LCPR05-307
1.1 M ............... moves to amend S.F. No. 1057; H.F. 1120,
1.2 as follows:
1.3 Delete everything after the enacting clause and insert:
1.4 "ARTICLE 1
1.5 VARIOUS RETIREMENT PLAN CONTRIBUTION
1.6 RATE INCREASES
1.7 Section 1. Minnesota Statutes 2004, section 352.04,
1.8 subdivision 2, is amended to read:
1.9 Subd. 2. EMPLOYEE CONTRIBUTIONS. The employee
1.10 contribution to the fund must be equal to 4.0 percent of
1.11 salary. Beginning on July 1, 2007, the employee contribution
1.12 must be equal to 4.25 percent of salary. Beginning on July 1,
1.13 2008, the employee contribution must be equal to 4.50 percent of
1.14 salary. Beginning on July 1, 2009, the employee contribution
1.15 must be equal to 4.75 percent of salary. Beginning on July 1,
1.16 2010, the employee contribution must be equal to 5.0 percent of
1.17 salary. These contributions must be made by deduction from
1.18 salary as provided in subdivision 4.
1.19 Sec. 2. Minnesota Statutes 2004, section 352.04,
1.20 subdivision 3, is amended to read:
1.21 Subd. 3. EMPLOYER CONTRIBUTIONS. The employer
1.22 contribution to the fund must be equal to 4.0 percent of
1.23 salary. Beginning on July 1, 2007, the employer contribution
1.24 must be equal to 4.25 percent of salary. Beginning on July 1,
1.25 2008, the employer contribution must be equal to 4.50 percent of
1.26 salary. Beginning on July 1, 2009, the employer contribution
1.27 must be equal to 4.75 percent of salary. Beginning on July 1,
1.28 2010, the employer contribution must be equal to 5.0 percent of
1.29 salary.
1.30 Sec. 3. Minnesota Statutes 2004, section 352.92,
1.31 subdivision 1, is amended to read:
1.32 Subdivision 1. EMPLOYEE CONTRIBUTIONS. Employee
1.33 contributions of covered correctional employees must be in an
1.34 amount equal to 5.69 a percent of salary. Beginning July 1,
1.35 2007, through June 30, 2008, the employee contribution must be
1.36 equal to 6.4 percent of salary. Beginning July 1, 2008, through
2.1 June 30, 2009, the employee contribution must be equal to 7.0
2.2 percent of salary. Beginning July 1, 2009, through June 30,
2.3 2010, the employee contribution must be equal to 7.7 percent of
2.4 salary. Beginning July 1, 2010, the ongoing employee
2.5 contribution must be equal to 8.6 percent of salary.
2.6 Sec. 4. Minnesota Statutes 2004, section 352.92,
2.7 subdivision 2, is amended to read:
2.8 Subd. 2. EMPLOYER CONTRIBUTIONS. The employer shall
2.9 contribute for covered correctional employees an amount equal to
2.10 7.98 a percent of salary. Beginning July 1, 2007, through June
2.11 30, 2008, the employer contribution must be equal to 9.1 percent
2.12 of salary. Beginning July 1, 2008, through June 30, 2009, the
2.13 employer contribution must be equal to 10.1 percent of salary.
2.14 Beginning July 1, 2009, through June 30, 2010, the employer
2.15 contribution must be equal to 11.1 percent of salary. Beginning
2.16 July 1, 2010, the ongoing employer contribution must be equal to
2.17 12.1 percent of salary.
2.18 Sec. 5. Minnesota Statutes 2004, section 352B.02,
2.19 subdivision 1a, is amended to read:
2.20 Subd. 1a. MEMBER CONTRIBUTIONS. Each member shall pay a
2.21 sum equal to 8.40 a percent of the member's salary, which shall
2.22 constitute the member contribution to the fund. Beginning July
2.23 1, 2007, through June 30, 2008, each member contribution shall
2.24 be equal to 9.1 percent of salary. Beginning July 1, 2008, the
2.25 ongoing member contribution amount shall be equal to 9.8 percent
2.26 of salary.
2.27 Sec. 6. Minnesota Statutes 2004, section 352B.02,
2.28 subdivision 1c, is amended to read:
2.29 Subd. 1c. EMPLOYER CONTRIBUTIONS. In addition to member
2.30 contributions, department heads shall pay a sum equal to 12.60 a
2.31 percent of the salary upon which deductions were made, which
2.32 shall constitute the employer contribution to the fund.
