18apr01...0891h

2001 SESSION

01-1069

03/09

HOUSE BILL 2-FN-A

COMMITTEE: Finance

AMENDED ANALYSIS

This bill:

I. Establishes a travel and tourism development fund.

II. Requires that acceptance and expenditures of federal aid and any other non-state funds in excess of $100,000 be approved by the joint legislative fiscal committee.

III. Provides for the costs of administration of the retirement system to be a charge upon retirement system funds.

IV. Provides for the method of funding payments for certain group I members of the New Hampshire retirement system.

V. Establishes an administrative fund for the land and community heritage investment authority and adds certain powers and duties of the authority.

VI. Provides that the initial funding mechanism and appropriation for the telecommunications planning and development initiative shall not lapse until June 30, 2002.

VII. Permits the commissioner of the department of health and human services to fill authorized unfunded positions.

VIII. Requires that $1,500,000 from the tobacco use prevention fund lapse to the general fund.

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Explanation: Matter added to current law appears in bold italics.

Matter removed from current law appears [in brackets and struckthrough.]

Matter which is either (a) all new or (b) repealed and reenacted appears in regular type.

18apr01...0891h

01-1069

03/09

STATE OF NEW HAMPSHIRE

In the Year of Our Lord Two Thousand One

Be it Enacted by the Senate and House of Representatives in General Court convened:

1 New Section; Department of Resources and Economic Development; Travel and Tourism Development; Travel and Tourism Development Fund. Amend RSA 12-A by inserting after section 43 the following new section:

12-A:43-a Travel and Tourism Development Fund.

I. There is hereby established in the office of the state treasurer a fund to be known as the travel and tourism development fund. Any appropriations received shall be deposited in the fund. Moneys in the fund and any interest earned on the fund shall be used for the purpose of promoting and developing appropriate travel and tourism initiatives through the division of travel and tourism development and shall not be used for any other purpose. The director of travel and tourism development shall oversee expenditures from the fund. The moneys in the fund shall be non-lapsing and shall be continually appropriated to the department of resources and economic development.

II. The commissioner of resources and economic development shall prepare an annual report to be presented no later than December 1 of each year to the president of the senate, the speaker of the house of representatives, and the governor and council, and filed with the state library. The report shall detail the specific activities supported by, and expenditures from, the fund during the past year.

2 New Subparagraph; Travel and Tourism Development Fund. Amend RSA 6:12, I by inserting after subparagraph (dddd) the following new subparagraph:

(eeee) Moneys received for deposit in the travel and tourism development fund established by RSA 12-A:43-a, I.

3 New Paragraph; Fiscal Committee Approval Required for Acceptance and Expenditure of Funds Over $100,000 From Any Non-State Source. Amend RSA 14:30-a by inserting after paragraph V the following new paragraph:

VI. Any non-state funds in excess of $100,000, whether public or private, including refunds of expenditures, federal aid, local funds, gifts, bequests, grants, and funds from any other non-state source, which under state law require the approval of governor and council for acceptance and expenditure, may be accepted and expended by the proper persons or agencies in the state government only with the prior approval of the fiscal committee.

4 Fiscal Committee Approval Required for Expenditure of Federal Aid. Amend RSA 124:4 to read as follows:

124:4 Application for[,] and Administration of Federal Aid. Notwithstanding any other provision of law, the governor and council are hereby authorized to designate from time to time, as they may deem in the best interest of the state, the proper persons or agencies in the state government to take all necessary action to apply for, receive, and administer any federal benefits, facilities, grants-in-aid, or other federal appropriations or services made available to assist state activities, for which the state is, or may become eligible. All such moneys in excess of $100,000 made available, after designation by the governor and council, may be expended by the proper persons or agencies in the state government only with the prior approval of the joint legislative fiscal committee, provided, however, that prior approval by the joint legislative fiscal committee shall not be required for any federal moneys received by the department of employment security. In addition to such other instruments, documents, and agreements as may be executed [hereunder] under the authority of this section, such persons or agencies may[, whenever the same shall be required as a condition to the receipt of such federal assistance, with the approval of the governor and council] execute indemnification agreements, with the approval of governor and council, in the name of the state with and for the benefit of the United States whenever such execution is required as a condition of receipt of such federal assistance.

