1.2relating to retirement; providing financial solvency measures for Minnesota
1.3statewide and major local public employee retirement plans; increasing contribution
1.4rates; reducing certain postretirement adjustment increase rates; modifying
1.5investment return assumptions; extending amortization target dates; reducing
1.6deferred annuities augmentation; requiring a study on postretirement adjustments;
1.7amending Minnesota Statutes 2016, sections 3A.02, subdivision 4; 3A.03,
1.8subdivision 2; 352.01, subdivision 13a; 352.017, subdivision 2; 352.04, subdivisions
1.92, 3, 8, 9; 352.116, subdivision 1a; 352.22, subdivisions 2, 3, by adding
1.10subdivisions; 352.23; 352.27; 352.92, subdivisions 1, 2, by adding a subdivision;
1.11352.955, subdivision 3; 352B.013, subdivision 2; 352B.02, subdivisions 1a, 1c;
1.12352B.08, by adding a subdivision; 352B.085; 352B.086; 352B.11, subdivision 4;
1.13352D.04, subdivision 2; 352D.05, subdivision 4; 352D.085, subdivision 1; 352D.11,
1.14subdivision 2; 352D.12; 353.01, subdivision 16; 353.0161, subdivision 2; 353.0162;
1.15353.27, subdivisions 3c, 7a, 12, 12a, 12b; 353.28, subdivision 5; 353.30, subdivision
1.165; 353.34, subdivisions 2, 3; 353.35, subdivision 1; 353.65, subdivisions 2, 3, by
1.17adding a subdivision; 354.42, subdivisions 2, 3; 354.436, subdivision 3; 354.44,
1.18subdivision 6; 354.49, subdivision 2; 354.50, subdivision 2; 354.51, subdivision
1.195; 354.52, subdivision 4; 354.53, subdivision 5; 354.55, subdivision 11; 354A.011,
1.20subdivision 3a; 354A.093, subdivision 6; 354A.096; 354A.12, subdivisions 1, 1a,
1.212a, 3a, 7; 354A.29, subdivision 7; 354A.31, subdivision 7; 354A.34; 354A.37,
1.22subdivisions 2, 3; 354A.38, subdivision 3; 356.195, subdivision 2; 356.215,
1.23subdivisions 8, 9, 11; 356.30, subdivision 1; 356.415, subdivisions 1, 1a, 1b, 1c,
1.241d, 1e, 1f, by adding a subdivision; 356.44; 356.50, subdivision 2; 356.551,
1.25subdivision 2; 490.121, subdivisions 4, 25, 26; 490.1211; 490.124, subdivision
1.2612; proposing coding for new law in Minnesota Statutes, chapter 356; repealing
1.27Minnesota Statutes 2016, sections 3A.12; 352.045; 352.72; 352B.30; 353.27,
1.28subdivision 3b; 353.71; 354.42, subdivisions 4a, 4b, 4c, 4d; 354.60; 354A.29,
1.29subdivisions 8, 9; 354A.39.
1.30BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:


1.33    Section 1. Minnesota Statutes 2016, section 3A.02, subdivision 4, is amended to read:
2.1    Subd. 4. Deferred annuities augmentation. (a) The deferred retirement allowance of
2.2any former legislator must be computed as provided in subdivision 1 on the basis of allowable
2.3service and augmented as provided herein.(b) The required reserves applicable to the deferred
2.4retirement allowance, determined as of the date the benefit begins to accrue using an
2.5appropriate mortality table and an interest assumption of six percent, must be augmented
2.6by interest compounded annually from the first of the month following the termination of
2.7active service, or July 1, 1973, whichever is later, to the first day of the month in which the
2.8allowance begins to accrue effective date of retirement, at the following annually
2.9compounded rate or rates:
2.10(1) five percent until January 1, 1981;
2.11(2) three percent from January 1, 1981, or from the first day of the month following the
2.12termination of active service, whichever is later, until January 1 of the year in which the
2.13former legislator attains age 55 or until January 1, 2012, whichever is earlier;
2.14(3) five percent from the period end date under clause (2) until the effective date of
2.15retirement or until January 1, 2012, whichever is earlier; and
2.16(4) two percent after December 31, 2011. from January 1, 2012, until December 31,
2.172017; and
2.18(5) after December 31, 2017, the deferred annuity must not be augmented.
2.19EFFECTIVE DATE.This section is effective July 1, 2017.

2.20    Sec. 2. Minnesota Statutes 2016, section 352.116, subdivision 1a, is amended to read:
2.21    Subd. 1a. Actuarial reduction for early retirement. This subdivision applies to a
2.22person who has become at least 55 years old and first became a covered employee after
2.23June 30, 1989, and to any other covered employee who has become at least 55 years old
2.24and whose annuity is higher when calculated under section 352.115, subdivision 3, paragraph
2.25(b), in conjunction with this subdivision than when calculated under section 352.115,
2.26subdivision 3 , paragraph (a), in conjunction with subdivision 1. A covered employee who
2.27retires before the normal retirement age shall be paid the normal retirement annuity provided
2.28in section 352.115, subdivisions 2 and 3, paragraph (b), reduced so that as described in
2.29clause (1) or (2), as applicable.
2.30(1) For covered employees who retire on or after July 1, 2018, the reduced annuity is
2.31the actuarial equivalent of the annuity that would be payable to the employee if the employee
2.32deferred receipt of the annuity until normal retirement age and the annuity amount were
2.33augmented at an the applicable annual rate of three percent, compounded annually, from
3.1the day the annuity begins to accrue until the normal retirement age. The applicable annual
3.2rate is the rate in effect on the employee's effective date of retirement and shall be considered
3.3as fixed for the employee for the period until the employee reaches normal retirement age.
3.4The applicable annual rates are the following:
3.5(i) until June 30, 2018, three percent if the employee became an employee before July
3.61, 2006, and 2.5 percent if the employee became an employee after June 30, 2006;
3.7(ii) a rate that changes each month, beginning July 1, 2018, through June 30, 2023, which
3.8is determined by reducing the rate in item (i) to zero in equal monthly increments over the
3.9five-year period; and
3.10(iii) after June 30, 2023, zero percent.
3.11After June 30, 2023, actuarial equivalent, for the purpose of determining the reduced
3.12annuity commencing before normal retirement age under this clause, shall not take into
3.13account any augmentation.
3.14(2) For covered employees who retire before July 1, 2018, the reduced annuity is the
3.15actuarial equivalent of the annuity that would be payable to the employee if the employee
3.16deferred receipt of the annuity until normal retirement age and the annuity amount were
3.17augmented at an annual rate of three percent, compounded annually, from the day the annuity
3.18begins to accrue until normal retirement age if the employee became an employee before
3.19July 1, 2006, and at an annual rate of 2.5 percent, compounded annually, from the day the
3.20annuity begins to accrue until the normal retirement age if the employee initially becomes
3.21became an employee after June 30, 2006.
3.22EFFECTIVE DATE.This section is effective July 1, 2017.

3.23    Sec. 3. Minnesota Statutes 2016, section 352.22, subdivision 2, is amended to read:
3.24    Subd. 2. Amount of refund. Except as provided in subdivision 3, the refund payable
3.25to a person who ceased to be a state employee by reason of a termination of state service is
3.26an amount equal to employee accumulated contributions plus interest until the date on which
3.27the refund is paid, at the rate of following rates for the applicable period:
3.28(a) six percent per year compounded daily from the date that the contribution was made
3.29until June 30, 2011, or until the date on which the refund is paid, whichever is earlier, and
3.30at the rate of;
4.1(b) four percent per year compounded daily from the date that the contribution was made
4.2or from July 1, 2011, whichever is later, until the date on which the refund is paid. until
4.3June 30, 2017; and
4.4(c) three percent per year compounded daily from the date that the contribution was
4.5made or July 1, 2017, whichever is later.
4.6Included with the refund is any interest paid as part of repayment of a past refund, plus
4.7interest thereon from the date of repayment.

4.8    Sec. 4. Minnesota Statutes 2016, section 352.22, is amended by adding a subdivision to
4.9read:
4.10    Subd. 2b. Refund repayment. Any person who has received a refund from the state
4.11employees retirement plan, and who is a member of any of the retirement plans specified
4.12in section 356.311, paragraph (b), may repay the refund with interest to the state employees
4.13retirement plan. If a refund is repaid to the plan and more than one refund has been received
4.14from the plan, all refunds must be repaid. Repayment must be made as provided in section
4.15352.23, and under terms and conditions consistent with that section as agreed upon with
4.16the director.
4.17EFFECTIVE DATE.This section is effective July 1, 2017.

4.18    Sec. 5. Minnesota Statutes 2016, section 352.22, subdivision 3, is amended to read:
4.19    Subd. 3. Deferred annuity. (a) An employee who has at least three years of allowable
4.20service if employed before July 1, 2010, or who has at least five years of allowable service
4.21if employed after June 30, 2010, when termination occurs may elect to leave the accumulated
4.22contributions in the fund and thereby be entitled to a deferred retirement annuity. The annuity
4.23must be computed under the law in effect when state service terminated, on the basis of the
4.24allowable service credited to the person before the termination of service.
4.25(b) An employee on layoff or on leave of absence without pay, except a leave of absence
4.26for health reasons, and who does not return to state service must have an annuity, deferred
4.27annuity, or other benefit to which the employee may become entitled computed under the
4.28law in effect on the employee's last working day.
4.29(c) No application for a deferred annuity may be made more than 60 days before the
4.30time the former employee reaches the required age for entitlement to the payment of the
4.31annuity. The deferred annuity begins to accrue no earlier than 60 days before the date the
4.32application is filed in the office of the system, but not (1) before the date on which the
5.1employee reaches the required age for entitlement to the annuity nor (2) before the day
5.2following the termination of state service in a position which is not covered by the retirement
5.3system.
5.4(d) Application for the accumulated contributions left on deposit with the fund may be
5.5made at any time following the date of the termination of service.
5.6(e) Deferred annuities must be augmented as provided in section 352.72, subdivision 2
5.7subdivision 3a.
5.8EFFECTIVE DATE.This section is effective July 1, 2017.

5.9    Sec. 6. Minnesota Statutes 2016, section 352.22, is amended by adding a subdivision to
5.10read:
5.11    Subd. 3a. Computation of deferred annuity. (a) The deferred annuity, if any, accruing
5.12under subdivision 3, on the basis of allowable service before termination of state service
5.13and augmented by interest compounded annually from the first day of the month following
5.14the month in which the employee ceased to be a state employee, or July 1, 1971, whichever
5.15is later, to the effective date of retirement.
5.16(b) For a person who became a state employee before July 1, 2006, the annuity must be
5.17augmented at the following rate or rates:
5.18(1) five percent until January 1, 1981;
5.19(2) three percent thereafter until January 1 of the year following the year in which the
5.20former employee attains age 55 or until January 1, 2012, whichever is earlier;
5.21(3) five percent from the January 1 next following the attainment of age 55 until
5.22December 31, 2011;
5.23(4) two percent from January 1, 2012 , until December 31, 2017; and
5.24(5) after December 31, 2017, the deferred annuity must not be augmented.
5.25(c) For a person who became a state employee after June 30, 2006, the annuity must be
5.26augmented at the following rate or rates:
5.27(1) 2.5 percent until December 31, 2011;
5.28(2) two percent from January 1, 2012, until December 31, 2017; and
5.29(3) after December 31, 2017, the deferred annuity must not be augmented.
6.1(c) The retirement annuity or disability benefit of, or the survivor benefit payable on
6.2behalf of, a former state employee who terminated service before July 1, 1997, which is not
6.3first payable until after June 30, 1997, must be increased on an actuarial equivalent basis
6.4to reflect the change in the postretirement interest rate actuarial assumption under section
6.5356.215, subdivision 8 , from five percent to six percent under a calculation procedure and
6.6the tables adopted by the board and approved by the actuary retained under section 356.214.
6.7EFFECTIVE DATE.This section is effective July 1, 2017.

6.8    Sec. 7. Minnesota Statutes 2016, section 352B.08, is amended by adding a subdivision to
6.9read:
6.10    Subd. 2b. Computation of deferred annuity. (a) Deferred annuities must be computed
6.11according to this chapter on the basis of allowable service before termination of service and
6.12augmented by interest compounded annually from the first day of the month following the
6.13month in which the member terminated service, or July 1, 1971, whichever is later, to the
6.14effective date of retirement.
6.15(b) For a person who became an employee before July 1, 2006, the annuity must be
6.16augmented at the following rate or rates:
6.17(1) five percent until January 1, 1981;
6.18(2) three percent from January 1, 1981, until December 31, 2011;
6.19(3) two percent from January 1, 2012, until December 31, 2017; and
6.20(4) after December 31, 2017, the deferred annuity must not be augmented.
6.21(c) For a person who became an employee after June 30, 2006, the annuity must be
6.22augmented as follows:
6.23(1) 2.5 percent until December 31, 2011;
6.24(2) two percent from January 1, 2012, until December 31, 2017; and
6.25(3) after December 31, 2017, the deferred annuity must not be augmented.
6.26(d) The mortality table and interest assumption used to compute the annuity must be
6.27those in effect when the member files application for annuity.
6.28EFFECTIVE DATE.This section is effective July 1, 2017.

7.1    Sec. 8. Minnesota Statutes 2016, section 352D.085, subdivision 1, is amended to read:
7.2    Subdivision 1. Combined service. Except as provided in section 356.30, 356.302, or
7.3356.303 , service under the unclassified program for which the employee has been credited
7.4with employee shares may be used for the limited purpose of qualifying for benefits under
7.5sections 352.115, 352.72, subdivision 1, 352.113, 354.44, 354.45, 354.48, and 354.60
7.6356.311. The service also may not be used to qualify for a disability benefit under section
7.7352.113 or 354.48 if a participant was under the unclassified program at the time of the
7.8disability. Also, the years of service and salary paid while the participant was in the
7.9unclassified program may not be used in determining the amount of benefits.
7.10EFFECTIVE DATE.This section is effective July 1, 2017.

7.11    Sec. 9. Minnesota Statutes 2016, section 490.121, subdivision 25, is amended to read:
7.12    Subd. 25. Tier I. "Tier I" is the benefit program of the retirement plan with a membership
7.13specified by section 490.1221, paragraph (b), and governed by sections 356.415, subdivisions
7.141 and subdivision 1f; and 490.121 to 490.133, except as modified in sections 490.121,
7.15subdivision 21f , paragraph (b); 490.1222; 490.123, subdivision 1a, paragraph (b); and
7.16490.124, subdivision 1, paragraphs (c) and (d).
7.17EFFECTIVE DATE.This section is effective July 1, 2017.

7.18    Sec. 10. Minnesota Statutes 2016, section 490.121, subdivision 26, is amended to read:
7.19    Subd. 26. Tier II. "Tier II" is the benefit program of the retirement plan with a
7.20membership specified by section 490.1221, paragraph (c), and governed by sections 356.415,
7.21subdivisions 1 and subdivision 1f; 490.121 to 490.133, as modified in section 490.121,
7.22subdivision 21f , paragraph (b); 490.1222; 490.123, subdivision 1a, paragraph (b); and
7.23490.124, subdivision 1 , paragraphs (c) and (d).
7.24EFFECTIVE DATE.This section is effective July 1, 2017.

7.25    Sec. 11. REPEALER.
7.26Minnesota Statutes 2016, sections 3A.12; 352.045; 352.72; and 352B.30, are repealed.
7.27EFFECTIVE DATE.This section is effective July 1, 2017.


7.30    Section 1. Minnesota Statutes 2016, section 353.30, subdivision 5, is amended to read:
8.1    Subd. 5. Actuarial reduction for early retirement. (a) This subdivision applies to a
8.2member who has become at least 55 years old and first became a public employee after
8.3June 30, 1989, and to any other member who has become at least 55 years old and whose
8.4annuity is higher when calculated under section 353.29, subdivision 3, paragraph (b), in
8.5conjunction with this subdivision than when calculated under section 353.29, subdivision
8.63 , paragraph (a), in conjunction with subdivision 1, 1a, 1b, or 1c. An employee who retires
8.7before normal retirement age shall be paid the retirement annuity provided in section 353.29,
8.8subdivision 3 , paragraph (b), reduced so that as described in paragraph (b) or (c), as
8.9applicable.
8.10(b) For members who retire on or after July 1, 2018, the reduced annuity is the actuarial
8.11equivalent of the annuity that would be payable to the employee if the employee deferred
8.12receipt of the annuity until normal retirement age and the annuity amount were augmented
8.13at an the applicable annual rate of three percent, compounded annually, from the day the
8.14annuity begins to accrue until the normal retirement age. The applicable annual rate is the
8.15rate in effect on the employee's effective date of retirement and shall be considered as fixed
8.16for the employee for the period until the employee reaches normal retirement age. The
8.17applicable annual rates are the following:
8.18(i) until June 30, 2018, three percent if the employee became an employee before July
8.191, 2006, and 2.5 percent if the employee became an employee after June 30, 2006;
8.20(ii) a rate that changes each month, beginning July 1, 2018, through June 30, 2023, which
8.21is determined by reducing the rate in item (i) to zero in equal monthly increments over the
8.22five-year period; and
8.23(iii) after June 30, 2023, zero percent.
8.24After June 30, 2023, actuarial equivalent, for the purpose of determining the reduced
8.25annuity commencing before normal retirement age under this paragraph, shall not take into
8.26account any augmentation.
8.27(c) For members who retire before July 1, 2018, the reduced annuity is the actuarial
8.28equivalent of the annuity that would be payable to the employee if the employee deferred
8.29receipt of the annuity until normal retirement age and the annuity amount were augmented
8.30at an annual rate of three percent, compounded annually, from the day the annuity begins
8.31to accrue until normal retirement age if the employee became an employee before July 1,
8.322006, and at 2.5 percent, compounded annually, from the day the annuity begins to accrue
8.33until the normal retirement age if the employee initially becomes became an employee after
8.34June 30, 2006.
9.1EFFECTIVE DATE.This section is effective for reduced annuities with an annuity
9.2starting date that is on or after July 1, 2018, notwithstanding the member's date of termination
9.3of public service.

9.4    Sec. 2. Minnesota Statutes 2016, section 353.34, subdivision 2, is amended to read:
9.5    Subd. 2. Refund with interest. (a) Except as provided in subdivision 1, any person who
9.6ceases to be a public employee is entitled to receive a refund in an amount equal to
9.7accumulated deductions with annual compound interest to the first day of the month in
9.8which the refund is processed.
9.9(b) Annual compound interest on a refund under paragraph (a) shall be as follows:
9.10(i) for a person who ceases to be a public employee before July 1, 2011, the refund
9.11interest is at the rate of six percent to June 30, 2011, at the rate of four percent after June
9.1230, 2011, to June 30, 2017, and at the rate of four three percent after June 30, 2011. 2017;
9.13(ii) For a person who ceases to be a public employee after July 1 June 30, 2011, and
9.14before July 1, 2017, the refund interest is at the rate of four percent. to June 30, 2017, and
9.15at the rate of three percent after June 30, 2017; and
9.16(iii) For a person who ceases to be a public employee after June 30, 2017, the refund
9.17interest is at the rate of three percent.
9.18(c) If a person repays a refund and subsequently applies for another refund, the repayment
9.19amount, including interest, is added to the fiscal year balance in which the repayment was
9.20made.
9.21(d) If the refund payable to a member is based on employee deductions that are
9.22determined to be invalid under section 353.27, subdivision 7, the interest payable on the
9.23invalid employee deductions is four percent.
9.24EFFECTIVE DATE.This section is effective July 1, 2017.

9.25    Sec. 3. Minnesota Statutes 2016, section 353.34, subdivision 3, is amended to read:
9.26    Subd. 3. Deferred annuity; eligibility; computation. (a) A member who is vested
9.27under section 353.01, subdivision 47, when termination of public service or termination of
9.28membership occurs has the option of leaving the accumulated deductions in the fund and
9.29being entitled to a deferred retirement annuity commencing at normal retirement age or to
9.30a deferred early retirement annuity under section 353.30, subdivision 1a, 1b, 1c, or 5.
10.1(b) The deferred annuity must be computed under section 353.29, subdivision 3, on the
10.2basis of the law in effect on the date of termination of public service or termination of
10.3membership, whichever is earlier, and must be augmented as provided in section 353.71,
10.4subdivision 2 paragraph (c).
10.5(c) The deferred annuity accruing under subdivision 3, section 353.68, subdivision 4,
10.6or section 356.311, must be computed on the basis of allowable service prior to the
10.7termination of public service and augmented by interest compounded annually from the
10.8first day of the month following the month in which the former member ceased to be a
10.9public employee, or July 1, 1971, whichever is later, to the effective date of retirement.
10.10(d) For a person who became a public employee before July 1, 2006, and who has a
10.11termination of public service before January 1, 2012, the deferred annuity must be augmented
10.12at the following rate or rates:
10.13(1) five percent until January 1, 1981;
10.14(2) three percent from January 1, 1981, until January 1 of the year following the year in
10.15which the former member attains age 55 or until December 31, 2011, whichever is earlier;
10.16(3) five percent from January 1 of the year following the year in which the former member
10.17attains age 55, or until December 31, 2011, whichever is earlier;
10.18(4) one percent from January 1, 2012, until December 31, 2017; and
10.19(5) after December 31, 2017, the deferred annuity must not be augmented.
10.20(e) For a person who became a public employee after June 30, 2006, and who has a
10.21termination of public service before January 1, 2012, the deferred annuity must be augmented
10.22at the following rate or rates:
10.23(1) 2.5 percent until December 31, 2011;
10.24(2) one percent from January 1, 2012, until December 31, 2017; and
10.25(3) after December 31, 2017, the deferred annuity must not be augmented.
10.26(f) For a person who has a termination of public service after December 31, 2011, the
10.27deferred annuity must not be augmented.
10.28(g) The retirement annuity or disability benefit of, or the survivor benefit payable on
10.29behalf of, a former member who terminated service before July 1, 1997, or the survivor
10.30benefit payable on behalf of a basic or police and fire member who was receiving disability
10.31benefits before July 1, 1997, which is first payable after June 30, 1997, must be increased
10.32on an actuarial equivalent basis to reflect the change in the postretirement interest rate
11.1actuarial assumption under section 356.215, subdivision 8, from five percent to six percent
11.2under a calculation procedure and tables adopted by the board and approved by the actuary
11.3retained under section 356.214.
11.4(c) (h) A former member qualified to apply for a deferred retirement annuity may revoke
11.5this option at any time before the commencement of deferred annuity payments by making
11.6application for a refund. The person is entitled to a refund of accumulated member
11.7contributions within 30 days following date of receipt of the application by the executive
11.8director.
11.9EFFECTIVE DATE.This section is effective July 1, 2017.

11.10    Sec. 4. REPEALER.
11.11Minnesota Statutes 2016, sections 353.27, subdivision 3b; and 353.71, are repealed.
11.12EFFECTIVE DATE.This section is effective July 1, 2017.


11.15    Section 1. Minnesota Statutes 2016, section 354.436, subdivision 3, is amended to read:
11.16    Subd. 3. Aid expiration. The aid amounts specified in this section terminate and this
11.17section expires on the October 1 next following the later of the following dates: (1) when
11.18the date on which the current assets of the Teachers Retirement Association fund equal or
11.19exceed the actuarial accrued liabilities of the fund as determined in the most recent actuarial
11.20valuation report for the Teachers Retirement Association fund by the actuary retained under
11.21section 356.214; or (2) when the member and employer contribution rates are first determined
11.22to be eligible for a reduction under section 354.42, subdivisions 4a, 4b, 4c, and 4d.
11.23EFFECTIVE DATE.This section is effective July 1, 2017.