2.33 Beginning July 1, 2007, through June 30, 2008, the employer
2.34 contribution shall be equal to 13.6 percent of salary.
2.35 Beginning July 1, 2008, the ongoing employer contribution amount
2.36 shall be equal to 14.6 percent of salary. Department
3.1 contributions must be paid out of money appropriated to
3.2 departments for this purpose.
3.3 Sec. 7. Minnesota Statutes 2004, section 352D.04,
3.4 subdivision 2, is amended to read:
3.5 Subd. 2. CONTRIBUTION RATES. (a) The money used to
3.6 purchase shares under this section is the employee and employer
3.7 contributions provided in this subdivision.
3.8 (b) The employee contribution is an amount equal to the
3.9 employee contribution specified in section 352.04, subdivision 2
3.10 four percent of salary.
3.11 (c) The employer contribution is an amount equal to six
3.12 percent of salary.
3.13 (d) These contributions must be made in the manner provided
3.14 in section 352.04, subdivisions 4, 5, and 6.
3.15 (e) For members of the legislature, the contributions under
3.16 this subdivision also must be made on per diem payments received
3.17 during a regular or special legislative session, but may not be
3.18 made on per diem payments received outside of a regular or
3.19 special legislative session, on the additional compensation
3.20 attributable to a leadership position under section 3.099,
3.21 subdivision 3, living expense payments under section 3.101, or
3.22 special session living expense payments under section 3.103.
3.23 (f) For a judge who is a member of the unclassified plan
3.24 under section 352D.02, subdivision 1, paragraph (c), clause
3.25 (16), the employee contribution rate is eight percent of salary,
3.26 and there is no employer contribution.
3.27 Sec. 8. Minnesota Statutes 2004, section 353.27,
3.28 subdivision 2, is amended to read:
3.29 Subd. 2. EMPLOYEE CONTRIBUTION. (a) The employee
3.30 contribution is the following applicable percentage of the total
3.31 salary amount for a "basic member" and for a "coordinated
3.32 member":
3.33 Basic Coordinated
3.34 Program Program
3.35 Before January 1, 2002 8.75 4.75
3.36 Effective January 1, 2002
4.1 Effective before January 1, 2006 9.10 5.10
4.2 Effective January 1, 2006 9.10 5.50
4.3 Effective January 1, 2007 9.10 5.75
4.4 Effective January 1, 2008 9.10 6.00 plus any
4.5 contribution
4.6 rate adjustment
4.7 under
4.8 subdivision 3b
4.9 (b) These contributions must be made by deduction from
4.10 salary as defined in section 353.01, subdivision 10, in the
4.11 manner provided in subdivision 4. Where If any portion of a
4.12 member's salary is paid from other than public funds, such the
4.13 member's employee contribution must be based on the total salary
4.14 received by the member from all sources.
4.15 Sec. 9. Minnesota Statutes 2004, section 353.27,
4.16 subdivision 3, is amended to read:
4.17 Subd. 3. EMPLOYER CONTRIBUTION. (a) The employer
4.18 contribution is the following applicable percentage of the total
4.19 salary amount for "basic members" and for "coordinated members":
4.20 Basic Coordinated
4.21 Program Program
4.22 Before January 1, 2002 8.75 4.75
4.23 Effective January 1, 2002
4.24 Effective before January 1, 2006 9.10 5.10
4.25 Effective January 1, 2006 9.10 5.50
4.26 Effective January 1, 2007 9.10 5.75
4.27 Effective January 1, 2008 9.10 6.00 plus any
4.28 contribution
4.29 rate adjustment
4.30 under
4.31 subdivision 3b
4.32 (b) This contribution must be made from funds available to
4.33 the employing subdivision by the means and in the manner
4.34 provided in section 353.28.
4.35 Sec. 10. Minnesota Statutes 2004, section 353.27,
4.36 subdivision 3a, is amended to read:
5.1 Subd. 3a. ADDITIONAL EMPLOYER CONTRIBUTION. (a) An
5.2 additional employer contribution must be made equal to (1) 2.68
5.3 percent of the following applicable percentage of the total
5.4 salary of each amount for "basic member members"; and (2)
5.5 .43 percent of the total salary of each for "coordinated member.
