The Senate Taxes Committee passed the following amendments to S.F. 676, the 2nd Engrossment:
............... moves to amend S.F. No. 676, the second
1.1 engrossment (S0676-2), as follows:
1.2 Page 122, line 26, delete "4" and insert "3"
1.1 ............... moves to amend S.F. No. 676, the second
1.2 engrossment (S0676-2), as follows:
1.3 Page 46, after line 20, insert:
1.4 "Sec. 5. LEGISLATIVE COMMISSION ON PENSIONS AND
1.5 RETIREMENT; ACTUARIAL SERVICES BILLING TO THIRD PARTIES.
1.6 Notwithstanding any provision of law to the contrary, the
1.7 legislative commission on pensions and retirement may bill third
1.8 parties for actuarial services performed for their benefit under
1.9 its contract with its consulting actuary under Minnesota
1.10 Statutes, section 3.85, may deposit the actuarial services
1.11 reimbursements from those third parties to the credit of the
1.12 commission and those deposited reimbursements are reappropriated
1.13 to the commission."
1.14 Page 46, line 22, before "Sections" insert "(a)"
1.15 Page 46, after line 22, insert:
1.16 "(b) Section 5 is effective retroactively to July 1, 2003,
1.17 and expires when the duty of the legislative commission on
1.18 pensions and retirement to retain a consulting actuary to
1.19 perform annual actuarial valuations of retirement plans
1.20 terminates."
1.21 Renumber the sections in sequence
SCS0676A11 (Verbally amended, not reflected here)
1.1 Senator ..... moves to amend S.F. No. 676 as follows:
1.2 Page 9, after line 28, insert:
1.3 "Sec. 5. Minnesota Statutes 2002, section 353.64, is
1.4 amended by adding a subdivision to read:
1.5 Subd. 6a. UNIVERSITY OF MINNESOTA POLICE OFFICERS. A
1.6 police officer employed by the University of Minnesota who is
1.7 required to contribute to the University of Minnesota Faculty
1.8 Retirement Plan shall not be a member of the public employees
1.9 police and fire fund.
1.10 EFFECTIVE DATE. This section is effective the day
1.11 following final enactment."
1.12 Renumber the sections in sequence and correct the internal
1.13 references
1.14 Amend the title accordingly
1.1 Senator ..... moves to amend S.F. No. 676 as follows:
1.2 Page 15, line 8, before the semicolon, insert "and amounts
1.3 paid by employers as the result of employee wage reductions, or
1.4 instead of wage increases, to supplemental national or
1.5 international pension plans permitted under section 356.24,
1.6 subdivision 1"
1.7 Page 15, line 30, after the second comma, insert "except
1.8 for amounts paid by employers as the result of employee wage
1.9 reductions, or instead of wage increases, to supplemental
1.10 national or international pension plans permitted under section
1.11 356.24, subdivision 1"
1.1 Senator ..... moves to amend S.F. No. 676 as follows:
1.2 Page 149, after line 31, insert:
1.3 "ARTICLE 21
1.4 MINNEAPOLIS TEACHERS
1.5 RETIREMENT FUND ASSOCIATION
1.6 CONSOLIDATION WITH THE TEACHERS RETIREMENT ASSOCIATION
1.7 Section 1. 128D.18 FUNDING OF UNFUNDED PENSION
1.8 LIABILITIES.
1.9 Subdivision 1. FINANCING AUTHORITY. Notwithstanding any
1.10 other law to the contrary, special school district No. 1,
1.11 Minneapolis, may finance all or a portion of the current and
1.12 future unfunded pension liability of the Minneapolis teachers
1.13 retirement fund association through the issuance of revenue
1.14 bonds issued pursuant to this section; provided that the
1.15 following conditions are met:
1.16 (a) The bonds shall be payable from state funds and other
1.17 contributions appropriated to the Minneapolis teachers
1.18 retirement fund association to pay unfunded pension liabilities,
1.19 including, without limitation, special direct aid, matching aid,
1.20 or other contributions under section 354A.12, subdivision 3a or
1.21 3b, or any other subsequent state appropriation for such
1.22 purpose, and the other sources of funds set forth in this
1.23 section.