11.24    Sec. 2. Minnesota Statutes 2016, section 354.44, subdivision 6, is amended to read:
11.25    Subd. 6. Computation of formula program retirement annuity. (a) The formula
11.26retirement annuity must be computed in accordance with the applicable provisions of the
11.27formulas stated in paragraph (b) or (d) on the basis of each member's average salary under
11.28section 354.05, subdivision 13a, for the period of the member's formula service credit.
11.29    (b) This paragraph, in conjunction with paragraph (c), applies to a person who first
11.30became a member of the association or a member of a pension fund listed in section 356.30,
12.1subdivision 3 , before July 1, 1989, unless paragraph (d), in conjunction with paragraph (e),
12.2produces a higher annuity amount, in which case paragraph (d) applies. The average salary
12.3as defined in section 354.05, subdivision 13a, multiplied by the following percentages per
12.4year of formula service credit shall determine the amount of the annuity to which the member
12.5qualifying therefor is entitled for service rendered before July 1, 2006:

12.6		Period		Coordinated Member		Basic Member
12.7 12.8		Each year of service during first ten		1.2 percent per year		2.2 percent per year
12.9 12.10		Each year of service thereafter		1.7 percent per year		2.7 percent per year

12.11    For service rendered on or after July 1, 2006, by a member other than a member who
12.12was a member of the former Duluth Teachers Retirement Fund Association between January
12.131, 2006, and June 30, 2015, and for service rendered on or after July 1, 2013, by a member
12.14who was a member of the former Duluth Teachers Retirement Fund Association between
12.15January 1, 2013, and June 30, 2015, the average salary as defined in section 354.05,
12.16subdivision 13a, multiplied by the following percentages per year of service credit, determines
12.17the amount the annuity to which the member qualifying therefor is entitled:

12.18		Period		Coordinated Member		Basic Member
12.19 12.20		Each year of service during first ten		1.4 percent per year		2.2 percent per year
12.21 12.22		Each year of service after ten years of service		1.9 percent per year		2.7 percent per year

12.23    (c)(i) This paragraph applies only to a person who first became a member of the
12.24association or a member of a pension fund listed in section 356.30, subdivision 3, before
12.25July 1, 1989, and whose annuity is higher when calculated under paragraph (b), in conjunction
12.26with this paragraph than when calculated under paragraph (d), in conjunction with paragraph
12.27(e).
12.28    (ii) Where any member retires prior to normal retirement age under a formula annuity,
12.29the member shall be paid a retirement annuity in an amount equal to the normal annuity
12.30provided in paragraph (b) reduced by one-quarter of one percent for each month that the
12.31member is under normal retirement age at the time of retirement except that for any member
12.32who has 30 or more years of allowable service credit, the reduction shall be applied only
12.33for each month that the member is under age 62.
12.34    (iii) Any member whose attained age plus credited allowable service totals 90 years is
12.35entitled, upon application, to a retirement annuity in an amount equal to the normal annuity
12.36provided in paragraph (b), without any reduction by reason of early retirement.
13.1    (d) This paragraph applies to a member who has become at least 55 years old and first
13.2became a member of the association after June 30, 1989, and to any other member who has
13.3become at least 55 years old and whose annuity amount when calculated under this paragraph
13.4and in conjunction with paragraph (e), is higher than it is when calculated under paragraph
13.5(b), in conjunction with paragraph (c). For a basic member, the average salary, as defined
13.6in section 354.05, subdivision 13a, multiplied by 2.7 percent for each year of service for a
13.7basic member determines the amount of the retirement annuity to which the basic member
13.8is entitled. The annuity of a basic member who was a member of the former Minneapolis
13.9Teachers Retirement Fund Association as of June 30, 2006, must be determined according
13.10to the annuity formula under the articles of incorporation of the former Minneapolis Teachers
13.11Retirement Fund Association in effect as of that date. For a coordinated member, the average
13.12salary, as defined in section 354.05, subdivision 13a, multiplied by 1.7 percent for each
13.13year of service rendered before July 1, 2006, and by 1.9 percent for each year of service
13.14rendered on or after July 1, 2006, for a member other than a member who was a member
13.15of the former Duluth Teachers Retirement Fund Association between January 1, 2006, and
13.16June 30, 2015, and by 1.9 percent for each year of service rendered on or after July 1, 2013,
13.17for a member of the former Duluth Teachers Retirement Fund Association between January
13.181, 2013, and June 30, 2015, determines the amount of the retirement annuity to which the
13.19coordinated member is entitled.
13.20    (e) This paragraph applies to a person who has become at least 55 years old and first
13.21becomes a member of the association after June 30, 1989, and to any other member who
13.22has become at least 55 years old and whose annuity is higher when calculated under
13.23paragraph (d) in conjunction with this paragraph than when calculated under paragraph (b),
13.24in conjunction with paragraph (c). An employee who retires under the formula annuity
13.25before the normal retirement age shall be paid the normal annuity provided in paragraph
13.26(d) reduced so that as described in clause (1) or (2), as applicable. Except in regards to
13.27section 354.46 and paragraph (g), this paragraph remains in effect until June 30, 2015.
13.28    (1) for employees who retire on or after July 1, 2018, the reduced annuity is the actuarial
13.29equivalent of the annuity that would be payable to the employee if the employee deferred
13.30receipt of the annuity until normal retirement age and the annuity amount were augmented
13.31at an the applicable annual rate of three percent, compounded annually, from the day the
13.32annuity begins to accrue until the normal retirement age. The applicable annual rate is the
13.33rate in effect on the employee's effective date of retirement and shall be considered as fixed
13.34for the employee for the period until the employee reaches normal retirement age. The
13.35applicable annual rates are the following:
14.1(i) until June 30, 2018, three percent if the employee became an employee before July
14.21, 2006, and 2.5 percent if the employee became an employee after June 30, 2006;
14.3(ii) a rate that changes each month, beginning July 1, 2018, through June 30, 2023, which
14.4is determined by reducing the rate in item (i) to zero in equal monthly increments over the
14.5five-year period; and
14.6(iii) after June 30, 2023, zero percent.
14.7After June 30, 2023, actuarial equivalent, for the purpose of determining the reduced
14.8annuity commencing before normal retirement age under this clause, shall not take into
14.9account any augmentation.
14.10    (2) for members who retire before July 1, 2018, the reduced annuity is the actuarial
14.11equivalent of the annuity that would be payable to the employee if the employee deferred
14.12receipt of the annuity until normal retirement age and the annuity amount were augmented
14.13at an annual rate of three percent, compounded annually, from the day the annuity begins
14.14to accrue until normal retirement age if the employee became an employee before July 1,
14.152006, and at 2.5 percent, compounded annually, from the day the annuity begins to accrue
14.16until normal retirement age if the employee becomes became an employee after June 30,
14.172006. Except in regards to section 354.46, this paragraph remains in effect until June 30,
14.182015.
14.19(f) After June 30, 2020, this paragraph applies to a person who has become at least 55
14.20years old and first becomes a member of the association after June 30, 1989, and to any
14.21other member who has become at least 55 years old and whose annuity is higher when
14.22calculated under paragraph (d) in conjunction with this paragraph than when calculated
14.23under paragraph (b) in conjunction with paragraph (c). An employee who retires under the
14.24formula annuity before the normal retirement age is entitled to receive the normal annuity
14.25provided in paragraph (d) reduced as described in clause (1) or (2), as applicable.
14.26For a person who (1) if the member retires when the member is at least age 62 or older
14.27and has at least 30 years of service, the annuity must be reduced by an early reduction factor
14.28of six percent per year of the annuity that would be payable to the employee if the employee
14.29deferred receipt of the annuity and the annuity amount were augmented at an annual rate
14.30of three percent, compounded annually, from the day the annuity begins to accrue until the
14.31normal retirement age if the employee became an employee before July 1, 2006, and at 2.5
14.32percent compounded annually if the employee became an employee after June 30, 2006.
14.33For a person who
15.1The applicable annual rate is the rate in effect on the employee's effective date of
15.2retirement and shall be considered as fixed for the employee for the period until the employee
15.3reaches normal retirement age. The applicable annual rates are the following:
15.4(2) if the member retires when the member is not at least younger than age 62 or older
15.5and does not have at least or with fewer than 30 years of service, the annuity would must
15.6be reduced by an early reduction factor of for each year that the member's age of retirement
15.7precedes normal retirement age. The early reduction factors are four percent per year for
15.8ages 55 through 59 and seven percent per year for ages 60 through 65.of The resulting
15.9annuity that would be payable to the employee must be further adjusted to take into account
15.10augmentation as if the employee deferred receipt of the annuity until normal retirement age
15.11and the annuity amount were augmented at an the applicable annual rate of three percent,
15.12compounded annually, from the day the annuity begins to accrue until the normal retirement
15.13age if the employee became an employee before July 1, 2006, and at 2.5 percent compounded
15.14annually if the employee became an employee after June 30, 2006.The applicable annual
15.15rate is the rate in effect on the employee's effective date of retirement and shall be considered
15.16as fixed for the employee for the period until the employee reaches normal retirement age.
15.17The applicable annual rates are the following:
15.18(i) until June 30, 2018, three percent if the employee became an employee before July
15.191, 2006, and 2.5 percent if the employee became an employee after June 30, 2006;
15.20(ii) a rate that changes each month, beginning July 1, 2018, through June 30, 2023, which
15.21is determined by reducing the rate in item (i) to zero in equal monthly increments over the
15.22five-year period; and
15.23(iii) after June 30, 2023, zero percent.
15.24After June 30, 2023, the reduced annuity commencing before normal retirement age
15.25under this clause shall not take into account any augmentation.
15.26(g) After June 30, 2015, and before July 1, 2020, for a person who would have a reduced
15.27retirement annuity under either paragraph (e) or (f) if they were applicable, the employee
15.28is entitled to receive a reduced annuity which must be calculated using a blended reduction
15.29factor augmented monthly by 1/60 of the difference between the reduction required under
15.30paragraph (e) and the reduction required under paragraph (f).
15.31    (h) No retirement annuity is payable to a former employee with a salary that exceeds 95
15.32percent of the governor's salary unless and until the salary figures used in computing the
15.33highest five successive years average salary under paragraph (a) have been audited by the
16.1Teachers Retirement Association and determined by the executive director to comply with
16.2the requirements and limitations of section 354.05, subdivisions 35 and 35a.
16.3EFFECTIVE DATE.This section is effective July 1, 2017.

16.4    Sec. 3. Minnesota Statutes 2016, section 354.49, subdivision 2, is amended to read:
16.5    Subd. 2. Calculation. (a) Except as provided in section 354.44, subdivision 1, any person
16.6who ceases to be a member by reason of termination of teaching service, is entitled to receive
16.7a refund in an amount equal to the accumulated deductions credited to the account plus
16.8interest compounded annually using the following interest rates:
16.9(1) before July 1, 1957, no interest accrues;
16.10(2) July 1, 1957, to June 30, 2011, six percent; and
16.11(3) after June 30 July 1, 2011, to June 30, 2017, four percent; and
16.12(4) after June 30, 2017, three percent.
16.13For the purpose of this subdivision, interest must be computed on fiscal year end balances
16.14to the first day of the month in which the refund is issued.
16.15(b) If the person has received permanent disability payments under section 354.48, the
16.16refund amount must be reduced by the amount of those payments.

16.17    Sec. 4. Minnesota Statutes 2016, section 354.55, subdivision 11, is amended to read:
16.18    Subd. 11. Deferred annuity; augmentation. (a) Any person covered under section
16.19354.44, subdivision 6 , who ceases to render teaching service, may leave the person's
16.20accumulated deductions in the fund for the purpose of receiving a deferred annuity at
16.21retirement.
16.22(b) The amount of the deferred retirement annuity is determined by section 354.44,
16.23subdivision 6 , and must be augmented as provided in this subdivision. The required reserves
16.24for the annuity which had accrued when the member ceased to render teaching service must
16.25be augmented, as further specified in this subdivision, by the applicable interest rate
16.26compounded annually from the first day of the month following the month during which
16.27the member ceased to render teaching service to the effective date of retirement.
16.28(c) No augmentation is not creditable if the deferral period is less than three months or
16.29if deferral commenced before July 1, 1971.
17.1(d) For persons who became covered employees before July 1, 2006, with a deferral
17.2period commencing after June 30, 1971, the annuity must be augmented as follows:
17.3(1) five percent interest compounded annually until January 1, 1981;
17.4(2) three percent interest compounded annually from January 1, 1981, until January 1
17.5of the year following the year in which the deferred annuitant attains age 55 or until June
17.630, 2012, whichever is earlier;
17.7(3) five percent interest compounded annually from the date established in clause (2) to
17.8the effective date of retirement or until June 30, 2012, whichever is earlier; and
17.9(4) two percent interest compounded annually after June 30, 2012 from July 1, 2012,
17.10until June 30, 2018; and
17.11(5) after June 30, 2018, the deferred annuity must not be augmented.
17.12(e) For persons who become covered employees after June 30, 2006, the interest rate
17.13used to augment the deferred annuity is must be augmented as follows:
17.14(1) 2.5 percent interest compounded annually until June 30, 2012, or until the effective
17.15date of retirement, whichever is earlier, and;
17.16(2) two percent interest compounded annually after June 30 from July 1, 2012, until
17.17June 30, 2018; and
17.18(3) after June 30, 2018, the deferred annuity must not be augmented.
17.19(f) If a person has more than one period of uninterrupted service, a separate average
17.20salary determined under section 354.44, subdivision 6, must be used for each period and
17.21the required reserves related to each period must be augmented as specified in this
17.22subdivision. The sum of the augmented required reserves is the present value of the annuity.
17.23For the purposes of this subdivision, "period of uninterrupted service" means a period of
17.24covered teaching service during which the member has not been separated from active
17.25service for more than one fiscal year.
17.26(g) If a person repays a refund, the service restored by the repayment must be considered
17.27as continuous with the next period of service for which the person has allowable service
17.28credit in the Teachers Retirement Association.
17.29(h) If a person does not render teaching service in any one fiscal year or more consecutive
17.30fiscal years and then resumes teaching service, the formula percentages used from the date
17.31of the resumption of teaching service must be those applicable to new members.
18.1(i) The mortality table and interest rate actuarial assumption used to compute the annuity
18.2must be the applicable mortality table established by the board under section 354.07,
18.3subdivision 1 , and the interest rate actuarial assumption under section 356.215 in effect
18.4when the member retires.
18.5(j) (f) In no case may the annuity payable under this subdivision be less than the amount
18.6of annuity payable under section 354.44, subdivision 6.
18.7(k) (g) The requirements and provisions for retirement before normal retirement age
18.8contained in section 354.44, subdivision 6, also apply to an employee fulfilling the
18.9requirements with a combination of service as provided in section 354.60 356.311.
18.10(l) (h) The augmentation provided by this subdivision applies to the benefit provided in
18.11section 354.46, subdivision 2.
18.12(m) (i) The augmentation provided by this subdivision does not apply to any period in
18.13which a person is on an approved leave of absence from an employer unit covered by the
18.14provisions of this chapter.
18.15(n) (j) The retirement annuity or disability benefit of, or the survivor benefit payable on
18.16behalf of, a former teacher who terminated service before July 1, 1997, which is not first
18.17payable until after June 30, 1997, must be increased on an actuarial equivalent basis to
18.18reflect the change in the postretirement interest rate actuarial assumption under section
18.19356.215, subdivision 8 , from five percent to six percent under a calculation procedure and
18.20tables adopted by the board as recommended by an approved actuary and approved by the
18.21actuary retained under section 356.214.
18.22EFFECTIVE DATE.This section is effective July 1, 2017.

18.23    Sec. 5. REPEALER.
18.24Minnesota Statutes 2016, sections 354.42, subdivisions 4a, 4b, 4c, and 4d; and 354.60,
18.25are repealed.
18.26EFFECTIVE DATE.This section is effective July 1, 2017.


18.29    Section 1. Minnesota Statutes 2016, section 354A.011, subdivision 3a, is amended to read:
18.30    Subd. 3a. Actuarial equivalent. "Actuarial equivalent" means the condition of one
18.31annuity or benefit having an equal actuarial present value as another annuity or benefit,
19.1determined as of a given date with each actuarial present value based on the appropriate
19.2mortality table adopted by the appropriate board of trustees based on the experience of that
19.3retirement fund association as recommended by the actuary retained under section 356.214,
19.4and approved under section 356.215, subdivision 18, and using the applicable preretirement
19.5or postretirement interest rate investment return assumption specified in section 356.215,
19.6subdivision 8 .
19.7EFFECTIVE DATE.This section is effective July 1, 2017.

19.8    Sec. 2. Minnesota Statutes 2016, section 354A.29, subdivision 7, is amended to read:
19.9    Subd. 7. Eligibility for payment of Postretirement adjustments. (a) Annually, after
19.10June 30, the board of trustees of the St. Paul Teachers Retirement Fund Association must
19.11determine the amount of any postretirement adjustment using the procedures in this
19.12subdivision and subdivision 8 or 9, whichever is applicable.
19.13(b) On January 1 (a) Except as set forth in paragraph (c), each person who has been
19.14receiving an annuity or benefit under the articles of incorporation, the bylaws, or this chapter,
19.15whose effective date of benefit commencement occurred on or before July 1 of the calendar
19.16year immediately before the adjustment, is eligible to receive a an annual postretirement
19.17increase as specified in subdivision 8 or 9. adjustment, effective as of each January 1, as
19.18follows:
19.19(1) There shall be no postretirement adjustment on January 1, 2018, and January 1, 2019;
19.20(2) The postretirement adjustment shall be one percent on January 1, 2020, and each
19.21January 1 thereafter.
19.22(b) The amount determined under paragraph (a), clause (2), is the full postretirement
19.23adjustment to be applied as a permanent increase to the regular payment of each eligible
19.24member on January 1 of the next calendar year. For any eligible member whose effective
19.25date of benefit commencement occurred after January 1 of the calendar year immediately
19.26before the postretirement adjustment is applied, the amount determined under paragraph
19.27(a), clause (2), must be reduced by 50 percent.
19.28(c) Each person who retires on or after January 1, 2020, is entitled to an annual
19.29postretirement adjustment, effective as of each January 1, beginning with the year following
19.30the year in which the member attains normal retirement age.
19.31EFFECTIVE DATE.This section is effective the day following final enactment.

20.1    Sec. 3. Minnesota Statutes 2016, section 354A.31, subdivision 7, is amended to read:
20.2    Subd. 7. Reduction for early retirement. (a) This subdivision applies to a person who
20.3has become at least 55 years old and first becomes a coordinated member after June 30,
20.41989, and to any other coordinated member who has become at least 55 years old and whose
20.5annuity is higher when calculated using the retirement annuity formula percentage in
20.6subdivision 4, paragraph (d), or subdivision 4a, paragraph (d), as applicable, in conjunction
20.7with this subdivision than when calculated under subdivision 4, paragraph (c), or subdivision
20.84a, paragraph (c), in conjunction with subdivision 6. An employee who retires under the
20.9formula annuity before the normal retirement age shall be paid the normal annuity reduced
20.10as described in paragraph (b) if the person retires on or after July 1, 2018, or in paragraph
20.11(c) if the person retires before July 1, 2018, as applicable.
20.12(b) A coordinated member who retires before the normal retirement age and on or after
20.13July 1, 2018, is entitled to receive a retirement annuity calculated using the retirement
20.14annuity formula percentage in subdivision 4, paragraph (d), or subdivision 4a, paragraph
20.15(d), whichever applies, reduced as described in clause (1) or (2), as applicable.
20.16(1) if the member retires when the member is younger than age 62 or with fewer than
20.1730 years of service, the annuity must be reduced by an early reduction factor for each year
20.18that the member's age of retirement precedes normal retirement age. The early reduction
20.19factors are four percent per year for ages 55 through 59 and seven percent per year for ages
20.2060 through 65. The resulting annuity must be further adjusted to take into account
20.21augmentation as if the employee had deferred receipt of the annuity until normal retirement
20.22age and the annuity were augmented at the applicable annual rate, compounded annually,
20.23from the day the annuity begins to accrue until normal retirement age. The applicable annual
20.24rate is the rate in effect on the employee's effective date of retirement and shall be considered
20.25as fixed for the employee for the period until the employee reaches normal retirement age.
20.26The applicable annual rates are the following:
20.27(i) until June 30, 2018, 2.5 percent;
20.28(ii) a rate that changes each month, beginning July 1, 2018, through June 30, 2023, which
20.29is determined by reducing the rate in item (i) to zero in equal monthly increments over the
20.30five-year period; and
20.31(iii) after June 30, 2023, zero percent.
20.32After June 30, 2023, the reduced annuity commencing before normal retirement age
20.33under this clause shall not take into account any augmentation.
21.1(2) If the member retires when the member is at least age 62 or older and has at least 30
21.2years of service, the member is entitled to receive a retirement annuity calculated using the
21.3retirement annuity formula percentage in subdivision 4, paragraph (d), or subdivision 4a,
21.4paragraph (c), whichever applies, multiplied by the applicable early retirement factor
21.5specified for members "Age 62 or older with 30 years of service" in the table in paragraph
21.6(c).
21.7(c) A coordinated member who retires before the normal retirement age and before July
21.81, 2018, is entitled to receive a retirement annuity calculated using the retirement annuity
21.9formula percentage in subdivision 4, paragraph (d), or subdivision 4a, paragraph (d),
21.10whichever applies, multiplied by the applicable early retirement factor specified below:

21.11		Under age 62	Age 62 or older
21.12		or less than 30 years of service	with 30 years of service

21.13	Normal retirement age:	65	66	65	66
21.14	Age at retirement
21.15	55	0.5376	0.4592
21.16	56	0.5745	0.4992
21.17	57	0.6092	0.5370
21.18	58	0.6419	0.5726
21.19	59	0.6726	0.6062
21.20	60	0.7354	0.6726
21.21	61	0.7947	0.7354
21.22	62	0.8507	0.7947	0.8831	0.8389
21.23	63	0.9035	0.8507	0.9246	0.8831
21.24	64	0.9533	0.9035	0.9635	0.9246
21.25	65	1.0000	0.9533	1.0000	0.9635
21.26	66		1.0000		1.0000

21.27For normal retirement ages between ages 65 and 66, the early retirement factors must
21.28be determined by linear interpolation between the early retirement factors applicable for
21.29normal retirement ages 65 and 66.
21.30EFFECTIVE DATE.This section is effective July 1, 2017.

21.31    Sec. 4. Minnesota Statutes 2016, section 354A.37, subdivision 2, is amended to read:
21.32    Subd. 2. Eligibility for deferred retirement annuity. (a) Any coordinated member
21.33who ceases to render teaching services for the school district in which the teachers retirement
21.34fund association is located, with sufficient allowable service credit to meet the minimum
22.1service requirements specified in section 354A.31, subdivision 1, shall be entitled to a
22.2deferred retirement annuity in lieu of a refund under subdivision 1.
22.3(b) The deferred retirement annuity must be computed under section 354A.31 and shall
22.4be augmented as provided in this subdivision by the applicable interest rate compounded
22.5annually from the first day of the month following the month during which the member
22.6ceased to render teaching service to the effective date of retirement. There is no augmentation
22.7if this period is less than three months.
22.8(c) The deferred annuity commences upon application after the person on deferred status
22.9attains at least the minimum age specified in section 354A.31, subdivision 1.
22.10(b) The monthly annuity amount that had accrued when the member ceased to render
22.11teaching service must be augmented from the first day of the month following the month
22.12during which the member ceased to render teaching service to the effective date of retirement.
22.13There is no augmentation if this period is less than three months. The rate of augmentation
22.14is
22.15(d) For a person who became a covered employee before July 1, 2006, the annuity must
22.16be augmented as follows:
22.17(1) three percent compounded annually until January 1 of the year following the year
22.18in which the former member attains age 55, or until June 30, 2012, whichever is earlier;
22.19(2) five percent compounded annually after that date to July 1 from the January 1, next
22.20following the attainment of age 55 or until June 30, 2012, and;
22.21(3) two percent compounded annually after that date to the effective date of retirement
22.22if the employee became an employee before July 1, 2006, and at from July 1, 2012, until
22.23June 30, 2018; and
22.24(4) after June 30, 2018, the deferred annuity must not be augmented.
22.25(e) For a person who became a covered employee after June 30, 2006, the annuity must
22.26be augmented as follows:
22.27(1) 2.5 percent compounded annually to July 1, 2012, and until June 30, 2012;
22.28(2) two percent compounded annually after that date to the effective date of retirement
22.29if the employee became an employee after June 30, 2006 from July 1, 2012, until June 30,
22.302018; and
22.31. If a person has more than one period of uninterrupted service, a separate average salary
22.32determined under section 354A.31 must be used for each period, and the monthly annuity
23.1amount related to each period must be augmented as provided in this subdivision. The sum
23.2of the augmented monthly annuity amounts determines the total deferred annuity payable.
23.3If a person repays a refund, the service restored by the repayment must be considered as
23.4continuous with the next period of service for which the person has credit with the fund. If
23.5a person does not render teaching services in any one fiscal year or more consecutive fiscal
23.6years and then resumes teaching service, the formula percentages used from the date of
23.7resumption of teaching service are those applicable to new members. The mortality table
23.8and interest assumption used to compute the annuity are the table established by the fund
23.9to compute other annuities, and the interest assumption under section 356.215 in effect
23.10when the member retires. A period of uninterrupted service for the purpose of this subdivision
23.11means a period of covered teaching service during which the member has not been separated
23.12from active service for more than one fiscal year.
23.13(3) after June 30, 2018, the deferred annuity must not be augmented.
23.14(c) (f) The augmentation provided by this subdivision applies to the benefit provided in
23.15section 354A.35, subdivision 2.
23.16(g) The augmentation provided by this subdivision does not apply to any period in which
23.17a person is on an approved leave of absence from an employer unit.
23.18EFFECTIVE DATE.This section is effective July 1, 2017.

23.19    Sec. 5. Minnesota Statutes 2016, section 354A.37, subdivision 3, is amended to read:
23.20    Subd. 3. Computation of refund amount. A former coordinated member who qualifies
23.21for a refund under subdivision 1 is entitled to receive a refund equal to the amount of the
23.22former coordinated member's accumulated employee contributions with interest at the rate
23.23of following rates for the applicable period:
23.24(a) Six percent per annum compounded annually to July 1, 2011, if the person is a former
23.25member of the St. Paul Teachers Retirement Fund Association, and;
23.26(b) four percent per annum compounded annually to July 1, 2017; and
23.27(c) three percent per annum compounded annually thereafter.

23.28    Sec. 6. REPEALER.
23.29(a) Minnesota Statutes 2016, section 354A.29, subdivisions 8 and 9, are repealed.
23.30(b) Minnesota Statutes 2016, section 354A.39, is repealed.
24.1EFFECTIVE DATE.Paragraph (a) is effective the day following final enactment.
24.2Paragraph (b) is effective July 1, 2017.


