members of the Oakdale Fire 
198.1   Department Relief Association who are currently eligible to 
198.2   receive a combined service pension for firefighter service in 
198.3   both associations.  The transfer of the assets from the 
198.4   Maplewood Firefighters Relief Association to the Oakdale Fire 
198.5   Department Relief Association must be in an amount representing 
198.6   the cumulative value of the service credit earned by the members 
198.7   of the Oakdale Fire Department Relief Association who are 
198.8   currently eligible to receive a combined service pension for 
198.9   firefighting service in both associations for the service credit 
198.10  that they accrued while working for the Maplewood Fire 
198.11  Department.  The amount of the assets, liabilities, and service 
198.12  credit to be transferred must be specified in a joint agreement 
198.13  negotiated by the secretaries of the two relief associations and 
198.14  ratified by the boards of trustees of both relief associations 
198.15  and of the cities of Maplewood and Oakdale.  The agreement must 
198.16  specify by name or other appropriate means the firefighters 
198.17  affected by the liability, asset, and service credit transfer.  
198.18  The ratification must be expressed in the form of resolutions 
198.19  adopted by each entity.  The agreements must specify the amount 
198.20  of assets to be transferred, the amount of liabilities to be 
198.21  transferred, and the amount of service credit each of the 
198.22  applicable individuals will receive in the Oakdale Fire 
198.23  Department Relief Association.  Upon the ratification of the 
198.24  agreement by both relief associations and both cities, the 
198.25  assets, liabilities, and service credit of the applicable 
198.26  individuals must be transferred to the Oakdale Fire Department 
198.27  Relief Association, and the Maplewood Firefighters Relief 
198.28  Association is relieved of any obligation to the individuals.  A 
198.29  certified copy of the ratified agreement must be filed with the 
198.30  state auditor and with the secretary of state. 