5 Retirement System; Definition of Employee. Amend RSA 100-A:1, V to read as follows:

V. "Employee" shall mean any regular classified or unclassified officer or employee of the state or any department, commission, institution or agency of the state government by which an employee is paid through the office of the state treasurer, or employees of the general court who work on a full-time basis and are eligible for other state benefits, but whose salary is calculated on a per diem basis or any employee of the retirement system or of any of the groups authorized to participate [in the retirement system] under this chapter but excluding any person who is a teacher, permanent policeman, or permanent fireman as defined in this section, or who is a member or attache of the general court or member of the executive council.

6 Retirement System; Administration. Amend RSA 100-A:14, V to read as follows:

V. The board of trustees [may] shall have the full power to employ and compensate such classified employees on such terms as may be necessary as charges upon the funds of the retirement system. It may also engage such actuarial, medical, and like services as may be required to transact the business of the system. The compensation for such special services, and all other expenses of the board necessary, hereto, shall be paid at such rates and in such amounts as the board shall approve.

7 Retirement System; Administrative Cost Assessment. RSA 100-A:14, XIII is repealed and reenacted to read as follows:

XIII. Administrative Cost Assessment. Other provisions of law notwithstanding, the cost of administration of the retirement system as provided in this section shall be a charge upon the funds of the retirement system. The amount of administrative expense recorded monthly by the department of administrative service, division of accounting services, shall be paid to the state treasurer by the board of trustees. The board shall biennially review the administrative expenses for the previous biennium and shall submit in a budget for legislative appropriation, those amounts that the board, in its reasonable discretion, may deem necessary for the efficient operation of the system. Administrative balances accrued prior to June 30, 2001 shall be retained by the retirement system and expended for ongoing operations.

8 Retirement System; Management of Funds. Amend RSA 100-A:15, IV to read as follows:

IV. The board of trustees is authorized to engage the services of legal counsel for special investment, federal, and tax matters and[, with the approval of the attorney general,] to engage outside counsel for other matters. The payment for services provided in this paragraph shall be a charge upon the funds of the New Hampshire retirement system.

9 Retirement System; Executive Director. Amend RSA 100-A:44 to read as follows:

100-A:44 Appointment; Removal. The board of trustees of the retirement system shall have the full power to appoint and compensate an executive director [who shall hold office during good behavior. The board may remove the executive director for cause] to perform such duties on such terms as it may require.

10 Executive Director Salary; Director of Finance. Amend RSA 100-A:47 and 47-a to read as follows:

100-A:47 Salary. The annual salary of the executive director shall be [that prescribed by RSA 94:1-4] set at such rates as the board of trustees may deem necessary to attract and retain a suitably qualified individual.

100-A:47-a Appointment; Duties; and Compensation. The executive director of the retirement system shall nominate a director of finance for appointment by the board of trustees. The director of finance shall assist the board of trustees in the management of retirement system funds. The director of finance shall report directly to the board of trustees or to a person or persons designated by the board and shall serve at their pleasure. The director of finance shall be qualified to hold the position by reason of education and experience. The annual salary for the director of finance shall be [that prescribed by RSA 94:1-a, I, Group M] set at such rates as the board of trustees may deem necessary in order to attract and retain a suitably qualified individual.

11 New Hampshire Retirement System; Payment by Retirement System-Group I; Amend RSA 100-A:52-a to read as follows:

100-A:52-a Payment by Retirement System; Group I [Teachers and Political Subdivision Employees].