24.6    Section 1. Minnesota Statutes 2016, section 356.215, subdivision 8, is amended to read:
24.7    Subd. 8. Interest and salary Actuarial assumptions. (a) The actuarial valuation must
24.8use the applicable following interest investment return assumption:
24.9(1) select and ultimate interest rate assumption

24.10 24.11	plan	ultimate interest rate assumption
24.12	teachers retirement plan	8.5%

24.13The select preretirement interest rate assumption for the period through June 30, 2017,
24.14is eight percent.
24.15(2) single rate interest rate assumption

24.16 24.17 24.18	plan	interest rate investment return assumption
24.19	general state employees retirement plan	8 7.5%
24.20	correctional state employees retirement plan	8 7.5
24.21	State Patrol retirement plan	8 7.5
24.22 24.23 24.24	legislators retirement plan, and for the constitutional officers calculation of total plan liabilities	0
24.25	judges retirement plan	8 7.5
24.26	general public employees retirement plan	8 7.5
24.27	public employees police and fire retirement plan	8 7.5
24.28 24.29	local government correctional service retirement plan	8 7.5
24.30	teachers retirement plan	7.5
24.31	St. Paul teachers retirement plan	87.5
24.32	Bloomington Fire Department Relief Association	6
24.33 24.34	local monthly benefit volunteer firefighter relief associations	5
24.35 24.36	monthly benefit retirement plans in the statewide volunteer firefighter retirement plan	6

25.1(b)(1) If funding stability has been attained, The actuarial valuation for each of the
25.2covered retirement plans listed in section 356.415, subdivision 2, must use a take into account
25.3the postretirement adjustment rate actuarial assumption equal to the postretirement adjustment
25.4rate or rates applicable to the plan as specified in section 354A.27, subdivision 7; 354A.29,
25.5subdivision 9 7 ; or 356.415, subdivision 1, whichever applies.
25.6(2) If funding stability has not been attained, the valuation must use a select postretirement
25.7adjustment rate actuarial assumption equal to the postretirement adjustment rate specified
25.8in section 354A.27, subdivision 6a; 354A.29, subdivision 8; or 356.415, subdivision 1a,
25.91b, 1c, 1d, 1e, or 1f, whichever applies, for a period ending when the approved actuary
25.10estimates that the plan will attain the defined funding stability measure, and thereafter an
25.11ultimate postretirement adjustment rate actuarial assumption equal to the postretirement
25.12adjustment rate under section 354A.27, subdivision 7; 354A.29, subdivision 9; or 356.415,
25.13subdivision 1 , for the applicable period or periods beginning when funding stability is
25.14projected to be attained.
25.15    (c) The actuarial valuation must use the applicable following single rate future salary
25.16increase assumption, the applicable following modified single rate future salary increase
25.17assumption, or the applicable following graded rate future salary increase assumption:
25.18    (1) single rate future salary increase assumption

25.19	plan	future salary increase assumption
25.20	legislators retirement plan		5%
25.21	judges retirement plan		2.75
25.22	Bloomington Fire Department Relief Association		4

25.23    (2) age-related future salary increase age-related select and ultimate future salary increase
25.24assumption or graded rate future salary increase assumption

25.25	plan	future salary increase assumption
25.26	local government correctional service retirement plan	assumption B
25.27	St. Paul teachers retirement plan	assumption A

25.28For plans other than the St. Paul teachers
25.29retirement plan and the local government
25.30correctional service retirement plan, the select
25.31calculation is: during the designated select
25.32period, a designated percentage rate is
25.33multiplied by the result of the designated
25.34integer minus T, where T is the number of
26.1completed years of service, and is added to
26.2the applicable future salary increase
26.3assumption. The designated select period is
26.4ten years and the designated integer is ten for
26.5the local government correctional service
26.6retirement plan and 15 for the St. Paul
26.7Teachers Retirement Fund Association. The
26.8designated percentage rate is 0.2 percent for
26.9the St. Paul Teachers Retirement Fund
26.10Association.
26.11    The ultimate future salary increase assumption is:

26.12	age	A	B
26.13	16	5.9%	8.75%
26.14	17	5.9	8.75
26.15	18	5.9	8.75
26.16	19	5.9	8.75
26.17	20	5.9	8.75
26.18	21	5.9	8.5
26.19	22	5.9	8.25
26.20	23	5.85	8
26.21	24	5.8	7.75
26.22	25	5.75	7.5
26.23	26	5.7	7.25
26.24	27	5.65	7
26.25	28	5.6	6.75
26.26	29	5.55	6.5
26.27	30	5.5	6.5
26.28	31	5.45	6.25
26.29	32	5.4	6.25
26.30	33	5.35	6.25
26.31	34	5.3	6
26.32	35	5.25	6
26.33	36	5.2	5.75
26.34	37	5.15	5.75
26.35	38	5.1	5.75
26.36	39	5.05	5.5
26.37	40	5	5.5
27.1	41	4.95	5.5
27.2	42	4.9	5.25
27.3	43	4.85	5
27.4	44	4.8	5
27.5	45	4.75	4.75
27.6	46	4.7	4.75
27.7	47	4.65	4.75
27.8	48	4.6	4.75
27.9	49	4.55	4.75
27.10	50	4.5	4.75
27.11	51	4.45	4.75
27.12	52	4.4	4.75
27.13	53	4.35	4.75
27.14	54	4.3	4.75
27.15	55	4.25	4.5
27.16	56	4.2	4.5
27.17	57	4.15	4.25
27.18	58	4.1	4
27.19	59	4.05	4
27.20	60	4	4
27.21	61	4	4
27.22	62	4	4
27.23	63	4	4
27.24	64	4	4
27.25	65	4	3.75
27.26	66	4	3.75
27.27	67	4	3.75
27.28	68	4	3.75
27.29	69	4	3.75
27.30	70	4	3.75

27.31(3) service-related ultimate future salary increase assumption

27.32 27.33	general state employees retirement plan of the Minnesota State Retirement System	assumption A
27.34 27.35	general employees retirement plan of the Public Employees Retirement Association	assumption B
27.36	Teachers Retirement Association	assumption C
27.37	public employees police and fire retirement plan	assumption D
27.38	State Patrol retirement plan	assumption E
28.1 28.2	correctional state employees retirement plan of the Minnesota State Retirement System	assumption F

28.3 28.4	service length	A	B	C	D	E	F
28.5	1	10.25%	11.78%	12%	12.75%	7.75%	5.75%
28.6	2	7.85	8.65	9	10.75	7.25	5.6
28.7	3	6.65	7.21	8	8.75	6.75	5.45
28.8	4	5.95	6.33	7.5	7.75	6.5	5.3
28.9	5	5.45	5.72	7.25	6.25	6.25	5.15
28.10	6	5.05	5.27	7	5.85	6	5
28.11	7	4.75	4.91	6.85	5.55	5.75	4.85
28.12	8	4.45	4.62	6.7	5.35	5.6	4.7
28.13	9	4.25	4.38	6.55	5.15	5.45	4.55
28.14	10	4.15	4.17	6.4	5.05	5.3	4.4
28.15	11	3.95	3.99	6.25	4.95	5.15	4.3
28.16	12	3.85	3.83	6	4.85	5	4.2
28.17	13	3.75	3.69	5.75	4.75	4.85	4.1
28.18	14	3.55	3.57	5.5	4.65	4.7	4
28.19	15	3.45	3.45	5.25	4.55	4.55	3.9
28.20	16	3.35	3.35	5	4.55	4.4	3.8
28.21	17	3.25	3.26	4.75	4.55	4.25	3.7
28.22	18	3.25	3.25	4.5	4.55	4.1	3.6
28.23	19	3.25	3.25	4.25	4.55	3.95	3.5
28.24	20	3.25	3.25	4	4.55	3.8	3.5
28.25	21	3.25	3.25	3.9	4.45	3.75	3.5
28.26	22	3.25	3.25	3.8	4.35	3.75	3.5
28.27	23	3.25	3.25	3.7	4.25	3.75	3.5
28.28	24	3.25	3.25	3.6	4.25	3.75	3.5
28.29	25	3.25	3.25	3.5	4.25	3.75	3.5
28.30	26	3.25	3.25	3.5	4.25	3.75	3.5
28.31	27	3.25	3.25	3.5	4.25	3.75	3.5
28.32	28	3.25	3.25	3.5	4.25	3.75	3.5
28.33	29	3.25	3.25	3.5	4.25	3.75	3.5
28.34	30 or more	3.25	3.25	3.5	4.25	3.75	3.5

28.35    (d) The actuarial valuation must use the applicable following payroll growth assumption
28.36for calculating the amortization requirement for the unfunded actuarial accrued liability
28.37where the amortization retirement is calculated as a level percentage of an increasing payroll:

28.38	plan	payroll growth assumption
29.1 29.2	general state employees retirement plan of the Minnesota State Retirement System	3.5%
29.3	correctional state employees retirement plan	3.5
29.4	State Patrol retirement plan	3.5
29.5	judges retirement plan	2.75
29.6 29.7	general employees retirement plan of the Public Employees Retirement Association	3.5
29.8	public employees police and fire retirement plan	3.5
29.9	local government correctional service retirement plan	3.5
29.10	teachers retirement plan	3.75
29.11	St. Paul teachers retirement plan	4

29.12    (e) The assumptions set forth in paragraphs (c) and (d) continue to apply, unless a
29.13different salary assumption or a different payroll increase assumption:
29.14    (1) has been proposed by the governing board of the applicable retirement plan;
29.15    (2) is accompanied by the concurring recommendation of the actuary retained under
29.16section 356.214, subdivision 1, if applicable, or by the approved actuary preparing the most
29.17recent actuarial valuation report if section 356.214 does not apply; and
29.18    (3) has been approved or deemed approved under subdivision 18.
29.19EFFECTIVE DATE.This section is effective July 1, 2017.

29.20    Sec. 2. Minnesota Statutes 2016, section 356.215, subdivision 9, is amended to read:
29.21    Subd. 9. Other assumptions. The (a) Each plan's actuarial valuation must use
29.22assumptions concerning base mortality rates, disability, retirement, withdrawal, retirement
29.23age, and any other relevant demographic or economic factor. These assumptions must be
29.24set at levels consistent with those determined in the most recent quadrennial experience
29.25study completed under subdivision 16, if required, or representative of the best estimate of
29.26future experience as recommended by the plan's approved actuary, if a quadrennial experience
29.27study is not required.
29.28(b) The actuarial valuation may use an assumption concerning future mortality
29.29improvement. This assumption may be set at levels consistent with those determined in the
29.30most recent mortality improvement scale published by the Society of Actuaries or as
29.31otherwise recommended by the plan's approved actuary.
29.32(c) The actuarial valuation must contain an exhibit indicating any the actuarial
29.33assumptions used in preparing the valuation report.
30.1EFFECTIVE DATE.This section is effective July 1, 2017.

30.2    Sec. 3. Minnesota Statutes 2016, section 356.215, subdivision 11, is amended to read:
30.3    Subd. 11. Amortization contributions. (a) In addition to the exhibit indicating the level
30.4normal cost, the actuarial valuation of the retirement plan must contain an exhibit for financial
30.5reporting purposes indicating the additional annual contribution sufficient to amortize the
30.6unfunded actuarial accrued liability and must contain an exhibit for contribution
30.7determination purposes indicating the additional contribution sufficient to amortize the
30.8unfunded actuarial accrued liability. For the retirement plans listed in subdivision 8, paragraph
30.9(c), but excluding the legislators retirement plan, the additional contribution must be
30.10calculated on a level percentage of covered payroll basis by the established date for full
30.11funding in effect when the valuation is prepared, assuming annual payroll growth at the
30.12applicable percentage rate set forth in subdivision 8, paragraph (d). For all other retirement
30.13plans and for the legislators retirement plan, the additional annual contribution must be
30.14calculated on a level annual dollar amount basis.
30.15    (b) For any retirement plan other than a retirement plan governed by paragraph (d), (e),
30.16(f), (g), (h), (i), or (j), if there has not been a change in the actuarial assumptions used for
30.17calculating the actuarial accrued liability of the fund, a change in the benefit plan governing
30.18annuities and benefits payable from the fund, a change in the actuarial cost method used in
30.19calculating the actuarial accrued liability of all or a portion of the fund, or a combination
30.20of the three, which change or changes by itself or by themselves without inclusion of any
30.21other items of increase or decrease produce a net increase in the unfunded actuarial accrued
30.22liability of the fund, the established date for full funding is the first actuarial valuation date
30.23occurring after June 1, 2020.
30.24    (c) For any retirement plan, if there has been a change in any or all of the actuarial
30.25assumptions used for calculating the actuarial accrued liability of the fund, a change in the
30.26benefit plan governing annuities and benefits payable from the fund, a change in the actuarial
30.27cost method used in calculating the actuarial accrued liability of all or a portion of the fund,
30.28or a combination of the three, and the change or changes, by itself or by themselves and
30.29without inclusion of any other items of increase or decrease, produce a net increase in the
30.30unfunded actuarial accrued liability in the fund, the established date for full funding must
30.31be determined using the following procedure:
30.32    (i) the unfunded actuarial accrued liability of the fund must be determined in accordance
30.33with the plan provisions governing annuities and retirement benefits and the actuarial
30.34assumptions in effect before an applicable change;
31.1    (ii) the level annual dollar contribution or level percentage, whichever is applicable,
31.2needed to amortize the unfunded actuarial accrued liability amount determined under item
31.3(i) by the established date for full funding in effect before the change must be calculated
31.4using the interest assumption specified in subdivision 8 in effect before the change;
31.5    (iii) the unfunded actuarial accrued liability of the fund must be determined in accordance
31.6with any new plan provisions governing annuities and benefits payable from the fund and
31.7any new actuarial assumptions and the remaining plan provisions governing annuities and
31.8benefits payable from the fund and actuarial assumptions in effect before the change;
31.9    (iv) the level annual dollar contribution or level percentage, whichever is applicable,
31.10needed to amortize the difference between the unfunded actuarial accrued liability amount
31.11calculated under item (i) and the unfunded actuarial accrued liability amount calculated
31.12under item (iii) over a period of 30 years from the end of the plan year in which the applicable
31.13change is effective must be calculated using the applicable interest assumption specified in
31.14subdivision 8 in effect after any applicable change;
31.15    (v) the level annual dollar or level percentage amortization contribution under item (iv)
31.16must be added to the level annual dollar amortization contribution or level percentage
31.17calculated under item (ii);
31.18    (vi) the period in which the unfunded actuarial accrued liability amount determined in
31.19item (iii) is amortized by the total level annual dollar or level percentage amortization
31.20contribution computed under item (v) must be calculated using the interest assumption
31.21specified in subdivision 8 in effect after any applicable change, rounded to the nearest
31.22integral number of years, but not to exceed 30 years from the end of the plan year in which
31.23the determination of the established date for full funding using the procedure set forth in
31.24this clause is made and not to be less than the period of years beginning in the plan year in
31.25which the determination of the established date for full funding using the procedure set forth
31.26in this clause is made and ending by the date for full funding in effect before the change;
31.27and
31.28    (vii) the period determined under item (vi) must be added to the date as of which the
31.29actuarial valuation was prepared and the date obtained is the new established date for full
31.30funding.
31.31    (d) For the general employees retirement plan of the Public Employees Retirement
31.32Association, the established date for full funding is June 30, 2031 2047.
31.33    (e) For the Teachers Retirement Association, the established date for full funding is June
31.3430, 2037 2047.
32.1    (f) For the correctional state employees retirement plan and the State Patrol retirement
32.2plan of the Minnesota State Retirement System, the established date for full funding is June
32.330, 2038 2047.
32.4    (g) For the judges retirement plan, the established date for full funding is June 30, 2038
32.52047.
32.6    (h) For the local government correctional service retirement plan and the public employees
32.7police and fire retirement plan, the established date for full funding is June 30, 2038 2047.
32.8    (i) For the St. Paul Teachers Retirement Fund Association, the established date for full
32.9funding is June 30, 2042. In addition to other requirements of this chapter, the annual
32.10actuarial valuation must contain an exhibit indicating the funded ratio and the deficiency
32.11or sufficiency in annual contributions when comparing liabilities to the market value of the
32.12assets of the fund as of the close of the most recent fiscal year 2047.
32.13(j) For the general state employees retirement plan of the Minnesota State Retirement
32.14System, the established date for full funding is June 30, 2040 2047.
32.15    (k) For the retirement plans for which the annual actuarial valuation indicates an excess
32.16of valuation assets over the actuarial accrued liability, the valuation assets in excess of the
32.17actuarial accrued liability must be recognized as a reduction in the current contribution
32.18requirements by an amount equal to the amortization of the excess expressed as a level
32.19percentage of pay over a 30-year period beginning anew with each annual actuarial valuation
32.20of the plan.
32.21EFFECTIVE DATE.This section is effective July 1, 2017.

32.22    Sec. 4. Minnesota Statutes 2016, section 356.30, subdivision 1, is amended to read:
32.23    Subdivision 1. Eligibility; computation of annuity. (a) Notwithstanding any provisions
32.24of the laws governing the covered retirement plans enumerated listed in subdivision 3, a
32.25person who has met the qualifications of paragraph (b) may elect to receive, upon retirement,
32.26a retirement annuity from each enumerated covered retirement plan in which the person has
32.27at least one-half year of allowable service, based on the allowable service in each plan,
32.28subject to the provisions of paragraph (c) (b), if the person has:
32.29(1) allowable service in any two or more of the covered plans;
32.30(2) at least one-half year of allowable service in each covered plan, based on the allowable
32.31service in each plan;
33.1(3) total allowable service equals or exceeds the longest service credit vesting requirement
33.2of the applicable retirement plan; and
33.3(4) not begun to receive an annuity from any covered plan or has made application for
33.4benefits from each applicable plan and the retirement annuity effective dates of each plan
33.5are within a one-year period.
33.6(b) A person may receive, upon retirement, a retirement annuity from each enumerated
33.7retirement plan in which the person has at least one-half year of allowable service, and
33.8augmentation of a deferred annuity calculated at the appropriate rate under the laws governing
33.9each public pension plan or fund named in subdivision 3, based on the date of the person's
33.10initial entry into public employment from the date the person terminated all public service
33.11if:
33.12(1) the person has allowable service in any two or more of the enumerated plans;
33.13(2) the person has sufficient allowable service in total that equals or exceeds the applicable
33.14service credit vesting requirement of the retirement plan with the longest applicable service
33.15credit vesting requirement; and
33.16(3) the person has not begun to receive an annuity from any enumerated plan or the
33.17person has made application for benefits from each applicable plan and the effective dates
33.18of the retirement annuity with each plan under which the person chooses to receive an
33.19annuity are within a one-year period.
33.20(c) (b) If all requirements in paragraph (a) have been satisfied, the retirement annuity
33.21from each plan must be based upon the allowable service, accrual rates, and average salary
33.22in the applicable plan except as further specified or modified in the following clauses:
33.23(1) the laws governing annuities must be the law in effect on the date of termination
33.24from the last period of public service under a covered retirement plan with which the person
33.25earned a minimum of one-half year of allowable service credit during that employment;
33.26(2) the "average salary" on which the annuity from each covered plan in which the
33.27employee has credit in a used to calculate the annuity for each formula plan must be based
33.28on the employee's highest five successive years of covered salary during the entire service
33.29in covered plans;
33.30(3) the accrual rates to be used by under each plan must be those the percentages
33.31prescribed by each plan's formula as continued in effect for the respective years of allowable
33.32service from one plan to the next, recognizing all previous allowable service with the other
33.33covered plans;
34.1(4) the allowable service in all the covered plans must be combined in determining
34.2eligibility for and the application of each plan's provisions in with respect to reduction in
34.3the annuity amount for retirement prior to normal retirement age; and
34.4(5) the annuity amount payable for any allowable service under a nonformula plan of
34.5that is a covered plan must not be affected, but such service and covered salary must be
34.6used in the above calculation.
34.7(c) If a person eligible for an annuity under paragraph (a) from each covered plan
34.8terminates all public service, the deferred annuity must be augmented from the date of
34.9termination until the earlier of:
34.10(1) the effective date of retirement; or
34.11(2) December 31, 2017, for the Minnesota State Retirement System and the Public
34.12Employees Retirement Association or June 30, 2018, for the Teachers Retirement Association
34.13and the St. Paul Teachers Retirement Association.
34.14A deferred annuity must not be augmented after the applicable dates under clause (2).
34.15The appropriate rate of augmentation is the rate in effect on the date on which the person
34.16entered into public employment and subsequently adjusted according to the laws governing
34.17each covered plan, as applicable.
34.18(d) This section does not apply to any person whose final termination from the last public
34.19service under a covered plan was before May 1, 1975.
34.20(e) For the purpose of computing annuities under this section, the accrual rates used by
34.21any covered plan, except the public employees police and fire plan, the judges retirement
34.22fund, and the State Patrol retirement plan, must not exceed 2.7 percent per year of service
34.23for any year of service or fraction thereof. The formula percentage used by:
34.24(1) the judges retirement fund accrual rate must not exceed 3.2 percent per year of service
34.25for any year of service or fraction thereof. The accrual rate used by;
34.26(2) the public employees police and fire plan and the State Patrol retirement plan accrual
34.27rate must not exceed 3.0 percent per year of service for any year of service or fraction
34.28thereof. The accrual rate or rates used by
34.29(3) the legislators retirement plan accrual rate must not exceed 2.5 percent, but this limit
34.30does not apply to the adjustment provided under section 3A.02, subdivision 1, paragraph
34.31(c); and
35.1(4) any other covered plan's accrual rate must not exceed 2.7 percent per year of service
35.2for any year of service or fraction thereof.
35.3(f) Any period of time for which a person has credit in more than one of the covered
35.4plans must be used only once for the purpose of determining total allowable service.
35.5(g) If the period of duplicated service credit is more than one-half year, or the person
35.6has credit for more than one-half year, with each of the plans, each plan must apply its
35.7formula to a prorated service credit for the period of duplicated service based on a fraction
35.8of the salary on which deductions were paid to that fund for the period divided by the total
35.9salary on which deductions were paid to all plans for the period.
35.10(h) If the period of duplicated service credit is less than one-half year, or when added
35.11to other service credit with that plan is less than one-half year, the service credit must be
35.12ignored and a refund of contributions made to the person in accord with that plan's refund
35.13provisions.
35.14EFFECTIVE DATE.This section is effective July 1, 2017.

35.15    Sec. 5. [356.311] COVERAGE BY MORE THAN ONE PLAN.
35.16(a) Any person who has been a member of two or more of the retirement plans listed in
35.17paragraph (b) is entitled, when qualified, to an annuity from each fund if:
35.18(i) the person's combined service in any two or more retirement plans equals or exceeds
35.19the vesting requirement of the fund with the longest vesting requirement, and
35.20(ii) the person has not taken a refund from any of the retirement plans.
35.21(b) This section applies to any defined benefit plan administered by the Minnesota State
35.22Retirement System, including the State Patrol Retirement Plan; the Public Employees
35.23Retirement Association, including the public employees police and fire plan, the Teachers
35.24Retirement Association, and the St. Paul Teachers Retirement Fund Association, except as
35.25noted in paragraph (c).
35.26(c) This section does not apply to plans providing benefits for police officers or
35.27firefighters under section 424A.091 to 424A.096 or the Bloomington Fire Department Relief
35.28Association.
35.29(d) No portion of the service upon which the retirement annuity from one retirement
35.30plan is based shall be again used in the computation of a retirement annuity from another
35.31plan. The annuity from each plan must be determined under the laws applicable to that plan
35.32except that the requirement that a person meet the vesting requirement in any particular
36.1plan shall not apply, provided the combined service in any two or more plans equals or
36.2exceeds the vesting requirement of the plan with the longest vesting requirement.
36.3(e) Any deferred annuity payable under this section shall be subject to augmentation
36.4under the laws applicable to the deferred annuity.
36.5(f) Any person to whom an annuity is not payable under this section because the person
36.6took a refund from one of the funds shall be entitled to repay the refund in accordance with
36.7the laws governing the refund. Upon repayment, the person is entitled to annuities under
36.8this section, if the person would otherwise be entitled.
36.9EFFECTIVE DATE.This section is effective July 1, 2017.

