SB0274

SENATE BILL 274

50th legislature - STATE OF NEW MEXICO - second session, 2012

INTRODUCED BY

Stuart Ingle

AN ACT

RELATING TO PENSIONS; REDUCING THE AMOUNT OF PENSION FOR NON-VESTED MEMBERS IN THE PUBLIC EMPLOYEES RETIREMENT ASSOCIATION BY REDUCING THE MULTIPLIER AND INCREASING THE NUMBER OF YEARS USED TO CALCULATE THE FINAL AVERAGE SALARY; PROVIDING THAT REFUNDS OF MEMBER CONTRIBUTIONS SHALL NOT INCLUDE INTEREST.

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

SECTION 1. Section 10-11-14.6 NMSA 1978 (being Laws 2009, Chapter 288, Section 12) is amended to read:

"10-11-14.6. CALCULATION OF FINAL AVERAGE SALARY.--Under each coverage plan of the Public Employees Retirement Act, the final average salary is [one thirty-sixth] one-sixtieth of the greatest aggregate amount of salary paid a member for [thirty-six] sixty consecutive but not necessarily continuous months of service credit."

SECTION 2. Section 10-11-26.3 NMSA 1978 (being Laws 1994, Chapter 128, Section 4) is amended to read:

"10-11-26.3. STATE GENERAL MEMBER COVERAGE PLAN 3--AMOUNT OF PENSION--FORM OF PAYMENT A.--Under state general member coverage plan 3, the amount of pension under form of payment A is:

A. for a member who has five or more years of service credit on or before July 1, 2012, equal to three percent of final average salary multiplied by service credit. The amount shall not exceed eighty percent of the final average salary; and

B. for a member who does not have five or more years of service credit on or before July 1, 2012, equal to two and sixty-seven hundredths percent of final average salary multiplied by service credit. The amount shall not exceed eighty percent of the final average salary."

SECTION 3. Section 10-11-29 NMSA 1978 (being Laws 1987, Chapter 253, Section 29, as amended) is amended to read:

"10-11-29. STATE POLICE MEMBER AND ADULT CORRECTIONAL OFFICER MEMBER COVERAGE PLAN 1--AMOUNT OF PENSION--FORM OF PAYMENT A.--Under state police member and adult correctional officer member coverage plan 1, the amount of pension under form of payment A is:

A. for a member who has five or more years of service credit on or before July 1, 2012, equal to three percent of final average salary multiplied by credited service. The amount shall not exceed eighty percent of the final average salary; and

B. for a member who does not have five or more years of service credit on or before July 1, 2012, equal to two and sixty-seven hundredths percent of final average salary multiplied by credited service. The amount shall not exceed eighty percent of the final average salary."

SECTION 4. Section 10-11-38.3 NMSA 1978 (being Laws 1994, Chapter 128, Section 11) is amended to read:

"10-11-38.3. STATE HAZARDOUS DUTY MEMBER COVERAGE PLAN 2--AMOUNT OF PENSION--FORM OF PAYMENT A.--Under state hazardous duty member coverage plan 2, the amount of pension under form of payment A is:

SECTION 5. Section 10-11-52 NMSA 1978 (being Laws 1987, Chapter 253, Section 52) is amended to read:

"10-11-52. MUNICIPAL GENERAL MEMBER COVERAGE PLAN 2--AMOUNT OF PENSION--FORM OF PAYMENT A.--Under municipal general member coverage plan 2, the amount of pension under form of payment A is:

A. for a member who has five or more years of service credit on or before July 1, 2012, equal to two and one-half percent of the final average salary multiplied by credited service. The amount shall not exceed seventy-five percent of the final average salary; and

B. for a member who does not have five or more years of service credit on or before July 1, 2012, equal to two and two hundred twenty-five thousandths percent of final average salary multiplied by credited service. The amount shall not exceed seventy-five percent of the final average salary."