1.24 (b) At the time of issuance of the bonds, section 354A.12,
1.25 subdivisions 3a and 3b have not been repealed or amended.
1.26 (c) The principal amount of bonds issued and outstanding
1.27 hereunder shall not exceed the unfunded actuarial accrued
1.28 liability determined by the actuary retained by the legislative
1.29 commission on pensions and retirement for the fiscal year ending
1.30 June 30, 2002, pursuant to sections 356.215 and 356.216.
1.31 Subd. 2. USE OF PROCEEDS. The proceeds of the bonds
1.32 issued, less costs of issuance and net original issue discount,
1.33 shall be paid to the state board of investment to be deposited
1.34 as an asset of the Minneapolis teachers retirement fund
1.35 association. The proceeds shall be held in trust by the state
1.36 board of investment for the benefit of the Minneapolis teachers
2.1 retirement fund association and invested as set forth in
2.2 subdivision 3. Annually, on the first banking day of the
2.3 calendar year, the state board of investment shall pay to the
2.4 Minneapolis teachers retirement fund association from the funds
2.5 and with investment income thereof, the amount, if any, needed
2.6 by the pension fund in any year to pay retirement annuities and
2.7 benefits that are due and payable or the reasonable and
2.8 necessary administrative expenses of the retirement plan that
2.9 are due and payable after all assets held by the association,
2.10 other than those assets held by the state board of investment,
2.11 have been exhausted.
2.12 Subd. 3. APPROPRIATIONS. (a) Notwithstanding any law to
2.13 the contrary, special direct state aid, matching aid, and other
2.14 contributions levied for the Minneapolis teachers retirement
2.15 fund association under section 354A.12, subdivisions 3a and 3b,
2.16 and amortization or supplementary amortization state aid
2.17 reallocated to the Minneapolis teachers retirement fund
2.18 association under section 423A.02 are pledged and appropriated
2.19 to the payment of the bonds and must be transferred to special
2.20 school district No. 1, Minneapolis, and additional employer
2.21 contributions levied by special school district No. 1 under
2.22 section 354A.12, subdivision 3b, shall be retained by the
2.23 district to the extent required to pay debt service on the bonds
2.24 for the succeeding 12-month period or a longer period
2.25 established pursuant to the resolution of the district
2.26 authorizing the bonds.
2.27 (b) The bond proceeds based on the funding sources for the
2.28 Minneapolis teachers retirement fund association referenced in
2.29 paragraph (a) must be invested by the state board of investment
2.30 in trust for the exclusive benefit of the Minneapolis teachers
2.31 retirement fund association. Notwithstanding any law to the
2.32 contrary, section 356A.02 shall not apply to the Minneapolis
2.33 teachers retirement fund association with respect to any bond
2.34 proceeds held and invested by the state board of investment
2.35 pursuant to this section.
2.36 (c) For purposes of annual actuarial valuations and annual
3.1 financial reports, the assets of the Minneapolis teachers
3.2 retirement fund association held by the state board of
3.3 investment pursuant to this section must not be considered as
3.4 current assets of the Minneapolis teachers retirement fund
3.5 association but may be considered as future assets in a similar
3.6 manner as future contributions to the funds. For purposes of
3.7 calculating the cost-of-living adjustment based on the five-year
3.8 annualized rate of investment return under section 354A.28,
3.9 subdivision 9, whenever the required contributions under chapter
3.10 356 exceed the statutory contributions under chapter 354A so
3.11 that a contribution deficiency exists according to the most
3.12 recent actuarial report by the actuary retained by the
3.13 legislative commission on pensions and retirement, the
3.14 cost-of-living adjustment shall be reduced by the ratio of the
3.15 assets invested with the state board of investment and owned by
3.16 the Minneapolis teachers retirement fund association to the
3.17 total assets owned by the Minneapolis teachers retirement fund
3.18 association.
3.19 Subd. 4. NO ELECTION. No election of the voters of the
3.20 district shall be required to issue bonds authorized by this
3.21 section.
