LCPR03-252

A bill for an act

relating to retirement; Public Employees Retirement

Association; creating a post‑sentencing officers and

emergency dispatchers retirement plan; amending

Minnesota Statutes 2002, sections 3.85, subdivisions

11 and 12; 352.01, subdivision 2b; 353.01, subdivision

2b; 355.01, subdivisions 2e, 2f, 3j, 3k, 3l; 355.02,

subdivision 3; 356.20, subdivision 2; 356.215,

subdivisions 8 and 11; 356.30, subdivision 3; 356.302,

subdivision 7; 356.303, subdivision 4; 356.315, by

adding a subdivision; 356.465, subdivision 3; and

356.555, subdivision 4; and proposing coding for new

law as Minnesota Statutes, chapter 353G.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

ARTICLE 1

POST‑SENTENCING OFFICERS AND EMERGENCY

DISPATCHERS RETIREMENT PLAN CREATION

Section 1. 353G.01 POST‑SENTENCING OFFICERS AND

EMERGENCY DISPATCHERS RETIREMENT PLAN; DEFINITIONS.

Subdivision 1. IN GENERAL. For purposes of this chapter,

unless the language or the context clearly indicates that a

different meaning is intended, each of the following terms has

the meaning ascribed.

Subd. 2. ACCUMULATED CONTRIBUTIONS. "Accumulated

contributions" means the total of member contributions made by

salary deductions or by assessments or payments made in lieu of

salary deductions, if authorized, which are credited by the

retirement plan and entered into the member's individual record.

Subd. 3. ACTUARIAL EQUIVALENT. "Actuarial equivalent"

means the condition of one annuity or benefit having an equal

actuarial present value as another annuity or benefit,

determined as of a given date with each actuarial present value

based on the appropriate mortality table adopted by the board of

trustees based on the experience of that retirement fund

association as recommended by the actuary retained by the

legislative commission on pensions and retirement and using the

applicable preretirement or post‑retirement interest rate

assumption specified in section 356.215, subdivision 8.

Subd. 4. ALLOWABLE SERVICE. "Allowable service" means

any service rendered by a post‑sentencing officer or an

emergency dispatcher during a period in which the officer or

dispatcher receives salary from a public employer from which

member contribution salary deductions are made to and credited

by the post‑sentencing officers and emergency dispatchers

retirement plan.

Subd. 5. ANNUITY. "Annuity" means the payments made by

the post‑sentencing officers and emergency dispatchers

retirement plan in the form of a retirement annuity or an

optional annuity.

Subd. 6. APPROVED ACTUARY. "Approved actuary" means (1)

any actuary who is either a fellow of the society of actuaries

or who has at least 15 years of service to major public employee

retirement funds; or (2) any firm which retains such an actuary

on its staff.

Subd. 7. AVERAGE SALARY. "Average salary" means the

average of the highest five successive years of salary which the

post‑sentencing officer or emergency dispatcher has made

contributions to the retirement fund by payroll deduction. If

the officer or dispatcher has less than five years of allowable

service, the term means the average of salary for the entire

period of allowable service.

Subd. 8. BENEFIT. "Benefit" means the allowance paid or

payable by the post‑sentencing officers and emergency

dispatchers retirement plan to a surviving spouse, designated

beneficiary, surviving child or estate or in periodic payments

to a member or former member of the retirement plan who is

permanently and totally disabled.

Subd. 9. BOARD. "Board" means the board of trustees of

the Public Employees Retirement Association.

Subd. 10. DEPENDENT CHILD. "Dependent child" means any

biological or adopted child of a deceased post‑sentencing

officer or emergency dispatcher who has not reached the age of

20 and is dependent on the officer or dispatcher for more than

one‑half of the child's support at the time of the death of the

officer or dispatcher. It also means a child of the officer or

dispatcher conceived during the lifetime of the officer or

dispatcher and born after the death of the officer or the

dispatcher.

Subd. 11. DESIGNATED BENEFICIARY. "Designated

beneficiary" means the person who is designated by an active or

retired post‑sentencing officer or emergency dispatcher to

receive the benefits to which a beneficiary is entitled to

receive under this chapter. A beneficiary designation is valid

only if it is made on the applicable form prescribed by the

director, is properly completed and signed, and is received by

the Public Employees Retirement Association or is postmarked on

or before the date of the death of the officer or dispatcher.

