HB302: (New Title) relative to the funding and use of the retirement system special account.

CHAPTER 221

HB 302-FN - FINAL VERSION

25mar03... 0736h

05/22/03 1642s

2003 SESSION

03-0659

10/01

HOUSE BILL 302-FN

AN ACT relative to the funding and use of the retirement system special account.

SPONSORS: Rep. Welch, Rock 79; Rep. D'Allesandro, Dist 20

COMMITTEE: Executive Departments and Administration

AMENDED ANALYSIS

This bill provides for the subdivision of the retirement system special account components into a state employee portion and a political subdivision employee portion.

This bill also adds requirements for the approval and use of retirement system funds in the special account for supplemental benefits.

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Explanation: Matter added to current law appears in bold italics.

Matter removed from current law appears [in brackets and struckthrough.]

Matter which is either (a) all new or (b) repealed and reenacted appears in regular type.

25mar03... 0736h

05/22/03 1642s

03-0659

10/01

STATE OF NEW HAMPSHIRE

In the Year of Our Lord Two Thousand Three

AN ACT relative to the funding and use of the retirement system special account.

Be it Enacted by the Senate and House of Representatives in General Court convened:

221:1 Retirement System; Special Account. Amend RSA 100-A:16, II(h) to read as follows:

(h) There shall be a special account for additional benefits held by the board of trustees. Beginning July 1, 2003, the special account shall be subdivided into [4] components representing the 4 retirement system member classifications, as defined in RSA 100-A:1, with each component subdivided proportionally between employees of the state and employees of the political subdivisions of the state. The balance of the special account attributed to each component as of June 30, 2003 shall be subdivided between state and political subdivision classifications based upon the actuarial liabilities of the member and retiree groups. Beginning with the fiscal year ending June 30, 1990, the amount credited annually to the special account shall be determined as follows:

(1) Each component of the special account shall first be credited with all the earnings of that component for the fiscal year.

(2) All of the earnings of the remaining assets of the retirement system which are in excess of the assumed rate of return plus 1/2 of one percent added to such rate shall be allocated to the 4 member classifications. The assumed rate of return shall be determined by the board of trustees.

(3) Any funds held in special reserve as of June 30, 1996, shall be transferred to the respective component of the special account according to the following schedule:

(i) One-half of the funds held in special reserve as of June 30, 1996.

(ii) One-half of the remaining funds as of June 30, 1997, plus earnings from July 1, 1996 to June 30, 1997.

(iii) All remaining funds as of June 30, 1998, plus earnings from July 1, 1997, to June 30, 1998.

(4) [Repealed.]

(5) None of the assets held in the special account shall be used in the actuarial determination of the rate percent of normal contribution as set forth in subparagraphs (b), (c) and (d).

(6) [Repealed.]

(7) The actuarial cost of all legislation enacted during each fiscal year and calling for funding from the special account shall be withdrawn from the respective components of the special account, as of June 30 of each year, after funds are credited to the special account as provided in this subparagraph.

The special account shall be used only to fund or partially fund additional benefits as follows: first, to provide supplemental allowances, or COLAs, pursuant to RSA 100-A:41-a and, second, to the extent that funds may be available in the special account in excess of a 3-year 5 percent COLA reserve, to provide additional benefits to retired members and beneficiaries of the retirement system with the specific approval of the appropriate policy committees and approval of the general court. Nothing in this section shall preclude the appropriate legislative policy committees and the general court from adopting legislation that provides additional benefits in the event that the special account does not contain a 3-year, 5 percent COLA reserve.

221:2 Effective Date. This act shall take effect July 1, 2003.

(Approved: Enacted in accordance with Article 44, Part II, N.H. Constitution, without signature of the Governor, July 1, 2003)

(Effective Date: July 1, 2003)