HOUSE BILL 573
49th legislature - STATE OF NEW MEXICO - first session, 2009
INTRODUCED BY
John A. Heaton
FOR THE LEGISLATIVE FINANCE COMMITTEE
AN ACT
RELATING TO THE RETIREMENT OF PUBLIC EMPLOYEES; AMENDING THE EDUCATIONAL RETIREMENT ACT TO CHANGE RETIREMENT ELIGIBILITY REQUIREMENTS FOR NEW MEMBERS, TO REQUIRE FINANCIAL TRAINING FOR BOARD MEMBERS AND TO PROVIDE A LIMIT ON THE CALCULATION OF AVERAGE ANNUAL SALARY; AMENDING THE PUBLIC EMPLOYEES RETIREMENT ACT TO CHANGE RETIREMENT ELIGIBILITY REQUIREMENTS FOR NEW MEMBERS, TO REQUIRE FINANCIAL TRAINING FOR BOARD MEMBERS, TO PROVIDE A LIMIT ON THE CALCULATION OF FINAL AVERAGE SALARY, TO ADJUST THE CALCULATION OF SERVICE CREDIT UNDER CERTAIN RETIREMENT PLANS AND TO CHANGE THE REQUIREMENTS FOR RETURNING TO WORK AFTER RETIREMENT; AMENDING THE RETIREE HEALTH CARE ACT TO INCREASE CERTAIN CONTRIBUTION RATES FROM CERTAIN MEMBERS AND TO REQUIRE ADDITIONAL CONTRIBUTIONS FROM EMPLOYEES WHO HAVE ACCRUED CERTAIN SERVICE CREDITS; RECONCILING MULTIPLE AMENDMENTS TO THE SAME SECTIONS OF LAW IN LAWS 2003; RECONCILING CONFLICTING AMENDMENTS TO THE SAME SECTION OF LAW BY REPEALING LAWS 2004, CHAPTER 2, SECTION 1.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF NEW MEXICO:
Section 1. Section 10-7C-15 NMSA 1978 (being Laws 1990, Chapter 6, Section 15, as amended) is amended to read:
"10-7C-15. RETIREE HEALTH CARE FUND CONTRIBUTIONS.--
A. Following completion of the preliminary contribution period, each participating employer shall make contributions to the fund in the amount of:
[(1) one percent of each participating employee's annual salary for the period July 1, 1990 through June 30, 2002; and
(2) up to] (1) one and three-tenths percent of each participating employee's [annual salary beginning July 1, 2002] salary; and
(2) an additional three hundred twenty-five thousandths of one percent of the salary paid on or after July 1, 2009 to each participating employee who was a member of an enhanced retirement plan on June 30, 2009.
Each employer that chooses to become a participating employer after January 1, 1998 shall make contributions to the fund in the amount determined to be appropriate by the board.
B. Following completion of the preliminary contribution period, each participating employee, as a condition of employment, shall contribute to the fund an employee contribution in an amount equal to:
[(1) one-half of one percent of the employee's salary for the period July 1, 1990 through June 30, 2002; and
(2) up to sixty-five hundredths of one percent beginning July 1, 2002]
(1) sixty-five hundredths of one percent of the employee's salary; and
(2) an additional sixteen hundredths of one percent of the salary paid on or after July 1, 2009 to the employee if the employee was a member of an enhanced retirement plan on June 30, 2009.
As a condition of employment, each participating employee of an employer that chooses to become a participating employer after January 1, 1998 shall contribute to the fund an amount that is determined to be appropriate by the board. Each month, participating employers shall deduct the contribution from the participating employee's salary and shall remit it to the board as provided by any procedures that the board may require.
C. On or after July 1, 2009, no person shall obtain service credit pursuant to Section 10-11-6, 10-11-7 or 22-11-34 NMSA 1978 unless the person makes a contribution to the fund equal to the full actuarial present value of the amount of the increase in the person's health care benefit, as determined by the authority.
[C.] D. Except for contributions made pursuant to Subsection C of this section, a participating employer that fails to remit before the tenth day after the last day of the month all employer and employee deposits required by the Retiree Health Care Act to be remitted by the employer for the month shall pay to the fund, in addition to the deposits, interest on the unpaid amounts at the rate of six percent per year compounded monthly.
[D.] E. Except for contributions made pursuant to Subsection C of this section, the employer and employee contributions shall be paid in monthly installments based on the percent of payroll certified by the employer.
[E.] F. Except in the case of erroneously made contributions or as may be otherwise provided in Subsection D of Section 10-7C-9 NMSA 1978, contributions from participating employers and participating employees shall become the property of the fund on receipt by the board and shall not be refunded under any circumstances, including termination of employment or termination of the participating employer's operation or participation in the Retiree Health Care Act.
[F. Notwithstanding any other provision in the Retiree Health Care Act and at the first session of the legislature following July 1, 2010, the legislature shall review and adjust the distribution pursuant to Section 7-1-6.1 NMSA 1978 and the employer and employee contributions to the authority in order to ensure the actuarial soundness of the benefits provided under the Retiree Health Care Act.] G. As used in this section, "member of an enhanced retirement plan" means a member of the public employees retirement association who, pursuant to the Public Employees Retirement Act, is included in:
(1) state police member and adult correctional officer member coverage plan 1;
(2) municipal police member coverage plan 3, 4 or 5;
(3) municipal fire member coverage plan 3, 4 or 5; or
(4) municipal detention officer member coverage plan 1."
Section 2. Section 10-11-6 NMSA 1978 (being Laws 1987, Chapter 253, Section 6, as amended) is amended to read:
"10-11-6. CREDITED SERVICE--CREDIT FOR INTERVENING MILITARY AND UNITED STATES GOVERNMENT SERVICE.--
A. A member who leaves the employ of an affiliated public employer to enter a uniformed service of the United States shall be given service credit for periods of service in the uniformed services subject to the following conditions:
(1) the member is reemployed by an affiliated public employer within ninety days following termination of the period of intervening [serving] service in the uniformed service or the affiliated employer certifies in writing to the association that the member is entitled to reemployment rights under the federal Uniformed Services Employment and Reemployment Rights Act of 1994;
(2) the member retains membership in the association during the period of service in the uniformed services;
(3) free service credit shall not be given for periods of intervening service in the uniformed services following voluntary reenlistment. Service credit for such periods shall be given only after the member pays the association the sum of the contributions that the person would have been required to contribute had the person remained continuously employed throughout the period of intervening service following voluntary reenlistment, which payment shall be made during the period beginning with the date of reemployment and whose duration is three times the period of the person's intervening service in the uniformed services following voluntary reenlistment, not to exceed five years; (4) the member makes a contribution to the retiree health care fund pursuant to Subsection C of Section 10-7C-15 NMSA 1978;
[(4)] (5) service credit shall not be given for periods of intervening service in the uniformed services that are used to obtain or increase a benefit from another state system or the retirement program provided under the Educational Retirement Act; [and
(5)] (6) the member must not have received a discharge or separation from uniformed service under other than honorable conditions; and
(7) notwithstanding any provision of this plan to the contrary, contributions, benefits and service credit with respect to qualified military service will be provided in accordance with Section 414(u) of the Internal Revenue Code of 1986, as amended.
