Bill Details - HB497 (2019)

HB 497-FN-A-LOCAL - AS INTRODUCED

 

 

2019 SESSION

19-0006

10/04

 

HOUSE BILL 497-FN-A-LOCAL

 

AN ACT relative to payment by the state of a portion of retirement system contributions of political subdivision employers.

 

SPONSORS: Rep. Cushing, Rock. 21; Rep. Cloutier, Sull. 10; Rep. O'Brien, Hills. 36; Rep. Martin, Hills. 23; Rep. Edgar, Rock. 21; Rep. Loughman, Rock. 21; Rep. Bushway, Rock. 21; Rep. Morrison, Rock. 9; Rep. King, Hills. 33; Rep. Ley, Ches. 9; Sen. Rosenwald, Dist 13; Sen. Sherman, Dist 24; Sen. Cavanaugh, Dist 16

 

COMMITTEE: Executive Departments and Administration

 

-----------------------------------------------------------------

 

ANALYSIS

 

This bill provides that the state shall pay 15 percent of contributions of retirement system employers other than the state for group I teachers and group II members.

 

- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -

 

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Matter which is either (a) all new or (b) repealed and reenacted appears in regular type.

19-0006

10/04

 

STATE OF NEW HAMPSHIRE

 

In the Year of Our Lord Two Thousand Nineteen

 

AN ACT relative to payment by the state of a portion of retirement system contributions of political subdivision employers.

 

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

 

1  Retirement System; Employer Contributions; State Share of Contributions.  Amend RSA 100-A:16, II(b) and (c) to read as follows:

(b)  The contributions of each employer for benefits under the retirement system on account of group II members shall consist of a percentage of the earnable compensation of its members to be known as the "normal contribution,'' and an additional amount to be known as the "accrued liability contribution;'' provided that beginning with state fiscal year [2013] 2020 and for each state fiscal year thereafter, any employer [shall pay the full amount of such total contributions] other than the state, shall pay 85 percent of such total contributions, and 15 percent thereof shall be paid by the state; and provided further that, in case of group II members employed by the state, the state shall pay both normal and accrued liability contributions.  The rate percent of such normal contribution, including contributions on behalf of group II members whose group II creditable service is in excess of 40 years, in each instance shall be fixed on the basis of the liabilities of the system with respect to the particular members of the various member classifications as shown by actuarial valuations, except as provided in subparagraph (i).

(c)  The contributions of each employer for benefits under the retirement system on account of group I members shall consist of a percentage of the earnable compensation of its members to be known as the "normal contribution,'' and an additional amount to be known as the "accrued liability contribution;'' provided that beginning with state fiscal year [2013] 2020 and for each state fiscal year thereafter, in the case of teachers, any employer [shall pay the full amount of such total contributions] other than the state, shall pay 85 percent of such total contributions, and 15 percent thereof shall be paid by the state; and provided further that, in case of teacher members employed by the state, the state shall pay both normal and accrued liability contributions.  The rate percent of such normal contribution in each instance shall be fixed on the basis of the liabilities of the system with respect to the particular members of the various member classifications as shown by actuarial valuation, except as provided in subparagraph (i).

2  Repeal.  RSA 100-A:16, II(c-1) relative to employer contributions for fiscal year 2012, is repealed.

3  Effective Date.  This act shall take effect July 1, 2019.

 

LBAO

19-0006

10/31/18

 

HB 497-FN-A-LOCAL- FISCAL NOTE

AS INTRODUCED

 

AN ACT relative to payment by the state of a portion of retirement system contributions of political subdivision employers.

 

FISCAL IMPACT:      [ X ] State              [ X ] County               [ X ] Local              [    ] None

 

 

 

Estimated Increase / (Decrease)

STATE:

FY 2020

FY 2021

FY 2022

FY 2023

   Appropriation

$0

$0

$0

$0

   Revenue

$0

$0

$0

$0

   Expenditures

$41.94 million

$43.17 million

$44.42 million

$45.72 million

Funding Source:

  [ X ] General            [    ] Education            [    ] Highway           [    ] Other

 

 

 

 

 

POLITICAL SUBDIVISIONS:

 

 

 

 

   Revenue

$0

$0

$0

$0

   Expenditures

($41.94 million)

($43.17 million)

($44.42 million)

($45.72 million)

*The New Hampshire Retirement System states it is not able to separate the fiscal impact of this legislation between county and local government, therefore the fiscal impact is shown together as political subdivisions.

 

METHODOLOGY:

This bill requires the State to pay 15 percent of the normal and accrued liability contributions of political subdivision retirement system employers for group I teachers and group II (police and fire) members.  The remaining 85 percent will be paid by the political subdivision employers that pay 100 percent of such contributions under current law.  The New Hampshire Retirement System's (NHRS) contracted actuary conducted a supplemental actuarial valuation to estimate the impact of the bill.  As detailed in the table below, state General Fund expenditures will increase and county and local expenditures will decrease.  NHRS is unable to break out the costs attributable to political subdivisions into the county and local shares.  

Net Impact on Contributions in $ Millions
Increase/(Decrease)

 

County & Local Employer Contribution

State 

Group I

Group II

 

Teachers

Police

Fire

FY 2020

 

(27.93)

(8.78)

(5.23)

41.94

FY 2021

 

(28.70)

(9.07)

(5.40)

43.17

FY 2022

 

(29.49)

(9.36)

(5.57)

44.42

FY 2023

 

(30.30)

(9.67)

(5.75)

45.72

Note:  The estimates in the table above are based on calculations that do not include the medical benefit subsidy under RSA 100-A:52, 52-a, and 52-b because this bill does not impact said sections.

 

AGENCIES CONTACTED:

New Hampshire Retirement System

 

Docket

Date Status
Jan. 3, 2019 Introduced 01/03/2019 and referred to Executive Departments and Administration HJ 3 P. 17
Jan. 23, 2019 Public Hearing: 01/23/2019 01:00 pm LOB 306-308
Feb. 5, 2019 Executive Session: 02/05/2019 10:00 am LOB 306
Feb. 14, 2019 Majority Committee Report: Ought to Pass for 02/14/2019 (Vote 15-5; RC) HC 11 P. 15
Majority Committee Report: Ought to Pass (Vote 15-5; RC)
Minority Committee Report: Ought to Pass with Amendment # 2019-0113h (NT)
Feb. 14, 2019 Amendment # 2019-0113h (NT): AF RC 144-232 02/14/2019 HJ 5 P. 36
Feb. 14, 2019 Ought to Pass: MA RC 256-120 02/14/2019 HJ 5 P. 36
Feb. 14, 2019 Referred to Finance 02/14/2019 HJ 5 P. 41
Feb. 20, 2019 Finance-Division I Work Session: 02/20/2019 10:30 am LOB 212
March 13, 2019 Executive Session: 03/13/2019 10:00 am LOB 210-211
Retained in Committee

Action Dates

Date Body Type
Jan. 23, 2019 House Hearing
Feb. 5, 2019 House Exec Session
House Floor Vote
Feb. 14, 2019 House Floor Vote
March 13, 2019 House Exec Session

Bill Text Revisions

HB497 Revision: 4762 Date: Jan. 15, 2019, 9:42 a.m.