3.22 Subd. 5. TERMS AND SALE OF BONDS. The bonds issued
3.23 pursuant to this section shall bear interest at the rate or
3.24 rates and mature on the date or dates not more than 30 years
3.25 from the date of issue as the district shall determine by
3.26 resolution. Interest may be at a fixed or variable rate. The
3.27 bonds may be sold at a negotiated sale or by competitive bid.
3.28 Subd. 6. THIS SECTION PREVAILS. Notwithstanding any
3.29 other law to the contrary, this section shall apply to the
3.30 issuance and sale of the bonds and to the purposes for which the
3.31 bonds may be issued.
3.32 Subd. 7. TENDER OPTION. An obligation may be issued
3.33 giving its owner the right to tender or the authority to demand
3.34 tender of the obligation to special school district No. 1 or
3.35 another person designated by it, for purchase at a specified
3.36 time or times, if the district has first entered into an
4.1 agreement with a suitable financial institution obligating the
4.2 financial institution to provide funds on a timely basis for
4.3 purchase of bonds tendered. The obligation is not considered to
4.4 mature on any tender date and the purchase of a tendered
4.5 obligation is not considered a payment or discharge of the
4.6 obligation by the district. Obligations tendered for purchase
4.7 may be remarketed by or on behalf of the district or another
4.8 purchaser. The district may enter into agreements it considers
4.9 appropriate to provide for the purchase and remarketing of
4.10 tendered obligations, including:
4.11 (1) provisions under which undelivered obligations may be
4.12 considered tendered for purchase and new obligations may be
4.13 substituted for them;
4.14 (2) provisions for the payment of charges of tender agents,
4.15 remarketing agents, and financial institutions extending lines
4.16 of credit or letters of credit assuring repurchase; and
4.17 (3) provisions for reimbursement of advances under letters
4.18 of credit that may be paid from the proceeds of the obligations
4.19 or from tax and other revenues appropriated for the payment and
4.20 security of the obligations and similar or related provisions.
4.21 Subd. 8. INTEREST EXCHANGES. Special school district No.
4.22 1 may enter into an agreement with a third party for an exchange
4.23 of interest rates under this subdivision. With respect to
4.24 outstanding obligations bearing interest at a variable rate, the
4.25 district may agree to pay sums equal to interest at a fixed rate
4.26 or at a different variable rate determined in accordance with a
4.27 formula set out in the agreement on an amount not exceeding the
4.28 outstanding principal amount of the obligations, in exchange for
4.29 an agreement by the third party to pay sums equal to interest on
4.30 a similar amount at a variable rate determined according to a
4.31 formula set out in the agreement. With respect to outstanding
4.32 obligations bearing interest at a fixed rate or rates, the
4.33 district may agree to pay sums equal to interest at a variable
4.34 rate determined according to a formula set out in the agreement
4.35 on an amount not exceeding the outstanding principal amount of
4.36 the obligations in exchange for an agreement by the third party
5.1 to pay sums equal to interest on a similar amount at a fixed
5.2 rate or rates set out in the agreement. Subject to any
5.3 applicable bonds covenants, payments required to be made by the
5.4 district under the swap agreement may be made from amounts
5.5 secured to pay debt service on the obligations with respect to
5.6 which the swap agreement was made from any other available
5.7 source of the district.
5.8 Subd. 9. STATE PLEDGE AGAINST IMPAIRMENT OF
5.9 CONTRACTS. The state pledges and agrees with the holders of
5.10 bonds issued under this section that the state will not limit or
5.11 alter the rights vested in special school district No. 1 to
5.12 fulfill the terms of any agreements made with the bondholders or
5.13 in any way impair the rights and remedies of the holders until
5.14 the bonds, together with interest on them, with interest on any
5.15 unpaid installments of interest, and all costs and expenses in
5.16 connection with any action or proceeding by or on behalf of the
5.17 bondholders, are fully met and discharged. The district may
5.18 include this pledge and agreement of the state in any agreement
5.19 with the holders of bonds issued under this section.
