S0427A2
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1.1���� .......... moves to amend
S. F. No. 427, the delete
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1.2� everything amendment, as
follows:
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1.3���� Page 167, after line 11,
insert:
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1.4���� "Sec. 3.� Minnesota Statutes 2004, section 69.77,
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1.5� subdivision 4, is amended to
read:
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1.6���� Subd. 4.� RELIEF ASSOCIATION FINANCIAL REQUIREMENTS;
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1.7� MINIMUM MUNICIPAL OBLIGATION. (a) The officers of the relief
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1.8� association shall determine
the financial requirements of the
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1.9� relief association and
minimum obligation of the municipality
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1.10 for the following calendar year in accordance with the
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1.11 requirements of this subdivision.�
The financial requirements of
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1.12 the relief association and the minimum obligation of the
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1.13 municipality must be determined on or before the submission date
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1.14 established by the municipality under subdivision 5.
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1.15��� (b) The financial
requirements of the relief association
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1.16 for the following calendar year must be based on the most recent
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1.17 actuarial valuation or survey of the special fund of the
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1.18 association if more than one fund is maintained by the
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1.19 association, or of the association, if only one fund is
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1.20 maintained, prepared in accordance with sections 356.215,
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1.21 subdivisions 4 to 15, and 356.216, as required under subdivision
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1.22 10.� If an actuarial estimate
is prepared by the actuary of the
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1.23 relief association as part of obtaining a modification of the
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1.24 benefit plan of the relief association and the modification is
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2.1� implemented, the actuarial
estimate must be used in calculating
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2.2� the subsequent financial
requirements of the relief association.
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2.3���� (c) If the relief
association has an unfunded actuarial
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2.4� accrued liability as reported
in the most recent actuarial
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2.5� valuation or survey, the
total of the amounts calculated under
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2.6� clauses (1), (2), and (3),
constitute the financial requirements
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2.7� of the relief association for
the following year.� If the relief
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2.8� association does not have an
unfunded actuarial accrued
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2.9� liability as reported in the
most recent actuarial valuation or
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2.10 survey, the amount calculated under clauses (1) and (2)
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2.11 constitute the financial requirements of the relief association
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2.12 for the following year.� The
financial requirement elements are:
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2.13��� (1) the normal level cost
requirement for the following
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2.14 year, expressed as a dollar amount, which must be determined by
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2.15 applying the normal level cost of the relief association as
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2.16 reported in the actuarial valuation or survey and expressed as a
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2.17 percentage of covered payroll to the estimated covered payroll
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2.18 of the active membership of the relief association, including
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2.19 any projected change in the active membership, for the following
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2.20 year;
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2.21��� (2) for the Bloomington
Fire Department Relief Association,
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2.22 the Fairmont Police Relief Association, and the Virginia Fire
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2.23 Department Relief Association, to the dollar amount of normal
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2.24 cost determined under clause (1) must be added an amount equal
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2.25 to the dollar amount of the administrative expenses of the
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2.26 special fund of the association if more than one fund is
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2.27 maintained by the association, or of the association if only one
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2.28 fund is maintained, for the most recent year, multiplied by the
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2.29 factor of 1.035.� The
administrative expenses are those
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2.30 authorized under section 69.80.�
No amount of administrative
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2.31 expenses under this clause are to be included in the financial
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2.32 requirements of the Minneapolis Firefighters Relief Association
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2.33 or the Minneapolis Police Relief Association; and
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2.34��� (3) to the dollar amount
of normal cost and expenses
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2.35 determined under clauses (1) and (2) must be added an amount
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2.36 equal to the level annual dollar amount which is sufficient to
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3.1� amortize the unfunded
actuarial accrued liability by December
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3.2� 31, 2010, for the
Bloomington Fire Department Relief
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3.3� Association, the Fairmont
Police Relief Association, the
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3.4� Minneapolis Firefighters
Relief Association, and the Virginia
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3.5� Fire Department Relief
Association, and by December 31, 2020,
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3.6� for the Minneapolis Police
Relief Association, as determined
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3.7� from the actuarial valuation
or survey of the fund, using an
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3.8� interest assumption set at
the applicable rate specified in
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3.9� section 356.215, subdivision
8.� The amortization date specified
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3.10 in this clause applies to all local police or salaried
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3.11 firefighters' relief associations and that date supersedes any
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3.12 amortization date specified in any applicable special law.
