SB 111: "An Act establishing the defined contribution retirement plan for public employees; requiring the preparation of certain actuarial valuations and actuarial and financial experience analyses of the teachers' retirement system; requiring the teachers' retirement system and the public employees' retirement system to be fully funded before granting a post retirement pension adjustment; and providing for an effective date."
00SENATE BILL NO. 111 01 "An Act establishing the defined contribution retirement plan for public 02 employees; requiring the preparation of certain actuarial valuations and actuarial 03 and financial experience analyses of the teachers' retirement system; requiring the 04 teachers' retirement system and the public employees' retirement system to be 05 fully funded before granting a post retirement pension adjustment; and providing 06 for an effective date." 07 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF ALASKA: 08 * Section 1. AS 39 is amended by adding new sections to read: 09 CHAPTER 38. DEFINED CONTRIBUTION RETIREMENT PLAN. 10 ARTICLE 1. ADMINISTRATION. 11 Sec. 39.38.010. PURPOSE AND EFFECTIVE DATE. (a) The purpose of this 12 chapter is to encourage qualified personnel to enter and remain in the service of the 13 state or a political subdivision or public organization of the state by establishing a plan 14 for the payment of retirement and death benefits to or on behalf of the employees.
01 (b) The program created becomes effective on July 1, 1993, at which time 02 contributions by the state and its employees begin. 03 Sec. 39.38.020. DEFINED CONTRIBUTION RETIREMENT PLAN BOARD. 04 (a) The Defined Contribution Retirement Plan Board composed of five members is 05 established. 06 (b) Three board members shall be members of the personnel board of the 07 Department of Administration. Two board members shall be members of the plan, 08 elected by a majority of votes cast by members of the plan. Elections shall be 09 conducted by the board. The term of office of an elected member is six years. A 10 vacancy in an unexpired elective term shall be filled by election for a new six-year 11 term. 12 (c) Members of the board serve without compensation, but are entitled to per 13 diem and transportation expenses authorized for boards under AS 39.20.180 to carry 14 out the duties set out in this chapter. 15 (d) Members of the board are subject to AS 39.50 (Conflict of Interest). 16 Sec. 39.38.030. DEFINED CONTRIBUTION RETIREMENT PLAN. The 17 board shall establish a defined contribution retirement plan for employees in which 18 retirement and death benefits are provided through the purchase of annuity contracts, 19 either fixed, variable, or a combination of fixed and variable, shares of a mutual fund, 20 guaranteed investment contracts, or other suitable pension savings investments. 21 Participation in the plan is in place of participation in a state retirement system. 22 Sec. 39.38.040. POWERS AND DUTIES OF THE BOARD. The board shall 23 (1) appoint an administrator of the plan and provide for the 24 administration of the plan, including procedures for resolving complaints from 25 participating employees; 26 (2) act as an appeals board, hold hearings at the request of an 27 employer, employee, surviving spouse or a beneficiary on decisions made by the 28 administrator, and submit its findings to the administrator; 29 (3) establish policies for the proper operation of the plan in consultation 30 with the Alaska State Pension Investment Board and carry on other activities necessary 31 to carry out the intent and purpose of this chapter.
01 Sec. 39.38.050. RESPONSIBILITIES OF THE ALASKA STATE PENSION 02 INVESTMENT BOARD. (a) The Alaska State Pension Investment Board is the 03 fiduciary of the fund. The investment board has the same powers and duties 04 established under this chapter in regard to the assets of the defined contribution 05 retirement plan as are provided in AS 14.25.035(d) and 14.25.180 for the teachers' 06 retirement fund. The first priority for investment of the assets is with the investment 07 entities designated under (b) of this section. 08 (b) The State Investment Board shall designate the company or other entity to 09 which payment of the contributions required under AS 39.38.210 may be made, after 10 considering the 11 (1) nature and extent of the rights and benefits that the contracts will 12 provide to employees who participate and to their beneficiaries; 13 (2) relation of the contractual rights and benefits to the contributions 14 to be made under this chapter; 15 (3) suitability of the contractual rights and benefits to the needs and 16 interests of participating employees and to the interest of the employer in the 17 employment and retention of employees; 18 (4) ability of the designated company or other entity to provide rights 19 and benefits under the contracts; and 20 (5) efficacy of the contracts in the recruitment and retention of 21 employees. 22 Sec. 39.38.060. DUTY OF EMPLOYERS TO FURNISH RECORDS. Each 23 employer shall furnish the administrator with records concerning the periods of service, 24 dates of birth, compensation, new entrants into service, death, withdrawals, and other 25 employee data necessary for the proper and effective operation of the plan. 26 Sec. 39.38.070. ATTORNEY GENERAL. The attorney general of the state 27 is the attorney for the plan and shall represent it in a legal proceeding. 28 ARTICLE 2. PARTICIPATION. 29 Sec. 39.38.100. PARTICIPATION. (a) An employee of the state first hired 30 on or after July 1, 1993, shall be included in the plan upon commencement of 31 employment with the state. Unless the employee has elected to participate in the