198.31     Sec. 22.  [EFFECTIVE DATE; LOCAL APPROVAL.] 
198.32     (a) Sections 1 and 2 are effective the day after the date 
198.33  on which the city council of the city of Bloomington and its 
198.34  chief clerical officer timely complete their compliance with 
198.35  Minnesota Statutes, section 645.021, subdivisions 2 and 4. 
198.36     (b) Sections 3 to 10 are not severable and are effective on 
199.1   the day after the date of the approval by the city council of 
199.2   the city of Minneapolis and the timely completion by the chief 
199.3   clerical officer of the city of Minneapolis of compliance with 
199.4   Minnesota Statutes, section 645.021, subdivisions 2 and 3. 
199.5      (c) Sections 3, 4, 5, 6, and 7 are effective on the day 
199.6   after the board of Hennepin County and its chief clerical 
199.7   officer complete in a timely manner their compliance with 
199.8   Minnesota Statutes, section 645.021, subdivisions 2 and 3.  
199.9      (d) Section 8 is effective on the day after the Minneapolis 
199.10  city council and the chief clerical officer of the city of 
199.11  Minneapolis complete in a timely manner their compliance with 
199.12  Minnesota Statutes, section 645.021, subdivisions 2 and 3.  
199.13     (e) Sections 9 and 10 are effective on the day after the 
199.14  governing body of the city of Minneapolis and its chief clerical 
199.15  officer timely complete their compliance with Minnesota 
199.16  Statutes, section 645.021, subdivisions 2 and 3. 
199.17     (f) Section 4 is effective the day after the date on which 
199.18  the city council of the city of Eveleth and its chief clerical 
199.19  officer timely complete their compliance with Minnesota 
199.20  Statutes, section 645.021, subdivisions 2 and 3. 
199.21     (g) Section 3 is effective with respect to a volunteer 
199.22  firefighters relief association listed in column A the day after 
199.23  the governing body of the municipality listed in column B and 
199.24  its chief clerical officer timely complete compliance with 
199.25  Minnesota Statutes, section 645.021, subdivisions 2 and 3. 
199.26                   A                      B       
199.27                Aurora              city of Aurora
199.28                Biwabik             city of Biwabik
199.29                Hoyt Lakes          city of Hoyt Lakes
199.30                Palo                town of White
199.31     (h) Section 5 is effective the day after the governing body 
199.32  of the city of Maplewood, the governing body of the city of 
199.33  Oakdale, the Maplewood chief clerical officer, and the Oakdale 
199.34  chief clerical officer complete their compliance with Minnesota 
199.35  Statutes, section 645.021, subdivisions 2 and 3. 
199.36                             ARTICLE 14 
200.1                   MINNEAPOLIS EMPLOYEES RETIREMENT 
200.2                             FUND CHANGES 
200.3      Section 1.  Minnesota Statutes 2004, section 43A.17, 
200.4   subdivision 9, is amended to read: 
200.5      Subd. 9.  [POLITICAL SUBDIVISION COMPENSATION LIMIT.] (a) 
200.6   The salary and the value of all other forms of compensation of a 
200.7   person employed by a political subdivision of this state, 
200.8   excluding a school district, or employed under section 422A.03 
200.9   may not exceed 95 percent of the salary of the governor as set 
200.10  under section 15A.082, except as provided in this subdivision.  
200.11  For purposes of this subdivision, "political subdivision of this 
200.12  state" includes a statutory or home rule charter city, county, 
200.13  town, metropolitan or regional agency, or other political 
200.14  subdivision, but does not include a hospital, clinic, or health 
200.15  maintenance organization owned by such a governmental unit or a 
200.16  retirement plan governed by chapter 422A.  
200.17     (b) Deferred compensation and payroll allocations to 
200.18  purchase an individual annuity contract for an employee are 
200.19  included in determining the employee's salary.  Other forms of 
200.20  compensation which shall be included to determine an employee's 
200.21  total compensation are all other direct and indirect items of 
200.22  compensation which are not specifically excluded by this 
200.23  subdivision.  Other forms of compensation which shall not be 
200.24  included in a determination of an employee's total compensation 
200.25  for the purposes of this subdivision are: 
200.26     (1) employee benefits that are also provided for the 
200.27  majority of all other full-time employees of the political 
200.28  subdivision, vacation and sick leave allowances, health and 
200.29  dental insurance, disability insurance, term life insurance, and 
200.30  pension benefits or like benefits the cost of which is borne by 
200.31  the employee or which is not subject to tax as income under the 
200.32  Internal Revenue Code of 1986; 
200.33     (2) dues paid to organizations that are of a civic, 
200.34  professional, educational, or governmental nature; and 
200.35     (3) reimbursement for actual expenses incurred by the 
200.36  employee which the governing body determines to be directly 
201.1   related to the performance of job responsibilities, including 
201.2   any relocation expenses paid during the initial year of 
201.3   employment. 
201.4      The value of other forms of compensation shall be the 
201.5   annual cost to the political subdivision for the provision of 
201.6   the compensation.  
201.7      (c) The salary of a medical doctor or doctor of osteopathy 
201.8   occupying a position that the governing body of the political 
201.9   subdivision has determined requires an M.D. or D.O. degree is 
201.10  excluded from the limitation in this subdivision.  
201.11     (d) The commissioner may increase the limitation in this 
201.12  subdivision for a position that the commissioner has determined 
201.13  requires special expertise necessitating a higher salary to 
201.14  attract or retain a qualified person.  The commissioner shall 
201.15  review each proposed increase giving due consideration to salary 
201.16  rates paid to other persons with similar responsibilities in the 
201.17  state and nation.  The commissioner may not increase the 
201.18  limitation until the commissioner has presented the proposed 
201.19  increase to the Legislative Coordinating Commission and received 
201.20  the commission's recommendation on it.  The recommendation is 
201.21  advisory only.  If the commission does not give its 
201.22  recommendation on a proposed increase within 30 days from its 
201.23  receipt of the proposal, the commission is deemed to have made 
201.24  no recommendation. 