SECTION 6. Section 10-11-55.3 NMSA 1978 (being Laws 1993, Chapter 58, Section 3) is amended to read:

"10-11-55.3. MUNICIPAL GENERAL MEMBER COVERAGE PLAN 3--AMOUNT OF PENSION--FORM OF PAYMENT A.--Under municipal general member coverage plan 3, the amount of pension under form of payment A is:

A. for a member who has five or more years of service credit on or before July 1, 2012, equal to three percent of the final average salary multiplied by credited service. The amount shall not exceed eighty percent of the final average salary; and

B. for a member who does not have five or more years of credited service on or before July 1, 2012, equal to two and sixty-seven hundredths percent of final average salary multiplied by credited service. The amount shall not exceed eighty percent of the final average salary."

SECTION 7. Section 10-11-55.9 NMSA 1978 (being Laws 1998, Chapter 106, Section 3) is amended to read:

"10-11-55.9. MUNICIPAL GENERAL MEMBER COVERAGE PLAN 4--AMOUNT OF PENSION--FORM OF PAYMENT A.--Under municipal general member coverage plan 4, the amount of pension under form of payment A is:

B. for a member who does not have five or more years of service credit on or before July 1, 2012, equal to two and sixty-seven hundredths percent of final average salary multiplied by credited service. The amount shall not exceed eighty percent of the final average salary."

SECTION 8. Section 10-11-64 NMSA 1978 (being Laws 1987, Chapter 253, Section 64) is amended to read:

"10-11-64. MUNICIPAL POLICE MEMBER COVERAGE PLAN 2--AMOUNT OF PENSION--FORM OF PAYMENT A.--Under municipal police member coverage plan 2, the amount of pension under form of payment A is:

A. for a member who has five or more years of service credit on or before July 1, 2012, equal to two and one-half percent of the final average salary multiplied by credited service. The amount shall not exceed one hundred percent of the final average salary; and

SECTION 9. Section 10-11-70 NMSA 1978 (being Laws 1987, Chapter 253, Section 70) is amended to read:

"10-11-70. MUNICIPAL POLICE MEMBER COVERAGE PLAN 3--AMOUNT OF PENSION--FORM OF PAYMENT A.--Under municipal police member coverage plan 3, the amount of pension under form of payment A is:

A. for a member who has five or more years of service credit on or before July 1, 2012, equal to two and one-half percent of the final average salary multiplied by credited service. The amount shall not exceed one hundred percent of the final average salary; and

SECTION 10. Section 10-11-76 NMSA 1978 (being Laws 1987, Chapter 253, Section 76) is amended to read:

"10-11-76. MUNICIPAL POLICE MEMBER COVERAGE PLAN 4--AMOUNT OF PENSION--FORM OF PENSION A.--Under municipal police member coverage plan 4, the amount of pension under form of payment A is:

B. for a member who does not have five or more years of service credit on or before July 1, 2012, equal to two and sixty-seven hundredths percent of final average salary multiplied by credited service. The amount shall not exceed eighty percent of the final average salary."

SECTION 11. Section 10-11-82 NMSA 1978 (being Laws 1987, Chapter 253, Section 82) is amended to read:

"10-11-82. MUNICIPAL POLICE MEMBER COVERAGE PLAN 5--AMOUNT OF PENSION--FORM OF PAYMENT A.--Under municipal police member coverage plan 5, the amount of pension under form of payment A is:

A. for a member who has five or more years of service credit on or before July 1, 2012, equal to three and one-half percent of the final average salary multiplied by credited service. The amount shall not exceed eighty percent of the final average salary; and

B. for a member who does not have five or more years of service credit on or before July 1, 2012, equal to three and one hundred fifteen thousandths percent of final average salary multiplied by credited service. The amount shall not exceed eighty percent of the final average salary."

