Revision: May 4, 2011, midnight
SB 3-FN-A-LOCAL – AS AMENDED BY THE HOUSE
03/16/11 0701s
03/16/11 0797s
03/16/11 0905s
03/30/11 1221s
4May2011… 1576h
4May2011… 1710h
2011 SESSION
10/03
SENATE BILL 3-FN-A-LOCAL
AN ACT relative to the New Hampshire retirement system, and relative to continuation of provisions of a collective bargaining agreement following the end of the term of the agreement.
SPONSORS: Sen. Bradley, Dist 3; Sen. Barnes, Jr., Dist 17; Sen. Bragdon, Dist 11; Sen. De Blois, Dist 18; Sen. Forrester, Dist 2; Sen. Forsythe, Dist 4; Sen. Gallus, Dist 1; Sen. Groen, Dist 6; Sen. Luther, Dist 12; Sen. Odell, Dist 8; Sen. Rausch, Dist 19; Sen. White, Dist 9; Rep. Hawkins, Hills 18; Rep. Kurk, Hills 7; Rep. Reagan, Rock 1; Rep. Bettencourt, Rock 4
COMMITTEE: Executive Departments and Administration
AMENDED ANALYSIS
This bill makes various changes to the state retirement system including:
I. Increasing retirement ages of group I and group II members for service retirement, disability retirement, vested deferred retirement, and split benefits.
II. Changing the definitions of earnable compensation and average final compensation used in calculating retirement benefits.
III. Changing the composition of the board of trustees.
IV. Eliminating the special account.
V. Increasing contribution rates.
VI. Establishing a committee to study the establishment of a voluntary defined contribution plan.
VII. Modifying optional membership in the retirement system.
VIII. Limiting participation based on part-time employment, defining part time employment for purposes of the New Hampshire retirement system, and prohibiting members in retirement from returning to full-time employment.
This bill also establishes a program allowing a state employee to refuse his or her rights as a state employee to receive state medical, dental, and retirement benefits in order to instead receive an increase in his or her base salary or wage; and provides that after the end of a collective bargaining agreement, the public employer has exclusive authority for continuation of benefits.
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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Matter which is either (a) all new or (b) repealed and reenacted appears in regular type.
03/16/11 0701s
03/16/11 0797s
03/16/11 0905s
03/30/11 1221s
4May2011… 1576h
4May2011… 1710h
11-0951
10/03
STATE OF NEW HAMPSHIRE
In the Year of Our Lord Two Thousand Eleven
AN ACT relative to the New Hampshire retirement system, and relative to continuation of provisions of a collective bargaining agreement following the end of the term of the agreement.
Be it Enacted by the Senate and House of Representatives in General Court convened:
1 Findings and Intent.
I. It is imperative for the state to take immediate action to assure the state retirement system’s future financial health.
(a) The Pew Institute has concluded that unfunded pension and health care liabilities are a nationwide problem, estimated at over $1 trillion.
(b) The New Hampshire retirement system has an estimated unfunded pension liability of $3.7 billion and $1.5 billion of unfunded medical insurance liability. Although a plan is underway for recovery over 30 years, uncertainties in future market returns, rapid increases in medical costs, increases in life expectancy, and slower growth in public sector employment require prudent intervention to assure financial viability.
(c) The level of federal debt of almost $14 trillion and growing rapidly suggests that federal assistance to the states may be significantly reduced in the future, adding to the problem.
(d) The budget reductions planned for the state fiscal years 2012 and 2013 are large, and do not fully meet the state’s commitments to health and human services, education, transportation, and other services. Reductions in state retirement costs are a necessary part.
II. The current level of benefits for public employees is unsustainable.
(a) On average, benefits constitute an additional 52 percent increase to the cost of public salaries. This is significantly higher than the percent paid in the private sector, and taxpayers are increasing unable to continue this level of support, especially in our recessionary climate.
(b) Public employees are increasingly not cost-competitive with private alternatives to providing state and municipal services.
(c) Public employee contributions to their pensions have not been increased for many years.
III. The financial viability of the state retirement system must be preserved.
(a) Simply shifting who pays (i.e., employees or employers) will not solve the problem.
(b) It is important to adjust the system fairly among employee classes, and to introduce changes in a way to ameliorate impact on present employees, especially those closest to retirement.
(c) Pension costs must not make public employees uncompetitive with the private sector.
2 Retirement System; Definition of Earnable Compensation. Amend RSA 100-A:1, XVII to read as follows:
XVII. “Earnable compensation’’ shall mean:
(a) For all members in service on or before June 30, 2011 and who retire prior to July 1, 2016, the full base rate of compensation paid plus any overtime pay, holiday and vacation pay, sick pay, longevity or severance pay, cost of living bonus, additional pay for extracurricular and instructional activities or for other extra or special duty, and any military differential pay, plus the fair market value of non-cash compensation paid to, or on behalf of, the member for meals or living quarters if subject to federal income tax, but excluding other compensation except cash incentives paid by an employer to encourage members to retire, supplemental pay paid by the employer while the member is receiving workers’ compensation, and teacher development pay that is not part of the contracted annual salary. However, earnable compensation in the final 12 months of creditable service prior to termination of employment shall be limited to 1- 1/2 times the higher of the earnable compensation in the 12-month period preceding the final 12 months or the highest compensation year as determined for the purpose of calculating average final compensation, but excluding the final 12 months. Any compensation received in the final 12 months of employment in excess of such limit shall not be subject to member or employer contributions to the retirement system and shall not be considered in the computation of average final compensation. Provided that, the annual compensation limit for members of governmental defined benefit pension plans under section 401(a)(17) of the United States Internal Revenue Code of 1986, as amended, shall apply to earnable compensation for all employees, teachers, permanent firemen, and permanent policemen who first become eligible for membership in the system on or after July 1, 1996. Earnable compensation shall not include compensation in any form paid later than 120 days after the member’s termination of employment from a retirement eligible position, with the limited exceptions of disability related severance pay paid to a member or retiree no later than 120 days after a decision by the board of trustees granting the member or retiree disability retirement benefits pursuant to RSA 100-A:6 and of severance pay which a member was entitled to be paid within 120 days after termination but which, without the consent of the member and not through any fault of the member, was paid more than 120 days after the member’s termination. The member shall have the burden of proving to the board of trustees that any severance payment paid later than 120 days after the member’s termination of employment is earnable compensation and meets the requirements of an asserted exception to the 120-day post-termination payment requirement.