36.10    Sec. 6. Minnesota Statutes 2016, section 356.415, subdivision 1, is amended to read:
36.11    Subdivision 1. Annual postretirement adjustments; generally Minnesota State
36.12Retirement System general state employees retirement plan, legislators retirement
36.13plan, and unclassified state employees retirement program. (a) Except as otherwise
36.14provided in subdivision 1a, 1b, 1c, 1d, 1e, or 1f set forth in paragraph (c), recipients of a
36.15retirement annuity, disability benefit, or survivor benefit recipients of a covered from the
36.16general state employees retirement plan, the legislators retirement plan, or the unclassified
36.17state employees retirement program are entitled to a an annual postretirement adjustment
36.18annually on, effective as of each January 1, as follows:
36.19(1) effective January 1, 2018, through December 31, 2022, a postretirement increase of
36.202.5 one percent must be applied each year, effective January 1, to the monthly annuity or
36.21benefit of each annuitant or benefit recipient who has been receiving an annuity or a benefit
36.22for at least 12 full months as of the June 30 of the calendar year immediately before the
36.23adjustment; and
36.24(2) effective January 1, 2018, through December 31, 2022,for each annuitant or benefit
36.25recipient who has been receiving an annuity or a benefit amount for at least one full month,
36.26but less than 12 full months as of the June 30 of the calendar year immediately before the
36.27adjustment, an annual postretirement increase of 1/12 of 2.5 one percent for each month
36.28that the person has been receiving an annuity or benefit must be applied to the monthly
36.29annuity or benefit amount of the annuitant or benefit recipient;
36.30(3) effective January 1, 2023, and thereafter, a postretirement increase of 1.5 percent
36.31must be applied each year to the monthly annuity or benefit of each annuitant or benefit
36.32recipient who has been receiving an annuity or a benefit for at least 12 full months as of the
36.33June 30 of the calendar year immediately before the adjustment; and
37.1(4) effective January 1, 2023, and thereafter, for each annuitant or benefit recipient who
37.2has been receiving an annuity or a benefit amount for at least one full month, but less than
37.312 full months as of the June 30 of the calendar year immediately before the adjustment,
37.4an annual postretirement increase of 1/12 of 1.5 percent for each month that the person has
37.5been receiving an annuity or benefit must be applied to the monthly annuity or benefit
37.6amount of the annuitant or benefit recipient.
37.7(b) An increase in annuity or benefit payments under this section subdivision must be
37.8made automatically unless written notice is filed by the annuitant or benefit recipient with
37.9the executive director of the covered retirement plan requesting that the increase not be
37.10made.
37.11(c) Members who retire on or after January 1, 2018, under the general state employees
37.12retirement plan, the legislators retirement plan, or the unclassified state employees retirement
37.13program are entitled to an annual postretirement adjustment of the member's retirement
37.14annuity, effective as of each January 1, beginning with the year following the year in which
37.15the member attains normal retirement age, as follows:
37.16(1) if a member has been receiving an annuity for at least 12 full months as of the June
37.1730 of the calendar year immediately before the date of the adjustment, a postretirement
37.18increase of equal to the percentage specified in paragraph (a), clause (1) or (3), as applicable,
37.19must be applied, effective on January 1, to the member's monthly annuity;
37.20(2) if a member has been receiving an annuity for at least one full month, but less than
37.2112 full months as of the June 30 of the calendar year immediately before the date of
37.22adjustment, a postretirement increase of 1/12 of the percentage specified in clause (1) for
37.23each month that the member has been receiving an annuity must be applied, effective on
37.24January 1, to the member's monthly annuity; or
37.25(3) if a member has been receiving an annuity for fewer than six months before the date
37.26of adjustment, a postretirement increase shall not be applied until the next January 1 and
37.27the amount of the adjustment shall be the amount determined under clause (2).
37.28(d) Paragraph (c) does not apply to members who retire under section 352.116,
37.29subdivision 1, paragraph (c).
37.30EFFECTIVE DATE.This section is effective July 1, 2017.

37.31    Sec. 7. Minnesota Statutes 2016, section 356.415, subdivision 1a, is amended to read:
37.32    Subd. 1a. Annual postretirement adjustments; Minnesota State Retirement System
37.33plans other than State Patrol correctional state employees retirement plan. (a)
38.1Retirement annuity, disability benefit, or survivor benefit recipients of the legislators
38.2retirement plan, including constitutional officers as specified in chapter 3A, the general
38.3state employees retirement plan, the correctional state employees retirement plan, and the
38.4unclassified state employees retirement program are entitled to a an annual postretirement
38.5adjustment annually on, effective as of each January 1, as follows:
38.6(1) for each successive January 1, if the definition of funding stability under paragraph
38.7(b) has not been met as of the prior July 1 for or with respect to the applicable retirement
38.8plan, a postretirement increase of two 1.5 percent must be applied each year, effective on
38.9January 1, to the monthly annuity or benefit of each annuitant or benefit recipient who has
38.10been receiving an annuity or a benefit for at least 12 full months as of the June 30 of the
38.11calendar year immediately before the adjustment; and
38.12(2) for each successive January 1, if the definition of funding stability under paragraph
38.13(b) has not been met as of the prior July 1 for or with respect to the applicable retirement
38.14plan, for each annuitant or benefit recipient who has been receiving an annuity or a benefit
38.15for at least one full month, but less than 12 full months as of the June 30 of the calendar
38.16year immediately before the adjustment, an annual postretirement increase of 1/12 of two
38.171.5 percent for each month that the person has been receiving an annuity or benefit must
38.18be applied to the monthly annuity or benefit amount of each annuitant or benefit recipient.
38.19(b) Increases under this subdivision for the general state employees retirement plan or
38.20the correctional state employees retirement plan terminate on December 31 of the calendar
38.21year in which two prior consecutive actuarial valuations prepared by the approved actuary
38.22under sections 356.214 and 356.215 and the standards for actuarial work promulgated by
38.23the Legislative Commission on Pensions and Retirement indicate that the market value of
38.24assets of the retirement plan equals or exceeds 90 percent of the actuarial accrued liability
38.25of the retirement plan and increases under subdivision 1 recommence after that date. Increases
38.26under this subdivision for the legislators retirement plan established under chapter 3A,
38.27including the constitutional officers specified in that chapter, and for the unclassified state
38.28employees retirement program, terminate on December 31 of the calendar year in which
38.29two prior consecutive actuarial valuations prepared by the approved actuary under sections
38.30356.214 and 356.215 and the standards for actuarial work promulgated by the Legislative
38.31Commission on Pensions and Retirement indicate that the market value of assets of the
38.32general state employees retirement plan equals or exceeds 90 percent of the actuarial accrued
38.33liability of the retirement plan and increases under subdivision 1 recommence after that
38.34date.
39.1(c) After having met the definition of funding stability under paragraph (b), the increase
39.2provided in paragraph (a), clauses (1) and (2), rather than an increase under subdivision 1,
39.3for the general state employees retirement plan or the correctional state employees retirement
39.4plan, is again to be applied in a subsequent year or years if the market value of assets of the
39.5applicable plan equals or is less than:
39.6(1) 85 percent of the actuarial accrued liabilities of the applicable plan for two consecutive
39.7actuarial valuations; or
39.8(2) 80 percent of the actuarial accrued liabilities of the applicable plan for the most recent
39.9actuarial valuation.
39.10(d) After having met the definition of funding stability under paragraph (b), the increase
39.11provided in paragraph (a), clauses (1) and (2), rather than an increase under subdivision 1,
39.12for the legislators retirement plan, including the constitutional officers, and for the
39.13unclassified state employees retirement program, is again to be applied in a subsequent year
39.14or years if the market value of assets of the general state employees retirement plan equals
39.15or is less than:
39.16(1) 85 percent of the actuarial accrued liabilities of the applicable plan for two consecutive
39.17actuarial valuations; or
39.18(2) 80 percent of the actuarial accrued liabilities of the applicable plan for the most recent
39.19actuarial valuation.
39.20(e) (b) An increase in annuity or benefit payments under this subdivision must be made
39.21automatically unless written notice is filed by the annuitant or benefit recipient with the
39.22executive director of the applicable covered retirement plan requesting that the increase not
39.23be made.
39.24EFFECTIVE DATE.This section is effective July 1, 2017.

39.25    Sec. 8. Minnesota Statutes 2016, section 356.415, subdivision 1b, is amended to read:
39.26    Subd. 1b. Annual postretirement adjustments; PERA; general employees retirement
39.27plan and local government correctional retirement plan. (a) Except as set forth in
39.28paragraph (c), recipients of a retirement annuity, disability benefit, or survivor benefit
39.29recipients of the general employees retirement plan of the Public Employees Retirement
39.30Association and the local government correctional service retirement plan are entitled to a
39.31an annual postretirement adjustment annually on, effective as of each January 1, as follows:
40.1(1) for each successive January 1 until funding stability is restored for the applicable
40.2retirement plan, a postretirement increase of one percent must be applied each year, effective
40.3on January 1, to the monthly annuity or benefit amount of each annuitant or benefit recipient
40.4who has been receiving an annuity or benefit for at least 12 full months as of the June 30
40.5of the calendar year immediately before the adjustment;
40.6(2) for each successive January 1 until funding stability is restored for the applicable
40.7retirement plan, for each annuitant or benefit recipient who has been receiving an annuity
40.8or a benefit for at least one full month, but less than 12 full months as of the June 30 of the
40.9calendar year immediately before the adjustment, an annual postretirement increase of 1/12
40.10of one percent for each month the person has been receiving an annuity or benefit must be
40.11applied; to the monthly annuity or benefit amount of each annuitant or benefit recipient.
40.12(3) for each January 1 following the restoration of funding stability for the applicable
40.13retirement plan, a postretirement increase of 2.5 percent must be applied each year, effective
40.14January 1, to the monthly annuity or benefit amount of each annuitant or benefit recipient
40.15who has been receiving an annuity or benefit for at least 12 full months as of the June 30
40.16of the calendar year immediately before the adjustment; and
40.17(4) for each January 1 following restoration of funding stability for the applicable
40.18retirement plan, for each annuity or benefit recipient who has been receiving an annuity or
40.19a benefit for at least one full month, but less than 12 full months as of the June 30 of the
40.20calendar year immediately before the adjustment, an annual postretirement increase of 1/12
40.21of 2.5 percent for each month the person has been receiving an annuity or benefit must be
40.22applied.
40.23(b) Funding stability is restored when the market value of assets of the applicable
40.24retirement plan equals or exceeds 90 percent of the actuarial accrued liabilities of the
40.25applicable plan in the two most recent consecutive actuarial valuations prepared under
40.26section 356.215 and the standards for actuarial work by the approved actuary retained by
40.27the Public Employees Retirement Association under section 356.214.
40.28(c) After having met the definition of funding stability under paragraph (b), the increase
40.29provided in paragraph (a), clauses (1) and (2), rather than an increase under subdivision 1,
40.30is again to be applied in a subsequent year or years if the market value of assets of the
40.31applicable plan equals or is less than:
40.32(1) 85 percent of the actuarial accrued liabilities of the applicable plan for two consecutive
40.33actuarial valuations; or
41.1(2) 80 percent of the actuarial accrued liabilities of the applicable plan for the most recent
41.2actuarial valuation.
41.3(d) (b) An increase in annuity or benefit payments under this section must be made
41.4automatically unless written notice is filed by the annuitant or benefit recipient with the
41.5executive director of the Public Employees Retirement Association requesting that the
41.6increase not be made.
41.7(c) Members who retire on or after January 1, 2018, are entitled to an annual
41.8postretirement adjustment of the member's retirement annuity, effective as of each January
41.91, beginning with the year following the year in which the member attains normal retirement
41.10age, as follows:
41.11(1) if a member has been receiving an annuity for at least 12 full months as of the June
41.1230 of the calendar year immediately before the date of the adjustment, a postretirement
41.13increase of equal to the percentage specified in paragraph (a), clause (1), must be applied,
41.14effective on January 1, to the member's monthly annuity;
41.15(2) if a member has been receiving an annuity for at least one full month, but less than
41.1612 full months as of the June 30 of the calendar year immediately before the date of
41.17adjustment, a postretirement increase of 1/12 of the percentage specified in clause (1) for
41.18each month that the member has been receiving an annuity must be applied, effective on
41.19January 1 to the member's monthly annuity; or
41.20(3) if a member has been receiving an annuity for fewer than six months before the date
41.21of adjustment, a postretirement increase shall not be applied until the next January 1 and
41.22the amount of the adjustment shall be the amount determined under clause (2).
41.23(d) Paragraph (c) does not apply to members who retire under section 353.30, subdivision
41.241a.
41.25EFFECTIVE DATE.This section is effective July 1, 2017.

41.26    Sec. 9. Minnesota Statutes 2016, section 356.415, subdivision 1c, is amended to read:
41.27    Subd. 1c. Annual postretirement adjustments; PERA-police and fire. (a) Retirement
41.28annuity, disability benefit, or survivor benefit recipients of the public employees police and
41.29fire retirement plan are entitled to a an annual postretirement adjustment annually on ,
41.30effective as of each January 1, if the definition of funding stability under paragraph (c) has
41.31not been met, as follows:
42.1(1) for each annuitant or benefit recipient whose annuity or benefit effective date is on
42.2or before June 1, 2014, who has been receiving the annuity or benefit for at least 12 full
42.3months as of the immediate preceding June 30, an amount equal to one percent in each year;
42.4or
42.5(2) for each annuitant or benefit recipient whose annuity or benefit effective date is on
42.6or before June 1, 2014, who has been receiving the annuity or benefit for at least one full
42.7month, but less than 12 months, as of the immediate preceding June 30, an amount equal
42.8to 1/12 of one percent for each month of annuity or benefit receipt; and
42.9(3) (1) for each annuitant or benefit recipient whose annuity or benefit effective date is
42.10after June 1, 2014, who will have been receiving an annuity or benefit for at least 36 full
42.11months as of the immediate preceding June 30, an amount equal to a postretirement increase
42.12of one percent must be applied each year to the monthly annuity or benefit amount of the
42.13annuity or benefit recipient; or
42.14(4) (2) for each annuitant or benefit recipient whose annuity or benefit effective date is
42.15after June 1, 2014, who has been receiving the annuity or benefit for at least 25 full months,
42.16but less than 36 months as of the immediate preceding June 30, an amount equal to a
42.17postretirement increase of 1/12 of one percent for each full month of that the person has
42.18been receiving an annuity or benefit receipt during the fiscal year in which the annuity or
42.19benefit was effective must be applied each year to the monthly annuity or benefit amount
42.20of the annuity or benefit recipient.
42.21(b) Retirement annuity, disability benefit, or survivor benefit recipients of the public
42.22employees police and fire retirement plan are entitled to a postretirement adjustment annually
42.23on each January 1 following the restoration of funding stability as defined under paragraph
42.24(c) and during the continuation of funding stability as defined under paragraph (c), as follows:
42.25(1) for each annuitant or benefit recipient who has been receiving the annuity or benefit
42.26for at least 36 full months as of the immediate preceding June 30, an amount equal to 2.5
42.27percent; and
42.28(2) for each annuitant or benefit recipient who has been receiving the annuity or benefit
42.29for at least 25 full months, but less than 36 full months, as of the immediate preceding June
42.3030, an amount equal to 1/12 of 2.5 percent for each full month of annuity or benefit receipt
42.31during the fiscal year in which the annuity or benefit was effective.
42.32(c) Funding stability is restored when the market value of assets of the public employees
42.33police and fire retirement plan equals or exceeds 90 percent of the actuarial accrued liabilities
42.34of the applicable plan in the two most recent consecutive actuarial valuations prepared under
43.1section 356.215 and under the standards for actuarial work of the Legislative Commission
43.2on Pensions and Retirement by the approved actuary retained by the Public Employees
43.3Retirement Association under section 356.214.
43.4(d) After having met the definition of funding stability under paragraph (c), a full or
43.5prorated increase, as provided in paragraph (a), clause (1), (2), (3), or (4), whichever applies,
43.6rather than adjustments under paragraph (b), is again applied in a subsequent year or years
43.7if the market value of assets of the public employees police and fire retirement plan equals
43.8or is less than:
43.9(1) 85 percent of the actuarial accrued liabilities of the applicable plan for two consecutive
43.10actuarial valuations; or
43.11(2) 80 percent of the actuarial accrued liabilities of the applicable plan for the most recent
43.12actuarial valuation.
43.13(e) (b) An increase in annuity or benefit payments under this section must be made
43.14automatically unless written notice is filed by the annuitant or benefit recipient with the
43.15executive director of the Public Employees Retirement Association requesting that the
43.16increase not be made.
43.17EFFECTIVE DATE.This section is effective July 1, 2017.

43.18    Sec. 10. Minnesota Statutes 2016, section 356.415, subdivision 1d, is amended to read:
43.19    Subd. 1d. Teachers Retirement Association annual postretirement adjustments. (a)
43.20Except as set forth in paragraph (d), recipients of a retirement annuity, disability benefit,
43.21or survivor benefit recipients of the Teachers Retirement Association are entitled to a an
43.22annual postretirement adjustment annually on , effective as of each January 1, as follows:
43.23(1) for each January 1 until funding stability is restored, a postretirement increase of
43.24two one percent must be applied each year, effective on January 1, to the monthly annuity
43.25or benefit amount of each annuitant or benefit recipient who has been receiving an annuity
43.26or a benefit for at least 12 full months as of the June 30 of the calendar year immediately
43.27before the adjustment;
43.28(2) for each January 1 until funding stability is restored, for each annuitant or benefit
43.29recipient who has been receiving an annuity or a benefit for at least one full month, but less
43.30than 12 full months as of the June 30 of the calendar year immediately before the adjustment,
43.31an annual postretirement increase of 1/12 of two one percent for each month the person has
43.32been receiving an annuity or benefit must be applied;
44.1(3) for each January 1 following the restoration of funding stability, a postretirement
44.2increase of 2.5 percent must be applied each year, effective January 1, to the monthly annuity
44.3or benefit amount of each annuitant or benefit recipient who has been receiving an annuity
44.4or a benefit for at least 12 full months as of the June 30 of the calendar year immediately
44.5before the adjustment; and
44.6(4) for each January 1 following the restoration of funding stability, for each annuitant
44.7or benefit recipient who has been receiving an annuity or a benefit for at least one month,
44.8but less than 12 full months as of the June 30 of the calendar year immediately before the
44.9adjustment, an annual postretirement increase of 1/12 of 2.5 percent for each month the
44.10person has been receiving an annuity or benefit must be applied.
44.11(b) Funding stability is restored when the market value of assets of the Teachers
44.12Retirement Association equals or exceeds 90 percent of the actuarial accrued liabilities of
44.13the Teachers Retirement Association in the two most recent prior actuarial valuations
44.14prepared under section 356.215 and the standards for actuarial work by the approved actuary
44.15retained by the Teachers Retirement Association under section 356.214.
44.16(c) After having met the definition of funding stability under paragraph (b), the increase
44.17provided in paragraph (a), clauses (1) and (2), rather than an increase under subdivision 1,
44.18or the increase under paragraph (a), clauses (3) and (4), is again to be applied in a subsequent
44.19year or years if the market value of assets of the plan equals or is less than:
44.20(1) 85 percent of the actuarial accrued liabilities of the plan for two consecutive actuarial
44.21valuations; or
44.22(2) 80 percent of the actuarial accrued liabilities of the plan for the most recent actuarial
44.23valuation.
44.24(d) (b) An increase in annuity or benefit payments under this section must be made
44.25automatically unless written notice is filed by the annuitant or benefit recipient with the
44.26executive director of the Teachers Retirement Association requesting that the increase not
44.27be made.
44.28(e) (c) The retirement annuity payable to a person who retires before becoming eligible
44.29for Social Security benefits and who has elected the optional payment as provided in section
44.30354.35 must be treated as the sum of a period-certain retirement annuity and a life retirement
44.31annuity for the purposes of any postretirement adjustment. The period-certain retirement
44.32annuity plus the life retirement annuity must be the annuity amount payable until age 62,
44.3365, or normal retirement age, as selected by the member at retirement, for an annuity amount
45.1payable under section 354.35. A postretirement adjustment granted on the period-certain
45.2retirement annuity must terminate when the period-certain retirement annuity terminates.
45.3(d) Members who retire on or after January 1, 2018, are entitled to an annual
45.4postretirement adjustment of the member's retirement annuity, effective as of each January
45.51, beginning with the year following the year in which the member attains normal retirement
45.6age, as follows:
45.7(1) if a member has been receiving an annuity for at least 12 full months as of the June
45.830 of the calendar year immediately before the date of the adjustment, a postretirement
45.9increase of equal to the percentage specified in paragraph (a), clause (1), must be applied,
45.10effective on January 1 to the member's monthly annuity;
45.11(2) if a member has been receiving an annuity for at least one full month, but less than
45.1212 full months as of the June 30 of the calendar year immediately before the date of
45.13adjustment, a postretirement increase of 1/12 of the percentage specified in clause (1) for
45.14each month that the member has been receiving an annuity must be applied, effective on
45.15January 1, to the member's monthly annuity; or
45.16(3) if a member has been receiving an annuity for fewer than six months before the date
45.17of adjustment, a postretirement increase shall not be applied until the next January 1 and
45.18the amount of the adjustment shall be the amount determined under clause (2).
45.19(e) Paragraph (d) does not apply to members who retire under section 354.44, subdivision
45.206, paragraph (c), item (iii).
45.21EFFECTIVE DATE.This section is effective July 1, 2017.

45.22    Sec. 11. Minnesota Statutes 2016, section 356.415, subdivision 1e, is amended to read:
45.23    Subd. 1e. Annual postretirement adjustments; State Patrol retirement plan. (a)
45.24Retirement annuity, disability benefit, or survivor benefit recipients of the State Patrol
45.25retirement plan are entitled to a an annual postretirement adjustment annually on, effective
45.26as of each January 1 if the definition of funding stability under paragraph (b) has not been
45.27met, as follows:
45.28(1) a postretirement increase of one percent must be applied each year, effective on
45.29January 1, to the monthly annuity or benefit of each annuitant or benefit recipient who has
45.30been receiving an annuity or a benefit for at least 12 full months as of the June 30 of the
45.31calendar year immediately before the adjustment; and
46.1(2) for each annuitant or benefit recipient who has been receiving an annuity or a benefit
46.2for at least one full month, but less than 12 full months as of the June 30 of the calendar
46.3year immediately before the adjustment, an annual postretirement increase of 1/12 of one
46.4percent for each month that the person has been receiving an annuity or benefit must be
46.5applied to the monthly annuity or benefit of each annuitant or benefit recipient.
46.6(b) Increases under paragraph (a) for the State Patrol retirement plan terminate on
46.7December 31 of the calendar year in which two prior consecutive actuarial valuations for
46.8the plan prepared by the approved actuary under sections 356.214 and 356.215 and the
46.9standards for actuarial work promulgated by the Legislative Commission on Pensions and
46.10Retirement indicates that the market value of assets of the retirement plan equals or exceeds
46.1185 percent of the actuarial accrued liability of the retirement plan. Thereafter, increases
46.12under paragraph (a) become effective again on the December 31 of the calendar year in
46.13which the actuarial valuation, or prior consecutive actuarial valuations for the plan prepared
46.14by the approved actuary under sections 356.214 and 356.215 and the standards for actuarial
46.15work promulgated by the Legislative Commission on Pensions and Retirement indicates
46.16that the market value of the assets of the retirement plan equals or is less than 80 percent
46.17of the actuarial accrued liability of the retirement plan for two years, or equals or is less
46.18than 75 percent of the actuarial accrued liability of the retirement plan for one year and
46.19increases under paragraph (c) commence after that date.
46.20(c) Retirement annuity, disability benefit, or survivor benefit recipients of the State Patrol
46.21retirement plan are entitled to a postretirement adjustment annually on January 1, as follows:
46.22(1) a postretirement increase of 1.5 percent must be applied each year, effective on
46.23January 1, to the monthly annuity or benefit of each annuitant or benefit recipient who has
46.24been receiving an annuity or a benefit for at least 12 full months as of the June 30 of the
46.25calendar year immediately before the adjustment; and
46.26(2) for each annuitant or benefit recipient who has been receiving an annuity or a benefit
46.27for at least one full month, but less than 12 full months as of the June 30 of the calendar
46.28year immediately before the adjustment, an annual postretirement increase of 1/12 of 1.5
46.29percent for each month that the person has been receiving an annuity or benefit must be
46.30applied.
46.31(d) Increases under paragraph (c) for the State Patrol retirement plan terminate on
46.32December 31 of the calendar year in which two prior consecutive actuarial valuations
46.33prepared by the approved actuary under sections 356.214 and 356.215 and the standards
46.34for actuarial work adopted by the Legislative Commission on Pensions and Retirement
47.1indicates that the market value of assets of the retirement plan equals or exceeds 90 percent
47.2of the actuarial accrued liability of the retirement plan and increases under subdivision 1
47.3recommence after that date.
47.4(e) (b) An increase in annuity or benefit payments under this subdivision must be made
47.5automatically unless written notice is filed by the annuitant or benefit recipient with the
47.6executive director of the applicable covered retirement plan requesting that the increase not
47.7be made.
47.8EFFECTIVE DATE.This section is effective July 1, 2017.