B. For a member who is subsequently employed by the government of the United States within thirty days of leaving the employ of an affiliated public employer:
(1) that member may continue membership in the association subject to the following conditions:
(a) the member has fifteen or more years of credited service;
(b) employment by the government of the United States commences within ninety days of termination of employment with the last affiliated public employer;
(c) the member files with the association a written application for continued membership within ninety days of termination of employment with the last affiliated public employer; [and]
(d) the member remits to the association, at the times and in the manner prescribed by the association, the member contributions and the employer contributions that would have been made had the member continued in the employ of the last affiliated public employer; and
(e) the member makes a contribution to the retiree health care fund pursuant to Subsection C of Section 10-7C-15 NMSA 1978;
(2) the contributions required by Paragraph (1) of this subsection shall be based on a salary equal to the member's monthly salary at time of termination of employment with the last affiliated public employer;
(3) credited service will be determined as if the employment by the government of the United States was rendered the last affiliated public employer; and
(4) the employer contributions remitted by the member shall be credited to the [employer] employer's accumulation fund and shall not be paid out of the association in the event of subsequent cessation of membership."
Section 3. Section 10-11-7 NMSA 1978 (being Laws 1987, Chapter 253, Section 7, as amended) is amended to read:
"10-11-7. CREDITED SERVICE--PURCHASE OF SERVICE.--
A. A member who entered a uniformed service of the United States may purchase service credit for periods of active duty in the uniformed services subject to the following conditions:
(1) the member pays the association the purchase cost determined according to Subsection E of this section;
(2) the member has five or more years of service credit acquired as a result of personal service rendered in the employ of an affiliated public employer;
(3) the aggregate amount of service credit purchased pursuant to this subsection does not exceed five years reduced by any period of service credit acquired for military service pursuant to any other provision of the Public Employees Retirement Act;
(4) service credit may not be purchased for periods of service in the uniformed services that are used to obtain or increase a benefit from another retirement program; [and]
(5) the member must not have received a discharge or separation from uniformed service under other than honorable conditions; and
(6) the member makes a contribution to the retiree health care fund pursuant to Subsection C of Section 10-7C-15 NMSA 1978.
B. A member who was a civilian prisoner of war captured while in service to the United States as an employee of the federal government or as an employee of a contractor with the federal government may purchase service credit for the period of internment as a civilian prisoner of war, provided that:
(1) the member provides proof of employment with the federal government or as a contractor to the federal government in a form acceptable to the association;
(2) the member provides proof of the period of internment in a form acceptable to the association;
(3) the member has at least five years of service credit acquired as a result of personal service rendered in the employ of an affiliated public employer;
(4) the aggregate amount of service credit purchased pursuant to this subsection does not exceed five years reduced by any period of service credit acquired for military service pursuant to any other provision of the Public Employees Retirement Act;
(5) service credit may not be purchased for periods of service in internment as a civilian prisoner of war if such periods are used to obtain or increase a benefit from another retirement program; [and]
(6) the member pays the association the purchase cost determined according to Subsection E of this section; and
(7) the member makes a contribution to the retiree health care fund pursuant to Subsection C of Section 10-7C-15 NMSA 1978.
C. A member who was employed by a utility company, library, museum, transit company or nonprofit organization administering federally funded public service programs, which utility company, library, museum, transit company or nonprofit organization administering federally funded public service programs or federally funded public service programs administered by a nonprofit organization are subsequently taken over by an affiliated public employer, or a member who was employed by an entity created pursuant to a joint powers agreement between two or more affiliated public employers for the purpose of administering or providing drug or alcohol addiction treatment services irrespective of whether the entity is subsequently taken over by an affiliated public employer, may purchase credited service for the period of employment subject to the following conditions:
(1) the member pays the association the purchase cost determined according to Subsection E of this section;
(2) the member makes a contribution to the retiree health care fund pursuant to Subsection C of Section 10-7C-15 NMSA 1978;
[(2)] (3) the member has five or more years of credited service acquired as a result of personal service rendered in the employ of an affiliated public employer; and
[(3)] (4) the aggregate amount of credited service purchased pursuant to this subsection does not exceed five years.
D. A member who was appointed to participate in a cooperative work study training program established jointly by a state agency and a state post-secondary educational institution may purchase credited service for the period of participation subject to the following conditions:
(1) the member pays the association the full actuarial present value of the amount of the increase in the employee's pension as a consequence of the purchase as determined by the association;
(2) the member pays the full cost of the purchase within sixty days of the date the member is informed of the amount of the payment;
(3) the member makes a contribution to the retiree health care fund pursuant to Subsection C of Section 10-7C-15 NMSA 1978;
[(3)] (4) the member has five or more years of credited service acquired as a result of personal service rendered in the employ of an affiliated public employer; and
[(4)] (5) the aggregate amount of credited service purchased pursuant to this subsection does not exceed five years.
E. Except for service to be used under a state legislator coverage plan, the purchase cost for each month of credited service purchased pursuant to the provisions of this section is equal to the member's final average salary multiplied by the sum of the member contribution rate and employer contribution rate, determined in accordance with the coverage plan applicable to the member at the time of the written election to purchase. The purchase cost for each year of credited service to be used under a state legislator coverage plan is equal to three times the normal member contribution per year of credited service under the state legislator coverage plan applicable to the member. Full payment shall be made in a single lump sum within sixty days of the date the member is informed of the amount of the payment. The portion of the purchase cost derived from the employer contribution rate shall be credited to the employer's accumulation fund and shall not be paid out of the association in the event of cessation of membership. In no case shall a member be credited with a month of service for less than the purchase cost as defined in this section.
F. A member shall be refunded, upon written request filed with the association, the portion of the purchase cost of credited service purchased pursuant to this section that the association determines to have been unnecessary to provide the member with the maximum pension applicable to the member. The association shall not pay interest on the portion of the purchase cost refunded to the member.
G. A member of the magistrate retirement system who during the member's service as a magistrate was eligible to become a member of the public employees retirement system and elected not to become a member of that system may purchase service credit pursuant to the public employees retirement system for the period for which the magistrate elected not to become a public employees retirement system member, by paying the amount of the increase in the actuarial present value of the magistrate pension as a consequence of the purchase as determined by the association. Full payment shall be made in a single lump-sum amount in accordance with procedures established by the retirement board. Except as provided in Subsection F of this section, seventy-five percent of the purchase cost shall be considered to be employer contributions and shall not be refunded to the member in the event of cessation of membership. The member shall also make a contribution to the retiree health care fund pursuant to Subsection C of Section 10-7C-15 NMSA 1978.