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3.13��� (d) The minimum obligation
of the municipality is an amount
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3.14 equal to the financial requirements of the relief association
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3.15 reduced by the estimated amount of member contributions from
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3.16 covered salary anticipated for the following calendar year and
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3.17 the estimated amounts anticipated for the following calendar
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3.18 year from the applicable state aid program established under
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3.19 sections 69.011 to 69.051 receivable by the relief association
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3.20 after any allocation made under section 69.031, subdivision 5,
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3.21 paragraph (b), clause (2), or 423A.01, subdivision 2, clause
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3.22 (6), from the local police and salaried firefighters' relief
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3.23 association amortization aid program established under section
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3.24 423A.02, subdivision 1, from the supplementary amortization
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3.25 state‑aid program established under section 423A.02,
subdivision
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3.26 1a, and from the additional amortization state aid under section
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3.27 423A.02, subdivision 1b.
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3.28��� Sec. 4.� Minnesota Statutes 2004, section 356.216, is
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3.29 amended to read:
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3.30��� 356.216 CONTENTS OF
ACTUARIAL VALUATIONS FOR LOCAL POLICE
� 3.31 AND FIRE FUNDS.
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3.32��� (a) The provisions of
section 356.215 that govern the
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3.33 contents of actuarial valuations must apply to any local police
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3.34 or fire pension fund or relief association required to make an
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3.35 actuarial report under this section, except as follows:
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3.36��� (1) in calculating normal
cost and other requirements, if
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4.1� required to be expressed as a
level percentage of covered
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4.2� payroll, the salaries used in
computing covered payroll must be
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4.3� the maximum rate of salary on
which retirement and survivorship
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4.4� credits and amounts of
benefits are determined and from which
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4.5� any member contributions are
calculated and deducted;
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4.6���� (2) in lieu of the
amortization date specified in section
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4.7� 356.215, subdivision 11, the
appropriate amortization target
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4.8� date specified in section
69.77, subdivision 4, or 69.773,
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4.9� subdivision 4, clause (c),
must be used in calculating any
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4.10 required amortization contribution except that the amortization
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4.11 date for the Minneapolis Police Relief Association is December
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4.12 31, 2020;
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4.13��� (3) in addition to the
tabulation of active members and
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4.14 annuitants provided for in section 356.215, subdivision 13, the
��4.15
member contributions for active members for the calendar year
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4.16 and the prospective annual retirement annuities under the
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4.17 benefit plan for active members must be reported;
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4.18��� (4) actuarial valuations
required under section 69.773,
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4.19 subdivision 2, must be made at least every four years and
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4.20 actuarial valuations required under section 69.77 shall be made
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4.21 annually;
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4.22��� (5) the actuarial balance
sheet showing accrued assets
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4.23 valued at market value if the actuarial valuation is required to
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4.24 be prepared at least every four years or valued as current
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4.25 assets under section 356.215, subdivision 1, clause (6), or
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4.26 paragraph (b), whichever applies, if the actuarial valuation is
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4.27 required to be prepared annually, actuarial accrued liabilities,
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4.28 and the unfunded actuarial accrued liability must include the
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4.29 following required reserves:
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4.30��������� (i) For active
members
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4.31������ 1.� Retirement benefits
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4.32������ 2.� Disability benefits
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4.33������ 3.� Refund liability due to death or withdrawal
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4.34������ 4.� Survivors' benefits
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4.35��������� (ii) For deferred
annuitants' benefits
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4.36��������� (iii) For former
members without vested rights
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5.1���������� (iv) For annuitants
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5.2������� 1.� Retirement annuities
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5.3������� 2.� Disability annuities
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5.4������� 3.� Surviving spouses' annuities
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5.5������� 4.� Surviving children's annuities
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5.6���� In addition to those
required reserves, separate items must
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5.7� be shown for additional
benefits, if any, which may not be
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5.8� appropriately included in the
reserves listed above; and
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5.9���� (6) actuarial valuations
are due by the first day of the
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5.10 seventh month after the end of the fiscal year which the
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5.11 actuarial valuation covers.
