LCPR03-243
1.1 ............... moves to amend H.F. No. ....; S.F. No.
1.2 ...., as follows:
1.3 Delete everything after the enacting clause and insert:
1.4 "ARTICLE 1
1.5 MEMBERSHIP ISSUES
1.6 Section 1. Minnesota Statutes 2002, section 353.01,
1.7 subdivision 2b, is amended to read:
1.8 Subd. 2b. EXCLUDED EMPLOYEES. The following public
1.9 employees are not eligible to participate as members of the
1.10 association with retirement coverage by the public employees
1.11 retirement plan, the local government correctional employees
1.12 retirement plan under chapter 353E, or the public employees
1.13 police and fire retirement plan:
1.14 (1) public officers, other than county sheriffs, who are
1.15 elected to a governing body, or persons who are appointed to
1.16 fill a vacancy in an elective office of a governing body, whose
1.17 term of office first commences on or after July 1, 2002, for the
1.18 service to be rendered in that elective position. Elected
1.19 governing body officials who were active members of the
1.20 association's coordinated or basic retirement plans as of June
1.21 30, 2002, continue participation throughout incumbency in office
1.22 until termination of public service occurs as defined in
1.23 subdivision 11a;
1.24 (2) election officers or election judges;
1.25 (3) patient and inmate personnel who perform services for a
1.26 governmental subdivision;
1.27 (4) except as otherwise specified in subdivision 12a,
1.28 employees who are hired for a temporary position as defined
1.29 under subdivision 12a, and employees who resign from a
1.30 nontemporary position and accept a temporary position within 30
1.31 days in the same governmental subdivision.; An employer must not
1.32 apply the definition of temporary position so as to exclude
1.33 employees who are hired to fill positions that are permanent or
1.34 that are for an unspecified period but who are serving a
1.35 probationary period at the start of the employment. If the
1.36 period of employment extends beyond six consecutive months and
2.1 the employee earns more than $425 from one governmental
2.2 subdivision in any calendar month, the department head shall
2.3 report the employee for membership and require employee
2.4 deductions be made on behalf of the employee under section
2.5 353.27, subdivision 4.
2.6 The membership eligibility of an employee who resigns or is
2.7 dismissed from a temporary position and within 30 days accepts
2.8 another temporary position in the same governmental subdivision
2.9 is determined on the total length of employment rather than on
2.10 each separate position. Membership eligibility of an employee
2.11 who holds concurrent temporary and nontemporary positions in one
2.12 governmental subdivision is determined by the length of
2.13 employment and salary of each separate position;
2.14 (5) employees who are employed by reason of work emergency
2.15 caused by fire, flood, storm, or similar disaster;
2.16 (6) employees who by virtue of their employment in one
2.17 governmental subdivision are required by law to be a member of
2.18 and to contribute to any of the plans or funds administered by
2.19 the Minnesota state retirement system, the teachers retirement
2.20 association, the Duluth teachers retirement fund association,
2.21 the Minneapolis teachers retirement fund association, the St.
2.22 Paul teachers retirement fund association, the Minneapolis
2.23 employees retirement fund, or any police or firefighters relief
2.24 association governed by section 69.77 that has not consolidated
2.25 with the public employees retirement association, or any local
2.26 police or firefighters consolidation account but who have not
2.27 elected the type of benefit coverage provided by the public
2.28 employees police and fire fund under sections 353A.01 to
2.29 353A.10, or any persons covered by section 353.665, subdivision
2.30 4, 5, or 6, who have not elected public employees police and
2.31 fire plan benefit coverage. This clause must not be construed
2.32 to prevent a person from being a member of and contributing to
2.33 the public employees retirement association and also belonging
2.34 to and contributing to another public pension plan or fund for
2.35 other service occurring during the same period of time. A
2.36 person who meets the definition of "public employee" in
3.1 subdivision 2 by virtue of other service occurring during the
3.2 same period of time becomes a member of the association unless
3.3 contributions are made to another public retirement fund on the
3.4 salary based on the other service or to the teachers retirement
3.5 association by a teacher as defined in section 354.05,
3.6 subdivision 2;
3.7 (7) persons who are members of a religious order and are
3.8 excluded from coverage under the federal Old Age, Survivors,
3.9 Disability, and Health Insurance Program for the performance of
3.10 service as specified in United States Code, title 42, section
3.11 410(a)(8)(A), as amended through January 1, 1987, if no
3.12 irrevocable election of coverage has been made under section
3.13 3121(r) of the Internal Revenue Code of 1954, as amended;
3.14 (8) employees of a governmental subdivision who have not
3.15 reached the age of 23 and are enrolled on a full-time basis to
3.16 attend or are attending classes on a full-time basis at an
3.17 accredited school, college, or university in an undergraduate,
3.18 graduate, or professional-technical program, or a public or
3.19 charter high school;
3.20 (9) resident physicians, medical interns, and pharmacist
3.21 residents and pharmacist interns who are serving in a degree or
3.22 residency program in public hospitals;
3.23 (10) students who are serving in an internship or residency
3.24 program sponsored by an accredited educational institution;
3.25 (11) persons who hold a part-time adult supplementary
3.26 technical college license who render part-time teaching service
3.27 in a technical college;
3.28 (12) except for employees of Hennepin county, foreign
3.29 citizens working for a governmental subdivision with a work
3.30 permit of less than three years, or an H-1b visa valid for less
3.31 than three years of employment. Upon notice to the association
3.32 that the work permit or visa extends beyond the three-year
3.33 period, the foreign citizens are to must be reported for
3.34 membership from the date of the extension;
3.35 (13) public hospital employees who elected not to
3.36 participate as members of the association before 1972 and who
4.1 did not elect to participate from July 1, 1988, to October 1,
4.2 1988;
4.3 (14) except as provided in section 353.86, volunteer
4.4 ambulance service personnel, as defined in subdivision 35, but
4.5 persons who serve as volunteer ambulance service personnel may
4.6 still qualify as public employees under subdivision 2 and may be
4.7 members of the public employees retirement association and
4.8 participants in the public employees retirement fund or the
4.9 public employees police and fire fund, whichever applies, on the
4.10 basis of compensation received from public employment service
4.11 other than service as volunteer ambulance service personnel;
4.12 (15) except as provided in section 353.87, volunteer
4.13 firefighters, as defined in subdivision 36, engaging in
4.14 activities undertaken as part of volunteer firefighter duties;
4.15 provided that a person who is a volunteer firefighter may still
4.16 qualify as a public employee under subdivision 2 and may be a
4.17 member of the public employees retirement association and a
4.18 participant in the public employees retirement fund or the
4.19 public employees police and fire fund, whichever applies, on the
4.20 basis of compensation received from public employment activities
4.21 other than those as a volunteer firefighter;
4.22 (16) pipefitters and associated trades personnel employed
4.23 by independent school district No. 625, St. Paul, with coverage
4.24 under a collective bargaining agreement by the pipefitters local
4.25 455 pension plan who were either first employed after May 1,
4.26 1997, or, if first employed before May 2, 1997, elected to be
4.27 excluded under Laws 1997, chapter 241, article 2, section 12;
4.28 (17) electrical workers, plumbers, carpenters, and
4.29 associated trades personnel employed by independent school
4.30 district No. 625, St. Paul, or the city of St. Paul, who have
4.31 retirement coverage under a collective bargaining agreement by
4.32 the electrical workers local 110 pension plan, the united
4.33 association plumbers local 34 pension plan, or the carpenters
4.34 local 87 pension plan who were either first employed after May
4.35 1, 2000, or, if first employed before May 2, 2000, elected to be
4.36 excluded under Laws 2000, chapter 461, article 7, section 5;
5.1 (18) bricklayers, allied craftworkers, cement masons,
5.2 glaziers, glassworkers, painters, allied tradesworkers, and
5.3 plasterers employed by the city of St. Paul or independent
5.4 school district No. 625, St. Paul, with coverage under a
5.5 collective bargaining agreement by the bricklayers and allied
5.6 craftworkers local 1 pension plan, the cement masons local 633
5.7 pension plan, the glaziers and glassworkers local L-1324 pension
5.8 plan, the painters and allied trades local 61 pension plan, or
5.9 the Twin Cities plasterers local 265 pension plan who were
5.10 either first employed after May 1, 2001, or if first employed
5.11 before May 2, 2001, elected to be excluded under Laws 2001,
5.12 First Special Session chapter 10, article 10, section 6;
5.13 (19) plumbers employed by the metropolitan airports
5.14 commission, with coverage under a collective bargaining
5.15 agreement by the plumbers local 34 pension plan, who either were
5.16 first employed after May 1, 2001, or if first employed before
5.17 May 2, 2001, elected to be excluded under Laws 2001, First
5.18 Special Session chapter 10, article 10, section 6;
5.19 (20) employees who are hired after June 30, 2002, to fill
5.20 seasonal positions under subdivision 12b which are limited in
5.21 duration by the employer to 185 consecutive calendar days or
5.22 less in each year of employment with the governmental
5.23 subdivision;
5.24 (21) persons who are provided supported employment or
5.25 work-study positions by a governmental subdivision and who
5.26 participate in an employment or industries program maintained
5.27 for the benefit of these persons where the governmental
5.28 subdivision limits the position's duration to three years or
5.29 less, including persons participating in a federal or state
5.30 subsidized on-the-job training, work experience, senior citizen,
5.31 youth, or unemployment relief program where the training or work
5.32 experience is not provided as a part of, or for, future
5.33 permanent public employment;
5.34 (22) independent contractors and the employees of
5.35 independent contractors; and
5.36 (23) reemployed annuitants of the association during the
6.1 course of that reemployment.
6.2 Sec. 2. Minnesota Statutes 2002, section 353.01,
6.3 subdivision 12a, is amended to read:
6.4 Subd. 12a. TEMPORARY POSITION. (1) (a) "Temporary
6.5 position" means an employment position predetermined by the
6.6 employer at the time of hiring to be a period of six months or
6.7 less. Temporary position also means an employment position
6.8 occupied by a person hired by the employer as a temporary
6.9 replacement who is employed for a predetermined period of six
6.10 months or less.
6.11 (2) (b) "Temporary position" does not mean an employment
6.12 position for a specified or unspecified term in which a person
6.13 serves a probationary period as a requirement for subsequent
6.14 employment on a permanent or unlimited basis.
6.15 (c) If employment in a temporary position extends beyond
6.16 six consecutive months, the head of the department shall report
6.17 the employee for membership if salary in any month exceeds the
6.18 salary threshold specified in subdivision 2a. The membership
6.19 eligibility of an employee who resigns or is dismissed from a
6.20 temporary position and accepts another temporary position in the
6.21 same governmental subdivision within 30 days is determined on
6.22 the total length of employment rather than on each separate
6.23 position.
6.24 Sec. 3. Minnesota Statutes 2002, section 353.01,
6.25 subdivision 12b, is amended to read:
6.26 Subd. 12b. SEASONAL POSITION. "Seasonal position" means
6.27 a position where the nature of the work or its duration are
6.28 related to a specific season or seasons of the year, regardless
6.29 of whether or not the employing agency anticipates that the same
6.30 employee will return to the position each season in which it
6.31 becomes available. The entire period of employment in a
6.32 business year must be used to determine whether or not a
6.33 position may be excluded as seasonal when there is less than a
6.34 30-day break between one seasonal position and a subsequent
6.35 seasonal position for employment with the same governmental
6.36 employer. Seasonal positions include, but are not limited to,
7.1 coaching athletic activities or employment to plow snow or to
7.2 maintain roads or parks, or to operate skating rinks, ski
7.3 lodges, golf courses, or swimming pools.
7.4 Sec. 4. Minnesota Statutes 2002, section 354.05,
7.5 subdivision 2, is amended to read:
7.6 Subd. 2. TEACHER. (a) "Teacher" means:
7.7 (1) a person who renders service as a teacher, supervisor,
7.8 principal, superintendent, librarian, nurse, counselor, social
7.9 worker, therapist, or psychologist in a public school of the
7.10 state located outside of the corporate limits of a city of the
7.11 first class, or in any charter school, irrespective of the
7.12 location of the school, or in any charitable, penal, or
7.13 correctional institutions of a governmental subdivision, or who
7.14 is engaged in educational administration in connection with the
7.15 state public school system, but excluding the University of
7.16 Minnesota, whether the position be a public office or an
7.17 employment, not including the members or officers of any general
7.18 governing or managing board or body;
7.19 (2) an employee of the teachers retirement association;
7.20 (3) a person who renders teaching service on a part-time
7.21 basis and who also renders other services for a single employing
7.22 unit. A person whose teaching service comprises at least 50
7.23 percent of the combined employment salary is a member of the
7.24 association for all services with the single employing unit. If
7.25 the person's teaching service comprises less than 50 percent of
7.26 the combined employment salary, the executive director must
7.27 determine whether all or none of the combined service is covered
7.28 by the association; or
7.29 (4) a person who is not covered by the plans established
7.30 under chapter 352D, 354A, or 354B and who is employed by the
7.31 board of trustees of the Minnesota state colleges and
7.32 universities system in an unclassified position as:
7.33 (i) a president, vice-president, or dean;
7.34 (ii) a manager or a professional in an academic or an
7.35 academic support program other than specified in item (i);
7.36 (iii) an administrative or a service support faculty
8.1 position; or
8.2 (iv) a teacher or a research assistant.
8.3 (b) "Teacher" does not mean:
8.4 (1) a person who works for a school or institution as an
8.5 independent contractor as defined by the Internal Revenue
8.6 Service;
8.7 (2) a person employed in subsidized on-the-job training,
8.8 work experience or public service employment as an enrollee
8.9 under the federal Comprehensive Employment and Training Act from
8.10 and after March 30, 1978, unless the person has, as of the later
8.11 of March 30, 1978, or the date of employment, sufficient service
8.12 credit in the retirement association to meet the minimum vesting
8.13 requirements for a deferred retirement annuity, or the employer
8.14 agrees in writing on forms prescribed by the executive director
8.15 to make the required employer contributions, including any
8.16 employer additional contributions, on account of that person
8.17 from revenue sources other than funds provided under the federal
8.18 Comprehensive Training and Employment Act, or the person agrees
8.19 in writing on forms prescribed by the executive director to make
8.20 the required employer contribution in addition to the required
8.21 employee contribution;
8.22 (3) a person holding a part-time adult supplementary
8.23 technical college license who renders part-time teaching service
8.24 or a customized trainer as defined by the Minnesota state
8.25 colleges and universities system in a technical college if (i)
8.26 the service is incidental to the regular nonteaching occupation
8.27 of the person; and (ii) the applicable technical college
8.28 employer stipulates annually in advance that the part-time
8.29 teaching service or customized training service will not exceed
8.30 300 hours in a fiscal year and retains the stipulation in its
8.31 records; and (iii) the part-time teaching service or customized
8.32 training service actually does not exceed 300 hours in a fiscal
8.33 year; or
8.34 (4) (3) a person exempt from licensure under section
8.35 122A.30.
8.36 Sec. 5. Minnesota Statutes 2002, section 354B.20,
9.1 subdivision 4, is amended to read:
9.2 Subd. 4. COVERED EMPLOYMENT. (a) "Covered employment"
9.3 means employment by a person eligible for coverage by this
9.4 retirement program under section 354B.21 in a faculty position
9.5 or in an eligible unclassified administrative position.
