Agenda - Council - 01/12/1982 - Laserfiche WebLink

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I I ! I I I I i I I I I I I I I is patently unnecessary. If the United States Supreme Court determines that such legislation is constitutional and that Congress finds it necessary to adopt some sort of national legislation in this area, we believe the best alternative would be to extend the provision of the National Labor Rela- tions Act to cover public employers and employees in those states that do not have existing labor legislatibn, allowing states the opportunity to establish their own laws as the need arises. IV-$. Proposed Federal Pension Legislation (B) The State of Minnesota through its legislature has demonstrated a continuing concern over the past two decades for the security of public em- ployee retirement funds. Standards have been adopted requiring full funding and steps have been taken to strengthen management responsi- bility and reporting to employees. Moreover, a permanent commission has been established by the legislature to study and analyze public re- tirement funds and advise the legislature on ap- propriate steps. Adequate controls and standards exist in Minnesota to safeguard the interest of the participants in public employee retirement funds. For these reasons, the League recommends that any proposed national controls and standards per- rain only to matters of funding and should be de- signed to exclude public funds such as those in Minnesota where adequate safeguards are present. IV-9. Taxation of PERA Contributions (A) For several years, litigation has been pending in federal courts to consider whether employee con- tributions to PERA and similar public pension systems should be subject to federal income tax laws during the year in which they are contributed to the system, as opposed to the year in which the employee actually receives the benefit. To our knowledge, no similar litigation is pending regard- lng the applicability of the state income tax. It may be argued that the individual employee does not have the use of the contributions which he makes to PERA in the year in which they are contributed and therefore, the contributions should not be subject to either state or federal income taxation, but should be excluded from the employee's gross income. Rather, it may be argued that the contributions should not be taxed until the benefits are actually received. Such a position would be consistent with the way in which the municipal contributions to the employees' pen- sions are taxed. -19- Therefore, the League recommends that the PERA and state income tax laws be amended as follows: Employee deductions to PERA and similar employee pension systems should be deducted from the employee's gross income and other deferred compensation plans presently per- mitted by law and not subjected to state income taxation during the year contributed to PERAo IV-10. Veterans Preference (B) In 1975, the legislature adopted a uniform veterans' preference ]aw for state and local govern- ment which modified preference in employment and promotion; in 1977, the legislature terminated veterans' preference for persons who enter mili- tary service after 1976. The League supports these modifications and believes that these provisions should not be amended further. Veterans should continue to be protected against unjust dismissals, but when a veteran's employment is terminated, and he or she does not request a hearing within ten days or when an impartial hearing body deter- mines that the dismissal was for just cause, the law should not require that the veteran receive compensation for any period when services were not actually performed. Further, the law should make it clear that the petition procedure is an alternative to local administrative hearings. IV-11. Volunteer Ambulance Retirement Sys- tems (C) Proposals to integrate ambulance and rescue volunteers not part of local volunteer fire depart- ments into the program for retirement for volun- teer firefighters have met rejection from organiza- tions of volunteer firefighters. Creation of another system of local relief is not in the best interest of the state, its political subdivisions, or its taxpayers, especially in view of recent federal tax legislation which now provides an efficient, simple and inex- pensive means of providing retirement benefits to ambulance and other volunteers. Therefore, the League opposes any legislation authorizing crea- tion of volunteer ambulance relief associations. In addition, the League urges the creation of a state money purchase retirement plan for volun- teers only. IV-12. Social Security (C) Many public employees in Minnesota are covered