(b) For any member in service on and after July 1, 2011 and who retires after July 1, 2016, the full base rate of compensation paid plus holiday pay, vacation pay, and sick pay, and any compensation for mandatory training and any military differential pay. Earnable compensation shall not include pay for accumulated unused sick or vacation time. However, earnable compensation in the final 2 12-month periods of creditable service prior to termination of employment shall each be limited to 1-1/2 times the highest compensation year as determined for the purpose of calculating average final compensation, but excluding the final 24 months. Any compensation received in the final 24 months of employment in excess of such limit shall not be subject to member or employer contributions to the retirement system and shall not be considered in the computation of average final compensation. Provided that, the annual compensation limit for members of governmental defined benefit pension plans under section 401(a)(17) of the United States Internal Revenue Code of 1986, as amended, shall apply to earnable compensation for all employees, teachers, permanent firemen, and permanent policemen. Earnable compensation shall not include compensation in any form paid later than 120 days after the member’s termination of employment from a retirement eligible position.
3 Retirement System; Definitions; Average Final Compensation. Amend RSA 100-A:1, XVIII to read as follows:
XVIII. “Average final compensation” shall mean, for members who retire prior to July 1, 2016, the average annual earnable compensation of a member during his or her highest 3 years of creditable service, or during all of the years in his or her creditable service if less than 3 years. For members who retire on or after July 1, 2016, “average final compensation” shall mean the average annual earnable compensation of a member during his or her highest 5 years of creditable service, or during all of the years in his or her creditable service if less than 5 years.
4 New Section; Retirement Qualification Age and Benefit Calculation Tables. Amend RSA 100-A by inserting after section 1 the following new section:
100-A:1-a Retirement Qualification Age and Benefit Calculation Tables. Where applicable the following tables shall apply to group I and group II members for the purpose of determining the member’s retirement qualification age, years of service, and benefit calculation:
I. Group I.
Creditable service on July 1, 2011 Retirement qualification age Multiplier
Less than 10 years 65, subject to paragraph III 1/66
At least 10 but not 15 years 64 1/64
At least 15 but not 20 years 63 1/63
At least 20 but not 25 years 62 1/62
At least 25 but not 30 years 61 1/61
At least 30 years 60 1/60
II. Group II.
Creditable service Minimum years of service Minimum age attained Annuity multiplier
on July 1, 2011
0 years/ new hire 25 50, subject to paragraph III 2.0%
Less than 4 years 24 49 2.1%
At least 4 years but 23 48 2.2%
less than 6 years
At least 6 years but 22 47 2.3%
less than 8 years
At least 8 years but 21 46 2.4%
less than 10 years
10 years or more 20 45 2.5%
III. The regular retirement qualification age for group I members, and the group II minimum age attained for regular retirement as well as the minimum age to receive a group II retirement allowance under RSA 100-A:5, II(a) for such members, shall be subject to increase according to the following procedure:
(a) Beginning July 1, 2016 and on every subsequent 5-year anniversary thereafter, the executive director shall adjust the ages required according to the increase in the average life expectancy at birth for persons born in the United States as reported in that year by the United States Census Bureau. For each increase in such average life expectancy of at least one full year which occurred during the immediately preceding five-year period, the corresponding number of full years shall be added to the ages identified in this section. Any unused portion of a full-year increase in the average life expectancy shall be carried forward to the subsequent 5-year period.
(b) The board of trustees, following each such 5-year anniversary, shall certify the average life expectancy to be used by the executive director in adjusting the ages according to this section, and shall inform all employers and members of the changes to be applied.
5 New Section; Participation Standards; Classified State Employees. Amend RSA 100-A by inserting after section 28-b the following new section:
100-A:28-c Participation Standards; Classified State Employees.
I. In order to be eligible for participation in the retirement system, an employee as defined in RSA 100-A:1, V who is a classified employee of the state or of any department, commission, institution, or agency of the state government, must be employed in a full-time position with the state or a department, commission, institution, or agency of the state government, as defined by the department of administrative services, division of personnel. Employment by a classified employee in one or more part-time positions, as defined by the department of administrative services, division of personnel, shall not result in such employee’s participation in the system, regardless of the number of hours worked in one or more part-time positions, regardless of whether the part-time position or positions may in some instances qualify for vacation pay, sick pay, or other benefits, and regardless of whether positions are held within one or more departments, commissions, institutions, or agencies.
II. Employment by a full-time classified employee of any department, commission, institution, or agency of the state government in a part-time position with a different department, commission, institution, or agency of the state government shall not result in retirement contributions being made in regard to the part-time position, nor shall that position be considered for the purposes of the member’s participation in the retirement system.
III. Solely part-time state employment by a classified employee shall not entitle the person to benefits under this chapter or under RSA 21-I:30, RSA 21-I:30-a, or RSA 21-I:32.
IV. To the extent that any administrative rule of the New Hampshire retirement system is inconsistent with the provisions contained this section, the operation of that rule is hereby suspended.
6 State Employees; Group Insurance Benefits. Amend RSA 21-I:30, III to read as follows:
III. Any vested deferred state retiree may receive medical and surgical benefits under this section if the vested deferred state retiree is eligible. To be eligible, a group I vested deferred state retiree shall have at least 10 years of creditable service with the state if the employee’s service began prior to July 1, 2003 or 20 years of creditable service with the state if the employee’s service began on or after July 1, 2003 and a group II vested deferred state retiree shall have at least 20 years of creditable service with the state if the employee’s service with the state began on or after July 1, 2010. In addition, if the vested deferred state retiree is a member of group I, such retiree shall be at least [60 years of age] the retirement qualification age under RSA 100-A:1-a, I to be eligible. If the vested deferred state retiree is a member of group II, such retiree shall not be eligible until [20 years from the date of becoming a member of group II and shall be at least 45 years of age] meeting the retirement qualifications under RSA 100-A:1-a, II.
7 Service Retirement; Age Increased. Amend RSA 100-A:5 to read as follows:
100-A:5 Service Retirement Benefits.
I. Group I Members.
(a) Any group I member may retire on a service retirement allowance upon written application to the board of trustees setting forth at what time, not less than 30 days nor more than 90 days subsequent to the filing thereof, the member desires to be retired, provided the member at the time so specified for retirement has attained [age 60] the retirement qualification age under RSA 100-A:1-a, I and notwithstanding that during such period of notification the member may have separated from service. For the purposes of this section, a teacher member of group I who remains in service throughout a school year shall be deemed to be in service during July and August at the end of such school year.
(b) Upon service retirement, an employee member or teacher member of group I shall receive a service retirement allowance which shall consist of a member annuity which shall be the actuarial equivalent of the member’s accumulated contributions at the time of retirement, and a state annuity. Prior to the member’s attainment of age 65, the state annuity, together with the member annuity, shall be equal to [1/60 of the member’s average final compensation] the benefit multiplier under RSA 100-A:1-a, I multiplied by the number of years of creditable service. After attainment of age 65, the state annuity, together with the member annuity, shall be equal to 1/66 of the member’s average final compensation multiplied by the number of years of creditable service. Provided, however, that for members who were not in vested status on July 1, 2011, the number of years of his or her creditable service used to determine the retirement allowance under this subparagraph shall not exceed 33 years.
