00 HOUSE BILL NO. 242 01 "An Act relating to reemployment of and medical benefits for retired members of the 02 teachers' retirement system and public employees' retirement system; relating to the 03 inclusion of cost-of-living differentials on compensation and benefits under the public 04 employees' retirement system; and providing for an effective date." 05 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF ALASKA: 06  * Section 1. AS 14.25.040(a) is amended to read: 07 (a) Unless a teacher or member has elected to participate in the optional 08 university retirement program under AS 14.40.661 - 14.40.799 or has filed an  09 election under AS 14.25.043(b), a teacher or member contracting for service with a 10 participating employer is subject to this chapter. 11  * Sec. 2. AS 14.25.043 is amended to read: 12 Sec. 14.25.043. Reemployment of retired members. (a) If a retired member 13 again becomes an active member, benefit payments may not be made during the 14 period of reemployment unless the teacher makes an election under (b) of this  01 section. The retirement benefit must be suspended for the entire school year if the 02 teacher is reemployed as an active teacher for a period equivalent to a year of service. 03 During the period of reemployment, deductions from the member's salary will be 04 made in accordance with AS 14.25.050. Upon subsequent retirement, the retired 05 member is entitled to receive an additional benefit based on the credited service and 06 the average base salary during the period of reemployment in accordance with 07 AS 14.25.110. 08 (b) A member who retired under AS 14.25.110(a) and subsequently  09 becomes an active member may, within 30 days of the date of reemployment,  10 elect to continue receiving benefit payments during the period of reemployment  11 by filing a waiver of coverage with the administrator on a form provided by the  12 administrator. An election under this subsection waives coverage for the period  13 of reemployment and is irrevocable during the period of reemployment.  14 Deductions from the member's salary may not be made under AS 14.25.050  15 during the period of reemployment, and the member may not receive credited  16 service for the period of reemployment. A member who participated in a  17 retirement incentive program under ch. 26, SLA 1986; ch. 89, SLA 1989; ch. 65,  18 SLA 1996; ch. 4, FSSLA 1996; or ch. 92, FSSLA 1997, is not eligible to make an  19 election under this subsection.  20 (c) A member who has not made an election under (b) of this section is  21 subject to AS 14.25.050.  22 (d) If the initial benefit payments to which the retired member is eligible have 23 been actuarially reduced because the member retired early under AS 14.25.110(b), the 24 member shall also receive an incremental benefit based on the amount of the actuarial 25 reduction imposed by AS 14.25.110(j) on the first benefit and the length of time that 26 the employee was reemployed and not receiving retirement benefits. The amount of 27 the incremental benefit is equal to the difference between the normal retirement 28 benefit to which the member would have been entitled had the member taken a normal 29 retirement and the early retirement benefit that the member has been receiving based 30 on the member's initial period of employment multiplied by the total number of 31 months that the member did not receive retirement benefits because of reemployment 01 and that amount actuarially adjusted to be paid over the expected lifetime of the 02 member. 03  * Sec. 3. AS 14.25.168(d) is amended to read: 04 (d) A benefit recipient may elect major medical insurance coverage in 05 accordance with regulations and under the following conditions: 06 (1) a person who has less than 25 years of membership service and  07 who is younger than 60 years of age must pay an amount equal to the full monthly 08 group premium for retiree major medical insurance coverage; 09 (2) [A PERSON WHO IS AT LEAST 60 YEARS OF AGE BUT IS 10 YOUNGER THAN 65 YEARS OF AGE MUST PAY AN AMOUNT EQUAL TO 11 ONE-HALF OF THE FULL MONTHLY GROUP PREMIUM FOR RETIREE 12 MAJOR MEDICAL INSURANCE COVERAGE; 13 (3)] a disabled member, a disabled member who is appointed to  14 normal retirement, [OR] a person 60 [65] years of age or older, or a person who has  15 at least 25 years of membership service is not required to make premium payments. 16  * Sec. 4. AS 39.35.120(b) is amended to read: 17 (b) Inclusion in the system is a condition of employment for an employee 18 except as otherwise provided for an 19 (1) elected official;  20 (2) employee making an election under AS 39.35.150(b); and 21 (3) [FOR AN] employee of the university who has elected to 22 participate in the optional university retirement program under AS 14.40.661 - 23 14.40.799. 