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5.12��� (b) For the Minneapolis
Firefighters Relief Association or
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5.13 the Minneapolis Police Relief Association, the following
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5.14 provisions additionally apply:
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5.15��� (1) in calculating the
actuarial balance sheet, unfunded
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5.16 actuarial accrued liability, and amortization contribution of
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5.17 the relief association, "current assets" means the value
of all
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5.18 assets at cost, including realized capital gains and losses,
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5.19 plus or minus, whichever applies, the average value of total
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5.20 unrealized capital gains or losses for the most recent
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5.21 three‑year period ending with the end of the plan year
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5.22 immediately preceding the actuarial valuation report
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5.23 transmission date; and
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5.24��� (2) in calculating the
applicable portions of the actuarial
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5.25 valuation, an annual preretirement interest assumption of six
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5.26 percent, an annual postretirement interest assumption of six
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5.27 percent, and an annual salary increase assumption of four
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5.28 percent must be used.
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5.29��� Sec. 5.� Minnesota Statutes 2004, section 423B.01,
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5.30 subdivision 12, is amended to read:
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5.31��� Subd. 12.� EXCESS INVESTMENT INCOME. "Excess
investment
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5.32 income" means the amount, if any, by which the average time
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5.33 weighted total rate of return earned by the fund in the most
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5.34 recent prior five two fiscal years has exceeded the
actual
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5.35 average percentage increase in the current monthly salary of a
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5.36 first grade patrol officer in the most recent prior five two
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6.1� fiscal years plus two
percent, and must be expressed as a dollar
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6.2� amount.� The amount may not exceed one percent of the
total
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6.3 �assets of the fund, except
when the actuarial value of assets of
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6.4� the fund according to the
most recent annual actuarial valuation
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6.5� prepared in accordance with
sections 356.215 and 356.216 is
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6.6� greater than 102 percent of
its actuarial accrued liabilities,
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6.7� in which case the amount must
not exceed 1‑1/2 percent of the
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6.8� total assets of the fund, and
does not exist unless the yearly
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6.9� average percentage increase
of the time weighted total rate of
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6.10 return of the fund for the previous five two years
exceeds by
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6.11 two percent the yearly average percentage increase in monthly
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6.12 salary of a first grade patrol officer during the previous five
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6.13 two calendar years.
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6.14��� Sec. 6.� Minnesota Statutes 2004, section 423B.09,
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6.15 subdivision 1, is amended to read:
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6.16��� Subdivision 1.� MINNEAPOLIS POLICE; PERSONS ENTITLED TO
� 6.17 RECEIVE PENSIONS. The association shall grant pensions payable
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6.18 from the police pension fund in monthly installments to persons
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6.19 entitled to pensions in the manner and for the following
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6.20 purposes.