H. At any time prior to retirement, any member may purchase service credit in monthly increments, subject to the following conditions:
(1) the member has at least five years of service credit acquired as a result of personal service rendered in the employ of an affiliated public employer;
(2) the aggregate amount of service credit purchased pursuant to this subsection does not exceed one
year;
(3) the member pays full actuarial present value of the amount of the increase in the employee's pension as a consequence of the purchase as determined by the association;
(4) the member pays the full cost of the purchase within sixty days of the date the member is informed of the amount of the payment; [and]
(5) the member makes a contribution to the retiree health care fund pursuant to Subsection C of Section 10-7C-15 NMSA 1978; and
[(5)] (6) the purchase of service under this subsection cannot be used to determine the final average salary or the pension factor or be used to exceed the pension maximum."
Section 4. Section 10-11-8 NMSA 1978 (being Laws 1987, Chapter 253, Section 8, as amended by Laws 2004, Chapter 2, Section 1 and by Laws 2004, Chapter 68, Section 4) is amended to read:
"10-11-8. NORMAL RETIREMENT--RETURN TO EMPLOYMENT--BENEFITS CONTINUED--EMPLOYER CONTRIBUTIONS.--
A. A member may retire upon fulfilling the following requirements prior to the selected date of retirement:
(1) a written application for normal retirement, in the form prescribed by the association, is filed with the association;
(2) employment is terminated with all employers covered by any state system or the educational retirement system;
(3) the member selects an effective date of retirement that is the first day of a calendar month; and
(4) the member meets the age and service credit requirement for normal retirement specified in the coverage plan applicable to the member.
B. The amount of normal retirement pension is determined in accordance with the coverage plan applicable to the member.
C. Except as provided in Subsection D or E of this section, a retired member may be subsequently employed by an affiliated public employer if the following conditions apply:
(1) for a retired member who returns to work prior to July 1, 2009 or a retired member who returns to work after that date pursuant to Paragraph (2) of this subsection, the member shall not have been employed as an employee of an affiliated public employer for at least ninety consecutive days from the date of retirement to the commencement of employment or reemployment with an affiliated public employer and, except as provided in Paragraph (2) of this subsection, for a retired member who returns to employment on or after July 1, 2009, the member [has] shall not have been employed as an employee of an affiliated public employer for at least [ninety consecutive days] twelve consecutive months from the date of retirement [to the commencement of employment or reemployment with an affiliated public employer]. If the retired member returns to employment without first completing the required ninety consecutive days or twelve consecutive months of retirement:
(a) the retired member's pension shall be suspended immediately and the previously retired member shall become a member; and
(b) upon termination of the subsequent employment, the previously retired member's pension shall be calculated pursuant to Paragraph (2) of Subsection E of this section;
[(2) effective the first day of the month following the month in which the retired member's earnings total twenty-five thousand dollars ($25,000) during a calendar year]
(2) a retired member may return to work after July 1, 2009 without the twelve-month retirement otherwise required by Paragraph (1) of this subsection if the affiliated public employer is a political subdivision of the state whose governing body has adopted a resolution declaring that the subsequent employment of the retired member will fill a critical need of the political subdivision and the employment is for a term of two years or less; provided, however, that the governing body may renew the employment by passing a resolution declaring a continuing need;
(3) a retired member who returns to employment shall be required to make contributions to the fund as specified in the Public Employees Retirement Act; [provided, however, that after December 31, 2006, no additional contributions shall be required pursuant to this paragraph;
(3)] (4) until the subsequent employment is terminated, the affiliated public employer that employs the retired member shall make contributions to the fund in the amount specified in the Public Employees Retirement Act; [or in a higher amount adjusted for full actuarial cost as determined annually by the association; and]
(4)] (5) a retired member who returns to employment during retirement pursuant to this subsection is entitled to receive retirement benefits but is not entitled to acquire service credit or to acquire or purchase service credit in the future for the period of the retired member's reemployment with an affiliated public employer; and
(6) until the subsequent employment is terminated, both the retired member and the affiliated public employer that employs the retired member shall make contributions to the retiree health care fund in the amount specified in Subsections A and B of Section 10-7C-15 NMSA 1978.
D. The provisions of Paragraphs [(2) and] (3) and (4) of Subsection C of this section that require employee or employer contributions do not apply to:
(1) a retired member who is appointed chief of police of an affiliated public employer, other than the affiliated public employer from which the retired member retired, or who is appointed undersheriff; provided that:
(a) the retired member files an irrevocable exemption from membership with the association within thirty days of appointment;
(b) each sheriff's office shall be limited to one undersheriff qualifying pursuant to this paragraph;
(c) the irrevocable exemption shall be for the chief of police's or the undersheriff's term of office; and
(d) filing an irrevocable exemption shall irrevocably bar the retired member from acquiring service credit for the period of exemption from membership; or
(2) a retired member employed by the legislature for legislative session work.
E. At any time during a retired member's subsequent employment pursuant to Subsection C of this section, the retired member may elect to suspend the pension. When the pension is suspended, the following conditions shall apply:
(1) the retired member who is subsequently employed by an affiliated public employer shall become a member. The previously retired member and the subsequent affiliated public employer shall make the required employee and employer contributions, and the previously retired member shall accrue service credit for the period of subsequent employment; and
(2) when a previously retired member terminates the subsequent employment with an affiliated public employer, [he] the previously retired member shall retire according to the provisions of the Public Employees Retirement Act, subject to the following conditions:
(a) payment of the pension shall resume in accordance with the provisions of Subsection A of this section;
(b) unless the previously retired member accrued at least three years of service credit on account of the subsequent employment, the recalculation of pension shall: 1) employ the form of payment selected by the previously retired member at the time of the first retirement; and 2) use the provisions of the coverage plan applicable to the member on the date of the first retirement; and
(c) the recalculated pension shall not be less than the amount of the suspended pension.
F. The pension of a member who has three or more years of service credit under each of two or more coverage plans shall be determined in accordance with the coverage plan that produces the highest pension. The pension of a member who has service credit under two or more coverage plans but who has three or more years of service credit under only one of those coverage plans shall be determined in accordance with the coverage plan in which the member has three or more years of service credit. If the service credit is acquired under two different coverage plans applied to the same affiliated public employer as a consequence of an election by the members, adoption by the affiliated public employer or a change in the law that results in the application of a coverage plan with a greater pension, the greater pension shall be paid a member retiring from the affiliated public employer under which the change in coverage plan took place regardless of the amount of service credit under the coverage plan producing the greater pension; provided the member has three or more years of continuous employment with that affiliated public employer immediately preceding or immediately preceding and immediately following the date the coverage plan changed. The provisions of each coverage plan for the purpose of this subsection shall be those in effect at the time the member ceased to be covered by the coverage plan. "Service credit", for the purposes of this subsection, shall be only personal service rendered an affiliated public employer and credited to the member under the provisions of Subsection A of Section 10-11-4 NMSA 1978. Service credited under any other provision of the Public Employees Retirement Act shall not be used to satisfy the three-year service credit requirement of this subsection."