5.20 Subd. 10. NOT NET DEBT. Bonds ended under this section
5.21 not in default shall not be deemed net debt under any law
5.22 limiting indebtedness.
5.23 Subd. 11. CERTIFICATION AND BUDGET REQUEST. To ensure
5.24 the payment of the principal of and interest on bonds issued
5.25 under this section, the superintendent of schools of special
5.26 school district No. 1, Minneapolis, shall annually determine and
5.27 certify to the governor, on or before December 1, the following
5.28 amounts:
5.29 (1) the amount then needed to pay unpaid debt service on
5.30 the bonds currently due and payable;
5.31 (2) the amount of any state aids used to pay debt service
5.32 on the bonds pursuant to this section; and
5.33 (3) the amount required to pay debt service on the bonds
5.34 during the then-current fiscal year, less amounts appropriated
5.35 and available for debt service pursuant to section 354A.12,
5.36 subdivisions 3a and 3b.
6.1 The legislature shall consider including a separate line
6.2 item in the biennial budget for the following fiscal year, or in
6.3 a supplemental budget if the biennial budget has previously been
6.4 approved, all amounts certified by the superintendent of schools
6.5 of special school district No. 1, Minneapolis, in accordance
6.6 with this subdivision.
6.7 Subd. 12. AID REDUCTION FOR REPAYMENT. If the amount
6.8 transferred by special school district No. 1, Minneapolis, to
6.9 the paying agent for the bonds is insufficient to pay required
6.10 debt service, the paying agent shall notify the commissioner of
6.11 finance. The commissioner shall reduce any and all unrestricted
6.12 state aids generally available to the school district by the
6.13 amount of the deficiency and pay the amounts to the paying agent
6.14 for the bonds for the payment of debt service. If the state
6.15 aids are reduced pursuant to this subdivision, the district may
6.16 levy a tax in the amount of the reduction in state aid.
6.17 Notwithstanding any other law to the contrary, no election of
6.18 the voters of the district is required for the levy and the levy
6.19 is not subject to other levy limitations.
6.20 Subd. 13. EXEMPTION. Interest on the bonds shall not be
6.21 included in taxable net income of individuals, estates, and
6.22 trusts for state income tax purposes and is not an item of tax
6.23 reference in determining state alternative minimum tax
6.24 applicable to individuals or corporations.
6.25 Sec. 2. Minnesota Statutes 2002, section 354.05,
6.26 subdivision 2, is amended to read:
6.27 Subd. 2. TEACHER. (a) "Teacher" means:
6.28 (1) a person who renders service as a teacher, supervisor,
6.29 principal, superintendent, librarian, nurse, counselor, social
6.30 worker, therapist, or psychologist in a public school of the
6.31 state located outside of the corporate limits of a city of the
6.32 first class the city of Duluth or of the city of St. Paul, or in
6.33 any charter school, irrespective of the location of the school,
6.34 or in any charitable, penal, or correctional institutions of a
6.35 governmental subdivision, or who is engaged in educational
6.36 administration in connection with the state public school
7.1 system, but excluding the University of Minnesota, whether the
7.2 position be a public office or an employment, not including
7.3 members or officers of any general governing or managing board
7.4 or body;
7.5 (2) an employee of the Teachers Retirement Association;
7.6 (3) a person who renders teaching service on a part-time
7.7 basis and who also renders other services for a single employing
7.8 unit. A person whose teaching service comprises at least 50
7.9 percent of the combined employment salary is a member of the
7.10 association for all services with the single employing unit. If
7.11 the person's teaching service comprises less than 50 percent of
7.12 the combined employment salary, the executive director must
7.13 determine whether all or none of the combined service is covered
7.14 by the association; or
7.15 (4) a person who is not covered by the plans established
7.16 under chapter 352D, 354A, or 354B and who is employed by the
7.17 Board of Trustees of the Minnesota State Colleges and
7.18 Universities system in an unclassified position as:
7.19 (i) a president, vice-president, or dean;
7.20 (ii) a manager or a professional in an academic or an
7.21 academic support program other than specified in item (i);
7.22 (iii) an administrative or a service support faculty
7.23 position; or
7.24 (iv) a teacher or a research assistant.
