LCPR05-216

  1.1     M ............... moves to amend S.F. No. ....; H.F. No.

  1.2  ...., as follows:

  1.3     Delete everything after the enacting clause and insert:

  1.4                   "2005 OMNIBUS RETIREMENT BILL

  1.5                             ARTICLE 1

  1.6                  CLARIFICATION/RECODIFICATION OF

  1.7                STATEWIDE SPECIALTY RETIREMENT PLANS

  1.8     Section 1.  Minnesota Statutes 2004, section 3A.01,

  1.9  subdivision 1, is amended to read:

  1.10    Subdivision 1.  PURPOSES. Each of the terms defined in

  1.11 this section, for the purposes of this chapter shall be

  1.12 given has the meanings meaning ascribed to them.

  1.13    Sec. 2.  Minnesota Statutes 2004, section 3A.01, is amended

  1.14 by adding a subdivision to read:

  1.15    Subd. 1a.  ACTUARIAL EQUIVALENT. "Actuarial equivalent"

  1.16 means the condition of one allowance or benefit having an equal

  1.17 actuarial present value to another allowance or benefit,

  1.18 determined by the actuary retained under section 356.214 as of a

  1.19 given date at a specified age with each actuarial present value

  1.20 based on the mortality table applicable for the plan and

  1.21 approved under section 356.215, subdivision 18, and using the

  1.22 applicable preretirement or postretirement interest rate

  1.23 assumption specified in section 356.215, subdivision 8.

  1.24    Sec. 3.  Minnesota Statutes 2004, section 3A.01, is amended

  1.25 by adding a subdivision to read:

  1.26    Subd. 1b.  AVERAGE MONTHLY SALARY. "Average monthly

  1.27 salary" means the average of the member's highest five

  1.28 successive years of salary that was received as a member of the

  1.29 legislature and upon which the member has made contributions

  1.30 under section 3A.03, subdivision 1, or for which the member of

  1.31 the legislature has made payments for past service under section

  1.32 3A.02, subdivision 2, or has made, before July 1, 1994, payments

  1.33 in lieu of contributions under Minnesota Statutes 1992, section

  1.34 3A.031.

  1.35    Sec. 4.  Minnesota Statutes 2004, section 3A.01, is amended

  1.36 by adding a subdivision to read:

  2.1     Subd. 1c.  CONSTITUTIONAL OFFICER. "Constitutional

  2.2  officer" means a person who was duly elected, qualifies for, and

  2.3  serves as the governor, the lieutenant governor, the attorney

  2.4  general, the secretary of state, or the state auditor of the

  2.5  state of Minnesota.

  2.6     Sec. 5.  Minnesota Statutes 2004, section 3A.01,

  2.7  subdivision 2, is amended to read:

  2.8     Subd. 2.  DEPENDENT CHILD. (a) "Dependent child" means

  2.9  any natural or adopted child of a deceased member of the

  2.10 legislature or a former legislator who is under the age of 18,

  2.11 or who is under the age of 22 and is a full‑time student, and

  2.12 who, in either case, is unmarried and was actually dependent for

  2.13 more than one‑half of support upon such the legislator for a

  2.14 period of at least 90 days immediately prior to before the

  2.15 legislator's death.  It

  2.16    (b) The term also includes any child of the member of the

  2.17 legislature or former legislator who was conceived during the

  2.18 lifetime of, and who was born after the death of, the member or

  2.19 former legislator.  This subdivision shall be retroactive as to

  2.20 any dependent child under the age of 22 years as of April 1,

  2.21 1975.

  2.22    Sec. 6.  Minnesota Statutes 2004, section 3A.01,

  2.23 subdivision 6, is amended to read:

  2.24    Subd. 6.  DIRECTOR. "Director" means the executive

  2.25 director of the Minnesota State Retirement System who was

  2.26 appointed under section 352.03, subdivision 5.

  2.27    Sec. 7.  Minnesota Statutes 2004, section 3A.01, is amended

  2.28 by adding a subdivision to read:

  2.29    Subd. 6b.  FORMER LEGISLATOR. "Former legislator" means a

  2.30 legislator who has ceased to be a member of the legislature for

  2.31 any reason, including, but not limited to, the expiration of the

  2.32 term for which a member of the legislature was elected or the

  2.33 death of the member.