Section 5. Section 10-11-26.2 NMSA 1978 (being Laws 1994, Chapter 128, Section 3) is amended to read:
"10-11-26.2. STATE GENERAL MEMBER COVERAGE PLAN 3--AGE AND SERVICE CREDIT REQUIREMENTS FOR NORMAL RETIREMENT.--
A. Under state general member coverage plan 3:
(1) for a member who is a peace officer and for a member who is not a peace officer but was a retired member or a member on June 30, 2009, the age and service credit requirements for normal retirement are:
[A.] (a) age sixty-five years or older and five or more years of service credit;
[B.] (b) age sixty-four years and eight or more years of service credit;
[C.] (c) age sixty-three years and eleven or more years of service credit;
[D.] (d) age sixty-two years and fourteen or more years of service credit;
[E.] (e) age sixty-one years and seventeen or more years of service credit;
[F.] (f) age sixty years and twenty or more years of service credit; and
[G.] (g) any age and twenty-five or more years of service credit; and
(2) for a member who is not a peace officer and was not a retired member or a member on June 30, 2009, the age and service requirements for normal retirement are:
(a) age sixty-seven years or older and five or more years of service credit;
(b) age sixty-six years and seven or more years of service credit;
(c) age sixty-five years and eight or more years of service credit;
(d) age sixty-four years and ten or more years of service credit;
(e) age sixty-three years and thirteen or more years of service credit;
(f) age sixty-two years and sixteen or more years of service credit;
(g) age sixty-one years and nineteen or more years of service credit;
(h) age sixty years and twenty or more years of service credit; or
(i) age fifty-five years or older and thirty or more years of service credit.
B. As used in this section, "peace officer" means any employee of the state with a duty to maintain public order or to make arrests for crime, whether that duty extends to all crimes or is limited to specific crimes, and who is not specifically covered by another coverage plan."
Section 6. Section 10-11-27 NMSA 1978 (being Laws 1987, Chapter 253, Section 27, as amended by Laws 2003, Chapter 268, Section 9 and by Laws 2003, Chapter 269, Section 1) is amended to read:
"10-11-27. STATE POLICE MEMBER AND ADULT CORRECTIONAL OFFICER MEMBER COVERAGE PLAN 1--APPLICABILITY.--
A. State police member and adult correctional officer member coverage plan 1 is applicable to state police members who are not specifically covered by another coverage plan and to adult correctional officer members. [The credited service of a state police member who has held the permanent rank of patrolman, sergeant, lieutenant or captain and does not hold an exempt rank or who is assigned to the aircraft division as a pilot, or of an adult correctional officer member, shall have actual credited service increased by twenty percent] For the purposes of state police member and adult correctional officer member coverage plan 1, a member shall have actual credited service increased by twenty percent if that member was a retired member or a member on June 30, 2009 and:
(1) is a state police member who holds the permanent rank of patrolman, sergeant, lieutenant or captain and does not hold an exempt rank;
(2) is a state police member who is assigned to the aircraft division as a pilot; or
(3) is an adult correctional officer member.
B. The increased credited service provided in Subsection A of this section may be used only for the purposes of state police member and adult correctional officer member coverage plan 1, and, if a member transfers or otherwise becomes subject to another coverage plan, only the actual credited service, rather than the increased credited service, may be used to determine retirement eligibility under that other plan.
[B.] C. State police member and adult correctional officer member coverage plan 1 is applicable to adult correctional officer members in the first full pay period after July 1, 2004 if the retirement board certifies to the secretary of state that, of those adult correctional officer members to be covered under state police member and adult correctional officer member coverage plan 1, a majority of the members voting have voted to approve adoption of that plan at an election conducted pursuant to [Section 16 of this 2003 act] Laws 2003, Chapter 268, Section 16."
Section 7. Section 10-11-45 NMSA 1978 (being Laws 1987, Chapter 253, Section 45) is amended to read:
"10-11-45. MUNICIPAL GENERAL MEMBER COVERAGE PLAN 1--AGE AND SERVICE REQUIREMENTS FOR NORMAL RETIREMENT.--Under municipal general member coverage plan 1:
A. for a member who was a retired member or a member on June 30, 2009, the age and service requirements for normal retirement are:
[A.] (1) age sixty-five years or older and five or more years of credited service;
[B.] (2) age sixty-four years and eight or more years of credited service;
[C.] (3) age sixty-three years and eleven or more years of credited service;
[D.] (4) age sixty-two years and fourteen or more years of credited service;
[E.] (5) age sixty-one years and seventeen or more years of credited service;
[F.] (6) age sixty years and twenty or more years of credited service; or
[G.] (7) any age and twenty-five or more years of credited service; and
B. for a member who was not a retired member or a member on June 30, 2009, the age and service requirements for normal retirement are:
(1) age sixty-seven years or older and five or more years of service credit;
(2) age sixty-six years and seven or more years of service credit;
(3) age sixty-five years and eight or more years of service credit;
(4) age sixty-four years and ten or more years of service credit;
(5) age sixty-three years and thirteen or more years of service credit;
(6) age sixty-two years and sixteen or more years of service credit;
(7) age sixty-one years and nineteen or more years of service credit;
(8) age sixty years and twenty or more years of service credit; or
(9) age fifty-five years or older and thirty or more years of service credit."
Section 8. Section 10-11-51 NMSA 1978 (being Laws 1987, Chapter 253, Section 51) is amended to read:
"10-11-51. MUNICIPAL GENERAL MEMBER COVERAGE PLAN 2--AGE AND SERVICE REQUIREMENTS FOR NORMAL RETIREMENT.--Under municipal general member coverage plan 2:
A. for a member who was a retired member or a member on June 30, 2009, the age and service requirements for normal retirement are:
[A.] (1) age sixty-five years or older and five or more years of credited service;
[B.] (2) age sixty-four years and eight or more years of credited service;
[C.] (3) age sixty-three years and eleven or more years of credited service;
[D.] (4) age sixty-two years and fourteen or more years of credited service;
[E.] (5) age sixty-one years and seventeen or more years of credited service;
[F.] (6) age sixty years and twenty or more years of credited service; or
[G.] (7) any age and twenty-five or more years of credited service; and
B. for a member who was not a retired member or a member on June 30, 2009, the age and service requirements for normal retirement are:
(1) age sixty-seven years or older and five or more years of service credit;
(2) age sixty-six years and seven or more years of service credit;
(3) age sixty-five years and eight or more years of service credit;
(4) age sixty-four years and ten or more years of service credit;
(5) age sixty-three years and thirteen or more years of service credit;
(6) age sixty-two years and sixteen or more years of service credit;
(7) age sixty-one years and nineteen or more years of service credit;
(8) age sixty years and twenty or more years of service credit; or
(9) age fifty-five years or older and thirty or more years of service credit."