9.6 (b) "Covered employment" does not mean employment specified
9.7 in paragraph (a) by a faculty member employed in a state
9.8 university or a community college the Minnesota state colleges
9.9 and universities system if the person's initial appointment is
9.10 specified as constituting less than 25 percent of a full
9.11 academic year, exclusive of summer session, for the applicable
9.12 institution.
9.13 Sec. 6. Minnesota Statutes 2002, section 354B.20,
9.14 subdivision 6, is amended to read:
9.15 Subd. 6. ELIGIBLE UNCLASSIFIED ADMINISTRATIVE POSITION.
9.16 "Eligible unclassified administrative position" means the
9.17 following:
9.18 (1) the chancellor of the board;
9.19 (2) a president of a state college or university; or
9.20 (3) an excluded administrator employed in a state
9.21 university or college, by the board, or by the higher education
9.22 services office; or
9.23 (4) other managers and professionals in academic and
9.24 academic support programs in the unclassified service employed
9.25 in a state university or college, by the board, or by the higher
9.26 education services office.
9.27 Sec. 7. Minnesota Statutes 2002, section 354C.11,
9.28 subdivision 2, is amended to read:
9.29 Subd. 2. ELIGIBILITY. (a) An individual must participate
9.30 in the supplemental retirement plan if the individual is
9.31 employed by the board of trustees in the unclassified service of
9.32 the state and has completed at least two years with a full-time
9.33 contract of applicable unclassified employment with the board or
9.34 an applicable predecessor board in any of the positions
9.35 specified in paragraph (b).
9.36 (b) Eligible positions or employment classifications are:
10.1 (1) an unclassified administrative position as defined in
10.2 section 354B.20, subdivision 6;
10.3 (2) an employment classification included in one of the
10.4 following collective bargaining units under section 179A.10,
10.5 subdivision 2:
10.6 (i) the state university instructional unit;
10.7 (ii) the state college instructional unit; and
10.8 (iii) the state university administrative unit; or
10.9 (3) an unclassified employee of the board:
10.10 (i) included in the general professional unit or
10.11 supervisory employees unit under section 179A.10, subdivision 2;
10.12 or
10.13 (ii) excluded from those units due to the employee's
10.14 confidential status under section 179A.10, subdivision 1, clause
10.15 (8).
10.16 Sec. 8. REPEALER.
10.17 Minnesota Statutes 2002, section 352D.02, subdivision 5, is
10.18 repealed.
10.19 Sec. 9. EFFECTIVE DATE.
10.20 (a) Sections 1 to 5 and 8 are effective on July 1, 2004.
10.21 (b) Section 6 is effective on July 1, 2004, and applies
10.22 retroactively to the date of hire of the applicable person in
10.23 the affected position.
10.24 (c) Section 7 is effective retroactively to July 1, 2001.
10.25 ARTICLE 2
10.26 COVERED SALARY DEFINITION
10.27 Section 1. Minnesota Statutes 2002, section 352.01,
10.28 subdivision 13, is amended to read:
10.29 Subd. 13. SALARY. (a) "Salary" means wages, or other
10.30 periodic compensation, paid to an employee before deductions for
10.31 deferred compensation, supplemental retirement plans, or other
10.32 voluntary salary reduction programs.
10.33 (b) "Salary" does not include:
10.34 (1) lump sum sick leave payments,;
10.35 (2) severance payments,;
10.36 (3) lump sum annual leave payments and overtime payments
11.1 made at the time of separation from state service,;
11.2 (4) payments in lieu of any employer-paid group insurance
11.3 coverage, including the difference between single and family
11.4 rates that may be paid to an employee with single coverage, and;
11.5 (5) payments made as an employer-paid fringe benefit,;
11.6 (6) workers' compensation payments,;
11.7 (7) employer contributions to a deferred compensation or
11.8 tax sheltered annuity program,; and
11.9 (8) amounts contributed under a benevolent vacation and
11.10 sick leave donation program are not salary.
11.11 (c) Amounts provided to an employee by the employer through
11.12 a grievance proceeding or a legal settlement are salary only if
11.13 the settlement is reviewed by the executive director and the
11.14 amounts are determined by the executive director to be
11.15 consistent with paragraph (a) and prior determinations.
11.16 Sec. 2. Minnesota Statutes 2002, section 352B.01,
11.17 subdivision 11, is amended to read:
11.18 Subd. 11. AVERAGE MONTHLY SALARY. (a) "Average monthly
11.19 salary" means the average of the highest monthly salaries for
11.20 five years of service as a member upon which contributions were
11.21 deducted from pay under section 352B.02, or upon which
11.22 appropriate contributions or payments were made to the fund to
11.23 receive allowable service and salary credit as specified under
11.24 applicable law. Average monthly salary must be based upon all
11.25 allowable service if this service is less than five years. It
11.26 (b) "Average monthly salary" means the salary of the member
11.27 as defined in section 352.01, subdivision 13. "Average monthly
11.28 salary" does not include any lump-sum annual leave payments and
11.29 overtime payments made at the time of separation from state
11.30 service, any amounts of severance pay, or any reduced salary
11.31 paid during the period the person is entitled to workers'
11.32 compensation benefit payments for temporary disability.
11.33 (c) A member on leave of absence receiving temporary
11.34 workers' compensation payments and a reduced salary or no salary
11.35 from the employer who is entitled to allowable service credit
11.36 for the period of absence may make payment to the fund for the
12.1 difference between salary received, if any, and the salary the
12.2 member would normally receive if not on leave of absence during
12.3 the period. The member shall pay an amount equal to the member
12.4 and employer contribution rate under section 352B.02,
12.5 subdivisions 1b and 1c, on the differential salary amount for
12.6 the period of the leave of absence. The employing department,
12.7 at its option, may pay the employer amount on behalf of the
12.8 member. Payment made under this subdivision must include
12.9 interest at the rate of 8.5 percent per year, and must be
12.10 completed within one year of the return from the leave of
12.11 absence.
12.12 Sec. 3. Minnesota Statutes 2002, section 353.01,
12.13 subdivision 10, is amended to read:
12.14 Subd. 10. SALARY. (a) "Salary" means:
12.15 (1) periodic compensation of a public employee, before
12.16 deductions for deferred compensation, supplemental retirement
12.17 plans, or other voluntary salary reduction programs, and also
12.18 means "wages" and includes net income from fees; and
12.19 (2) for a public employee who has prior service covered by
12.20 a local police or firefighters relief association that has
12.21 consolidated with the public employees retirement association or
12.22 to which section 353.665 applies and who has elected coverage
12.23 either under the public employees police and fire fund benefit
12.24 plan under section 353A.08 following the consolidation or under
12.25 section 353.665, subdivision 4, "salary" means the rate of
12.26 salary upon which member contributions to the special fund of
12.27 the relief association were made prior to the effective date of
12.28 the consolidation as specified by law and by bylaw provisions
12.29 governing the relief association on the date of the initiation
12.30 of the consolidation procedure and the actual periodic
12.31 compensation of the public employee after the effective date of
12.32 consolidation.
12.33 (b) Salary does not mean:
12.34 (1) fees paid to district court reporters, unused annual
12.35 vacation or sick leave payments, in lump-sum or periodic
12.36 payments, severance payments, reimbursement of expenses,
13.1 lump-sum settlements not attached to a specific earnings period,
13.2 or workers' compensation payments;
13.3 (2) employer-paid amounts used by an employee toward the
13.4 cost of insurance coverage, employer-paid fringe benefits,
13.5 flexible spending accounts, cafeteria plans, health care expense
13.6 accounts, day care expenses, or any payments in lieu of any
13.7 employer-paid group insurance coverage, including the difference
13.8 between single and family rates that may be paid to a member
13.9 with single coverage and certain amounts determined by the
13.10 executive director to be ineligible;
13.11 (3) the amount equal to that which the employing
13.12 governmental subdivision would otherwise pay toward single or
13.13 family insurance coverage for a covered employee when, through a
13.14 contract or agreement with some but not all employees, the
13.15 employer:
13.16 (i) discontinues, or for new hires does not provide,
13.17 payment toward the cost of the employee's selected insurance
13.18 coverages under a group plan offered by the employer;
13.19 (ii) makes the employee solely responsible for all
13.20 contributions toward the cost of the employee's selected
13.21 insurance coverages under a group plan offered by the employer,
13.22 including any amount the employer makes toward other employees'
13.23 selected insurance coverages under a group plan offered by the
13.24 employer; and
13.25 (iii) provides increased salary rates for employees who do
13.26 not have any employer-paid group insurance coverages; and
13.27 (4) except as provided in section 353.86 or 353.87,
13.28 compensation of any kind paid to volunteer ambulance service
13.29 personnel or volunteer firefighters, as defined in subdivision
13.30 35 or 36; and
13.31 (5) compensation that exceeds the limitation provided in
13.32 section 356.611.
13.33 Sec. 4. Minnesota Statutes 2002, section 356.611,
13.34 subdivision 2, is amended to read:
13.35 Subd. 2. FEDERAL COMPENSATION LIMITS. (a) For members
13.36 first contributing to of a covered pension plan enumerated in
14.1 section 356.30, subdivision 3, on or after July 1, 1995,
14.2 compensation in excess of the limitation set forth specified in
14.3 section 401(a)(17) of the Internal Revenue Code, as amended, for
14.4 changes in the cost of living under section 401(a)(17)(B) of the
14.5 Internal Revenue Code, may not be included for contribution and
14.6 benefit computation purposes.
14.7 (b) Notwithstanding paragraph (a), for members specified in
14.8 paragraph (a) who first contributed to a covered plan before
14.9 July 1, 1995, the annual compensation limit set forth specified
14.10 in Internal Revenue Code 401(a)(17) on June 30, 1993, applies to
14.11 members first contributing before July 1, 1995 if that provides
14.12 a greater allowable annual compensation.
14.13 Sec. 5. Minnesota Statutes 2002, section 356.611, is
14.14 amended by adding a subdivision to read:
14.15 Subd. 3. MAXIMUM BENEFIT LIMITATIONS. A member's annual
14.16 benefit shall, if necessary, be reduced to the extent required
14.17 by section 415(b) of the Internal Revenue Code, as adjusted by
14.18 the United States Secretary of the Treasury under section 415(d)
14.19 of the Internal Revenue Code. For purposes of section 415 of
14.20 the Internal Revenue Code, the limitation year of a pension plan
14.21 covered by this section shall be the fiscal year or calendar
14.22 year of that plan, whichever is applicable. The accrued benefit
14.23 limitation described in section 415(e) of the Internal Revenue
14.24 Code shall cease to be effective for limitation years beginning
14.25 after December 31, 1999.
14.26 Sec. 6. EFFECTIVE DATE.
14.27 Sections 1 to 5 are effective on July 1, 2004.
14.28 ARTICLE 3
14.29 ALLOWABLE SERVICE CREDIT
14.30 Section 1. Minnesota Statutes 2002, section 354.091, is
14.31 amended to read:
14.32 354.091 SERVICE CREDIT.
14.33 (a) In computing service credit, no teacher shall receive
14.34 credit for more than one year of teaching service for any fiscal
14.35 year. Commencing July 1, 1961:
14.36 (1) if a teacher teaches less than five hours in a day,
15.1 service credit must be given for the fractional part of the day
15.2 as the term of service performed bears to five hours;
15.3 (2) if a teacher teaches five or more hours in a day,
15.4 service credit must be given for only one day;
15.5 (3) if a teacher teaches at least 170 full days in any
15.6 fiscal year, service credit must be given for a full year of
15.7 teaching service; and
15.8 (4) if a teacher teaches for only a fractional part of the
15.9 year, service credit must be given for such fractional part of
15.10 the year as the period of service performed bears to 170 days.
15.11 (b) A teacher shall receive a full year of service credit
15.12 based on the number of days in the employer's full school year
15.13 if it is less than 170 days. Teaching service performed before
15.14 July 1, 1961, must be computed under the law in effect at the
15.15 time it was performed.
15.16 (c) A teacher does not lose or gain retirement service
15.17 credit as a result of the employer converting to a flexible or
15.18 alternate work schedule. If the employer converts to a flexible
15.19 or alternate work schedule, the forms for reporting and the
15.20 procedures for determining service credit must be determined by
15.21 the executive director with the approval of the board of
15.22 trustees.
15.23 (d) For all services rendered on or after July 1, 2003,
15.24 service credit for all members employed by the Minnesota state
15.25 colleges and universities system must be determined:
15.26 (1) for full-time employees, by the definition of full time
15.27 employment contained in the collective bargaining agreement for
15.28 those units listed in section 179A.10, subdivision 2, or
15.29 contained in the applicable personnel or salary plan for those
15.30 positions designated in section 179A.10, subdivision 1;
15.31 (2) for part-time employees, by the appropriate proration
15.32 of full-time equivalency based on the provisions contained in
15.33 the collective bargaining agreement for those units listed in
15.34 section 179A.10, subdivision 2, or contained in the applicable
15.35 personnel or salary plan for those positions designated in
15.36 section 179A.10, subdivision 1, and the applicable procedures of
16.1 the Minnesota state colleges and universities system; and
16.2 (3) in no case may a member receive more than one year of
16.3 service credit for any fiscal year.
16.4 Sec. 2. Minnesota Statutes 2002, section 354.096,
16.5 subdivision 1, is amended to read:
16.6 Subdivision 1. CERTIFICATION. Upon granting a family
16.7 leave to a member, an employing unit must certify the leave to
16.8 the association on a form specified by the executive director
16.9 before the end of the fiscal year during which the leave was
16.10 granted.
16.11 Sec. 3. Minnesota Statutes 2002, section 354.53, is
16.12 amended to read:
16.13 354.53 CREDIT FOR MILITARY BREAK IN SERVICE LEAVE OF
16.14 ABSENCE TO PROVIDE UNIFORMED SERVICE.
16.15 Subdivision 1. ELIGIBILITY; EMPLOYEE AND EMPLOYER
16.16 CONTRIBUTIONS. (a) Any employee given a leave of absence to
16.17 enter military service teacher who is absent from employment by
16.18 reason of service in the uniformed services, as defined in
16.19 United States Code, title 38, section 4303(13), and who returns
16.20 to the employer providing teaching service upon discharge from
16.21 military service as provided in the uniformed service within the
16.22 time frames required in United States Code, title 38, section
16.23 192.262 4312(e), may obtain service credit for the period of
16.24 military the uniformed service but shall not receive credit for
16.25 any voluntary extension of military service at the instance of
16.26 the member beyond the initial period of enlistment, induction or
16.27 call to active duty as further specified in this section,
16.28 provided that the teacher did not separate from uniformed
16.29 service with a dishonorable or bad conduct discharge or under
16.30 other than honorable conditions.