7.25 (b) "Teacher" does not mean:
7.26 (1) a person who works for a school or institution as an
7.27 independent contractor as defined by the Internal Revenue
7.28 Service;
7.29 (2) a person employed in subsidized on-the-job training,
7.30 work experience or public service employment as an enrollee
7.31 under the federal Comprehensive Employment and Training Act from
7.32 and after March 30, 1978, unless the person has, as of the later
7.33 of March 30, 1978, or the date of employment, sufficient service
7.34 credit in the retirement association to meet the minimum vesting
7.35 requirements for a deferred retirement annuity, or the employer
7.36 agrees in writing on forms prescribed by the executive director
8.1 to make the required employer contributions, including any
8.2 employer additional contributions, on account of that person
8.3 from revenue sources other than funds provided under the federal
8.4 Comprehensive Training and Employment Act, or the person agrees
8.5 in writing on forms prescribed by the executive director to make
8.6 the required employer contribution in addition to the required
8.7 employee contribution;
8.8 (3) a person holding a part-time adult supplementary
8.9 technical college license who renders part-time teaching service
8.10 or a customized trainer as defined by the Minnesota State
8.11 Colleges and Universities system in a technical college if (i)
8.12 the service is incidental to the regular nonteaching occupation
8.13 of the person; and (ii) the applicable technical college
8.14 stipulates annually in advance that the part-time teaching
8.15 service or customized training service will not exceed 300 hours
8.16 in a fiscal year and retains the stipulation in its records; and
8.17 (iii) the part-time teaching service or customized training
8.18 service actually does not exceed 300 hours in a fiscal year; or
8.19 (4) a person exempt from licensure under section 122A.30.
8.20 Sec. 3. Minnesota Statutes 2002, section 354.05,
8.21 subdivision 13, is amended to read:
8.22 Subd. 13. ALLOWABLE SERVICE. "Allowable service" means:
8.23 (1) Any service rendered by a teacher for which on or
8.24 before July 1, 1957, the teacher's account in the retirement
8.25 fund was credited by reason of employee contributions in the
8.26 form of salary deductions, payments in lieu of salary
8.27 deductions, or in any other manner authorized by Minnesota
8.28 Statutes 1953, sections 135.01 to 135.13, as amended by Laws
8.29 1955, chapters 361, 549, 550, 611, or
8.30 (2) Any service rendered by a teacher for which on or
8.31 before July 1, 1961, the teacher elected to obtain credit for
8.32 service by making payments to the fund pursuant to Minnesota
8.33 Statutes 1980, section 354.09 and section 354.51, or
8.34 (3) Any service rendered by a teacher after July 1, 1957,
8.35 for any calendar month when the member receives salary from
8.36 which deductions are made, deposited and credited in the fund,
9.1 or
9.2 (4) Any service rendered by a person after July 1, 1957,
9.3 for any calendar month where payments in lieu of salary
9.4 deductions are made, deposited and credited into the fund as
9.5 provided in Minnesota Statutes 1980, section 354.09, subdivision
9.6 4, and section 354.53, or
9.7 (5) Any service rendered by a teacher for which the teacher
9.8 elected to obtain credit for service by making payments to the
9.9 fund pursuant to Minnesota Statutes 1980, section 354.09,
9.10 subdivisions 1 and 4, sections 354.50, 354.51, Minnesota
9.11 Statutes 1957, section 135.41, subdivision 4, Minnesota Statutes
9.12 1971, section 354.09, subdivision 2, or Minnesota Statutes, 1973
9.13 Supplement, section 354.09, subdivision 3, or
9.14 (6) Both service during years of actual membership in the
9.15 course of which contributions were currently made and service in
9.16 years during which the teacher was not a member but for which
9.17 the teacher later elected to obtain credit by making payments to
9.18 the fund as permitted by any law then in effect, or
9.19 (7) Any service rendered where contributions were made and
9.20 no allowable service credit was established because of the