Section 9. Section 10-11-55.2 NMSA 1978 (being Laws 1993, Chapter 58, Section 2) is amended to read:
"10-11-55.2. MUNICIPAL GENERAL MEMBER COVERAGE PLAN 3--AGE AND SERVICE REQUIREMENTS FOR NORMAL RETIREMENT.--Under municipal general member coverage plan 3:
A. for a member who was a retired member or a member on June 30, 2009, the age and service requirements for normal retirement are:
[A.] (1) age sixty-five years or older and five or more years of credited service;
[B.] (2) age sixty-four years and eight or more years of credited service;
[C.] (3) age sixty-three years and eleven or more years of credited service;
[D.] (4) age sixty-two years and fourteen or more years of credited service;
[E.] (5) age sixty-one years and seventeen or more years of credited service;
[F.] (6) age sixty years and twenty or more years of credited service; or
[G.] (7) any age and twenty-five or more years of credited service; and
B. for a member who was not a retired member or a member on June 30, 2009, the age and service requirements for normal retirement are:
(1) age sixty-seven years or older and five or more years of service credit;
(2) age sixty-six years and seven or more years of service credit;
(3) age sixty-five years and eight or more years of service credit;
(4) age sixty-four years and ten or more years of service credit;
(5) age sixty-three years and thirteen or more years of service credit;
(6) age sixty-two years and sixteen or more years of service credit;
(7) age sixty-one years and nineteen or more years of service credit;
(8) age sixty years and twenty or more years of service credit; or
(9) age fifty-five years or older and thirty or more years of service credit."
Section 10. Section 10-11-55.8 NMSA 1978 (being Laws 1998, Chapter 106, Section 2) is amended to read:
"10-11-55.8. MUNICIPAL GENERAL MEMBER COVERAGE PLAN 4--AGE AND SERVICE REQUIREMENTS FOR NORMAL RETIREMENT.--Under municipal general member coverage plan 4:
A. for a member who was a retired member or a member on June 30, 2009, the age and service requirements for normal retirement are:
[A.] (1) age sixty-five years or older and five or more years of credited service;
[B.] (2) age sixty-four years and eight or more years of credited service;
[C.] (3) age sixty-three years and eleven or more years of credited service;
[D.] (4) age sixty-two years and fourteen or more years of credited service;
[E.] (5) age sixty-one years and seventeen or more years of credited service;
[F.] (6) age sixty years and twenty or more years of credited service; or
[G.] (7) any age and twenty-five or more years of credited service; and
B. for a member who was not a retired member or a member on June 30, 2009, the age and service requirements for normal retirement are:
(1) age sixty-seven years or older and five or more years of service credit;
(2) age sixty-six years and seven or more years of service credit;
(3) age sixty-five years and eight or more years of service credit;
(4) age sixty-four years and ten or more years of service credit;
(5) age sixty-three years and thirteen or more years of service credit;
(6) age sixty-two years and sixteen or more years of service credit;
(7) age sixty-one years and nineteen or more years of service credit;
(8) age sixty years and twenty or more years of service credit; or
(9) age fifty-five years or older and thirty or more years of service credit."
Section 11. Section 10-11-69 NMSA 1978 (being Laws 1987, Chapter 253, Section 69) is amended to read:
"10-11-69. MUNICIPAL POLICE MEMBER COVERAGE PLAN 3--AGE AND SERVICE REQUIREMENTS FOR NORMAL RETIREMENT.--Under municipal police member coverage plan 3, the age and service requirements for normal retirement are:
A. age sixty-five years or older and five or more years of credited service;
B. age sixty-four years and eight or more years of credited service;
C. age sixty-three years and eleven or more years of credited service;
D. age sixty-two years and fourteen or more years of credited service;
E. age sixty-one years and seventeen or more years of credited service; [or]
F. any age and twenty or more years of credited service for an individual who was a retired member or a member on June 30, 2009; or
G. any age and twenty-five or more years of credited service for an individual who was not a retired member or a member on June 30, 2009."
Section 12. Section 10-11-75 NMSA 1978 (being Laws 1987, Chapter 253, Section 75) is amended to read:
"10-11-75. MUNICIPAL POLICE MEMBER COVERAGE PLAN 4--AGE AND SERVICE REQUIREMENTS FOR NORMAL RETIREMENT.--Under municipal police member coverage plan 4, the age and service requirements for normal retirement are:
A. age sixty-five years or older and five or more years of credited service;
B. age sixty-four years and eight or more years of credited service;
C. age sixty-three years and eleven or more years of credited service;
D. age sixty-two years and fourteen or more years of credited service;
E. age sixty-one years and seventeen or more years of credited service; [or]
F. any age and twenty or more years of credited service for an individual who was a retired member or a member on June 30, 2009; or
G. any age and twenty-five or more years of credited service for an individual who was not a retired member or a member on June 30, 2009."
Section 13. Section 10-11-81 NMSA 1978 (being Laws 1987, Chapter 253, Section 81) is amended to read:
"10-11-81. MUNICIPAL POLICE MEMBER COVERAGE PLAN 5--AGE AND SERVICE REQUIREMENTS FOR NORMAL RETIREMENT.--Under municipal police member coverage plan 5, the age and service requirements for normal retirement are:
A. age sixty-five years or older and five or more years of credited service;
B. age sixty-four years and eight or more years of credited service;
C. age sixty-three years and eleven or more years of credited service;
D. age sixty-two years and fourteen or more years of credited service;
E. age sixty-one years and seventeen or more years of credited service; [or]
F. any age and twenty or more years of credited service for an individual who was a retired member or a member on June 30, 2009; or
G. any age and twenty-five or more years of credited service for an individual who was not a retired member or a member on June 30, 2009."
Section 14. Section 10-11-99 NMSA 1978 (being Laws 1987, Chapter 253, Section 99) is amended to read:
"10-11-99. MUNICIPAL FIRE MEMBER COVERAGE PLAN 3--AGE AND SERVICE REQUIREMENTS FOR NORMAL RETIREMENT.--Under municipal fire member coverage plan 3, the age and service requirements for normal retirement are:
A. age sixty-five years or older and five or more years of credited service;
B. age sixty-four years and eight or more years of credited service;
C. age sixty-three years and eleven or more years of credited service;
D. age sixty-two years and fourteen or more years of credited service;
E. age sixty-one years and seventeen or more years of credited service; [or]
F. any age and twenty or more years of credited service for an individual who was a retired member or a member on June 30, 2009; or
G. any age and twenty-five or more years of credited service for an individual who was not a retired member or a member on June 30, 2009."
Section 15. Section 10-11-105 NMSA 1978 (being Laws 1987, Chapter 253, Section 105) is amended to read:
"10-11-105. MUNICIPAL FIRE MEMBER COVERAGE PLAN 4--AGE AND SERVICE REQUIREMENTS FOR NORMAL RETIREMENT.--Under municipal fire member coverage plan 4, the age and service requirements for normal retirement are:
A. age sixty-five years or older and five or more years of credited service;
B. age sixty-four years and eight or more years of credited service;
C. age sixty-three years and eleven or more years of credited service;
D. age sixty-two years and fourteen or more years of credited service;
E. age sixty-one years and seventeen or more years of credited service; [or]
F. any age and twenty or more years of credited service for an individual who was a retired member or a member on June 30, 2009; or
G. any age and twenty-five or more years of credited service for an individual who was not a retired member or a member on June 30, 2009."