I. The New Hampshire retirement system shall pay the cost for permanent group hospitalization, hospital medical care, surgical care, and other medical and surgical benefits, in the employer-sponsored plan provided for active employees of a retiree's former employer, subject to the provisions of this section, for the following persons:

(a) Any person, who has at least 20 years of creditable service as a group I member if age 60 or older, or at least 30 years of creditable service as a group I member if age 55-59, retired on or before July 1, 2004 as a group I [teacher member or political subdivision employee] member of the New Hampshire retirement system on service or ordinary disability retirement, provided that such person shall be entitled to retirement on the basis of group I creditable service, or any person retired on or before July 1, 2004, as a group I member whose service retirement benefit is based upon the provisions of RSA 100-A:19-c and who has a minimum of 20 years of creditable service as a group I member.

(b) Any person who has completed no less than 20 years of group I creditable service, but who for reasons other than retirement or death ceased to be a group I [teacher member or political subdivision employee] member prior to attaining the age of 60, and who, as of July 1, 2004, receives a vested deferred retirement allowance and who subsequently attains the age of 60.

(c) Any person who has completed no less than 20 years of group I creditable service and who retired as a group I [teacher member or political subdivision employee] member prior to age 60, and who subsequently attains the age of 60, or any person who has completed no less than 30 years of group I creditable service and who retired as a group I [teacher member or political subdivision employee] member prior to age 55, and who subsequently attains the age of 55.

(d) The surviving spouse of a deceased retired group I teacher member or political subdivision employee member who met the qualifications of subparagraphs (a), (b) or (c), or of a deceased member who died while in service as a group I teacher member or political subdivision employee member, provided that such surviving spouse was covered as the member's spouse in the employer-sponsored plan before the member's death and is entitled to a monthly allowance under RSA 100-A:8, 100-A:9, or 100-A:13.

(e) Any certifiably dependent child with a disability living in the household and being cared for by the qualified retired member, the member's spouse, or the qualified surviving spouse.

(f) The surviving spouse and children of a deceased [teacher or] group I [political subdivision employee] member who dies as the natural and proximate result of injuries suffered while in the performance of duty, provided that:

(1) Any such child shall be qualified under this subparagraph only if under 18 years of age, or under 23 years of age if attending school on a full-time basis; and

(2) Such surviving spouse shall cease to be qualified upon the remarriage of the surviving spouse; and

(3) No surviving spouse or child shall be qualified or continue to be qualified under this subparagraph while receiving or eligible to receive medical insurance or health care benefits from any employer's sponsored plan.

(g) Any group I [teacher member or political subdivision employee] member retired on or before July 1, 2004 on disability retirement as the natural and proximate result of injuries suffered while in the performance of duty.

(h) The spouse of a qualified retiree.

I-a. Notwithstanding the provision of RSA 100-A:4, III-b, for the purpose of calculating creditable service for eligibility for medical benefits payment under paragraph I, each full year of job-sharing service of a teacher in a job-sharing position shall be calculated at 1/2[;] of one year of such service credit.

II. However, for the fiscal year beginning July 1, 2000, the maximum amount payable by the retirement system under this subdivision on account of each person qualified under paragraph I who is not entitled to medicare benefits, and on account of each person qualified under paragraph I who is entitled to medicare benefits, shall be the same as the amount provided in RSA 100-A:52, II for group II retirees. As of July 1, 2000 and on each July 1 thereafter, the maximum amount payable by the retirement system as provided in this paragraph shall be increased by 8 percent, compounded on previous increases.

III. In the case of group I members retired from employment by political subdivisions of the state, the amount payable by the retirement system on account of qualified persons shall be paid over to the employer, insurer, or health care administrator and used to pay for all or part of the medical benefits provided through the former employer for qualified persons. If the cost of the premium for any eligible person under paragraph I shall exceed the maximum under paragraph II, and the employer does not elect to pay the excess cost, the excess cost shall be paid by the retiree or qualified surviving spouse and may be deducted from retirement benefits as provided in RSA 100-A:51. The employer may require, as a condition for coverage, that the retiree or surviving spouse apply for deduction of such excess cost from retirement benefits as provided in RSA 100-A:51.

III-a. As of January 1, 2002, in the case of group I members retired from state employment before July 1, 1991, and their beneficiaries who are eligible for coverage under this subdivision and also under the provisions of RSA 21-I:26-36, the amount payable by the retirement system on account of such persons shall be paid over to the state and used to pay for all or part of the medical benefits provided under RSA 21-I:26-36 for such persons, and the balance shall be paid by the state as provided in RSA 21-I:26-36.