9.21 limitations contained in Minnesota Statutes 1957, section
9.22 135.09, subdivision 2, as determined by the ratio between the
9.23 amounts of money credited to the teacher's account in a fiscal
9.24 year and the maximum retirement contribution allowable for that
9.25 year, or
9.26 (8) A period purchased under section 356.555, or
9.27 (9) A period of time during which a teacher who is a state
9.28 employee was on strike without pay, not to exceed a period of
9.29 one year, if the teacher makes a payment in lieu of salary
9.30 deductions or makes a prior service credit purchase payment,
9.31 whichever applies. If the payment is made within 12 months, the
9.32 payment by the teacher must be an amount equal to the employee
9.33 and employer contribution rates set forth in section 354.42,
9.34 subdivisions 2 and 3, applied to the teacher's rate of salary in
9.35 effect on the conclusion of the strike for the period of the
9.36 strike without pay, plus compound interest at a monthly rate of
10.1 0.71 percent from the last day of the strike until the date of
10.2 payment. If the payment by the employee is not made within 12
10.3 months, the payment must be in an amount equal to the payment
10.4 amount determined under section 356.55 or 356.551, whichever
10.5 applies; or
10.6 (10) A period of service rendered by a teacher as an
10.7 employee of Special School District No. 1, Minneapolis, on
10.8 December 31, 2004, who was a member of the Minneapolis Teachers
10.9 Retirement Fund Association by virtue of that employment, who
10.10 has not begun receiving an annuity or other retirement benefit
10.11 from the former Minneapolis Teachers Retirement Fund Association
10.12 calculated in whole or in part on that service before July 1,
10.13 2004, and who has not taken a refund of member contributions
10.14 related to that service unless the refund is repaid under
10.15 section 354.50, subdivision 4.
10.16 Sec. 4. Minnesota Statutes 2002, section 354.42,
10.17 subdivision 2, is amended to read:
10.18 Subd. 2. EMPLOYEE. (a) The employee contribution to the
10.19 fund is an amount equal to the following percentage of the
10.20 salary of a member:
10.21 (1) from January 1, 2005, to December 31, 2006, for a
10.22 teacher employed by Special School District No. 1, 5.50 percent
10.23 if the teacher is a coordinated member and 9.00 percent of the
10.24 teacher is a basic member;
10.25 (2) after December 31, 2006, for a teacher employed by
10.26 Special School District No. 1, 5.00 percent if the teacher is a
10.27 coordinated member and 9.00 percent if the teacher is a basic
10.28 member;
10.29 (3) for every other teacher 5.0 percent of if the salary of
10.30 every teacher is a coordinated member and 9.0 percent of if the
10.31 salary of every teacher is a basic member.
10.32 (b) This contribution must be made by deduction from
10.33 salary. Where any portion of a member's salary is paid from
10.34 other than public funds, the member's employee contribution must
10.35 be based on the entire salary received.
10.36 Sec. 5. Minnesota Statutes 2002, section 354.42,
11.1 subdivision 3, is amended to read:
11.2 Subd. 3. EMPLOYER. (a) The employer contribution to the
11.3 fund by Special School District No. 1 is an amount equal to 8.64
11.4 percent of the salary of each of its teachers who is a
11.5 coordinated member and 12.64 percent of the salary of each of
11.6 its teachers who is a basic member.
11.7 (b) The employer contribution to the fund for every other
11.8 employer is an amount equal to 5.0 percent of the salary of each
11.9 coordinated member and 9.0 percent of the salary of each basic
11.10 member.
11.11 Sec. 6. 354.70 CONSOLIDATION OF THE MINNEAPOLIS
11.12 TEACHERS RETIREMENT FUND ASSOCIATION.
11.13 Subdivision 1. MEMBERSHIP TRANSFER. All active,
11.14 inactive, and retired members of the Minneapolis Teachers
11.15 Retirement Fund Association are transferred to the Teachers
11.16 Retirement Association and are no longer members of the
11.17 Minneapolis Teachers Retirement Fund Association as of the
11.18 effective date of this section.