Section 16. Section 10-11-111 NMSA 1978 (being Laws 1987, Chapter 253, Section 111) is amended to read:
"10-11-111. MUNICIPAL FIRE MEMBER COVERAGE PLAN 5--AGE AND SERVICE REQUIREMENTS FOR NORMAL RETIREMENT.--Under municipal fire member coverage plan 5, the age and service requirements for normal retirement are:
A. age sixty-five years or older and five or more years of credited service;
B. age sixty-four years and eight or more years of credited service;
C. age sixty-three years and eleven or more years of credited service;
D. age sixty-two years and fourteen or more years of credited service;
E. age sixty-one years and seventeen or more years of credited service; [or]
F. any age and twenty or more years of credited service for an individual who was a retired member or a member on June 30, 2009; or
G. any age and twenty-five or more years of credited service for an individual who was not a retired member or a member on June 30, 2009."
Section 17. Section 10-11-115.2 NMSA 1978 (being Laws 2003, Chapter 268, Section 3) is amended to read:
"10-11-115.2. MUNICIPAL DETENTION OFFICER MEMBER COVERAGE PLAN 1--AGE AND SERVICE REQUIREMENTS FOR NORMAL RETIREMENT--CALCULATION OF CREDITED SERVICE.--
A. Under municipal detention officer member coverage plan 1, the age and service requirements for normal retirement are:
(1) age sixty-five years or older and five or more years of credited service;
(2) age sixty-four years and eight or more years of credited service;
(3) age sixty-three years and eleven or more years of credited service;
(4) age sixty-two years and fourteen or more years of credited service;
(5) age sixty-one years and seventeen or more years of credited service;
(6) age sixty years and twenty or more years of credited service; or
(7) any age and twenty-five or more years of credited service.
B. In calculating credited service for the purposes of determining retirement eligibility and amount of pension, the credited service of a municipal detention officer member who was a retired member or a member on June 30, 2009 shall have actual credited service increased by twenty percent only for the purposes of municipal detention officer member coverage plan 1, and, if a member transfers or otherwise becomes subject to another coverage plan, only the actual credited service, rather than the increased credited service, may be used to determine retirement eligibility under that other plan."
Section 18. Section 10-11-133 NMSA 1978 (being Laws 1987, Chapter 253, Section 133, as amended) is amended to read:
"10-11-133. INVESTMENT OF FUNDS--PRUDENT INVESTOR STANDARD--CONDITIONS.--
A. Commissions paid for the purchase and sale of any security shall not exceed brokerage rates prescribed and approved by stock exchanges that have been approved by or are under the control of the United States securities and exchange commission or by industry practice.
B. The retirement board shall invest and manage the funds administered by the retirement board in accordance with the Uniform Prudent Investor Act.
C. The retirement board shall provide quarterly performance reports to the legislative finance committee and the department of finance and administration. Annually, the retirement board shall ratify and provide its written investment policy, including any amendments, to the legislative finance committee and the department of finance and administration.
D. Securities purchased with money from or held for any fund administered by the retirement board and for which the retirement board is trustee shall be in the custody of the state treasurer who shall, at the direction of the retirement board, deposit with a bank or trust company the securities for safekeeping or servicing.
E. The retirement board may consult with the state investment council or state investment officer and request information or advice with respect to the retirement board's overall investment plan, may utilize the services of the state investment council and state investment officer and may act on their advice concerning the plan. The state investment council and state investment officer shall render investment services to the retirement board without expense to the retirement board. The retirement board may also employ the investment management services and related management services of a trust company or national bank exercising trust powers or of an investment counseling firm or brokers for the purchase and sale of securities, commission recapture and transitioning services and may pay reasonable compensation for such services from funds administered by the retirement board. The terms of any such investment management services contract shall incorporate the statutory requirements for investment of funds under the retirement board's jurisdiction.
F. The retirement board shall annually provide for its members no less than eight hours of training in pension fund investing, fiduciary obligations or ethics. A member elected to the retirement board who fails to attend the training for two consecutive years shall be deemed to have resigned from the retirement board.
[F.] G. Except as provided in the Public Employees Retirement Act, a member of the retirement board, employee of the retirement board or any person connected with the retirement board in any manner shall not:
(1) have any direct or indirect interest in the gains or profits of any investment made by the retirement board;
(2) receive any direct or indirect pay or emolument for services provided to the retirement board or the association;
(3) directly or indirectly, for the member, employee or person, for themselves or as agent or partner of others, borrow any of the funds or deposits of the association or in any manner use them except to make current and necessary payments authorized by the retirement board; or
(4) become an endorser or surety or become in any manner an obligor for money of the retirement board loaned or borrowed."
Section 19. A new section of the Public Employees Retirement Act is enacted to read:
"[NEW MATERIAL] CALCULATION OF FINAL AVERAGE SALARY.--Under each coverage plan of the Public Employees Retirement Act, the final average salary is one thirty-sixth of the greatest aggregate amount of salary paid a member for three consecutive years of credited service; provided, however, if the salary paid in any year beginning on or after July 1, 2009 exceeds that of the previous year by more than fifteen percent:
A. the amount in excess of fifteen percent shall be excluded in the computation of final average salary; and
B. the salary, as adjusted to exclude any increase of the fifteen percent limitation, shall be used to determine if the salary paid in the subsequent year exceeds the fifteen percent limitation."
Section 20. Section 22-11-13 NMSA 1978 (being Laws 1967, Chapter 16, Section 137, as amended) is amended to read:
"22-11-13. BOARD AUTHORITY TO INVEST THE FUND--PRUDENT INVESTOR STANDARD--INDEMNIFICATION OF BOARD.--
A. The board is authorized to invest or reinvest the fund in accordance with the Uniform Prudent Investor Act.
B. The board shall provide quarterly performance reports to the legislative finance committee and the department of finance and administration. Annually, the board shall ratify and provide its written investment policy, including any amendments, to the legislative finance committee and the department of finance and administration.
C. The board or its designated agent may enter into contracts for the temporary exchange of securities for the use by broker-dealers, banks or other recognized institutional investors, for periods not to exceed one year, for a specified fee or consideration. Such a contract shall not be entered into unless the contract is fully secured by a collateralized, irrevocable letter of credit running to the board, cash or equivalent collateral of at least one hundred two percent of the market value of the securities plus accrued interest temporarily exchanged. This collateral shall be delivered to the state fiscal agent or its designee contemporaneously with the transfer of funds or delivery of the securities. Such contract may authorize the board to invest cash collateral in instruments or securities that are authorized fund investments and may authorize payment of a fee from the fund or from income generated by the investment of cash collateral to the borrower of securities providing cash as collateral. The board may apportion income derived from the investment of cash collateral to pay its agent in securities lending transactions.
D. Commissions paid for the purchase or sale of any securities pursuant to the provisions of the Educational Retirement Act shall not exceed brokerage rates prescribed and approved by national stock exchanges or by industry practice.