  2.34    Sec. 8.  Minnesota Statutes 2004, section 3A.01, is amended

  2.35 by adding a subdivision to read:

  2.36    Subd. 6c.  MEMBER OF THE LEGISLATURE. "Member of the

  3.1  legislature" means a person who was a member of the House of

  3.2  Representatives or of the Senate of the state of Minnesota who

  3.3  has subscribed to the oath of office after July 1, 1965, and who

  3.4  was first elected to a legislative office before July 1, 1997,

  3.5  and retained coverage by the plan under Laws 1997, chapter 233,

  3.6  article 2, section 15.

  3.7     Sec. 9.  Minnesota Statutes 2004, section 3A.01,

  3.8  subdivision 8, is amended to read:

  3.9     Subd. 8.  NORMAL RETIREMENT AGE. "Normal retirement age"

  3.10 means the age of 60 years with regard to any member of the

  3.11 legislature whose service terminates prior to the beginning of

  3.12 the 1981 legislative session, and the age of 62 years with

  3.13 regard to any member of the legislature whose service terminates

  3.14 after the beginning of the 1981 session.

  3.15    Sec. 10.  Minnesota Statutes 2004, section 3A.01, is

  3.16 amended by adding a subdivision to read:

  3.17    Subd. 9.  RETIREMENT. "Retirement" means the period of

  3.18 time after which a former legislator is entitled to a retirement

  3.19 allowance.

  3.20    Sec. 11.  Minnesota Statutes 2004, section 3A.01, is

  3.21 amended by adding a subdivision to read:

  3.22    Subd. 10.  SALARY. (a) "Salary" means the regular

  3.23 compensation payable under law to a member of the legislature

  3.24 and paid to the person for service as a legislator.

  3.25    (b) The term includes the monthly compensation paid to the

  3.26 member of the legislature and the per diem payments paid during

  3.27 a regular or special session to the member of the legislature.

  3.28    (c) The term does not include per diem payments paid to a

  3.29 member of the legislature other than during the regular or

  3.30 special session; additional compensation attributable to a

  3.31 leadership position under section 3.099, subdivision 3; living

  3.32 expense payments under section 3.101; and special session living

  3.33 expense payments under section 3.103.

  3.34    Sec. 12.  Minnesota Statutes 2004, section 3A.011, is

  3.35 amended to read:

  3.36    3A.011 ADMINISTRATION OF PLAN.

  4.1     The executive director and the board of directors of the

  4.2  Minnesota State Retirement System shall administer the

  4.3  legislators retirement plan in accordance with this chapter and

  4.4  chapter 356A.

  4.5     Sec. 13.  Minnesota Statutes 2004, section 3A.02,

  4.6  subdivision 1, is amended to read:

  4.7     Subdivision 1.  QUALIFICATIONS. (a) A former legislator

  4.8  is entitled, upon written application to the director, to

  4.9  receive a retirement allowance monthly, if the person:

  4.10    (1) has either served at least six full years, without

  4.11 regard to the application of section 3A.10, subdivision 2, or

  4.12 has served during all or part of four regular sessions as a

  4.13 member of the legislature, which service need not be continuous;

  4.14    (2) has attained the normal retirement age;

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

  4.16    (4) has made all contributions provided for in section

  4.17 3A.03, has made payments for past service under subdivision 2,

  4.18 or has made payments in lieu of contributions under Minnesota

  4.19 Statutes 1992, section 3A.031, prior to before July 1, 1994.

  4.20    (b) This paragraph applies to members of the legislature

  4.21 who terminate service as a legislator before July 1, 1997.  For

  4.22 service rendered before the beginning of the 1979 legislative

  4.23 session, but not to exceed eight years of service, the

  4.24 retirement allowance is an amount equal to five percent per year

  4.25 of service of that member's average monthly salary.  For service

  4.26 in excess of eight years rendered before the beginning of the

  4.27 1979 legislative session, and for service rendered after the

  4.28 beginning of the 1979 legislative session, Unless the former

  4.29 legislator has legislative service before January 1, 1979, the

  4.30 retirement allowance is an amount equal to 2‑1/2 percent per

  4.31 year of service of that member's average monthly salary.

  4.32    (c) This paragraph applies to members of the legislature

  4.33 who terminate service as a legislator after June 30, 1997.  The

  4.34 retirement allowance is an amount equal to the applicable rate

  4.35 or rates under paragraph (b) per year of service of the member's

  4.36 average monthly salary and adjusted for that person on an

  5.1  actuarial equivalent basis to reflect the change in the

  5.2  postretirement interest rate actuarial assumption under section

  5.3  356.215, subdivision 8, from five percent to six percent.  The

  5.4  adjustment must be calculated by or, alternatively, the

  5.5  adjustment procedure must be specified by, the actuary retained

  5.6  by the Legislative Commission on Pensions and Retirement under

  5.7  section 356.214.  The purpose of this adjustment is to ensure

  5.8  that the total amount of benefits that the actuary predicts an

  5.9  individual member will receive over the member's lifetime under

  5.10 this paragraph will be the same as the total amount of benefits

  5.11 the actuary predicts the individual member would receive over

  5.12 the member's lifetime under the law in effect before enactment

  5.13 of this paragraph.  If the former legislator has legislative

  5.14 service before January 1, 1979, the person's benefit must

  5.15 include the additional benefit amount in effect on January 1,

  5.16 1979, and adjusted as otherwise provided in this paragraph.