III-b. As of January 1, 2002, in the case of group I members retired from state employment on or after July 1, 1991, and their beneficiaries who are eligible for coverage under this subdivision and also under the provisions of RSA 21-I:26-36, the amount payable by the retirement system on account of such persons shall be paid over to the state and used to pay for all or part of the medical benefits provided under RSA 21-I:26-36 for such persons, and the state shall pay its portion as provided in RSA 21-I:26-36. If the cost of the premium for any retired group I member and spouse, surviving spouse, or any other person entitled to benefits under paragraph I shall exceed the maximum under paragraph II, and the state does not elect to pay the excess cost above the amount to be paid under RSA 21-I:26-36, the excess cost shall be paid by the retiree or qualified surviving spouse and may be deducted from retirement benefits as provided in RSA 100-A:51. The state may require, as a condition for coverage, that the retiree or surviving spouse apply for deduction of such excess cost from retirement benefits as provided in RSA 100-A:51.

IV. There shall be no age limit to participate in the employer sponsored medical and health plan provided in paragraph I, and there shall be no physical examination or health statement required for such coverage, provided, however, that if an eligible retired group I [teacher member or political subdivision employee] member of the retirement system fails to apply for such coverage within the time required by the insurance contract, the insurer may require satisfactory evidence of insurability as a condition for becoming insured.

V. Any group I teacher member retired before January 1, 2000, or other eligible person under paragraph I, who would have been eligible for medical benefits under this section if this section had been in effect on the member's date of retirement, shall have the option of re-joining the medical or health plan sponsored by the retired member's former employer and of receiving benefits under this section, provided that such eligible person shall apply to the employer for such benefits before January 1, 2002. Upon receipt of such application, the former employer shall enroll such retiree or other eligible person in the employer's plan in the same manner and subject to the same conditions as enrollment of a new employee but without any benefit-waiting period which may be applicable to new employees of that employer. Neither an employer nor an employer's group plan or insurer shall be liable for any claims incurred prior to the date of enrollment under this paragraph.

VI. Any group I political subdivision employee member retired before January 1, 2001, or other eligible person under paragraph I, who would have been eligible for medical benefits under this section if this section had been in effect on the member's date of retirement, shall have the option of re-joining the medical or health plan sponsored by the retired member's former employer and of receiving benefits under this section, provided that such eligible person shall apply to the employer for such benefits before January 1, 2003. Upon receipt of such application, the former employer shall enroll such retiree or other eligible person in the employer's plan in the same manner and subject to the same conditions as enrollment of a new employee but without any benefit-waiting period which may be applicable to new employees of that employer. Neither an employer nor an employer's group plan or insurer shall be liable for any claims incurred prior to the date of enrollment under this paragraph.

VII. The retirement system shall notify all group I teacher and political subdivision employee retirees and surviving spouse beneficiaries, who are currently drawing monthly allowances from the retirement system, of their possible right to re-join and active-employee medical insurance or health plan and to receive benefits under this section.

VIII. Any person who is eligible to receive group insurance or other medical benefits under the provisions of this section, but who does not need and who declines such benefits because they would be duplicative of coverage under any employer-sponsored plan, shall nevertheless continue to be eligible and, upon ceasing to be eligible for the other coverage, shall be permitted to receive the benefits allowable under this section without any waiting period.

12 New Section; New Hampshire Retirement System; Method of Financing; Group I State Employees. Amend RSA 100-A by inserting after section 53-c the following new section:

100-A:53-d Method of Financing; Group I State Employees.

I. The benefits provided under RSA 100-A:52-a shall be provided by a 401(h) subtrust of the New Hampshire retirement system. The 401(h) subtrust shall be funded by allocating 25 percent of future group I state employer contributions made for group I state employees in accordance with RSA 100-A:16 to the subtrust until such time as the benefits are fully funded. Thereafter, the subtrust shall receive only that portion of each year's contribution as is necessary to keep the benefits fully funded.