E. Securities purchased for the fund shall be held in the custody of the state treasurer. At the direction of the board, the state treasurer shall deposit with a bank or trust company the securities for safekeeping or servicing.
F. The board may consult with the state investment council or the state investment officer; may request from the state investment council or the state investment officer any information, advice or recommendations with respect to investment of the fund; may utilize the services of the state investment council or the state investment officer; and may act upon any advice or recommendations of the state investment council or the state investment officer. The state investment council or the state investment officer shall render investment advisory services to the board upon request and without expense to the board. The board may also employ the investment management services and related management services of a trust company or national bank exercising trust powers or of an investment counseling firm or brokers for the purchase and sale of securities, commission recapture and transitioning services and may pay reasonable compensation for those services from funds administered by the board.
G. The board shall annually provide for its members no less than eight hours of training in pension fund investing, fiduciary obligations or ethics. A member elected or appointed to the board who fails to attend the training for two consecutive years shall be deemed to have resigned from the board.
[G.] H. Members of the board, jointly and individually, shall be indemnified from the fund by the state from all claims, demands, suits, actions, damages, judgments, costs, charges and expenses, including court costs and attorney fees, and against all liability, losses and damages of any nature whatsoever that members shall or may at any time sustain by reason of any decision made in the performance of their duties pursuant to this section."
Section 21. Section 22-11-23 NMSA 1978 (being Laws 1981, Chapter 293, Section 2, as amended) is amended to read:
"22-11-23. RETIREMENT ELIGIBILITY--INITIAL MEMBERSHIP PRIOR TO JULY 1, 2009.--
A. [On and after July 1, 1984] The retirement eligibility for a member who either was a member on June 30, 2009, or was a member at any time prior to that date and had not, on that date, been refunded all member contributions pursuant to Subsection A of Section 22-11-15 NMSA 1978, is as follows:
(1) a member shall be eligible for retirement benefits pursuant to the Educational Retirement Act when either of the following conditions occurs:
(a) the sum of the member's age and years of earned service-credit equals seventy-five; or
(b) upon completion of five years of earned service-credit and upon becoming sixty-five years of age;
(2) a member under sixty years of age eligible to retire under Paragraph (1) of this subsection may retire and receive retirement benefits pursuant to the Educational Retirement Act that [he] the member would be eligible to receive if [he] the member were to retire at the age of sixty years reduced by six-tenths of one percent for each one-fourth, or portion thereof, year that retirement occurs prior to the member's sixtieth [birthdate] birthday but after the fifty-fifth [birthdate] birthday, and one and eight-tenths percent for each one-fourth, or portion thereof, year that retirement occurs prior to age fifty-five; or
(3) a member under sixty years of age acquiring twenty-five or more years of earned and allowed service credit may retire and receive retirement benefits pursuant to the Educational Retirement Act computed on the same basis as if the member were sixty years of age.
B. A member shall be subject to the provisions of Paragraphs (2) and (3) of Subsection A of this section as they existed at the beginning of [his] the member's last cumulated four quarters of earned service-credit, regardless of later amendment."
Section 22. A new section of the Educational Retirement Act, Section 22-11-23.1 NMSA 1978, is enacted to read:
"22-11-23.1. [NEW MATERIAL] RETIREMENT ELIGIBILITY--INITIAL MEMBERSHIP ON OR AFTER JULY 1, 2009.--A member who initially became a member on or after July 1, 2009 or a member who was a member at any time prior to that date and had, before that date, been refunded all member contributions pursuant to Subsection A of Section 22-11-15 NMSA 1978, shall be eligible for retirement benefits pursuant to the Educational Retirement Act when one of the following conditions occurs:
A. the member is at least fifty-five years of age and has thirty or more years of earned service credit;
B. the member is at least sixty-seven years of age and has five or more years of earned service credit; or
C. the sum of the member's age and years of earned service credit equals at least eighty."
Section 23. Section 22-11-25.1 NMSA 1978 (being Laws 2001, Chapter 283, Section 2, as amended by Laws 2003, Chapter 80, Section 1 and by Laws 2003, Chapter 145, Section 1) is amended to read:
"22-11-25.1. RETURN TO EMPLOYMENT--BENEFITS CONTINUED--ADMINISTRATIVE UNIT CONTRIBUTIONS.--
A. Except as provided in Subsections B and E of this section, beginning January 1, 2002 and continuing until January 1, 2012, a retired member may begin employment at a local administrative unit and shall not be required to suspend retirement benefits if the member has not been employed as an employee or independent contractor by a local administrative unit for at least twelve consecutive months from the date of retirement to the commencement of employment or reemployment with a local administrative unit. If the retired member returns to employment without first completing twelve consecutive months of retirement, the retired member shall remove himself or herself from retirement.
B. A retired member who was retired on or before January 1, 2001, has not since suspended or been required to suspend retirement benefits pursuant to the Educational Retirement Act and is reemployed by a local administrative unit may continue employment at the local administrative unit and shall not be required to suspend retirement benefits.
C. A retired member who returns to employment during retirement pursuant to Subsection A or B of this section is entitled to continue to receive retirement benefits but is not entitled to acquire service credit or to acquire or purchase service credit in the future for the period of the retired member's reemployment with a local administrative unit.
D. A retired member who returns to employment pursuant to [Subsections] Subsection A or B of this section shall not make contributions to the fund as specified in the Educational Retirement Act; however, the local administrative unit's contributions as specified in that act shall be paid to the fund as if the retired member was a non-retired employee.
E. Beginning July 1, 2003 and continuing until January 1, 2012, a retired member who retired on or before January 1, 2001 and who has not been employed as an employee or independent contractor by a local administrative unit for at least ninety days may begin employment at a local administrative unit without suspending retirement benefits if the retired member was not employed by a local administrative unit for an additional twelve or more consecutive months after the initial date of the retirement; provided that the ninety- day period shall not include any part of a summer or other scheduled break or vacation period.
F. Both the retired member who returns to employment and the local administrative unit that employs the retired member shall make contributions to the retiree health care fund in the amount specified in Subsections A and B of Section 10-7C-15 NMSA 1978."
Section 24. Section 22-11-30 NMSA 1978 (being Laws 1967, Chapter 16, Section 153, as amended) is amended to read:
"22-11-30. RETIREMENT BENEFITS.--
A. Retirement benefits for a member retired pursuant to the Educational Retirement Act on or before June 30, 1967 shall be paid monthly and shall be one-twelfth of a sum equal to one and one-half percent of the first four thousand dollars ($4,000) of the member's average annual salary and one percent of the remainder of the member's average annual salary multiplied by the number of years of the member's total service credit.
B. Retirement benefits for a member retired pursuant to the Educational Retirement Act on or after July 1, 1967 but on or before June 30, 1971 shall be paid monthly and shall be one-twelfth of a sum equal to one and one-half percent of the first six thousand six hundred dollars ($6,600) of the member's average annual salary and one percent of the remainder of the member's average annual salary multiplied by the number of years of the member's total service credit.
