Subdivision 1.Amortization state aid.
(a) The cities of Fairmont and Minneapolis are entitled, subject to subdivisions 2, 4, and 5, to receive amortization state aid under this section.
(b) The total amount of amortization state aid to all entitled municipalities must not exceed the appropriation under subdivision 3a.
(c) The amortization state aid amounts are:
If the amortization state aid amounts determined under this paragraph exceed the amount appropriated for this purpose under subdivision 3a, the amortization state aid for actual allocation must be reduced pro rata.
(d) Each municipality is eligible for an amortization state aid payment in a fiscal year if:
(1) for Fairmont, the executive director of the Public Employees Retirement Association certifies on or before June 30 that a municipal contribution with respect to the former Fairmont Police Relief Association is payable in the upcoming fiscal year under section353.665, subdivision 8, paragraph (c); and
(2) for Minneapolis, the executive director of the Public Employees Retirement Association certifies on or before June 30 that an additional employer contribution with respect to either the former Minneapolis Firefighters Relief Association or the former Minneapolis Police Relief Association is payable in the upcoming fiscal year under section 353.665, subdivision 8a.
Payment of amortization state aid to municipalities must be made to the municipalities involved in three equal installments on July 15, September 15, and November 15 annually. Upon receipt of amortization state aid, the municipal treasurer shall transmit the aid amount to the custodian of the local trust fund or to the executive director of the public employees police and fire retirement fund, whichever applies, for immediate deposit.
(e) The commissioner of revenue shall administer the amortization state aid program. The commissioner shall prescribe and periodically revise, as necessary, the required content of the certifications for amortization state aid.
Subd. 1a.
[Repealed,2013 c 111 art 5 s 81]
Subd. 1b.Additional amortization state aid.
(a) Annually, the commissioner shall allocate the additional amortization state aid, if any, including any state aid in excess of the limitation in subdivision 4, on the following basis:
(1) 47.1 percent to the city of Minneapolis to defray the employer costs associated with police and firefighter retirement coverage;
(2) 25.8 percent as additional funding to support the minimum fire state aid for volunteer firefighter relief associations under section477B.03, subdivision 5;
(3) 12.9 percent to the city of Duluth to defray employer costs associated with police and firefighter retirement coverage;
(4) 12.9 percent to the St. Paul Teachers Retirement Fund Association if the investment performance requirement of paragraph (c) is met; and
(5) 1.3 percent to the city of Virginia to defray the employer contribution under section353.665, subdivision 8, paragraph (d).
If there is no additional employer contribution under section353.665, subdivision 8a, certified under subdivision 1, paragraph (d), clause (2), with respect to the former Minneapolis Police Relief Association and the former Minneapolis Fire Department Relief Association, the commissioner shall allocate that 47.1 percent of the aid as follows: 49 percent to the Teachers Retirement Association, 21 percent to the St. Paul Teachers Retirement Fund Association, and 30 percent as additional funding to support minimum fire state aid for volunteer firefighter relief associations under section477B.03, subdivision 5. If there is no employer contribution by the city of Virginia under section353.665, subdivision 8, paragraph (d), for the former Virginia Fire Department Relief Association certified on or before June 30 by the executive director of the Public Employees Retirement Association, the commissioner shall allocate that 1.3 percent of the aid as follows: 49 percent to the Teachers Retirement Association, 21 percent to the St. Paul Teachers Retirement Fund Association, and 30 percent as additional funding to support minimum fire state aid for volunteer firefighter relief associations under section477B.03, subdivision 5.
(b) The allocation must be made by the commissioner of revenue on October 1 annually.
(c) With respect to the St. Paul Teachers Retirement Fund Association, annually, if the teacher's association five-year average time-weighted rate of investment return does not equal or exceed the performance of a composite portfolio assumed passively managed (indexed) invested ten percent in cash equivalents, 60 percent in bonds and similar debt securities, and 30 percent in domestic stock calculated using the formula under section11A.04, clause (11), the aid allocation to the retirement fund under this section ceases until the five-year annual rate of investment return equals or exceeds the performance of that composite portfolio.
(d) The amounts required under this subdivision are the amounts annually appropriated to the commissioner of revenue under section477B.03, subdivision5, paragraph (d), if any, and the aid amounts in excess of the limitation in subdivision 4.
Subd. 2.Continued eligibility.
A municipality that received amortization aid in 2011 and is required to make a municipal contribution under section 353.665, subdivision 8, paragraph (c) or (d), or subdivision 8a, whichever applies, continues to qualify for amortization state aid for the duration of the applicable municipal contribution.
Subd. 3.Reallocation of amortization state aid.
(a) Seventy percent of the difference between $5,720,000 and the current year amortization aid distributed under subdivision 1 that is not distributed for any reason to a municipality must be distributed by the commissioner of revenue according to this paragraph. The commissioner shall distribute 60 percent of the amounts derived under this paragraph to the Teachers Retirement Association, and 40 percent to the St. Paul Teachers Retirement Fund Association to fund the unfunded actuarial accrued liabilities of the respective funds. These payments must be made on July 15 each fiscal year. If the St. Paul Teachers Retirement Fund Association or the Teachers Retirement Association satisfies subdivision 5, eligibility for its portion of this aid ceases. Amounts remaining in the undistributed balance account at the end of the biennium if aid eligibility ceases cancel to the general fund.
(b) In order to receive amortization aid under paragraph (a), before June 30 annually Independent School District No. 625, St. Paul, must make an additional contribution of $800,000 each year to the St. Paul Teachers Retirement Fund Association.
(c) Thirty percent of the difference between $5,720,000 and the current year amortization aid under subdivision 1 that is not distributed for any reason to a municipality must be distributed under section477B.03, subdivision 5, as additional funding to support a minimum fire state aid amount for volunteer firefighter relief associations.
Subd. 3a.Appropriations for amortization state aid and amortization state aid reallocations.
$5,720,000 is annually appropriated from the general fund to the commissioner of revenue for amortization state aid under subdivision 1, and for the reallocation of amortization aid under subdivision 3.
Subd. 4.Limit on certain total aid amounts.
(a) The total of amortization aid and additional amortization aid under this section payable to a municipality to which section 353.665, subdivision 8, paragraph (c) or (d), or subdivision 8a, applies, may not exceed the amount of the additional municipal contribution payable by an individual municipality under section 353.665, subdivision 8, paragraph (c) or (d), or subdivision 8a.
(b) Any aid amount in excess of the limit under this subdivision for an individual municipality must be redistributed to the other municipalities to which section 353.665, subdivision 8, paragraph (c) or (d), or subdivision 8a, applies. The excess aid must be distributed in proportion to each municipality's additional municipal contribution under section 353.665, subdivision 8, paragraph (c) or (d), or subdivision 8a.
(c) When the total aid for each municipality under this section equals the limit under paragraph (a), any aid in excess of the limit must be redistributed under subdivision 1b.
Subd. 5.Termination of state aid programs.
The amortization state aid and additional amortization state aid programs continue until the earlier of:
(1) the December 31 following three consecutive fiscal years in which, for each fiscal year, the actuarial value of assets of the St. Paul Teachers Retirement Fund Association or the Teachers Retirement Association equals or exceeds 100 percent of the actuarial accrued liabilities as reported by the actuary retained under section356.214in the annual actuarial valuation report prepared under section356.215; or
(2) July 1, 2048.