(c) Notwithstanding any other provision of law, any group I member who meets the requirements of RSA 100-A:10, I(a), and who has either completed at least 20 years of creditable service which, when combined with his age equals at least 70 years, or who has attained the age of 50, but not the [age of 60] retirement qualification age under RSA 100-A:1-a, I, may elect to retire and have benefits commence immediately as a reduced service retirement allowance upon written application to the board of trustees setting forth the time, not less than 30 days nor more than 90 days subsequent to the filing thereof, at which the member desires to have benefits commence. The service retirement allowance shall be determined in accordance with RSA 100-A:5, I(b) and shall be reduced, for each month by which the date on which benefits commence precedes the month after which the member attains [60 years of age] the retirement qualification age under RSA 100-A:1-a, I, by 1/8 of one percent if the member has 35 years or more of creditable service, by 1/4 of one percent if the member has 30 years but less than 35 years of creditable service, by 1/3 of one percent if the member has at least 25 years but less than 30 years of creditable service, by 5/12 of one percent if the member has at least 20 years but less than 25 years of creditable service, and by 5/9 of one percent if the member has less than 20 years of creditable service.
(d) [Repealed.]
II. Group II Members.
(a)(1) Any group II member in service who has attained [age 45 and completed 20] the retirement qualification age and attained the minimum years of creditable service under RSA 100-A:1-a, II, or who has attained age 60 regardless of the number of years of creditable service, may retire on a service retirement allowance upon written application to the board of trustees; provided however that a group II member who is not in vested status on July 1, 2011 may retire and receive a service retirement allowance beginning upon the attainment of age 55 upon written application to the board of trustees.
(2) [setting] The written application shall set forth at what time not less than 30 days nor more than 90 days subsequent to the filing thereof the member desires to be retired, notwithstanding that during such period of notification the member may have separated from service.
(b) Upon service retirement and attainment of the required age, a group II member shall receive a service retirement allowance which shall consist of:
(1) A member annuity which shall be the actuarial equivalent of his or her accumulated contributions at the time of retirement; and
(2) A state annuity which, together with his or her member annuity, shall be equal to [2-1/2 percent of his average final compensation] the annuity multiplier under RSA 100-A:1-a, II multiplied by the number of years of his or her creditable service [not in excess of 40 years] provided the product does not exceed 100 percent, and then multiplied by the member’s average final compensation. Provided, however, that for members who were not in vested status on July 1, 2011, the number of years of his or her creditable service used to determine the retirement allowance under this subparagraph shall not exceed 25 years.
(c)(1) Notwithstanding any provision of RSA 100-A to the contrary, any group II member who has retired on or after the effective date of this subparagraph after attaining the [age of 45 with at least 20] retirement qualification age and minimum years of creditable service under RSA 100-A:1-a, II shall receive a minimum annual service retirement allowance of $10,000. If such group II member has elected to convert the retirement allowance into an optional allowance for the surviving spouse under RSA 100-A:13, the surviving spouse shall be entitled to a proportional share of the $10,000.
(2) [Repealed.]
(3) [Repealed.]
8 Disability Retirement; Group I Age Increased. Amend RSA 100-A:6, I(b) to read as follows:
(b)(1) Upon ordinary disability retirement, the group I member who has attained [age 60] the retirement qualification age under RSA 100-A:1-a, I shall receive an ordinary disability retirement allowance which shall consist of a member annuity and shall be the actuarial equivalent of the member’s accumulated contributions at the time of his ordinary disability retirement, and a state annuity as follows:
(A) Prior to the member’s attainment of age 65, the state annuity, together with the member annuity, shall be equal to [1/60 of the member’s average final compensation] the benefit multiplier under RSA 100-A:1-a, I at the time of his or her ordinary disability retirement multiplied by the number of years of creditable service at the time of his or her ordinary disability retirement;
(B) After attainment of age 65, the state annuity, together with the member annuity, shall be equal to 1/66 of the member’s average final compensation at the time of his or her ordinary disability retirement multiplied by the number of years of creditable service at the time of his or her ordinary disability retirement;
(C) Regardless of age at disability, the ordinary disability retirement allowance shall not be less than 25 percent of the member’s average final compensation at the time of his or her disability retirement.
(2) Upon ordinary disability retirement, the group I member who has not attained [age 60] the retirement qualification age under RSA 100-A:1-a, I shall receive an ordinary disability retirement allowance which shall consist of: a member annuity which shall be the actuarial equivalent of the member’s accumulated contributions at the time of his ordinary disability retirement; and a state annuity which, together with the member annuity, shall be equal to 1.5 percent of the member’s average final compensation at the time of his ordinary disability retirement multiplied by the number of years of creditable service at that time of his ordinary disability retirement. However, regardless of age at disability, the ordinary disability retirement allowance shall not be less than 25 percent of the member’s average final compensation at the time of his or her disability retirement.
9 Ordinary Disability Retirement; Group II. Amend RSA 100-A:6, II(b) to read as follows:
(b) Upon ordinary disability retirement, the group II member shall receive an ordinary disability retirement allowance which shall consist of: a member annuity which shall be the actuarial equivalent of his or her accumulated contributions at the time of his or her ordinary disability retirement; and a state annuity which, together with his or her member annuity, shall be equal to [2-1/2 percent of his average final compensation] the annuity multiplier under RSA 100-A:1-a, II at the time of [his] ordinary disability retirement multiplied by the number of years of his or her creditable service [not in excess of 40 at the time of his ordinary disability retirement] provided the product does not exceed 100 percent, and then multiplied by the member’s average final compensation, provided, further, however, that such allowance shall not be less than 25 percent of the member’s final compensation at the time of his or her disability retirement. Provided, however, that for members who were not in vested status on July 1, 2011, the number of years of his or her creditable service used to determine the retirement allowance under this subparagraph shall not exceed 25 years.
10 Accidental Disability Retirement; Group I. Amend RSA 100-A:6, I(d) to read as follows:
(d)(1) Upon accidental disability retirement, the group I member who has attained [age 60] the retirement qualification age under RSA 100-A:1-a, I shall receive an accidental disability retirement allowance which shall consist of a member annuity and shall be the actuarial equivalent of the member’s accumulated contributions at the time of his accidental disability retirement, and a state annuity as follows:
(A) Prior to the member’s attainment of age 65, the state annuity, together with the member annuity, shall be equal to [1/60 of the member’s average final compensation] the benefit multiplier under RSA 100-A:1-a, I at the time of his or her accidental disability retirement multiplied by the number of years of creditable service at the time of his or her accidental disability retirement;
(B) After attainment of age 65, the state annuity, together with the member annuity, shall be equal to 1/66 of the member’s average final compensation at the time of his or her accidental disability retirement multiplied by the number of years of creditable service at the time of his or her accidental disability retirement;
(C) Regardless of age at disability, for a member who is in vested status on July 1, 2011, such allowance shall not be less than 50 percent of the member’s average final compensation at the time of his or her accidental disability retirement.
