CHAPTER 90
SB 371 – FINAL VERSION
2008 SESSION
10/03
SENATE BILL 371
AN ACT making various changes to the city of Manchester employees’ contributory retirement system.
SPONSORS: Sen. D'Allesandro, Dist 20; Rep. F. Sullivan, Hills 12
COMMITTEE: Public and Municipal Affairs
This bill amends the Manchester employees’ contributory retirement system as follows:
I. Defining spouse to include civil unions.
II. Removing a reference to the finance director.
III. Establishing a minimum participation standard for members in order to ensure that only employees working sufficient hours are enrolled.
IV. Repealing the workers’ compensation offset provisions applied against disabled participants.
V. Clarifying the tax treatment of contributions by members.
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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Matter which is either (a) all new or (b) repealed and reenacted appears in regular type.
08-2639
10/03
STATE OF NEW HAMPSHIRE
In the Year of Our Lord Two Thousand Eight
AN ACT making various changes to the city of Manchester employees’ contributory retirement system.
Be it Enacted by the Senate and House of Representatives in General Court convened:
90:1 New Paragraph; Manchester Employees’ Contributory Retirement System; Spouse. Amend 1973, 218:4 as amended by 2002, 194:1 by inserting after paragraph XX the following new paragraph:
XXI. “Spouse” means a person’s husband or wife married or recognized pursuant to New Hampshire law. A party to a civil union under RSA 457-A, shall be included in any definition or use of the term “spouse,” “dependent,” “widow,” or “widower” and other terms that denote the spousal relationship in this act.
90:2 Board Duties; Reference Removed. Amend the introductory paragraph of 1973, 218:6, I as amended by 2002, 194:1 to read as follows:
I. Contributions received by the retirement system pursuant to this act shall be deposited into the retirement fund[. The finance director of the city shall be the treasurer of the retirement fund] which shall be a trust. The retirement board shall be trustee of the retirement fund and shall have the obligation of a fiduciary of the retirement system and its members and beneficiaries. In the fulfillment of its duties and responsibilities hereunder, the retirement board shall act solely in the interests of the retirement system, the members, and the beneficiaries and with the care, skill, prudence, and diligence under the circumstances then prevailing that a prudent person acting in a like capacity and familiar with such matters would use in the conduct of an enterprise of a like character and with like aims. As trustee, the retirement board shall hold legal title to all securities and assets of the retirement system and shall have full control and management of them with the power to invest and reinvest the same in accordance with the terms, conditions, limitations, and restrictions imposed by the general statutes of the state of New Hampshire governing the investment of trust funds. In addition to those powers, the retirement board, as trustee, shall also have the power:
90:3 Employee Eligibility. Amend 1973, 218:7 as amended by 2002, 194:1 and 2005, 40:1 to read as follows:
218:7 Employees to Whom the Act Applies.
I. [All full-time and permanent part-time] Eligible employees of the city, including elected and appointed officials of the city, shall participate in the retirement system and receive benefits as provided by the act. For purposes of this act, employees of the Manchester school district, Manchester public library, and the Manchester contributory retirement system shall be city employees. Participation in the retirement system shall be a condition of employment with the city. The following employees of the city shall not be eligible to participate in the retirement system:
(a) Temporary employees;
(b) Members of boards and commissions who are not [part-time or full-time employees of] otherwise eligible as a result of employment by the city;
(c) Members of the fire and police departments who are eligible to participate in a state-administered retirement system;
(d) Persons who are eligible to participate in the New Hampshire retirement system[.]; and
(e) Trustees of the Manchester contributory retirement system who are not otherwise eligible as a result of employment by the city.
II. Temporary employees of the city who become [permanent employees] eligible to participate under paragraph IV without incurring a break in service are eligible to participate in the retirement system as of their original date of hire if they complete a service buyback.
III. Any eligible employee in the employment of the city on January 1, 1974, who elected not to participate shall only be admitted to the retirement system upon completion of an application for participation, majority consent of the retirement board, passing a prescribed physical examination, and completion of a service buyback.
IV. Employees shall become eligible to participate as follows:
(a) Employees of the city shall be eligible if they are employed 32 hours or more per week on a regularly scheduled basis of principal employment wherein the employee meets criteria established by the city for at least one other employee benefit, limited to vacation/sick leave pay or health insurance benefits, except that where no other benefits are provided, an employee shall be eligible based solely on 32 hours or more per week of employment; and
(b) Manchester school district employees shall be eligible if contracted for at least 30 hours per week, for a minimum of 180 days, except in the case of school food and nutrition staff who must work 20 hours per week, for a minimum of 180 days.
V. Any member whose hourly work status is subsequently reduced to a level below the minimum participation standards established in subparagraph IV(a) or (b), shall be ineligible for continued membership participation. Any member who remains in such status for a period of 90 days, and who has less than 5 years’ accrued service, shall be entitled to receive a refund of accumulated contributions pursuant to section 11.
VI. Any member with more than 5 years of service, who continues to be ineligible for participation after the initial 90 day period described in paragraph IV, shall automatically be entitled to a vested deferred retirement allowance, as provided by paragraph II of section 11. In lieu of a monthly retirement benefit, such member may elect to receive a refund of accumulated contributions pursuant to paragraph I of section 11.
VII. Any employee who re-qualifies for membership by meeting the minimum participation standards provided in subparagraph IV(a) or (b) and who received a refund of accumulated contributions pursuant to paragraph V, may restore full service credit by reinstating the funds in accordance with paragraph III of section 10. Upon re-qualification for membership by an employee with 5 or more years of service, any notice of intention to receive a vested deferred retirement benefit form filed in accordance with paragraph II of section 11, shall be considered invalid.
VIII. Any actively contributing member of the system as of January 1, 2008 shall continue to be eligible for membership in the Manchester employees’ contributory retirement system and shall not be affected by paragraph IV. Any such member who meets the qualifications established in paragraph IV, who later experiences a reduction in hours below the standards established in paragraph IV, shall be disqualified from continued participation. Any member who remains in that status for a period of 90 days shall then be entitled to either a vested deferred retirement benefit or a refund of contributions as outlined in paragraphs V or VI.
90:4 Contributions. Amend 1973, 218:9, II as amended by 2002, 194:1 to read as follows:
II.(a) The earnings of each member participating in the retirement system shall be reduced by the contribution rate set forth in this section. Such contribution shall be transmitted immediately to the retirement board.
(b) All contributions required to be made under this section with respect to services rendered by an active member on or after January 1, 1986, shall be picked up by the city and shall be treated as an employer’s contribution in determining tax treatment under Internal Revenue Code section 414(h)(2). For all other purposes, under this act and otherwise, such pickup contributions shall be treated as contributions made by a member prior to January 1, 1986. The city shall pay such picked up amounts from the same source of funds which is used in paying earnings to the employee.
90:5 Repeal. 1973, 218:15, VI, as amended by 2002, 194:1, relative to worker’s compensation offset provisions applied to disabled participants, is repealed.
90:6 Effective Date.
I. Section 3 of this act shall take effect 90 days after its passage.
II. The remainder of this act shall take effect 30 after its passage.
Approved: May 21, 2008
Effective Date: I. Section 3 shall take effect August 19, 2008.
II. Remainder shall take effect June 20, 2008.