44th legislature - STATE OF NEW MEXICO - second session, 2000

RELATING TO EDUCATIONAL RETIREMENT; PROVIDING FOR A DEFERRED RETIREMENT OPTION PLAN FOR CERTAIN EMPLOYEES.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF NEW MEXICO:

Section 1. Section 22-11-21 NMSA 1978 (being Laws 1967, Chapter 16, Section 144, as amended) is amended to read:

"22-11-21. CONTRIBUTIONS--MEMBERS--LOCAL ADMINISTRATIVE

UNITS.--Except as provided in Section 22-11-30.2 NMSA 1978:

A. each member shall make contributions to the fund in the amount of seven and six-tenths percent of his annual salary; and

[B. Until June 30, 1993, each local administrative unit shall make a yearly contribution to the fund of a sum equal to seven and six-tenths percent of the annual salary of each member employed by the local administrative unit.

C. Beginning July 1, 1993 and thereafter]

B. each local administrative unit shall make a yearly contribution to the fund of a sum equal to eight and sixty-five hundredths percent of the annual salary of each member employed by the local administrative unit."

Section 2. A new section of the Educational Retirement Act, Section 22-11-30.2 NMSA 1978, is enacted to read:

"22-11-30.2. [NEW MATERIAL] DEFERRED RETIREMENT OPTION PLAN.--

A. On or after October 1, 2000, a member who remains in contributory employment may make an irrevocable election with the director to participate in a deferred retirement option plan if:

(1) the member is a certified school employee as defined in Section 22-1-2 NMSA 1978;

(2) the member has twenty-eight years or more of service credit; and

(3) the election is made on a form prescribed by the director and specifies:

(a) the period for which the member agrees to participate in the plan; provided that the period shall be in annual increments and shall not be more than five years; and

(b) that the member has either selected deferred retirement option Plan One or deferred retirement option Plan Two.

B. If the member selects deferred retirement option Plan One, during the period the member participates in the plan:

(1) the member's salary shall be determined through negotiations between the member and the local administrative unit;

(2) the member's contribution to the fund shall equal seven and seventy-six hundredths percent of the member's annual salary;

(3) the local administrative unit shall make no contribution to the fund;

(4) no additional service credit shall be accredited; and

(5) every month the member shall receive an amount equal to the retirement benefit that the member would have received that month if the member had retired at the time of making the election under Subsection A of this section.

C. If the member selects deferred retirement option Plan Two:

(1) during the period the member participates in the plan:

(a) the member shall continue to receive a salary based upon the appropriate placement on the district salary schedule;

(b) the member shall make no contribution to the fund;

(c) the local administrative unit's contributions to the fund shall equal eight and one-tenth percent of the member's annual salary;

(d) no additional service credit shall be accredited; and

(e) every month, the director shall transfer to a deferred retirement option account, created for the member within the fund, an amount equal to the retirement benefit that the member would have received that month if the member had retired at the time of making the election under Subsection A of this section;

(2) if the member dies while participating in the plan or after participation but before retirement, the member's beneficiary shall be paid the total amount credited to the member's deferred retirement option account plus interest at the average rate earned by the fund during the preceding five fiscal years; and

(3) upon retirement pursuant to the Educational Retirement Act, the member shall be paid the total amount credited to the member's deferred retirement option account plus interest at the average rate earned by the fund during the preceding five fiscal years.

D. Any salary paid to a member while participating in a deferred retirement option plan shall be excluded when calculating the member's average annual salary pursuant to Subsection H of Section 22-11-30 NMSA 1978.

E. A member terminates participation in a deferred retirement option plan by:

(1) retirement;

(2) death; or

(3) expiration of the period for which the member elected to participate in the plan.

F. A payment made pursuant to this section is in addition to any retirement benefit otherwise payable pursuant to the Educational Retirement Act."