01 optional university retirement program, or was first hired before July 1, 1993, an 02 employee of a political subdivision, including a school district, regional educational 03 attendance area, and the University of Alaska, or a public organization that becomes 04 an employer shall be included in the plan on the effective date of the employer's 05 participation or the date of the employee's commencement of employment with the 06 employer, whichever is later. 07 (b) Inclusion in the plan is a condition of employment for an employee first 08 hired on or after July 1, 1993, except as otherwise provided for an elected official and 09 for an employee of the university who has elected to participate in the optional 10 university retirement program. 11 Sec. 39.38.110. PARTICIPATION BY MEMBERS OF A STATE 12 RETIREMENT SYSTEM. (a) A person who is a member of a state retirement 13 system may elect to participate in the defined contribution retirement plan. An 14 election to participate in the plan is irrevocable. The election shall be made in writing 15 on a form provided by the board and approved for the state by the commissioner of 16 administration. The form must be filed with the board and a copy of the form shall 17 be delivered to the appropriate state retirement system. The election becomes 18 irrevocable on the date it is received by the board. The election to participate in the 19 plan constitutes a waiver of all rights and benefits under the state retirement systems 20 earned on or after the effective date of the election. 21 (b) Except as provided in (d) of this section, if a member of a state retirement 22 system elects to participate in the plan, the member may choose to transfer the amount 23 in the employee's contribution account to the plan. If the member chooses to transfer 24 the account, the appropriate state retirement system shall pay to the plan on behalf of 25 the employee an amount equal to the balance in the account. The payment must be 26 made within 45 days after the election is received by the state retirement system. The 27 administrator of the plan shall immediately pay the amount received to the company 28 or other entity designated by the board for the benefit of the employee. 29 (c) If a vested member of a state retirement system elects to participate in the 30 plan without electing to transfer the amount in the employee's contribution account to 31 the plan, the employee ceases to be an active member of the retirement system on the
01 effective date of the participation in the plan. The employee retains all benefits 02 accrued in the state retirement system. 03 (d) An employee whose right to transfer assets out of a state retirement system 04 is subject to a qualified domestic relations order is entitled to transfer assets from the 05 state retirement system to the plan only if the requirements for receiving a refund 06 under AS 14.25.150(b) or AS 39.35.200(c), as appropriate, are met. 07 (e) An employee first hired before July 1, 1993, who does not elect to 08 participate in the plan under this section remains a member of the appropriate state 09 retirement system. 10 Sec. 39.38.120. PARTICIPATION OF ELECTED OFFICIALS. (a) Service 11 as an elected official with an employer constitutes employment as a member in the 12 plan as long as a written waiver of coverage has not been filed with the administrator. 13 A waiver under this subsection waives coverage of future employment as an elected 14 official, regardless of any change of employer. An elected official may file a waiver 15 under this subsection at any time after election to office, including the period before 16 taking the oath of office. An elected official may revoke a waiver under this 17 subsection by filing a written revocation with the administrator. A revocation under 18 this subsection operates prospectively only, and the elected official may not receive 19 coverage in the plan for service as an elected official while the waiver was in effect. 20 There is no limit on the number of times an elected official may file a waiver or 21 revocation under this subsection. 22 (b) An elected official included in the plan and that person's employer are 23 liable for contributions whenever that person is an elected official unless a waiver of 24 coverage under (a) of this section is in effect. 25 Sec. 39.38.130. PARTICIPATION BY OTHER EMPLOYEES. (a) A regular 26 full-time civilian employee of the Alaska Army National Guard or Alaska Air National 27 Guard, whose entire salary is paid from allotted federal funds, is included in the plan 28 if the federal or state government pays the employer's contributions. If the amount 29 that the federal government may legally contribute to the plan is less than the required 30 employer's contribution, the state government may contribute the difference. If the 31 state chooses not to pay the difference, the employee's participation shall be based on
