SENATE BILL

57th legislature - STATE OF NEW MEXICO - first session, 2025

INTRODUCED BY

Natalie Figueroa

 

 

 

ENDORSED BY THE INVESTMENTS AND PENSIONS OVERSIGHT COMMITTEE

 

AN ACT

RELATING TO EDUCATIONAL RETIREMENT; MAKING CHANGES TO THE EDUCATIONAL RETIREMENT ACT; CLARIFYING RESTRICTIONS ON RECEIPT OF GIFTS; PROVIDING FOR UNCLAIMED MEMBER CONTRIBUTIONS TO BE DEPOSITED INTO THE EDUCATIONAL RETIREMENT FUND; CLARIFYING CERTAIN TERMS; ALLOWING FOR A MEMBER ON DISABILITY STATUS WHO IS OVER SIXTY AND WHO RECEIVES AN ANNUITY ADJUSTMENT TO CONTINUE RECEIVING THE ANNUITY ADJUSTMENT; REQUIRING PAYMENT OF ALLOWED SERVICE WITHIN NINETY DAYS; ALLOWING FOR DISCLOSURE OF MEMBER OR RETIRED MEMBER INFORMATION TO THE PUBLIC EMPLOYEES RETIREMENT BOARD TO ADMINISTER.

 

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

     SECTION 1. Section 22-11-5.1 NMSA 1978 (being Laws 1999, Chapter 153, Section 2, as amended) is amended to read:

     "22-11-5.1. RESTRICTIONS ON RECEIPT OF GIFTS.--Except for gifts of food or beverage [given] consumed in a place of public accommodation [consumed] at the time of receipt [not exceeding fifty dollars ($50.00) for] or a single gift of value not exceeding fifty dollars ($50.00), and the aggregate value of which gifts [may] shall not exceed one hundred fifty dollars ($150) in a calendar year, neither a board member nor an employee of the board shall receive or accept anything of value directly or indirectly from a person who:

          A. has a current contract with the board;

          B. is a potential bidder, offeror or contractor for the provision of services or personal property to the board;

          C. is authorized to invest public funds pursuant to state or federal law or is an employee or agent of such a person; or

          D. is an organization, association or other entity having a membership that includes persons described in Subsections A through C of this section."

     SECTION 2. Section 22-11-11 NMSA 1978 (being Laws 1967, Chapter 16, Section 135, as amended) is amended to read:

     "22-11-11. EDUCATIONAL RETIREMENT FUND--SUSPENSE FUND.--

          A. The "educational retirement fund" and the "educational retirement suspense fund" are created.

          B. The state treasurer shall be the custodian of the funds, and the board shall be the trustee of the funds.

          C. All membership fees, contributions from members and local administrative units, securities evidencing the investment of money from the fund, unclaimed member contributions, interest, gifts, grants or bequests shall be deposited in the educational retirement fund.

          D. All amounts received in satisfaction of a claim brought by private attorneys on behalf of the board shall be deposited into the educational retirement suspense fund. The board shall disburse the compensation due the private attorneys, together with reimbursement for reasonable costs and expenses, in accordance with the terms of the contract with the attorneys. After the disbursements have been made, the balance of each deposit shall be distributed to the educational retirement fund."

     SECTION 3. Section 22-11-24 NMSA 1978 (being Laws 1967, Chapter 16, Section 147) is amended to read:

     "22-11-24. RETIREMENT BENEFITS--MINIMUM CONTRIBUTORY EMPLOYMENT.--

          A. A member [must] shall have acquired not less than five years of contributory employment to be eligible for retirement benefits pursuant to the Educational Retirement Act.

          B. A member desiring to retire before having completed five years of contributory employment shall be limited to the maximum benefit [he] the member would have been entitled to receive under any statute repealed by the Educational Retirement Act. A member may acquire five years or less of contributory employment by contributing to the fund, for each year of contributory employment desired, a sum equal to the prevailing combined contributions of the member and the local administrative unit in effect at the time the contributory employment is acquired. This contribution shall be computed on the member's average annual salary for the last five years of employment plus an additional sum as interest from the effective date of the Educational Retirement Act as fixed by the board, but not to exceed three percent a year.

          C. Years of contributory employment purchased pursuant to this section shall not be considered as an addition to service actually performed in computing the sum of the member's retirement benefit.

          D. The retirement benefits of members retired pursuant to the Educational Retirement Act prior to July 1, 1959 and who have acquired contributory employment years by purchase shall be computed upon the basis of the amount paid therefor.