  5.17    (d) (c) The retirement allowance accrues beginning with the

  5.18 first day of the month of receipt of the application, but not

  5.19 before age 60, and for the remainder of the former legislator's

  5.20 life, if the former legislator is not serving as a member of the

  5.21 legislature or as a constitutional officer or commissioner as

  5.22 defined in section 352C.021, subdivisions 2 and 3 subdivision 1b.

  5.23 The annuity does not begin to accrue prior to before the

  5.24 person's retirement as a legislator.  No annuity payment may be

  5.25 made retroactive for more than 180 days before the date that the

  5.26 annuity application is filed with the director.

  5.27    (e) (d) Any member who has served during all or part of

  5.28 four regular sessions is considered to have served eight years

  5.29 as a member of the legislature.

  5.30    (f) (e) The retirement allowance ceases with the last

  5.31 payment that accrued to the retired legislator during the

  5.32 retired legislator's lifetime, except that the surviving spouse,

  5.33 if any, is entitled to receive the retirement allowance of the

  5.34 retired legislator for the calendar month in which the retired

  5.35 legislator died.

  5.36    Sec. 14.  Minnesota Statutes 2004, section 3A.02,

  6.1  subdivision 1b, is amended to read:

  6.2     Subd. 1b.  REDUCED RETIREMENT ALLOWANCE. (a) Upon

  6.3  separation from service after the beginning of the 1981

  6.4  legislative session, a former member of the legislature who has

  6.5  attained the age set by the board of directors of the Minnesota

  6.6  State Retirement System and who is otherwise qualified in

  6.7  accordance with under subdivision 1 is entitled, upon making

  6.8  written application on forms supplied a form prescribed by the

  6.9  director, to a reduced retirement allowance in.  The reduced

  6.10 retirement allowance is an amount equal to the retirement

  6.11 allowance specified in subdivision 1, paragraph (b), that is

  6.12 reduced so that the reduced annuity allowance is the actuarial

  6.13 equivalent of the annuity allowance that would be payable if the

  6.14 former member of the legislature deferred receipt of the annuity

  6.15 allowance and the annuity allowance amount were was augmented

  6.16 at an annual rate of three percent compounded annually from the

  6.17 date the annuity allowance begins to accrue until age 62.

  6.18    (b) The age set by the board of directors under paragraph

  6.19 (a) cannot be less an earlier age than the early retirement age

  6.20 under section 352.116, subdivision 1a.

  6.21    (c) If there is an actuarial cost to the plan of resetting

  6.22 the early retirement age under paragraph (a), the retired

  6.23 legislator is required to pay an additional amount to cover the

  6.24 full actuarial value.  The additional amount must be paid in a

  6.25 lump sum within 30 days of the certification of the amount by

  6.26 the executive director. 

  6.27    (d) The executive director of the Minnesota State

  6.28 Retirement System shall report to the Legislative Commission on

  6.29 Pensions and Retirement on the utilization of this

  6.30 provision annually on or before September 1, 2000.

  6.31    Sec. 15.  Minnesota Statutes 2004, section 3A.02,

  6.32 subdivision 3, is amended to read:

  6.33    Subd. 3.  APPROPRIATION. The amounts required for payment

  6.34 of retirement allowances provided by this section are

  6.35 appropriated annually to the director from the participation of

  6.36 the legislators retirement plan in the Minnesota postretirement

  7.1  investment fund and shall.  The retirement allowance must be

  7.2  paid monthly to the recipients entitled thereto to those

  7.3  retirement allowances.

  7.4     Sec. 16.  Minnesota Statutes 2004, section 3A.02,

  7.5  subdivision 4, is amended to read:

  7.6     Subd. 4.  DEFERRED ANNUITIES AUGMENTATION. (a) The

  7.7  deferred annuity retirement allowance of any former legislator

  7.8  must be augmented as provided herein. 