201.25     Sec. 2.  Minnesota Statutes 2004, section 422A.05, 
201.26  subdivision 2c, is amended to read: 
201.27     Subd. 2c.  [MINNEAPOLIS EMPLOYEES RETIREMENT FUND 
201.28  INVESTMENT AUTHORITY.] (a) For investments made on or after July 
201.29  1, 1991, the board shall invest funds only in investments 
201.30  authorized by section 356A.06, subdivision 7.  
201.31     (b) However, in addition to real estate investments 
201.32  authorized under paragraph (a), the board may also make loans to 
201.33  purchasers of Minnesota situs nonfarm residential real estate 
201.34  that is owned by the Minneapolis Employees Retirement Fund.  The 
201.35  loans must be secured by mortgages or deeds of trust.  
201.36     (c) For investments made before July 1, 1991, the board 
202.1   may, but is not required to, comply with paragraph (a).  
202.2   However, with respect to these investments, the board shall act 
202.3   in accordance with subdivision 2a and chapter 356A. 
202.4      (d) The board may certify assets for investment by the 
202.5   State Board of Investment under sections 11A.14 and 11A.17.  
202.6      Sec. 3.  Minnesota Statutes 2004, section 422A.06, 
202.7   subdivision 3, is amended to read: 
202.8      Subd. 3.  [DEPOSIT ACCUMULATION FUND.] (a) The deposit 
202.9   accumulation fund consists of the assets held in the fund, 
202.10  including amounts contributed by or for employees, amounts 
202.11  contributed by the city, amounts contributed by municipal 
202.12  activities supported in whole or in part by revenues other than 
202.13  taxes and amounts contributed by any public corporation, amounts 
202.14  paid by the state, and by income from investments.  
202.15     (b) There must be paid from the fund the amounts required 
202.16  to be transferred to the retirement benefit fund, or the 
202.17  disability benefit fund, refunds of contributions, including the 
202.18  death-while-active refund specified in section 422A.22, 
202.19  subdivision 4, postretirement increases in retirement allowances 
202.20  granted under Laws 1965, chapter 688, or Laws 1969, chapter 859, 
202.21  and expenses of the administration of the retirement fund which 
202.22  were not charged by the retirement board against the income of 
202.23  the retirement benefit fund from investments as the cost of 
202.24  handling the investments of the retirement benefit fund. 
202.25     (c) To the extent that the deposit accumulation fund has 
202.26  insufficient assets to transfer the total value of the required 
202.27  reserves for retirement annuities to either the disability 
202.28  benefit fund under subdivisions 5 and 7 or the retirement 
202.29  benefit fund under subdivisions 5 and 8 as required, the deposit 
202.30  accumulation fund has a transfer amount payable on which an 
202.31  interest charge accrues.  The executive director must determine 
202.32  the interest charge for the period that transfer amount payable 
202.33  remains unpaid at an annual rate equal to five percent plus the 
202.34  percentage increase in the amount of the annual Consumer Price 
202.35  Index for urban wage earners and clerical workers as calculated 
202.36  by the Bureau of Labor Statistics of the United States 
203.1   Department of Labor from the previous June 30.  The interest 
203.2   charge must be reflected in the books of the Minneapolis 
203.3   Employees Retirement Fund and assessed against the deposit 
203.4   accumulation fund based on the average quarterly transfer amount 
203.5   payable balance outstanding.  Any revenue received by the 
203.6   deposit accumulation fund subsequent to unpaid transfers must be 
203.7   transferred from the deposit accumulation fund to the disability 
203.8   benefit fund or to the retirement fund, whichever applies, must 
203.9   first be applied to any remaining interest charge and then must 
203.10  be applied to the principal amount of transfer amount payable 
203.11  outstanding.  