          E. As used only in this section, "five years of contributory employment" means the member and employer have made contributions through the last business day of the sixtieth month of contributory employment, or if the member is under contract, the member and employer have made contributions for five years through the last business day that the member can provide services under the contract."

     SECTION 4. Section 22-11-31 NMSA 1978 (being Laws 1979, Chapter 333, Section 2, as amended) is amended to read:

     "22-11-31. COST-OF-LIVING ADJUSTMENT--ELIGIBILITY--BASED ON FUNDED RATIO--ADDITIONAL CONTRIBUTIONS.--

          A. For the purposes of this section:

                (1) "adjustment factor" means a multiplicative factor computed to provide an annuity adjustment pursuant to the provisions of Subsection B of this section;

                (2) "annuity" means any benefit payable under the Educational Retirement Act or the Public Employees Retirement Reciprocity Act as a retirement benefit, disability benefit or survivor benefit;

                (3) "calendar year" means the full twelve months beginning January 1 and ending December 31;

                (4) "consumer price index" means the average of the monthly consumer price indexes for a calendar year for the entire United States for all items as published by the United States department of labor;

                (5) "funded ratio" means the ratio of the actuarial value of the assets of the fund to the actuarial accrued liability of the educational retirement system;

                (6) "median adjusted annuity" means the median value of all annuities and retirement benefits paid pursuant to Section 22-11-29 or 22-11-30 NMSA 1978, as calculated each fiscal year; provided, however, that the benefits paid to a member pursuant to Section 22-11-38 NMSA 1978 shall not be included in the median adjusted annuity calculation;

                (7) "next preceding calendar year" means the full calendar year immediately prior to the preceding calendar year; and

                (8) "preceding calendar year" means the full calendar year preceding the July 1 on which a benefit is to be adjusted.

          B. On or after July 1, 1984:

                (1) the annuity of a member who retires pursuant to Subsection A of Section 22-11-23 NMSA 1978 or Subsection A of Section 22-11-23.1 NMSA 1978 shall be adjusted annually and cumulatively commencing on July 1 of the year in which a member attains the age of sixty-five years or on July 1 following the year a member retires, whichever is later; and

                (2) the annuity of a member who retires pursuant to Subsection A of Section 22-11-23.2 NMSA 1978 shall be adjusted annually and cumulatively commencing on July 1 of the year in which the member attains the age of sixty-seven years or on July 1 following the year the member retires, whichever is later.

          C. Beginning on July 1, 2013 and on each July 1 thereafter:

                (1) if the funded ratio of the fund as reported by the board's actuary in the actuarial valuation report for the next preceding fiscal year is one hundred percent or greater, the annuity adjustments provided for under Subsection B of this section shall be adjusted by applying an adjustment factor based on the percentage increase of the consumer price index between the next preceding calendar year and the preceding calendar year. The adjustment factor shall be applied as follows:

                     (a) if the percentage increase of the consumer price index is less than two percent in absolute value, the adjustment factor shall be the same amount as the percentage increase of the consumer price index; and

                     (b) if the percentage increase of the consumer price index is two percent or greater in absolute value, the adjustment factor shall be one-half of the percentage increase; except that the adjustment shall not exceed four percent in absolute value nor be less than two percent in absolute value;

                (2) if the funded ratio of the fund as reported by the board's actuary in the actuarial report for the next preceding fiscal year is greater than ninety percent but less than one hundred percent, except for a member who is on disability status in accordance with Section 22-11-35 NMSA 1978 and whose benefit is adjusted as provided in Subsection G of this section or a member who is retired pursuant to Section 22-11-38 NMSA 1978, the adjustment factor provided for in Subsection B of this section shall be applied as follows:

                     (a) if the percentage increase in the consumer price index is less than two percent in absolute value, for a member who has twenty-five or more years of service credit at retirement and whose annuity is less than or equal to the median adjusted annuity for the fiscal year next preceding the adjustment date, the adjustment factor shall be ninety-five percent of the adjustment factor determined pursuant to Subparagraph (a) of Paragraph (1) of this subsection;

                     (b) if the percentage increase in the consumer price index is less than two percent in absolute value, for a member who has less than twenty-five years of service credit at retirement and whose annuity is less than or equal to the median adjusted annuity for the fiscal year next preceding the adjustment date, and for a member whose annuity is greater than the median adjusted annuity for the fiscal year next preceding the adjustment date, the adjustment factor shall be ninety percent of the adjustment factor determined pursuant to Subparagraph (a) of Paragraph (1) of this subsection;