C. Retirement benefits for a member retired pursuant to the Educational Retirement Act on or after July 1, 1971 but on or before June 30, 1974 shall be paid monthly and shall be one-twelfth of a sum equal to one and one-half percent of the member's average annual salary multiplied by the number of years of the member's total service credit.
D. Retirement benefits for a member retired pursuant to the Educational Retirement Act on or before June 30, 1974 but returning to employment on or after July 1, 1974 for a cumulation of one or more years shall be computed pursuant to Subsection E of this section. Retirement benefits for a member retired pursuant to the Educational Retirement Act on or before June 30, 1974 but returning to employment on or after July 1, 1974 for a cumulation of less than one year shall be computed pursuant to Subsection A of this section if [his] the member's date of last retirement was on or before June 30, 1967 or pursuant to Subsection B of this section if [his] the member's date of last retirement was on or after July 1, 1967 but not later than June 30, 1971 or pursuant to Subsection C of this section if [his] the member's date of last retirement was on or after July 1, 1971 but not later than June 30, 1974.
E. Retirement benefits for a member age sixty or over, retired pursuant to the Educational Retirement Act on or after July 1, 1974 but not later than June 30, 1987, shall be paid monthly and shall be one-twelfth of a sum equal to:
(1) one and one-half percent of the member's average annual salary multiplied by the number of years of service credit for:
(a) prior employment; and
(b) allowed service credit for service performed prior to July 1, 1957, except United States military service credit purchased pursuant to Paragraph (3) of Subsection A of Section 22-11-34 NMSA 1978; plus
(2) two percent of the member's average annual salary multiplied by the number of years of service credit for:
(a) contributory employment;
(b) allowed service credit for service performed after July 1, 1957; and
(c) United States military service credit for service performed prior to July 1, 1957 and purchased pursuant to Paragraph (3) of Subsection A of Section 22-11-34 NMSA 1978.
F. Retirement benefits for a member age sixty or over, retired pursuant to the Educational Retirement Act on or after July 1, 1987 but not later than June 30, 1991, shall be paid monthly and shall be one-twelfth of a sum equal to two and fifteen hundredths percent of the member's average annual salary multiplied by the number of years of the member's total service credit; provided that this subsection shall not apply to any member who was retired in any of the four quarters ending on June 30, 1987 without having accumulated not less than 1.0 years earned service credit after June 30, 1987.
G. Retirement benefits for a member age sixty or over, retired pursuant to [the Educational Retirement Act] Section 22-11-23 NMSA 1978 on or after July 1, 1991, shall be paid monthly and shall be one-twelfth of a sum equal to two and thirty-five hundredths percent of the member's average annual salary multiplied by the number of years of the member's total service credit; provided that this subsection shall not apply to any member who was retired in any of the four consecutive quarters ending on June 30, 1991 without having accumulated at least one year earned service credit beginning on or after July 1, 1991.
H. Retirement benefits for a member, retired pursuant to Section 22-11-23.1 NMSA 1978, shall be paid monthly and shall be one-twelfth of a sum equal to two and thirty-five hundredths percent of the member's average annual salary multiplied by the number of years of the member's total service credit; provided that the benefit for a member retiring pursuant to Subsection C of Section 22-11-23.1 NMSA 1978 shall be reduced by:
(1) six-tenths of one percent for each one-fourth, or portion thereof, year that retirement occurs prior to the member's sixty-fifth birthday but after the sixtieth birthday; and
(2) one and eight-tenths percent for each one-fourth, or portion thereof, year that retirement occurs prior to the member's sixtieth birthday.
[H.] I. A member's average annual salary, pursuant to this section, shall be computed on the basis of the last five years for which contribution was made or upon the basis of any consecutive five years for which contribution was made by the member, whichever is higher; provided, however:
(1) if the salary paid in any year beginning on or after July 1, 2009 exceeds that of the previous year by more than fifteen percent:
(a) the amount in excess of fifteen percent shall be excluded in the computation of average annual salary; and
(b) the salary, as adjusted to exclude any increase of the fifteen percent limitation, shall be used to determine if the salary paid in the subsequent year exceeds the fifteen percent limitation; and
(2) lump-sum payments made after July 1, 2009 of accrued sick leave or annual leave shall be excluded from the calculation of salary.
J. Unless otherwise required by the provisions of the Internal Revenue Code of 1986, members shall begin receiving retirement benefits by age seventy and six months, or upon termination of employment, whichever occurs later."
Section 25. 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 [he] 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 [his] the member's employment in New Mexico if [he] the member returned to [his] 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 [he] the member was honorably discharged if [he] the member contributes to the fund a sum equal to ten and one-half percent of [his] the member's average annual salary for that period of time for which [he] the member has acquired earned service credit pursuant to the Educational Retirement Act and subject to the federal Uniformed Services Employment and Reemployment Rights Act of 1994 for each year of service credit [he] the member desires to purchase. Average annual salary shall be determined in accordance with rules promulgated by the board but shall always be based on actual salaries earned by the member where the actual salaries can be ascertained by the board. The employer's contributions for service credit shall not be paid by the employer. The purchase of service credit provided in this section shall be carried out by the member within three years after the date of the member's employment following service; 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 [state board] 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. Payment pursuant to Paragraph (4) of Subsection A of this section may be made in installments, at the discretion of the board, over a period not to exceed one year and, if the sum paid does not equal the amount required for any full year of allowed service credit, the member shall acquire allowed service credit for that period of time that is proportionate to the payment made. Half credit may be allowed without contribution for not more than ten years of the educational service described by Subparagraph (a) of Paragraph (4) of Subsection A of this section if that service was prior to June 13, 1953 and if the member was employed in New Mexico prior to June 13, 1953 in a position covered by the Educational Retirement Act or a law repealed by that act. 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; or
(3) unless the member makes a contribution to the retiree health care fund pursuant to Subsection C of Section 10-7C-15 NMSA 1978.
D. The provisions of this section are made applicable to the services described prior to as well as after the effective date of the Educational Retirement Act."
Section 26. REPEAL.--
A. Sections 10-11-26.4, 10-11-30, 10-11-38.4, 10-11-47, 10-11-53, 10-11-55.4, 10-11-55.10, 10-11-59, 10-11-65, 10-11-71, 10-11-77, 10-11-83, 10-11-89, 10-11-95, 10-11-101, 10-11-107, 10-11-113 and 10-11-115.4 NMSA 1978 (being Laws 1994, Chapter 128, Section 5, Laws 1987, Chapter 253, Section 30, Laws 1994, Chapter 128, Section 12, Laws 1987, Chapter 253, Sections 47 and 53, Laws 1993, Chapter 58, Section 4, Laws 1998, Chapter 106, Section 4, Laws 1987, Chapter 253, Sections 59, 65, 71, 77, 83, 89, 95, 101, 107 and 113 and Laws 2003, Chapter 268, Section 5, as amended) are repealed.
B. Laws 2004, Chapter 2, Section 1 is repealed.
Section 27. EFFECTIVE DATE.--The effective date of the provisions of this act is July 1, 2009.
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