SECTION 12. Section 10-11-94 NMSA 1978 (being Laws 1987, Chapter 253, Section 94) is amended to read:

"10-11-94. MUNICIPAL FIRE MEMBER COVERAGE PLAN 2--AMOUNT OF PENSION--FORM OF PAYMENT A.--Under municipal fire member contribution plan 2, the amount of pension under form of payment A is:

A. for a member who has five or more years of service credit on or before July 1, 2012, equal to two and one-half percent of the final average salary multiplied by credited service. The amount shall not exceed one hundred percent of the final average salary; and

SECTION 13. Section 10-11-100 NMSA 1978 (being Laws 1987, Chapter 253, Section 100) is amended to read:

"10-11-100. MUNICIPAL FIRE MEMBER COVERAGE PLAN 3--AMOUNT OF PENSION--FORM OF PAYMENT A.--Under municipal fire member coverage plan 3, the amount of pension under form of payment A is:

A. for a member who has five or more years of service credit on or before July 1, 2012, equal to two and one-half percent of the final average salary multiplied by credited service. The amount shall not exceed one hundred percent of the final average salary; and

SECTION 14. Section 10-11-106 NMSA 1978 (being Laws 1987, Chapter 253, Section 106) is amended to read:

"10-11-106. MUNICIPAL FIRE MEMBER COVERAGE PLAN 4--AMOUNT OF PENSION--FORM OF PAYMENT A.--Under municipal fire member coverage plan 4, the amount of pension under form of payment A is:

B. for a member who does not have five or more years of service credit on or before July 1, 2012, equal to two and sixty-seven hundredths percent of final average salary multiplied by credited service. The amount shall not exceed eighty percent of the final average salary."

SECTION 15. Section 10-11-112 NMSA 1978 (being Laws 1987, Chapter 253, Section 112) is amended to read:

"10-11-112. MUNICIPAL FIRE MEMBER COVERAGE PLAN 5--AMOUNT OF PENSION--FORM OF PAYMENT A.--Under municipal fire member coverage plan 5, the amount of pension under form of payment A is:

SECTION 16. Section 10-11-115.3 NMSA 1978 (being Laws 2003, Chapter 268, Section 4) is amended to read:

"10-11-115.3. MUNICIPAL DETENTION OFFICER MEMBER COVERAGE PLAN 1--AMOUNT OF PENSION--FORM OF PAYMENT A.--Under municipal detention officer member coverage plan 1, the amount of pension under form of payment A is:

B. for a member who does not have five or more years of service credit on or before July 1, 2012, equal to two and sixty-seven hundredths percent of final average salary multiplied by credited service. The amount shall not exceed eighty percent of the final average salary."

SECTION 17. Section 10-11-124 NMSA 1978 (being Laws 1987, Chapter 253, Section 124, as amended) is amended to read:

"10-11-124. MEMBER CONTRIBUTION FUND.--

A. The member contribution fund is the accounting fund in which shall be accumulated contributions of members and from which shall be made refunds and transfers of accumulated member contributions as provided in the Public Employees Retirement Act. Each affiliated public employer shall cause the member contributions specified by the coverage plan applicable to each of that affiliated public employer's members to be deducted from the salary of each member. Each affiliated public employer shall remit the deducted member contributions to the association in accordance with the procedures and schedules established by the association. The association may assess an interest charge and a penalty charge on any remittance not made by its due date. Each member shall be deemed to consent and agree to the deductions made and provided for in this section by continuing employment with the affiliated public employer. Contributions by members shall be credited to the members' individual accounts in the member contribution fund.

B. A member's accumulated contributions shall be transferred to the retirement reserve fund if a pension becomes payable upon the retirement or death of the member. If a disability retirement pension is terminated for a reason other than the death of the disability retired member before an amount equal to the disability retired member's accumulated member contributions has been paid, the unexpended balance of the accumulated member contributions shall be transferred from the retirement reserve fund to the former disability retired member's individual account in the member contribution fund.