203.12     Sec. 4.  Minnesota Statutes 2004, section 422A.06, 
203.13  subdivision 5, is amended to read: 
203.14     Subd. 5.  [TRANSFER OF RESERVES TO RETIREMENT BENEFIT FUND; 
203.15  ADJUSTMENTS OF ANNUITIES AND BENEFITS.] (a) Assets equal to the 
203.16  required reserves for retirement annuities as determined in 
203.17  accordance with the appropriate mortality table adopted by the 
203.18  board of trustees based on the experience of the fund as 
203.19  recommended by the commission-retained actuary retained under 
203.20  section 356.214 and using the postretirement interest assumption 
203.21  specified in section 356.215, subdivision 8, shall must be 
203.22  transferred to the disability benefit fund as provided in 
203.23  subdivision 7, or the retirement benefit fund, except for any 
203.24  amounts payable from the survivor benefit fund, as of date of 
203.25  retirement. 
203.26     (b) If a full transfer amount is not payable from the 
203.27  deposit accumulation fund, the applicable fund must be credited 
203.28  with an interest-bearing transfer amount receivable. 
203.29     (b) (c) Annuity payments shall must be adjusted in 
203.30  accordance with this chapter, except that no minimum retirement 
203.31  payments described in this chapter shall must include any 
203.32  amounts payable from the survivors' benefit fund or disability 
203.33  benefit fund and supplemented benefits specifically financed by 
203.34  statute. 
203.35     (c) (d) Increases in annuity payments pursuant to under 
203.36  this section shall be made automatically unless written notice 
204.1   on a form prescribed by the board is filed with the retirement 
204.2   board requesting that the increase not be made. 
204.3      (d) (e) Any additional annuity which began to accrue on 
204.4   July 1, 1973, or which began to accrue on January 1, 1974, 
204.5   pursuant to Laws 1973, chapter 770, section 1, shall must be 
204.6   considered as part of the base amount to be used in determining 
204.7   any postretirement adjustments payable pursuant to under the 
204.8   provisions of subdivision 8. 
204.9      Sec. 5.  Minnesota Statutes 2004, section 422A.06, 
204.10  subdivision 7, is amended to read: 
204.11     Subd. 7.  [DISABILITY BENEFIT FUND.] (a) Unless subdivision 
204.12  3, paragraph (c), applies, the required reserves for disability 
204.13  allowances which become effective after December 31, 1973, shall 
204.14  must be transferred from the deposit accumulation fund to the 
204.15  disability benefit fund.  A proportionate share of income from 
204.16  investments shall must be allocated to this fund and any 
204.17  interest charge under subdivision 3, paragraph (c), must be 
204.18  credited to the fund.  There shall be paid From this fund, the 
204.19  disability allowances which become effective after December 31, 
204.20  1973, must be paid. 
204.21     (b) In the event of termination of any disability allowance 
204.22  for any reason other than the death of the recipient, the 
204.23  balance of the required reserves for the disability allowance as 
204.24  of the date of termination shall must be transferred from the 
204.25  disability benefit fund to the deposit accumulation fund. 
204.26     (c) At the end of each fiscal year, as part of the annual 
204.27  actuarial valuation, a determination shall must be made of the 
204.28  required reserves for all disability allowances being paid from 
204.29  the disability benefit fund.  Any excess of assets over 
204.30  actuarial required reserves in the disability benefit fund shall 
204.31  must be transferred to the deposit accumulation fund.  Unless 
204.32  subdivision 3, paragraph (c), applies, any excess of actuarial 
204.33  reserves over assets in the disability benefit fund shall must 
204.34  be funded by a transfer of the appropriate amount of assets from 
204.35  the deposit accumulation fund. 
204.36     Sec. 6.  Minnesota Statutes 2004, section 422A.06, 
205.1   subdivision 8, is amended to read: 
205.2      Subd. 8.  [RETIREMENT BENEFIT FUND.] (a) The retirement 
205.3   benefit fund shall consist consists of amounts held for payment 
205.4   of retirement allowances for members retired pursuant to under 
205.5   this chapter, including any transfer amount payable under 
205.6   subdivision 3, paragraph (c).  
