Section 1. [Additional long-term equity investment authority] This section allows certain counties and cities to invest in mutual funds or with the Minnesota State Board of Investments.
Subdivision 1. [Definition; qualifying government.] Defines “qualifying government” as: (1) a county or city with a population of more than 100,000; (2) a county or city with highest category of bond rating; and (3) certain county or city self-insurance pools.
Subd. 2. [Additional investment authority.] Qualifying governments are authorized to invest in mutual funds based in the U.S. or with the Minnesota State Board of Investments.
Subd. 3. [Funds.] Cities and counties may only invest cash and investments that are held for long-term capital plans or long-term obligations. Cities and counties may only invest up to 15 percent of the sum of unassigned cash, cash equivalents, deposits, and investments. A self-insurance pool may invest the lesser of 15 percent of the sum of its cash, deposits, and investments or 25 percent of its net assets.
Subd. 4. [Approval.] Before a qualifying government may invest in the manner authorized by this section, the governing body must adopt a resolution that acknowledges the potential risk of loss and that it understands the type of funds that are being invested.
Subd. 5. [Public Employees Retirement Association to act as account administrator.] A qualifying government that invests with State Board of Investments must establish an account with the Public Employees Retirement Association (PERA). PERA is the account administrator.
Subd. 6. [Purpose of account.] An account established with PERA must only be used for the authorized purposes.
Subd. 7. [Account maintenance.] PERA must establish a separate account for each qualifying government that invests in the State Board of Investment. PERA may charge a fee for administrative costs. PERA must report to the qualifying government on the investment returns.
Subd. 8. [Investment.] PERA must certify all money in the accounts that it administers under this section to the State Board of Investments for investment. Investment earnings are credited to the individual account of the qualifying government. A qualifying government may provide investment direction to PERA.
Subd. 9. [Withdrawal of funds and termination of account.] A qualifying government may withdraw some or all of its money or terminate the account in the manner prescribed by PERA.