16.31 (b) The member shall may obtain credit by paying into the
16.32 fund an equivalent employee contribution based upon the
16.33 contribution rate or rates in effect at the time that
16.34 the military uniformed service was performed multiplied by the
16.35 full and fractional years, being purchased and applied to the
16.36 annual salary rate of the member for the year beginning with the
17.1 date of return from military service and the number of years of
17.2 military service together with interest thereon at an annual
17.3 rate of 8.5 percent compounded annually from the time the
17.4 military service was rendered to the first date of payment. The
17.5 annual salary rate is the average annual salary during the
17.6 purchase period that the teacher would have received if the
17.7 teacher had continued to provide teaching service to the
17.8 employer rather than provide uniformed service, or if the
17.9 determination of that rate is not reasonably certain, the annual
17.10 salary rate is the teacher's average salary rate during the
17.11 12-month period immediately preceding the period, or, if the
17.12 preceding period is less than 12 months, the annualized rate
17.13 derived from the teacher's average salary rate during the period
17.14 of teacher employment immediately preceding the period of
17.15 uniformed service.
17.16 (c) The equivalent employer contribution and, if
17.17 applicable, the equivalent additional contribution provided in
17.18 section 354.42 must be paid by the employing unit at as provided
17.19 in section 354.52, subdivision 4, using the employer and
17.20 employer additional contribution rate or rates in effect at the
17.21 time that the military uniformed service was performed, applied
17.22 to the same annual salary rate of or rates used to compute the
17.23 member for the year beginning with the date of return from
17.24 military service, in the manner provided in section 354.52,
17.25 subdivision 4 equivalent employee contribution.
17.26 Subd. 2. CALCULATION OF CREDIT. (a) For purposes of
17.27 computing a money purchase annuity under section 354.44,
17.28 subdivision 2 money purchase annuity, all payments into the fund
17.29 pursuant to under this section shall must be considered
17.30 accumulations after July 1, 1957 for the purpose of computing
17.31 any annuity in accordance with section 354.44, subdivision 2.
17.32 (b) For purposes of computing a formula annuity under
17.33 section 354.44, subdivision 6, if the employee equivalent
17.34 contributions and interest thereon provided in this section are
17.35 not paid in full, the member's formula service credit shall must
17.36 be calculated prorated by multiplying the full and fractional
18.1 number of years of military uniformed service eligible for
18.2 purchase by the ratio obtained by dividing the total amount paid
18.3 and employee contribution received by the maximum amount payable
18.4 provided herein total employee contribution otherwise required
18.5 under this section.
18.6 Subd. 3. PAYMENTS ELIGIBLE PAYMENT PERIOD. Payments
18.7 pursuant to this (a) To receive service credit under this
18.8 section, the contributions specified in this section shall must
18.9 be made within transmitted to the teachers retirement
18.10 association during the period which begins with the date the
18.11 individual returns to teaching service and which has a duration
18.12 of three times the length of the uniformed service period, but
18.13 not to exceed five years from the date of discharge.
18.14 (b) Notwithstanding paragraph (a), if the payment period
18.15 determined under paragraph (a) is less than one year, the
18.16 contributions required under this section to receive service
18.17 credit may be made within one year from the discharge date.
18.18 Subd. 4. LIMITS ON SERVICE CREDIT. The amount of service
18.19 credit obtainable under this section may not exceed five years,
18.20 unless a longer purchase period is required under United States
18.21 Code, title 38, section 4312.
18.22 Subd. 5. INTEREST REQUIREMENTS. The employer shall pay
18.23 interest on all equivalent employee and employer contribution
18.24 amounts payable under this section. Interest must be computed
18.25 at a rate of 8.5 percent compounded annually from the end of
18.26 each fiscal year of the leave or break in service to the end of
18.27 the month in which payment is received.
18.28 Sec. 4. Minnesota Statutes 2002, section 354A.093, is
18.29 amended to read:
18.30 354A.093 MILITARY BREAK IN SERVICE CREDIT TO PROVIDE
18.31 UNIFORMED SERVICE.
18.32 Subdivision 1. ELIGIBILITY. Any teacher in the
18.33 coordinated program of either the Minneapolis teachers
18.34 retirement fund association or the St. Paul teachers retirement
18.35 fund association or any teacher in the new law coordinated
18.36 program of the Duluth teachers retirement fund association who
19.1 is granted a leave absent from employment by reason of absence
19.2 to enter military service in the uniformed services as defined
19.3 in United States Code, title 38, section 4303(13) and who
19.4 returns to the employer providing active teaching service upon
19.5 discharge from military uniformed service as provided in within
19.6 the time frames required under United States Code, title 38,
19.7 section 192.262 4312(e), shall be entitled to may receive
19.8 allowable service credit in the applicable association for all
19.9 or a portion of the period of military uniformed service but,
19.10 provided that the teacher did not for any voluntary extension of
19.11 military separate from uniformed service beyond the initial
19.12 period of enlistment, induction with a dishonorable or call to
19.13 active duty which occurred at the instance of the teacher bad
19.14 conduct discharge or under other than honorable conditions.
19.15 Subd. 2. CONTRIBUTIONS. If the teacher granted the
19.16 military service leave of absence makes the equivalent employee
19.17 contribution for a period of military service leave of absence
19.18 pursuant to service provided to the uniformed services under
19.19 this section, the employing unit shall make an equivalent
19.20 employer contribution on behalf of the teacher to the applicable
19.21 association for the period of the military service leave of
19.22 absence being purchased in the manner described in section
19.23 354A.12, subdivision 2a. The equivalent employee and employer
19.24 contributions shall must be in an amount equal to the employee
19.25 and employer contribution rates in effect for other active
19.26 members of the association covered by the same program applied
19.27 to a salary figure equal to the teacher's average annual salary
19.28 rate at the date of return from military service that the
19.29 teacher would have received if the leave or break in service had
19.30 not occurred, or if the determination of that average salary
19.31 rate is not reasonably certain, on the basis of the teacher's
19.32 average salary rate during the 12-month period immediately
19.33 preceding the period, or, if the preceding period is less than
19.34 12 months, the annualized rate derived from the teacher's
19.35 average salary rate during the period of teacher employment
19.36 immediately preceding the period of uniformed service, with the
20.1 result multiplied by the number of full and fractional years
20.2 constituting the period of service provided to the military
20.3 uniformed service leave of absence which the teacher seeks is
20.4 authorized to purchase under this section. Payment shall
20.5 include interest on the amount payable pursuant to this section
20.6 at the rate of six percent compounded annually from the year the
20.7 military service was rendered to the date of payment.
20.8 Subd. 3. PRORATING. If the payments made by a
20.9 teacher pursuant to under this section are less than an the full
20.10 amount equal to the applicable contribution rate applied to a
20.11 salary figure equal to the teacher's annual salary rate at the
20.12 date of return from military service, multiplied by the number
20.13 of years constituting the period of the military service leave
20.14 of absence determined under subdivision 2, the service credit
20.15 shall must be prorated. The prorated service credit shall must
20.16 be determined by the ratio between the amount of the
20.17 actual equivalent employee payment which was made and the full
20.18 contribution amount payable pursuant to equivalent employee
20.19 payment required under this section. In order to be entitled to
20.20 receive service credit under this section, payment shall be made
20.21 within five years from the date of discharge from military
20.22 service.
20.23 Subd. 4. ELIGIBLE PAYMENT PERIOD. (a) To receive service
20.24 credit under this section, the contributions specified in this
20.25 section must be transmitted to the applicable first class city
20.26 teachers retirement fund association during the period which
20.27 begins with the date the individual returns to teaching service
20.28 and which has a duration of three times the length of the
20.29 uniformed service period, but not to exceed five years.
20.30 (b) Notwithstanding paragraph (a), if the payment period
20.31 determined under paragraph (a) is less than one year, the
20.32 contributions required under this section to receive service
20.33 credit may be made within one year from the discharge date.
20.34 Subd. 5. LIMITS ON SERVICE CREDIT. The amount of service
20.35 credit obtainable under this section may not exceed five years,
20.36 unless a longer purchase period is required under United States
21.1 Code, title 38, section 4312.
21.2 Subd. 6. INTEREST REQUIREMENTS. The employer shall pay
21.3 interest on all equivalent employee and employer contribution
21.4 amounts payable under this section. Interest must be computed
21.5 at a rate of 8.5 percent compounded annually from the end of
21.6 each fiscal year of the leave or break in service to the end of
21.7 the month in which payment is received.
21.8 Sec. 5. EFFECTIVE DATE.
21.9 Sections 1 to 4 are effective on July 1, 2004.
21.10 ARTICLE 4
21.11 QUALIFIED PART-TIME TEACHER PROVISIONS
21.12 Section 1. Minnesota Statutes 2002, section 354.66,
21.13 subdivision 2, is amended to read:
21.14 Subd. 2. QUALIFIED PART-TIME TEACHER PROGRAM
21.15 PARTICIPATION REQUIREMENTS. (a) A teacher in a Minnesota public
21.16 elementary school, a Minnesota secondary school, or the
21.17 Minnesota state colleges and universities system who has three
21.18 years or more of allowable service in the association or three
21.19 years or more of full-time teaching service in Minnesota public
21.20 elementary schools, Minnesota secondary schools, or the
21.21 Minnesota state colleges and universities system, by agreement
21.22 with the board of the employing district or with the authorized
21.23 representative of the board, may be assigned to teaching service
21.24 in a part-time teaching position under subdivision 3. The
21.25 agreement must be executed before October 1 of the school year
21.26 for which the teacher requests to make retirement contributions
21.27 under subdivision 4. A copy of the executed agreement must be
21.28 filed with the executive director of the association. If the
21.29 copy of the executed agreement is filed with the association
21.30 after October 1 of the school year for which the teacher
21.31 requests to make retirement contributions under subdivision 4,
21.32 the employing unit shall pay the fine specified in section
21.33 354.52, subdivision 6, for each calendar day that elapsed since
21.34 the October 1 due date. The association may not accept an
21.35 executed agreement that is received by the association more than
21.36 15 months late. The association may not waive the fine required
22.1 by this section.
22.2 (b) Notwithstanding paragraph (a), if the teacher is also a
22.3 legislator:
22.4 (1) the agreement in paragraph (a) must be executed before
22.5 March 1 of the school year for which the teacher requests to
22.6 make retirement contributions under subdivision 4; and
22.7 (2) fines specified in paragraph (a) apply if the employing
22.8 unit does not file the executed agreement with the executive
22.9 director of the association by March 1.
22.10 Sec. 2. EFFECTIVE DATE.
22.11 Section 1 is effective on July 1, 2004.
22.12 ARTICLE 5
22.13 RETIREMENT PLAN CONTRIBUTIONS AND TRANSFERS
22.14 Section 1. Minnesota Statutes 2002, section 354.42,
22.15 subdivision 7, is amended to read:
22.16 Subd. 7. ERRONEOUS SALARY DEDUCTIONS OR DIRECT PAYMENTS.
22.17 (a) Any deductions taken from the salary of an employee for the
22.18 retirement fund in error shall must be refunded to the employee
22.19 upon the discovery of the error and after the verification of
22.20 the error by the employing unit making the deduction, and. The
22.21 corresponding employer contribution and additional employer
22.22 contribution amounts attributable to the erroneous salary
22.23 deduction must be refunded to the employing unit.
22.24 (b) If salary deductions and employer contributions were
22.25 erroneously transmitted to the retirement fund and should have
22.26 been transmitted to another Minnesota public pension plan, the
22.27 retirement association executive director must transfer these
22.28 salary deductions and employer contributions to the appropriate
22.29 public pension fund without interest. For purposes of this
22.30 paragraph, a Minnesota public pension plan means a plan
22.31 specified in section 356.30, subdivision 3, or the plan governed
22.32 by chapter 354B.
22.33 (c) A potential transfer under paragraph (b) that would
22.34 cause the plan to fail to be a qualified plan under section
22.35 401(a) of the Internal Revenue Code, as amended, must not be
22.36 made by the executive director. Within 30 days after being
23.1 notified by the teachers retirement association of an unmade
23.2 potential transfer under this paragraph, the employer of the
23.3 affected person must transmit an amount representing the
23.4 applicable salary deductions and employer contributions, without
23.5 interest, to the retirement fund of the appropriate Minnesota
23.6 public pension plan fund. The retirement association must
23.7 provide a credit for the amount of the erroneous salary
23.8 deductions and employer contributions against future
23.9 contributions from the employer.
23.10 (d) If a salary warrant or check from which a deduction for
23.11 the retirement fund was taken has been canceled or the amount of
23.12 the warrant or if a check has been returned to the funds of the
23.13 employing unit making the payment, a refund of the amount
23.14 deducted, or any portion of it that is required to adjust the
23.15 salary deductions, shall must be made to the employing unit.
23.16 (d) (e) Any erroneous direct payments of member-paid
23.17 contributions or erroneous salary deductions that were not
23.18 refunded in during the regular payroll cycle processing of an
23.19 employing unit's annual summary report shall must be refunded to
23.20 the member with , plus interest computed using the rate and
23.21 method specified in section 354.49, subdivision 2.
23.22 (f) Any refund under this subdivision that would cause the
23.23 plan to fail to be a qualified plan under section 401(a) of the
23.24 Internal Revenue Code, as amended, may not be refunded and
23.25 instead must be credited against future contributions payable by
23.26 the employer. The employer is responsible for refunding to the
23.27 applicable employee any amount that was erroneously deducted
23.28 from the salary of the employee, with interest as specified in
23.29 paragraph (e).
23.30 Sec. 2. Minnesota Statutes 2002, section 354.51,
23.31 subdivision 5, is amended to read:
23.32 Subd. 5. PAYMENT OF SHORTAGES. (a) Except as provided in
23.33 paragraph (b), in the event that full required member
23.34 contributions are not deducted from the salary of a teacher,
23.35 payment shall must be made as follows:
23.36 (a) (1) Payment of shortages in member deductions on salary
24.1 earned after June 30, 1957, and prior to before July 1, 1981,
24.2 may be made any time prior to before retirement. Payment shall
24.3 must include interest at an annual rate of 8.5 percent
24.4 compounded annually from the end of the fiscal year in which the
24.5 shortage occurred to the end of the month in which payment is
24.6 made and the interest shall must be credited to the fund. If
24.7 payment of a shortage in deductions is not made, the formula
24.8 service credit of the member shall must be prorated pursuant to
24.9 under section 354.05, subdivision 25, clause (3).
24.10 (b) (2) Payment of shortages in member deductions on salary
24.11 earned after June 30, 1981, shall be are the sole obligation of
24.12 the employing unit and shall be are payable by the employing
24.13 unit upon notification by the executive director of the shortage
24.14 with interest at an annual rate of 8.5 percent compounded
24.15 annually from the end of the fiscal year in which the shortage
24.16 occurred to the end of the month in which payment is made and
24.17 the interest shall must be credited to the fund. Effective July
24.18 1, 1986, the employing unit shall also pay the employer
24.19 contributions as specified in section 354.42, subdivisions 3 and
24.20 5 for such the shortages. If the shortage payment is not paid
24.21 by the employing unit within 60 days of notification, the
24.22 executive director shall certify the amount of the shortage
24.23 payment to the applicable county auditor, who shall spread a
24.24 levy in the amount of the shortage payment over the taxable
24.25 property of the taxing district of the employing unit if the
24.26 employing unit is supported by property taxes, or to the
24.27 commissioner of finance, who shall deduct the amount from any
24.28 state aid or appropriation amount applicable to the employing
24.29 unit if the employing unit is not supported by property taxes.
