HP0425, LD 542, item 1, An Act To Ensure Retirement Benefits for Members of the Maine Public Employees Retirement System

An Act To Ensure Retirement Benefits for Members of the Maine Public Employees Retirement System

Be it enacted by the People of the State of Maine as follows:

Sec. 1. 3 MRSA §755, sub-§1, as amended by PL 2007, c. 491, §17, is further amended to read:

1. Findings. The Legislature finds that the State owes a great debt to its retired Legislators for their years of faithful and productive service. Part of that debt is repaid by the benefits provided to Legislators through the Legislative Retirement Program. The Legislature further finds that continued accrual of benefits under the defined benefit plan of the Legislative Retirement Program on or after December 5, 2012 is an unnecessary expense and is inconsistent with legislative term limits and the concept of a citizen Legislature. Accrual of benefits under the Legislative Retirement Program after December 5, 2012 is appropriate only for Legislators who are already qualified in the Legislative Retirement Program under section 851 or the Maine Public Employees Retirement System on that date.

Sec. 2. 3 MRSA §801, sub-§1, as amended by PL 2007, c. 491, §18, is further amended to read:

1. Membership. Every Until December 5, 2012, every Legislator serving in the Legislature on or after December 3, 1986 is a member of the Legislative Retirement Program, except that any Legislator who was a member of the former Maine State Retirement System on December 2, 1986 may choose to be a member of the State Employee and Teacher Retirement Program instead of becoming a member of the Legislative Retirement Program, and any Legislator who is a public school teacher or an employee of the Maine Community College System on leave of absence for the purpose of serving in the Legislature continues to be a member of the State Employee and Teacher Retirement Program and to have contributions deducted from the member's legislative earnable compensation as provided by Title 5, section 17701. A Legislator who terminates employment from a position requiring membership in the State Employee and Teacher Retirement Program no longer contributes to the State Employee and Teacher Retirement Program and, if qualified, is eligible to become a benefit recipient under Title 5, section 17804. Upon such termination, the Legislator becomes a member of the Legislative Retirement Program. Except as provided in section 802, subsection 4, paragraph A, creditable service granted under the State Employee and Teacher Retirement Program may not be transferred to the Legislative Retirement Program. A member ceases to be a member when the member withdraws the member's contributions, becomes a beneficiary as a result of the member's own retirement or dies. On or after July 1, 2012, unless they have made a previous election, Legislators enrolled in the Legislative Retirement Program or the State Employee and Teacher Retirement Program may make a one-time election whether to remain a member. Once an election is made under this subsection, the election is irrevocable with respect to all subsequent employment with the same employer. A Legislator who is not vested under section 705, subsection 1 or first-time Legislators serving on or after December 5, 2012 may not be members of the Legislative Retirement Program.

Sec. 3. 3 MRSA §801, sub-§1-A, as amended by PL 2009, c. 474, §4, is further amended to read:

1-A. Waiver provision. Any Until December 5, 2012, any Legislator may petition the presiding officer for a waiver from the membership provisions of subsection 1 if it can be demonstrated that membership in the Legislative Retirement Program will create or exacerbate a Legislator's federal income tax liability due to the ownership of another retirement plan. The Office of the Executive Director of the Legislative Council shall provide assistance as requested by the Legislator or presiding officer. The presiding officer shall respond to the Legislator's petition within 30 days and shall provide copies of the decision to the Executive Director of the Legislative Council and the Executive Director of the Maine Public Employees Retirement System. A granted waiver of membership constitutes a one-time irrevocable election with respect to all subsequent employment with the same employer when membership in the Legislative Retirement Program is not mandatory.

Sec. 4. 3 MRSA §802, sub-§3, as enacted by PL 1985, c. 507, §1, is amended to read:

3. Disability retirement. The period following the termination of service before December 5, 2012 for which a beneficiary receives disability retirement allowance payments under section 853 shall be is allowed as membership service. The period following the termination of service on or after December 5, 2012 for which a beneficiary receives disability retirement allowance payments under section 853 is allowed as membership service only if the beneficiary is a member of the Legislative Retirement Program, as provided in section 801, subsection 1.

Sec. 5. 3 MRSA §805-A, as amended by PL 2007, c. 491, §22, is further amended to read:

§ 805-A. Refund of accumulated contributions

1. Conditions for refund. If Except as provided in section 805-B, if the service of any member has terminated, except by death or by retirement under this chapter, the member must be paid the amount of the member's accumulated contributions under the following conditions:

A. The member must have properly applied for a refund of accumulated contributions;

B. Payment On or after December 5, 2012 concerning a Legislator's membership under section 801, subsection 1, for Legislators or former Legislators seeking a refund of accumulated contributions, payment must be made after termination of service and not less than 22 days nor more than 60 days after receipt of the application and receipt of the last payroll upon from which the name of the member appears contributions to the Legislative Retirement Program were taken, whichever occurs later;

C. An application for refund is void if the member filing the application returns to membership in any retirement plan administered by the Maine Public Employees Retirement System before issuance of the payment; and

D. Only accumulated contributions made by the member or picked up by the employer may be refunded to that member under this subsection.