205.7      (b) Unless subdivision 3, paragraph (c), applies, assets 
205.8   equal to the required reserves for retirement 
205.9   allowances pursuant to under this chapter determined in 
205.10  accordance with the appropriate mortality table adopted by the 
205.11  board of trustees based on the experience of the fund as 
205.12  recommended by the commission-retained actuary shall retained 
205.13  under section 356.214, must be transferred from the deposit 
205.14  accumulation fund to the retirement benefit fund as of the last 
205.15  business day of the month in which the retirement allowance 
205.16  begins.  The income from investments of these assets shall must 
205.17  be allocated to this fund and any interest charge under 
205.18  subdivision 3, paragraph (c), must be credited to the fund.  
205.19  There shall must be paid from this fund the retirement annuities 
205.20  authorized by law.  A required reserve calculation for the 
205.21  retirement benefit fund must be made by the actuary retained by 
205.22  the Legislative Commission on Pensions and Retirement under 
205.23  section 356.214 and must be certified to the retirement board by 
205.24  the commission-retained actuary. 
205.25     (c) The retirement benefit fund shall must be governed by 
205.26  the applicable laws governing the accounting and audit 
205.27  procedures, investment, actuarial requirements, calculation and 
205.28  payment of postretirement benefit adjustments, discharge of any 
205.29  deficiency in the assets of the fund when compared to the 
205.30  actuarially determined required reserves, and other applicable 
205.31  operations and procedures regarding the Minnesota postretirement 
205.32  investment fund in effect on June 30, 1997, established under 
205.33  Minnesota Statutes 1996, section 11A.18, and any legal or 
205.34  administrative interpretations of those laws of the State Board 
205.35  of Investment, the legal advisor to the Board of Investment and 
205.36  the executive director of the State Board of Investment in 
206.1   effect on June 30, 1997.  If a deferred yield adjustment account 
206.2   is established for the Minnesota postretirement investment fund 
206.3   before June 30, 1997, under Minnesota Statutes 1996, section 
206.4   11A.18, subdivision 5, the retirement board shall also establish 
206.5   and maintain a deferred yield adjustment account within this 
206.6   fund.  
206.7      (d) Annually, following the calculation of any 
206.8   postretirement adjustment payable from the retirement benefit 
206.9   fund, the board of trustees shall submit a report to the 
206.10  executive director of the Legislative Commission on Pensions and 
206.11  Retirement and to the commissioner of finance indicating the 
206.12  amount of any postretirement adjustment and the underlying 
206.13  calculations on which that postretirement adjustment amount is 
206.14  based, including the amount of dividends, the amount of 
206.15  interest, and the amount of net realized capital gains or losses 
206.16  utilized in the calculations. 
206.17     (e) With respect to a former contributing member who began 
206.18  receiving a retirement annuity or disability benefit under 
206.19  section 422A.151, paragraph (a), clause (2), after June 30, 
206.20  1997, or with respect to a survivor of a former contributing 
206.21  member who began receiving a survivor benefit under section 
206.22  422A.151, paragraph (a), clause (2), after June 30, 1997, the 
206.23  reserves attributable to the one percent lower amount of the 
206.24  cost-of-living adjustment payable to those annuity or benefit 
206.25  recipients annually must be transferred back to the deposit 
206.26  accumulation fund to the credit of the Metropolitan Airports 
206.27  Commission.  The calculation of this annual reduced 
206.28  cost-of-living adjustment reserve transfer must be reviewed by 
206.29  the actuary retained by the Legislative Commission on Pensions 
206.30  and Retirement under section 356.214. 
206.31     Sec. 7.  Minnesota Statutes 2004, section 422A.101, 
206.32  subdivision 3, is amended to read: 
206.33     Subd. 3.  [STATE CONTRIBUTIONS.] (a) Subject to the 
206.34  limitation set forth in paragraph (c), the state shall pay to 
206.35  the Minneapolis Employees Retirement Fund annually an amount 
206.36  equal to the amount calculated under paragraph (b). 
207.1      (b) The payment amount is an amount equal to the financial 
207.2   requirements of the Minneapolis Employees Retirement Fund 
207.3   reported in the actuarial valuation of the fund prepared by the 
207.4   commission-retained actuary pursuant to section 356.215 for the 
207.5   most recent year but based on a target date for full 
207.6   amortization of the unfunded actuarial accrued liabilities by 
207.7   June 30, 2020, less the amount of employee contributions 
207.8   required pursuant to section 422A.10, and the amount of employer 
207.9   contributions required pursuant to subdivisions 1a, 2, and 2a.  