24.30 (c) (3) Payment may not be made for shortages in member
24.31 deductions on salary earned prior to before July 1, 1957, for
24.32 shortages in member deductions on salary paid or payable under
24.33 paragraph (b), or for shortages in member deductions for persons
24.34 employed by the Minnesota state colleges and universities system
24.35 in a faculty position or in an eligible unclassified
24.36 administrative position and whose employment was less than 25
25.1 percent of a full academic year, exclusive of the summer
25.2 session, for the applicable institution that exceeds the most
25.3 recent 36 months.
25.4 (b) For a person who is employed by the Minnesota state
25.5 colleges and universities system in a faculty position or in an
25.6 eligible unclassified administrative position and whose
25.7 employment was less than 25 percent of a full academic year,
25.8 exclusive of the summer session, for the applicable institution,
25.9 upon the person's election under section 354B.21 of retirement
25.10 coverage under this chapter, the shortage in member deductions
25.11 on the salary for employment by the Minnesota state colleges and
25.12 universities system institution of less than 25 percent of a
25.13 full academic year, exclusive of the summer session, for the
25.14 applicable institution for the most recent 36 months and the
25.15 associated employer contributions must be paid by the Minnesota
25.16 state colleges and universities system institution, plus annual
25.17 compound interest at the rate of 8.5 percent from the end of the
25.18 fiscal year in which the shortage occurred to the end of the
25.19 month in which the teachers retirement association coverage
25.20 election is made. If the shortage payment is not made by the
25.21 institution within 60 days of notification, the executive
25.22 director shall certify the amount of the shortage payment to the
25.23 commissioner of finance, who shall deduct the amount from any
25.24 state appropriation to the system. An individual electing
25.25 coverage under this paragraph shall repay the amount of the
25.26 shortage in member deductions, plus interest, through deduction
25.27 from salary or compensation payments within the first year of
25.28 employment after the election under section 354B.21, subject to
25.29 the limitations in section 16D.16. The Minnesota state colleges
25.30 and universities system may use any means available to recover
25.31 amounts which were not recovered through deductions from salary
25.32 or compensation payments. No payment of the shortage in member
25.33 deductions under this paragraph may be made for a period longer
25.34 than the most recent 36 months.
25.35 Sec. 3. Minnesota Statutes 2002, section 354B.23,
25.36 subdivision 1, is amended to read:
26.1 Subdivision 1. MEMBER CONTRIBUTION RATE. (a) Except as
26.2 provided in paragraph (b), The member contribution rate for
26.3 participants in the individual retirement account plan is 4.5
26.4 percent of salary.
26.5 (b) For participants in the individual retirement account
26.6 plan who were otherwise eligible to elect retirement coverage in
26.7 the state unclassified employees retirement program, the member
26.8 contribution rate is the rate specified in section 352D.04,
26.9 subdivision 2, paragraph (a).
26.10 Sec. 4. Minnesota Statutes 2002, section 354B.32, is
26.11 amended to read:
26.12 354B.32 TRANSFER OF FUNDS TO IRAP.
26.13 A participant in the individual retirement account plan
26.14 established in this chapter who has less than ten years of
26.15 allowable service under the teachers retirement association or
26.16 the a teachers retirement fund association, whichever applies,
26.17 may elect to transfer an amount equal to the participant's
26.18 accumulated member contributions to the teachers retirement
26.19 association or the applicable teachers retirement fund
26.20 association, plus compound interest at the rate of six percent
26.21 per annum, to the individual retirement account plan. The
26.22 transfers are irrevocable fund to fund fund-to-fund transfers,
26.23 and, in no event, may the participant receive direct payment of
26.24 the money transferred prior to retirement before the termination
26.25 of employment. If a participant elects the contribution
26.26 transfer, all of the participant's allowable and formula service
26.27 credit in the teachers retirement association or the teachers
26.28 retirement fund association associated with the transferred
26.29 amount is forfeited.
26.30 The executive director of the teachers retirement
26.31 association and the chief administrative officers of the
26.32 teachers retirement fund associations, in cooperation with the
26.33 chancellor of the Minnesota state colleges and universities
26.34 system, shall notify participants who are eligible to transfer
26.35 of their right to transfer and the amount that they are eligible
26.36 to transfer, and shall, upon request, provide forms to implement
27.1 the transfer. The chancellor of the Minnesota state colleges
27.2 and universities system shall assist the teachers retirement
27.3 association and the teachers retirement fund associations in
27.4 developing transfer forms and in implementing the transfers.
27.5 Authority to elect a transfer under this section expires on
27.6 July 1, 2004.
27.7 Sec. 5. EFFECTIVE DATE; RETROACTIVE APPLICATION.
27.8 (a) Section 2 is effective on July 1, 2004.
27.9 (b) Section 2 applies to shortages in member deductions
27.10 that occurred before the effective date of the section.
27.11 (c) Sections 1, 3, and 4 are effective on July 1, 2004.
27.12 ARTICLE 6
27.13 REPORTING AND INFORMATION PROVISION
27.14 Section 1. Minnesota Statutes 2002, section 354.07,
27.15 subdivision 9, is amended to read:
27.16 Subd. 9. INFORMATION DISTRIBUTION. All school districts,
27.17 the Minnesota state colleges and universities, community
27.18 colleges and other employers of members of the association are
27.19 obligated to distribute to their employees ballots for the
27.20 election of members to the board of trustees, pamphlets,
27.21 brochures, documents or any other material containing
27.22 association information which are prepared by the executive
27.23 director or the board and are delivered to the employers for
27.24 distribution.
27.25 Sec. 2. Minnesota Statutes 2002, section 354.52,
27.26 subdivision 4a, is amended to read:
27.27 Subd. 4a. MEMBER DATA REPORTING REQUIREMENTS. (a) An
27.28 employing unit must initially provide the member data specified
27.29 in paragraph (b) or any of that data not previously provided to
27.30 the association for payroll warrants dated after June 30, 1995,
27.31 in a format prescribed by the executive director. An employing
27.32 unit must provide the member data specified in paragraph (b) in
27.33 a format prescribed by the executive director. Data changes and
27.34 the dates of those changes under this subdivision must be
27.35 reported to the association in a format prescribed by the
27.36 executive director on an ongoing basis within 14 calendar days
28.1 after the date of the end of the payroll cycle in which they
28.2 occur. These data changes must be reported with the payroll
28.3 cycle data under subdivision 4b.
28.4 (b) Data on the member includes:
28.5 (1) legal name, address, date of birth, association member
28.6 number, employer-assigned employee number, and social security
28.7 number;
28.8 (2) association status, including, but not limited to,
28.9 basic, coordinated, exempt annuitant, exempt technical college
28.10 teacher, and exempt independent contractor or consultant;
28.11 (3) employment status, including, but not limited to, full
28.12 time, part time, intermittent, substitute, or part-time
28.13 mobility;
28.14 (4) employment position, including, but not limited to,
28.15 teacher, superintendent, principal, administrator, or other;
28.16 (5) employment activity, including, but not limited to,
28.17 hire, termination, resumption of employment, disability, or
28.18 death;
28.19 (6) leaves of absence;
28.20 (7) county district number assigned by the association for
28.21 the employing unit;
28.22 (8) data center identification number, if applicable; and
28.23 (9) gender;
28.24 (10) position code; and
28.25 (11) other information as may be required by the executive
28.26 director.
28.27 Sec. 3. Minnesota Statutes 2002, section 354.52, is
28.28 amended by adding a subdivision to read:
28.29 Subd. 4c. MNSCU SERVICE CREDIT REPORTING. For all
28.30 part-time service rendered on or after July 1, 200, the service
28.31 credit reporting requirement in subdivision 4b for all part-time
28.32 employees of the Minnesota state colleges and universities
28.33 system must be met by the Minnesota state colleges and
28.34 universities system reporting to the association on or before
28.35 July 31 of each year the final calculation of each part-time
28.36 member's service credit for the immediately preceding fiscal
29.1 year based on the employee's assignments for the fiscal year.
29.2 Sec. 4. Minnesota Statutes 2002, section 354.52,
29.3 subdivision 6, is amended to read:
29.4 Subd. 6. NONCOMPLIANCE CONSEQUENCES. An employing unit
29.5 that does not comply with the reporting requirements under this
29.6 section shall subdivision 2a, 4a, or 4b must pay a fine of $5
29.7 per calendar day until the association receives the required
29.8 data.
29.9 Sec. 5. EFFECTIVE DATE.
29.10 Sections 1 to 4 are effective on July 1, 2004.
29.11 ARTICLE 7
29.12 RETIREMENT ANNUITY PROVISIONS
29.13 Section 1. Minnesota Statutes 2002, section 353.37, is
29.14 amended by adding a subdivision to read:
29.15 Subd. 1b. RETIREMENT AGE. For purposes of this section,
29.16 "retirement age" means retirement age as defined in United
29.17 States Code, title 42, section 416(l).
29.18 Sec. 2. Minnesota Statutes 2002, section 353.37,
29.19 subdivision 3, is amended to read:
29.20 Subd. 3. REDUCTION OF ANNUITY. The association shall
29.21 reduce the amount of the annuity as follows:
29.22 (a) for of a person who has not reached normal the
29.23 retirement age, by one-half of the amount in excess of the
29.24 applicable reemployment income maximum under subdivision 1;.
29.25 (b) for a person who has reached normal retirement age, but
29.26 has not reached age 70, one-third of the amount in excess of the
29.27 applicable reemployment income maximum under subdivision 1;
29.28 (c) for a person who has reached age 70, or for salary
29.29 earned through service in an elected office, there is no
29.30 reduction upon reemployment, regardless of income.
29.31 There is no reduction upon reemployment, regardless of income,
29.32 for a person who has reached the retirement age.
29.33 Sec. 3. Minnesota Statutes 2002, section 354.44,
29.34 subdivision 4, is amended to read:
29.35 Subd. 4. RETIREMENT ANNUITY ACCRUAL DATE. (a) An annuity
29.36 payment begins to accrue, providing that the age and service
30.1 requirements under subdivision 1 are satisfied, after the
30.2 termination of teaching service, or after the application for
30.3 retirement has been filed with the board, whichever is later, as
30.4 follows:
30.5 (1) on the 16th day of the month of termination or filing
30.6 if the termination or filing occurs on or before the 15th day of
30.7 the month;
30.8 (2) on the first day of the month following the month of
30.9 termination or filing if the termination or filing occurs on or
30.10 after the 16th day of the month;
30.11 (3) on July 1 for all school principals and other
30.12 administrators who receive a full annual contract salary during
30.13 the fiscal year for performance of a full year's contract
30.14 duties; or
30.15 (4) a later date to be either the first or the 16th day of
30.16 a month occurring within the six-month period immediately
30.17 following the termination of teaching service as specified under
30.18 paragraph (b) by the member.
30.19 (b) If an application for retirement is filed with the
30.20 board during the six-month period that occurs immediately
30.21 following the termination of teaching service, the annuity may
30.22 begin to accrue as if the application for retirement had been
30.23 filed with the board on the date teaching service terminated or
30.24 a later date under paragraph (a), clause (4). An annuity must
30.25 not begin to accrue more than one month before the date of final
30.26 salary receipt.
30.27 Sec. 4. EFFECTIVE DATE.
30.28 Sections 1, 2, and 3 are effective on July 1, 2004.
30.29 ARTICLE 8
30.30 DISABILITY BENEFIT PROVISIONS
30.31 Section 1. Minnesota Statutes 2002, section 352.113, is
30.32 amended by adding a subdivision to read:
30.33 Subd. 7a. TEMPORARY REEMPLOYMENT BENEFIT REDUCTION
30.34 WAIVER. A reduction in benefits under subdivision 7, or a
30.35 termination of benefits due to the disabled employee resuming a
30.36 gainful occupation from which earnings are equal to or more than
31.1 the employee's salary at the date of disability or the salary
31.2 currently paid for similar positions does not apply until six
31.3 months after the individual returns to a gainful occupation.
31.4 Sec. 2. Minnesota Statutes 2002, section 352.95,
31.5 subdivision 1, is amended to read:
31.6 Subdivision 1. JOB-RELATED DISABILITY. A covered
31.7 correctional employee who becomes disabled and who is expected
31.8 to be physically or mentally unfit to perform the duties of the
31.9 position for at least one year as a direct result of an injury,
31.10 sickness, or other disability that incurred in or arising arose
31.11 out of any act of duty that makes the employee physically or
31.12 mentally unable to perform the duties, is entitled to a
31.13 disability benefit. The disability benefit may be based on
31.14 covered correctional service only. The benefit amount must
31.15 equal is 50 percent of the average salary defined in section
31.16 352.93, plus an additional percent equal to that specified in
31.17 section 356.315, subdivision 5, for each year of covered
31.18 correctional service in excess of 20 years, ten months, prorated
31.19 for completed months.
31.20 Sec. 3. Minnesota Statutes 2002, section 352.95,
31.21 subdivision 2, is amended to read:
31.22 Subd. 2. NON-JOB-RELATED DISABILITY. Any A covered
31.23 correctional employee who, after rendering at least one year of
31.24 covered correctional service, becomes disabled and who is
31.25 expected to be physically or mentally unfit to perform the
31.26 duties of the position for at least one year because of sickness
31.27 or injury occurring that occurred while not engaged in covered
31.28 employment, is entitled to a disability benefit based on covered
31.29 correctional service only. The disability benefit must be
31.30 computed as provided in section 352.93, subdivisions 1 and 2,
31.31 and must be computed as though the employee had at least 15
31.32 years of covered correctional service.
31.33 Sec. 4. Minnesota Statutes 2002, section 352.95,
31.34 subdivision 4, is amended to read:
31.35 Subd. 4. MEDICAL OR PSYCHOLOGICAL EVIDENCE. (a) An
31.36 applicant shall provide medical or psychological evidence to
32.1 support an application for disability benefits. The director
32.2 shall have the employee examined by at least one additional
32.3 licensed physician or psychologist who is designated by the
32.4 medical adviser. The physicians, or psychologists with respect
32.5 to a mental impairment, shall make written reports to the
32.6 director concerning the question of the employee's disability,
32.7 including medical their expert opinions as to whether the
32.8 employee is disabled within the meaning of this section. The
32.9 director shall also obtain written certification from the
32.10 employer stating whether or not the employee is on sick leave of
32.11 absence because of a disability that will prevent further
32.12 service to the employer, and as a consequence, the employee is
32.13 not entitled to compensation from the employer.
32.14 (b) If, on considering the physicians' or psychologists'
32.15 reports and any other evidence supplied by the employee or
32.16 others, the medical adviser finds the employee disabled within
32.17 the meaning of this section, the advisor shall make appropriate
32.18 recommendation to the director, in writing, together with the
32.19 date from which the employee has been disabled. The director
32.20 shall then determine the propriety of authorizing payment of a
32.21 disability benefit as provided in this section.
32.22 (c) Unless the payment of a disability benefit has
32.23 terminated because the employee is no longer disabled, or
32.24 because the employee has reached either age 65 or the five-year
32.25 anniversary of the effective date of the disability benefit,
32.26 whichever is later, the disability benefit shall must cease with
32.27 the last payment received by the disabled employee or which had
32.28 accrued during the employee's lifetime. While disability
32.29 benefits are paid, the director has the right, at reasonable
32.30 times, to require the disabled employee to submit proof of the
32.31 continuance of the disability claimed. If any examination
32.32 indicates to the medical adviser that the employee is no longer
32.33 disabled, the disability payment must be discontinued upon the
32.34 reinstatement to state service or within 60 days of the finding,
32.35 whichever is sooner.