(2) Upon accidental disability retirement, the group I member who has not attained [age 60] the retirement qualification age under RSA 100-A:1-a, I shall receive an accidental disability retirement allowance which shall consist of: the member annuity which shall be the actuarial equivalent of the member’s accumulated contributions at the time of his accidental disability retirement; and a state annuity which, together with the member annuity, shall be equal to 50 percent of the member’s average final compensation at the time of his or her disability retirement.
11 Accidental Disability Retirement; Group II. Amend RSA 100-A:6, II(d) to read as follows:
(d)(1) Upon accidental disability retirement, the group II member who is in vested status before July 1, 2011, shall receive an accidental disability retirement allowance equal to 2/3 of his or her average final compensation at the time of [his] disability retirement, and the group II member who is not in vested status on July 1, 2011, shall receive an accidental disability retirement allowance equal to 1/2 of his or her average final compensation at the time of disability retirement.
(2) For any group II member who has more than 26-2/3 years of service, a supplemental disability retirement allowance shall be paid. Such supplement shall be equal to 2-1/2 percent of his or her average final compensation multiplied by the number of years of his or her creditable service in excess of 26-2/3 but not in excess of 40 years. Provided, however, that an accidental disability retirement allowance together with a supplemental disability retirement allowance, as provided in this subparagraph, shall not exceed 100 percent of the disability retiree’s average final compensation.
12 Vested Deferred; Group II Age Increased. Amend RSA 100-A:10, II(b) to read as follows:
(b) Upon the member’s attainment of [age 45, provided the member would then have completed 20] the retirement qualification age and attained the minimum years of creditable service under RSA 100-A:1-a, II, otherwise the subsequent date on which such [20] minimum years would have been completed, or at any time after age 60 a group II member who meets the requirement of subparagraph (a) may make application on a form prescribed by the board of trustees and receive a vested deferred retirement allowance which shall consist of: (1) A member annuity which shall be the actuarial equivalent of accumulated contributions on the date the member’s retirement allowance commences; and (2) A state annuity which, together with the member annuity, shall be equal to a service retirement allowance based on the member’s average final compensation and creditable service at the time the member’s service is terminated.
13 Split Benefits; Minimum Age. Amend RSA 100-A:19-b to read as follows:
100-A:19-b Minimum Age. For the purposes of this subdivision only, minimum age shall mean:
I. For a member who has completed less than [20 years] the minimum years of combined creditable service in both group I and group II as provided in RSA 100-A:1-a, II, 60 years if the member is in vested status before July 1, 2011, or otherwise 65 years.
II. For a member who has completed [20 or more] at least the minimum years of combined creditable service as provided in RSA 100-A:1-a, II, one year shall be deducted from age 60 if the member is in vested status before July 1, 2011, or otherwise age 65, for each year of creditable group II service, provided that the age shall not be less than [45 years] the retirement qualification age under RSA 100-A:1-a, II.
14 Split Benefits; Reduced Early Retirement; Minimum Age. Amend RSA 100-A:19-d to read as follows:
100-A:19-d Reduced Early Retirement. Notwithstanding any other provision of law, any retirement system member who has creditable service in both group I and group II with at least 10 years combined creditable service, and who has attained [an age which is at least 45] the retirement qualification age under RSA 100-A:1-a, II and is within 10 years of the minimum age set forth in RSA 100-A:19-b, may elect to retire and have benefits commence immediately as a reduced split-benefit service retirement allowance. Application shall be as provided in RSA 100-A:5, I(c). The allowance shall be determined as a split-benefit service retirement allowance in accordance with RSA 100-A:19-c, and the total combined split-benefit service allowance shall be reduced by the percentages shown in RSA 100-A:5, I(c), based on the total combined length of creditable service, for each month by which the date on which benefits commence precedes the month after which the member attains the minimum age set forth in RSA 100-A:19-b.
15 Financing; Contribution Rates; Group II Member Payroll Deduction. Amend RSA 100-A:16, I(a) to read as follows:
(a)(1) The member annuity savings fund shall be a fund in which shall be accumulated the contributions deducted from the compensation of members to provide for their member annuities together with any amounts transferred thereto from a similar fund under one or more of the predecessor systems. Such contribution shall be, for each member, subject to the additions to member contributions under RSA 100-A:16, II(f), dependent upon the member’s employment classification at the rate determined in accordance with the following table:
[Employees of employers other than the state 5.00
Employees of the state hired on or before June 30, 2009 5.00
Employees of the state hired after June 30, 2009 7.00
Teachers 5.00
Permanent Policemen 9.30
Permanent Firemen 9.30 ]
Group I members, 7.00
Group II permanent fireman members, 11.80
Group II permanent police members, 11.55
(2) The board of trustees shall certify to the proper authority or officer responsible for making up the payroll of each employer, and such authority or officer shall cause to be deducted from the compensation of each member, except group II members who are in vested status before July 1, 2011 with creditable service in excess of 40 years or group II members who are not in vested status on July 1, 2011 with creditable service in excess of 25 years, as provided in RSA 100-A:5, II(b) and RSA 100-A:6, II(b), on each and every payroll of such employer for each and every payroll period, the percentage of earnable compensation applicable to such member. No deduction from earnable compensation under this paragraph shall apply to any group II member who is in vested status before July 1, 2011 with creditable service in excess of 40 years, or group II member who is not in vested status on July 1, 2011 with creditable service in excess of 25 years, as provided in RSA 100-A:5, II(b) and RSA 100-A:6, II(b), and this provision for such members shall not affect the method of determining average final compensation as provided in RSA 100-A:1, XVIII. In determining the amount earnable by a member in a payroll period, the board may consider the rate of compensation payable to such member on the first day of a payroll period as continuing throughout the payroll period and it may omit deduction from compensation for any period less than a full payroll period if such person was not a member on the first day of the payroll period, and to facilitate the making of deductions it may modify the deduction required of any member by such an amount as shall not exceed 1/10 of one percent of the annual earnable compensation upon the basis of which such deduction is made. The amounts deducted shall be reported to the board of trustees. Each of such amounts, when deducted, shall be paid to the retirement system at such times as may be designated by the board of trustees and credited to the individual account, in the member annuity savings fund, of the member from whose compensation the deduction was made.
