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Attachment A plan administration to the Public Employees Retirement Association (PERA) and, in either event, clarifies the disposition of plan assets as an asset of the Roseville city treasury upon the payment of the last annuity or benefit payment from the relief association. If introduced during the 2015 Legislative Session and heard by the Legislative Commission on Pensions and Retirement, the potential proposed legislation would likely raise several pension and related public policy issues for consideration and potential discussion between members of the Commission, as follows: 1.Likelihood of Local Legislation Approval by City of Roseville. The policy issue is the extent of interest in the potential local legislation by the Roseville mayor, city council, and city administrator and the likelihood that the potential local legislation, if enacted by the Legislature, would be approved by the city. If the City of Roseville does not support the proposed resolution of the administration and governance problem of the Roseville Volunteer Firefighters' Relief Association, the potential proposed local legislation may not be approved locally and consideration of the potential proposed legislation would not be a good expenditure of valuable legislative time and effort by the Commission and subsequent standing committees with pension policy jurisdiction. The City of Roseville has publicly supported efforts by the Roseville Volunteer Firefighters' Relief Association to seek a legislative remedy to its administration and governance issue, but the city has not yet had an opportunity to review the potential proposed legislation. A city council resolution of support of the potential proposed legislation in time for the Commission hearing on any Roseville Volunteer Firefighters' Relief Association bill would resolve this issue. 2.Support for the Potential Proposed Resolution by the Roseville Volunteer Firefighters' Relief Association. The policy issue is whether or not the current board of trustees of the Roseville Volunteer Firefighters' Relief Association is supportive of the potential proposed resolution of the relief association's administration and governance issue. Under the potential proposed legislation, depending on the near-term composition of the active member portion of the relief association, at least one current active member representative on the relief association board of trustees would be replaced by a retired member by operation of the new law in a special election. If most or all of the current active membership of the relief association have their city employment status changed and have their retirement coverage changed from the Roseville Volunteer Firefighters' Relief Association to a plan run by PERA in short order, the number of board members to be replaced in short order before their terms of office have fully run would be greater. Two members of the current Roseville Volunteer Firefighters' Relief Association board have indicated their support for the proposed resolution and have expressed their opinion that the balance of the relief association board would be supportive, but the resolution of this governance and administration issue has been more conceptual than document- driven up to this time. If there is opposition on the Roseville Volunteer Firefighters' Relief Association board to the proposed administration and governance issue resolution, that controversy should be resolved in Roseville rather than in St. Paul during the legislative session. 3.Short-Term and Long-Term Relief Association Phase-Out Issues. The policy issue is whether or not the potential proposed legislation adequately addresses the Roseville Volunteer Firefighters' Relief Association administration and governance issue for both the short term and for the long term. Previously, when Minnesota public pension plans have been placed on a phase-out basis by closure of the membership to new entrants, the closure was done by legislation. The Roseville Volunteer Firefighters' Relief Association closure apparently was accomplished by city action only and the question of the future administration and governance of the Roseville Volunteer Firefighters' Relief Association does not appear to have been addressed. The systematic replacement of active relief association board members by retired members as the phase-out proceeds that was initially proposed by the relief association members will solve the immediate problem of the governance of the relief association, but some additional option for the time when loss of interest, significant change in residence location, or diminished capability in the pool of retired members over time needs to be provided. Current law, Minnesota Statutes, Section 424A.015, Subdivision 3, provides one avenue for a replacement administration structure, by allowing the relief association to purchase annuity contracts from an insurance company licensed to do business in Minnesota to replace the current benefits of retirees that are currently self-insured by the relief association, which if implemented en masse, would substitute the insurance carrier for the current relief association officers. The potential proposed legislation adds, as an option, an additional avenue by permitting a transfer of the administration of the former relief association to the statewide local government employee retirement system, the Public Employees Retirement Association (PERA), with the PERA board and executive director replacing the current relief association structure. The PERA transfer would require city approval before finalization, but could be exercised either in the near term or in the longer term based on the judgment of the Roseville Volunteer Firefighters' Relief Association board of trustees. The potential proposed legislation, building on the current annuitization statutory authority provides options for the proper management of the affairs of the relief association without disruption unless the relief association board is not vigilant in monitoring the quality and capability of its members. LCPR14-052 Memo.docx Page 2