32.36 Sec. 5. Minnesota Statutes 2002, section 352B.10,
33.1 subdivision 1, is amended to read:
33.2 Subdivision 1. INJURIES,; PAYMENT AMOUNTS. Any A member
33.3 who becomes disabled and who is expected to be physically or
33.4 mentally unfit to perform duties for at least one year as a
33.5 direct result of an injury, sickness, or other disability that
33.6 incurred in or arising arose out of any act of duty, shall is
33.7 entitled to receive disability benefits while disabled. The
33.8 benefits must be paid in monthly installments. The benefit is
33.9 an amount equal to the member's average monthly salary
33.10 multiplied by 60 percent, plus an additional percent equal to
33.11 that specified in section 356.315, subdivision 6, for each year
33.12 and pro rata for completed months of service in excess of 20
33.13 years, if any.
33.14 Sec. 6. Minnesota Statutes 2002, section 352B.10,
33.15 subdivision 2, is amended to read:
33.16 Subd. 2. DISABLED WHILE NOT ON DUTY. If a member
33.17 terminates employment after with at least one year of service
33.18 because of sickness or injury occurring while not on duty and
33.19 not engaged in state work entitling the member to membership,
33.20 and the member becomes disabled and is expected to be physically
33.21 or mentally unfit to perform the duties of the position for at
33.22 least one year because of sickness or injury occurring that
33.23 occurred while not engaged in covered employment, the member
33.24 individual is entitled to disability benefits. The benefit must
33.25 be in the same amount and computed in the same way as if the
33.26 member individual were 55 years old at the date of disability
33.27 and the annuity were paid was payable under section 352B.08. If
33.28 a disability under this clause subdivision occurs after one year
33.29 of service but before 15 years of service, the disability
33.30 benefit must be computed as though the member individual had 15
33.31 years of service.
33.32 Sec. 7. Minnesota Statutes 2002, section 352B.10,
33.33 subdivision 3, is amended to read:
33.34 Subd. 3. ANNUAL AND SICK LEAVE; WORK AT LOWER PAY. No
33.35 member shall is entitled to receive any a disability benefit
33.36 payment when the member has unused annual leave or sick leave,
34.1 or under any other circumstances, when, during the period of
34.2 disability, there has been no impairment of salary. Should If
34.3 the member or former member resume disabilitant resumes gainful
34.4 work employment, the disability benefit must be continued in an
34.5 amount which, when added to current earnings, does not exceed
34.6 the salary rate received of by the person at the date of
34.7 disability as, which must be adjusted over time by the same
34.8 percentage increase in United States average wages used by the
34.9 social security administration in calculating average indexed
34.10 monthly earnings for the old age, survivors, and disability
34.11 insurance programs for the same period.
34.12 Sec. 8. Minnesota Statutes 2002, section 352B.10,
34.13 subdivision 4, is amended to read:
34.14 Subd. 4. PROOF OF DISABILITY. No disability benefit
34.15 payment shall benefits may be made except upon paid unless
34.16 adequate proof is furnished to the executive director of the
34.17 existence of the disability. While disability benefits are
34.18 being paid Following the commencement of benefit payments,
34.19 the executive director has the right, at reasonable times, to
34.20 require the disabled former member disabilitant to submit proof
34.21 of the continuance of the disability claimed.
34.22 Sec. 9. Minnesota Statutes 2002, section 352B.10,
34.23 subdivision 5, is amended to read:
34.24 Subd. 5. OPTIONAL ANNUITY. A disabled member
34.25 disabilitant may, in lieu of survivorship coverage under section
34.26 352B.11, subdivision 2, choose the normal disability benefit or
34.27 an optional annuity as provided in section 352B.08, subdivision
34.28 3. The choice of an optional annuity must be made in writing,
34.29 on a form prescribed by the executive director, and must be made
34.30 before the commencement of the payment of the disability
34.31 benefit, or within 90 days of attaining before reaching age 65
34.32 or before reaching the five-year anniversary of the effective
34.33 date of the disability benefit, whichever is later. It The
34.34 optional annuity is effective on the date on which the
34.35 disability benefit begins to accrue, or the month following the
34.36 attainment of age 65 or following the five-year anniversary of
35.1 the effective date of the disability benefit, whichever is later.
35.2 Sec. 10. Minnesota Statutes 2002, section 352B.105, is
35.3 amended to read:
35.4 352B.105 TERMINATION OF DISABILITY BENEFITS.
35.5 Disability benefits payable under section 352B.10 shall
35.6 must terminate at on the transfer date, which is the end of the
35.7 month in which the beneficiary disabilitant becomes 65 years old
35.8 or the five-year anniversary of the effective date of the
35.9 disability benefit, whichever is later. If the beneficiary
35.10 disabilitant is still disabled when on the beneficiary becomes
35.11 65 years old transfer date, the beneficiary shall disabilitant
35.12 must be deemed to be a retired member and, if the beneficiary
35.13 disabilitant had chosen an optional annuity under section
35.14 352B.10, subdivision 5, shall must receive an annuity in
35.15 accordance with under the terms of the optional annuity
35.16 previously chosen. If the beneficiary disabilitant had not
35.17 chosen an optional annuity under section 352B.10, subdivision 5,
35.18 the beneficiary disabilitant may then choose to receive either a
35.19 normal retirement annuity computed under section 352B.08,
35.20 subdivision 2, or an optional annuity as provided in section
35.21 352B.08, subdivision 3. An optional annuity must be chosen
35.22 within 90 days of attaining age 65 or reaching the five-year
35.23 anniversary of the effective date of the disability benefit,
35.24 whichever is later transfer date. If an optional annuity is
35.25 chosen, the optional annuity shall begin to accrue accrues on
35.26 the first of the month next following attainment of age 65 or
35.27 the five-year anniversary of the effective transfer date of the
35.28 disability benefit, whichever is later.
35.29 Sec. 11. Minnesota Statutes 2002, section 352D.065,
35.30 subdivision 2, is amended to read:
35.31 Subd. 2. DISABILITY BENEFIT AMOUNT. A participant who
35.32 becomes totally and permanently disabled has the option, even if
35.33 on leave of absence without pay, to receive:
35.34 (1) the value of the participant's total shares;
35.35 (2) the value of one-half of a portion of the total shares
35.36 and an annuity based on the value of one-half remainder of the
36.1 total shares; or
36.2 (3) an annuity based on the value of the participant's
36.3 total shares.
36.4 Sec. 12. Minnesota Statutes 2002, section 353.33,
36.5 subdivision 4, is amended to read:
36.6 Subd. 4. PROCEDURE TO DETERMINE ELIGIBILITY. (a) The
36.7 applicant shall provide an expert report signed by a licensed
36.8 physician, psychologist, or chiropractor and the applicant must
36.9 authorize the release of medical and health care evidence,
36.10 including all medical records and relevant information from any
36.11 source, to support the application for total and permanent
36.12 disability benefits.
36.13 (b) The expert report signed by a licensed chiropractor
36.14 augments the report of another expert and may not be the sole
36.15 basis for the granting of a disability benefit.
36.16 (c) The medical adviser shall verify the medical evidence
36.17 and, if necessary for disability determination, suggest the
36.18 referral of the applicant to specialized medical consultants.
36.19 (d) The association shall also obtain from the employer,
36.20 certification of the member's past public service, dates of paid
36.21 sick leave and vacation beyond the last working day and whether
36.22 or not sick leave or annual leave has been allowed.
36.23 (e) If, upon consideration of the medical evidence received
36.24 and the recommendations of the medical adviser, it is determined
36.25 by the executive director that the applicant is totally and
36.26 permanently disabled within the meaning of the law, the
36.27 association shall grant the person a disability benefit. The
36.28 fact that
36.29 (f) An employee who is placed on leave of absence without
36.30 compensation because of disability does is not bar the person
36.31 barred from receiving a disability benefit.
36.32 Sec. 13. Minnesota Statutes 2002, section 353.33,
36.33 subdivision 6, is amended to read:
36.34 Subd. 6. CONTINUING ELIGIBILITY FOR BENEFITS. The
36.35 association shall determine eligibility for continuation of
36.36 disability benefits and require periodic examinations and
37.1 evaluations of disabled members as frequently as deemed
37.2 necessary. The association shall require the disabled member to
37.3 provide an expert report signed by a licensed physician,
37.4 psychologist, or chiropractor and the disabled member shall
37.5 authorize the release of medical and health care evidence,
37.6 including all medical and health care records and information
37.7 from any source, relating to an application for continuation of
37.8 disability benefits. The expert report signed by a licensed
37.9 chiropractor augments the report of another expert and may not
37.10 be the sole basis for continuing a disability benefit.
37.11 Disability benefits are contingent upon a disabled person's
37.12 participation in a vocational rehabilitation program evaluation
37.13 if the executive director determines that the disabled person
37.14 may be able to return to a gainful occupation. If a member is
37.15 found to be no longer totally and permanently disabled, payments
37.16 must cease the first of the month following the expiration of a
37.17 30-day period after the member receives a certified letter
37.18 notifying the member that payments will cease.
37.19 Sec. 14. Minnesota Statutes 2002, section 353.33,
37.20 subdivision 6b, is amended to read:
37.21 Subd. 6b. DUTIES OF THE MEDICAL ADVISER. At the request
37.22 of the executive director, the medical adviser shall designate
37.23 licensed physicians, psychologists, or chiropractors to examine
37.24 applicants for disability benefits and review the medical expert
37.25 reports based upon these examinations to determine whether an
37.26 applicant is totally and permanently disabled as defined in
37.27 section 353.01, subdivision 19, disabled as defined in section
37.28 353.656, or eligible for continuation of disability benefits
37.29 under subdivision 6. The medical examiner shall also review, at
37.30 the request of the executive director, all medical and health
37.31 care statements on behalf of an applicant for disability
37.32 benefits, and shall report in writing to the executive
37.33 director the conclusions and recommendations of the examiner on
37.34 those matters referred for advice.
37.35 Sec. 15. Minnesota Statutes 2002, section 353.33,
37.36 subdivision 7, is amended to read:
38.1 Subd. 7. PARTIAL REEMPLOYMENT. If, following a work or
38.2 non-work-related injury or illness, a disabled person resumes a
38.3 gainful occupation from which who remains totally and
38.4 permanently disabled as defined in section 353.01, subdivision
38.5 19, has income from employment that is not substantial gainful
38.6 activity and the rate of earnings from that employment are less
38.7 than the salary rate at the date of disability or the
38.8 salary rate currently paid for similar positions similar to the
38.9 employment position held by the disabled person immediately
38.10 before becoming disabled, whichever is greater, the board
38.11 executive director shall continue the disability benefit in an
38.12 amount that, when added to the earnings and any workers'
38.13 compensation benefit, does not exceed the salary rate at the
38.14 date of disability or the salary currently paid for similar
38.15 positions similar to the employment position held by the
38.16 disabled person immediately before becoming disabled, whichever
38.17 is higher, provided. The disability benefit does under this
38.18 subdivision may not exceed the disability benefit originally
38.19 allowed, plus any postretirement adjustments payable after
38.20 December 31, 1988, in accordance with section 11A.18,
38.21 subdivision 10. No deductions for the retirement fund may be
38.22 taken from the salary of a disabled person who is receiving a
38.23 disability benefit as provided in this subdivision.
38.24 Sec. 16. Minnesota Statutes 2002, section 354.48,
38.25 subdivision 2, is amended to read:
38.26 Subd. 2. APPLICATIONS; ACCRUAL. (a) A person described
38.27 in subdivision 1, or another person authorized to act on behalf
38.28 of the person, may make written application on a form prescribed
38.29 by the executive director for a total and permanent disability
38.30 benefit only within the 18-month period following the
38.31 termination of teaching service. This
38.32 (b) The benefit accrues from the day following the
38.33 commencement of the disability or the day following the last day
38.34 for which salary is paid, whichever is later, but does not begin
38.35 to accrue more than six months before the date on which the
38.36 written application is filed with the executive director. If
39.1 salary is being received for either annual or sick leave during
39.2 the disability period, payments accrue the disability benefit
39.3 accrues from the day following the last day for which this
39.4 salary is paid.
39.5 Sec. 17. Minnesota Statutes 2002, section 354.48,
39.6 subdivision 4, is amended to read:
39.7 Subd. 4. DETERMINATION BY THE EXECUTIVE DIRECTOR. The
39.8 executive director shall have the member examined by at least
39.9 two licensed physicians or licensed psychologists selected by
39.10 the medical adviser. These physicians, or psychologists with
39.11 respect to a mental impairment, shall make written reports to
39.12 the executive director concerning the member's disability,
39.13 including medical expert opinions as to whether or not the
39.14 member is permanently and totally disabled within the meaning of
39.15 section 354.05, subdivision 14. The executive director shall
39.16 also obtain written certification from the last employer stating
39.17 whether or not the member was separated from service because of
39.18 a disability which would reasonably prevent further service to
39.19 the employer and as a consequence the member is not entitled to
39.20 compensation from the employer. If, upon the consideration of
39.21 the reports of the physicians or psychologists and any other
39.22 evidence presented by the member or by others interested
39.23 therein, the executive director finds that the member is totally
39.24 and permanently disabled, the executive director shall grant the
39.25 member a disability benefit. The fact that An employee who is
39.26 placed on leave of absence without compensation because of
39.27 disability shall is not bar the member barred from receiving a
39.28 disability benefit.
39.29 Sec. 18. Minnesota Statutes 2002, section 354.48,
39.30 subdivision 6, is amended to read:
39.31 Subd. 6. REGULAR PHYSICAL EXAMINATIONS. At least once
39.32 each year during the first five years following the allowance of
39.33 a disability benefit to any member, and at least once in every
39.34 three-year period thereafter, the executive director shall
39.35 require the disability beneficiary to undergo a medical
39.36 examination by a physician or physicians, or by one or more
40.1 psychologists with respect to a mental impairment, engaged by
40.2 the executive director. If any an examination indicates that
40.3 the member is no longer permanently and totally disabled or that
40.4 the member is engaged or is able to engage in a substantial
40.5 gainful occupation, payments of the disability benefit by the
40.6 association shall must be discontinued. The payments shall
40.7 discontinue must be discontinued as soon as the member is
40.8 reinstated to the payroll following sick leave, but payment may
40.9 not be made for more than 60 days after the physicians or
40.10 psychologists engaged by the executive director find that the
40.11 person is no longer permanently and totally disabled.
40.12 Sec. 19. Minnesota Statutes 2002, section 354.48,
40.13 subdivision 6a, is amended to read:
40.14 Subd. 6a. MEDICAL ADVISER; DUTIES. The state
40.15 commissioner of health or a licensed physician on the staff of
40.16 the department of health who is designated by the commissioner
40.17 shall be the medical adviser of the executive director. The
40.18 medical adviser shall designate licensed physicians, or licensed
40.19 psychologists with respect to a mental impairment, who shall
40.20 examine applicants for disability benefits. The medical adviser
40.21 shall pass upon all medical expert reports based on any
40.22 examinations performed in order to determine whether a teacher
40.23 is totally and permanently disabled as defined in section
40.24 354.05, subdivision 14. The medical adviser shall also
40.25 investigate all health and medical statements and certificates
40.26 by or on behalf of a teacher in connection with a disability
40.27 benefit, and shall report in writing to the director setting
40.28 forth any conclusions and recommendations on all matters
40.29 referred to the medical adviser.