47.9    Sec. 12. Minnesota Statutes 2016, section 356.415, subdivision 1f, is amended to read:
47.10    Subd. 1f. Annual postretirement adjustments; Minnesota State Retirement System
47.11judges retirement plan. (a) The increases provided under this subdivision are in lieu of
47.12increases under subdivision 1 or 1a for retirement annuity, disability benefit, or survivor
47.13benefit recipients of the judges retirement plan.
47.14(b) (a) Retirement annuity, disability benefit, or survivor benefit recipients of the judges
47.15retirement plan are entitled to a an annual postretirement adjustment annually on , effective
47.16as of each January 1, if the definition of funding stability under paragraph (b) has not been
47.17met, as follows:
47.18(1) a postretirement increase of 1.75 percent must be applied each year, effective on
47.19January 1, to the monthly annuity or benefit of each annuitant or benefit recipient who has
47.20been receiving an annuity or a benefit for at least 12 full months as of the June 30 of the
47.21calendar year immediately before the adjustment; and
47.22(2) for each annuitant or benefit recipient who has been receiving an annuity or a benefit
47.23for at least one full month, but less than 12 full months as of the June 30 of the calendar
47.24year immediately before the adjustment, an annual postretirement increase of 1/12 of 1.75
47.25percent for each month that the person has been receiving an annuity or benefit must be
47.26applied to the monthly annuity or benefit of each annuitant or benefit recipient.
47.27(c) (b) Increases under this subdivision paragraph (a) terminate on December 31 of the
47.28calendar year in which two prior consecutive actuarial valuations prepared by the approved
47.29actuary under sections 356.214 and 356.215 and the standards for actuarial work promulgated
47.30by the Legislative Commission on Pensions and Retirement indicates that the market value
47.31of assets of the judges retirement plan equals or exceeds 70 percent of the actuarial accrued
47.32liability of the retirement plan. and increases under subdivision 1 or 1a, whichever is
47.33applicable, paragraph (c) begin on the January 1 next following after that date.
48.1(c) Retirement annuity, disability benefit, or survivor benefit recipients of the judges
48.2retirement plan are entitled to a postretirement adjustment annually, effective as of each
48.3January 1 if the definition of funding stability under paragraph (d) has not been met, as
48.4follows:
48.5(1) a postretirement increase of two percent must be applied each year to the monthly
48.6annuity or benefit of each annuitant or benefit recipient who has been receiving an annuity
48.7or a benefit for at least 12 full months as of the June 30 of the calendar year immediately
48.8before the adjustment; and
48.9(2) for each annuitant or benefit recipient who has been receiving an annuity or a benefit
48.10for at least one full month, but less than 12 full months as of the June 30 of the calendar
48.11year immediately before the adjustment, an annual postretirement increase of 1/12 of two
48.12percent for each month that the person has been receiving an annuity or benefit must be
48.13applied to the monthly annuity or benefit amount of the annuitant or benefit recipient.
48.14(d) Increases under paragraph (c) terminate on December 31 of the calendar year in
48.15which two prior consecutive actuarial valuations prepared by the approved actuary under
48.16section 356.214 and the standards for actuarial work promulgated by the Legislative
48.17Commission on Pensions and Retirement indicate that the market value of assets of the
48.18judges retirement plan equals or exceeds 90 percent of the actuarial accrued liability of the
48.19retirement plan and increases under paragraph (e) begin after that date.
48.20(e) Retirement annuity, disability benefit, or survivor benefit recipients of the judges
48.21retirement plan are entitled to a postretirement adjustment annually, effective as of each
48.22January 1, as follows:
48.23(1) a postretirement increase of 2.5 percent must be applied each year to the monthly
48.24annuity or benefit of each annuitant or benefit recipient who has been receiving an annuity
48.25or a benefit for at least 12 full months as of the June 30 of the calendar year immediately
48.26before the adjustment; and
48.27(2) for each annuitant or benefit recipient who has been receiving an annuity or a benefit
48.28for at least one full month, but less than 12 full months as of the June 30 of the calendar
48.29year immediately before the adjustment, an annual postretirement increase of 1/12 of 2.5
48.30percent for each month that the person has been receiving an annuity or benefit must be
48.31applied to the monthly annuity or benefit amount of the annuitant or benefit recipient.
48.32(d) (f) An increase in annuity or benefit payments under this subdivision must be made
48.33automatically unless written notice is filed by the annuitant or benefit recipient with the
49.1executive director of the applicable covered retirement plan requesting that the increase not
49.2be made.
49.3EFFECTIVE DATE.This section is effective July 1, 2017.

49.4    Sec. 13. Minnesota Statutes 2016, section 356.415, is amended by adding a subdivision
49.5to read:
49.6    Subd. 1g. Annual postretirement adjustments; PERA local government correctional
49.7retirement plan. (a) Retirement annuity, disability benefit, or survivor benefit recipients
49.8of the public employees local government correctional service retirement plan are entitled
49.9to an annual postretirement adjustment, effective as of each January 1 as follows:
49.10(1) a postretirement increase of 1.5 percent must be applied each year to the monthly
49.11annuity or benefit of each annuitant or benefit recipient who has been receiving an annuity
49.12or a benefit for at least 12 full months as of the June 30 of the calendar year immediately
49.13before the adjustment; and
49.14(2) for each annuitant or benefit recipient who has been receiving an annuity or a benefit
49.15for at least one full month, but less than 12 full months as of the June 30 of the calendar
49.16year immediately before the adjustment, a postretirement increase of 1/12 of 1.5 percent
49.17for each month that the person has been receiving an annuity or benefit must be applied to
49.18the monthly annuity or benefit amount of the annuitant or benefit recipient.
49.19(b) An increase in annuity or benefit payments under this subdivision must be made
49.20automatically unless written notice is filed by the annuitant or benefit recipient with the
49.21executive director of the applicable covered retirement plan requesting that the increase not
49.22be made.
49.23EFFECTIVE DATE.This section is effective July 1, 2017.

49.24    Sec. 14. STUDY.
49.25Before December 31, 2020, the Legislative Commission on Pensions and Retirement
49.26must conduct a study of the rates of the postretirement adjustments for the covered plans
49.27as defined in section 356.415, subdivision 2, and the St. Paul Teachers Retirement Fund
49.28Association, and make recommendations regarding whether they should be modified and
49.29whether a new methodology for determining postretirement adjustment should be adopted.
49.30The Legislative Commission on Pensions and Retirement shall make a determination based
49.31on the study during the 2021 legislative session.
49.32EFFECTIVE DATE.This section is effective the day following final enactment.


50.3    Section 1. Minnesota Statutes 2016, section 3A.03, subdivision 2, is amended to read:
50.4    Subd. 2. Refund. (a) A former member who has made contributions under subdivision
50.51 and who is no longer a member of the legislature is entitled to receive, upon written
50.6application to the executive director on a form prescribed by the executive director, a refund
50.7from the general fund of all contributions credited to the member's account with interest
50.8computed as provided in section 352.22, subdivision 2.
50.9    (b) The refund of contributions as provided in paragraph (a) terminates all rights of a
50.10former member of the legislature and the survivors of the former member under this chapter.
50.11    (c) If the former member of the legislature again becomes a member of the legislature
50.12after having taken a refund as provided in paragraph (a), the member is a member of the
50.13unclassified employees retirement program of the Minnesota State Retirement System.
50.14    (d) However, the member may reinstate the rights and credit for service previously
50.15forfeited under this chapter if the member repays all refunds taken, plus interest at the rate
50.16of 8.5 percent until June 30, 2015, and eight percent thereafter applicable annual rate or
50.17rates specified in section 356.59, subdivision 2, compounded annually, from the date on
50.18which the refund was taken to the date on which the refund is repaid.
50.19(e) A member of the legislature who has received a refund from any of the retirement
50.20plans specified in section 356.311, paragraph (b), may repay the refund to the respective
50.21plan under such terms and conditions consistent with the law governing the retirement plan
50.22if the law governing the plan permits the repayment of refunds. If the total amount to be
50.23repaid, including principal and interest exceeds $2,000, repayment may be made in three
50.24equal installments over a period of 18 months, with the interest accrued during the period
50.25of the repayment added to the final installment.
50.26    (e) (f) No person may be required to apply for or to accept a refund.
50.27EFFECTIVE DATE.This section is effective July 1, 2017.

50.28    Sec. 2. Minnesota Statutes 2016, section 352.01, subdivision 13a, is amended to read:
50.29    Subd. 13a. Reduced salary during period of workers' compensation. An employee
50.30on leave of absence receiving temporary workers' compensation payments and a reduced
50.31salary or no salary from the employer who is entitled to allowable service credit for the
50.32period of absence, may make payment to the fund for the difference between salary received,
51.1if any, and the salary the employee would normally receive if not on leave of absence during
51.2the period. The employee shall pay an amount equal to the employee and employer
51.3contribution rate under section 352.04, subdivisions 2 and 3, on the differential salary amount
51.4for the period of the leave of absence.
51.5The employing department, at its option, may pay the employer amount on behalf of its
51.6employees. Payment made under this subdivision must include interest at the rate of 8.5
51.7percent until June 30, 2015, and eight percent thereafter per year applicable annual rate or
51.8rates specified in section 356.59, subdivision 2, and must be completed within one year of
51.9the return from leave of absence.
51.10EFFECTIVE DATE.This section is effective July 1, 2017.

51.11    Sec. 3. Minnesota Statutes 2016, section 352.017, subdivision 2, is amended to read:
51.12    Subd. 2. Purchase procedure. (a) An employee covered by a plan specified in this
51.13chapter may purchase credit for allowable service in that plan for a period specified in
51.14subdivision 1 if the employee makes a payment as specified in paragraph (b) or (c), whichever
51.15applies. The employing unit, at its option, may pay the employer portion of the amount
51.16specified in paragraph (b) on behalf of its employees.
51.17    (b) If payment is received by the executive director within one year from the date the
51.18employee returned to work following the authorized leave, the payment amount is equal to
51.19the employee and employer contribution rates specified in law for the applicable plan at the
51.20end of the leave period multiplied by the employee's hourly rate of salary on the date of
51.21return from the leave of absence and by the days and months of the leave of absence for
51.22which the employee is eligible for allowable service credit. The payment must include
51.23compound interest at the monthly rate of 0.71 percent until June 30, 2015, and 0.667 percent
51.24per month thereafter applicable monthly rate or rates specified in section 356.59, subdivision
51.252, from the last day of the leave period until the last day of the month in which payment is
51.26received. If payment is received by the executive director after one year, the payment amount
51.27is the amount determined under section 356.551. Payment under this paragraph must be
51.28made before the date of termination from public employment covered under this chapter.
51.29    (c) If the employee terminates employment covered by this chapter during the leave or
51.30following the leave rather than returning to covered employment, payment must be received
51.31by the executive director within 30 days after the termination date. The payment amount is
51.32equal to the employee and employer contribution rates specified in law for the applicable
51.33plan on the day prior to the termination date, multiplied by the employee's hourly rate of
51.34salary on that date and by the days and months of the leave of absence prior to termination.
52.1EFFECTIVE DATE.This section is effective July 1, 2017.

52.2    Sec. 4. Minnesota Statutes 2016, section 352.04, subdivision 8, is amended to read:
52.3    Subd. 8. Department required to pay omitted salary deductions. (a) If a department
52.4fails to take deductions past due for a period of 60 days or less from an employee's salary
52.5as provided in this section, those deductions must be taken on later payroll abstracts.
52.6(b) If a department fails to take deductions past due for a period in excess of 60 days
52.7from an employee's salary as provided in this section, the department, and not the employee,
52.8must pay on later payroll abstracts the employee and employer contributions and an amount
52.9equivalent to 8.5 percent until June 30, 2015, and eight percent thereafter of the total amount
52.10due in lieu of interest, or if the delay in payment exceeds one year, 8.5 percent until June
52.1130, 2015, and eight percent thereafter compound annual interest at the applicable annual
52.12rate or rates specified in section 356.59, subdivision 2, compounded annually, from the date
52.13the employee and employer contributions should have been deducted to the date payment
52.14of the total amount due is paid by the department.
52.15(c) If a department fails to take deductions past due for a period of 60 days or less and
52.16the employee is no longer in state service so that the required deductions cannot be taken
52.17from the salary of the employee, the department must nevertheless pay the required employer
52.18contributions. If any department fails to take deductions past due for a period in excess of
52.1960 days and the employee is no longer in state service, the omitted contributions must be
52.20recovered under paragraph (b).
52.21(d) If an employee from whose salary required deductions were past due for a period of
52.2260 days or less leaves state service before the payment of the omitted deductions and
52.23subsequently returns to state service, the unpaid amount is considered the equivalent of a
52.24refund. The employee accrues no right by reason of the unpaid amount, except that the
52.25employee may pay the amount of omitted deductions as provided in section 352.23.
52.26EFFECTIVE DATE.This section is effective July 1, 2017.

52.27    Sec. 5. Minnesota Statutes 2016, section 352.04, subdivision 9, is amended to read:
52.28    Subd. 9. Erroneous deductions, canceled warrants. (a) Deductions taken from the
52.29salary of an employee for the retirement fund in excess of required amounts must, upon
52.30discovery and verification by the department making the deduction, be refunded to the
52.31employee.
53.1(b) If a deduction for the retirement fund is taken from a salary warrant or check, and
53.2the check is canceled or the amount of the warrant or check returned to the funds of the
53.3department making the payment, the sum deducted, or the part of it required to adjust the
53.4deductions, must be refunded to the department or institution if the department applies for
53.5the refund on a form furnished by the director. The department's payments must likewise
53.6be refunded to the department.
53.7(c) If erroneous employee deductions and employer contributions are caused by an error
53.8in plan coverage involving the plan and any other plans specified in section 356.99, that
53.9section applies. If the employee should have been covered by the plan governed by chapter
53.10352D, 353D, 354B, or 354D, the employee deductions and employer contributions taken
53.11in error must be directly transferred to the applicable employee's account in the correct
53.12retirement plan, with interest at the rate of 0.71 percent per month until June 30, 2015, and
53.130.667 percent per month thereafter applicable monthly rate or rates specified in section
53.14356.59, subdivision 2, compounded annually, from the first day of the month following the
53.15month in which coverage should have commenced in the correct defined contribution plan
53.16until the end of the month in which the transfer occurs.
53.17EFFECTIVE DATE.This section is effective July 1, 2017.

53.18    Sec. 6. Minnesota Statutes 2016, section 352.23, is amended to read:
53.19352.23 TERMINATION OF RIGHTS; REPAYMENT OF REFUND.
53.20(a) When any employee accepts a refund as provided in section 352.22, all existing
53.21allowable service credits and all rights and benefits to which the employee was entitled
53.22before accepting the refund terminate.
53.23(b) Terminated service credits and rights must not again be restored until the former
53.24employee acquires at least six months of allowable service credit after taking the last refund.
53.25In that event, the employee may repay all refunds previously taken from the retirement fund.
53.26(c) Repayment of refunds entitles the employee only to credit for service covered by (1)
53.27salary deductions; (2) payments previously made in lieu of salary deductions as permitted
53.28under law in effect when the payment in lieu of deductions was made; (3) payments made
53.29to obtain credit for service as permitted by laws in effect when payment was made; and (4)
53.30allowable service previously credited while receiving temporary workers' compensation as
53.31provided in section 352.01, subdivision 11, paragraph (a), clause (3).
53.32(d) Payments under this section for repayment of refunds are to be paid with interest at
53.33the rate of 8.5 percent until June 30, 2015, and eight percent thereafter applicable annual
54.1rate or rates specified in section 356.59, subdivision 2, compounded annually, from the date
54.2the refund was taken until the date the refund is repaid. They may be paid in a lump sum
54.3or by payroll deduction in the manner provided in section 352.04. Payment may be made
54.4in a lump sum up to six months after termination from service.
54.5EFFECTIVE DATE.This section is effective July 1, 2017.

54.6    Sec. 7. Minnesota Statutes 2016, section 352.27, is amended to read:
54.7352.27 CREDIT FOR BREAK IN SERVICE TO PROVIDE UNIFORMED
54.8SERVICE.
54.9    (a) An employee who is absent from employment by reason of service in the uniformed
54.10services, as defined in United States Code, title 38, section 4303(13), and who returns to
54.11state service upon discharge from service in the uniformed service within the time frames
54.12required in United States Code, title 38, section 4312(e), may obtain service credit for the
54.13period of the uniformed service as further specified in this section, provided that the employee
54.14did not separate from uniformed service with a dishonorable or bad conduct discharge or
54.15under other than honorable conditions.
54.16    (b) The employee may obtain credit by paying into the fund an equivalent employee
54.17contribution based upon the contribution rate or rates in effect at the time that the uniformed
54.18service was performed multiplied by the full and fractional years being purchased and
54.19applied to the annual salary rate. The annual salary rate is the average annual salary during
54.20the purchase period that the employee would have received if the employee had continued
54.21to be employed in covered employment rather than to provide uniformed service, or, if the
54.22determination of that rate is not reasonably certain, the annual salary rate is the employee's
54.23average salary rate during the 12-month period of covered employment rendered immediately
54.24preceding the period of the uniformed service.
54.25    (c) The equivalent employer contribution and, if applicable, the equivalent additional
54.26employer contribution provided in this chapter must be paid by the department employing
54.27the employee from funds available to the department at the time and in the manner provided
54.28in this chapter, using the employer and additional employer contribution rate or rates in
54.29effect at the time that the uniformed service was performed, applied to the same annual
54.30salary rate or rates used to compute the equivalent employee contribution.
54.31    (d) If the employee equivalent contributions provided in this section are not paid in full,
54.32the employee's allowable service credit must be prorated by multiplying the full and fractional
54.33number of years of uniformed service eligible for purchase by the ratio obtained by dividing
55.1the total employee contribution received by the total employee contribution otherwise
55.2required under this section.
55.3    (e) To receive service credit under this section, the contributions specified in this section
55.4must be transmitted to the Minnesota State Retirement System during the period which
55.5begins with the date on which the individual returns to state service and which has a duration
55.6of three times the length of the uniformed service period, but not to exceed five years. If
55.7the determined payment period is less than one year, the contributions required under this
55.8section to receive service credit may be made within one year of the discharge date.
55.9    (f) The amount of service credit obtainable under this section may not exceed five years
55.10unless a longer purchase period is required under United States Code, title 38, section 4312.
55.11    (g) The employing unit shall pay interest on all equivalent employee and employer
55.12contribution amounts payable under this section. Interest must be computed at the rate of
55.138.5 percent until June 30, 2015, and eight percent thereafter at the applicable annual rate or
55.14rates specified in section 356.59, subdivision 2, compounded annually, from the end of each
55.15fiscal year of the leave or the break in service to the end of the month in which the payment
55.16is received.
55.17EFFECTIVE DATE.This section is effective July 1, 2017.

55.18    Sec. 8. Minnesota Statutes 2016, section 352.955, subdivision 3, is amended to read:
55.19    Subd. 3. Payment of additional equivalent contributions. (a) An eligible employee
55.20who is transferred to plan coverage and who elects to transfer past service credit under this
55.21section must pay an additional member contribution for that prior service period. The
55.22additional member contribution is the amount computed under paragraph (b), plus the greater
55.23of the amount computed under paragraph (c), or 40 percent of the unfunded actuarial accrued
55.24liability attributable to the past service credit transfer.
55.25    (b) The executive director shall compute, for the most recent 12 months of service credit
55.26eligible for transfer, or for the entire period eligible for transfer if less than 12 months, the
55.27difference between the employee contribution rate or rates for the general state employees
55.28retirement plan and the employee contribution rate or rates for the correctional state
55.29employees retirement plan applied to the eligible employee's salary during that transfer
55.30period, plus compound interest at the applicable monthly rate of 0.71 percent until June 30,
55.312015, and 0.667 percent per month thereafter or rates specified in section 356.59, subdivision
55.322.
56.1    (c) The executive director shall compute, for any service credit being transferred on
56.2behalf of the eligible employee and not included under paragraph (b), the difference between
56.3the employee contribution rate or rates for the general state employees retirement plan and
56.4the employee contribution rate or rates for the correctional state employees retirement plan
56.5applied to the eligible employee's salary during that transfer period, plus compound interest
56.6at the monthly rate of 0.71 percent until June 30, 2015, and 0.667 percent per month
56.7thereafterapplicable monthly rate or rates specified in section 356.59, subdivision 2.
56.8    (d) The executive director shall compute an amount using the process specified in
56.9paragraph (b), but based on differences in employer contribution rates between the general
56.10state employees retirement plan and the correctional state employees retirement plan rather
56.11than employee contribution rates.
56.12    (e) The executive director shall compute an amount using the process specified in
56.13paragraph (c), but based on differences in employer contribution rates between the general
56.14state employees retirement plan and the correctional state employees retirement plan rather
56.15than employee contribution rates.
56.16    (f) The additional equivalent member contribution under this subdivision must be paid
56.17in a lump sum. Payment must accompany the election to transfer the prior service credit.
56.18No transfer election or additional equivalent member contribution payment may be made
56.19by a person or accepted by the executive director after the one year anniversary date of the
56.20effective date of the retirement coverage transfer, or the date on which the eligible employee
56.21terminates state employment, whichever is earlier.
56.22    (g) If an eligible employee elects to transfer past service credit under this section and
56.23pays the additional equivalent member contribution amount under paragraph (a), the
56.24applicable department shall pay an additional equivalent employer contribution amount.
56.25The additional employer contribution is the amount computed under paragraph (d), plus the
56.26greater of the amount computed under paragraph (e), or 60 percent of the unfunded actuarial
56.27accrued liability attributable to the past service credit transfer.
56.28    (h) The unfunded actuarial accrued liability attributable to the past service credit transfer
56.29is the present value of the benefit obtained by the transfer of the service credit to the
56.30correctional state employees retirement plan reduced by the amount of the asset transfer
56.31under subdivision 4, by the amount of the member contribution equivalent payment computed
56.32under paragraph (b), and by the amount of the employer contribution equivalent payment
56.33computed under paragraph (d).
57.1    (i) The additional equivalent employer contribution under this subdivision must be paid
57.2in a lump sum and must be paid within 30 days of the date on which the executive director
57.3of the Minnesota State Retirement System certifies to the applicable department that the
57.4employee paid the additional equivalent member contribution.
57.5EFFECTIVE DATE.This section is effective July 1, 2017.

57.6    Sec. 9. Minnesota Statutes 2016, section 352B.013, subdivision 2, is amended to read:
57.7    Subd. 2. Purchase procedure. (a) An employee covered by the plan specified in this
57.8chapter may purchase credit for allowable service in the plan for a period specified in
57.9subdivision 1 if the employee makes a payment as specified in paragraph (b) or (c), whichever
57.10applies. The employing unit, at its option, may pay the employer portion of the amount
57.11specified in paragraph (b) on behalf of its employees.
57.12(b) If payment is received by the executive director within one year from the date the
57.13employee returned to work following the authorized leave, the payment amount is equal to
57.14the employee and employer contribution rates specified in section 352B.02 at the end of
57.15the leave period multiplied by the employee's hourly rate of salary on the date of return
57.16from the leave of absence and by the days and months of the leave of absence for which
57.17the employee is eligible for allowable service credit. The payment must include compound
57.18interest at the monthly rate of 0.71 percent until June 30, 2015, and 0.667 percent per month
57.19thereafter applicable monthly rate or rates specified in section 356.59, subdivision 2, from
57.20the last day of the leave period until the last day of the month in which payment is received.
57.21If payment is received by the executive director after one year from the date the employee
57.22returned to work following the authorized leave, the payment amount is the amount
57.23determined under section 356.551. Payment under this paragraph must be made before the
57.24date of termination from public employment covered under this chapter.
57.25(c) If the employee terminates employment covered by this chapter during the leave or
57.26following the leave rather than returning to covered employment, payment must be received
57.27by the executive director within 30 days after the termination date. The payment amount is
57.28equal to the employee and employer contribution rates specified in section 352B.02 on the
57.29day prior to the termination date, multiplied by the employee's hourly rate of salary on that
57.30date and by the days and months of the leave of absence prior to termination.
57.31EFFECTIVE DATE.This section is effective July 1, 2017.

58.1    Sec. 10. Minnesota Statutes 2016, section 352B.085, is amended to read:
58.2352B.085 SERVICE CREDIT FOR CERTAIN DISABILITY LEAVES OF
58.3ABSENCE.
58.4A member on leave of absence receiving temporary workers' compensation payments
58.5and a reduced salary or no salary from the employer who is entitled to allowable service
58.6credit for the period of absence under section 352B.011, subdivision 3, paragraph (b), may
58.7make payment to the fund for the difference between salary received, if any, and the salary
58.8that the member would normally receive if the member was not on leave of absence during
58.9the period. The member shall pay an amount equal to the member and employer contribution
58.10rate under section 352B.02, subdivisions 1b and 1c, on the differential salary amount for
58.11the period of the leave of absence. The employing department, at its option, may pay the
58.12employer amount on behalf of the member. Payment made under this subdivision must
58.13include interest at the rate of 8.5 percent until June 30, 2015, and eight percent thereafter
58.14per year applicable annual rate or rates specified in section 356.59, subdivision 2, and must
58.15be completed within one year of the member's return from the leave of absence.
58.16EFFECTIVE DATE.This section is effective July 1, 2017.

58.17    Sec. 11. Minnesota Statutes 2016, section 352B.086, is amended to read:
58.18352B.086 SERVICE CREDIT FOR UNIFORMED SERVICE.
58.19(a) A member who is absent from employment by reason of service in the uniformed
58.20services, as defined in United States Code, title 38, section 4303(13), and who returns to
58.21state employment in a position covered by the plan upon discharge from service in the
58.22uniformed services within the time frame required in United States Code, title 38, section
58.234312(e), may obtain service credit for the period of the uniformed service, provided that
58.24the member did not separate from uniformed service with a dishonorable or bad conduct
58.25discharge or under other than honorable conditions.
58.26(b) The member may obtain credit by paying into the fund an equivalent member
58.27contribution based on the member contribution rate or rates in effect at the time that the
58.28uniformed service was performed multiplied by the full and fractional years being purchased
58.29and applied to the annual salary rate. The annual salary rate is the average annual salary
58.30during the purchase period that the member would have received if the member had continued
58.31to provide employment services to the state rather than to provide uniformed service, or if
58.32the determination of that rate is not reasonably certain, the annual salary rate is the member's
59.1average salary rate during the 12-month period of covered employment rendered immediately
59.2preceding the purchase period.
59.3(c) The equivalent employer contribution and, if applicable, the equivalent employer
59.4additional contribution, must be paid by the employing unit, using the employer and employer
59.5additional contribution rate or rates in effect at the time that the uniformed service was
59.6performed, applied to the same annual salary rate or rates used to compute the equivalent
59.7member contribution.
59.8(d) If the member equivalent contributions provided for in this section are not paid in
59.9full, the member's allowable service credit must be prorated by multiplying the full and
59.10fractional number of years of uniformed service eligible for purchase by the ratio obtained
59.11by dividing the total member contributions received by the total member contributions
59.12otherwise required under this section.
59.13(e) To receive allowable service credit under this section, the contributions specified in
59.14this section must be transmitted to the fund during the period which begins with the date
59.15on which the individual returns to state employment covered by the plan and which has a
59.16duration of three times the length of the uniformed service period, but not to exceed five
59.17years. If the determined payment period is calculated to be less than one year, the
59.18contributions required under this section to receive service credit must be transmitted to the
59.19fund within one year from the discharge date.
59.20(f) The amount of allowable service credit obtainable under this section may not exceed
59.21five years, unless a longer purchase period is required under United States Code, title 38,
59.22section 4312.
59.23(g) The employing unit shall pay interest on all equivalent member and employer
59.24contribution amounts payable under this section. Interest must be computed at the rate of
59.258.5 percent until June 30, 2015, and eight percent thereafter applicable annual rate or rates
59.26specified in section 356.59, subdivision 2, compounded annually, from the end of each
59.27fiscal year of the leave or break in service to the end of the month in which payment is
59.28received.
59.29EFFECTIVE DATE.This section is effective July 1, 2017.