II. All contributions made to the retirement system to provide medical benefits under RSA 100-A:52-a shall be maintained in a separate account, the 401(h) subtrust. All funds and accumulated interest shall not be used for or diverted to any purpose other than to provide said medical benefits. Similarly, none of the funds accumulated to provide the retirement benefits set forth in this chapter may be used or diverted to provide medical benefits under RSA 100-A:52-a. The funds, if any, providing medical benefits under RSA 100-A:52-a may be invested pursuant to the provisions of RSA 100-A:15.

13 New Paragraph; New Hampshire Retirement System; Medical Benefits; Application. Amend RSA 100-A:55 by inserting after paragraph I-b the following new paragraph:

I-c. It is the intent of the legislature that future group I state employee members eligible after July 1, 2004 shall be included under the provisions of RSA 100-A:52-a only if the total cost of such inclusion can be terminally funded from the special account established in RSA 100-A:16, II (h).

14 Defense and Indemnification. Amend RSA 99-D:2 to read as follows:

99-D:2 Defense and Indemnification. If any claim is made or any civil action is commenced against a present or former officer, trustee, official, or employee of the state or any agency thereof, including members of the New Hampshire national guard and any justice of the district, municipal, probate, superior, or supreme court, or the clerks or bail commissioners thereof, or any harbor master appointed by the New Hampshire port authority, or officials and employees of the New Hampshire housing finance authority, or directors, officers, and employees of the Pease development authority, or directors, officers, and employees of the land and community heritage investment authority seeking equitable relief or claiming damages for the negligent or wrongful acts and the officer, trustee, official, or employee requests the state to provide representation for him or her, and the attorney general, or, in the case of a claim or civil action commenced against the attorney general, the governor and council, determines that the acts complained of were committed by the officer, trustee, official, or employee while acting within the scope of official duty for the state and that such acts were not wanton or reckless, the attorney general shall represent and defend such person with respect to such claim or throughout such action, or shall retain outside counsel to represent or defend such person, and the state shall defray all costs of such representation or defense, to be paid from funds not otherwise appropriated. In such case the state shall also protect, indemnify, and hold harmless such person from any costs, damages, awards, judgments, or settlements arising from the claim or suit. The attorney general or governor and council shall not be required to consider the request of such person that representation be provided for him or her unless within 7 days of the time such person is served with any summons, complaint, process, notice, demand, or pleading [he] the person shall deliver the original or a copy thereof to the attorney general or, in the case of an action against the attorney general, to the governor and council. As a condition to the continued representation by the attorney general and to the obligation of the state to indemnify and hold harmless, such officer, trustee, official, or employee shall cooperate with the attorney general in the defense of such claim or civil action. No property either real or personal of the state of New Hampshire shall be subject to attachment or execution to secure payment of or to satisfy any obligations of the state created under this chapter. Upon the entry of final judgment in any action brought under this chapter, the governor shall draw [his] a warrant for said payment out of any money in the treasury not otherwise appropriated, and said sums are hereby appropriated. The attorney general shall have the authority to settle any claim brought under this chapter by compromise and the amount of any such settlement shall be paid as if the amount were awarded as a judgment under this chapter. Indemnification by the state under this section shall be for the actual amount of costs, damages, awards, judgments, or settlements personally incurred by any such officer, trustee, official, or employee, and the state shall not pay any amounts for which payment is the obligation of any insurance carrier or company under a policy or policies of insurance or any other third party under a similar obligation.

15 New Subparagraphs; Additional Powers and Duties. Amend RSA 227-M:5, VIII by inserting after subparagraph (c) the following new subparagraphs:

(d) Employ or retain as independent contractors architects, engineers, attorneys, accountants, and other advisors and employees, consultants, and agents as may be necessary in its judgment without regard to any personnel or civil service law of the state to prescribe their duties and qualifications and to fix and pay their compensation if any.