24  * Sec. 5. AS 39.35.150 is amended to read: 25 Sec. 39.35.150. Re-employment of retired employees. (a) If a retired 26 employee subsequently becomes an active member, benefit payments may not be 27 made during the period of re-employment unless the member makes an election  28 under (b) of this section. During the period of re-employment, deductions from the 29 employee's salary shall be made in accordance with AS 39.35.160. Upon subsequent 30 retirement, the retired employee is entitled to receive an additional pension based on 31 the credited service and the average monthly compensation earned during the period 01 of re-employment in accordance with AS 39.35.370. 02 (b) A member who retired under AS 39.35.370(a) and subsequently  03 becomes an active member may, within 30 days of the date of reemployment,  04 elect to continue receiving benefit payments during the period of reemployment  05 by filing an election with the administrator on a form provided by the  06 administrator. An election under this subsection waives coverage for the period  07 of reemployment and is irrevocable during the period of reemployment. During  08 the period of reemployment, deductions from the member's salary may not be  09 made under AS 39.35.160 and the member may not receive credited service. A  10 member who participated in a retirement incentive program under ch. 26, SLA  11 1986; ch. 89, SLA 1989; ch. 65, SLA 1996; ch. 4, FSSLA 1996; or ch. 92, SLA  12 1997, is not eligible to make an election under this subsection.  13 (c) A member who has not made an election under (b) of this section is  14 subject to AS 39.35.120 and 39.35.160.  15 (d) If the initial benefit payments to which the retired member is eligible have 16 been reduced because the member retired early under AS 39.35.370(b) or increased 17 because the member elected to receive a level income option benefit under former 18 AS 39.35.460, the member shall also receive an incremental benefit based on the 19 amount of the reduction imposed by AS 39.35.370(b) or the increase under former 20 AS 39.35.460 on the first benefit and the length of time that the employee was 21 reemployed and not receiving retirement benefits. The amount of the incremental 22 benefit is equal to the difference between the normal retirement benefit to which the 23 member would have been entitled had the member taken a normal retirement and the 24 early retirement benefit or benefit under the level income option that the member has 25 been receiving based on the member's initial period of employment multiplied by the 26 total number of months that the member did not receive retirement benefits because of 27 reemployment and that amount actuarially adjusted to be paid over the expected 28 lifetime of the member. In the case of a member who selected benefits under the level 29 income option, the total number of months may not include any month in which the 30 member was 65 years of age or older. 31  * Sec. 6. AS 39.35.535(c) is repealed and reenacted to read: 01 (c) A benefit recipient may elect major medical insurance coverage in 02 accordance with regulations and under the following conditions: 03 (1) a person, other than a disabled member or a disabled member who 04 is appointed to normal retirement, must pay an amount equal to the full monthly group 05 premium for retiree major medical insurance coverage if the person is 06 (A) younger than 60 years of age and has less than 07 (i) 25 years of credited service as a peace officer under 08 AS 39.35.360 and 39.35.370; or 09 (ii) 30 years of credited service under AS 39.35.360 and 10 39.35.370 that is not service as a peace officer; or 11 (B) of any age and has less than 10 years of credited service; 12 (2) a person is not required to make premium payments for retiree 13 major medical coverage if the person 14 (A) is a disabled member; 15 (B) is 60 years of age or older and has at least 10 years of 16 credited service; or 17 (C) has at least 18 (i) 25 years of credited service as a peace officer under 19 AS 39.35.360 and 39.35.370; or 20 (ii) 30 years of credited service under AS 39.35.360 and 21 39.35.370 not as a peace officer. 22  * Sec. 7. AS 39.35.675(b) is amended to read: 23 (b) The amount of a cost-of-living differential may not be included in the 24 employee's compensation for purposes of calculating benefits paid under this chapter 25 unless the employee has received a cost-of-living differential [IN A COMPARABLE 26 AMOUNT OR OF AT LEAST THAT MANY STEPS] for at least 50 percent of the 27 employee's credited service. 28  * Sec. 8. The uncodified law of the State of Alaska is amended by adding a new section to 29 read: 30 TRANSITION: REGULATIONS. (a) Notwithstanding sec. 10 of this Act, the 31 Alaska Teachers' Retirement Board may immediately proceed to adopt regulations necessary 01 to implement changes made by secs. 1 - 3 of this Act. The regulations take effect under 02 AS 14.25.022, but not before July 1, 2001. 03 (b) Notwithstanding sec. 10 of this Act, the Public Employees' Retirement Board may 04 immediately proceed to adopt regulations necessary to implement changes made by secs. 4 - 7 05 of this Act. The regulations take effect under AS 39.35.042, but not before July 1, 2001. 06  * Sec. 9. Section 8 of this Act takes effect immediately under AS 01.10.070(c). 07  * Sec. 10. Except as provided in sec. 9 of this Act, this Act takes effect July 1, 2001.