16 Employer Contributions; Limitation Beginning 2013. Amend RSA 100-A:16, II(f) to read as follows:
(f)(1) The total amount payable to the state annuity accumulation fund in each year on account of each member classification shall not be less than normal contribution rate multiplied by the total compensation earnable by all members in such classification for such year, plus the amount of the accrued liability contribution necessary to liquidate the unfunded accrued liability on behalf of such classification as determined by the actuary under subparagraph (e) above.
(2) Notwithstanding any provision of this paragraph to the contrary, if in any fiscal year after the fiscal year ending June 30, 2012, the total of the amount payable determined under subparagraph (1) plus the member contributions anticipated for such fiscal year, exceed the total amount payable determined under subparagraph (1) plus the member contributions as determined for fiscal year 2012, then any amount for the upcoming fiscal year which exceeds such total for fiscal year 2012 shall be assessed one-half as employer contributions and one-half as additions to the member contribution rates under RSA 100-A:16, I(a) as determined by the board.
17 Retirement System; Administration; Membership of Board. Amend RSA 100-A:14, I to read as follows:
I. The administration of this system is vested in a board of [14] 13 trustees. Each newly appointed or reappointed trustee shall have familiarity with or experience in finance or business management. The state treasurer shall be an ex officio voting member of the board. The governor and council shall appoint [2] 4 trustees, to be known as non-member trustees, who shall be qualified persons with investment and/or financial experience as provided in this paragraph and not be members of the system, and who shall serve for a term of 2 years and until their successors are appointed and qualified. The non-member trustees of the board shall have substantial experience in the field of institutional investment or finance, taking into account factors such as educational background, business experience, and professional licensure and designations. The original appointment of [one] 2 of the non-member trustees shall be for a term of one year. The remaining [11] 8 members of the board shall consist of [2 employees, 2 teachers, 2 permanent policemen, 2 permanent firemen, one member of the senate who shall be appointed annually by the senate president, one member of the house of representatives who serves on the executive departments and administration committee and who shall be appointed annually by the speaker of the house, and one person representing management in local government. Whenever a vacancy occurs, the senate president or the speaker of the house shall fill the vacancy in the same manner by appointing a senate or a house member who shall serve for the unexpired term.] 4 member representatives and 4 employer representatives. The New Hampshire state employees’ association, the New Hampshire education association, the New Hampshire police association, and the New Hampshire state permanent firemen’s association, [and the New Hampshire Local Government Center] shall each annually nominate from their members a panel of 5 persons, [all of whom except for the panel of the Local Government Center shall be active members of the retirement system, or one of the 4 predecessor systems,] no later than May 31 of each year, and the panels so named shall be filed with the secretary of state no later than June 10 of each year. From [each of] the above named panels, the governor and council shall appoint [one person annually to] the active member representatives of the board[, except for the panel of the Local Government Center, which shall have one person appointed every 2 years] as needed so as to maintain the representation on the board. The governor and council shall appoint the employer representatives of the board with the advice of employer organizations. Members appointed to the board in the manner aforesaid shall serve for a term of 2 years. Each member so appointed shall hold office until his or her successor shall be appointed and qualified. Whenever a vacancy occurs, the governor and council shall fill the vacancy by appointing a member who shall serve for the unexpired term [from the same panel from which the former member was appointed]. The governor shall designate one of the non-member trustees to serve as chairman of said board of trustees.
18 Application; Board of Trustees Membership. Members of the board of trustees for the retirement system on the effective date of this section shall serve for the remainder of their terms. In order to conform to changes to the retirement system board of trustees made by this act, upon a vacancy occurring in the membership on the board of trustees after the effective date of this section, the appointment of a trustee shall be made to reasonably conform to the trustee designations in RSA 100-A:14, I.
19 Repeal of Special Account. RSA 100-A:16, II(h)–(j), relative to the special account, are repealed.
20 Transfer of Balance of Special Account. Any funds remaining in the special account on the effective date of the repeal of the special account by this act shall be transferred to the respective components of the state annuity accumulation fund.
21 Return of Contributions. Amend RSA 100-A:11, I(c) to read as follows:
(c) Upon the death of a group I member who has elected, pursuant to RSA 100-A:10, to receive a vested deferred retirement allowance before his or her attainment of [age 60] the retirement qualification age under RSA 100-A:1-a, I, the amount of his or her accumulated contributions at the time of his or her death shall be paid to the person or persons, if any, nominated by [him] the member, if living, otherwise to the member’s estate.
22 New Paragraph; Definition Added; Part-time Employment. Amend RSA 100-A:1 by inserting after paragraph XXXIII the following new paragraph:
XXXIV. “Part-time,” for purposes of employment of a member, means employment by an employer depending on the group classification of the employment as follows:
(a) For group I, in no instance shall part-time employment of the member exceed 1,300 hours in a calendar year.
(b) For group II, in no instance shall part-time employment of the member exceed 1,300 hours in a calendar year.
23 Membership; Optional. Amend the introductory paragraph of RSA 100-A:3, I(a) to read as follows:
I.(a) Any person who becomes an employee, teacher, permanent policeman, or permanent fireman after the date of establishment, working in a position for an employer under this chapter as determined by common law standards, shall become a member of the retirement system as a condition of employment; except that membership shall be optional in the case of persons who commenced service prior to July 1, 2008 who are elected officials, officials appointed for fixed terms, [unclassified state employees,] or those employees of the general court who are eligible for membership in the retirement system. Elected officials and officials appointed for fixed terms shall, however, be eligible for membership in the retirement system only under the following conditions:
24 Restoration to Service; Limited to Part-time. RSA 100-A:7 is repealed and reenacted to read as follows:
100-A:7 Service After Retirement; Part-time. No employer shall employ a member in other than a part-time position after the member’s retirement pursuant to this chapter.
25 Repeal. 2002, 137:7, relative to the application of the repeal of former RSA 100-A:3, I(c), is repealed.
26 Study Committee Established; Voluntary Defined Contribution Plan.
I. There is established a committee to study the establishment of a federal tax qualified voluntary defined contribution plan.
II. The members of the committee shall be as follows:
(a) Three members of the senate, who shall be from the executive departments and administration committee, appointed by the president of the senate.
(b) Three members of the house of representatives, each of whom shall be from the special committee on public employee pensions reform, appointed by the speaker of the house of representatives.
III. Members of the committee shall receive mileage at the legislative rate when attending to the duties of the committee.
IV. The members of the study committee shall elect a chairperson from among the members. The first meeting of the committee shall be called by the first-named house member. The first meeting of the committee shall be held within 45 days of the effective date of this section. Four members of the committee shall constitute a quorum.