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6.21��� (a) When the actuarial
value of assets of the fund
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6.22 according to the most recent annual actuarial valuation
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6.23 performed in accordance with sections 356.215 and 356.216 is
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6.24 less than 90 percent of the actuarial accrued liabilities, an
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6.25 active member or a deferred pensioner who has performed duty as
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6.26 a member of the police department of the city for five years or
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6.27 more, upon written application after retiring from duty and
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6.28 reaching at least age 50, is entitled to be paid monthly for
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6.29 life a service pension equal to eight units.� For full years of
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6.30 service beyond five years, the service pension increases by 1.6
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6.31 units for each full year, to a maximum of 40 units.� When the
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6.32 actuarial value of assets of the fund according to the most
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6.33 recent annual actuarial valuation prepared in accordance with
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6.34 sections 356.215 and 356.216 is greater than 90 percent of
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6.35 actuarial accrued liabilities, Active members, deferred
members,
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6.36 and service pensioners are entitled to a service pension
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7.1� according to the following
schedule:
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7.2���������������� 5 years���������� 8.0 units
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7.3���������������� 6 years���������� 9.6 units
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7.4���������������� 7 years��������� 11.2 units
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7.5���������������� 8 years��������� 12.8 units
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7.6����� �����������9 years��������� 14.4 units
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7.7��������������� 10 years��������� 16.0 units
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7.8��������������� 11 years��������� 17.6 units
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7.9��������������� 12 years��������� 19.2 units
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7.10�������������� 13 years��������� 20.8 units
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7.11���������� ����14 years��������� 22.4 units
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7.12�������������� 15 years��������� 24.0 units
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7.13�������������� 16 years��������� 25.6 units
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7.14�������������� 17 years��������� 27.2 units
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7.15�������������� 18 years��������� 28.8 units
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7.16�������������� 19 years��������� 30.4 units
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7.17�������������� 20 years��������� 34.0 35.0 units
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7.18�������������� 21 years��������� 35.6 36.6 units
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7.19�������������� 22 years��������� 37.2 38.2 units
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7.20�������������� 23 years��������� 38.8 39.8 units
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7.21�� ������������24 years��������� 40.4 41.4 units
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7.22�������������� 25 years��������� 42.0 43.0 units
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7.23��� Fractional years of
service may not be used in computing
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7.24 pensions.
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7.25��� (b) An active member who
after five years' service but less
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7.26 than 20 years' service with the police department of the city,
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7.27 becomes superannuated so as to be permanently unable to perform
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7.28 the person's assigned duties, is entitled to be paid monthly for
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7.29 life a superannuation pension equal to four units for five years
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7.30 of service and an additional two units for each full year of
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7.31 service over five years and less than 20 years.
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7.32��� (c) An active member who
is not eligible for a service
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7.33 pension and who, while a member of the police department of the
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7.34 city, becomes diseased or sustains an injury while in the
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7.35 service that permanently unfits the member for the performance
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7.36 of police duties is entitled to be paid monthly for life a
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8.1� pension equal to 34 units
while so disabled.
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8.2���� Sec. 7.� Minnesota Statutes 2004, section 423B.09, is
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8.3� amended by adding a
subdivision to read:
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8.4���� Subd. 7.� ADDITIONAL UNIT. The additional
unit provided
�
8.5� to members by subdivision
1 must also be provided to members who
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8.6� selected a joint annuity
option under subdivision 6 and must be
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8.7� in an amount that is actuarially
equivalent to the service
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8.8� pension and the automatic
survivor coverage for that additional
�
8.9� unit.
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8.10��� Sec. 8.� Minnesota Statutes 2004, section 423B.10,
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8.11 subdivision 1, is amended to read:
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8.12��� Subdivision 1.� ENTITLEMENT; BENEFIT AMOUNT. (a) The
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8.13 surviving spouse of a deceased service pensioner, disability
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8.14 pensioner, deferred pensioner, superannuation pensioner, or
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8.15 active member, who was the legally married spouse of the
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8.16 decedent, residing with the decedent, and who was married while
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8.17 or before the time the decedent was on the payroll of the police
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8.18 department, and who, if the deceased member was a service or
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8.19 deferred pensioner, was legally married to the member for a
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8.20 period of at least one year before retirement from the police
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8.21 department, is entitled to a surviving spouse benefit.� The
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8.22 surviving spouse benefit is equal to 22 23 units per
month if
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8.23 the person is the surviving spouse of a deceased active member
�
8.24 or disabilitant.� The
surviving spouse benefit is equal to six
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8.25 units per month, plus an additional one unit for each year of
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8.26 service to the credit of the decedent in excess of five years,
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8.27 to a maximum of 22 23 units per month, if the person
is the
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8.28 surviving spouse of a deceased service pensioner, deferred
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8.29 pensioner, or superannuation pensioner.� The surviving spouse
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8.30 benefit is payable for the life of the surviving spouse.