40.30 Sec. 20. Minnesota Statutes 2002, section 354A.36,
40.31 subdivision 4, is amended to read:
40.32 Subd. 4. DETERMINATION OF DISABILITY. The board of the
40.33 teachers retirement fund association shall make the final
40.34 determination of the existence of a permanent and total
40.35 disability. The board shall have the coordinated member
40.36 examined by at least two licensed physicians or licensed
41.1 psychologists who shall be are selected by the board. After
41.2 making any required examinations, each physician, or
41.3 psychologist with respect to a mental impairment, shall make a
41.4 written report to the board concerning the coordinated member,
41.5 which shall include a statement of the physician's or
41.6 psychologist's medical expert opinion as to whether or not the
41.7 member is permanently and totally disabled within the meaning of
41.8 section 354A.011, subdivision 14. The board shall also obtain a
41.9 written statement from the school district employer as to
41.10 whether or not the coordinated member was terminated or
41.11 separated from active employment due to a disability which is
41.12 deemed by the district employer to reasonably prevent further
41.13 service by the member to the district employer and which caused
41.14 the coordinated member not to be entitled to further
41.15 compensation from the district employer for services rendered by
41.16 the member. If, after consideration of the reports of the
41.17 physicians, or psychologists with respect to a mental
41.18 impairment, and any evidence presented by the member or by any
41.19 other interested parties, the board determines that the
41.20 coordinated member is totally and permanently disabled within
41.21 the meaning of section 354A.011, subdivision 14, it shall grant
41.22 the coordinated member a disability benefit. The fact that A
41.23 member has been who is placed on a leave of absence without
41.24 compensation as a result of the disability shall is not operate
41.25 to bar barred a coordinated member from receiving a disability
41.26 benefit under this section.
41.27 Sec. 21. Minnesota Statutes 2002, section 354A.36,
41.28 subdivision 6, is amended to read:
41.29 Subd. 6. REQUIREMENT FOR REGULAR PHYSICAL EXAMINATIONS.
41.30 At least once each year during the first five years following
41.31 the granting of a disability benefit to a coordinated member by
41.32 the board and at least once in every three year period
41.33 thereafter, the board shall require the disability benefit
41.34 recipient to undergo a medical expert examination as a condition
41.35 for continued entitlement of the benefit recipient to receive a
41.36 disability benefit. The medical expert examination shall must
42.1 be made at the place of residence of the disability benefit
42.2 recipient or at any other place mutually agreeable to the
42.3 disability benefit recipient and the board. The medical expert
42.4 examination shall must be made by a physician or physicians or
42.5 by one or more psychologists engaged by the board. The
42.6 physician or physicians, or the psychologist or psychologists
42.7 with respect to a mental impairment, conducting the medical
42.8 expert examination shall make a written report to the board
42.9 concerning the disability benefit recipient and the recipient's
42.10 disability, including a statement of the physician's or
42.11 psychologist's medical expert opinion as to whether or not the
42.12 member remains permanently and totally disabled within the
42.13 meaning of section 354A.011, subdivision 14. If the board
42.14 determines from consideration of the physician's written medical
42.15 expert examination report of the physician or of the
42.16 psychologist with respect to a mental impairment that the
42.17 disability benefit recipient is no longer permanently and
42.18 totally disabled or if the board determines that the benefit
42.19 recipient is engaged or is able to engage in a gainful
42.20 occupation, unless the disability benefit recipient is partially
42.21 employed pursuant to under subdivision 7, then further
42.22 disability benefit payments from the fund shall must be
42.23 discontinued. The discontinuation of disability benefits shall
42.24 must occur immediately if the disability recipient is reinstated
42.25 to the district payroll following sick leave and within 60 days
42.26 of the determination by the board following the medical expert
42.27 examination and report of the physician or physicians or
42.28 psychologist or psychologists engaged by the board that the
42.29 disability benefit recipient is no longer permanently and
42.30 totally disabled within the meaning of section 354A.011,
42.31 subdivision 14.
42.32 Sec. 22. REPEALER.
42.33 (a) Minnesota Statutes 2002, sections 353.33, subdivision
42.34 5b; and 490.11, are repealed on July 1, 2004.
42.35 (b) Section 1 is repealed on July 1, 2006.
42.36 Sec. 23. EFFECTIVE DATE.
43.1 Sections 1 to 22 are effective on July 1, 2004.
43.2 ARTICLE 9
43.3 DEATH AND SURVIVOR BENEFITS AND REFUNDS
43.4 Section 1. Minnesota Statutes 2002, section 3A.03,
43.5 subdivision 2, is amended to read:
43.6 Subd. 2. REFUND. (a) Any A former member who has made
43.7 contributions under subdivision 1 and who is no longer a member
43.8 of the legislature is entitled to receive, upon written
43.9 application to the executive director on a form prescribed by
43.10 the executive director, a refund of all contributions credited
43.11 to the member's account with interest at an annual rate of six
43.12 percent compounded annually computed as provided in section
43.13 352.22, subdivision 2.
43.14 (b) The refund of contributions as provided in paragraph (a)
43.15 terminates all rights of a former member of the legislature or
43.16 and the survivors of the former member under this chapter.
43.17 (c) If the former member of the legislature again becomes a
43.18 member of the legislature after having taken a refund as
43.19 provided in paragraph (a), the member must be considered a new
43.20 member of this plan. However, a new the member may reinstate
43.21 the rights and credit for service previously forfeited if the
43.22 new member repays all refunds taken plus interest at an annual
43.23 rate of 8.5 percent compounded annually from the date on which
43.24 the refund was taken to the date on which the refund is repaid.
43.25 (c) (d) No person may be required to apply for or to accept
43.26 a refund.
43.27 Sec. 2. Minnesota Statutes 2002, section 352.12,
43.28 subdivision 1, is amended to read:
43.29 Subdivision 1. DEATH BEFORE TERMINATION OF SERVICE. If
43.30 an employee dies before state service has terminated and neither
43.31 a survivor annuity nor a reversionary annuity is payable on
43.32 behalf of the employee, or if a former employee who has
43.33 sufficient service credit to be entitled to an annuity dies
43.34 before the benefit annuity has become payable, the director
43.35 shall make a refund with interest is payable upon filing a
43.36 written application on a form prescribed by the executive
44.1 director. The refund is payable to the last designated
44.2 beneficiary or, if there is none, to the surviving spouse or, if
44.3 none, to the employee's surviving children in equal shares or,
44.4 if none, to the employee's surviving parents in equal shares or,
44.5 if none, to the representative of the estate in an amount equal
44.6 to the accumulated employee contributions plus interest at the
44.7 rate of six percent per annum compounded annually. Interest
44.8 must be computed as provided in section 352.22, subdivision 2,
44.9 to the first day of the month in which the refund is processed.
44.10 Upon the death of an employee who has received a refund that was
44.11 later repaid in full, interest must be paid on the repaid refund
44.12 only from the date of the repayment. If the repayment was made
44.13 in installments, interest must be paid only from the date on
44.14 which the installment payments began. The designated
44.15 beneficiary, the surviving spouse, or the representative of the
44.16 estate of an employee who had received a disability benefit is
44.17 not entitled to the payment of interest upon any balance
44.18 remaining to the decedent's credit in the fund at the time of
44.19 death, unless the death occurred before any payment could be
44.20 negotiated.
44.21 Sec. 3. Minnesota Statutes 2002, section 352.12,
44.22 subdivision 6, is amended to read:
44.23 Subd. 6. DEATH AFTER SERVICE TERMINATION. Except as
44.24 provided in subdivision 1, if a former employee covered by the
44.25 system dies and who has not received an annuity, a retirement
44.26 allowance, or a disability benefit dies, a refund must be made
44.27 is payable to the last designated beneficiary or, if there is
44.28 none, to the surviving spouse or, if none, to the employee's
44.29 surviving children in equal shares or, if none, to the
44.30 employee's surviving parents in equal shares or, if none, to the
44.31 representative of the estate in an amount equal to accumulated
44.32 employee contributions plus interest. The refund must include
44.33 interest at the rate of six percent per year compounded
44.34 annually. The interest on the refund must be computed as
44.35 provided in section 352.22, subdivision 2.
44.36 Sec. 4. Minnesota Statutes 2002, section 352.22,
45.1 subdivision 2, is amended to read:
45.2 Subd. 2. AMOUNT OF REFUND. Except as provided in
45.3 subdivision 3, the refund payable to a person who ceased to be a
45.4 state employee by reason of a termination of state service is in
45.5 an amount equal to employee accumulated contributions plus
45.6 interest at the rate of six percent per year compounded annually
45.7 daily from the date that the contribution was made until the
45.8 date on which the refund is paid. Included with the refund is
45.9 any interest paid as part of repayment of a past refund, plus
45.10 interest thereon from the date of repayment. Interest must be
45.11 computed to the first day of the month in which the refund is
45.12 processed and must be based on fiscal year or monthly balances,
45.13 whichever applies.
45.14 Sec. 5. Minnesota Statutes 2002, section 352.22,
45.15 subdivision 3, is amended to read:
45.16 Subd. 3. DEFERRED ANNUITY. (a) An employee who has at
45.17 least three years of allowable service when termination occurs
45.18 may elect to leave the accumulated contributions in the fund and
45.19 thereby be entitled to a deferred retirement annuity. The
45.20 annuity must be computed under the law in effect when state
45.21 service terminated, on the basis of the allowable service
45.22 credited to the person before the termination of service.
45.23 (b) An employee on layoff or on leave of absence without
45.24 pay, except a leave of absence for health reasons, and who does
45.25 not return to state service shall must have an annuity, deferred
45.26 annuity, or other benefit to which the employee may become
45.27 entitled computed under the law in effect on the employee's last
45.28 working day.
45.29 (c) No application for a deferred annuity may be made more
45.30 than 60 days before the time the former employee reaches the
45.31 required age for entitlement to the payment of the annuity. The
45.32 deferred annuity begins to accrue no earlier than 60 days before
45.33 the date the application is filed in the office of the system,
45.34 but not (1) before the date on which the employee reaches the
45.35 required age for entitlement to the annuity nor (2) before the
45.36 day following the termination of state service in a
46.1 position which is not covered by the retirement system.
46.2 (d) Application for the accumulated contributions left on
46.3 deposit with the fund may be made at any time after 30 days
46.4 following the date of the termination of service.
46.5 Sec. 6. Minnesota Statutes 2002, section 352B.10,
46.6 subdivision 5, is amended to read:
46.7 Subd. 5. OPTIONAL ANNUITY. A disabled member
46.8 disabilitant may elect, in lieu of spousal survivorship coverage
46.9 under section 352B.11, subdivision 2 subdivisions 2b and
46.10 2c, choose the normal disability benefit or an optional annuity
46.11 as provided in section 352B.08, subdivision 3. The choice of an
46.12 optional annuity must be made before the commencement of the
46.13 payment of the disability benefit, or within 90 days of
46.14 attaining before reaching age 65 or reaching the five-year
46.15 anniversary of the effective date of the disability benefit,
46.16 whichever is later. It The optional annuity is effective on the
46.17 date on which the disability benefit begins to accrue, or the
46.18 month following attainment of age 65 or the five-year
46.19 anniversary of the effective date of the disability benefit,
46.20 whichever is later.
46.21 Sec. 7. Minnesota Statutes 2002, section 352B.11,
46.22 subdivision 1, is amended to read:
46.23 Subdivision 1. REFUND OF PAYMENTS. (a) A member who has
46.24 not received other benefits under this chapter is entitled to a
46.25 refund of payments made by salary deduction, plus interest, if
46.26 the member is separated, either voluntarily or involuntarily,
46.27 from the state service that entitled the member to membership.
46.28 (b) In the event of the member's death, if there are no
46.29 survivor benefits payable under this chapter, a refund plus
46.30 interest is payable to the last designated beneficiary on a form
46.31 filed with the director before death, or if no designation is
46.32 filed, the refund is payable to the member's estate. Interest
46.33 under this subdivision must be computed at the rate of six
46.34 percent a year, compounded annually calculated as provided in
46.35 section 352.22, subdivision 2. To receive a refund, the
46.36 application must be made on a form prescribed by the executive
47.1 director.
47.2 Sec. 8. Minnesota Statutes 2002, section 352B.11,
47.3 subdivision 2, is amended to read:
47.4 Subd. 2. DEATH; PAYMENT TO SPOUSE AND DEPENDENT CHILDREN;
47.5 FAMILY MAXIMUMS. If a member serving actively as a member, or a
47.6 member or former member receiving the disability benefit before
47.7 attaining age 65 or reaching the five-year anniversary of the
47.8 effective date of the disability benefit, whichever is later,
47.9 provided by section 352B.10, subdivisions 1 and 2, dies from any
47.10 cause before attaining age 65 or reaching the five-year
47.11 anniversary of the effective date of the disability benefit,
47.12 whichever is later, the surviving spouse and dependent children
47.13 are entitled to benefit payments as follows:
47.14 (a) A member with at least three years of allowable service
47.15 is deemed to have elected a 100 percent joint and survivor
47.16 annuity payable to a surviving spouse only on or after the date
47.17 the member or former member became or would have become 55.
47.18 (b) The surviving spouse of a member who had credit for
47.19 less than three years of service shall receive, for life, a
47.20 monthly annuity equal to 50 percent of that part of the average
47.21 monthly salary of the member from which deductions were made for
47.22 retirement.
47.23 (c) The surviving spouse of a member who had credit for at
47.24 least three years service and who died after becoming 55 years
47.25 old, may elect to receive a 100 percent joint and survivor
47.26 annuity, for life, notwithstanding a subsequent remarriage, in
47.27 lieu of the annuity prescribed in paragraph (b).
47.28 (d) The surviving spouse of any member who had credit for
47.29 three years or more and who was not 55 years old at death, shall
47.30 receive the benefit equal to 50 percent of the average monthly
47.31 salary as described in clause (b) until the deceased member
47.32 would have become 55 years old, and beginning the first of the
47.33 month following that date, may elect to receive the 100 percent
47.34 joint and survivor annuity.
47.35 (e) Each dependent child, as defined in section 352B.01,
47.36 subdivision 10, shall receive a monthly annuity equal to ten
48.1 percent of that part of the average monthly salary of the former
48.2 deceased member from which deductions were made for retirement.
48.3 A dependent child over 18 and under 23 years of age also may
48.4 receive the monthly benefit provided in this section, if the
48.5 child is continuously attending an accredited school as a
48.6 full-time student during the normal school year as determined by
48.7 the director. If the child does not continuously attend school
48.8 but separates from full-time attendance during any part of a
48.9 school year, the annuity shall cease at the end of the month of
48.10 separation. In addition, a payment of $20 per month shall be
48.11 prorated equally to surviving dependent children when the former
48.12 member is survived by one or more dependent children. Payments
48.13 for the benefit of any qualified dependent child must be made to
48.14 the surviving spouse, or if there is none, to the legal guardian
48.15 of the child. The maximum monthly benefit for any one family,
48.16 including a surviving spouse benefit, if applicable, must not be
48.17 less than 50 percent nor exceed 70 percent of the average
48.18 monthly salary for any number of children of the deceased member.