59.30    Sec. 12. Minnesota Statutes 2016, section 352B.11, subdivision 4, is amended to read:
59.31    Subd. 4. Reentry into state service; refund repayment. (a) When a former member,
59.32who has become separated from state service that entitled the member to membership and
59.33has received a refund of retirement payments, reenters the state service in a position that
60.1entitles the member to membership, that member shall receive credit for the period of prior
60.2allowable state service if the member repays into the fund the amount of the refund, plus
60.3interest on it at the rate of 8.5 percent until June 30, 2015, and eight percent thereafter at
60.4the applicable annual rate or rates specified in section 356.59, subdivision 2, compounded
60.5annually, at any time before subsequent retirement. Repayment may be made in installments
60.6or in a lump sum.
60.7(b) A person who has received a refund from the State Patrol retirement fund who is a
60.8member of a public retirement system included in section 356.311 may repay the refund
60.9with interest to the State Patrol retirement fund as provided in paragraph (a).
60.10EFFECTIVE DATE.This section is effective July 1, 2017.

60.11    Sec. 13. Minnesota Statutes 2016, section 352D.05, subdivision 4, is amended to read:
60.12    Subd. 4. Repayment of refund. (a) A participant in the unclassified program may repay
60.13regular refunds taken under section 352.22, as provided in section 352.23.
60.14(b) A participant in the unclassified program or an employee covered by the general
60.15employees retirement plan who has withdrawn the value of the total shares may repay the
60.16refund taken and thereupon restore the service credit, rights and benefits forfeited by paying
60.17into the fund the amount refunded plus interest at the rate of 8.5 percent until June 30, 2015,
60.18and eight percent thereafter applicable annual rate or rates specified in section 356.59,
60.19subdivision 2, compounded annually, from the date that the refund was taken until the date
60.20that the refund is repaid. If the participant had withdrawn only the employee shares as
60.21permitted under prior laws, repayment must be pro rata.
60.22(c) Except as provided in section 356.441, the repayment of a refund under this section
60.23must be made in a lump sum.
60.24EFFECTIVE DATE.This section is effective July 1, 2017.

60.25    Sec. 14. Minnesota Statutes 2016, section 352D.11, subdivision 2, is amended to read:
60.26    Subd. 2. Payments by employee. An employee entitled to purchase service credit may
60.27make the purchase by paying to the state retirement system an amount equal to the current
60.28employee contribution rate in effect for the state retirement system applied to the current
60.29or final salary rate multiplied by the months and days of prior temporary, intermittent, or
60.30contract legislative service. Payment shall be made in one lump sum unless the executive
60.31director of the state retirement system agrees to accept payment in installments over a period
60.32of not more than three years from the date of the agreement. Installment payments shall be
61.1charged interest at the rate of 8.5 percent until June 30, 2015, and eight percent thereafter
61.2applicable annual rate or rates specified in section 356.59, subdivision 2, compounded
61.3annually.
61.4EFFECTIVE DATE.This section is effective July 1, 2017.

61.5    Sec. 15. Minnesota Statutes 2016, section 352D.12, is amended to read:
61.6352D.12 TRANSFER OF PRIOR SERVICE CONTRIBUTIONS.
61.7(a) An employee who is a participant in the unclassified program and who has prior
61.8service credit in a covered plan under chapter 352, 353, 354, 354A, or 422A may, within
61.9the time limits specified in this section, elect to transfer to the unclassified program prior
61.10service contributions to one or more of those plans.
61.11(b) For participants with prior service credit in a plan governed by chapter 352, 353,
61.12354, 354A, or 422A, "prior service contributions" means the accumulated employee and
61.13equal employer contributions with interest at the rate of 8.5 percent until June 30, 2015,
61.14and eight percent thereafter applicable annual rate or rates specified in section 356.59,
61.15subdivision 2, compounded annually, based on fiscal year balances.
61.16(c) If a participant has taken a refund from a retirement plan listed in this section, the
61.17participant may repay the refund to that plan, notwithstanding any restrictions on repayment
61.18to that plan, plus 8.5 percent interest until June 30, 2015, and eight percent interest thereafter
61.19with interest at the applicable annual rate or rates specified in section 356.59, subdivision
61.202, compounded annually, and have the accumulated employee and equal employer
61.21contributions transferred to the unclassified program with interest at the rate of 8.5 percent
61.22until June 30, 2015, and eight percent thereafter compounded annually based on fiscal year
61.23balances. If a person repays a refund and subsequently elects to have the money transferred
61.24to the unclassified program, the repayment amount, including interest, is added to the fiscal
61.25year balance in the year which the repayment was made.
61.26(d) A participant electing to transfer prior service contributions credited to a retirement
61.27plan governed by chapter 352, 353, 354, 354A, or 422A as provided under this section must
61.28complete a written application for the transfer and repay any refund within one year of the
61.29commencement of the employee's participation in the unclassified program.
61.30EFFECTIVE DATE.This section is effective July 1, 2017.

61.31    Sec. 16. Minnesota Statutes 2016, section 353.01, subdivision 16, is amended to read:
61.32    Subd. 16. Allowable service; limits and computation. (a) "Allowable service" means:
62.1    (1) service during years of actual membership in the course of which employee deductions
62.2were withheld from salary and contributions were made at the applicable rates under section
62.3353.27 , 353.65, or 353E.03;
62.4(2) periods of service covered by payments in lieu of salary deductions under sections
62.5353.27, subdivisions 12 and 12a, and 353.35;
62.6    (3) service in years during which the public employee was not a member but for which
62.7the member later elected, while a member, to obtain credit by making payments to the fund
62.8as permitted by any law then in effect;
62.9    (4) a period of authorized leave of absence during which the employee receives pay as
62.10specified in subdivision 10, paragraph (a), clause (4) or (5), from which deductions for
62.11employee contributions are made, deposited, and credited to the fund;
62.12    (5) a period of authorized leave of absence without pay, or with pay that is not included
62.13in the definition of salary under subdivision 10, paragraph (a), clause (4) or (5), for which
62.14salary deductions are not authorized, and for which a member obtained service credit for
62.15up to 12 months of the authorized leave period by payment under section 353.0161 or
62.16353.0162 , to the fund made in place of salary deductions;
62.17    (6) a periodic, repetitive leave that is offered to all employees of a governmental
62.18subdivision. The leave program may not exceed 208 hours per annual normal work cycle
62.19as certified to the association by the employer. A participating member obtains service credit
62.20by making employee contributions in an amount or amounts based on the member's average
62.21salary, excluding overtime pay, that would have been paid if the leave had not been taken.
62.22The employer shall pay the employer and additional employer contributions on behalf of
62.23the participating member. The employee and the employer are responsible to pay interest
62.24on their respective shares at the rate of 8.5 percent until June 30, 2015, and eight percent
62.25thereafter applicable rate or rates specified in section 356.59, subdivision 3, compounded
62.26annually, from the end of the normal cycle until full payment is made. An employer shall
62.27also make the employer and additional employer contributions, plus 8.5 percent interest
62.28until June 30, 2015, and eight percent interest thereafterat the applicable rate or rates specified
62.29in section 356.59, subdivision 3, compounded annually, on behalf of an employee who
62.30makes employee contributions but terminates public service. The employee contributions
62.31must be made within one year after the end of the annual normal working cycle or within
62.3230 days after termination of public service, whichever is sooner. The executive director
62.33shall prescribe the manner and forms to be used by a governmental subdivision in
63.1administering a periodic, repetitive leave. Upon payment, the member must be granted
63.2allowable service credit for the purchased period;
63.3    (7) an authorized temporary or seasonal layoff under subdivision 12, limited to three
63.4months allowable service per authorized temporary or seasonal layoff in one calendar year.
63.5An employee who has received the maximum service credit allowed for an authorized
63.6temporary or seasonal layoff must return to public service and must obtain a minimum of
63.7three months of allowable service subsequent to the layoff in order to receive allowable
63.8service for a subsequent authorized temporary or seasonal layoff;
63.9    (8) a period during which a member is absent from employment by a governmental
63.10subdivision by reason of service in the uniformed services, as defined in United States Code,
63.11title 38, section 4303(13), if the member returns to public service with the same governmental
63.12subdivision upon discharge from service in the uniformed service within the time frames
63.13required under United States Code, title 38, section 4312(e), provided that the member did
63.14not separate from uniformed service with a dishonorable or bad conduct discharge or under
63.15other than honorable conditions. The service must be credited if the member pays into the
63.16fund equivalent employee contributions based upon the contribution rate or rates in effect
63.17at the time that the uniformed service was performed multiplied by the full and fractional
63.18years being purchased and applied to the annual salary rate. The annual salary rate is the
63.19average annual salary during the purchase period that the member would have received if
63.20the member had continued to be employed in covered employment rather than to provide
63.21uniformed service, or, if the determination of that rate is not reasonably certain, the annual
63.22salary rate is the member's average salary rate during the 12-month period of covered
63.23employment rendered immediately preceding the period of the uniformed service. Payment
63.24of the member equivalent contributions must be made during a period that begins with the
63.25date on which the individual returns to public employment and that is three times the length
63.26of the military leave period, or within five years of the date of discharge from the military
63.27service, whichever is less. If the determined payment period is less than one year, the
63.28contributions required under this clause to receive service credit may be made within one
63.29year of the discharge date. Payment may not be accepted following 30 days after termination
63.30of public service under subdivision 11a. If the member equivalent contributions provided
63.31for in this clause are not paid in full, the member's allowable service credit must be prorated
63.32by multiplying the full and fractional number of years of uniformed service eligible for
63.33purchase by the ratio obtained by dividing the total member contributions received by the
63.34total member contributions otherwise required under this clause. The equivalent employer
63.35contribution, and, if applicable, the equivalent additional employer contribution must be
64.1paid by the governmental subdivision employing the member if the member makes the
64.2equivalent employee contributions. The employer payments must be made from funds
64.3available to the employing unit, using the employer and additional employer contribution
64.4rate or rates in effect at the time that the uniformed service was performed, applied to the
64.5same annual salary rate or rates used to compute the equivalent member contribution. The
64.6governmental subdivision involved may appropriate money for those payments. The amount
64.7of service credit obtainable under this section may not exceed five years unless a longer
64.8purchase period is required under United States Code, title 38, section 4312. The employing
64.9unit shall pay interest on all equivalent member and employer contribution amounts payable
64.10under this clause. Interest must be computed at the rate of 8.5 percent until June 30, 2015,
64.11and eight percent thereafter applicable rate or rates specified in section 356.59, subdivision
64.123, compounded annually, from the end of each fiscal year of the leave or the break in service
64.13to the end of the month in which the payment is received. Upon payment, the employee
64.14must be granted allowable service credit for the purchased period; or
64.15(9) a period specified under section 353.0162.
64.16    (b) No member may receive more than 12 months of allowable service credit in a year
64.17either for vesting purposes or for benefit calculation purposes.
64.18    (c) For an active member who was an active member of the former Minneapolis
64.19Firefighters Relief Association on December 29, 2011, "allowable service" is the period of
64.20service credited by the Minneapolis Firefighters Relief Association as reflected in the
64.21transferred records of the association up to December 30, 2011, and the period of service
64.22credited under paragraph (a), clause (1), after December 30, 2011. For an active member
64.23who was an active member of the former Minneapolis Police Relief Association on December
64.2429, 2011, "allowable service" is the period of service credited by the Minneapolis Police
64.25Relief Association as reflected in the transferred records of the association up to December
64.2630, 2011, and the period of service credited under paragraph (a), clause (1), after December
64.2730, 2011.
64.28EFFECTIVE DATE.This section is effective July 1, 2017.

64.29    Sec. 17. Minnesota Statutes 2016, section 353.0161, subdivision 2, is amended to read:
64.30    Subd. 2. Purchase procedure. (a) An employee covered by a plan specified in
64.31subdivision 1 may purchase credit for allowable service in that plan for a period specified
64.32in subdivision 1 if the employee makes a payment as specified in paragraph (b) or (c),
64.33whichever applies. The employing unit, at its option, may pay the employer portion of the
64.34amount specified in paragraph (b) on behalf of its employees.
65.1    (b) If payment is received by the executive director within one year from the date the
65.2member returned to work following the authorized leave, or within 30 days after the date
65.3of termination of public service if the member did not return to work, the payment amount
65.4is equal to the employee and employer contribution rates specified in law for the applicable
65.5plan at the end of the leave period, or at termination of public service, whichever is earlier,
65.6multiplied by the employee's average monthly salary, excluding overtime, upon which
65.7deductions were paid during the six months, or portion thereof, before the commencement
65.8of the leave of absence and by the number of months of the leave of absence for which the
65.9employee wants allowable service credit. Payments made under this paragraph must include
65.10compound interest at the monthly rate of 0.71 percent until June 30, 2015, and 0.667 percent
65.11applicable rate or rates specified in section 356.59, subdivision 2, per month thereafter ,
65.12compounded annually,from the last day of the leave period until the last day of the month
65.13in which payment is received.
65.14    (c) If payment is received by the executive director after one year, the payment amount
65.15is the amount determined under section 356.551. Payment under this paragraph must be
65.16made before the date the person terminates public service under section 353.01, subdivision
65.1711a.
65.18EFFECTIVE DATE.This section is effective July 1, 2017.

65.19    Sec. 18. Minnesota Statutes 2016, section 353.0162, is amended to read:
65.20353.0162 REDUCED SALARY PERIODS SALARY CREDIT PURCHASE.
65.21(a) A member may purchase additional salary credit for a period specified in this section.
65.22(b) The applicable period is a period during which the member is receiving a reduced
65.23salary from the employer while the member is:
65.24(1) receiving temporary workers' compensation payments related to the member's service
65.25to the public employer;
65.26(2) on an authorized leave of absence; or
65.27(3) on an authorized partial paid leave of absence as a result of a budgetary or salary
65.28savings program offered or mandated by a governmental subdivision.
65.29(c) The differential salary amount is the difference between the average monthly salary
65.30received by the member during the period of reduced salary under this section and the
65.31average monthly salary of the member, excluding overtime, on which contributions to the
65.32applicable plan were made during the period of the last six months of covered employment
66.1occurring immediately before the period of reduced salary, applied to the member's normal
66.2employment period, measured in hours or otherwise, as applicable.
66.3(d) To receive eligible salary credit, the member shall pay an amount equal to:
66.4(1) the applicable employee contribution rate under section 353.27, subdivision 2; 353.65,
66.5subdivision 2 ; or 353E.03, subdivision 1, as applicable, multiplied by the differential salary
66.6amount;
66.7(2) plus an employer equivalent payment equal to the applicable employer contribution
66.8rate in section 353.27, subdivision 3; 353.65, subdivision 3; or 353E.03, subdivision 2, as
66.9applicable, multiplied by the differential salary amount;
66.10(3) plus, if applicable, an equivalent employer additional amount equal to the additional
66.11employer contribution rate in section 353.27, subdivision 3a, multiplied by the differential
66.12salary amount.
66.13(e) The employer, by appropriate action of its governing body and documented in its
66.14official records, may pay the employer equivalent contributions and, as applicable, the
66.15equivalent employer additional contributions on behalf of the member.
66.16(f) Payment under this section must include interest on the contribution amount or
66.17amounts, whichever applies, at an 8.5 percent annual rate until June 30, 2015, and at an
66.18eight percent annual rate thereafter the applicable rate or rates specified in section 356.59,
66.19subdivision 3, compounded annually, prorated for applicable the number of months, if less
66.20than 12, from the date on which the period of reduced salary specified under this section
66.21terminates to the date on which the payment or payments are received by the executive
66.22director. Payment under this section must be completed within the earlier of 30 days from
66.23termination of public service by the employee under section 353.01, subdivision 11a, or
66.24one year after the termination of the period specified in paragraph (b), as further restricted
66.25under this section.
66.26(g) The period for which additional allowable salary credit may be purchased is limited
66.27to the period during which the person receives temporary workers' compensation payments
66.28or for those business years in which the governmental subdivision offers or mandates a
66.29budget or salary savings program, as certified to the executive director by a resolution of
66.30the governing body of the governmental subdivision. For an authorized leave of absence,
66.31the period for which allowable salary credit may be purchased may not exceed 12 months
66.32of authorized leave.
67.1(h) To purchase salary credit for a subsequent period of temporary workers' compensation
67.2benefits or subsequent authorized medical leave of absence, the member must return to
67.3public service and render a minimum of three months of allowable service.
67.4EFFECTIVE DATE.This section is effective July 1, 2017.

67.5    Sec. 19. Minnesota Statutes 2016, section 353.27, subdivision 3c, is amended to read:
67.6    Subd. 3c. Former MERF members; member and employer contributions. (a) For
67.7the period July 1, 2015, through December 31, 2031, the member contributions for former
67.8members of the Minneapolis Employees Retirement Fund and by the former Minneapolis
67.9Employees Retirement Fund-covered employing units are governed by this subdivision.
67.10(b) The member contribution for a public employee who was a member of the former
67.11Minneapolis Employees Retirement Fund on June 29, 2010, is 9.75 percent of the salary of
67.12the employee.
67.13(c) The employer regular contribution with respect to a public employee who was a
67.14member of the former Minneapolis Employees Retirement Fund on June 29, 2010, is 9.75
67.15percent of the salary of the employee.
67.16(d) For calendar years 2015 and 2016, the employer supplemental contribution is the
67.17employing unit's share of $31,000,000. For calendar years 2017 through 2031, the employer
67.18supplemental contribution is the employing unit's share of $21,000,000.
67.19(e) Each employing unit's share under paragraph (d) is the amount determined from an
67.20allocation between each employing unit in the portion equal to the unit's employer
67.21supplemental contribution paid or payable under Minnesota Statutes 2012, section 353.50,
67.22during calendar year 2014.
67.23(f) The employer supplemental contribution amount under paragraph (d) for calendar
67.24year 2015 must be invoiced by the executive director of the Public Employees Retirement
67.25Association by July 1, 2015. The calendar year 2015 payment is payable in a single amount
67.26on or before September 30, 2015. For subsequent calendar years, the employer supplemental
67.27contribution under paragraph (d) must be invoiced on January 31 of each year and is payable
67.28in two parts, with the first half payable on or before July 31 and with the second half payable
67.29on or before December 15. Late payments are payable with compound interest, compounded
67.30annually, at the rate of 0.71 percent applicable rate or rates specified in section 356.59,
67.31subdivision 3, per month for each month or portion of a month that has elapsed after the
67.32due date.
68.1(g) The employer supplemental contribution under paragraph (d) terminates on December
68.231, 2031.
68.3EFFECTIVE DATE.This section is effective July 1, 2017.

68.4    Sec. 20. Minnesota Statutes 2016, section 353.27, subdivision 7a, is amended to read:
68.5    Subd. 7a. Deductions or contributions transmitted by error. (a) If employee deductions
68.6and employer contributions under this section, section 353.50, 353.65, or 353E.03 were
68.7erroneously transmitted to the association, but should have been transmitted to a plan covered
68.8by chapter 352D, 353D, 354B, or 354D, the executive director shall transfer the erroneous
68.9employee deductions and employer contributions to the appropriate retirement fund or
68.10individual account, as applicable. The time limitations specified in subdivisions 7 and 12
68.11do not apply. The transfer to the applicable defined contribution plan account must include
68.12interest at the rate of 0.71 percent per month until June 30, 2015, and 0.667 percent applicable
68.13rate or rates specified in section 356.59, subdivision 3, per month thereafter, compounded
68.14annually, from the first day of the month following the month in which coverage should
68.15have commenced in the defined contribution plan until the end of the month in which the
68.16transfer occurs.
68.17(b) A potential transfer under paragraph (a) that is reasonably determined to cause the
68.18plan to fail to be a qualified plan under section 401(a) of the federal Internal Revenue Code,
68.19as amended, must not be made by the executive director of the association. Within 30 days
68.20after being notified by the Public Employees Retirement Association of an unmade potential
68.21transfer under this paragraph, the employer of the affected person must transmit an amount
68.22representing the applicable salary deductions and employer contributions, without interest,
68.23to the retirement fund of the appropriate Minnesota public pension plan, or to the applicable
68.24individual account if the proper coverage is by a defined contribution plan. The association
68.25must provide the employing unit a credit for the amount of the erroneous salary deductions
68.26and employer contributions against future contributions from the employer. If the employing
68.27unit receives a credit under this paragraph, the employing unit is responsible for refunding
68.28to the applicable employee any amount that had been erroneously deducted from the person's
68.29salary.
68.30(c) If erroneous employee deductions and employer contributions reflect a plan coverage
68.31error involving any Public Employees Retirement Association plan specified in section
68.32356.99 and any other plan specified in that section, section 356.99 applies.
68.33EFFECTIVE DATE.This section is effective July 1, 2017.

69.1    Sec. 21. Minnesota Statutes 2016, section 353.27, subdivision 12, is amended to read:
69.2    Subd. 12. Omitted salary deductions; obligations. (a) In the case of omission of
69.3required deductions for the general employees retirement plan, the public employees police
69.4and fire retirement plan, or the local government correctional employees retirement plan
69.5from the salary of an employee, the department head or designee shall immediately, upon
69.6discovery, report the employee for membership and deduct the employee deductions under
69.7subdivision 4 during the current pay period or during the pay period immediately following
69.8the discovery of the omission. Payment for the omitted obligations may only be made in
69.9accordance with reporting procedures and methods established by the executive director.
69.10(b) When the entire omission period of an employee does not exceed 60 days, the
69.11governmental subdivision may report and submit payment of the omitted employee
69.12deductions and the omitted employer contributions through the reporting processes under
69.13subdivision 4.
69.14(c) When the omission period of an employee exceeds 60 days, the governmental
69.15subdivision shall furnish to the association sufficient data and documentation upon which
69.16the obligation for omitted employee and employer contributions can be calculated. The
69.17omitted employee deductions must be deducted from the employee's subsequent salary
69.18payment or payments and remitted to the association for deposit in the applicable retirement
69.19fund. The employee shall pay omitted employee deductions due for the 60 days prior to the
69.20end of the last pay period in the omission period during which salary was earned. The
69.21employer shall pay any remaining omitted employee deductions and any omitted employer
69.22contributions, plus cumulative interest at the annual rate of 8.5 percent until June 30, 2015,
69.23and eight percent thereafter compounded annually, from the date or dates each omitted
69.24employee contribution was first payable.
69.25(d) An employer shall not hold an employee liable for omitted employee deductions
69.26beyond the pay period dates under paragraph (c), nor attempt to recover from the employee
69.27those employee deductions paid by the employer on behalf of the employee. Omitted
69.28deductions due under paragraph (c) which are not paid by the employee constitute a liability
69.29of the employer that failed to deduct the omitted deductions from the employee's salary.
69.30The employer shall make payment with interest at the annual rate of 8.5 percent until June
69.3130, 2015, and eight percent thereafter applicable rate or rates specified in section 356.59,
69.32subdivision 3, compounded annually. Omitted employee deductions are no longer due if an
69.33employee terminates public service before making payment of omitted employee deductions
69.34to the association, but the employer remains liable to pay omitted employer contributions
69.35plus interest at the annual rate of 8.5 percent until June 30, 2015, and eight percent thereafter
70.1applicable rate or rates specified in section 356.59, subdivision 3, compounded annually,
70.2from the date the contributions were first payable.
70.3(e) The association may not commence action for the recovery of omitted employee
70.4deductions and employer contributions after the expiration of three calendar years after the
70.5calendar year in which the contributions and deductions were omitted. Except as provided
70.6under paragraph (b), no payment may be made or accepted unless the association has already
70.7commenced action for recovery of omitted deductions. An action for recovery commences
70.8on the date of the mailing of any written correspondence from the association requesting
70.9information from the governmental subdivision upon which to determine whether or not
70.10omitted deductions occurred.
70.11EFFECTIVE DATE.This section is effective July 1, 2017.

70.12    Sec. 22. Minnesota Statutes 2016, section 353.27, subdivision 12a, is amended to read:
70.13    Subd. 12a. Terminated employees: omitted deductions. A terminated employee who
70.14was a member of the general employees retirement plan of the Public Employees Retirement
70.15Association, the public employees police and fire retirement plan, or the local government
70.16correctional employees retirement plan and who has a period of employment in which
70.17previously omitted employer contributions were made under subdivision 12 but for whom
70.18no, or only partial, omitted employee contributions have been made, or a member who had
70.19prior coverage in the association for which previously omitted employer contributions were
70.20made under subdivision 12 but who terminated service before required omitted employee
70.21deductions could be withheld from salary, may pay the omitted employee deductions for
70.22the period on which omitted employer contributions were previously paid plus interest at
70.23the annual rate of 8.5 percent until June 30, 2015, and eight percent thereafter applicable
70.24rate or rates specified in section 356.59, subdivision 3, compounded annually. A terminated
70.25employee may pay the omitted employee deductions plus interest within six months of an
70.26initial notification from the association of eligibility to pay those omitted deductions. If a
70.27terminated employee is reemployed in a position covered under a public pension fund under
70.28section 356.30, subdivision 3, and elects to pay omitted employee deductions, payment
70.29must be made no later than six months after a subsequent termination of public service.
70.30EFFECTIVE DATE.This section is effective July 1, 2017.

