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SPONSOR: |
Maes |
DATE TYPED: |
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HB |
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SHORT TITLE: |
Municipal Detention Officer Retirement |
SB |
764/aSFC/aHBIC |
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ANALYST: |
Gilbert |
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APPROPRIATION
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Appropriation
Contained |
Estimated
Additional Impact |
Recurring or
Non-Rec |
Fund Affected |
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FY03 |
FY04 |
FY03 |
FY04
|
|
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$0.1
See Narrative |
Recurring |
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|
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$0.1
See Narrative |
Recurring |
PERA |
(Parenthesis
( ) Indicate Expenditure Decreases)
Relation to SB 577, HB 116, HB 774, HB 611,
SB 591
LFC Files
Responses
Received From
Public
Employees Retirement Association (PERA)
SUMMARY
Synopsis
of HBIC Amendment
House Labor and Human Resources Committee
amendment to Senate Bill 764 automatically implements this new plan after
Municipal
detention officer member coverage plan 1 is applicable to municipal detention
officer members employed in a class A county with a population greater than
four hundred thousand and is effective on the later of July 1, 2004 or
the first day of the calendar month following certification of the
election adopting municipal detention officer member coverage plan 1 by an
affirmative vote of the majority of the affiliated public employer's municipal
detention officer members.
HBIC amendment to SB 764 also strikes SFC
amendment 4 which changed the effective date for implementation of the new
state municipal detention officer member coverage plan from
Synopsis
of SFC Amendment
Senate Finance Committee amendment to Senate
Bill 764 strikes subsection (b) from the definition of “hazardous duty member”:
(b) a member who is a juvenile correctional officer
employed by the children, youth and families department or its successor
agency;
SB 764/aSFC also amends the effective date for
implementation of the new state municipal detention officer member coverage
plan from
Synopsis
of Original Bill
Senate Bill 764 adds a
new state municipal detention officer member coverage plan for municipal
detention officers employed by in a class A county with a population greater
than 400,000. If approved by an election
of the affected membership, this plan will allow members to retire at any age
with 20 years of service credit, a 3.5% percent pension factor and an 80% of
final average salary maximum pension annuity.
Under this plan,
member and employer contributions contributions would be 17.2% for a total of
34.4% of salary. This represents a 4.05
% increase in employee contributions and 8.05 % increase in employer
contributions.
Prior to being eligible for the benefits in this
plan, members must be municipal detention officers in a class A county for
three years.
Significant
Issues
Currently, statewide detention officers employed
by public-affiliated employers other than the state are covered under municipal
general coverage plans 1, 2 and 3. All
statewide detention officers are eligible to retire at any age with 25 or more
years of service credit and, depending on which plan they are under, pay
between 7% and 13.15% of their salary in contributions. Employers pay between 7 % and 9.15% of salary
in contributions, depending on the relevant coverage plan.
PERA’s
actuary completed a study to determine the actuarial cost of benefits contained
in SB 764, specifically for
SB 764 contains the
required 12.1% contribution increase and is adequately funded from PERA‘s perspective for the added benefits. However, this bill could result in
significant fiscal impact to
If this bill is
adopted, PERA must implement the new plan, amend its regulations and update
member informational publications. PERA
believes that it can absorb this impact.
Since PERA is in the
process of implementing a new computer information system, the addition of
another coverage plan may increase the cost of this project.
TECHNICAL ISSUES
Page 3, line 16, removes “a state policeman” from the definition of “hazardous duty member.” According to PERA, “State policeman” is considered a “hazardous duty member” for federal Social Security Act purposes.
OTHER SUBSTANTIVE ISSUES
Only municipal detention officers employed by class A counties are eligible for the benefits proposed by SB 764. According to PERA, this conflicts with the general concept of a defined benefit plan; similarly situated members should earn and receive similar benefits. SB 764 precludes other municipal detention officers from coverage under this plan.
HB 116 and HB 611
improve retirement benefits for hazardous duty members.
HB 774, SB 577, and SB
591 create new municipal detention officers retirement plans.
RLG/prr:yr