207.10  Payments shall be made September 15 annually.  
207.11     (c) The annual state contribution under this subdivision 
207.12  may not exceed $9,000,000, plus the cost of the annual 
207.13  supplemental benefit determined under section 356.43. 
207.14     (d) If the amount determined under paragraph (b) exceeds 
207.15  $11,910,000 $9,000,000, the excess must be allocated to and paid 
207.16  to the fund by the employers identified in subdivisions 1a and 
207.17  2, other than units of metropolitan government.  Each employer's 
207.18  share of the excess is proportionate to the employer's share of 
207.19  the fund's unfunded actuarial accrued liability as disclosed in 
207.20  the annual actuarial valuation prepared by the actuary 
207.21  retained by the Legislative Commission on Pensions and 
207.22  Retirement under section 356.214 compared to the total unfunded 
207.23  actuarial accrued liability attributed to all employers 
207.24  identified in subdivisions 1a and 2, other than units of 
207.25  metropolitan government.  Payments must be made in equal 
207.26  installments as set forth in paragraph (b). 
207.27     Sec. 8.  [REPEALER.] 
207.28     Minnesota Statutes 2004, section 422A.101, subdivision 4, 
207.29  is repealed.  
207.30     Sec. 9.  [EFFECTIVE DATE; LOCAL APPROVAL.] 
207.31     Sections 1 to 8 are effective on the day after the city 
207.32  council of the city of Minneapolis and its chief clerical 
207.33  officer timely complete their compliance with Minnesota 
207.34  Statutes, section 645.021, subdivisions 2 and 3. 
207.35                             ARTICLE 15 
207.36                     ONE PERSON AND SMALL GROUP 
208.1                          RETIREMENT CHANGES 
208.2      Section 1.  [SURVIVOR BENEFIT FOR ST. LOUIS PARK POLICE 
208.3   OFFICER KILLED IN IRAQ CONFLICT.] 
208.4      Subdivision 1.  [ELIGIBILITY.] (a) Notwithstanding any 
208.5   provision of Minnesota Statutes, section 353.657, subdivision 1, 
208.6   regarding required length of marriage, an eligible person 
208.7   described in paragraph (b) is authorized to apply for a 
208.8   surviving spouse annuity from the public employees police and 
208.9   fire retirement plan to be computed under Minnesota Statutes, 
208.10  section 353.657, subdivision 2. 
208.11     (b) An eligible person for purposes of paragraph (a) is the 
208.12  surviving spouse of a deceased public employees police and fire 
208.13  retirement plan member who: 
208.14     (1) was born on October 29, 1979; 
208.15     (2) was a member of the public employees police and fire 
208.16  retirement plan commencing on January 24, 2004, due to 
208.17  employment as a police officer by the city of St. Louis Park; 
208.18  and 
208.19     (3) died on February 21, 2005, while providing military 
208.20  service in Iraq. 
208.21     Subd. 2.  [APPLICATION PROCESS.] An eligible person 
208.22  described in subdivision 1 is authorized to apply for the 
208.23  applicable surviving spouse annuity on a form or forms provided 
208.24  by the executive director of the Public Employees Retirement 
208.25  Association.  The person must provide sufficient documentation 
208.26  of eligibility to the executive director, as the executive 
208.27  director may prescribe. 
208.28     Subd. 3.  [REFUND REPAYMENT AUTHORIZATION.] An annuity 
208.29  under this section is in lieu of any death refund to which an 
208.30  eligible person would otherwise be entitled.  If an eligible 
208.31  person has received a death refund, that person is authorized to 
208.32  repay that refund, under the terms specified in Minnesota 
208.33  Statutes, section 353.35, notwithstanding any law to the 
208.34  contrary. 