If no beneficiary is designated or if the designated beneficiary

predeceases the officer or dispatcher, the term means the estate

of the deceased officer or dispatcher.

Subd. 12. DIRECTOR OR EXECUTIVE DIRECTOR. "Director" or

"executive director" means the executive director of the Public

Employees Retirement Association.

Subd. 13. DISABILITY. "Disability" or "total and

permanent disability" means the inability of a post‑sentencing

officer or emergency dispatcher to engage in any substantial

gainful employment activity by reason of a medically

determinable physical or mental impairment which is reasonably

expected to be of a long‑continued and indefinite duration,

which in no event may be less than one year.

Subd. 14. DISPATCHER. "Dispatcher" means an emergency

dispatcher.

Subd. 15. EMERGENCY DISPATCHER. "Emergency dispatcher"

means a governmental employee who is employed at a primary

public safety answering point, whose primary employment

responsibility is receiving emergency "911" telephone

communications from the public which requires the subsequent

contact with and the response by police, fire, or medical

resources, and who is certified by the governmental employer as

regularly and consistently spending at least a majority of the

person's employment time in those duties.

Subd. 16. MEMBER. "Member" means a post‑sentencing

officer or an emergency dispatcher who makes regular member

contributions to the retirement plan in that capacity.

Subd. 17. NORMAL RETIREMENT AGE. "Normal retirement age"

means age 55.

Subd. 18. NORMAL RETIREMENT ANNUITY. "Normal retirement

annuity" means a retirement annuity computed under section 7,

subdivision 2, that is paid or is payable to a member upon

meeting the age and service requirements specified in section 7,

subdivision 1.

Subd. 19. OFFICER. "Officer" means a post‑sentencing

officer.

Subd. 20. OPTIONAL ANNUITY FORM. "Optional annuity form"

means an alternate means for the receipt of an annuity

established by the board under section 7, subdivision 5.

Subd. 21. POST‑SENTENCING OFFICER. "Post‑sentencing

officer" means a governmental employee who is responsible for

the control, supervision, and care of convicted offenders on

probation in lieu of imprisonment or of offenders conditionally

released on parole after imprisonment and who is certified by

the governmental employer as regularly and consistently spending

at least a majority of the person's employment time in the

direct control, supervision, and care of convicted offenders who

represent a risk of violence or physical harm to the employee.

Subd. 22. PRIMARY PUBLIC SAFETY ANSWERING

POINT. "Primary public safety answering point" is a

communications facility that is operated by a governmental

entity and that is operated on a 24‑hour basis to be the initial

emergency "911" telephone communications from persons in a 911

service area and that is authorized, as appropriate, to directly

dispatch public safety services or to extend, transfer, or relay

the communications to the appropriate public safety agency.

Subd. 23. REDUCED RETIREMENT ANNUITY. "Reduced

retirement annuity" means an annuity paid between age 50 and age

55 under section 7, subdivision 3.

Subd. 24. RETIREMENT. "Retirement" means the time after

the date of the cessation of active service by a post‑sentencing

officer or emergency dispatcher who is thereafter entitled to an

accrued retirement annuity which is payable under an application

filed by the former officer or dispatcher. The provisions of

law in effect on the date that the officer or dispatcher ceases

rendering active service in that capacity thereafter determines

the rights of the person with respect to the plan.

Subd. 25. RETIREMENT ANNUITY. "Retirement annuity" means

an annuity computed under section 7 and paid by the director to

the retired post‑sentencing officer or emergency dispatcher or

to the specified remainder recipient under an optional annuity

form.

Subd. 26. SALARY OR COVERED SALARY. (a) "Salary" or

"covered salary" means:

(1) the wages paid to a post‑sentencing officer or an

emergency dispatcher before deductions for deferred

compensation, supplemental retirement plans, or other voluntary

salary reductions; or

(2) other periodic compensation, paid to an officer or

dispatcher before deductions for deferred compensation,

supplemental retirement plans, or other voluntary salary

reductions; and

(3) during a period of receipt of worker's compensation

while on a leave of absence, the differential between the salary

that the officer or dispatcher would normally receive during the

leave and the salary received, if any, on which the officer or

dispatcher makes a member contribution equivalent amount.