                     (c) if the percentage increase in the consumer price index is greater than or equal to two percent in absolute value for a member who has twenty-five or more years of service credit at retirement and whose annuity is less than or equal to the median adjusted annuity for the fiscal year next preceding the adjustment date, the adjustment factor shall be ninety-five percent of the adjustment factor determined under Subparagraph (b) of Paragraph (1) of this subsection; and

                     (d) if the percentage increase in the consumer price index is greater than or equal to two percent in absolute value, for a member who has less than twenty-five years of service credit at retirement and whose annuity is less than or equal to the median adjusted annuity for the fiscal year next preceding the adjustment date, and for a member whose annuity is greater than the median adjusted annuity for the fiscal year next preceding the adjustment date, the adjustment factor shall be ninety percent of the adjustment factor determined under Subparagraph (b) of Paragraph (1) of this subsection;

                (3) if the funded ratio of the fund as reported by the board's actuary in the actuarial valuation report for the next preceding fiscal year is ninety percent or less, except for a member who is on disability status in accordance with Section 22-11-35 NMSA 1978 and whose benefit is adjusted as provided in Subsection G of this section or a member who is retired pursuant to Section 22-11-38 NMSA 1978, the adjustment factor provided for in Subsection B of this section shall be applied as follows:

                     (a) if the percentage increase in the consumer price index is less than two percent in absolute value, for a member who has twenty-five or more years of service credit at retirement and whose annuity is less than or equal to the median adjusted annuity for the fiscal year next preceding the adjustment date, the adjustment factor shall be ninety percent of the adjustment factor determined pursuant to Subparagraph (a) of Paragraph (1) of this subsection;

                     (b) if the percentage increase in the consumer price index is less than two percent in absolute value, for a member who has less than twenty-five years of service credit at retirement and whose annuity is less than or equal to the median adjusted annuity for the fiscal year next preceding the adjustment date, and for a member whose annuity is greater than the median adjusted annuity for the fiscal year next preceding the adjustment date, the adjustment factor shall be eighty percent of the adjustment factor determined pursuant to Subparagraph (a) of Paragraph (1) of this subsection;

                     (c) if the percentage increase in the consumer price index is greater than or equal to two percent in absolute value for a member who has twenty-five or more years of service credit at retirement and whose annuity is less than or equal to the median adjusted annuity for the fiscal year next preceding the adjustment date, the adjustment factor shall be ninety percent of the adjustment factor determined under Subparagraph (b) of Paragraph (1) of this subsection; and

                     (d) if the percentage increase in the consumer price index is greater than or equal to two percent in absolute value, for a member who has less than twenty-five years of service credit at retirement and whose annuity is less than or equal to the median adjusted annuity for the fiscal year next preceding the adjustment date, and for a member whose annuity is greater than the median adjusted annuity for the fiscal year next preceding the adjustment date, the adjustment factor shall be eighty percent of the adjustment factor determined under Subparagraph (b) of Paragraph (1) of this subsection; and

                (4) an annuity shall not be decreased if there is a decrease in the consumer price index between the next preceding calendar year and the preceding calendar year.

          D. A retired member whose benefit is subject to adjustment under the provisions of the Educational Retirement Act in effect prior to July 1, 1984 shall have the member's annuity readjusted annually and cumulatively under the provisions of that act in effect prior to July 1, 1984 until July 1 of the year in which the member attains the age of sixty-five years, when the member shall have the annuity readjusted annually and cumulatively under the provisions of this section.

          E. A member who:

                (1) retires pursuant to Subsection A of Section 22-11-23 NMSA 1978 or Subsection A of Section 22-11-23.1 NMSA 1978 after attaining the age of sixty-five years shall have the member's annuity adjusted as provided in Subsections B and C of this section commencing on July 1 of the year following the member's retirement; or

                (2) retires pursuant to Subsection A of Section 22-11-23.2 NMSA 1978 after attaining the age of sixty-seven years shall have the member's annuity adjusted as provided in Subsections B and C of this section commencing on July 1 of the year following the member's retirement.

          F. A retired member who returns to work and suspends retirement shall be subject to the provisions of this section as they exist at the time of the member's latest retirement.

          G. Benefits of a member who is on a disability status in accordance with Section 22-11-35 NMSA 1978 or a member who is certified by the board as disabled at regular retirement shall be adjusted in accordance with Subsections B and C of this section; [except] provided that:

                (1) the benefits shall be adjusted annually and cumulatively commencing on July 1 of the third full year following the year in which the member was approved by the board for disability or retirement; and

                (2) upon attaining the age of sixty years, a member on a disability status who is receiving an annuity adjustment pursuant to this section shall continue to receive the annuity adjustment at the rate of benefits received for the disability."