208.35     Subd. 4.  [RETROACTIVE APPLICATION.] If a valid benefit 
208.36  application is made by an eligible person under this section, 
209.1   the monthly annuity payments commence retroactive to February 
209.2   21, 2005.  
209.3      Sec. 2.  [PURCHASE OF PRIOR SERVICE CREDIT.] 
209.4      (a) An eligible person described in paragraph (b) is 
209.5   entitled to purchase up to one year of allowable service credit 
209.6   from the Teachers Retirement Association for the 2003-2004 
209.7   school year.  The service credit purchase under this section 
209.8   must be made in accordance with Minnesota Statutes, section 
209.9   356.551, except as otherwise stated in this section. 
209.10     (b) An eligible person is a person who: 
209.11     (1) is currently a member of the Teachers Retirement 
209.12  Association; 
209.13     (2) was born on April 2, 1949; 
209.14     (3) has been employed by Independent School District No. 
209.15  11, Anoka-Hennepin, since the 1971-1972 school year; 
209.16     (4) applied for and was granted an extended leave of 
209.17  absence from Independent School District No. 11, Anoka-Hennepin, 
209.18  for the 2002-2003, 2003-2004, and 2004-2005 school years under 
209.19  Minnesota Statutes, section 122A.46; 
209.20     (5) was unable to make timely payment for the 2003-2004 
209.21  school year under Minnesota Statutes, section 354.094, because 
209.22  of a problem in transferring funds from the individual's 
209.23  tax-sheltered annuity account; and 
209.24     (6) was not permitted by the Teachers Retirement 
209.25  Association to make payment after June 30, 2004, with interest. 
209.26     (c) Notwithstanding Minnesota Statutes, section 356.551, 
209.27  payment must be made by September 1, 2005, or prior to 
209.28  termination of service, whichever is earlier, and the employee 
209.29  payment amount is an amount equal to the employee contribution 
209.30  rate in effect during the 2003-2004 school year applied to the 
209.31  eligible individual's salary in the year prior to the leave, 
209.32  plus .708 percent monthly interest from June 30, 2004, until the 
209.33  end of the month in which payment is made.  If the full payment 
209.34  required under this paragraph is made, then notwithstanding 
209.35  Minnesota Statutes, section 354.094, the individual is 
209.36  authorized under Minnesota Statutes, section 354.094, to make 
210.1   the required contribution for the 2004-2005 school year, and any 
210.2   subsequent years of the leave.  Notwithstanding payment 
210.3   deadlines in Minnesota Statutes, section 354.094, the employee 
210.4   contribution for the 2004-2005 school year must be made on or 
210.5   before September 30, 2005, with .708 percent monthly interest 
210.6   from June 30, 2005, until paid.  
210.7      (d) If payment is received under paragraph (c), the 
210.8   executive director of the Teachers Retirement Association shall 
210.9   bill Independent School District No. 11, Anoka-Hennepin, for the 
210.10  employer contribution that would have been made on behalf of the 
210.11  eligible person for the 2003-2004 fiscal year under Minnesota 
210.12  Statutes, section 354.094.  The remainder of the full actuarial 
210.13  value payment under Minnesota Statutes, section 356.551, is 
210.14  waived.  If the school district fails to make payment under this 
210.15  paragraph within 30 days of notification of the amount due, the 
210.16  executive director shall notify the commissioner of the 
210.17  Department of Finance of that fact and the employer payment 
210.18  amount shall be deducted from any subsequent state aid to the 
210.19  school district.  
210.20     Sec. 3.  [EFFECTIVE DATE.] 
210.21     (a) For purposes of determining whether section 1 becomes 
210.22  effective, the board of trustees of the Public Employees 
210.23  Retirement Association shall be considered to be comparable to 
210.24  the city council of a local government unit. 
210.25     (b) Section 1 is effective on the day after the board of 
210.26  trustees of the Public Employees Retirement Association and its 
210.27  executive director complete in a timely manner their compliance 
210.28  with Minnesota Statutes, section 645.021, subdivisions 2 and 3. 
210.29     (c) Section 2 is effective on the day following final 
210.30  enactment.