(b) "Salary" or "covered salary" does not mean:

(1) lump sum sick leave payments;

(2) severance payments;

(3) lump sum annual leave payments;

(4) overtime payments made at the time of separation from

state service;

(5) payments in lieu of employer‑paid group insurance

coverage, including the difference between single rates and

family rates for an officer or dispatcher with single coverage;

(6) employer contributions to a deferred compensation or

tax‑sheltered annuity program; and

(7) amounts contributed under a benevolent vacation or sick

leave donation program.

Subd. 27. SPOUSE. "Spouse" means the person who was

legally married to the post‑sentencing officer or the emergency

dispatcher immediately prior to the death of the officer or

dispatcher.

Sec. 2. 353G.02 RETIREMENT PLAN AND FUND.

Subdivision 1. ESTABLISHMENT. The post‑sentencing

officers and emergency dispatchers retirement plan is

established.

Subd. 2. FUND. (a) A post‑sentencing officers and

emergency dispatchers retirement fund is established within the

state treasury.

(b) Member contributions under section 5, subdivision 1,

employer contributions under section 5, subdivision 2, and

revenue derived from the investment of fund assets must be

deposited in the post‑sentencing officers and emergency

dispatchers retirement fund.

dispatchers retirement fund are refunds of member contributions

under section 5, retirement annuities under section 7,

disability benefits under section 9, survivorship benefits under

section 10, and necessary and reasonable expenses of

administering the plan and fund.

Subd. 3. AUDIT. The legislative auditor shall audit the

plan and fund.

Sec. 3. 353G.03 ADMINISTRATION.

The post‑sentencing officers and emergency dispatchers

retirement plan and fund must be administered by the board of

trustees and the executive director of the Public Employees

Retirement Association. Fiduciary activities regarding the plan

and the fund must be undertaken in a manner consistent with

chapter 356A.

Sec. 4. 353G.04 INVESTMENTS; PARTICIPATION IN THE POST

RETIREMENT INVESTMENT FUND.

Subdivision 1. INVESTMENTS. The State Board of

Investment shall invest and reinvest the post‑sentencing

officers and emergency dispatchers retirement fund under

chapters 11A and 356A.

Subd. 2. TREASURER. The commissioner of finance is the

ex officio treasurer of the post‑sentencing officers and

emergency dispatchers retirement fund. The treasurer shall

provide the executive director of the Public Employees

Retirement Association with a detailed statement of revenues and

disbursements.

Subd. 3. POST RETIREMENT INVESTMENT FUND. (a) The

post‑sentencing officers and emergency dispatchers retirement

plan must participate in the Minnesota post retirement

investment fund. Assets representing the retirement annuities

payable by the plan must be deposited in the investment fund and

necessary amounts must be withdrawn to pay annuity amounts due

and payable. The amounts necessary are annually appropriated

for this purpose.

(b) For former plan members beginning the receipt of

annuities, the required reserves must be determined in

accordance with the appropriate mortality table based on the

experience of the plan as recommended by the actuary retained by

the legislative commission on pensions and retirement and

approved by the commission under section 356.215 and using the

applicable post‑retirement interest rate assumption specified in

section 356.215, subdivision 8. Assets representing the

required reserves for those annuities must be transferred to the

Minnesota post retirement investment fund as of the last

business day of the month in which the retirement annuity begins

as specified in section 11A.18.

Sec. 5. 353G.05 CONTRIBUTION RATES.

Subdivision 1. MEMBER CONTRIBUTION; SALARY

DEDUCTION. (a) A member of the post‑sentencing officers and

emergency dispatchers retirement plan shall pay an amount equal

to ... percent of the salary of the member, which constitutes

the member contribution to the fund.

(b) Member contribution amounts must be deducted from the

salary payable to the member each pay period by the department

head. The employing agency shall have the deduction paid to the

fund treasurer for deposit into the post‑sentencing officers and

emergency dispatchers retirement fund and shall make a detailed

report of deductions made each pay period to the executive

director of the Public Employees Retirement Association.

Subd. 2. EMPLOYER CONTRIBUTION. The employer of a member

of the post‑sentencing officers and emergency dispatchers

retirement plan shall pay an amount equal to ... percent of the

salary of the member, which constitutes the employer

contribution to the fund.