01 the amount paid by the federal government. 02 (b) An employee of the North Pacific Fishery Management Council appointed 03 under 16 U.S.C. 1852(f)(1) (Sec. 302(f)(1) of P. L. 94-265), whose compensation is 04 paid from allotted federal funds, is included in the plan if the council pays the 05 employer's contributions. 06 (c) An administrative director of the Alaska court system who withdraws from 07 the judicial retirement system under AS 22.25.012 is eligible for membership in the 08 plan. 09 (d) An employee of the National Education Association of Alaska may 10 participate in the plan if the employee possesses or is eligible to possess a teacher 11 certificate under AS 14.20.020. 12 (e) An employee of the Special Education Service Agency may participate in 13 the plan if the employee possesses or is eligible to possess a teacher certificate under 14 AS 14.20.020. 15 (f) If an employer of an employee required or permitted to participate in the 16 plan under this section does not pay the employer's contributions when due, coverage 17 in the plan for the period of the delinquency may not be granted until the contributions 18 are paid. 19 ARTICLE 3. CONTRIBUTIONS, RIGHTS, AND BENEFITS. 20 Sec. 39.38.200. EMPLOYMENT CONTRIBUTIONS MANDATORY. 21 Contributions of employees shall be made by payroll deductions. Every included 22 employee is considered to consent to payroll deductions. It is of no consequence that 23 a payroll deduction may cause the compensation paid in cash to an employee to be 24 reduced below the minimum required by law. Payment of an employee's 25 compensation, less payroll deductions, is a full and complete discharge and satisfaction 26 of all claims and demands by the employee relating to remuneration of services during 27 the period covered by the payment. 28 Sec. 39.38.210. CONTRIBUTIONS. (a) Except as provided in 29 AS 39.38.130(a), the employer shall contribute to the plan on behalf of each employee 30 participating in the plan an amount equal to 9.65 percent of the employee's 31 compensation.
01 (b) An employee participating in the plan shall contribute to the plan an 02 amount set by the administrator. The amount may not be less than one-half of the 03 amount of the employer contribution. The administrator may increase or decrease the 04 contributions required of employees under this subsection during the course of a 05 person's employment. 06 (c) The administrator may specify that contributions required by this section 07 are made by a reduction in salary under 26 U.S.C. 414(h)(2) (Internal Revenue Code). 08 (d) The administrator shall pay the contributions required by this section to the 09 designated investment entities, company, or companies for the benefit of each 10 participant. 11 Sec. 39.38.220. BENEFITS. (a) Payment of benefits to participants of the 12 plan is the responsibility of the company or other entity designated by the Alaska State 13 Pension Investment Board and is not the responsibility of the investment board, the 14 retirement board, the employer, or the state. The benefits are payable to participants 15 or their beneficiaries under the terms of the annuity contract or contracts or other 16 investments. 17 (b) The retirement board shall purchase and offer participation in a group 18 health plan to members who have retired. The participating members shall pay the 19 cost of the health plan. 20 Sec. 39.38.230. RIGHTS UNDER QUALIFIED DOMESTIC RELATIONS 21 ORDER. A former spouse shall be treated as a spouse or surviving spouse to the 22 extent required by a qualified domestic relations order. Rights under the order do not 23 take effect until the order is filed with the administrator. 24 Sec. 39.38.240. SAFEGUARD OF EMPLOYEE FUNDS HELD BY THE 25 PLAN. Employee contributions and other amounts held in the plan are exempt from 26 Alaska state and local taxes. Amounts held on behalf of, or payable to, any employee 27 or other person who is or may become eligible for benefits under the plan are not 28 subject to anticipation, alienation, sale, transfer, assignment, pledge, encumbrance, or 29 charge of any kind, either voluntary or involuntary, before being received by the 30 person entitled to the amount under the terms of the plan. An attempt to anticipate, 31 alienate, sell, transfer, assign, pledge, encumber, charge, or otherwise dispose of a right