C. If a member terminates affiliated public employment or is on leave of absence from an affiliated public employer as a consequence of the entry into active duty with the armed forces of the United States, the member may, with the written consent of the member's spouse, if any, withdraw the member's accumulated member contributions, upon making written request in a form prescribed by the association. Upon written request of the member in the form prescribed by the association, a refund of member contributions may be made by a trustee-to-trustee transfer of the contributions from the member contribution fund directly to another qualified plan as allowed by the Internal Revenue Code of 1986. Withdrawal of member contributions shall result in forfeiture of the service credit accrued for the period during which the contributions were made.

D. A member shall, upon commencement of membership, designate a refund beneficiary who shall receive the refund of the member contributions, plus interest if any, if the member dies and no survivor pension is payable. If the member is married at the time of designation, written spousal consent shall be required if the designated refund beneficiary is other than the spouse. Marriage subsequent to the designation shall automatically revoke a previous designation, and the spouse shall become the refund beneficiary unless or until another designation is filed with the association. Divorce subsequent to the designation shall automatically revoke designation of the former spouse as refund beneficiary, or the right of the former spouse to be refund beneficiary if no designation has been filed, and the refund shall be paid to the deceased member's estate unless the member filed a designation of refund beneficiary subsequent to the divorce. The refund shall be paid to the refund beneficiary named in the most recent designation of refund beneficiary on file with the association unless that beneficiary is deceased. If there is not a living refund beneficiary named in the most recent designation of refund beneficiary on file with the association, the deceased member's accumulated member contributions shall be paid to the estate of the deceased member.

E. On and after July 1, 2012, a refund of member contributions paid pursuant to Subsection C or D of this section shall not include interest on the refunded contributions; provided, however, that interest accrued through June 30, 2012 shall be paid on refunded contributions."

SECTION 18. Section 10-12B-9 NMSA 1978 (being Laws 1992, Chapter 111, Section 9, as amended) is amended to read:

"10-12B-9. AMOUNT OF PENSION.--The amount of monthly pension is equal to:

A. in the case of a former or current judge or justice, an amount equal to one-twelfth of:

seventy-five percent number of years of

of salary received service, not

during last year in X exceeding ten years,

office prior to divided by ten; retirement

B. in the case of a new judge or justice who initially became a member prior to July 1, 2005, an amount equal to one-twelfth of:

seventy-five percent of (number of years of

salary received during service, not

last year in office X .05 X exceeding fifteen prior to retirement years, plus

five years); [or]

C. in the case of a new judge or justice who initially became a member on or after July 1, 2005 and who has five or more years of service credit on or before July 1, 2012, an amount equal to one-twelfth of the salary received during the last year in office prior to retirement multiplied by the product of three and seventy-five hundredths percent times the sum of the number of years of service; provided that a pension calculated pursuant to this subsection shall not exceed seventy-five percent of one-twelfth of the salary received during the last year in office; or

D. in the case of a new judge or justice who initially became a member on or after July 1, 2005 and who does not have five or more years of service credit on or before July 1, 2012, an amount equal to one-twelfth of the salary received during the last year in office prior to retirement multiplied by the product of three and three hundred thirty-eight thousandths percent times the sum of the number of years of service; provided that a pension calculated pursuant to this subsection shall not exceed seventy-five percent of one-twelfth of the salary received during the last year in office."

SECTION 19. Section 10-12C-9 NMSA 1978 (being Laws 1992, Chapter 118, Section 9) is amended to read:

"10-12C-9. AMOUNT OF PENSION.--The amount of pension is:

A. for a member who has five or more years of service credit on or before July 1, 2012, equal to one-twelfth of:

seventy-five percent of (number of years of

salary received during service, not exceeding

last year in office X .05 X fifteen years, [+]

prior to retirement plus five years); and

B. for a member who does not have five or more years of service credit on or before July 1, 2012, equal to one-twelfth of:

seventy-five percent of (number of years of

salary received during service, not exceeding

last year in office X .0445 X fifteen years, prior to retirement plus five years)."

SECTION 20. EFFECTIVE DATE.--The effective date of the provisions of this act is July 1, 2012.

- 17 -