00 HOUSE BILL NO. 152 01 "An Act requiring certain employers who terminate participation in the defined benefit 02 retirement plan or the defined contribution retirement plan of the Public Employees' 03 Retirement System to make contributions related to past service liability and pay 04 termination costs; repealing a requirement that employers who terminate participation 05 in the defined contribution retirement plan or the defined benefit retirement plan of the 06 Public Employees' Retirement System pay for a termination cost study; and providing 07 for an effective date." 08 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF ALASKA: 09 * Section 1. AS 39.35.255 is amended by adding a new subsection to read: 10 (i) After an employer's participation in the plan terminates with regard to some 11 or all of the employer's employees who are active members of the system, the 12 employer remains obligated to make contributions under (a) of this section until the 13 plan does not have a past service liability. 01 * Sec. 2. AS 39.35.625 is repealed and reenacted to read: 02 Sec. 39.35.625. Termination costs. (a) An employer that terminates 03 participation under AS 39.35.615 or 39.35.620 shall pay a termination cost for a 04 payroll period in which the employer's salary base, if annualized, is 05 (1) $5,000,000 or more, and is less than 80 percent of the employer's 06 salary base for the fiscal year ending one year before the beginning of the fiscal year 07 in which the payroll period occurs; or 08 (2) $1,000,000 or more, but less than $5,000,000, and is less than 50 09 percent of the employer's salary base for the fiscal year ending one year before the 10 beginning of the fiscal year in which the payroll period occurs. 11 (b) The requirements in (a) of this section do not apply to a payroll period in 12 which the employer's annualized salary base is less than $1,000,000. 13 (c) Notwithstanding AS 39.35.255, an employer is subject to the termination 14 cost requirements in (a) of this section until the past service liability of the plan is 15 extinguished. The amount of a termination cost payment shall be calculated by 16 multiplying the current past service contribution rate adopted by the board by the 17 amount, in dollars, by which 18 (1) the employer's annualized salary base is less than 80 percent of its 19 salary base for the fiscal year ending one year before the beginning of the fiscal year 20 in which the payroll period occurs, for employers under (a)(1) of this section; or 21 (2) the employer's annualized salary base is less than 50 percent of its 22 salary base for the fiscal year ending one year before the beginning of the fiscal year 23 in which the payroll period occurs, for employers under (a)(2) of this section. 24 (d) In this section, "salary base" means the total of all base salaries paid by the 25 employer to employees who are active members of the system. 26 * Sec. 3. AS 39.35.958(c) is repealed and reenacted to read: 27 (c) An employer shall pay a termination cost for a payroll period in which the 28 employer's salary base, if annualized, is 29 (1) $5,000,000 or more, and is less than 80 percent of the employer's 30 salary base for the fiscal year ending one year before the beginning of the fiscal year 31 in which the payroll period occurs; or 01 (2) $1,000,000 or more, but less than $5,000,000, and is less than 50 02 percent of the employer's salary base for the fiscal year ending one year before the 03 beginning of the fiscal year in which the payroll period occurs. 04 * Sec. 4. AS 39.35.958(e) is repealed and reenacted to read: 05 (e) An employer that is assessed a cost under (c) of this section shall pay the 06 cost, or enter into a payment plan acceptable to the administrator, within 60 days after 07 the employer receives notice from the administrator that the cost is assessed. A cost 08 assessed under (c) of this section and not paid within 60 days or in accordance with a 09 payment plan acceptable to the administrator shall be collected by the administrator in 10 accordance with AS 39.35.610(b). 11 * Sec. 5. AS 39.35.958 is amended by adding new subsections to read: 12 (g) The requirements in (c) of this section do not apply to a payroll period in 13 which the employer's annualized salary base is less than $1,000,000. 14 (h) Notwithstanding AS 39.35.255, an employer is subject to the termination 15 cost requirements in (c) of this section until the past service liability of the plan is 16 extinguished. The amount of a termination cost payment shall be calculated by 17 multiplying the current past service contribution rate adopted by the board by the 18 amount, in dollars, by which 19 (1) the employer's annualized salary base is less than 80 percent of its 20 salary base for the fiscal year ending one year before the beginning of the fiscal year 21 in which the payroll period occurs, as calculated under (c)(1) of this section; or 22 (2) the employer's annualized salary base is less than 50 percent of its 23 salary base for the fiscal year ending one year before the beginning of the fiscal year 24 in which the payroll period occurs, as calculated under (c)(2) of this section. 25 (i) An employer that has terminated participation in the plan is barred from 26 future participation in the plan until all payments owed by the employer under (e) of 27 this section are made. 28 (j) In this section, "salary base" means the total of all base salaries paid by the 29 employer to employees who are active members of the system. 30 * Sec. 6. AS 39.35.958(f) is repealed. 31 * Sec. 7. 2 AAC 35.235 is annulled. 01 * Sec. 8. The uncodified law of the State of Alaska is amended by adding a new section to 02 read: 03 APPLICABILITY. Notwithstanding sec. 9 of this Act, AS 39.35.625, as amended by 04 sec. 2 of this Act, AS 39.35.958(c) and (e), as amended by secs. 3 and 4 of this Act, and 05 AS 39.35.958(g) - (j), added by sec. 5 of this Act, apply only to termination costs paid on or 06 after the effective date of this Act. 07 * Sec. 9. The uncodified law of the State of Alaska is amended by adding a new section to 08 read: 09 RETROACTIVITY. AS 39.35.625, as amended by sec. 2 of this Act, AS 39.35.958 10 (c) and (e), as amended by secs. 3 and 4 of this Act, and AS 39.35.958(g) - (j), added by sec. 5 11 of this Act, are retroactive to July 1, 2008. 12 * Sec. 10. This Act takes effect immediately under AS 01.10.070(c).