01 to amounts held under the plan is void. However, an employee's right to receive 02 benefits may be assigned under a qualified domestic relations order. 03 Sec. 39.38.260. EXEMPTION OF EMPLOYEE FUNDS AND BENEFITS. 04 Employee contributions and other amounts held in the plan and retirement benefits 05 payable under the plan are exempt from levy to enforce the collection of a debt as 06 provided in AS 09.38 (exemptions). 07 ARTICLE 4. POLITICAL SUBDIVISIONS AND PUBLIC ORGANIZATIONS. 08 Sec. 39.38.300. REQUEST TO PARTICIPATE. (a) A municipality or other 09 political subdivision of the state may request to become an employer in the plan. The 10 request shall be made after adoption of a resolution by the legislative body of the 11 political subdivision and after approval of the resolution by the person required by law 12 to approve it. A certified copy of the resolution shall be filed with the administrator. 13 If the administrator approves the request for participation, the political subdivision is 14 an employer of the plan. 15 (b) A public organization may request to become an employer in the plan. 16 The request shall be made after adoption of a resolution by the governing body of the 17 public organization. A certified copy of the resolution shall be filed with the 18 administrator. If the administrator approves the request for participation, the public 19 organization is an employer of the plan. 20 Sec. 39.38.310. SURVEY TO DETERMINE ESTIMATED COST. A political 21 subdivision or public organization contemplating participation in the plan may request 22 a preliminary survey to determine the estimated cost of participation, the benefits 23 derived, and other information that is appropriate. The political subdivision or public 24 organization requesting the survey shall pay the cost of it. 25 Sec. 39.38.320. PARTICIPATION. (a) The effective date of participation in 26 the plan by a political subdivision or public organization is the first day of any month 27 acceptable to the governing body of the political subdivision or public organization and 28 to the board. 29 (b) The political subdivision or public organization shall designate the 30 departments, groups, or other classifications of employees eligible to participate in the 31 plan, and shall agree to make the contributions each year that are required by the
01 administrator. 02 (c) The eligible employees of a participating political subdivision or public 03 organization are bound by the provisions of this plan and are entitled to the benefits 04 provided under it. 05 Sec. 39.38.330. CONTRIBUTIONS AND TERMINATION OF 06 PARTICIPATION FOR NONPAYMENT. (a) The contributions of an employer that 07 is a participating political subdivision or public organization and the contributions of 08 its employees shall be transmitted to the administrator as soon as practicable after the 09 close of the payroll period for which the contributions are made. If the employer is 10 delinquent in transferring the contributions for more than 15 days, interest and other 11 penalties shall be assessed on the outstanding contributions at the rate and in the 12 amount established by the board. 13 (b) If the contributions are not transmitted to the administrator within the 14 prescribed time limit, the administrator may grant an extension. If the political 15 subdivision or public organization is in default at the end of the extension, 16 participation in the plan is terminated, and the employer shall be sent notice of 17 termination. 18 (c) Termination of an employer's participation in the plan does not bar future 19 participation in the plan by that employer. 20 Sec. 39.38.350. EFFECT OF TERMINATION BY AMENDMENT OF 21 AGREEMENT. (a) A political subdivision or public organization may request that 22 its participation agreement be amended. The request may be made only after adoption 23 of a resolution by the legislative body of the political subdivision and approval of the 24 resolution by the person required by law to approve the resolution, or, in the case of 25 a public organization, after adoption of a resolution by the governing body of that 26 public organization. A certified copy of the resolution shall be filed with the 27 administrator. 28 (b) Termination of coverage of a department, group, or other classification of 29 employees does not bar future coverage of that department, group, or classification. 30 ARTICLE 5. GENERAL PROVISIONS. 31 Sec. 39.38.450. NONGUARANTEE OF EMPLOYMENT. This chapter is not
01 a contract of employment between an employer and an employee, nor does it confer 02 a right of an employee to be continued in the employment of an employer, nor is it a 03 limitation of the right of an employer to discharge an employee with or without cause. 04 Sec. 39.38.460. FRAUD. A person who knowingly makes a false statement, 05 or knowingly falsifies or permits to be falsified a record of this plan, in an attempt to 06 defraud the plan, is guilty of a Class A misdemeanor. 