(e) Appoint qualified individuals to serve as unpaid volunteers under such terms and conditions as it deems necessary. Said volunteers or advisors may be paid a stipend and/or reimbursed for any incidental expenses determined by the authority to be necessary and incurred while performing the business of the authority.

16 New Section; Administrative Fund Established. Amend RSA 227-M by inserting after section 7 the following new section:

227-M:7-a Administrative Fund.

I. There is established in the office of the state treasurer a fund to be known as the land and community heritage investment program administrative fund into which the state treasurer shall credit any revenue generated pursuant to RSA 261:97-b, I-a. For the biennium ending June 30, 2003 there shall also be deposited, on a monthly basis, interest income generated on appropriations made to the land and community heritage investment program trust fund pursuant to RSA 227-M:7. If the revenues generated to the administrative fund from these two sources for said biennium do not total $335,000 during each year of the biennium, then, on or after the first day of the last month of the fiscal year, the treasurer shall be authorized to credit the administrative fund from the principal of the trust fund, not to exceed this total.

II. All sums so credited shall be appropriated to the authority for the following purposes:

(a) To pay the costs of administering and operating the authority, including, but not limited to, all wages, salaries, benefits, and other expenses authorized by the board or the executive director. The authority may enter into a contract or agreement for provision of services to withhold on a monthly basis all payroll and benefit costs for employees.

(b) In general for the payment of all expenses incident to the management and operation of the authority as are consistent with its statutory purpose and as the board or the executive director thereof may from time to time determine.

III. This fund shall constitute a continuing appropriation for the benefit of the authority. Any amount remaining to the credit of the authority at the close of any fiscal year, and any interest accrued, shall be nonlapsing and shall be carried over and credited to the fund for the succeeding year.

17 New Section; Land and Community Heritage Investment Program; Authority Employees. Amend RSA 227-M by inserting after section 6 the following new section:

227-M:6-a Status of Employees.

I. The authority may hire, fix and pay compensation, prescribe duties and qualifications, and establish personnel policies without regard to any personnel or civil service law or personnel or civil service rule of the state. The employees of the authority shall not be classified employees of the state within the meaning of RSA 21-I:49. Any individual employed by the authority shall be deemed an employee at will and shall serve at the pleasure of the authority.

II. Notwithstanding the provisions of paragraph I, any individual employed by the authority whose employment calls for 30 hours or more work in a normal calendar week, and whose position is anticipated to have a duration of 6 months or more, shall be entitled to elect to receive such health, dental, life insurance, deferred compensation, and retirement benefits as are afforded to classified employees of the state provided, however, that the election is made in writing within 30 days of the start of employment. Upon election by such individual, the authority shall pay from its revenues the state's share of such benefits. Any remaining costs of health, dental, life insurance, deferred compensation, and retirement benefits which an individual elects to receive pursuant to this section, shall be withheld from such individual's salary as a payroll deduction. Written notice of the availability of these benefit options shall be provided to each individual upon employment by the authority.

18 Department of Resources and Economic Development; Telecommunications Planning and Development Initiative; Initial Funding; Appropriation Nonlapsing. Amend 2000, 298:5 by inserting after paragraph IV the following new paragraph:

V. The initial funding mechanism and the appropriation made pursuant to this section shall not lapse until June 30, 2002.

19 Authority to Fill Unfunded Positions; Department of Health and Human Services. Notwithstanding any other provision of law, the commissioner of the department of health and human services may fill any authorized unfunded positions during the biennium ending June 30, 2003, provided that the total expenditures shall not exceed the amount appropriated for personal services, permanent and personal services, unclassified.

20 Certain Tobacco Use Prevention Fund Moneys; General Fund. Notwithstanding any provision of law to the contrary, $1,500,000 from the tobacco use prevention fund, established in RSA 126-K:15, shall lapse to the general fund on July 1, 2001.

21 Effective Date.

I. Sections 11 and 12 of this act shall take effect 60 days after its passage.

II. Section 13 of this act shall take effect January 1, 2002.

III. Section 18 of this act shall take effect June 30, 2001.

IV. The remainder of this act shall take effect July 1, 2001.