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8.31��� (b) A surviving child of a
deceased service pensioner,
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8.32 disability pensioner, deferred pensioner, superannuation
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8.33 pensioner, or active member, who was living while the decedent
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8.34 was an active member of the police department or was born within
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8.35 nine months after the decedent terminated active service in the
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8.36 police department, is entitled to a surviving child benefit.�
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9.1� The surviving child benefit
is equal to eight units per month if
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9.2� the person is the surviving
child of a deceased active member or
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9.3� disabilitant.� The surviving child benefit is equal to two
units
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9.4� per month, plus an additional
four‑tenths of one unit per month
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9.5� for each year of service to
the credit of the decedent in excess
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9.6� of five years, to a maximum
of eight units, if the person is the
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9.7� surviving child of a deceased
service pensioner, deferred
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9.8� pensioner, or superannuation
pensioner.� The surviving child
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9.9� benefit is payable until the
person attains age 18, or, if in
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9.10 full‑time attendance during the normal school year, in a
school
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9.11 approved by the board of directors, until the person receives a
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9.12 bachelor's degree or attains the age of 22 years, whichever
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9.13 occurs first.� In the event
of the death of both parents leaving
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9.14 a surviving child or children entitled to a surviving child
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9.15 benefit as determined in this paragraph, the surviving child is,
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9.16 or the surviving children are, entitled to a surviving child
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9.17 benefit in such sums as determined by the board of directors to
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9.18 be necessary for the care and education of such surviving child
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9.19 or children, but not to exceed the family maximum benefit per
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9.20 month, to the children of any one family.�
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9.21��� (c) The surviving spouse
and surviving child benefits are
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9.22 subject to a family maximum benefit.� The family maximum benefit
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9.23 is 41 units per month.
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9.24��� (d) A surviving spouse who
is otherwise not qualified may
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9.25 receive a benefit if the surviving spouse was married to the
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9.26 decedent for a period of five years and was residing with the
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9.27 decedent at the time of death.�
The surviving spouse benefit is
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9.28 the same as that provided in paragraph (a), except that if the
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9.29 surviving spouse is younger than the decedent, the surviving
�
9.30 spouse benefit must be actuarially equivalent to a surviving
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9.31 spouse benefit that would have been paid to the member's spouse
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9.32 had the member been married to a person of the same age or a
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9.33 greater age than the member's age before retirement.
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9.34��� Sec. 9.� Minnesota Statutes 2004, section 423B.15,
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9.35 subdivision 3, is amended to read:
�
9.36��� Subd. 3.� AMOUNT OF ANNUAL POSTRETIREMENT PAYMENT.
