1.1    .................... moves to amend H.F. No. 1978, the second engrossment, as follows:
1.2Pages 108 to 112, delete sections 1 to 3 and insert:

1.3    "Section 1. ST. PAUL TEACHERS RETIREMENT FUND ASSOCIATION;
1.4PILOT POSTRETIREMENT ADJUSTMENT; LIMITATIONS.
1.5    (a) Notwithstanding any provision of Minnesota Statutes, Chapter 354A, to the
1.6contrary, for calendar years 2008 and 2009 and for postretirement adjustments initially
1.7payable on January 1, 2008, or January 1, 2009, as a pilot program this section supersedes
1.8Minnesota Statutes, Section 354A.29, subdivisions 3 and 4, and the applicable bylaw
1.9provisions of the St. Paul Teachers Retirement Fund Association.
1.10    (b) The postretirement adjustment under the pilot program must be determined by
1.11the executive director and approved by the board annually using the procedures under
1.12this section.
1.13    (c) On January 1, each eligible person who has accrued or received an annuity or
1.14benefit under the articles of incorporation, the bylaws, or this chapter for at least three full
1.15calendar months as of the end of the calendar year is eligible to receive a postretirement
1.16adjustment that is payable the following January 1.
1.17    (d) A percentage adjustment must be computed and paid under this paragraph to
1.18eligible persons under paragraph (c). This adjustment is determined by reference to the
1.19Consumer Price Index for urban wage earners and clerical workers all items index as
1.20reported by the Bureau of Labor Statistics within the United States Department of Labor
1.21each year as part of the determination of annual cost-of-living adjustments to recipients of
1.22federal old-age, survivors, and disability insurance. For calculations of the cost-of-living
1.23adjustment under paragraph (b), the term "average third quarter Consumer Price Index
1.24value" means the sum of the monthly index values as initially reported by the Bureau of
1.25Labor Statistics for the months of July, August, and September, divided by 3.
1.26    (e) Before January 1 of each year, the executive director must calculate the amount of
1.27the cost-of-living adjustment by dividing the most recent average third quarter index value
2.1by the same average third quarter index value from the previous year, subtract one from the
2.2resulting quotient, and express the result as a percentage amount, which must be rounded
2.3to the nearest one-tenth of one percent. The final amount may not be a negative number
2.4and may not exceed 2.5 percent if the rate of investment return of the retirement fund
2.5either for the most recent fiscal year or for the most recent five-year period, each calculated
2.6under the formula specified in section 11A.04, clause (11), is less than 8.5 percent and may
2.7not exceed 5.0 percent if the rate of investment return of the retirement fund both for the
2.8most recent fiscal year and for the most recent five-year period, each calculated under the
2.9formula specified in section 11A.04, clause (11), are equal to or greater than 8.5 percent.
2.10    (f) The amount calculated under paragraph (b) is the full cost-of-living adjustment
2.11to be applied as a permanent increase to the regular payment of each eligible member
2.12on January 1 of the next calendar year. For any eligible member whose effective date
2.13of benefit commencement occurred during the calendar year before the cost-of-living
2.14adjustment is applied, the full increase amount must be prorated on the basis of whole
2.15calendar quarters in benefit payment status in the calendar year prior to the January 1 on
2.16which the cost-of-living adjustment is applied, calculated to the third decimal place.
2.17    (g) This pilot postretirement adjustment program does not constitute a precedent for
2.18this or any other retirement plan.

2.19    Sec. 2. MANDATED STUDY AND REPORT ON SPTRFA POSTRETIREMENT
2.20ADJUSTMENT EXPERIENCE.
2.21    (a) The Legislative Commission on Pensions and Retirement shall study the
2.22experience of the St. Paul Teachers Retirement Fund Association under the temporary
2.23postretirement adjustment mechanism under section 1 and shall consider any proposals
2.24or analyses presented by other Minnesota public retirement plans regarding potential or
2.25proposed postretirement adjustment mechanism changes. Following the completion of
2.26its study, on or before January 15, 2009, the Legislative Commission on Pensions and
2.27Retirement shall report to the chair of the House Committee on Governmental Operations,
2.28Reform Technology and Elections, the chair of the House Committee on Finance, the
2.29chair of the Senate Committee on State and Local Governmental Operations, and the
2.30chair of the Senate Committee on Finance its findings and recommendations regarding a
2.31possible continuation, modification, or elimination of the temporary mechanism specified
2.32in section 1.
2.33    (b) For fiscal years 2007 and 2008, in addition to the regular actuarial valuation
2.34prepared under Minnesota Statutes, section 356.215, the St. Paul Teachers Retirement
2.35Fund Association shall have prepared and shall file with the Legislative Commission on
2.36Pensions and Retirement a supplemental actuarial valuation report providing comparative
3.1data on the funded status, actuarial requirements, contribution sufficiency or deficiency,
3.2and any other relevant results if the temporary postretirement adjustment mechanism
3.3under section 1 was a permanent mechanism. This report must be submitted for inclusion
3.4in the study required under paragraph (a)."
3.5Renumber the articles in sequence and correct the internal references
3.6Amend the title accordingly