48.19 (f) If the member dies under circumstances that entitle the
48.20 surviving spouse and dependent children to receive benefits
48.21 under the workers' compensation law, the workers' compensation
48.22 benefits received by them must not be deducted from the benefits
48.23 payable under this section.
48.24 (g) The surviving spouse of a deceased former member who
48.25 had credit for three or more years of allowable service, but not
48.26 the spouse of a former member receiving a disability benefit
48.27 under section 352B.10, subdivision 2, is entitled to receive the
48.28 100 percent joint and survivor annuity at the time the deceased
48.29 member would have become 55 years old. If a former member dies
48.30 who does not qualify for other benefits under this chapter, the
48.31 surviving spouse or, if none, the children or heirs are entitled
48.32 to a refund of the accumulated deductions left in the fund plus
48.33 interest at the rate of six percent per year compounded annually.
48.34 Sec. 9. Minnesota Statutes 2002, section 352B.11, is
48.35 amended by adding a subdivision to read:
48.36 Subd. 2b. SURVIVING SPOUSE BENEFIT ELIGIBILITY. (a) If
49.1 an active member with three or more years of allowable service
49.2 dies before attaining age 55, the surviving spouse is entitled
49.3 to the benefit specified in subdivision 2c, paragraph (b).
49.4 (b) If an active member with less than three years of
49.5 allowable service dies at any age, the surviving spouse is
49.6 entitled to receive the benefit specified in subdivision 2c,
49.7 paragraph (c).
49.8 (c) If an active member with three or more years of
49.9 allowable service dies on or after attaining exact age 55, the
49.10 surviving spouse is entitled to receive the benefits specified
49.11 in subdivision 2c, paragraph (d).
49.12 (d) If a disabilitant dies while receiving a disability
49.13 benefit under section 352B.10 or before the benefit under that
49.14 section commenced, and an optional annuity was not elected under
49.15 section 352B.10, subdivision 5, the surviving spouse is entitled
49.16 to receive the benefit specified in subdivision 2c, paragraph
49.17 (b).
49.18 (e) If a former member with three or more years of
49.19 allowable service, who terminated from service and has not
49.20 received a refund or commenced receipt of any other benefit
49.21 provided by this chapter, dies, the surviving spouse is entitled
49.22 to receive the benefit specified in subdivision 2c, paragraph
49.23 (e).
49.24 (f) If a former member with less than three years of
49.25 allowable service, who terminated from service and has not
49.26 received a refund or commenced receipt of any other benefit, if
49.27 applicable, provided by this chapter, dies, the surviving spouse
49.28 is entitled to receive the refund specified in subdivision 2c,
49.29 paragraph (f).
49.30 Sec. 10. Minnesota Statutes 2002, section 352B.11, is
49.31 amended by adding a subdivision to read:
49.32 Subd. 2c. SURVIVING SPOUSE BENEFIT ENTITLEMENTS. (a) A
49.33 surviving spouse specified in subdivision 2b is eligible to
49.34 receive, following the filing of a valid application and
49.35 consistent with any other applicable requirements, a benefit as
49.36 specified in this subdivision. A 100 percent joint and survivor
50.1 annuity under paragraph (b) must be computed assuming the exact
50.2 age 55 for the deceased and the age of the surviving spouse on
50.3 the date of death. A 100 percent joint and survivor annuity
50.4 under paragraph (d) or (e) must be computed using the age of the
50.5 deceased on the date of death and the age of the surviving
50.6 spouse on that same date.
50.7 (b) For a surviving spouse specified in subdivision 2b,
50.8 paragraph (a) or (d), the surviving spouse benefit is a benefit
50.9 for life equal to 50 percent of the average monthly salary of
50.10 the deceased member. On the first of the month next following
50.11 the date on which the deceased member would have attained exact
50.12 age 55, in lieu of continued receipt of the prior benefit, the
50.13 surviving spouse is eligible to commence receipt of the second
50.14 half of a 100 percent joint and survivor annuity, if this
50.15 provides a larger benefit.
50.16 (c) For a surviving spouse specified in subdivision 2b,
50.17 paragraph (b), the surviving spouse benefit is a benefit for
50.18 life equal to 50 percent of the average monthly salary of the
50.19 deceased member.
50.20 (d) For a surviving spouse specified in subdivision 2b,
50.21 paragraph (c), the surviving spouse benefit is a benefit for
50.22 life equal to 50 percent of the average monthly salary of the
50.23 deceased member, or the second half of a 100 percent joint and
50.24 survivor annuity, whichever is larger.
50.25 (e) For a surviving spouse specified in subdivision 2b,
50.26 paragraph (e), the surviving spouse benefit is the second half
50.27 of a 100 percent joint and survivor annuity, commencing on the
50.28 first of the month next following the deceased member's date of
50.29 death, or the first of the month next following the date on
50.30 which the deceased member would have attained age 55, whichever
50.31 is later.
50.32 (f) For a surviving spouse specified in subdivision 2b,
50.33 paragraph (f), the surviving spouse or, if none, the children
50.34 or, if none, the deceased member's estate, is entitled to a
50.35 refund of the employee contributions plus interest computed as
50.36 specified in subdivision 1.
51.1 Sec. 11. Minnesota Statutes 2002, section 352B.11, is
51.2 amended by adding a subdivision to read:
51.3 Subd. 2d. COORDINATION WITH WORKERS' COMPENSATION
51.4 BENEFITS. If the deceased member died under circumstances that
51.5 entitle the surviving spouse and the dependent child or children
51.6 to receive benefits under workers' compensation law, the
51.7 workers' compensation benefits received by the deceased member's
51.8 survivor or survivors must not be deducted from the benefits
51.9 payable under this section.
51.10 Sec. 12. Minnesota Statutes 2002, section 352D.075,
51.11 subdivision 2, is amended to read:
51.12 Subd. 2. SURVIVING SPOUSE BENEFIT. (a) Notwithstanding
51.13 any designation of a beneficiary to the contrary, if a
51.14 participant or a former participant dies leaving a spouse and
51.15 there is no named beneficiary who survives to receive payment or
51.16 the spouse is named beneficiary before an annuity or a
51.17 disability benefit becomes payable, the surviving spouse may is
51.18 entitled to receive:
51.19 (1) a lump sum payment of the value of the participant's
51.20 total shares;
51.21 (2) The a lump sum payment of a portion of the value of
51.22 one-half of the total shares and beginning at age 55 or
51.23 thereafter, at any time after the participant's death, receive
51.24 an annuity based on the remaining value of one-half of the total
51.25 shares, provided that. If the spouse dies before receiving any
51.26 annuity payments, the remaining value of said the shares shall
51.27 be paid is payable to the spouse's children in equal shares, but
51.28 and if no such children survive, then to the parents of the
51.29 spouse in equal shares, but and if no such children or parents
51.30 survive, then to the estate of the spouse; or
51.31 (3) Beginning at age 55 or thereafter at any time after the
51.32 participant's death, receive an annuity based on the value of
51.33 the total shares, provided that. If the spouse dies before
51.34 receiving any annuity payments, the value of said the shares
51.35 shall be paid is payable to the spouse's children in equal
51.36 shares, but and if no such children survive, then to the parents
52.1 of the spouse in equal shares, but and if no such children or
52.2 parents survive, then to the estate of the spouse; and further
52.3 provided, if said the spouse dies after receiving annuity
52.4 payments but before receiving payments equal to the value of the
52.5 employee shares, the value of the employee shares
52.6 remaining shall be paid is payable to the spouse's children in
52.7 equal shares, but and if no such children survive, then to the
52.8 parents of the spouse in equal shares, but and if no such
52.9 children or parents survive, then to the estate of the spouse.
52.10 (b) A participant or a former participant and the person's
52.11 spouse may make a joint specification, in writing, on a form
52.12 prescribed by the executive director, that the benefits provided
52.13 in this section must be paid only to the designated beneficiary.
52.14 Sec. 13. Minnesota Statutes 2002, section 352D.075, is
52.15 amended by adding a subdivision to read:
52.16 Subd. 2a. SURVIVING SPOUSE COVERAGE TERM CERTAIN. In
52.17 lieu of the annuity under subdivision 2, clause (2) or (3), or
52.18 in lieu of a distribution under subdivision 2, clause (1), the
52.19 surviving spouse of a deceased participant may elect to receive
52.20 survivor coverage in the form of a term certain annuity of five,
52.21 six, 15, or 20 years, based on the value of the remaining
52.22 shares. The monthly term certain annuity must be calculated
52.23 under section 352D.06, subdivision 1.
52.24 Sec. 14. Minnesota Statutes 2002, section 352D.075,
52.25 subdivision 3, is amended to read:
52.26 Subd. 3. REFUND TO BENEFICIARY. If a participant dies
52.27 and has named a beneficiary no surviving spouse, the value of
52.28 the total shares shall be paid is payable to such a designated
52.29 beneficiary, but if such the beneficiary dies before receiving
52.30 payment, or if no beneficiary has been named and there is no
52.31 spouse, the value of said the shares shall be paid is payable
52.32 to the children of the participant in equal shares, but or if no
52.33 such children survive, then in equal shares to the parents of
52.34 the participant, but or if no such children or parents survive,
52.35 then to the estate of the participant.
52.36 Sec. 15. 352F.052 APPLICATION OF SURVIVING SPOUSE,
53.1 DEPENDENT CHILD PROVISION.
53.2 Notwithstanding any provisions of law to the contrary,
53.3 subdivisions within section 352.12 of the edition of Minnesota
53.4 Statutes published in the year before the year in which a
53.5 privatization occurred, applicable to the surviving spouse or
53.6 dependent children of a former member, apply to the survivors of
53.7 a terminated hospital employee of Fairview, University of
53.8 Minnesota Physicians, or University Affiliated Family Physicians.
53.9 Sec. 16. 353F.052 APPLICATION OF SURVIVING SPOUSE,
53.10 DEPENDENT CHILD PROVISION.
53.11 Notwithstanding any provisions of law to the contrary,
53.12 subdivisions within section 353.32 of the edition of Minnesota
53.13 Statutes published in the year before the year in which a
53.14 privatization occurred, applicable to the surviving spouse or
53.15 dependent children of a former member as defined in section
53.16 353.01, subdivision 7a, apply to the survivors of a terminated
53.17 medical facility or other public employing unit employee.
53.18 Sec. 17. Minnesota Statutes 2002, section 354.05,
53.19 subdivision 22, is amended to read:
53.20 Subd. 22. DESIGNATED BENEFICIARY. "Designated
53.21 beneficiary" means the person, trust, or organization designated
53.22 by a retiree or member to receive the benefits to which a
53.23 beneficiary is entitled under this chapter. A beneficiary
53.24 designation is valid only if it is made on an appropriate form
53.25 provided by the executive director that is signed by the member
53.26 and two witnesses to the member's signature. The properly
53.27 completed form must be received by the association on or before
53.28 the date of death of the retiree or member. If a retiree or a
53.29 member does not designate a person, trust, or organization, or
53.30 if the person who was designated predeceases the retiree or the
53.31 member, or if the trust or organization ceases to exist before
53.32 the death of the retiree or the member, the designated
53.33 beneficiary means is the estate of the deceased retiree or
53.34 member.
53.35 Sec. 18. Minnesota Statutes 2002, section 354.46,
53.36 subdivision 2, is amended to read:
54.1 Subd. 2. DEATH WHILE ELIGIBLE DESIGNATED BENEFICIARY
54.2 BENEFIT SURVIVING SPOUSE SURVIVOR COVERAGE. (a) The surviving
54.3 spouse of any member or former member who has If the active or
54.4 deferred member was at least age 55 and had credit for at least
54.5 three years of allowable service on the date of death, the
54.6 surviving spouse is entitled to the second portion of a 100
54.7 percent joint and survivor annuity coverage in the event of
54.8 death of the member prior to retirement. If the surviving
54.9 spouse does not elect to receive a surviving spouse benefit
54.10 under subdivision 1, if applicable, or does not elect to receive
54.11 a refund of accumulated member contributions under section
54.12 354.47, subdivision 1, the surviving spouse is entitled to
54.13 receive, upon written application on a form prescribed by the
54.14 executive director, a benefit equal to the second portion of a
54.15 100 percent joint and survivor annuity specified under section
54.16 354.45, based on the age of the active or deferred member and
54.17 surviving spouse at the time of death of the member, and
54.18 computed under section 354.44, subdivision 2 or 6, whichever is
54.19 applicable the age of the surviving spouse at the time the
54.20 benefit accrues.
54.21 (b) If the active or deferred member was under age 55 and
54.22 has had credit for at least 30 years of allowable service on the
54.23 date of death, the surviving spouse may elect to receive the
54.24 second portion of a 100 percent joint and survivor annuity based
54.25 on the age of the active or deferred member and surviving spouse
54.26 on the date of death and the age of the surviving spouse at the
54.27 time the benefit accrues. If section 354.44, subdivision 6,
54.28 applies, the annuity is payable using the full early retirement
54.29 reduction under section 354.44, subdivision 6, paragraph
54.30 clause (3)(ii), to age 55 and one-half of the early retirement
54.31 reduction from age 55 to the age payment begins.
54.32 (c) If the active or deferred member was under age 55 and
54.33 has had credit for at least three years of allowable service on
54.34 the date of death, but did not yet qualify for retirement, the
54.35 surviving spouse may elect to receive the second portion of a
54.36 100 percent joint and survivor annuity based on the age of
55.1 the active or deferred member and the surviving spouse at the
55.2 time of death and the age of the surviving spouse at the time
55.3 the benefit accrues. If section 354.44, subdivision 6, applies,
55.4 the annuity is calculated using the full early retirement
55.5 reduction under section 354.44, subdivision 6, to age 55 and
55.6 one-half of the early retirement reduction from age 55 to the
55.7 age the annuity begins. The surviving spouse eligible for a
55.8 surviving spouse benefit under paragraph (a) may apply for the
55.9 annuity at any time after the date on which the deceased
55.10 employee would have attained the required age for retirement
55.11 based on the employee's allowable service.
55.12 (d) The surviving spouse eligible for surviving spouse
55.13 benefits under paragraph (b) or (c) this subdivision may apply
55.14 for the annuity any time after the member's death. This The
55.15 benefit accrues from the day following the date of the member's
55.16 death but may not begin to accrue more than six months before
55.17 the date the application is filed with the executive
55.18 director and may not accrue before the member's death. Sections
55.19 354.55, subdivision 11, and 354.60 apply to a deferred annuity
55.20 payable under this section. The benefit is payable for life.
55.21 Any benefit under this subdivision is in lieu of benefits under
55.22 subdivision 1, if applicable, and in lieu of a refund of
55.23 accumulated member contributions under section 354.47,
55.24 subdivision 1.