07 Sec. 39.38.900. DEFINITIONS. In this chapter, 08 (1) "administrator" means the administrator of the defined contribution 09 retirement plan; 10 (2) "appropriate state retirement system" means the state retirement 11 system that includes the employee's position; 12 (3) "board" means the Defined Contribution Retirement Plan Board 13 established under AS 39.38.020; 14 (4) "compensation" means the total remuneration earned by an 15 employee for personal services rendered to an employer, including employee 16 contributions under AS 39.38.210, cost-of-living differentials, payments for leave that 17 is actually used by the employee, the amount by which the employee's wages are 18 reduced under AS 39.30.150(c), and any amount deferred under an employer-sponsored 19 deferred compensation plan, but does not include retirement benefits, severance pay 20 or other separation bonuses, welfare benefits, per diem, expense allowances, workers' 21 compensation payments, incentive cash awards, or payments for leave not used by the 22 employee whether those leave payments are scheduled payments, lump-sum payments, 23 donations, or cash-ins; 24 (5) "contribution account" means the member contribution account 25 under AS 14.25, the employee contribution account under AS 39.35, or, for an 26 administrative director of the Alaska court system electing to participate in the plan, 27 the total maintained by the judicial retirement system of the administrative director's 28 mandatory contributions, indebtedness principal, contributions of interest on 29 indebtedness, interest credited to each of those accounts, and adjustments to the 30 accounts, whichever is appropriate; 31 (6) "elected official" means a person whose compensation results from
01 personal services rendered to an employer as an elected representative; 02 (7) "employer" means the State of Alaska, a political subdivision or 03 public organization of the state that participates in the plan, or an employer under 04 AS 39.38.120 or 39.38.130 that participates in the plan; 05 (8) "member" or "employee" 06 (A) means a person who is eligible to participate in the plan and 07 who is covered by the plan; 08 (B) includes an elected public officer under AS 39.38.120 and 09 other employees participating under AS 39.38.130; 10 (C) does not include 11 (i) former members; 12 (ii) persons compensated on a contractual or fee basis; 13 (iii) casual or emergency workers or nonpermanent 14 employees as defined in AS 39.25.200; 15 (iv) except as provided in AS 39.38.110, members of the 16 Alaska teachers' retirement system (AS 14.25), the judicial retirement 17 system (AS 22.25), the public employees' retirement system 18 (AS 39.35), the elected public officers' retirement system (former 19 AS 39.37), or the optional university retirement program; 20 (v) employees of the division of marine transportation 21 engaged in operating the state ferry system who are covered by a union 22 or group retirement system to which the state makes contributions; and 23 (vi) the administrative director of courts appointed under 24 art. IV, sec. 16 of the state constitution unless the director becomes a 25 member under AS 39.38.130(c); 26 (D) may include employees of the division of marine 27 transportation excluded under (C)(v) of this paragraph provided that 28 (i) the State of Alaska formally agrees to their inclusion 29 through the process of collective bargaining; and 30 (ii) no collective bargaining agreement has the effect of 31 obligating contributions made by the state under AS 39.30.150 in the
01 event the state resumes participation in the federal social security 02 system; 03 (9) "optional university retirement program" means the program 04 established under AS 14.40.661 - 14.40.799; 05 (10) "plan" means the defined contribution retirement plan established 06 in this chapter; 07 (11) "public organization" means an organization or entity 08 (A) created by the constitution or laws of the state for the 09 purpose of administering state programs; 10 (B) whose officers and employees are paid by a method other 11 than by the state payroll prepared by the Department of Administration; and 12 (C) whose employees are not required by law to participate in 13 the plan; 14 (12) "qualified domestic relations order" has the meaning given in 15 AS 39.35.680; 16 (13) "state retirement system" means the teachers' retirement system 17 under AS 14.25, the public employees' retirement system under AS 39.35, or, for an 18 administrative director of the Alaska court system who elects to participate in the plan 19 under AS 22.25.012, the judicial retirement system under AS 22.25. 20 * Sec. 2. AS 14.25.035(c) is amended to read: 21 (c) The board shall 22 (1) confer with the commissioner of administration regarding the 23 administration of the system and may make recommendations that it considers 24 necessary; 25 (2) have prepared, at least biennially, an actuarial valuation of the 26 total obligations under the system of each employer and, on the basis of the 27 valuation, shall certify to the appropriate budgetary authorities of each employer: 28 (A) an appropriate contribution rate for all employers; and 29 (B) an amount appropriate for each employer to liquidate 30 the employee's past service liability; the board shall have an actuarial and 31 financial experience analysis of the system conducted at appropriate