Sec. 6. 4 MRSA §1301, as amended by PL 2009, c. 415, Pt. A, §2, is further amended to read:

§ 1301. Membership

Every judge serving on the court on or after December 1, 1984 must be before July 1, 2012 is a member of the Judicial Retirement Program as a condition of employment , but on or after July 1, 2012, unless the member has made a previous election, may make a one-time election whether to remain a member of the Judicial Retirement Program. On or after July 1, 2012, membership in the Judicial Retirement Program for newly appointed judges is optional. A person must make an election at the time of appointment whether to be a member of the program. Once an election is made under this section, the election is irrevocable with respect to all subsequent employment with the same employer.

A member shall cease ceases to be a member when he that member withdraws his contributions, becomes a beneficiary as a result of his own retirement , elects to withdraw from the Judicial Retirement Program or dies.

The State Court Administrator shall submit to the board a statement showing the name, title, compensation, sex, date of birth and length of service of each member and any other information as the board may require at such times as the board may require.

Sec. 7. 5 MRSA §17651, as amended by PL 2007, c. 491, §94, is repealed and the following enacted in its place:

§ 17651. Membership

All employees hired before July 1, 2012 become members of the State Employee and Teacher Retirement Program as a condition of their employment, but on or after July 1, 2012, unless they have made a previous election, employees may make a one-time election whether to remain a member of the program. Once an election is made under this subsection, the election is irrevocable with respect to all subsequent employment with the same employer.

Sec. 8. 5 MRSA §17652, sub-§1-A is enacted to read:

1-A. Optional membership. On or after July 1, 2012, membership in the State Employee and Teacher Retirement Program is optional. Notwithstanding section 17659, a person must make an election at the time of hire whether to be a member of the program. Once an election is made under this subsection, the election is irrevocable with respect to all subsequent employment with the same employer when membership in the program is not mandatory.

Sec. 9. 5 MRSA §17654, sub-§2, as enacted by PL 1985, c. 801, §§5 and 7, is amended to read:

2. Beneficiary. Becomes a beneficiary as a result of the member's own retirement; or

Sec. 10. 5 MRSA §17654, sub-§3, as enacted by PL 1985, c. 801, §§5 and 7, is amended to read:

3. Death. Dies . ; or

Sec. 11. 5 MRSA §17654, sub-§4 is enacted to read:

4. Opts out. Elects to withdraw from the program as provided in section 17651 or section 17652, subsection 1-A.

Sec. 12. 5 MRSA §17659 is enacted to read:

§ 17659. Election to withdraw from the State Employee and Teacher Retirement Program

1. Exercise option. The retirement system shall provide an opportunity for each member who has not already made a prior election and is a member on July 1, 2012 to elect in writing to terminate membership. An election made by a member under this subsection is irrevocable. The retirement system shall accept written elections under this subsection from members during the period beginning on January 1, 2012 and ending on March 31, 2012. A member who does not make a written election or who does not file the election during the period specified in this subsection continues to be a member of the State Employee and Teacher Retirement Program.

2. Former members. If an individual who is a former member on July 1, 2012 is later reemployed and by virtue of that reemployment is again eligible for membership, the former member shall elect in writing to remain a member or to terminate membership. An election made by a former member under this subsection is irrevocable. The retirement system shall accept written elections under this subsection from a former member during the period beginning on the date of the commencement of reemployment and ending 90 days after that date. A former member who makes and files a written election to remain a member retains all rights and is subject to all conditions as a member of the State Employee and Teacher Retirement Program. A former member who does not make a written election or who does not file the election during the period specified in this subsection continues to be a member of the program.

3. Method of election. The board shall determine the method by which a member or former member makes a written election under this section.

Sec. 13. Effective date; implementation. This Act takes effect July 1, 2012, except that the Maine Public Employees Retirement System shall review the provisions of this Act and report in writing to the joint standing committee of the Legislature having jurisdiction over retirement matters no later than December 15, 2011. The report must identify any technical, legal, fiscal or policy issues associated with implementation of this Act. Following review of the report, the committee may report out legislation to address those issues.

SUMMARY

This bill establishes an option for new employees hired on or after July 1, 2012 to become members of the Judicial Retirement Program or the State Employee and Teacher Retirement Program. Current members may make a one-time, irrevocable election to remain as members.

Legislators who are not vested as members in the Legislative Retirement Program and first-time Legislators serving on or after December 5, 2012 may not be members of the Legislative Retirement Program. Vested Legislators serving on or after December 5, 2010 may make a one-time, irrevocable election to remain as members.

Those who do not elect to become members of the Maine Public Employees Retirement System are enrolled in the federal social security program.

HP0425 LD 542	First Regular Session - 125th Maine Legislature		LR 48 Item 1
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