V. The committee shall report its findings and any recommendations for proposed legislation to the president of the senate, the speaker of the house of representatives, the senate clerk, the house clerk, the governor, and the state library on or before November 1, 2011.
27 State Employees; Retirement. Amend RSA 21-I:30, II(a) to read as follows:
(a) Has at least 10 years of creditable service for the state if the employee’s service began prior to July 1, 2003 or 20 years of creditable service if the employee’s service began on or after July 1, 2003, and who also is at least 60 years of age at the time of retirement if the employee is in vested status before July 1, 2011 or at least 65 years of age at the time of retirement if the employee is not in vested status on July 1, 2011; or
28 Definition of Terminal Funding. Amend RSA 100-A:1, XXX to read as follows:
XXX. “Terminal funding’’ shall mean providing the full present value of the total liability for benefit improvement. [Unless otherwise specified, the source of terminal funding shall be the special account established under RSA 100-A:16, II(h).]
29 Benefits Upon Death After Retirement; References to Special Account. Amend RSA 100-A:12, I-a and II to read as follows:
I-a. In addition to any other provision of this section, upon the death of a retired group II member of the New Hampshire retirement system or any predecessor system, who retired pursuant to RSA 100-A:5, II with at least 20 years of creditable service or pursuant to RSA 100-A:6, II(a) prior to April 1, 1987, there shall be paid to the member’s spouse at the time of retirement, if surviving, an allowance to continue until the spouse’s death or remarriage equal to 50 percent of the service or ordinary disability retirement allowance payable to the retired member prior to the member’s death. The total cost of terminally funding the benefits provided by this paragraph shall be funded from the [special account established under RSA 100-A:16, II(h)] state annuity accumulation fund.
II. Upon the death of a group II member who has retired on or after April 1, 1987, or upon the death of a group II member who has filed an application for retirement benefits with the board of trustees after January 1, 1991, there shall be paid to the person nominated by the member by written designation filed with the board, if living, otherwise to the retired member’s estate, in addition to the amount payable under RSA 100-A:11 a lump sum of $3,600 if the member retired before July 1, 1988, and if the member is married on the date of such member’s retirement, there shall be paid to such surviving spouse an allowance to continue until the spouse’s death or remarriage equal to 50 percent of the member’s service, ordinary disability, or accidental disability retirement allowance payments. For any person who is a group II member as of June 30, 1988, and who retires on or after July 1, 1988, the lump sum payment shall be $10,000. For any person who becomes a member of group II on or after July 1, 1988, and on or prior to July 1, 1993, the lump sum payment shall be $3,600. It is the intent of the legislature that future group II members shall be included only if the total cost of such inclusion can be terminally funded [by reimbursement from the special account established under RSA 100-A:16, II(h)].
30 Supplemental Allowance; Reference to Special Account. Amend RSA 100-A:41-a, III to read as follows:
III.(a) The payment of any such supplemental allowance shall be contingent on terminal funding of the total actuarial cost thereof. [Such terminal funding shall be from the special account established under RSA 100-A:16, II(h).]
(b) [No supplemental allowance shall reduce the funds in the respective component of the special account to an amount less than zero.
(c)] Cost of living adjustments shall be retroactive to the member’s eligibility date pursuant to paragraph I.
31 Management of Funds; Investment Committee. Amend RSA 100-A:15, I to read as follows:
I. The members of the board of trustees shall be the trustees of the several funds created hereby and shall set the investment policy relative to those funds. The independent investment committee shall have full power to invest and reinvest such funds in accordance with the policy set by the board. The board of trustees and the members of the independent investment committee shall have the powers, privileges, and immunities of a corporation. The independent investment committee shall have full power to hold, purchase, sell, assign, transfer, and dispose of any of the securities and investments in which any of the funds created hereby have been invested, as well as the proceeds of such investments in accordance with the policy set by the board. All of the assets and proceeds, and income therefrom, of the New Hampshire retirement system, and all contributions and payments made thereto, shall be held, invested, or disbursed in trust.
32 Independent Investment Committee Amend RSA 100-A:15, IX to read as follows:
IX. The non-trustee members of the independent investment committee shall be afforded the same liability insurance [and], indemnification, and statutory protections as board members.
33 New Section; Retirement System; Construction of Provisions; Member Acknowledgement. Amend RSA 100-A by inserting after section 1-a the following new section:
100-A:1-b Construction of Provisions; Member Acknowledgement.
I. The benefits provided under this chapter shall not be construed to constitute a binding contractual obligation with respect to members and may be modified or discontinued by the adoption of appropriate legislation.
II. Every employer shall keep on file for each member commencing service after June 30 2011 a statement of the employee’s, teacher’s, policeman’s, or fireman’s acknowledgement of the provisions of paragraph I of this section.
34 New Paragraph; Public Employee Labor Relations; Status Quo; Authority of Employer. Amend RSA 273-A:11 by inserting after paragraph II the following new paragraph:
III. Following the end of the term of a collective bargaining agreement and during any period of negotiation, the status quo shall be maintained as to the wages, hours, and conditions of employment of employees in good standing. Except where required by statute, the continuation, after the expiration of the agreement, of the provision of any medical, dental, and life insurance benefits, retirement or pension benefits, and any other fringe benefits, shall be subject to the exclusive authority of the public employer.
35 New Section; Department of Administrative Services; State Employee Refusal of Benefits Program. Amend RSA 21-I by inserting after section 43-a the following new section:
21-I:43-b State Employee Refusal of Benefits Program.
I. The commissioner of the department of administrative services shall establish and administer a program which shall allow a permanent full-time state employee to refuse his or her rights as a state employee to receive state medical, dental, and retirement benefits in order to instead receive an increase in his or her base salary or wage.
II. The department shall develop forms, establish procedures, and adopt rules for administering the program established by this section. The forms shall include specific notice of the details of the benefits refused by the election of a state employee under this section. Any such election shall be required to be signed and dated by the state employee.
III. A permanent full-time state employee paid through the office of the state treasurer shall be eligible to refuse state employee benefits as described in paragraph I. Upon verification by the department of the state employee’s refusal of employment benefits, the state employee shall be granted an increase of 25 percent of his or her base salary or wage, excluding pay related to overtime, unused vacation time, unused sick time, longevity pay, or other compensation not deemed by the department to be base salary or wages, to be paid on regular pay schedule for employment during good standing.
IV. The election to refuse state employment benefits for an increase in base salary or wages shall only be available to a permanent full-time state employee who first commenced service with the state on or after July 1, 2011.
V. The source of funds for the payment of the increase of 25 percent for a state employee electing to refuse state employment benefits under this section shall be the employee and retiree benefit risk management fund established in RSA 21-I:30-e.