5.6 members":
5.7 Basic Coordinated
5.8 Program Program
5.9 Effective before January 1, 2006 2.68 .43
5.10 Effective January 1, 2006 2.68 .50
5.11 Effective January 1, 2009 2.68 .75
5.12 Effective January 1, 2010 2.68 1.00
5.13 These contributions must be made from funds available to
5.14 the employing subdivision by the means and in the manner
5.15 provided in section 353.28.
5.16 (b) The coordinated program contribution rates set forth in
5.17 paragraph (a) effective for January 1, 2009, or January 1, 2010,
5.18 must not be implemented if, following receipt of the July 1,
5.19 2008, or July 1, 2009, annual actuarial valuation reports under
5.20 section 356.215, respectively, the actuarially required
5.21 contributions are equal to or less than the total rates under
5.22 this section in effect as of January 1, 2008.
5.23 (c) This subdivision is repealed once the actuarial value
5.24 of the assets of the plan equal or exceed the actuarial accrued
5.25 liability of the plan as determined by the actuary retained by
5.26 the Legislative Commission on Pensions and Retirement under
5.27 section 356.215. The repeal is effective on the first day of
5.28 the first full pay period occurring after March 31 of the
5.29 calendar year following the issuance of the actuarial valuation
5.30 upon which the repeal is based.
5.31 Sec. 11. Minnesota Statutes 2004, section 353.27, is
5.32 amended by adding a subdivision to read:
5.33 Subd. 3b. CHANGE IN EMPLOYEE AND EMPLOYER CONTRIBUTIONS
5.34 IN CERTAIN INSTANCES. (a) For purposes of this section, a
5.35 contribution sufficiency exists if the total of the employee
5.36 contribution under subdivision 2, the employer contribution
6.1 under subdivision 3, the additional employer contribution under
6.2 subdivision 3a, and any additional contribution previously
6.3 imposed under this subdivision exceeds the total of the normal
6.4 cost, the administrative expenses, and the amortization
6.5 contribution of the retirement plan as reported in the most
6.6 recent actuarial valuation of the retirement plan prepared by
6.7 the actuary retained under section 356.214 and prepared under
6.8 section 356.215 and the standards for actuarial work of the
6.9 Legislative Commission on Pensions and Retirement. For purposes
6.10 of this section, a contribution deficiency exists if the total
6.11 of the employee contributions under subdivision 2, the employer
6.12 contributions under subdivision 3, the additional employer
6.13 contribution under subdivision 3a, and any additional
6.14 contribution previously imposed under this subdivision is less
6.15 than the total of the normal cost, the administrative expenses,
6.16 and the amortization contribution of the retirement plan as
6.17 reported in the most recent actuarial valuation of the
6.18 retirement plan prepared by the actuary retained under section
6.19 356.214 and prepared under section 356.215 and the standards for
6.20 actuarial work of the Legislative Commission on Pensions and
6.21 Retirement.
6.22 (b) Employee and employer contributions under subdivisions
6.23 2 and 3 must be adjusted:
6.24 (1) if, after July 1, 2010, the regular actuarial
6.25 valuations of the general employees retirement plan of the
6.26 Public Employees Retirement Association under section 356.215
6.27 indicate that there is a contribution sufficiency under
6.28 paragraph (a) equal to or greater than 0.5 percent of covered
6.29 payroll for two consecutive years, the coordinated program
6.30 employee and employer contribution rates must be decreased as
6.31 determined under paragraph (c) to a level such that the
6.32 sufficiency equals no more than 0.25 percent of covered payroll
6.33 based on the most recent actuarial valuation; or
6.34 (2) if, after July 1, 2010, the regular actuarial
6.35 valuations of the general employees retirement plan of the
6.36 Public Employees Retirement Association under section 356.215
7.1 indicate that there is a deficiency equal to or greater than 0.5
7.2 percent of covered payroll for two consecutive years, the
7.3 coordinated program employee and employer contribution rates
7.4 must be increased as determined under paragraph (c) to a level
7.5 such that no deficiency exists based on the most recent
7.6 actuarial valuation.