01 intervals, but no less frequently than once every six years; the actuarial 02 valuations and the actuarial and financial experience analysis shall be 03 prepared and certified by a member of the American Academy of 04 Actuaries. 05 * Sec. 3. AS 14.25.040(a) is amended to read: 06 (a) Unless a teacher or member has elected to participate in the optional 07 university retirement program under AS 14.40.661 - 14.40.799 or the defined 08 contribution retirement plan under AS 39.38, a teacher or member contracting for 09 service with a participating employer who became a member of this system before 10 July 1, 1993, is subject to this chapter. 11 * Sec. 4. AS 14.25.045(a) is amended to read: 12 (a) An employee or former employee of the National Education Association 13 of Alaska may participate in the system under this chapter if the employee or former 14 employee elects to participate before July 1, 1993, and if the employee or former 15 employee 16 (1) [THE EMPLOYEE OR FORMER EMPLOYEE] possesses or is 17 eligible to possess a teacher certificate under AS 14.20.020; and 18 (2) [THE EMPLOYEE OR FORMER EMPLOYEE] of the National 19 Education Association of Alaska pays all retroactive contributions required to be made 20 under this chapter. 21 * Sec. 5. AS 14.25.047 is amended to read: 22 Sec. 14.25.047. PARTICIPATION BY SPECIAL EDUCATION SERVICE 23 AGENCY EMPLOYEES. An employee of the Special Education Service Agency first 24 hired before July 1, 1993, may participate in the system under this chapter if 25 (1) the employee possesses or is eligible to possess a teacher certificate 26 under AS 14.20.020; and 27 (2) the employee pays all retroactive contributions required to be made 28 under this chapter. 29 * Sec. 6. AS 14.25.115(a) is amended to read: 30 (a) A teacher in membership service on or after July 1, 1977, and before 31 July 1, 1993, who is appointed to retirement on or after July 1, 1978, may elect to
01 apply unused sick leave credit in computing the total number of years of credited 02 service under AS 14.25.110(d) except for sick leave earned while participating in the 03 optional university retirement program under AS 14.40.661 - 14.40.799 or in the 04 defined contribution retirement plan under AS 39.38. To obtain service credit for 05 unused sick leave, a teacher must apply to the administrator no later than one year 06 after appointment to retirement. Unused sick leave shall be credited on a day-for-day 07 basis in accordance with the table for service after July 1, 1969, contained in 08 AS 14.25.220(43). Teacher contributions may not be required for credited unused sick 09 leave. 10 * Sec. 7. AS 14.25.143(a) is amended to read: 11 (a) If the administrator determines that the system will be 100 percent 12 actuarially funded after granting an increase to benefits for the [ONCE EACH] 13 year, the administrator shall increase benefit payments to eligible disabled members, 14 to persons age 60 or older receiving benefits under this system in the preceding 15 calendar year, and to persons who have received benefits under this system for at least 16 eight years who are not otherwise eligible for an increase under this section. 17 * Sec. 8. AS 14.25.220(40) is amended to read: 18 (40) "teacher" or "member" means a person first hired before July 1, 19 1993, who is eligible to participate in the system, [AND] who is covered by the 20 system, and who has not chosen to participate in the defined contribution 21 retirement plan, limited to 22 (A) a certificated full-time or part-time elementary or secondary 23 teacher, a certificated school nurse, or a certificated person in a position 24 requiring a teaching certificate as a condition of employment in a public school 25 of the state; 26 (B) the commissioner of education and all supervisory positions 27 in the Department of Education; 28 (C) a full-time or part-time teacher of the University of Alaska 29 or a person occupying a full-time administrative position at the University of 30 Alaska that requires academic standing; the approval of the administrator must 31 be obtained before an administrative position qualifies for membership in the
01 system; however, a teacher or administrative person at the university who is 02 participating in the optional university retirement program under 03 AS 14.40.661 - 14.40.799 is not a member under this system; 04 (D) a state legislator who elects membership under 05 AS 14.25.040(b); 06 * Sec. 9. AS 22.25.012(c) is amended to read: 07 (c) An administrative director first hired before July 1, 1993, who withdraws 08 from the judicial retirement system under (b) of this section is eligible for membership 09 in the public employees' retirement system (AS 39.35) and shall receive credited 10 service in that system for service rendered as administrative director. An 11 administrative director hired on or after July 1, 1993, who withdraws from the 12 judicial retirement system is eligible for membership in the defined contribution 13 retirement plan (AS 39.38) from the date of withdrawal. To be eligible for 14 membership in the public employees' retirement system under this subsection, the 15 administrative director must contribute to the public employees' retirement system 16 (1) the amount that would have been contributed if the administrative 17 director had been a member during the period of the membership in the judicial 18 retirement system; and 19 (2) any contributions for service as administrative director refunded 20 from the public employees' retirement system at the time the administrative director 21 became a member of the judicial retirement system. 22 * Sec. 10. AS 22.25.012 is amended by adding a new subsection to read: 23 (d) An administrative director who chooses to withdraw from the judicial 24 retirement system and participate in the defined contribution retirement plan must 25 contribute to the plan the amount required under (c) of this section for participation 26 in the public employees' retirement system. The judicial retirement system shall 27 transfer to the defined contribution retirement plan the amount in the employee 28 contribution account, the amount of the employer contributions, and interest earned on 29 both employee and employer contributions as required of the public employees' 30 retirement system for members of that system. 31 * Sec. 11. AS 37.10.220(c) is amended to read:
01 (c) The board shall meet annually, either jointly or separately, with the Public 02 Employees' Retirement Board, the Teachers' Retirement Board, the Defined 03 Contribution Retirement Plan Board and the Department of Administration to 04 review benefit administration of each of the retirement systems and of the employee 05 benefits program established under AS 39.30.150 - 39.30.180 and the deferred 06 compensation program under AS 39.45. The Department of Administration and each 07 retirement board shall report to the investment board on benefit administration and 08 other issues for that retirement system or program that may affect the investment and 09 management of the fund. 10 * Sec. 12. AS 37.10.390(2) is amended to read: 11 (2) "retirement systems" means the teachers' retirement system, the 12 judicial retirement system, the Alaska National Guard and Alaska Naval Militia 13 retirement system, the defined contribution retirement plan, and the public 14 employees' retirement system. 15 * Sec. 13. AS 39.35.120 is amended to read: 16 Sec. 39.35.120. COMMENCEMENT OF PARTICIPATION. (a) Unless the 17 employee has elected to participate in the defined contribution retirement plan 18 under AS 39.38, an [AN] employee of the state who was first hired before July 1, 19 1993, shall be included in this system upon commencement of employment with the 20 state, or on January 1, 1961, whichever is later. Unless an employee has elected to 21 participate in the optional university retirement program under AS 14.40.661 - 22 14.40.799 or the defined contribution retirement plan under AS 39.38, an employee 23 of a political subdivision or public organization that becomes an employer who was 24 first hired before July 1, 1993, shall be included in the system on the effective date 25 of the employer's participation or the date of the employee's commencement of 26 employment with the employer, whichever is later. 27 (b) Inclusion in the system is a condition of employment for an employee who 28 was first hired before July 1, 1993, except as otherwise provided for an elected 29 official, an employee who has elected to participate in the defined contribution 30 retirement plan under AS 39.38, and for an employee of the university who has 31 elected to participate in the optional university retirement program under
01 AS 14.40.661 - 14.40.799. 02 * Sec. 14. AS 39.35.158 is amended to read: 03 Sec. 39.35.158. ADMINISTRATIVE DIRECTOR OF COURTS. An 04 administrative director of the Alaska court system first hired before July 1, 1993, 05 who withdraws from the judicial retirement system under AS 22.25.012 and who has 06 not elected to participate in the defined contribution retirement plan is eligible for 07 membership in the system and shall receive credited service in the system for service 08 rendered as administrative director. To be eligible for membership in the system under 09 this subsection, the administrative director must contribute to the system 10 (1) the amount the director would have contributed if the director had 11 been a member during the director's period of membership in the judicial retirement 12 system; and 13 (2) any contributions for services as administrative director refunded 14 by the system at the time the director became a member of the judicial retirement 15 system. 16 * Sec. 15. AS 39.35.475(a) is amended to read: 17 (a) If the administrator determines that the system will be 100 percent 18 actuarially funded after granting an increase to benefits for the year, [ONCE 19 EACH YEAR] the administrator shall increase benefit payments to eligible disabled 20 members, to persons age 60 or older receiving benefits under this system in the 21 preceding calendar year, and to persons who have received benefits under this system 22 for at least five years who are not otherwise eligible for an increase under this section. 23 * Sec. 16. AS 39.35.550 is amended to read: 24 Sec. 39.35.550. REQUEST BY POLITICAL SUBDIVISION TO 25 PARTICIPATE AND ADOPTION OF RESOLUTION. A municipality or other 26 political subdivision of the state may, before July 1, 1993, request to become an 27 employer in this system. The request shall be made after adoption of a resolution by 28 the legislative body of the political subdivision and after approval of the resolution by 29 the person required by law to approve the resolution. A certified copy of the 30 resolution shall be filed with the administrator. If the administrator approves the 31 request for participation, the political subdivision is an employer of the system.
