Purpose of the Bill

The bill aims to amend existing laws related to the Public Employees Retirement Association (PERA) in Minnesota, specifically focusing on the retirement plans for employees affected by the privatization of governmental subdivisions, such as public medical facilities.

Main Provisions

• Expansion of Retirement Coverage: The bill seeks to ensure that employees who are affected by the privatization of governmental subdivisions continue to receive retirement benefits as part of the PERA's general employees retirement plan.

• Amendments and Additions to Definitions: It extends definitions related to privatization, such as "Privatized former public employer" and "Privatized former public employee," and it clarifies what "privatization" involves.

• Withdrawal Liability Calculation: The method for calculating withdrawal liability for privatized entities is revised. Withdrawal liability is defined as the present value of accrued benefits adjusted by the funding ratio of the retirement fund.

• Payment of Withdrawal Liability: Privatized employers must pay their calculated withdrawal liability within six months after privatization unless they opt for a payment plan of up to ten years.

• Enhanced Reporting Requirements: The bill introduces new requirements for annual reporting on privatizations and mandates maintaining and publishing records of withdrawal liabilities.

• Vesting and Benefits: It confirms that privatized employees will still be eligible for early retirement and other benefits without needing to meet new service requirements, and outlines specific augmentation rates for deferred annuities of privatized employees.

• Survivor Benefits: The rights of surviving spouses and dependent children are protected under the amended provisions.

Significant Changes to Existing Law

• Administrative Updates: Technical adjustments and additions to make the law accommodate the new provisions for privatization, including more precise definitions and processes.

• Repeal of Existing Subdivision: The bill repeals Section 353F.02, subdivision 4a, to accommodate new provisions and updates in the bill.

Relevant Terms

public employees retirement, privatization, withdrawal liability, augmentation rates, governmental subdivision, retirement benefits, vested rights, public medical facilities, survivor benefits, privatized employer.