55.25 Sec. 19. Minnesota Statutes 2002, section 354.46,
55.26 subdivision 2b, is amended to read:
55.27 Subd. 2b. DEPENDENT CHILD SURVIVOR COVERAGE. If there is
55.28 no surviving spouse eligible for benefits under subdivision 2, a
55.29 each dependent child or children as defined in section 354.05,
55.30 subdivision 8a, is eligible for monthly payments surviving child
55.31 benefits. Payments Surviving child benefits to a dependent
55.32 child must be paid from the date of the member's death to the
55.33 date the dependent child attains age 20 if the child is under
55.34 age 15 on the date of the member's death. If the child is 15
55.35 years or older on the date of the member's death, payment must
55.36 be made the surviving child benefit is payable for five years.
56.1 The payment to a dependent surviving child benefit is an amount
56.2 actuarially equivalent to the value of a 100 percent optional
56.3 annuity under subdivision 2 calculated using the age of the
56.4 member and age of the dependent child at as of the date of death
56.5 in lieu of the age of the member and the spouse. If there is
56.6 more than one dependent child, each dependent child shall is
56.7 entitled to receive a proportionate share of the actuarial value
56.8 of the member's account.
56.9 Sec. 20. Minnesota Statutes 2002, section 354.46,
56.10 subdivision 5, is amended to read:
56.11 Subd. 5. PAYMENT SURVIVING SPOUSE SURVIVOR BENEFIT TO
56.12 DESIGNATED BENEFICIARY. A member and the spouse of the member
56.13 may make a joint specification in writing on a form prescribed
56.14 by the executive director that the benefits provided in
56.15 subdivision 2, or in section 354.47, subdivision 1, must be paid
56.16 only to a designated beneficiary or to designated beneficiaries.
56.17 For purposes of subdivision 2, A designated beneficiary may only
56.18 must be either a former spouse or a biological or adopted child
56.19 of the member.
56.20 Sec. 21. Minnesota Statutes 2002, section 354.46, is
56.21 amended by adding a subdivision to read:
56.22 Subd. 6. APPLICATION. (a) A beneficiary designation and
56.23 an application for benefits under this section must be in
56.24 writing on a form prescribed by the executive director.
56.25 (b) Sections 354.55, subdivision 11, and 354.60 apply to a
56.26 deferred annuity payable under this section.
56.27 (c) Unless otherwise specified, the annuity must be
56.28 computed under section 354.44, subdivision 2 or 6, whichever is
56.29 applicable.
56.30 Sec. 22. Minnesota Statutes 2002, section 356.441, is
56.31 amended to read:
56.32 356.441 REPAYMENT OF REFUNDS PAYMENT ACCEPTANCE ALLOWED.
56.33 Subdivision 1. PAYMENT AUTHORIZATION. The repayment of a
56.34 refund and interest on that refund or the payment of equivalent
56.35 contributions and interest for an eligible leave of absence, as
56.36 permitted under laws governing any public pension plan in
57.1 Minnesota, may be made:
57.2 (1) with funds distributed or transferred from a plan
57.3 qualified under the federal Internal Revenue Code of 1986,
57.4 section 401, subsection (a) or (k); 403; 408; or 457, subsection
57.5 (b), as amended through December 31, 1988, or an annuity
57.6 qualified under the federal Internal Revenue Code of 1986,
57.7 section 403(a). Repayment may also be made from time to time;
57.8 or
57.9 (2) with funds distributed from an individual retirement
57.10 account used solely to receive a or individual retirement
57.11 annuity, if done solely in a manner that is eligible for
57.12 treatment as a nontaxable rollover from that type of a plan or
57.13 annuity or transfer under the applicable federal law. The
57.14 repaid refund
57.15 Subd. 2. SEPARATE ACCOUNTING REQUIREMENT. Nontaxable
57.16 rollovers or transfer amounts under subdivision 1 received by a
57.17 public pension fund must be separately accounted for as member
57.18 contributions not previously taxed. Before accepting
57.19 any rollovers or transfers to which this section applies, the
57.20 executive director must shall require the member to provide
57.21 written documentation to demonstrate that the amounts to
57.22 be rolled over or transferred are eligible for a tax-free
57.23 rollover or transfer and qualify for that treatment under the
57.24 federal Internal Revenue Code of 1986, as amended.
57.25 Sec. 23. Minnesota Statutes 2002, section 490.124,
57.26 subdivision 12, is amended to read:
57.27 Subd. 12. REFUND. (a) Any A person who ceases to be a
57.28 judge but who does not qualify for a retirement annuity or other
57.29 benefit under section 490.121 shall be is entitled to a refund
57.30 in an amount equal to all the person's member's employee
57.31 contributions to the judges' retirement fund plus interest
57.32 computed to the first day of the month in which the refund is
57.33 processed based on fiscal year balances at an annual rate of
57.34 five percent compounded annually under section 352.22,
57.35 subdivision 2.
57.36 (b) A refund of contributions under paragraph (a)
58.1 terminates all service credits and all rights and benefits of
58.2 the judge and the judge's survivors. A person who becomes a
58.3 judge again after taking a refund under paragraph (a) may
58.4 reinstate the previously terminated service credits, rights, and
58.5 benefits by repaying all refunds the total amount of the
58.6 previously received refund. A The refund repayment must include
58.7 interest on the total amount previously received at an annual
58.8 rate of 8.5 percent compounded annually from the date on which
58.9 the refund was received until the date on which the refund is
58.10 repaid.
58.11 Sec. 24. REPEALER.
58.12 Minnesota Statutes 2002, section 354A.107, is repealed.
58.13 Sec. 25. EFFECTIVE DATE.
58.14 (a) Sections 1 to 24 are effective on July 1, 2004.
58.15 (b) Sections 8 to 11 are not intended to increase, modify,
58.16 impair, or diminish the benefit entitlements specified in
58.17 Minnesota Statutes, chapter 352B. If the Minnesota state
58.18 retirement system executive director determines that any
58.19 provision of those sections does increase, modify, impair, or
58.20 diminish the benefit entitlements as reflected in applicable law
58.21 just prior to the effective date of this section, the executive
58.22 director shall certify that determination and a recommendation
58.23 as to the required legislative correction to the chairs of the
58.24 legislative commission on pensions and retirement, the house
58.25 governmental operations committee, the senate governmental
58.26 operations committee, and the executive director of the
58.27 legislative commission on pensions and retirement.
58.28 (c) Consistent with Minnesota Statutes, section 645.21, and
58.29 public pension policy in general, the increased interest rate
58.30 provided on a refund under section 23 applies only to judges
58.31 whose termination of service occurs on or after July 1, 2004.
58.32 ARTICLE 10
58.33 FEDERAL INTERNAL REVENUE
58.34 CODE COMPLIANCE
58.35 Section 1. Minnesota Statutes 2002, section 356.611, is
58.36 amended by adding a subdivision to read:
59.1 Subd. 4. COMPENSATION. (a) For purposes of this section,
59.2 compensation means a member's compensation actually paid or made
59.3 available for any limitation year determined as provided by
59.4 Treasury Regulation Section 1.415-2(d)(10).
59.5 (b) Compensation for any period includes:
59.6 (1) any elective deferral as defined in section 402(g)(3)
59.7 of the Internal Revenue Code;
59.8 (2) any elective amounts that are not includable in a
59.9 member's gross income by reason of sections 125 or 457 of the
59.10 Internal Revenue Code; and
59.11 (3) any elective amounts that are not includable in a
59.12 member's gross income by reason of section 132(f)(4) of the
59.13 Internal Revenue Code.
59.14 Sec. 2. 356.635 INTERNAL REVENUE CODE COMPLIANCE.
59.15 Subdivision 1. RETIREMENT BENEFIT COMMENCEMENT. The
59.16 retirement benefit of a member who has terminated employment
59.17 must begin no later than the later of April 1 of the calendar
59.18 year following the calendar year that the member attains the
59.19 federal minimum distribution age under section 401(a)(9) of the
59.20 Internal Revenue Code or April 1 of the calendar year following
59.21 the calendar year in which the member terminated employment.
59.22 Subd. 2. DISTRIBUTIONS. Distributions shall be made as
59.23 required under section 401(a)(9) of the Internal Revenue Code
59.24 and the treasury regulations adopted under that section,
59.25 including, but not limited to, the incidental death benefit
59.26 provisions of section 401(a)(9)(G) of the Internal Revenue Code.
59.27 Subd. 3. DIRECT ROLLOVERS. A distributee may elect, at
59.28 the time and in the manner prescribed by the plan administrator,
59.29 to have all or any portion of an eligible rollover distribution
59.30 paid directly to an eligible retirement plan as specified by the
59.31 distributee.
59.32 Subd. 4. ELIGIBLE ROLLOVER DISTRIBUTION. An "eligible
59.33 rollover distribution" is any distribution of all or any portion
59.34 of the balance to the credit of the distributee.
59.35 Subd. 5. INELIGIBLE AMOUNTS. An eligible rollover
59.36 distribution does not include:
60.1 (1) a distribution that is one of a series of substantially
60.2 equal periodic payments, receivable annually or more frequently,
60.3 that is made for the life or life expectancy of the distributee,
60.4 the joint lives or joint life expectancies of the distributee
60.5 and the distributee's designated beneficiary, or for a specified
60.6 period of ten years or more;
60.7 (2) a distribution that is required under section 401(a)(9)
60.8 of the Internal Revenue Code; or
60.9 (3) any other exception required by law or the Internal
60.10 Revenue Code.
60.11 Subd. 6. ELIGIBLE RETIREMENT PLAN. (a) An "eligible
60.12 retirement plan" is:
60.13 (1) an individual retirement account under section 408(a)
60.14 of the Internal Revenue Code;
60.15 (2) an individual retirement annuity plan under section
60.16 408(b) of the Internal Revenue Code;
60.17 (3) an annuity plan under section 403(a) of the Internal
60.18 Revenue Code;
60.19 (4) a qualified trust plan under section 401(a) of the
60.20 Internal Revenue Code that accepts the distributee's eligible
60.21 rollover distribution;
60.22 (5) an annuity contract under section 403(b) of the
60.23 Internal Revenue Code; or
60.24 (6) an eligible deferred compensation plan under section
60.25 457(b) of the Internal Revenue Code, which is maintained by a
60.26 state or local government and which agrees to separately account
60.27 for the amounts transferred into the plan.
60.28 (b) For distributions of after-tax contributions which are
60.29 not includable in gross income, the after-tax portion may be
60.30 transferred only to an individual retirement account or annuity
60.31 described in section 408(a) or (b) of the Internal Revenue Code,
60.32 or to a qualified defined contribution plan described in either
60.33 section 401(a), or section 403(a), of the Internal Revenue Code,
60.34 that agrees to separately account for the amounts transferred,
60.35 including separately accounting for the portion of the
60.36 distribution which is includable in gross income and the portion
61.1 of the distribution which is not includable.
61.2 Subd. 7. DISTRIBUTEE. A "distributee" is:
61.3 (1) an employee or a former employee;
61.4 (2) the surviving spouse of an employee or former employee;
61.5 or
61.6 (3) the former spouse of the employee or former employee
61.7 who is the alternate payee under a qualified domestic relations
61.8 order as defined in section 414(p) of the Internal Revenue Code,
61.9 or who is a recipient of a court-ordered equitable distribution
61.10 of marital property, as provided in section 518.58.
61.11 Subd. 8. FORFEITURES. For defined benefit plans, unless
61.12 otherwise permitted by section 401(a)(8) of the Internal Revenue
61.13 Code, forfeitures may not be applied to increase the benefits
61.14 that any employee would otherwise receive under the plan.
61.15 Subd. 9. MILITARY SERVICE. Contributions, benefits, and
61.16 service credit with respect to qualified military service must
61.17 be provided according to section 414(u) of the Internal Revenue
61.18 Code.
61.19 Sec. 3. TRANSITIONAL PROVISION.
61.20 (a) An eligible rollover distribution under Minnesota
61.21 Statutes, section 356.635, does not include the portion of a
61.22 distribution that is not included in gross income.
61.23 (b) For eligible rollover distributions to a surviving
61.24 spouse, an eligible retirement plan under Minnesota Statutes,
61.25 section 356.635, is limited to an individual retirement account
61.26 under section 408(a) of the Internal Revenue Code or an
61.27 individual retirement annuity plan under section 408(b) of the
61.28 Internal Revenue Code.
61.29 Sec. 4. EFFECTIVE DATE.
61.30 (a) Section 1 is effective on July 1, 2004. Section 1 is
61.31 effective retroactively as follows:
61.32 subdivision effective
61.33 4, paragraph (b), for limitation years
61.34 clauses (1) and (2) beginning on and after
61.35 January 1, 1998; and
61.36 4, paragraph (b), for limitation years
61.37 clause (3) beginning on and after
61.38 January 1, 2001
62.1 (b) Sections 2 and 3 are effective on the day following
62.2 final enactment.
62.3 (c) Section 2 is effective retroactively as follows:
62.4 subdivision effective
62.5 1 on and after January 1, 1989
62.6 2 for distributions on and after
62.7 December 31, 1989
62.8 3 for distributions on and after
62.9 January 1, 1993
62.10 6, paragraph (a), for distributions made after
62.11 clauses (5) and (6) December 31, 2001
62.12 6, paragraph (b) for distributions after
62.13 December 31, 2001
62.14 9 on December 12, 1994
62.15 (d) Section 3 is effective only for distributions made
62.16 before January 1, 2002."
62.17 Delete the title and insert:
62.18 "A bill for an act
62.19 relating to retirement; statewide and major local
62.20 public pension plans; making various changes of an
62.21 administrative nature; amending Minnesota Statutes
62.22 2002, sections 3A.03, subdivision 2; 352.01,
62.23 subdivision 13; 352.113, by adding a subdivision;
62.24 352.12, subdivisions 1 and 6; 352.22, subdivisions 2
62.25 and 3; 352.95, subdivisions 1, 2, and 4; 352B.01,
62.26 subdivision 11; 352B.10, subdivisions 1, 2, 3, 4, and
62.27 5; 352B.105; 352B.11, subdivisions 1 and 2, and by
62.28 adding subdivisions; 352D.065, subdivision 2;
62.29 352D.075, subdivisions 2 and 3, and by adding a
62.30 subdivision; 353.01, subdivisions 2b, 10, 12a, and
62.31 12b; 353.33, subdivisions 4, 6, 6b, and 7; 353.37,
62.32 subdivision 3, and by adding a subdivision; 354.05,
62.33 subdivisions 2 and 22; 354.07, subdivision 9; 354.091;
62.34 354.096, subdivision 1; 354.42, subdivision 7; 354.44,
62.35 subdivision 4; 354.46, subdivisions 2, 2b, and 5, and
62.36 by adding a subdivision; 354.48, subdivisions 2, 4, 6,
62.37 and 6a; 354.51, subdivision 5; 354.52, subdivisions 4a
62.38 and 6, and by adding a subdivision; 354.53; 354.66,
62.39 subdivision 2; 354A.093; 354A.36, subdivisions 4 and
62.40 6; 354B.20, subdivisions 4 and 6; 354B.23, subdivision
62.41 1; 354B.32; 354C.11, subdivision 2; 356.441; 356.611,
62.42 subdivision 2, and by adding subdivisions; and
62.43 490.124, subdivision 12; proposing coding for new law
62.44 in/as Minnesota Statutes, chapters 352F; 353F; and
62.45 356; repealing Minnesota Statutes 2002, sections
62.46 352D.02, subdivision 5; 353.33, subdivision 5b;
62.47 354A.107; and 490.11."