Subd. 3. OMITTED DEDUCTIONS. (a) If the employer fails

to take deductions which are past due for a period of less than

61 days, those deductions must be taken from a later member

salary payment.

(b) If the employer fails to take deductions which are past

due for a period longer than 60 days or if the plan member is no

longer employed in covered employment, the employer must pay the

amount of the omitted deduction, the amount of any unpaid

employer contribution, plus an amount equal to 8.5 percent of

the total amount due if the failure to make a payment is of less

than one year in duration and plus annual compound interest at

the rate of 8.5 percent per annum if the failure to make a

payment is a period of 12 months or greater.

Sec. 6. 353G.06 PLAN MEMBERSHIP; SOCIAL SECURITY

COVERAGE.

(a) Except as provided in paragraph (b), a post‑sentencing

officer or an emergency dispatcher, by accepting employment in

that capacity or by continuing employment in that capacity,

accepts coverage by the post‑sentencing officers and emergency

dispatchers retirement plan in lieu of any other Minnesota

public pension plan coverage.

(b) A person who was employed in a post‑sentencing officer

position or in an emergency dispatcher position on July 1, 2005,

and who is at least 45 years of age on that date, may make a

one‑time election to retain the person's existing retirement

coverage and to decline a transfer to coverage by the

post‑sentencing officers and emergency dispatchers retirement

plan. The election must be made in writing on a form prescribed

by the executive director and is irrevocable.

dispatchers retirement plan must be covered by the federal old

age, survivors, disability and health insurance program under

chapter 355 by virtue of employment covered by the plan.

Sec. 7. 353G.07 RETIREMENT ANNUITY.

Subdivision 1. ELIGIBILITY. (a) After terminating

employment, a former post‑sentencing officer or a former

emergency dispatcher who has attained the age of 55 years and

who has credit for three years of allowable service under

section 1, subdivision 4, is entitled, upon application, to a

normal retirement annuity.

(b) In lieu of a normal retirement annuity, a retiring

former post‑sentencing officer or emergency dispatcher may elect

to receive an optional annuity form under subdivision 5.

Subd. 2. ANNUITY AMOUNT. The retirement annuity amount

is the average salary under section 1, subdivision 4, of the

retiring post‑sentencing officer or the retiring emergency

dispatcher multiplied by the percentage amount specified in

section 356.315, subdivision 5b, for each year of allowable

service of the person and the appropriate fractional amount for

the number of months of allowable service less than a full year.

Subd. 3. EARLY RETIREMENT. A former post‑sentencing

officer or a former emergency dispatcher who has attained the

age of at least 50 years and has credit for not less than three

years of allowable service credit under section 1, subdivision

4, is entitled, upon application, to a reduced retirement

annuity. The reduced retirement annuity is an amount equal to

the annuity calculated under subdivision 2 reduced so that the

subsequent reduced annuity is the actuarial equivalent at that

age of the annuity that would be payable if the person deferred

receipt of the annuity from the day that the annuity begins to

accrue until age 55.

Subd. 4. ACCRUAL AND DURATION. The retirement annuity

under this section accrues on the first day of the first

calendar month after the date on which the former

post‑sentencing officer or the former emergency dispatcher

terminates covered service. The annuity must be paid in equal

monthly installments each year and does not accrue beyond the

end of the month in which entitlement to the annuity ends or is

terminated. If the annuitant dies prior to negotiating the

check for the month in which the annuitant's death occurs,

payment must be made to the person's surviving spouse, or if

none, to the designated beneficiary of the person, or if none,

to the estate of the person. The retirement annuity is payable

for the life of the recipient or in accord with the terms of any

optional annuity form that was selected by the retiring plan

member.

Subd. 5. OPTIONAL ANNUITY FORMS. (a) The board of

trustees shall establish optional annuity forms, including a

joint and survivor annuity. Except as provided in paragraph

(b), the optional annuity forms must be the actuarial equivalent

to the normal retirement annuity, the early reduced retirement

annuity, or the disability benefit, whichever applies. In

establishing the optional annuity forms, the board shall obtain

the written recommendation of the consulting actuary retained by

the legislative commission on pensions and retirement and must

retain those recommendations as part of the permanent records of

the board. A retiring plan member may select an optional

annuity form in lieu of any other available annuity or benefit

form.