70.31    Sec. 23. Minnesota Statutes 2016, section 353.27, subdivision 12b, is amended to read:
70.32    Subd. 12b. Terminated employees: immediate eligibility. If deductions were omitted
70.33from salary adjustments or final salary of a terminated employee who was a member of the
71.1general employees retirement plan, the public employees police and fire retirement plan,
71.2or the local government correctional employees retirement plan and who is immediately
71.3eligible to draw a monthly benefit, the employer shall pay the omitted employer and employer
71.4additional contributions plus interest on both the employer and employee amounts due at
71.5an annual rate of 8.5 percent the applicable rate or rates specified in section 356.59,
71.6subdivision 3, compounded annually. The employee shall pay the employee deductions
71.7within six months of an initial notification from the association of eligibility to pay omitted
71.8deductions or the employee forfeits the right to make the payment.
71.9EFFECTIVE DATE.This section is effective July 1, 2017.

71.10    Sec. 24. Minnesota Statutes 2016, section 353.28, subdivision 5, is amended to read:
71.11    Subd. 5. Interest chargeable on amounts due. Any amount due under this section or
71.12section 353.27, subdivision 4, is payable with interest at the annual compound rate of 8.5
71.13percent until June 30, 2015, and eight percent thereafter applicable rate or rates specified
71.14in section 356.59, subdivision 3, compounded annually, from the date due until the date
71.15payment is received by the association, with a minimum interest charge of $10.
71.16EFFECTIVE DATE.This section is effective July 1, 2017.

71.17    Sec. 25. Minnesota Statutes 2016, section 353.35, subdivision 1, is amended to read:
71.18    Subdivision 1. Refund rights. (a) Except as provided in paragraph (b), when any former
71.19member accepts a refund, all existing service credits and all rights and benefits to which
71.20the person was entitled prior to the acceptance of the refund must terminate.
71.21(b) A refund under section 353.651, subdivision 3, paragraph (c), does not result in a
71.22forfeiture of salary credit for the allowable service credit covered by the refund.
71.23(c) The rights and benefits of a former member must not be restored until the person
71.24returns to active service and acquires at least six months of allowable service credit after
71.25taking the last refund and repays the refund or refunds taken and interest received under
71.26section 353.34, subdivisions 1 and 2, plus interest at the annual rate of 8.5 percent until June
71.2730, 2015, and eight percent thereafter applicable rate or rates specified in section 356.59,
71.28subdivision 3, compounded annually. If the person elects to restore service credit in a
71.29particular fund from which the person has taken more than one refund, the person must
71.30repay all refunds to that fund. All refunds must be repaid within six months of the last date
71.31of termination of public service.
71.32EFFECTIVE DATE.This section is effective July 1, 2017.

72.1    Sec. 26. Minnesota Statutes 2016, section 354.50, subdivision 2, is amended to read:
72.2    Subd. 2. Interest charge. If a member desires to repay the refunds, payment shall include
72.3interest at an annual rate of 8.5 percent the applicable annual rate or rates specified in section
72.4356.59, subdivision 4, compounded annually, from date of withdrawal to the date payment
72.5is made and shall be credited to the fund.
72.6EFFECTIVE DATE.This section is effective July 1, 2017.

72.7    Sec. 27. Minnesota Statutes 2016, section 354.51, subdivision 5, is amended to read:
72.8    Subd. 5. Payment of shortages. (a) Except as provided in paragraph (b), in the event
72.9that full required member contributions are not deducted from the salary of a teacher,
72.10payment of shortages in member deductions on salary earned are the sole obligation of the
72.11employing unit and are payable by the employing unit upon notification by the executive
72.12director of the shortage. The amount of the shortage shall be paid with interest at an annual
72.13rate of 8.5 percent the applicable annual rate or rates specified in section 356.59, subdivision
72.144, compounded annually, from the end of the fiscal year in which the shortage occurred to
72.15the end of the month in which payment is made and the interest must be credited to the
72.16fund. The employing unit shall also pay the employer contributions as specified in section
72.17354.42 , subdivisions 3 and 5 for the shortages. If the shortage payment is not paid by the
72.18employing unit within 60 days of notification, and if the executive director does not use the
72.19recovery procedure in section 354.512, the executive director shall certify the amount of
72.20the shortage to the applicable county auditor, who shall spread a levy in the amount of the
72.21shortage payment over the taxable property of the taxing district of the employing unit if
72.22the employing unit is supported by property taxes. Payment may not be made for shortages
72.23in member deductions on salary paid or payable under paragraph (b) or for shortages in
72.24member deductions for persons employed by the Minnesota State Colleges and Universities
72.25system in a faculty position or in an eligible unclassified administrative position and whose
72.26employment was less than 25 percent of a full academic year, exclusive of the summer
72.27session, for the applicable institution that exceeds the most recent 36 months.
72.28(b) For a person who is employed by the Minnesota State Colleges and Universities
72.29system in a faculty position or in an eligible unclassified administrative position and whose
72.30employment was less than 25 percent of a full academic year, exclusive of the summer
72.31session, for the applicable institution, upon the person's election under section 354B.21 of
72.32retirement coverage under this chapter, the shortage in member deductions on the salary
72.33for employment by the Minnesota State Colleges and Universities system institution of less
72.34than 25 percent of a full academic year, exclusive of the summer session, for the applicable
73.1institution for the most recent 36 months and the associated employer contributions must
73.2be paid by the Minnesota State Colleges and Universities system institution, plus annual
73.3compound interest at the rate of 8.5 percent applicable annual rate or rates specified in
73.4section 356.589, subdivision 4, compounded annually, from the end of the fiscal year in
73.5which the shortage occurred to the end of the month in which the Teachers Retirement
73.6Association coverage election is made. An individual electing coverage under this paragraph
73.7shall repay the amount of the shortage in member deductions, plus interest, through deduction
73.8from salary or compensation payments within the first year of employment after the election
73.9under section 354B.21, subject to the limitations in section 16D.16. The Minnesota State
73.10Colleges and Universities system may use any means available to recover amounts which
73.11were not recovered through deductions from salary or compensation payments. No payment
73.12of the shortage in member deductions under this paragraph may be made for a period longer
73.13than the most recent 36 months.
73.14EFFECTIVE DATE.This section is effective July 1, 2017.

73.15    Sec. 28. Minnesota Statutes 2016, section 354.52, subdivision 4, is amended to read:
73.16    Subd. 4. Reporting and remittance requirements. An employer shall remit all amounts
73.17due to the association and furnish a statement indicating the amount due and transmitted
73.18with any other information required by the executive director. If an amount due is not
73.19received by the association within 14 calendar days of the payroll warrant, the amount
73.20accrues interest at an annual rate of 8.5 percent employer shall pay interest on the amount
73.21due at the applicable annual rate or rates specified in section 356.59, subdivision 4,
73.22compounded annually, from the due date until the amount is received by the association.
73.23All amounts due and other employer obligations not remitted within 60 days of notification
73.24by the association must be certified to the commissioner of management and budget who
73.25shall deduct the amount from any state aid or appropriation amount applicable to the
73.26employing unit.
73.27EFFECTIVE DATE.This section is effective July 1, 2017.

73.28    Sec. 29. Minnesota Statutes 2016, section 354.53, subdivision 5, is amended to read:
73.29    Subd. 5. Interest requirements. The employer shall pay interest on all equivalent
73.30employee and employer contribution amounts payable under this section. Interest must be
73.31computed at a rate of 8.5 percent at the applicable annual rate or rates specified in section
73.32356.59, subdivision 4, compounded annually, from the end of each fiscal year of the leave
73.33or the break in service to the end of the month in which the payment is received.
74.1EFFECTIVE DATE.This section is effective July 1, 2017.

74.2    Sec. 30. Minnesota Statutes 2016, section 354A.093, subdivision 6, is amended to read:
74.3    Subd. 6. Interest requirements. The employer shall pay interest on all equivalent
74.4employee and employer contribution amounts payable under this section. Interest must be
74.5computed at the rate of 8.5 percent until June 30, 2015, and eight percent thereafter applicable
74.6annual rate or rates specified in section 356.59, subdivision 5, compounded annually, from
74.7the end of each fiscal year of the leave or break in service to the end of the month in which
74.8payment is received.
74.9EFFECTIVE DATE.This section is effective July 1, 2017.

74.10    Sec. 31. Minnesota Statutes 2016, section 354A.096, is amended to read:
74.11354A.096 MEDICAL LEAVE.
74.12Any teacher in the coordinated program of the St. Paul Teachers Retirement Fund
74.13Association who is on an authorized medical leave of absence and subsequently returns to
74.14teaching service is entitled to receive allowable service credit, not to exceed one year, for
74.15the period of leave, upon making the prescribed payment to the fund. This payment must
74.16include the required employee and employer contributions at the rates specified in section
74.17354A.12 , subdivisions 1 and 2a, as applied to the member's average full-time monthly salary
74.18rate on the date the leave of absence commenced plus annual interest at the rate of 8.5
74.19percent until June 30, 2015, and eight percent thereafter per year applicable annual rate or
74.20rates specified in section 356.59, subdivision 5, compounded annually, from the end of the
74.21fiscal year during which the leave terminates to the end of the month during which payment
74.22is made. The member must pay the total amount required unless the employing unit, at its
74.23option, pays the employer contributions. The total amount required must be paid by the end
74.24of the fiscal year following the fiscal year in which the leave of absence terminated or before
74.25the member retires, whichever is earlier. Payment must be accompanied by a copy of the
74.26resolution or action of the employing authority granting the leave and the employing
74.27authority, upon granting the leave, must certify the leave to the association in a manner
74.28specified by the executive director. A member may not receive more than one year of
74.29allowable service credit during any fiscal year by making payment under this section. A
74.30member may not receive disability benefits under section 354A.36 and receive allowable
74.31service credit under this section for the same period of time.
74.32EFFECTIVE DATE.This section is effective July 1, 2017.

75.1    Sec. 32. Minnesota Statutes 2016, section 354A.12, subdivision 1a, is amended to read:
75.2    Subd. 1a. Obligation for omitted salary deductions. If the full required contributions
75.3are not deducted from the salary of a teacher, payment of the shortage in such deductions
75.4is the sole obligation of the employing unit during the three-year period following the end
75.5of the fiscal year in which the shortage occurred. The shortage is payable by the employing
75.6unit upon notification of the shortage by the executive director of the applicable retirement
75.7fund association. The employing unit shall also pay any employer contributions related to
75.8the shortage. The amount of the shortage in employee contributions and associated employer
75.9contributions is payable with interest at the preretirement interest assumption for the
75.10retirement fund as specified in section 356.215, subdivision 8, stated as a monthly rate
75.11applicable annual rate or rates specified in section 356.59, subdivision 5, from the date due
75.12until the date payment is received in the office of the association, compounded annually,
75.13with a minimum interest charge of $10. If the shortage payment and interest is not paid by
75.14the employing unit within 60 days of notification, the executive director shall certify the
75.15amount of the shortage payment and interest to the commissioner of management and budget,
75.16who shall deduct the amount from any state aid or appropriation amount applicable to the
75.17employing unit.
75.18EFFECTIVE DATE.This section is effective July 1, 2017.

75.19    Sec. 33. Minnesota Statutes 2016, section 354A.12, subdivision 7, is amended to read:
75.20    Subd. 7. Recovery of benefit overpayments. (a) If the executive director discovers,
75.21within the time period specified in subdivision 8 following the payment of a refund or the
75.22accrual date of any retirement annuity, survivor benefit, or disability benefit, that benefit
75.23overpayment has occurred due to using invalid service or salary, or due to any erroneous
75.24calculation procedure, the executive director must recalculate the annuity or benefit payable
75.25and recover any overpayment. The executive director shall recover the overpayment by
75.26requiring direct repayment or by suspending or reducing the payment of a retirement annuity
75.27or other benefit payable under this chapter to the applicable person or the person's estate,
75.28whichever applies, until all outstanding amounts have been recovered. If a benefit
75.29overpayment or improper payment of benefits occurred caused by a failure of the person
75.30to satisfy length of separation requirements for retirement under section 354A.011,
75.31subdivision 21 , the executive director shall recover the improper payments by requiring
75.32direct repayment. The repayment must include interest at the rate of 0.71 percent per month
75.33applicable annual rate or rates specified in section 356.59, subdivision 5, from the first of
76.1the month in which a monthly benefit amount was paid to the first of the month in which
76.2the amount is repaid, with annual compounding.
76.3(b) In the event the executive director determines that an overpaid annuity or benefit
76.4that is the result of invalid salary included in the average salary used to calculate the payment
76.5amount must be recovered, the executive director must determine the amount of the employee
76.6deductions taken in error on the invalid salary, with interest as determined under 354A.37,
76.7subdivision 3 , and must subtract that amount from the total annuity or benefit overpayment,
76.8and the remaining balance of the overpaid annuity or benefit, if any, must be recovered.
76.9(c) If the invalid employee deductions plus interest exceed the amount of the overpaid
76.10benefits, the balance must be refunded to the person to whom the benefit or annuity is being
76.11paid.
76.12(d) Any invalid employer contributions reported on the invalid salary must be credited
76.13against future contributions payable by the employer.
76.14(e) If a member or former member, who is receiving a retirement annuity or disability
76.15benefit for which an overpayment is being recovered, dies before recovery of the overpayment
76.16is completed and an optional annuity or refund is payable, the remaining balance of the
76.17overpaid annuity or benefit must continue to be recovered from the payment to the optional
76.18annuity beneficiary or refund recipient.
76.19(f) The board of trustees shall adopt policies directing the period of time and manner
76.20for the collection of any overpaid retirement or optional annuity, and survivor or disability
76.21benefit, or a refund that the executive director determines must be recovered as provided
76.22under this section.
76.23EFFECTIVE DATE.This section is effective July 1, 2017.

76.24    Sec. 34. Minnesota Statutes 2016, section 354A.34, is amended to read:
76.25354A.34 DISPOSITION OF UNPAID PERIOD CERTAIN FOR LIFE OR
76.26GUARANTEED REFUND OPTIONAL ANNUITIES.
76.27If a retiree from a coordinated program who has elected a period certain and for life
76.28thereafter or a guaranteed refund optional annuity form dies without having a designated
76.29beneficiary who has survived the retiree, any remaining unpaid guaranteed annuity payments
76.30shall be computed at the rate of interest specified in section 356.215, subdivision 8, and
76.31paid in one lump sum to the estate of the retiree. If a retiree from a coordinated program
76.32who has elected a period certain and for life or a guaranteed refund optional annuity form
76.33dies with a designated beneficiary who has survived the retiree but the designated beneficiary
77.1dies without there existing another designated beneficiary, any remaining unpaid guaranteed
77.2annuity payments shall be computed at the rate of with interest at the applicable annual rate
77.3or rates specified in section 356.215, subdivision 8 356.59, subdivision 5, and paid in one
77.4lump sum to the estate of the designated beneficiary.
77.5EFFECTIVE DATE.This section is effective July 1, 2017.

77.6    Sec. 35. Minnesota Statutes 2016, section 354A.38, subdivision 3, is amended to read:
77.7    Subd. 3. Computation of refund repayment amount. If the coordinated member elects
77.8to repay a refund under subdivision 2, the repayment to the fund must be in an amount equal
77.9to refunds the member has accepted plus interest at the rate of 8.5 percent until June 30,
77.102015, and eight percent thereafter applicable annual rate or rates specified in section 356.59,
77.11subdivision 5, compounded annually, from the date that the refund was accepted to the date
77.12that the refund is repaid.
77.13EFFECTIVE DATE.This section is effective July 1, 2017.

77.14    Sec. 36. Minnesota Statutes 2016, section 356.195, subdivision 2, is amended to read:
77.15    Subd. 2. Purchase procedure for strike periods. (a) An employee covered by a plan
77.16specified in subdivision 1 may purchase allowable service credit in the applicable plan for
77.17any period of time during which the employee was on a public employee strike without
77.18pay, not to exceed a period of one year, if the employee makes a payment in lieu of salary
77.19deductions as specified in paragraph (b) or (c), whichever applies. The employing unit, at
77.20its option, may pay the employer portion of the amount specified in paragraph (b) on behalf
77.21of its employees.
77.22(b) If payment is received by the applicable pension plan executive director within one
77.23year from the end of the strike, the payment amount is equal to the applicable employee
77.24and employer contribution rates specified in law for the applicable plan during the strike
77.25period, applied to the employee's rate of salary in effect at the conclusion of the strike for
77.26the period of the strike without pay, plus compound interest at the monthly rate of 0.71
77.27percent for any period for the Teachers Retirement Association and at the monthly rate of
77.280.71 percent until June 30, 2015, and 0.667 percent thereafter for any other retirement plan
77.29listed in section 356.30, subdivision 3 applicable monthly rate or rates specified in section
77.30356.59, subdivisions 2, 3, 4, or 5, whichever applies, from the last day of the strike period
77.31until the date payment is received.
78.1(c) If payment is received by the applicable pension fund director after one year and
78.2before five years from the end of the strike, the payment amount is the amount determined
78.3under section 356.551.
78.4(d) Payments may not be made more than five years after the end of the strike.
78.5EFFECTIVE DATE.This section is effective July 1, 2017.

78.6    Sec. 37. Minnesota Statutes 2016, section 356.44, is amended to read:
78.7356.44 PARTIAL PAYMENT OF PENSION PLAN REFUND.
78.8(a) Notwithstanding any provision of law to the contrary, a member of a pension plan
78.9listed in section 356.30, subdivision 3, with at least two years of forfeited service taken
78.10from a single pension plan, may repay a portion of all refunds. A partial refund repayment
78.11must comply with this section.
78.12(b) The minimum portion of a refund repayment is one-third of the total service credit
78.13period of all refunds taken from a single plan.
78.14(c) The cost of the partial refund repayment is the product of the cost of the total
78.15repayment multiplied by the ratio of the restored service credit to the total forfeited service
78.16credit. The total repayment amount includes interest at the annual rate of 8.5 percent for
78.17any period for the Teachers Retirement Association and is 8.5 percent until June 30, 2015,
78.18and eight percent thereafter for any other retirement plan listed in section 356.30, subdivision
78.193 at the applicable annual rate or rates specified in section 356.59, subdivisions 2, 3, 4, or
78.205, whichever applies, compounded annually, from the refund date to the date repayment is
78.21received.
78.22(d) The restored service credit must be allocated based on the relationship the restored
78.23service bears to the total service credit period for all refunds taken from a single pension
78.24plan.
78.25(e) This section does not authorize a public pension plan member to repay a refund if
78.26the law governing the plan does not authorize the repayment of a refund of member
78.27contributions.
78.28EFFECTIVE DATE.This section is effective July 1, 2017.

78.29    Sec. 38. Minnesota Statutes 2016, section 356.50, subdivision 2, is amended to read:
78.30    Subd. 2. Service credit procedure. (a) To obtain the public pension plan allowable
78.31service credit, the eligible person under subdivision 1 shall pay the required member
79.1contribution amount. The required member contribution amount is the member contribution
79.2rate or rates in effect for the pension plan during the period of service covered by the back
79.3pay award, applied to the unpaid gross salary amounts of the back pay award including
79.4unemployment insurance, workers' compensation, or wages from other sources which
79.5reduced the back award. No contributions may be made under this clause for compensation
79.6covered by a public pension plan listed in section 356.30, subdivision 3, for employment
79.7during the removal period. The person shall pay the required member contribution amount
79.8within 60 days of the date of receipt of the back pay award or within 60 days of a billing
79.9from the retirement fund, whichever is later.
79.10(b) The public employer who wrongfully discharged the public employee must pay an
79.11employer contribution on the back pay award. The employer contribution must be based
79.12on the employer contribution rate or rates in effect for the pension plan during the period
79.13of service covered by the back pay award, applied to the salary amount on which the member
79.14contribution amount was determined under paragraph (a). Interest on both the required
79.15member and employer contribution amount must be paid by the employer at the annual
79.16compound rate of 8.5 percent for any period for the Teachers Retirement Association and
79.178.5 percent until June 30, 2015, and eight percent thereafter, for any other retirement plan
79.18listed in section 356.30, subdivision 3, per year, expressed monthly The employer must pay
79.19compound interest on both the required member and employer contribution amounts at the
79.20applicable monthly rate or rates specified in section 356.59, subdivisions 2, 3, 4, or 5,
79.21whichever applies, between the date the contribution amount would have been paid to the
79.22date of actual payment. The employer payment must be made within 30 days of the payment
79.23under paragraph (a).
79.24EFFECTIVE DATE.This section is effective July 1, 2017.

79.25    Sec. 39. Minnesota Statutes 2016, section 356.551, subdivision 2, is amended to read:
79.26    Subd. 2. Determination. (a) Unless the minimum purchase amount set forth in paragraph
79.27(c) applies, the prior service credit purchase amount is an amount equal to the actuarial
79.28present value, on the date of payment, as calculated by the chief administrative officer of
79.29the pension plan and reviewed by the actuary retained under section 356.214, of the amount
79.30of the additional retirement annuity obtained by the acquisition of the additional service
79.31credit in this section.
79.32    (b) Calculation of this amount must be made using the preretirement interest rate
79.33applicable to the public pension plan specified in section 356.215, subdivision 8, and the
79.34mortality table adopted for the public pension plan. The calculation must assume continuous
80.1future service in the public pension plan until, and retirement at, the age at which the
80.2minimum requirements of the fund for normal retirement or retirement with an annuity
80.3unreduced for retirement at an early age, including section 356.30, are met with the additional
80.4service credit purchased. The calculation must also assume a full-time equivalent salary, or
80.5actual salary, whichever is greater, and a future salary history that includes annual salary
80.6increases at the applicable salary increase rate for the plan specified in section 356.215,
80.7subdivision 4d 8.
80.8    (c) The prior service credit purchase amount may not be less than the amount determined
80.9by applying, for each year or fraction of a year being purchased, the sum of the employee
80.10contribution rate, the employer contribution rate, and the additional employer contribution
80.11rate, if any, applicable during that period, to the person's annual salary during that period,
80.12or fractional portion of a year's salary, if applicable, plus interest at the annual rate of 8.5
80.13percent until June 30, 2015, and eight percent thereafter applicable annual rate or rates
80.14specified in section 356.59, subdivisions 2, 3, 4, or 5, whichever applies, compounded
80.15annually, from the end of the year in which contributions would otherwise have been made
80.16to the date on which the payment is received.
80.17    (d) Unless otherwise provided by statutes governing a specific plan, payment must be
80.18made in one lump sum within one year of the prior service credit authorization or prior to
80.19the member's effective date of retirement, whichever is earlier. Payment of the amount
80.20calculated under this section must be made by the applicable eligible person.
80.21    (e) However, the current employer or the prior employer may, at its discretion, pay all
80.22or any portion of the payment amount that exceeds an amount equal to the employee
80.23contribution rates in effect during the period or periods of prior service applied to the actual
80.24salary rates in effect during the period or periods of prior service, plus interest at the
80.25applicable annual rate of 8.5 percent a year or rates specified in section 356.59, subdivisions
80.262, 3, 4, or 5, whichever applies, compounded annually, from the date on which the
80.27contributions would otherwise have been made to the date on which the payment is made.
80.28If the employer agrees to payments under this subdivision, the purchaser must make the
80.29employee payments required under this subdivision within 90 days of the prior service credit
80.30authorization. If that employee payment is made, the employer payment under this
80.31subdivision must be remitted to the chief administrative officer of the public pension plan
80.32within 60 days of receipt by the chief administrative officer of the employee payments
80.33specified under this subdivision.
80.34EFFECTIVE DATE.This section is effective July 1, 2017.

81.1    Sec. 40. [356.59] INTEREST RATES.
81.2    Subdivision 1. Applicable interest rates. Whenever the payment of interest is required
81.3with respect to any payment, including refunds, remittances, shortages, contributions, or
81.4repayments, the rate of interest is the rate or rates specified in subdivisions 2 to 5 for each
81.5public retirement plan.
81.6    Subd. 2. Minnesota State Retirement System. The interest rates for all retirement plans
81.7administered by the Minnesota State Retirement System are as follows:

81.8				Annual		Monthly
81.9		before July 1, 2015	8.5 percent		0.71 percent
81.10		from July 1, 2015, to June 30, 2017	8.0 percent		0.667 percent
81.11		after June 30, 2017	7.5 percent		0.625 percent

81.12    Subd. 3. Public Employees Retirement Association. The interest rates for all retirement
81.13plans administered by the Public Employees Retirement Association are as follows:

81.14		before July 1, 2015	8.5 percent
81.15		from July 1, 2015, to June 30, 2017	8.0 percent
81.16		after June 30, 2017	7.5 percent

81.17    Subd. 4. Teachers Retirement Association. The interest rates for the retirement plan
81.18administered by the Teachers Retirement Association are as follows:

81.19				Annual		Monthly
81.20		before July 1, 2017	8.5 percent		0.71 percent
81.21		after June 30, 2017	7.5 percent		0.625 percent

81.22    Subd. 5. St. Paul Teachers Retirement Fund Association. The interest rates for the
81.23retirement plan administered by the St. Paul Teachers Retirement Fund Association are as
81.24follows:

81.25				Annual		Monthly
81.26		before July 1, 2015	8.5 percent		0.71 percent
81.27		from July 1, 2015, to June 30, 2017	8.0 percent		0.667 percent
81.28		after June 30, 2017	7.5 percent		0.625 percent

81.29EFFECTIVE DATE.This section is effective July 1, 2017.