11.19 Subd. 2. TRA MEMBERSHIP. A person first hired as a
11.20 teacher by Special School District No. 1, Minneapolis, after the
11.21 effective date of this section and who is a teacher as defined
11.22 in section 354.05, subdivision 2, is a member of the Teachers
11.23 Retirement Association for the person's teaching service.
11.24 Subd. 3. SERVICE CREDIT AND LIABILITY TRANSFER. All
11.25 allowable service and salary credit of the members and other
11.26 individuals transferred under subdivision 1 as specified in the
11.27 records of the Minneapolis Teachers Retirement Fund Association
11.28 on the transfer date is allowable service credit under section
11.29 354.05, subdivision 13, formula service credit under section
11.30 354.05, subdivision 25, and salary credit under section 354.05,
11.31 subdivision 35, for the Teachers Retirement Association.
11.32 Subd. 4. TRANSFER OF RECORDS. On the effective date of
11.33 this section, the chief administrative officer of the
11.34 Minneapolis Teachers Retirement Fund Association shall effect a
11.35 transfer of all records and documents relating to the funds and
11.36 the benefit plans of the association to the executive director
12.1 of the Teachers Retirement Association. To the extent possible,
12.2 original copies of all records and documents must be transferred.
12.3 Subd. 5. TRANSFER OF ASSETS. (a) On the effective date
12.4 of this section, the chief administrative officer of the
12.5 Minneapolis Teachers Retirement Fund Association shall transfer
12.6 to the Teachers Retirement Association the entire assets of the
12.7 Minneapolis Teachers Retirement Fund Association. The transfer
12.8 of the assets of the Minneapolis Teachers Retirement Fund
12.9 Association must include any accounts receivable that are
12.10 determined by the executive director of the State Board of
12.11 Investment as reasonably capable of being collected. Legal
12.12 title to account receivables that are determined by the
12.13 executive director of the State Board of Investment as not
12.14 reasonably capable of being collected transfers to Special
12.15 School District No. 1, Minneapolis, as of the date of the
12.16 determination of the executive director of the State Board of
12.17 Investment. If the account receivables transferred to Special
12.18 School District No. 1, Minneapolis, are subsequently recovered
12.19 by the school district, Special School District No. 1,
12.20 Minneapolis, shall transfer the recovered amount to the Teachers
12.21 Retirement Association, in cash, for deposit in the teachers
12.22 retirement fund, less the reasonable expenses of the school
12.23 district related to the recovery.
12.24 (b) As of the effective date of this section, subject to
12.25 the authority of the State Board of Investment, the board of
12.26 directors of the Teachers Retirement Association has legal title
12.27 to and management responsibility for any transferred assets
12.28 under this subdivision as trustees for any person having a
12.29 beneficial interest in the Minneapolis Teachers Retirement Fund
12.30 Association. The Teachers Retirement Association is the
12.31 successor in interest for all claims for and against the former
12.32 Minneapolis Teachers Retirement Fund Association with respect to
12.33 the retirement fund association, except a claim against the
12.34 Minneapolis Teachers Retirement Fund Association or any person
12.35 connected with the fund association in a fiduciary capacity,
12.36 based on any act or acts by that person which were not done in
13.1 good faith and which constituted a breach of the obligation of
13.2 the person as a fiduciary. As the successor in interest, the
13.3 Teachers Retirement Association may assert any applicable
13.4 defense in any judicial proceeding which the board of the
13.5 Minneapolis Teachers Retirement Fund Association would have
13.6 otherwise been entitled to assert.
13.7 (c) From the assets of the former Minneapolis Teachers
13.8 Retirement Fund Association transferred to the Teachers
13.9 Retirement Association, an amount equal to 76.26 percent of the
13.10 percent value of future benefits payable to annuitants as of
13.11 June 30, 2004, must be transferred to the Minnesota
13.12 postretirement investment fund. The balance of the assets of
13.13 the former Minneapolis Teachers Retirement Fund Association
13.14 after the transfer to the Minnesota postretirement investment
13.15 fund must be credited to the Teachers Retirement Association.
13.16 Subd. 6. TERMINATION OF THE MINNEAPOLIS TEACHERS