1.1A bill for an act
1.2relating to retirement; authorizing the transfer of assets and members from the
1.3voluntary statewide volunteer firefighter retirement plan to a volunteer firefighter
1.4relief association;amending Minnesota Statutes 2016, sections 353G.01,
1.5subdivision 9, by adding a subdivision; 353G.03, subdivision 3; 353G.08,
1.6subdivision 3; 353G.11, subdivision 1; proposing coding for new law in Minnesota
1.7Statutes, chapter 353G.
1.8BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

1.9    Section 1. Minnesota Statutes 2016, section 353G.01, subdivision 9, is amended to read:
1.10    Subd. 9. Municipality. "Municipality" means a governmental entity specified in section
1.1169.011, subdivision 1 , paragraph (b), clauses (1), (2), and (5)., a city or township that has
1.12entered into a contract with an independent nonprofit firefighting corporation, or a city or
1.13township that has entered into a contract with a joint powers entity established under section
1.14471.59.

1.15    Sec. 2. Minnesota Statutes 2016, section 353G.01, is amended by adding a subdivision to
1.16read:
1.17    Subd. 9a. Relief association. "Relief association" means a volunteer firefighter relief
1.18association established under chapter 424A to which records, assets, and liabilities related
1.19to lump-sum or monthly benefits for active and former firefighters will be transferred from
1.20the retirement fund upon satisfaction of the requirements of section 353G.17.

1.21    Sec. 3. Minnesota Statutes 2016, section 353G.03, subdivision 3, is amended to read:
1.22    Subd. 3. Composition. (a) The advisory board consists of eight ten members.
2.1(b) The advisory board members are:
2.2(1) one representative of Minnesota townships, appointed by the Minnesota Association
2.3of Townships;
2.4(2) two representatives of Minnesota cities, appointed by the League of Minnesota Cities;
2.5(3) one representative of Minnesota fire chiefs, who is a fire chief, appointed by the
2.6Minnesota State Fire Chiefs Association;
2.7(4) two representatives of Minnesota volunteer firefighters, all who are active volunteer
2.8firefighters, one of whom is covered by the lump-sum retirement division and one of whom
2.9is covered by the monthly benefit retirement division, appointed by the Minnesota State
2.10Fire Chiefs Association;
2.11(5) one representative three representatives of Minnesota volunteer firefighters who is
2.12are covered by the lump-sum retirement division, appointed by the Minnesota State Fire
2.13Departments Association; and
2.14(6) one representative of the Office of the State Auditor, designated by the state auditor.

2.15    Sec. 4. Minnesota Statutes 2016, section 353G.08, subdivision 3, is amended to read:
2.16    Subd. 3. Authorized account disbursements. The assets of a lump-sum retirement
2.17account or of a monthly benefit retirement account of the retirement fund may only be
2.18disbursed for:
2.19(1) the administrative expenses of the retirement plan;
2.20(2) the investment expenses of the retirement fund;
2.21(3) the service pensions payable under section 353G.10, 353G.11, 353G.14, or 353G.15;
2.22(4) the survivor benefits payable under section 353G.12; and
2.23(5) the disability benefit coverage insurance premiums under section 353G.115; and
2.24(6) a transfer of assets under section 353G.17.

2.25    Sec. 5. Minnesota Statutes 2016, section 353G.11, subdivision 1, is amended to read:
2.26    Subdivision 1. Service pension levels; lump-sum retirement division. Except as
2.27provided in subdivision 1a, the lump-sum retirement division of the retirement plan provides
2.28the following levels of service pension amounts per full year of good time service credit to
2.29be selected at the election of coverage:
3.1(1) a minimum service pension level of $500 per year;
3.2(2) a maximum service pension level of $7,500 per year equal to the largest amount
3.3permitted under section 424A.02, subdivision 3, paragraph (d), as a maximum lump-sum
3.4service pension amount payable for each year of service; and
3.5(3) 69 service pension levels between the minimum level and the maximum level in
3.6$100 increments.

