SB 148-FN – AS AMENDED BY THE SENATE
03/29/07 1000s
2007 SESSION
10/04
SENATE BILL 148-FN
AN ACT relative to retirement system status for members of the university system police force.
SPONSORS: Sen. Downing, Dist 22; Sen. D'Allesandro, Dist 20; Rep. Winchell, Rock 6; Rep. Pearson, Rock 4
COMMITTEE: Executive Departments and Administration
This bill defines permanent police for purposes of the New Hampshire retirement system to include the university system police force, and allows university system police force members to purchase certain service as group II service.
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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Matter which is either (a) all new or (b) repealed and reenacted appears in regular type.
03/29/07 1000s
07-1222
10/04
STATE OF NEW HAMPSHIRE
In the Year of Our Lord Two Thousand Seven
AN ACT relative to retirement system status for members of the university system police force.
Be it Enacted by the Senate and House of Representatives in General Court convened:
1 Retirement System; Definition of Employer. Amend RSA 100-A:1, IV to read as follows:
IV. “Employer” shall mean (a) 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 with respect to their employees, (b) the state, the local school district, or other employers of teachers eligible for membership in the system with respect to the teachers in their employ, (c) any police department or police force of the state, or any police department of the university system, or of any county, city, town, village, or precinct in the state with respect to the permanent policemen in their employ, (d) any fire department of the state, or of any county, city, town, village, or precinct in the state with respect to the permanent firemen in their employ, and (e) any political subdivision that has elected to participate under RSA 100-A:20; provided, however, that in no instance shall any employer contribute or participate in the retirement system unless by a reasonable determination of the board of trustees such employer qualifies as a governmental entity, political subdivision, agency, or instrumentality eligible to participate in the retirement system as a governmental plan within the meaning of section 414(d) of the United States Internal Revenue Code of 1986, as amended.
2 Retirement System; Definition of Permanent Policeman. Amend the introductory paragraph of RSA 100-A:1, VII to read as follows:
VII. “Permanent policeman,” for the purposes of membership in group II and other provisions of this chapter, shall mean any person, whether elected or appointed, who is regularly employed on a full-time basis by the state in a job certified by the director of personnel as conforming to the requirements of this paragraph, or by any of its political subdivisions in a job certified by the governing body of the political subdivision as conforming to the requirements of this paragraph, or by the university system of New Hampshire in a job certified by the university system board of trustees as conforming to the requirements of this paragraph, which job shall be in one of the following categories:
3 New Paragraph; Membership. Amend RSA 100-A:3 by inserting after paragraph I-a the following new paragraph:
I-b.(a) Notwithstanding the provisions of 1963, 303: 11, III, any person in the employ of the university system of New Hampshire as a police officer who meets the definition of permanent policeman shall become a member of the retirement system as a condition of employment; except, that membership shall be optional for any such permanent policeman who is in the service of the university system of New Hampshire as of the effective date of this paragraph.
(b) A permanent policeman for whom membership is optional who elects to join the retirement system within one year of the effective date of this paragraph may purchase group II service for services performed as a police officer of the university system of New Hampshire police department if such service meets the definition of permanent policeman. The cost of purchasing such service shall be the product of the member’s annual rate of compensation at the time of the purchase, multiplied by the sum of the member and employer contribution rates in effect with respect to the member at the time of the purchase, multiplied by the number of years of prior service credit being bought. In no event, however, shall prior service purchased as creditable service under this section be used as creditable service for the purpose of eligibility for medical benefits under RSA 100-A:52, RSA 100-A:52-a, or RSA 100-A:52-b.
4 Effective Date. This act shall take effect 60 days after its passage.
LBAO
07-1222
Amended 04/11/07
SB 148 FISCAL NOTE
AN ACT relative to retirement system status for members of the university system police force.
FISCAL IMPACT:
The University System of New Hampshire indicates this bill, as amended by the Senate (Amendment #2007-1000s), will increase state expenditures by $114,926 in FY 2008, $114,926 in FY 2009, and by an indeterminable amount in FY 2010 and each year thereafter. There is no fiscal impact on county and local expenditures or state, county, and local revenue.
METHODOLOGY:
The University System of New Hampshire (USNH) and the New Hampshire Retirement System (NHRS) state this bill will allow university system police force members to become Group II members of the NHRS and allow the members to purchase up to five years of Group II service. This bill will impact 25 individuals. The USNH assumes all university system police force members will choose the option to become a Group II member. The USNH contributes a maximum of eleven percent to its 403(b) retirement plan for its police force members. If the USNH is required to pay the entire 18.21 percent contribution rate (effective July 1, 2007) for its Group II members, the USNH will have additional costs of 7.21 percent of each dollar of eligible base salary plus the full 18.21 percent on all overtime pay, which is not included in USNH retirement contribution base. The USNH states its costs associated with retirement will increase from $222,256 to $337,182, an increase of $114,926 in FY 2008 and FY 2009. The USNH does not determine the fiscal impact beyond FY 2009 citing concerns there may be significant rate increases to address the underfunding of the NHRS.
The NHRS’s actuary assumes an 8.5 percent rate of interest, wage inflation of 5.5 percent, and all 25 members will purchase the maximum amount allowable of Group II service. The actuary states the fiscal year 2007 employer contribution rate of 14.90 percent for police members is sufficient to fund future benefits of the members to be added from the USNH.