7.7 (c) The contribution rate increase or decrease must be
7.8 determined by the executive director of the Public Employees
7.9 Retirement Association, must be reported to the chair and the
7.10 executive director of the Legislative Commission on Pensions and
7.11 Retirement on or before the next February 1, and, if the
7.12 Legislative Commission on Pensions and Retirement does not
7.13 recommend against the rate change or does not recommend a
7.14 modification in the rate change, is effective on the next July 1
7.15 following the determination by the executive director that a
7.16 contribution deficiency or sufficiency has existed for two
7.17 consecutive fiscal years based on the most recent actuarial
7.18 valuations under section 356.215. If the actuarially required
7.19 contribution exceeds or is less than the total support provided
7.20 by the combined employee and employer contribution rates by more
7.21 than 0.5 percent of covered payroll, the coordinated program
7.22 employee and employer contribution rates must be adjusted
7.23 incrementally over one or more years to a level such that there
7.24 remains a contribution sufficiency of no more than 0.25 percent
7.25 of covered payroll.
7.26 (d) No incremental adjustment may exceed 0.25 percent for
7.27 either the coordinated program employee and employer
7.28 contribution rates per year in which any adjustment is
7.29 implemented. A contribution rate adjustment under this
7.30 subdivision must not be made until at least two years have
7.31 passed since fully implementing a previous adjustment under this
7.32 subdivision.
7.33 Sec. 12. Minnesota Statutes 2004, section 353.65,
7.34 subdivision 2, is amended to read:
7.35 Subd. 2. EMPLOYEE CONTRIBUTION RATE. (a) The employee
7.36 contribution is an amount equal to 6.2 the percent of the total
8.1 salary of the member specified in paragraph (b). This
8.2 contribution must be made by deduction from salary in the manner
8.3 provided in subdivision 4. Where any portion of a member's
8.4 salary is paid from other than public funds, the member's
8.5 employee contribution is based on the total salary received from
8.6 all sources.
8.7 (b) For calendar year 2006, the employee contribution rate
8.8 is 7.0 percent. For calendar year 2007, the employee
8.9 contribution rate is 7.8 percent. For calendar year 2008, the
8.10 employee contribution rate is 8.6 percent. For calendar year
8.11 2009 and thereafter, the employee contribution rate is 9.4
8.12 percent.
8.13 Sec. 13. Minnesota Statutes 2004, section 353.65,
8.14 subdivision 3, is amended to read:
8.15 Subd. 3. EMPLOYER CONTRIBUTION RATE. (a) The employer
8.16 contribution shall be an amount equal to 9.3 the percent of the
8.17 total salary of every member as specified in paragraph (b).
8.18 This contribution shall be made from funds available to the
8.19 employing subdivision by the means and in the manner provided in
8.20 section 353.28.
8.21 (b) For calendar year 2006, the employer contribution rate
8.22 is 10.5 percent. For calendar year 2007, the employer
8.23 contribution rate is 11.7 percent. For calendar year 2008, the
8.24 employer contribution rate is 12.9 percent. For calendar year
8.25 2009 and thereafter, the employer contribution rate is 14.1
8.26 percent.
8.27 Sec. 14. EFFECTIVE DATE.
8.28 (a) Sections 1, 2, and 7 are effective on July 1, 2007.
8.29 (b) Sections 3 to 6 are effective on July 1, 2005.
8.30 (c) Sections 8 to 13 are effective on January 1, 2006.
8.31 ARTICLE 2
8.32 TEACHER RETIREMENT FUND AND
8.33 BENEFIT RESTRUCTURING
8.34 Section 1. 126C.458 LEVY FOR EARLY RETIREMENT COSTS.
8.35 Each year, a school district may levy for the additional
8.36 employer contributions required under section 354.42,
9.1 subdivision 3.
9.2 Sec. 2. 128D.18 FUNDING OF UNFUNDED PENSION
9.3 LIABILITIES.
9.4 Subdivision 1. FINANCING AUTHORITY. Notwithstanding any
9.5 other law to the contrary, Special School District No. 1,
9.6 Minneapolis, may finance all or a portion of the current and
9.7 future unfunded actuarial accrued liability of the former
9.8 Minneapolis Teachers Retirement Fund Association through the
9.9 issuance of pension obligation bonds under this section.
9.10 Subd. 2. USE OF PROCEEDS. The proceeds of the bonds
9.11 issued, less costs, must be paid to the State Board of
9.12 Investment to be deposited as a payment toward the funding of
9.13 the unfunded actuarial accrued liability of the former
9.14 Minneapolis Teachers Retirement Fund Association owed by Special
9.15 School District No. 1, Minneapolis, and must be credited as an
9.16 asset of the Teachers Retirement Association.