01 * Sec. 17. AS 39.35.560 is amended to read: 02 Sec. 39.35.560. REQUEST BY PUBLIC ORGANIZATION TO 03 PARTICIPATE AND ADOPTION OF RESOLUTION. A public organization may, 04 before July 1, 1993, request to become an employer in this system. The request shall 05 be made after adoption of a resolution by the governing body of the public 06 organization. A certified copy of the resolution shall be filed with the administrator. 07 If the administrator approves the request for participation, the public organization is 08 an employer of the system. 09 * Sec. 18. AS 39.35.680(21) is amended to read: 10 (21) "member" or "employee" 11 (A) means a person eligible to participate in the system who 12 was first hired before July 1, 1993, and who is covered by the system; 13 (B) includes 14 (i) active member; 15 (ii) inactive member; 16 (iii) vested member; 17 (iv) deferred vested member; 18 (v) non-vested member; 19 (vi) disabled member; 20 (vii) retired member; 21 (viii) an elected public officer under AS 39.35.381; 22 (C) does not include 23 (i) former members; 24 (ii) persons compensated on a contractual or fee basis; 25 (iii) casual or emergency workers or nonpermanent 26 employees as defined in AS 39.25.200; 27 (iv) persons covered by the Alaska Teachers' Retirement 28 System except as provided under AS 39.35.131 and 39.35.381, persons 29 covered by the defined contribution retirement plan, or persons 30 covered by the optional university retirement program; 31 (v) employees of the division of marine transportation
01 engaged in operating the state ferry system who are covered by a union 02 or group retirement system to which the state makes contributions; 03 (vi) justices of the supreme court or judges of the court 04 of appeals or of the superior or district courts of Alaska; 05 (vii) the administrative director of courts appointed 06 under art. IV, sec. 16 of the state constitution unless the director 07 becomes a member under AS 39.35.158; and 08 (viii) members of the elected public officers' retirement 09 system (former AS 39.37); 10 (D) may include employees of the division of marine 11 transportation excluded under (C)(v) of this paragraph provided that 12 (i) the State of Alaska formally agrees to their inclusion 13 through the process of collective bargaining; and 14 (ii) no collective bargaining agreement has the effect of 15 obligating contributions made by the state under AS 39.30.150 in the 16 event the state resumes participation in the federal social security 17 system; 18 * Sec. 19. AS 39.50.200(b) is amended by adding a new paragraph to read: 19 (55) Defined Contribution Retirement Plan Board (AS 39.38.020). 20 * Sec. 20. Section 7, ch. 26, SLA 1986, as amended by sec. 7, ch. 104, SLA 1989, is 21 further amended to read: 22 Sec. 7. INDEBTEDNESS ON REEMPLOYMENT. If a participant in the 23 retirement incentive program is reemployed as a member of the Public Employees' 24 Retirement System under AS 39.35, the optional university retirement program under 25 AS 14.40.661 - 14.40.799, the defined contribution retirement plan under 26 AS 39.38, or the Teachers' Retirement System under AS 14.25 after appointment to 27 retirement under the program, the participant loses the incentive credit received under 28 sec. 5 (c) of this Act and is indebted to the system. The amount of the indebtedness 29 is equal to 110 percent of the amount the participant received as a result of 30 participation in the program for which the participant was not otherwise entitled, in- 31 cluding the cost of health insurance. The participant is entitled to a credit to be
01 applied against the reemployment indebtedness in the amount the participant has paid 02 under sec. 5 (d) of this Act. Interest accrues on the indebtedness at the rate established 03 by regulation from the date of reemployment until the member is appointed to 04 retirement and accepts an actuarial adjustment to the member's future benefits or until 05 the amount is paid in full. 06 * Sec. 21. Section 9(a), ch. 89, SLA 1989, as amended by sec. 6, ch. 18. SLA 1990, is 07 amended to read: 08 (a) If a participant in the retirement incentive program is reemployed as a 09 member of the public employees' retirement system under AS 39.35, [OR] the 10 teachers' retirement system under AS 14.25, or the defined contribution retirement 11 plan under AS 39.38, after appointment to retirement under the retirement incentive 12 program, the participant loses the incentive credit received under sec. 2(g) of this Act 13 and is indebted to the system. The amount of the indebtedness is equal to 110 percent 14 of the amount the participant received as a result of participation in the program to 15 which the participant was not otherwise entitled, including the cost of health insurance. 16 The participant is entitled to a credit to be applied against the reemployment 17 indebtedness in the amount the participant has paid under sec. 2(e), (f), and (i) of this 18 Act. Interest accrues on the indebtedness at the rate established by regulation from the 19 date of reemployment until the member is appointed to retirement and accepts an 20 actuarial adjustment to the member's future benefits or until the amount is paid in full. 21 * Sec. 22. Notwithstanding AS 39.38.210, enacted by sec. 1 of this Act, the employee 22 contribution rate in effect for a position on June 30, 1993, shall be the employee contribution 23 rate for that position until the rate is amended by the Defined Contribution Retirement Plan 24 Board. 25 * Sec. 23. Notwithstanding AS 39.38.020, the initial Defined Contribution Retirement Plan 26 Board shall consist of the three members of the personnel board of the Department of 27 Administration. As soon as there are 300 members in the plan, the board shall conduct 28 elections under AS 39.38.020(b) to add the two board members who are members of the plan. 29 Notwithstanding AS 39.38.020(b), the initial two elected members shall serve staggered terms. 30 The elected members are considered members of the board on the date that the initial board 31 accepts the final results of the election.