36 Member Contribution Rates; Contingent Version. The introductory paragraph of RSA 100-A:16, I(a) and the contribution rates following the introductory paragraph are repealed and reenacted to read as follows:
(a) The member annuity savings fund shall be a fund in which shall be accumulated the contributions deducted from the compensation of members to provide for their member annuities together with any amounts transferred thereto from a similar fund under one or more of the predecessor systems. Such contribution shall be, for each member, the rate percent of each member’s compensation as determined by the retirement system which shall by annual total represent 50 percent of the normal contribution and accrued liability contribution determined under paragraph II.
37 Repeal. RSA 100-A:41-d, relative to additional temporary supplemental allowances, is repealed.
38 Severability; Contingent Amendment; Effective Date.
I. The provisions of this act making various amendments concerning the New Hampshire retirement system shall be severable and if any phrase, clause, sentence, or provision of this act is declared to be contrary to the constitution of this state or of the United States or the applicability thereof to any government, agency, person, or circumstance is held invalid, the validity of the remainder of this act and the applicability thereof to any government, agency, person, or circumstance shall not be affected thereby.
II. If as provided in paragraph I of this section, any phrase, clause, sentence, or provision is held contrary to the constitution of this state or of the United States, the remaining provisions of the act shall be in full force and effect as to all severable matters, and, except where the constitutional challenge is principally in the interest of employers in the retirement system as defined in RSA 100-A:1, IV, section 36 of this act shall take effect on the July 1 next following the date that the board of trustees certifies to the secretary of state and the director of legislative services of the occurrence of a final ruling on the declaration described in paragraph I.
39 Retirement System; Recalculation of Employer Rates; Recertification. Notwithstanding the notice requirements of RSA 100-A:16, III, the board of trustees of the retirement system shall recalculate employer contribution rates for the state fiscal years 2012 and 2013 to reflect the requirements of RSA 100-A as amended by this act. Notwithstanding the notice requirements of RSA 100-A:16, III, such employer contribution rates shall be effective for the biennium beginning July 1, 2011, and the recertification of employer contribution percentages, applicable beginning July 1, 2011, shall be provided to each employer within a reasonable period of time not to exceed 30 days from the effective date of this section. The exception to the notice requirements of RSA 100-A:16, III in this section shall be limited to the applicable employer contribution rates for the biennium beginning July 1, 2011.
40 Applicability. Provisions of this act in sections 2, 4–14, RSA 100-A:16, I(a)(2) as inserted by section 15, 27, 35, and 39 containing references to or applicability on June 30, 2011 and July 1, 2011 shall be changed to November 30, 2011 and December 1, 2011, respectively.
41 Effective Date.
I. Section 36 of this act shall take effect as provided in section 38 of this act.
II. RSA 100-A:16, I(a)(1) as inserted by section 15 of this act shall take effect July 1, 2011.
III. The remainder of this act shall take effect December 1, 2011.
LBAO
11-0951
Amended 04/18/11
SB 3 FISCAL NOTE
AN ACT making comprehensive changes to the state retirement system.
FISCAL IMPACT:
The New Hampshire Retirement System and Department of Administrative Services state this bill, as amended by the Senate (Amendments #2011-0701s, #2011-0797s, #2011-0905s, and #2011-1221s), may decrease state, county, and local expenditures by an indeterminable amount in FY 2012 and each year thereafter. There will be no fiscal impact on state, county, and local revenues.
METHODOLOGY:
The New Hampshire Retirement System states the majority of the provisions in this bill do not impact entitlement to or the amount of benefits payable under current law to members vested as of January 1, 2012. The System’s actuary has assumed there will be no grandfathering of provisions under current law, except to the extent specified in the bill. The System’s actuary’s estimated fiscal impact is based on the June 30, 2010 actuarial valuation, assumes an annual rate of return of 8.5 percent, wage inflation at 4.5 percent a year, and uses the entry-age normal cost valuation method. Any differences between the assumed total payroll increase and rate of return percentages and actual percentages will affect the estimated fiscal impact. The System notes its board of trustees is currently in the process of updating actuarial assumptions used to determine employer costs. The System states best practice is to utilize updated assumptions in recertifying rates as directed in section 25 of this bill, which could materially affect the actuarially determined cost savings stated in this fiscal note.
The System’s actuary considered the following provisions of the bill as part of determining the fiscal impact on state, county, and local expenditures: the change in the definition of average final compensation (section 2); the imposition of a limit on member’s retirement benefit of no more than 100% of the member’s highest year of full base rate compensation paid, effective in 2016 (section 3); the change to group II eligibility for certain retirement and disability benefits and the calculation of those benefits for certain members (sections 5 through 10); the change to member contribution rates for members (section 11); the elimination of future increases to medical subsidy payments made by the System (section 18); and the transfer of $89,000,000 from the group II components of the special account to the state annuity accumulation fund (section 21).
The actuary did not consider the following provisions of the bill as part of determining the fiscal impact because there was either no impact or there was insufficient data to estimate an impact to computed contribution rates: the change to the definition of earnable compensation (section 1), the change in the composition of the board of trustees (sections 12-14), the elimination of future transfers to the special account (section 15), the ban on so-called “double dipping” (section 19), the establishment of a study committee (section 22), and the repeal of the employer assessment and purchase of credit for out-of-state service (section 23).
The decreases attributable to each pension group as a result of this bill can be found below in the sections titled Impact on Current Members Pension Assets and Impact on Current Members Medical Subsidy Subtrust.
Impact on Current Members Pension Assets
The following table shows the impact of the proposed bill on the June 30, 2010 valuation for the pension assets.
Supplemental Actuarial Valuation as of June 30, 2010 including proposed pension assets changes affecting current members | ||||
Employees |
Teachers |
Police |
Fire | |
June 30, 2010 Valuation (Current Law) |
||||
Covered Payroll (in millions) |
$1,093.1 |
$1,020.8 |
$258.5 |
$109.0 |
Valuation of Assets |
$1,721.0 |
$2,049.6 |
$997.3 |
$465.9 |
Unfunded Actuarial Accrued Liability |
$1,260.6 |
$1,503.5 |
$637.9 |
$318.1 |
Funded Status |
57.7% |
57.7% |
61.0% |
59.4% |
FY 2012 Employer Rate |
10.71% |
11.51% |
22.92% |
28.25% |
FY 2013 Employer Rate |
10.66% |
11.51% |
22.92% |
28.25% |
June 30, 2010 Valuation Including Proposed Change |
||||
Covered Payroll (in millions) |
$1,093.1 |
$1,020.8 |
$258.5 |
$109.0 |
Valuation of Assets |
$1,721.0 |
$2,049.6 |
$1,052.1 |
$500.1 |
Unfunded Actuarial Accrued Liability |
$1,136.2 |
$1,378.1 |
$519.9 |
$256.5 |
Funded Status |
60.2% |
59.8% |
66.9% |
66.1% |
FY 2012 Employer Rate (1st 6 Months) |
10.71% |
11.51% |
22.92% |
28.25% |
FY 2012 Employer Rate (2nd 6 Months) |
8.15% |
8.88% |
16.60% |
20.53% |
FY 2013 Employer Rate |
8.15% |
8.88% |
16.60% |
20.53% |
The actuary states this bill will decrease the employer contribution rates to the pension fund resulting in the amount contributed by employers to the fund decreasing by the following amounts (in millions):
Employees |
Teachers |
Police |
Fire | |
FY 2012 |
($15.28) |
($14.66) |
($8.92) |
($4.60) |
FY 2013 |
($31.31) |
($30.64) |
($18.64) |
($9.60) |
Impact on Current Members Medical Subsidy Subtrust
The following table shows the impact of the proposed bill on the June 30, 2010 valuation for the medical subsidy subtrust.
