hb 1302

CHAPTER 140

HB 1302-FN - FINAL VERSION

AN ACT relative to the purchase of certain prior service credit by members of the retirement system, relative to legislative review of retirement fund investment practices, and relative to the payment of medical benefits costs for retired state employees.

SPONSORS: Rep. Pepino, Hills 40; Rep. Baroody, Hills 42; Rep. Marshall Quandt, Rock 20

I. Allows for retirement system members who have prior service for which accumulated contributions were withdrawn to purchase a partial amount of such prior service.

II. Removes requirements for legislative review of the investment practices of the retirement system assets.

III. Eliminates a biennial report to the legislature on the status of the retirement system.

IV. Changes the date of the application of certain provisions providing for the payment by the retirement system and the state of the cost of medical benefits for retired state employees.

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Matter which is either (a) all new or (b) repealed and reenacted appears in regular type.

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

140:1 Retirement System; Membership; Purchase of Prior Service. Amend RSA 100-A:3, VI(b) to read as follows:

(b) In the case of prior service credit for time served as a member for which the member's accumulated contributions have been withdrawn, the amount of creditable service purchased may be the full length of service relating to the withdrawn contributions or a partial share of such service. The amount determined by the actuary [~~shall be the amount withdrawn plus~~] to reinstate full or partial service credit shall be the amount of withdrawn contributions, but not less than one month's contributions multiplied by the ratio of the service credit to be purchased to the full length of service relating to the withdrawn contributions, with this amount adjusted for interest from the date of withdrawal to the date of payment [~~for prior service credit at a rate to be determined by the board of trustees~~] based on the interest rates in effect for each fiscal year. For all other prior service credit the amount determined by the actuary shall be the product of the member's annual rate of compensation at the time of buy-in, multiplied by the sum of the member and employer contribution rates in effect with respect to the member at the time of buy-in, multiplied by the number of years of prior service credit bought.

140:2 Management of Funds; Review by Legislature. Amend RSA 100-A:15, VIII to read as follows:

VIII. The management, investment, and reinvestment practices for the assets held in trust by the board pursuant to this section shall be subject to review by the legislature [at least every 5 years. The review by the legislature, after acceptance by the general court, shall be published in the next comprehensive annual investment report of the retirement system. The legislative budget assistant shall inform the speaker of the house and the president of the senate when review is required under this paragraph. The legislative budget assistant shall also monitor compliance by the retirement system of the inclusion of any and all written reviews in the comprehensive annual investment report].

140:3 Retirement System; Administration; Report to Legislature. Amend RSA 100-A:14, IX to read as follows:

IX. In 1970, and at least once in each 5-year period thereafter, the board shall have an actuary make an actuarial investigation into the mortality, service and compensation experience of the members and beneficiaries of the retirement system, and a valuation of the assets and liabilities of its funds, and taking into account the result of such investigation and valuation, the board shall adopt such mortality, service and other tables as shall be deemed necessary, and certify the rates of contribution payable under the provisions of this chapter. [Commencing in the year 1971, and at 2-year intervals thereafter, the board shall report to the legislature by January 15 on the status of the system and the desirability of any change including a change in rates for members and employers on the basis of the then accumulated experience of the system. ]

140:4 Retirement System; State Employees; Medical Benefits; Date Changed. Amend RSA 100-A:52-b, V and VI to read as follows:

V. As of [~~January 1, 2002~~] July 1, 2001, 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.

VI. As of [~~January 1, 2002~~] July 1, 2001, 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 III, 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.

II. The remainder of this act shall take effect May 10, 2002)