  7.9     (b) The required reserves applicable to the

  7.10 deferred annuity retirement allowance, determined as of the date

  7.11 the benefit begins to accrue using an appropriate mortality

  7.12 table and an interest assumption of six percent, must be

  7.13 augmented from the first of the month following the termination

  7.14 of active service, or July 1, 1973, whichever is later, to the

  7.15 first day of the month in which the annuity allowance begins to

  7.16 accrue, at the following annually compounded rate of or rates:

  7.17    five percent per annum compounded annually until January 1,

  7.18 1981, and thereafter at the rate of three percent per annum

  7.19 compounded annually until January 1 of the year in which the

  7.20 former legislator attains age 55.  From that date to the

  7.21 effective date of retirement, the rate is five percent

  7.22 compounded annually.

  7.23         rate                   period

  7.24      (1) five percent     until January 1, 1981

  7.25      (2) three percent    from January 1, 1981, or from the

  7.26                           first day of the month following

  7.27                           the termination of active service,

  7.28                           whichever is later, until January 1

  7.29                           of the year in which the former

  7.30                           legislator attains age 55

  7.32      (3) five percent     from the period end date under

  7.33                           clause (2) to the effective date

  7.34                           of retirement.

  7.35    (b) The retirement allowance of, or the survivor benefit

  7.36 payable on behalf of, a former member of the legislature who

  8.1  terminated service before July 1, 1997, which is not first

  8.2  payable until after June 30, 1997, must be increased on an

  8.3  actuarial equivalent basis to reflect the change in the

  8.4  postretirement interest rate actuarial assumption under section

  8.5  356.215, subdivision 8, from five percent to six percent under a

  8.6  calculation procedure and tables adopted by the board of

  8.7  directors of the Minnesota State Retirement System and approved

  8.8  by the actuary retained by the Legislative Commission on

  8.9  Pensions and Retirement.

  8.10    Sec. 17.  Minnesota Statutes 2004, section 3A.02,

  8.11 subdivision 5, is amended to read:

  8.12    Subd. 5.  OPTIONAL ANNUITIES. (a) The board of directors

  8.13 shall establish an optional retirement annuity in the form of a

  8.14 joint and survivor annuity and an optional retirement annuity in

  8.15 the form of a period certain and life thereafter.  Except as

  8.16 provided in paragraph (b), these optional annuity forms must be

  8.17 actuarially equivalent to the normal annuity allowance computed

  8.18 under this section, plus the actuarial value of any surviving

  8.19 spouse benefit otherwise potentially payable at the time of

  8.20 retirement under section 3A.04, subdivision 1.  An individual

  8.21 selecting an optional annuity under this subdivision waives and

  8.22 the person's spouse waive any rights to surviving spouse

  8.23 benefits under section 3A.04, subdivision 1.

  8.24    (b) If a retired legislator selects the joint and survivor

  8.25 annuity option, the retired legislator must receive a normal

  8.26 single‑life annuity allowance if the designated optional annuity

  8.27 beneficiary dies before the retired legislator and no reduction

  8.28 may be made in the annuity to provide for restoration of the

  8.29 normal single‑life annuity allowance in the event of the death

  8.30 of the designated optional annuity beneficiary.

  8.31    (c) The surviving spouse of a legislator who has attained

  8.32 at least age 60 and who dies while a member of the legislature

  8.33 may elect an optional joint and survivor annuity under paragraph

  8.34 (a), in lieu of surviving spouse benefits under section 3A.04,

  8.35 subdivision 1.

  8.36    Sec. 18.  Minnesota Statutes 2004, section 3A.03,

  9.1  subdivision 1, is amended to read:

  9.2     Subdivision 1.  PERCENTAGE. (a) Every member of the

  9.3  legislature shall contribute nine percent of total salary,.

  9.4     (b) The contribution must be made by payroll deduction,

  9.5  to and must be paid into the state treasury and deposited in the

  9.6  general fund.  It shall be the duty of

  9.7     (c) The director to must record the periodic contributions

  9.8  of each member of the legislature and must credit such each

  9.9  contribution to the member's account.

  9.10    Sec. 19.  Minnesota Statutes 2004, section 3A.03,

  9.11 subdivision 2, is amended to read:

  9.12    Subd. 2.  REFUND. (a) A former member who has made

  9.13 contributions under subdivision 1 and who is no longer a member

  9.14 of the legislature is entitled to receive, upon written

  9.15 application to the executive director on a form prescribed by

  9.16 the executive director, a refund from the general fund of all

  9.17 contributions credited to the member's account with interest

  9.18 computed as provided in section 352.22, subdivision 2.