HB1512 (2010) Detail

(New Title) establishing a deferred retirement option in the judicial retirement plan.


HB 1512 – AS AMENDED BY THE SENATE

10Feb2010… 0394h

05/12/10 2057s

05/12/10 2054s

2010 SESSION

10-2665

10/09

HOUSE BILL 1512

AN ACT establishing a deferred retirement option in the judicial retirement plan, and relative to the determination of the cost of purchasing prior service credit in the state retirement system.

SPONSORS: Rep. Wall, Straf 7

COMMITTEE: Executive Departments and Administration

AMENDED ANALYSIS

This bill allows judges who resign from office to elect to receive a deferred retirement benefit under the judicial retirement plan. The bill also clarifies the method for determining the cost of purchasing prior service credit in the state retirement system.

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Matter which is either (a) all new or (b) repealed and reenacted appears in regular type.

10Feb2010… 0394h

05/12/10 2057s

05/12/10 2054s

10-2665

10/09

STATE OF NEW HAMPSHIRE

In the Year of Our Lord Two Thousand Ten

AN ACT establishing a deferred retirement option in the judicial retirement plan, and relative to the determination of the cost of purchasing prior service credit in the state retirement system.

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

1 New Paragraph; Judicial Retirement Plan; Deferred Retirement Benefit. Amend RSA 100-C:5 by inserting after paragraph VII the following new paragraph:

VIII. Any member who resigns from office on or after January 1, 2010, and who has at least 7 years of creditable service, may collect a vested deferred retirement allowance beginning at an age and years of service at which the member would otherwise have been eligible to retire pursuant to paragraphs I through IV. The member shall submit a written application to the board setting forth on what date, not less than 30 days nor more than 90 days subsequent to the filing of the application, the member desires to begin deferred retirement. Upon deferred retirement, the member’s deferred retirement allowance shall equal that percentage of the member’s final year’s salary before resigning that the member would have received pursuant to paragraphs I through IV if the member had served until retirement at the age at which the member’s deferred retirement begins with the number of years of creditable service earned by the member before resigning. In lieu of receiving a vested deferred retirement allowance, the resigning member may at any time exercise the member’s rights under RSA 100-C:8 for a return of the member’s accumulated contributions.

2 Retirement System; Membership; Prior Service Credit; Cost of Purchase. 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 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 based on the interest rates in effect for each fiscal year. [The amount determined by the actuary to purchase prior service credit related to Peace Corps and AmeriCorps service shall be computed under RSA 100-A:4, VIII.] For [all other] any prior service credit purchase 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] payment of the full accrued actuarial cost to the system. The full actuarial cost of service credit purchases shall be determined by the actuary based on methods and assumptions recommended by the actuary and approved by the board of trustees, and shall include an interest rate 2 percentage points less than either the assumed rate of return determined under RSA 100-A:16, II(h) or the actual rate of return, whichever is lower, for the immediately preceding fiscal year as reported in the comprehensive annual financial report (CAFR), provided the rate shall not be less than zero.

3 Membership; Cost of Prior Service Credit. Amend RSA 100-A:3, VI(d)(1) to read as follows:

(d)(1) In the case of an employer which through its own fault, and not the fault of the employee, failed to enroll an eligible employee at the time such employee became eligible for membership in this retirement system or a predecessor system, the employer and not the employee shall pay the cost of the actuary’s statement obtained under this subparagraph. The actuary’s statement shall be based on 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. In addition, if such employee has not received final approval of the board before July 1, 1989, to receive credit for such service, the employer shall pay 1/2 of the amount determined by the actuary and the employee shall pay ½] payment of the full accrued actuarial cost to the system as determined according to RSA 100-A:3, VI(b). Upon payment, and with the approval of the board, the member shall receive credit for prior service. The amount paid by the employee for prior service credit under this subparagraph shall be credited to the member annuity savings fund, and the amount paid by the employer shall be credited to the state annuity accumulation fund.

4 Creditable Service; Armed Forces Service; Cost of Prior Service Credit. Amend RSA 100-A:4, VI(b) to read as follows:

(b) Credit for active service in the armed services shall not be made until the member has paid either in lump sum or, if permitted by the board of trustees, by installment deductions from pay from an employer. The actuary’s statement 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] based on the payment of the full accrued actuarial cost to the system as determined according to RSA 100-A:3, VI(b).

5 Judges of Probate; Retirement Due to Disability; Surviving Spouse. Amend RSA 547:19-a to read as follows:

547:19-a Retirement Due to Disability; Surviving Spouse. Notwithstanding any other provisions of law, any judge of probate who is not a full-time judge covered by RSA 100-C and who shall become unable to perform his or her duties because of permanent disability shall be retired from regular active service on the bench for the remainder of his or her term to age 70. Any such judge who desires to retire because of inability to perform his or her duties shall certify to the governor and council his or her disability to perform [his] those duties. If they find him or her unable to perform [his] those duties because of permanent disability, the governor and council shall order [his] the judge’s retirement from regular active service. If a judge of probate who is not a full-time judge covered by RSA 100-C and who is permanently disabled to perform his or her duties shall be unable or unwilling to certify his or her disability, any 3 justices of the probate court shall certify in writing [his] such judge’s disability to the governor and council, who shall, if they find [him] the judge after due notice and hearing, unable to perform his or her duties because of permanent disability, order his or her retirement from regular active service. The governor and council upon retirement of any such judge of probate as provided herein shall appoint a successor [to serve out the remainder of the term]. Any judge of probate who is not a full-time judge covered by RSA 100-C and who has served in such capacity for a period of at least 10 years in said office, and retired from regular active service because of permanent disability, shall receive during the remainder of his or her term a salary equal to one-half the salary being paid to [him] the judge at the time of [his] retirement, except in case of [his] such judge’s election to take other retirement benefits as hereinafter provided. If a judge of probate who is not a full-time judge covered by RSA 100-C dies while serving in such capacity or while on disability retirement from such capacity as provided in this section, his or her surviving spouse shall receive during the remainder of said probate judge’s term a payment equal to one-half the salary of said probate judge at the time of death or such disability retirement, except in case of the probate judge electing to take other retirement benefits as hereinafter provided. Any judge retired from active regular service under the provisions hereof who is also a member of the state employees’ retirement system or the New Hampshire retirement system shall be entitled to retire with disability benefits under either of said systems, upon notification to the retirement board. If, however, said judge elects to take payments under the provisions of this section he or she shall thereby forfeit all rights to any benefits provided under said employees’ or New Hampshire retirement system.

3 Effective Date. This act shall take effect upon its passage.