81.30    Sec. 41. Minnesota Statutes 2016, section 490.121, subdivision 4, is amended to read:
81.31    Subd. 4. Allowable service. (a) "Allowable service" means any calendar month, subject
81.32to the service credit limit in subdivision 22, served as a judge at any time, during which the
81.33judge received compensation for that service from the state, municipality, or county,
82.1whichever applies, and for which the judge made any required member contribution. It also
82.2includes any month served as a referee in probate for all referees in probate who were in
82.3office before January 1, 1974.
82.4(b) "Allowable service" also means a period of authorized leave of absence for which
82.5the judge has made a payment in lieu of contributions, not in an amount in excess of the
82.6service credit limit under subdivision 22. To obtain the service credit, the judge shall pay
82.7an amount equal to the normal cost of the judges retirement plan on the date of return from
82.8the leave of absence, as determined in the most recent actuarial report for the plan filed with
82.9the Legislative Commission on Pensions and Retirement, multiplied by the judge's average
82.10monthly salary rate during the authorized leave of absence and multiplied by the number
82.11of months of the authorized leave of absence, plus annual compound interest at the rate of
82.128.5 percent until June 30, 2015, and eight percent thereafter interest at the applicable annual
82.13rate or rates specified in section 356.59, subdivision 2, compounded annually, from the date
82.14of the termination of the leave to the date on which payment is made. The payment must
82.15be made within one year of the date on which the authorized leave of absence terminated.
82.16Service credit for an authorized leave of absence is in addition to a uniformed service leave
82.17under section 490.1211.
82.18(c) "Allowable service" does not mean service as a retired judge.
82.19EFFECTIVE DATE.This section is effective July 1, 2017.

82.20    Sec. 42. Minnesota Statutes 2016, section 490.1211, is amended to read:
82.21490.1211 UNIFORMED SERVICE.
82.22(a) A judge who is absent from employment by reason of service in the uniformed
82.23services, as defined in United States Code, title 38, section 4303(13), and who returns to
82.24state employment as a judge upon discharge from service in the uniformed service within
82.25the time frame required in United States Code, title 38, section 4312(e), may obtain service
82.26credit for the period of the uniformed service, provided that the judge did not separate from
82.27uniformed service with a dishonorable or bad conduct discharge or under other than honorable
82.28conditions.
82.29(b) The judge may obtain credit by paying into the fund equivalent member contribution
82.30based on the contribution rate or rates in effect at the time that the uniformed service was
82.31performed multiplied by the full and fractional years being purchased and applied to the
82.32annual salary rate. The annual salary rate is the average annual salary during the purchase
82.33period that the judge would have received if the judge had continued to provide employment
83.1services to the state rather than to provide uniformed service, or if the determination of that
83.2rate is not reasonably certain, the annual salary rate is the judge's average salary rate during
83.3the 12-month period of judicial employment rendered immediately preceding the purchase
83.4period.
83.5(c) The equivalent employer contribution and, if applicable, the equivalent employer
83.6additional contribution, must be paid by the employing unit, using the employer and employer
83.7additional contribution rate or rates in effect at the time that the uniformed service was
83.8performed, applied to the same annual salary rate or rates used to compute the equivalent
83.9member contribution.
83.10(d) If the member equivalent contributions provided for in this section are not paid in
83.11full, the judge's allowable service credit must be prorated by multiplying the full and
83.12fractional number of years of uniformed service eligible for purchase by the ratio obtained
83.13by dividing the total member contributions received by the total member contributions
83.14otherwise required under this section.
83.15(e) To receive allowable service credit under this section, the contributions specified in
83.16this section and section 490.121 must be transmitted to the fund during the period which
83.17begins with the date on which the individual returns to judicial employment and which has
83.18a duration of three times the length of the uniformed service period, but not to exceed five
83.19years. If the determined payment period is calculated to be less than one year, the
83.20contributions required under this section to receive service credit may be within one year
83.21from the discharge date.
83.22(f) The amount of allowable service credit obtainable under this section and section
83.23490.121 may not exceed five years, unless a longer purchase period is required under United
83.24States Code, title 38, section 4312.
83.25(g) The state court administrator shall pay interest on all equivalent member and employer
83.26contribution amounts payable under this section. Interest must be computed at the rate of
83.278.5 percent until June 30, 2015, and eight percent thereafter at the applicable annual rate or
83.28rates specified in section 356.59, subdivision 2, compounded annually, from the end of each
83.29fiscal year of the leave or break in service to the end of the month in which payment is
83.30received.
83.31EFFECTIVE DATE.This section is effective July 1, 2017.

84.1    Sec. 43. Minnesota Statutes 2016, section 490.124, subdivision 12, is amended to read:
84.2    Subd. 12. Refund. (a) A person who ceases to be a judge is entitled to a refund in an
84.3amount that is equal to all of the member's employee contributions to the judges' retirement
84.4fund plus interest computed under section 352.22, subdivision 2.
84.5    (b) A refund of contributions under paragraph (a) terminates all service credits and all
84.6rights and benefits of the judge and the judge's survivors under this chapter.
84.7    (c) A person who becomes a judge again after taking a refund under paragraph (a) may
84.8reinstate the previously terminated allowable service credit, rights, and benefits by repaying
84.9the total amount of the previously received refund. The refund repayment must include
84.10interest on the total amount previously received at the annual rate of 8.5 percent until June
84.1130, 2015, and eight percent thereafter at the applicable annual rate or rates specified in
84.12section 356.59, subdivision 2, compounded annually, from the date on which the refund
84.13was received until the date on which the refund is repaid.
84.14EFFECTIVE DATE.This section is effective July 1, 2017.


84.17    Section 1. Minnesota Statutes 2016, section 352.04, subdivision 2, is amended to read:
84.18    Subd. 2. Employee contributions. (a) The employee contribution to the fund must be
84.19equal to the following percent of salary:

84.20		from July 1, 2010, to June 30, 2014	5
84.21		from July 1, 2014, and thereafter to June 30, 2017	5.5
84.22		from July 1, 2017, to June 30, 2018	5.75
84.23		after June 30, 2018	6

84.24(b) These contributions must be made by deduction from salary as provided in subdivision
84.254.
84.26(c) Contribution increases under paragraph (a) must be paid starting the first day of the
84.27first full pay period after the effective date of the increase.
84.28EFFECTIVE DATE.This section is effective July 1, 2017.

84.29    Sec. 2. Minnesota Statutes 2016, section 352.04, subdivision 3, is amended to read:
84.30    Subd. 3. Employer contributions. (a) The employer contribution to the fund must be
84.31equal to the following percent of salary:

85.1		from July 1, 2010, to June 30, 2014	5
85.2		from July 1, 2014, and thereafter to June 30, 2017	5.5
85.3		from July 1, 2017, to June 30, 2018	5.875
85.4		after June 30, 2018	6.25

85.5(b) Contribution increases under paragraph (a) must be paid starting the first day of the
85.6first full pay period after the effective date of the increase.
85.7EFFECTIVE DATE.This section is effective July 1, 2017.

85.8    Sec. 3. Minnesota Statutes 2016, section 352.92, subdivision 1, is amended to read:
85.9    Subdivision 1. Employee contributions. (a) Employee contributions of covered
85.10correctional employees must be in an amount equal to the following percent of salary:

85.11		from July 1, 2010, to June 30, 2014	8.6
85.12		from July 1, 2014, and thereafter to June 30, 2017	9.1
85.13		after June 30, 2017	9.6

85.14(b) These contributions must be made by deduction from salary as provided in section
85.15352.04, subdivision 4 .
85.16(c) Contribution increases under paragraph (a) must be paid starting the first day of the
85.17first full pay period after the effective date of the increase.
85.18EFFECTIVE DATE.This section is effective July 1, 2017.

85.19    Sec. 4. Minnesota Statutes 2016, section 352.92, subdivision 2, is amended to read:
85.20    Subd. 2. Employer contributions. (a) The employer shall contribute for covered
85.21correctional employees an amount equal to the following percent of salary:

85.22		from July 1, 2010, to June 30, 2014	12.1
85.23		from July 1, 2014, and thereafter to June 30, 2017	12.85
85.24		after June 30, 2017	14.4

85.25(b) Contribution increases under paragraph (a) must be paid starting the first day of the
85.26first full pay period after the effective date of the increase.
85.27EFFECTIVE DATE.This section is effective July 1, 2017.

86.1    Sec. 5. Minnesota Statutes 2016, section 352.92, is amended by adding a subdivision to
86.2read:
86.3    Subd. 2a. Supplemental employer contribution. (a) Effective July 1, 2018, the employer
86.4shall pay a supplemental contribution. The supplemental contribution shall be 1.45 percent
86.5of salary for covered correctional employees from July 1, 2018, through June 30, 2019;
86.62.95 percent of salary for covered correctional employees from July 1, 2019, through June
86.730, 2020; and 4.45 percent of salary for covered correctional employees thereafter. The
86.8supplemental contribution rate of 4.45 percent shall remain in effect until the market value
86.9of the assets of the correctional state employees retirement plan of the Minnesota State
86.10Retirement System equals or exceeds the actuarial accrued liability of the plan as determined
86.11by the actuary retained under section 356.214. The expiration of the supplemental employer
86.12contribution is effective the first day of the first full pay period of the fiscal year immediately
86.13following the issuance of the actuarial valuation upon which the expiration is based.
86.14(b) The supplemental contribution under paragraph (a) must be paid starting the first
86.15day of the first full pay period after the effective date.
86.16EFFECTIVE DATE.This section is effective July 1, 2017.

86.17    Sec. 6. Minnesota Statutes 2016, section 352B.02, subdivision 1a, is amended to read:
86.18    Subd. 1a. Member contributions. (a) The member contribution is the following
86.19percentage of the member's salary:

86.20 86.21		(1) before the first day of the first pay period beginning after July 1, 2014	12.4 percent
86.22 86.23		(2) on or after the first day of the first pay period beginning after from July 1, 2014, to June 30, 2016	13.4 percent
86.24 86.25		(3) after June 30, 2016 from July 1, 2016, to June 30, 2017	14.4 percent
86.26		from July 1, 2017, to June 30, 2019	14.9
86.27		after June 30, 2019	15.4

86.28(b) These contributions must be made by deduction from salary as provided in section
86.29352.04, subdivision 4 .
86.30(c) Contribution increases under paragraph (a) must be paid starting the first day of the
86.31first full pay period after the effective date of the increase.
86.32EFFECTIVE DATE.This section is effective July 1, 2017.

87.1    Sec. 7. Minnesota Statutes 2016, section 352B.02, subdivision 1c, is amended to read:
87.2    Subd. 1c. Employer contributions and supplemental employer contribution. (a) In
87.3addition to member contributions, department heads shall pay a sum equal to the specified
87.4percentage of the salary upon which deductions were made, which constitutes the employer
87.5contribution to the fund as follows:

87.6 87.7		(1) before the first day of the first pay period beginning after July 1, 2014	18.6 percent
87.8 87.9		(2) on or after the first day of the first pay period beginning after from July 1, 2014, to June 30, 2016	20.1 percent
87.10 87.11		(3) after June 30, 2016 from July 1, 2016, to June 30, 2017	21.6 percent
87.12		from July 1, 2017, to June 30, 2018	22.35
87.13		after June 30, 2018	23.1

87.14(b) Department contributions must be paid out of money appropriated to departments
87.15for this purpose.
87.16(c) Contribution increases under paragraph (a) must be paid starting the first day of the
87.17first full pay period after the effective date of the increase.
87.18(d) Effective July 1, 2017, department heads shall pay a supplemental employer
87.19contribution. The supplemental contribution shall be 1.75 percent of the salary upon which
87.20deductions are made from July 1, 2017, through June 30, 2018; three percent of the salary
87.21upon which deductions are made from July 1, 2018, through June 30, 2019; five percent of
87.22the salary which deductions are made from July 1, 2019, through June 30, 2020; and seven
87.23percent of the salary upon which deductions are made thereafter. The supplemental
87.24contribution must be paid starting the first day of the first full pay period after the effective
87.25date. The supplemental contribution rate of seven percent shall remain in effect until the
87.26market value of the assets of the State Patrol retirement plan of the Minnesota State
87.27Retirement System equals or exceeds the actuarial accrued liability of the plan as determined
87.28by the actuary retained under section 356.214. The expiration of the supplemental employer
87.29contribution is effective the first day of the first full pay period of the fiscal year immediately
87.30following the issuance of the actuarial valuation upon which the expiration is based.
87.31EFFECTIVE DATE.This section is effective July 1, 2017.

87.32    Sec. 8. Minnesota Statutes 2016, section 352D.04, subdivision 2, is amended to read:
87.33    Subd. 2. Contribution rates. (a) The money used to purchase shares under this section
87.34is the employee and employer contributions provided in this subdivision.
88.1    (b) The employee contribution is an amount equal to the 5.5 percent of salary specified
88.2in section 352.04, subdivision 2, or 352.045, subdivision 3a.
88.3    (c) The employer contribution is an amount equal to six percent of salary.
88.4    (d) For members of the legislature, the contributions under this subdivision also must
88.5be made on per diem payments received during a regular or special legislative session, but
88.6may not be made on per diem payments received outside of a regular or special legislative
88.7session, on the additional compensation attributable to a leadership position under section
88.83.099 , subdivision 3, living expense payments under section 3.101, or special session living
88.9expense payments under section 3.103.
88.10    (e) For a judge who is a member of the unclassified plan under section 352D.02,
88.11subdivision 1, paragraph (c), clause (16), the employee contribution rate is eight percent of
88.12salary, and there is no employer contribution.
88.13(f) These contributions must be made in the manner provided in section 352.04,
88.14subdivisions 4, 5, and 6.
88.15EFFECTIVE DATE.This section is effective July 1, 2017.

88.16    Sec. 9. Minnesota Statutes 2016, section 353.65, subdivision 2, is amended to read:
88.17    Subd. 2. Employee contribution. (a) For members other than members who were active
88.18members of the former Minneapolis Firefighters Relief Association on December 29, 2011,
88.19or for members other than members who were active members of the former Minneapolis
88.20Police Relief Association on December 29, 2011, the employee contribution is an amount
88.21equal to the following percentage of the total salary of each member, as follows: 9.6 percent
88.22before calendar year 2014; 10.2 percent in calendar year 2014; and 10.8 percent in calendar
88.23year 2015 and thereafter.

88.24		before January 1, 2018	10.8 percent
88.25		from January 1, 2018, through December 31, 2018	11.3 percent
88.26		from January 1, 2019, and thereafter	11.8 percent

88.27(b) For members who were active members of the former Minneapolis Firefighters Relief
88.28Association on December 29, 2011, the employee contribution is an amount equal to eight
88.29percent of the monthly unit value under section 353.01, subdivision 10a, multiplied by 80
88.30and expressed as a biweekly amount for each member. The employee contribution made
88.31by a member with at least 25 years of service credit as an active member of the former
88.32Minneapolis Firefighters Relief Association must be deposited in the postretirement health
88.33care savings account established under section 352.98.
89.1(c) For members who were active members of the former Minneapolis Police Relief
89.2Association on December 29, 2011, the employee contribution is an amount equal to eight
89.3percent of the monthly unit value under section 353.01, subdivision 10b, multiplied by 80
89.4and expressed as a biweekly amount for each member. The employee contribution made
89.5by a member with at least 25 years of service credit as an active member of the former
89.6Minneapolis Police Relief Association must be deposited in the postretirement health care
89.7savings account established under section 352.98.
89.8(d) Contributions under this section must be made by deduction from salary in the manner
89.9provided in subdivision 4. Where any portion of a member's salary is paid from other than
89.10public funds, the member's employee contribution is based on the total salary received from
89.11all sources.
89.12EFFECTIVE DATE.This section is effective July 1, 2017.

89.13    Sec. 10. Minnesota Statutes 2016, section 353.65, subdivision 3, is amended to read:
89.14    Subd. 3. Employer contribution. (a) With respect to members other than members who
89.15were active members of the former Minneapolis Firefighters Relief Association on December
89.1629, 2011, or for members other than members who were active members of the former
89.17Minneapolis Police Relief Association on December 29, 2011, the employer contribution
89.18is an amount equal to the following percentage of the total salary of each member, as follows:
89.1914.4 percent before calendar year 2014; 15.3 percent in calendar year 2014; and 16.2 percent
89.20in calendar year 2015 and thereafter.

89.21		before January 1, 2018	16.2 percent
89.22		from January 1, 2018, through December 31, 2018	16.95 percent
89.23		from January 1, 2019, and thereafter	17.7 percent

89.24(b) With respect to members who were active members of the former Minneapolis
89.25Firefighters Relief Association on December 29, 2011, the employer contribution is an
89.26amount equal to the amount of the member contributions under subdivision 2, paragraph
89.27(b).
89.28(c) With respect to members who were active members of the former Minneapolis Police
89.29Relief Association on December 29, 2011, the employer contribution is an amount equal
89.30to the amount of the member contributions under subdivision 2, paragraph (c).
89.31(d) Contributions under this subdivision must be made from funds available to the
89.32employing subdivision by the means and in the manner provided in section 353.28.
89.33EFFECTIVE DATE.This section is effective July 1, 2017.

90.1    Sec. 11. Minnesota Statutes 2016, section 354.42, subdivision 2, is amended to read:
90.2    Subd. 2. Employee contribution. (a) The employee contribution to the fund is the
90.3following percentage of the member's salary:

90.4		Period	Basic Program	Coordinated Program
90.5		from July 1, 2013, until June 30, 2014	10.5 percent	7 percent
90.6 90.7		after June 30, 2014 from July 1, 2014, through June 30, 2017	11 percent	7.5 percent
90.8		from July 1, 2017, through June 30, 2018	11.19 percent	7.69 percent
90.9		from July 1, 2018, through June 30, 2019	11.38 percent	7.88 percent
90.10		from July 1, 2019, through June 30, 2020	11.56 percent	8.06 percent
90.11		after June 30, 2020	11.75 percent	8.25 percent

90.12(b) When an employee contribution rate changes for a fiscal year, the new contribution
90.13rate is effective for the entire salary paid for each employer unit with the first payroll cycle
90.14reported.
90.15(c) After June 30, 2015, if a contribution rate revision is required under subdivisions 4a,
90.164b, and 4c, the employee contributions under paragraphs (a) and (b) must be adjusted
90.17accordingly.
90.18(d) This contribution must be made by deduction from salary. Where any portion of a
90.19member's salary is paid from other than public funds, the member's employee contribution
90.20must be based on the entire salary received.
90.21EFFECTIVE DATE.This section is effective July 1, 2017.

90.22    Sec. 12. Minnesota Statutes 2016, section 354.42, subdivision 3, is amended to read:
90.23    Subd. 3. Employer. (a) The regular employer contribution to the fund by Special School
90.24District No. 1, Minneapolis, is an amount equal to the applicable following percentage of
90.25salary of each coordinated member and the applicable percentage of salary of each basic
90.26member specified in paragraph (c).
90.27The additional employer contribution to the fund by Special School District No. 1,
90.28Minneapolis, is an amount equal to 3.64 percent of the salary of each teacher who is a
90.29coordinated member or who is a basic member.
90.30(b) The regular employer contribution to the fund by Independent School District No.
90.31709, Duluth, is an amount equal to the applicable percentage of salary of each old law or
90.32new law coordinated member specified for the coordinated program in paragraph (c).
91.1(c) The employer contribution to the fund for every other employer is an amount equal
91.2to the applicable following percentage of the salary of each coordinated member and the
91.3applicable following percentage of the salary of each basic member:

91.4		Period	Coordinated Member			Basic Member
91.5		from July 1, 2013, until June 30, 2014		7 percent		11 percent
91.6 91.7		after June 30, 2014 from July 1, 2014, through June 30, 2017		7.5 percent		11.5 percent
91.8		from July 1, 2017, through June 30, 2018		7.75 percent		11.75 percent
91.9		from July 1, 2018, through June 30, 2019		8.0 percent		12 percent
91.10		from July 1, 2019, through June 30, 2020		8.25 percent		12.25 percent
91.11		after June 30, 2020		8.5 percent		12.5 percent

91.12(d) When an employer contribution rate changes for a fiscal year, the new contribution
91.13rate is effective for the entire salary paid for each employer unit with the first payroll cycle
91.14reported.
91.15(e) After June 30, 2015, if a contribution rate revision is made under subdivisions 4a,
91.164b, and 4c, the employer contributions under paragraphs (a), (b), and (c) must be adjusted
91.17accordingly.
91.18EFFECTIVE DATE.This section is effective the day following final enactment.

91.19    Sec. 13. Minnesota Statutes 2016, section 354A.12, subdivision 1, is amended to read:
91.20    Subdivision 1. Employee contributions. (a) The contribution required to be paid by
91.21each member of the St. Paul Teachers Retirement Fund Association is the percentage of
91.22total salary specified below for the applicable association and program:

91.23		Program	Percentage of Total Salary
91.24	St. Paul Teachers Retirement Fund Association
91.25		basic program after June 30, 2014	9 percent
91.26		basic program after June 30, 2015	9.5 percent
91.27		basic program after June 30, 2016	10 percent
91.28		basic program after June 30, 2021	10.25 percent
91.29		coordinated program after June 30, 2014	6.5 percent
91.30		coordinated program after June 30, 2015	7 percent
91.31		coordinated program after June 30, 2016	7.5 percent
91.32		coordinated program after June 30, 2021	7.75 percent

91.33(b) Contributions must be made by deduction from salary and must be remitted directly
91.34to the St. Paul Teachers Retirement Fund Association at least once each month.
92.1(c) When an employee contribution rate changes for a fiscal year, the new contribution
92.2rate is effective for the entire salary paid by the employer with the first payroll cycle reported.
92.3EFFECTIVE DATE.This section is effective July 1, 2017.

92.4    Sec. 14. Minnesota Statutes 2016, section 354A.12, subdivision 2a, is amended to read:
92.5    Subd. 2a. Employer regular and additional contributions. (a) The employing units
92.6shall make the following employer contributions to the teachers retirement fund association:
92.7(1) for any each coordinated member of the St. Paul Teachers Retirement Fund
92.8Association, the employing unit shall make a regular employer contribution to the retirement
92.9fund association in an amount equal to the designated percentage of the salary of the
92.10coordinated member as provided below:

92.11		after June 30, 2014	5.5 percent
92.12		after June 30, 2015	6 percent
92.13		after June 30, 2016	6.25 percent
92.14		after June 30, 2017	6.5 7 percent
92.15		after June 30, 2018	7.75 percent
92.16		after June 30, 2019	8.25 percent
92.17		after June 30, 2020	9 percent

92.18(2) for any each basic member of the St. Paul Teachers Retirement Fund Association,
92.19the employing unit shall make a regular employer contribution to the respective retirement
92.20fund in an amount according to the schedule below:

92.21		after June 30, 2014	9 percent of salary
92.22		after June 30, 2015	9.5 percent of salary
92.23		after June 30, 2016	9.75 percent of salary
92.24		after June 30, 2017	10 10.5 percent of salary
92.25		after June 30, 2018	11.25 percent of salary
92.26		after June 30, 2019	11.75 percent of salary
92.27		after June 30, 2020	12.5 percent of salary

92.28(3) for a each basic member of the St. Paul Teachers Retirement Fund Association, the
92.29employing unit shall make an additional employer contribution to the respective fund in an
92.30amount equal to 3.64 percent of the salary of the basic member;
92.31(4) for a each coordinated member of the St. Paul Teachers Retirement Fund Association,
92.32the employing unit shall make an additional employer contribution to the respective fund
92.33in an amount equal to 3.84 percent of the coordinated member's salary.
93.1(b) The regular and additional employer contributions must be remitted directly to the
93.2St. Paul Teachers Retirement Fund Association at least once each month. Delinquent amounts
93.3are payable with interest under the procedure in subdivision 1a.
93.4(c) Payments of regular and additional employer contributions for school district or
93.5technical college employees who are paid from normal operating funds must be made from
93.6the appropriate fund of the district or technical college.
93.7(d) When an employer contribution rate changes for a fiscal year, the new contribution
93.8rate is effective for the entire salary paid by the employer with the first payroll cycle reported.
93.9EFFECTIVE DATE.This section is effective July 1, 2017.


93.12    Section 1. Minnesota Statutes 2016, section 353.65, is amended by adding a subdivision
93.13to read:
93.14    Subd. 3b. Direct state aid. The state shall pay $4,500,000 on October 1, 2018, and
93.15October 1, 2019, to the public employees police and fire retirement plan. By October 1 of
93.16each year after 2019, the state shall pay to the public employees police and fire retirement
93.17plan $9,000,000.

93.18    Sec. 2. Minnesota Statutes 2016, section 354A.12, subdivision 3a, is amended to read:
93.19    Subd. 3a. Direct state aid to first class city teachers retirement fund associations.
93.20    (a) The state shall pay $2,827,000 to the St. Paul Teachers Retirement Fund Association.
93.21(b) In addition to other amounts specified in this subdivision, the state shall pay
93.22$7,000,000 as state aid to the St. Paul Teachers Retirement Fund Association.
93.23(c) In addition to the amounts specified in paragraphs (a) and (b), the state shall pay
93.24$5,000,000 as state aid to the St. Paul Teachers Retirement Fund Association.
93.25    (c) (d) The aid under this subdivision is payable October 1 annually. The commissioner
93.26of management and budget shall pay the aid specified in this subdivision. The amount
93.27required is appropriated annually from the general fund to the commissioner of management
93.28and budget.
93.29EFFECTIVE DATE.This section is effective July 1, 2017.