3.7    Sec. 6. [353G.17] TRANSFER AUTHORIZED.
3.8    Subdivision 1. Entity to initiate transfer. (a) An entity operating a fire department with
3.9firefighters who are covered by the retirement plan may initiate the transfer of records,
3.10assets, and liabilities related to the firefighters' lump-sum or monthly benefits under the
3.11retirement plan to a relief association that, at the time of the transfer, will be associated with
3.12the entity. The entity may be a municipality, an independent nonprofit firefighting
3.13corporation, or a joint powers entity.
3.14(b) A transfer is initiated by filing with the executive director the following:
3.15(1) a notice of intent to initiate a transfer;
3.16(2) a copy of the resolutions of the entity approving the transfer of records, assets, and
3.17liabilities from the retirement plan to a relief association; and
3.18(3) for each firefighter, the firefighter's name, address, telephone number, and e-mail
3.19address, if any.
3.20(c) The notice shall inform the executive director of the following:
3.21(1) the transfer effective date, which shall comply with paragraph (d);
3.22(2) the name of the relief association and the municipality, independent nonprofit
3.23firefighting corporation, or joint powers entity with which the relief association is associated;
3.24and
3.25(3) a summary of the type and level of pension or retirement benefits, including any
3.26ancillary benefits, provided by the relief association or, in the case of a new relief association,
3.27to be provided, and related terms and conditions.
3.28(d) A transfer takes effect on the next January 1 that is at least 120 days after the filing
3.29of the notice, but not later than one year after the filing of the notice.
4.1    Subd. 2. Approval by the relief association. (a) Before a transfer of records, assets,
4.2and liabilities from the retirement plan to a relief association may occur, the board of trustees
4.3of the relief association shall adopt resolutions as follows:
4.4(1) approving and accepting the transfer of records, assets, and liabilities from the
4.5retirement plan; and
4.6(2) amending the bylaws of the relief association as necessary to add the firefighters
4.7whose benefits are being transferred from the retirement plan and to provide that each benefit
4.8being transferred retains vesting, distribution, and other rights to which the firefighter, for
4.9whom the benefit is being transferred, is entitled under the terms of the retirement plan to
4.10the date of the transfer.
4.11The board of trustees shall file a copy of the resolutions with the executive director.
4.12(b) The board of trustees of the relief association shall file with the state auditor the
4.13following:
4.14(1) a copy of the resolutions required under paragraph (a);
4.15(2) a copy of the bylaws of the relief association and any bylaw amendments;
4.16(3) a copy of the relief association's investment policy;
4.17(4) a statement that a board of trustees has been duly elected and each trustee's name,
4.18address, telephone number, and e-mail address, if any;
4.19(5) a copy of the most recent annual financial, investment, and plan administration report
4.20filed under section 69.051, unless the due date for the first such report has not yet occurred;
4.21and
4.22(6) a copy of the documentation indicating that a special fund has been established with
4.23a financial institution to receive a transfer of assets from the retirement plan.
4.24(c) Upon receipt of the information and documents required under paragraph (b), the
4.25state auditor shall issue to the relief association and the executive director written
4.26confirmation of receipt of all required information and documents.
4.27    Subd. 3. Approval by the firefighters. (a) A transfer under subdivision 1 shall not occur
4.28unless the active firefighters whose benefits are to be transferred from the retirement plan
4.29to a relief association approve the transfer by a vote of the firefighters conducted by the
4.30executive director.
5.1(b) The approval of the firefighters shall be determined by a vote of all active firefighters
5.2whose benefits are to be transferred. An affirmative vote of a majority of the firefighters
5.3voting shall constitute approval.
5.4(c) The executive director shall provide a voting ballot and the following to each active
5.5firefighter:
5.6(1) a summary of the benefits currently provided to the firefighters under the retirement
5.7plan;
5.8(2) a copy of the resolutions of the municipality approving the transfer;
5.9(3) a copy of the resolutions of the board of trustees approving the transfer;
5.10(4) a copy of the notice of intent to transfer required under subdivision 1;
5.11(5) a copy of the state auditor's confirmation required under subdivision 2, paragraph
5.12(c); and
5.13(6) the instructions and time frame for voting. Firefighters shall be given no less than
5.1430 days in which to vote.
5.15(d) The vote of any firefighter, including whether or not the firefighter voted, shall not
5.16be disclosed to any officer or member of the staff of the municipality or to any officer,
5.17trustee, or member of the staff of the relief association.
5.18(e) The executive director shall tally the votes and report the results to the relief
5.19association and the municipality.
5.20    Subd. 4. Transfer process. (a) Upon completion of the actions required under
5.21subdivisions 1 to 3, the retirement plan shall transfer to the relief association as of the
5.22effective date identified in the notice under subdivision 1, the records, assets, and liabilities
5.23related to the former and current firefighters with benefits under the retirement plan, along
5.24with any assets in excess of liabilities credited to the lump-sum account or the monthly
5.25benefit retirement account attributable to the firefighters and the municipality.
5.26(b) The executive director:
5.27(1) shall transfer the assets in cash;
5.28(2) shall transfer any accounts receivable associated with the lump-sum account or
5.29monthly benefit retirement account;
5.30(3) shall settle any accounts payable from the account before the transfer; and
6.1(4) may deduct from the assets to be transferred reasonable costs incurred by the
6.2retirement plan to conduct the voting process and complete the transfer.
6.3    Subd. 5. Relief association obligations and rights upon transfer from the retirement
6.4plan. (a) Upon transfer of the assets of the lump-sum account or monthly benefit retirement
6.5account, the pension liabilities attributable to the benefits for the former and current
6.6firefighters shall become the obligation of the special fund of the relief association.
6.7(b) Upon the transfer of the assets of the lump-sum account or monthly benefit retirement
6.8account, the board of trustees of the relief association has legal title to and management
6.9responsibility for the transferred assets as trustees for persons having a beneficial interest
6.10in those assets arising out of the benefit coverage provided by the account.
6.11(c) The relief association is the successor in interest with respect to all claims against
6.12the retirement plan relating to the transferred lump-sum account or monthly benefit retirement
6.13account, except for claims alleging any act or acts by the retirement plan or its fiduciaries
6.14that were not done in good faith or that constituted a breach of fiduciary responsibility under
6.15chapter 356A.
6.16(d) The value of each volunteer firefighter's benefit in the retirement plan on the day
6.17before the asset transfer shall be no less than the value of the volunteer firefighter's benefit
6.18on the day after the asset transfer. The relief association shall give credit, with respect to
6.19each firefighter whose benefit is being transferred, for all past service, including service
6.20credit with the retirement plan and with any predecessor relief association, to the extent
6.21credit is given for such service in the records of the retirement plan for that firefighter.
6.22(e) Upon completion of the transfer of records, assets, and liabilities, the executive
6.23director shall provide written notice to the state auditor, the commissioner of revenue, and
6.24the secretary of state that the transfer is complete.
6.25    Subd. 6. Failure to obtain approval, certification, or verification. If the municipality,
6.26board of trustees, or firefighters fail to approve the transfer under subdivision 1, 2, or 3 or
6.27the requirements of subdivision 2, paragraph (b), are not met, the transfer of records, assets,
6.28and liabilities from the retirement plan to the relief association shall not occur.

6.29    Sec. 7. EFFECTIVE DATE.
6.30Sections 1 to 6 are effective the day following final enactment.