(b) If a retiring plan member or a disabilitant selects a

joint and survivor optional annuity form under paragraph (a),

the retiring plan member or disabilitant must receive a normal

single life annuity if the designated optional annuity

beneficiary dies before the primary annuity receipt. No

reduction under this option may be made in the person's annuity

to provide for the restoration of the normal single life annuity

in the event of the death of the designated optional annuity

beneficiary.

Sec. 8. 353G.08 AUGMENTATION OF CERTAIN ANNUITIES.

(a) Unless a combined service annuity under section 356.30

has been elected, a person who becomes a member of this plan

after having been a member of the general employees retirement

plan of the Public Employees Retirement Association, of the

public employees police and fire retirement plan, of the local

government correctional service retirement plan of the public

employee retirement association, of the general state employees

retirement plan of the Minnesota State Retirement System, or of

the correctional state employees retirement plan of the

Minnesota State Retirement System is covered under section

352.72, subdivision 2, or 353.71, subdivision 2, whichever

applies, with respect to that prior service.

(b) A person who becomes a member of one of the retirement

plans cited in paragraph (a) after having been a member of this

plan is also covered under section 352.72, subdivision 2, or

353.71, subdivision 2, whichever applies, with respect to that

prior service, unless the annuity is calculated under section

356.30.

Sec. 9. 353G.09 DISABILITY BENEFITS.

Subdivision 1. AGE AND SERVICE REQUIREMENTS. A

post‑sentencing officer or an emergency dispatcher who is

covered by the plan, who is less than normal retirement age, and

who becomes totally and permanently disabled after rendering

three or more years of allowable service is entitled to a

disability benefit in an amount provided in subdivision 3. If

the disabled officer or dispatcher's allowable service has

terminated at any time, the officer or dispatcher must have

rendered at least two years of allowable service after last

becoming an officer or dispatcher covered by the plan. Refunds

may be repaid under section 11 before the effective accrual date

of the disability benefit under subdivision 2.

Subd. 2. APPLICATION; ACCRUAL OF BENEFITS. A

post‑sentencing officer or an emergency dispatcher making claim

for a total and permanent disability benefit, or someone acting

on behalf of the officer or dispatcher upon proof of authority

satisfactory to the executive director of the Public Employees

Retirement Association, shall file a written application for

benefits in the office of the Public Employees Retirement

Association. The application must be in a form and manner

prescribed by the executive director of the Public Employees

Retirement Association. The benefit begins to accrue on the day

following the start of disability or on the day following the

last day paid, whichever is later, but not earlier than 180 days

before the date the application is filed with the director.

Subd. 3. COMPUTATION OF BENEFITS. The total and

permanent disability benefit must be computed in the manner

provided in section 6. The disability benefit is an amount

equal to the normal annuity without reduction for each month the

post‑sentencing officer or emergency dispatcher is under the

normal retirement age at the time of becoming disabled. A

disabled officer or dispatcher may choose to receive the normal

disability benefit or an optional annuity as provided in section

7, subdivision 5. This choice must be made before the start of

payment of the disability benefit and is effective the date on

which the disability begins to accrue as provided in subdivision

Subd. 4. MEDICAL OR PSYCHOLOGICAL EXAMINATIONS;

AUTHORIZATION FOR PAYMENT OF BENEFIT. (a) An applicant shall

provide medical or psychological evidence to support an

application for total and permanent disability. The executive

director of the Public Employees Retirement Association shall

have the post‑sentencing officer or emergency dispatcher

examined by at least one additional licensed chiropractor,

physician, or psychologist designated by the medical adviser.

The examining chiropractors, physicians, or psychologists shall

make written reports to the director concerning the officer or

dispatcher's disability, including medical opinions as to

whether the officer or dispatcher is permanently and totally

disabled within the meaning of section 1, subdivision 13.

(b) The director shall also obtain written certification

from the employer stating whether the employment has ceased or

whether the officer or dispatcher is on a sick leave of absence

because of a disability that will prevent further service to the

employer and as a consequence the officer or dispatcher is not

entitled to compensation from the employer.

physicians, psychologists, and chiropractors and any other

evidence supplied by the officer or dispatcher or other

interested parties. If the medical adviser finds the officer or