Supplemental Actuarial Valuation as of June 30, 2010 including proposed medical subsidy changes affecting current members | ||||
State Employees |
Political Subdivision Employees |
Teachers |
Police and Fire | |
June 30, 2010 Valuation (Current Law) |
||||
Covered Payroll (in millions) |
$520.7 |
$572.4 |
$1,020.8 |
$367.5 |
Valuation of Assets |
$0 |
$34.0 |
$7.3 |
$16.5 |
Unfunded Actuarial Accrued Liability |
$122.3 |
$66.5 |
$360.1 |
$427.1 |
Current Statutory Rate FY 2012 & FY 2013 |
1.60% |
0.38% |
2.44% |
2.65% |
June 30, 2010 Valuation Including Proposed Change |
||||
Covered Payroll (in millions) |
$520.7 |
$572.4 |
$1,020.8 |
$367.5 |
Valuation of Assets |
$0 |
$34.0 |
$7.3 |
$16.5 |
Unfunded Actuarial Accrued Liability |
$92.5 |
$39.5 |
$254.8 |
$286.4 |
Statutory Rate FY 2012 (1st 6 Months) |
1.60% |
0.38% |
2.44% |
2.65% |
Statutory Rate FY 2012 (2nd 6 Months) |
1.82% |
0.32% |
2.31% |
3.97% |
Statutory Rate FY 2013 |
1.54% |
0.32% |
2.31% |
3.97% |
The actuary states the bill will change the employer contribution rates to the medical subsidy subtrust in FY 2012 and FY 2013 resulting in employer contributions to the subtrust changing by the following amounts (in millions):
State Employees |
Political Subdivision Employees |
Teachers |
Police and Fire | |
FY 2012 |
$0.63 |
($0.19) |
($0.72) |
$2.66 |
FY 2013 |
($0.36) |
($0.39) |
($1.51) |
$5.53 |
Impact on Special Account
The System assumes the amounts transferred from the special account will be as follows (in millions):
|
State |
Political Subdivisions |
Total | |
Police |
$12.90 |
$41.93 |
$54.83 |
Fire |
$0.99 |
$33.18 |
$34.17 |
Total |
$13.89 |
$75.11 |
$89.00 |
The System states this asset transfer produces a contribution reduction in accordance with current funding policies in the statute.
Impact on New Hires (After January 1, 2012)
The System’s actuary states the proposed changes to benefits for new hires has no effect on the System’s current benefit obligation or current employer contributions for active members. The actuary states the normal cost of providing benefits to new members hired after January 1, 2012 will decrease, in total, for each group by the following:
Employees |
Teachers |
Police |
Fire | |
Percentage of Payroll |
(0.25%) |
(0.24%) |
(4.19%) |
(4.90%) |
In summary, the New Hampshire Retirement System states projected annual state and political subdivision (county and local) employer contribution savings as a result of this bill are as follows:
(1) |
(2) |
(3) |
(4) | ||
Political Subdivisions |
35% of Political Subdivisions |
100% of State Employees |
Total State Savings (2 + 3) | ||
2012 |
|||||
Employees |
($8,188,983) |
$0 |
($6,652,982) |
($6,652,982) | |
Teachers |
($9,998,669) |
($5,383,899) |
$0 |
($5,383,899) | |
Police |
($3,322,767) |
($1,789,182) |
($1,944,486) |
($3,733,668) | |
Fire |
($2,389,977) |
($1,286,911) |
($132,795) |
($1,419,706) | |
Total |
($23,900,396) |
($8,459,992) |
($8,730,263) |
($17,190,255) | |
2013 |
|||||
Employees |
($16,788,353) |
$0 |
($15,271,436) |
($15,271,436) | |
Teachers |
($20,897,218) |
($11,252,348) |
$0 |
($11,252,348) | |
Police |
($6,944,582) |
($3,739,391) |
($4,063,975) |
($7,803,366) | |
Fire |
($4,995,053) |
($2,689,644) |
($277,542) |
($2,967,186) | |
Total |
($49,625,206) |
($17,681,383) |
($19,612,953) |
($37,294,336) | |
2014 |
|||||
Employees |
($18,567,788) |
$0 |
($16,890,090) |
($16,890,090) | |
Teachers |
($21,362,863) |
($11,503,080) |
$0 |
($11,503,080) | |
Police |
($12,714,420) |
($6,846,226) |
($7,440,488) |
($14,286,714) | |
Fire |
($8,066,269) |
($4,343,376) |
($448,189) |
($4,791,565) | |
Total |
($60,711,340) |
($22,692,682) |
($24,778,767) |
($47,471,449) | |
2015 |
|||||
Employees |
($19,546,010) |
$0 |
($18,558,607) |
($18,558,607) | |
Teachers |
($23,812,471) |
($12,822,100) |
$0 |
($12,822,100) | |
Police |
($13,650,584) |
($7,350,315) |
($7,988,333) |
($15,338,648) | |
Fire |
($8,582,666) |
($4,621,435) |
($476,882) |
($5,098,317) | |
Total |
($65,591,731) |
($24,793,850) |
($27,023,822) |
($51,817,672) |
The System further states it estimates it would incur $222,000 in computer programming costs in FY 2012 to implement the changes in this bill.
The Department of Administrative Services states this bill amends RSA 21-I:30, III changing the age and years of service requirements for eligibility for retiree health insurance benefits for group II employees, unless the employee is in vested status by January 1, 2012. The Department is unable to determine the number of years of creditable service on an employee basis and therefore is unable to estimate a fiscal impact to this bill. The Department estimates the decrease in costs of delayed health benefits per retiree in would be $6,009 for the 2nd 6 months of FY 2012, $12,618 in FY 2013, $13,881 in FY 2014, and $15,995 in FY 2015.