9.17 Subd. 3. APPROPRIATIONS. Notwithstanding any law to the
9.18 contrary, special direct state aid, matching aid, and other
9.19 contributions levied for the Teachers Retirement Association
9.20 under section 354A.12, subdivisions 3a and 3b, and amortization
9.21 or supplementary amortization state aid reallocated to the
9.22 Teachers Retirement Association under section 423A.02 are
9.23 pledged and appropriated to the payment of the bonds and must be
9.24 transferred to Special School District No. 1, Minneapolis, and
9.25 additional employer contributions levied by Special School
9.26 District No. 1, Minneapolis, under section 354A.12, subdivision
9.27 3b, shall be retained by the district to the extent required to
9.28 pay debt service on the bonds for the succeeding 12‑month period
9.29 or a longer period established pursuant to the resolution of the
9.30 district authorizing the bonds.
9.31 Subd. 4. NO ELECTION. No election of the voters of the
9.32 district shall be required to issue bonds authorized by this
9.33 section.
9.34 Subd. 5. TERMS AND SALE OF BONDS. The bonds issued
9.35 pursuant to this section shall bear interest at the rate or
9.36 rates and mature on the date or dates not more than 30 years
10.1 from the date of issue as the district shall determine by
10.2 resolution. Interest may be at a fixed or variable rate. The
10.3 bonds may be sold and issued on terms and in a manner that
10.4 Special School District No. 1, Minneapolis, determines is in its
10.5 best interests and in the best interests of the state.
10.6 Subd. 6. THIS SECTION PREVAILS. Notwithstanding any
10.7 other law to the contrary, this section shall apply to the
10.8 issuance and sale of the bonds and to the purposes for which the
10.9 bonds may be issued.
10.10 Subd. 7. STATE PLEDGE AGAINST IMPAIRMENT OF
10.11 CONTRACTS. The state pledges and agrees with the holders of
10.12 bonds issued under this section that the state will not limit or
10.13 alter the rights vested in Special School District No. 1,
10.14 Minneapolis, to fulfill the terms of any agreements made with
10.15 the bondholders or in any way impair the rights and remedies of
10.16 the holders until the bonds, together with interest on them,
10.17 with interest on any unpaid installments of interest, and all
10.18 costs and expenses in connection with any action or proceeding
10.19 by or on behalf of the bondholders, are fully met and
10.20 discharged. The district may include this pledge and agreement
10.21 of the state in any agreement with the holders of bonds issued
10.22 under this section.
10.23 Subd. 8. NOT NET DEBT. Bonds ended under this section
10.24 not in default shall not be deemed net debt under any law
10.25 limiting indebtedness.
10.26 Subd. 9. AID REDUCTION FOR REPAYMENT. If the amount
10.27 transferred by Special School District No. 1, Minneapolis, to
10.28 the paying agent for the bonds is insufficient to pay required
10.29 debt service, the paying agent shall notify the commissioner of
10.30 finance. The commissioner shall reduce any and all unrestricted
10.31 state aids generally available to the school district by the
10.32 amount of the deficiency and pay the amounts to the paying agent
10.33 for the bonds for the payment of debt service. If the state
10.34 aids are reduced pursuant to this subdivision, the district may
10.35 levy a tax in the amount of the reduction in state aid.
10.36 Notwithstanding any other law to the contrary, no election of
11.1 the voters of the district is required for the levy and the levy
11.2 is not subject to other levy limitations.
11.3 Sec. 3. 128D.181 AID REDEDICATION.
11.4 Notwithstanding any law to the contrary and subject to
11.5 section 2, special direct state aid previously paid to the
11.6 Minneapolis Teachers Retirement Fund Association under section
11.7 354A.12, subdivision 3a, must be paid to the Teachers Retirement
11.8 Association.
11.9 Sec. 4. Minnesota Statutes 2004, section 354.05,
11.10 subdivision 2, is amended to read:
11.11 Subd. 2. TEACHER. (a) "Teacher" means:
11.12 (1) a person who renders service as a teacher, supervisor,
11.13 principal, superintendent, librarian, nurse, counselor, social
11.14 worker, therapist, or psychologist in a public school of the
11.15 state located outside of the corporate limits of a city of the
11.16 first class the city of Duluth or the city of St. Paul, or in
11.17 any charter school, irrespective of the location of the school,
11.18 or in any charitable, penal, or correctional institutions of a
11.19 governmental subdivision, or who is engaged in educational
11.20 administration in connection with the state public school
11.21 system, but excluding the University of Minnesota, whether the