The
�10.1�
amount determined under subdivision 2 must be applied in
�10.2�
accordance with this subdivision.�
When the actuarial value of
�10.3�
assets of the fund according to the most recent annual actuarial
�10.4�
valuation prepared in accordance with sections 356.215 and
�10.5�
356.216 is less than 102 percent of its total actuarial
�10.6�
liabilities, the relief association shall apply the first
�10.7�
one‑half of excess investment income to the payment of an annual
�10.8�
postretirement payment as specified in this subdivision and the
�10.9�
second one‑half of excess investment income up to one‑half
of
�10.10 one percent of the assets of the fund
must be applied to reduce
�10.11 the state amortization state aid or
supplementary amortization
�10.12 state aid payments otherwise due to the
relief association under
�10.13 section 423A.02 for the current calendar
year.� When the
�10.14 actuarial value of assets of the fund
according to the most
�10.15 recent annual actuarial valuation
prepared in accordance with
�10.16 sections 356.215 and 356.216 is less
than 102 percent funded and
�10.17 other conditions are met, the relief association
shall pay an
�10.18 annual postretirement payment to all
eligible members in an
�10.19 amount not to exceed one‑half of
one percent of the assets of
�10.20 the fund.� When the actuarial value of assets of the
fund
�10.21 according to the most recent annual
actuarial valuation prepared
�10.22 in accordance with sections 356.215 and
356.216 is greater than
�10.23 102 percent of its actuarial accrued
liabilities, the relief
�10.24 association shall pay an annual
postretirement payment to all
�10.25 eligible members in an amount not to
exceed 1‑1/2 percent of the
�10.26 assets of the fund.� Payment of the annual postretirement
�10.27 payment must be in a lump sum amount on
June 1 following the
�10.28 determination date in any year.� Payment of the annual
�10.29 postretirement payment may be made only
if the average time
�10.30 weighted total rate of return for the
most recent prior five two
�10.31 years exceeds by two percent the actual
average percentage
�10.32 increase in the current monthly salary
of a top grade patrol
�10.33 officer in the most recent prior five
two fiscal years.� The
�10.34 total amount of all payments to members
may not exceed the
�10.35 amount determined under this
subdivision.� Payment to each
�10.36 eligible member must be calculated by
dividing the total number
�11.1� of
pension units to which eligible members are entitled into the
�11.2�
excess investment income available for distribution to members,
�11.3�
and then multiplying that result by the number of units to which
�11.4�
each eligible member is entitled to determine each eligible
�11.5�
member's annual postretirement payment.�
When the actuarial
�11.6�
value of assets of the fund according to the most recent annual
�11.7�
actuarial valuation prepared in accordance with sections 356.215
�11.8�
and 356.216 is less than 102 percent of its actuarial accrued
�11.9�
liabilities, payment to each eligible member may not exceed an
�11.10 amount equal to the total monthly
benefit that the eligible
�11.11 member was entitled to in the prior year
under the terms of the
�11.12 benefit plan of the relief association
or each eligible member's
�11.13 proportionate share of the excess
investment income, whichever
�11.14 is less.�
When the actuarial value of assets of the fund
�11.15 according to the most recent annual
actuarial valuation prepared
�11.16 in accordance with sections 356.215 and
356.216 is greater than
�11.17 102 percent of its actuarial accrued
liabilities, payment to
�11.18 each eligible member must not exceed the
member's proportionate
�11.19 share of 1‑1/2 percent of the
assets of the fund.
�11.20���
A person who received a pension or benefit for the entire
�11.21 12 months before the determination date
is eligible for a full
�11.22 annual postretirement payment.� A person who received a pension
�11.23 or benefit for less than 12 months
before the determination date
�11.24 is eligible for a prorated annual
postretirement payment.
�11.25���
Sec. 10.� NO REDUCTION OF
BENEFITS.
�11.26���
Once a pension benefit is properly paid in accordance with
�11.27 the laws governing the Minneapolis
Police Relief Association to
�11.28 any member, the dollar amount of the
pension a member received
�11.29 shall not be reduced if the city of
Minneapolis and the
�11.30 collective bargaining agent
representing active police officers
�11.31 enter into or are required to abide
by an agreement that would
�11.32 otherwise require the association to
reduce the dollar amount of
�11.33 a pension that had properly been paid
to any member."
�11.34���
Page 170, after line 4, insert:
�11.35���
"(b) Sections 3 to 10 are not severable and are effective
�11.36 on the day after the date of the
approval by the city council of
�12.1� the
city of Minneapolis and the timely completion by the chief
�12.2� clerical
officer of the city of Minneapolis of compliance with
�12.3� Minnesota
Statutes, section 645.021, subdivisions 2 and 3."
�12.4����
Re‑letter subsequent paragraphs in article 13, section 6,
�12.5�
and change internal cross‑references in that section
�12.6����
Renumber the sections in sequence
�12.7����
Correct internal references
�12.8����
Amend the title accordingly