     SECTION 5. Section 22-11-34 NMSA 1978 (being Laws 1967, Chapter 16, Section 157, as amended) is amended to read:

     "22-11-34. ALLOWED SERVICE CREDIT.--

          A. A member shall be certified to have acquired allowed service credit pursuant to the Internal Revenue Code of 1986 for those periods of time when the member was:

                (1) employed prior to July 1, 1967 in a federal educational program within New Mexico, including United States Indian schools and civilian conservation corps camps. This service credit shall be allowed without contribution;

                (2) engaged in military service that interrupted the member's employment in New Mexico if the member returned to employment within eighteen months following honorable discharge. This service credit shall be allowed without contribution;

                (3) engaged in United States military service or the commissioned corps of the public health service from which the member was honorably discharged; provided that:

                     (a) the member shall have five years or more of contributory employment to be eligible to purchase allowed service credit pursuant to this paragraph;

                     (b) the member shall contribute to the fund, for each year of service credit the member elects to purchase, a sum equal to the member's average annual actual salary for the five years preceding the date of the contribution multiplied by the sum of the member contribution rate and the employer contribution rate in effect at the time of the member's written election to purchase, subject to the federal Uniformed Services Employment and Reemployment Rights Act of 1994;

                     (c) full payment shall be made [in a single lump sum] within [sixty] ninety days of the date that the member is informed of the amount of the payment; and

                     (d) the portion of the purchase cost derived from the employer's contribution rate shall be credited to the fund and, in the event that a member requests a refund of contributions pursuant to Section 22-11-15 NMSA 1978, the member shall not be entitled to a refund of that portion of the purchase cost derived from the employer contribution rate; or

                (4) employed:

                     (a) in a public school or public institution of higher learning in another state, territory or possession of the United States;

                     (b) in a United States military dependents' school operated by a branch of the armed forces of the United States;

                     (c) as provided in Paragraph (1) of this subsection after July 1, 1967; or

                     (d) in a private school or institution of higher learning in New Mexico whose education program is accredited or approved by the department at the time of employment.

          B. Effective July 1, 2001, the member or employer under Paragraph (4) of Subsection A of this section shall contribute to the fund for each year of allowed service credit desired an amount equal to the actuarial value of the service purchased as defined by the board. No allowed service credit shall be purchased pursuant to Paragraph (4) of Subsection A of this section unless the member is currently employed by a local administrative unit.

          C. No member shall be certified to have acquired allowed service credit:

                (1) under any single paragraph or the combination of only Paragraphs (1) and (4) or only Paragraphs (2) and (3) of Subsection A of this section in excess of five years; or

                (2) in excess of ten years for any other combination of Paragraphs (1) through (4) of Subsection A of this section.

          D. A member receiving service credit under Paragraph (3) or (4) of Subsection A of this section who enrolls in the retiree health care authority shall make contributions pursuant to Subsection C of Section 10-7C-15 NMSA 1978."

     SECTION 6. Section 22-11-55 NMSA 1978 (being Laws 2009, Chapter 240, Section 1 and Laws 2009, Chapter 248, Section 1, as amended) is amended to read:

     "22-11-55. DISCLOSURE OF MEMBER OR RETIRED MEMBER INFORMATION--PENALTY.--

          A. Other than names of members and local administrative units by which a member was employed; dates of employment, retirement and reported death; service credit; reported salary; retirement and disability benefits; and amounts of contributions made by members and local administrative units, neither the board nor its employees or contractors shall allow public inspection or disclosure of any information regarding a member or retired member to anyone except:

                (1) the member, retired member or the spouse or authorized representative of the member or retired member;

                (2) other persons specifically identified in a prior release and consent, in the form prescribed by the board, executed by the member, retired member, spouse or authorized representative; [or]

                (3) the attorney general, appropriate law enforcement agencies, the state auditor or the public education department or higher education department, if the information provided relates to contributions, payments or management of money received by, or the financial controls or procedures of, a local administrative unit; or

                (4) the public employees retirement board for the purpose of administering the Public Employees Retirement Reciprocity Act.

          B. No person receiving information disclosed by a violation of Subsection A of this section shall disclose that information to any other person unless authorized by an applicable confidentiality agreement, board rule or state law.

          C. Whoever knowingly violates a provision of Subsection A or B of this section is guilty of a petty misdemeanor and shall be sentenced in accordance with Section 31-19-1 NMSA 1978."

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