SCS CSHB 242(FIN): "An Act relating to reemployment of and medical benefits for retired members of the teachers' retirement system and public employees' retirement system; relating to the inclusion of cost-of-living differentials on compensation and benefits under the public employees' retirement system; and providing for an effective date."
00 SENATE CS FOR CS FOR HOUSE BILL NO. 242(FIN) 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 14.20 is amended by adding a new section to read: 07 Sec. 14.20.135. Employment of retired teachers because of shortages. (a) 08 A school district or regional educational attendance area that has or anticipates having 09 a shortage of teachers qualified to teach in a particular discipline or specialty may, by 10 resolution, adopt a policy that permits the employment of retired teachers who are 11 qualified to teach in the discipline or specialty in accordance with this section. The 12 policy must describe the circumstances that constitute the shortage. If a shortage of 13 teachers exists as described in the policy, the district or attendance area shall notify the 14 administrator of the teachers' retirement system (AS 14.25) that it is hiring retired
01 teachers under this section. 02 (b) A teacher who retired under AS 14.25.110(a) and is subsequently 03 reemployed under this section may, within 30 days after the date of reemployment, 04 elect to continue receiving retirement benefit payments under AS 14.25 during the 05 period of reemployment by filing a waiver of coverage as set out in AS 14.25.043(b). 06 (c) A school district or regional educational attendance area may not employ a 07 teacher, principal, or administrator who participated in a retirement incentive program 08 under ch. 26, SLA 1986; ch. 89, SLA 1989; ch. 65, SLA 1996; ch. 4, FSSLA 1996; or 09 ch. 92, SLA 1997, under this section. 10 (d) A retired teacher employed under this section is not eligible to acquire, 11 maintain, or reacquire tenure under AS 14.20.150. 12 * Sec. 2. AS 14.25.040(a) is amended to read: 13 (a) Unless a teacher or member has elected to participate in the optional 14 university retirement program under AS 14.40.661 - 14.40.799 or has filed an 15 election under AS 14.25.043(b), a teacher or member contracting for service with a 16 participating employer is subject to this chapter. 17 * Sec. 3. AS 14.25.040(a) is amended to read: 18 (a) Unless a teacher or member has elected to participate in the optional 19 university retirement program under AS 14.40.661 - 14.40.799 [OR HAS FILED AN 20 ELECTION UNDER AS 14.25.043(b)], a teacher or member contracting for service 21 with a participating employer is subject to this chapter. 22 * Sec. 4. AS 14.25.043 is amended to read: 23 Sec. 14.25.043. Reemployment of retired members. (a) If a retired member 24 again becomes an active member, benefit payments may not be made during the 25 period of reemployment unless the teacher makes an election under (b) of this 26 section. The retirement benefit must be suspended for the entire school year if the 27 teacher is reemployed as an active teacher for a period equivalent to a year of service. 28 During the period of reemployment, the member is subject to AS 14.25.050 and 29 deductions from the member's salary will be made in accordance with AS 14.25.050. 30 (b) A school district or regional educational attendance area that has 31 adopted a policy that permits the employment of retired teachers in accordance
01 with AS 14.20.135 shall notify the administrator that it is hiring retired teachers 02 under AS 14.20.135. A teacher who retired under AS 14.25.110(a) and 03 subsequently becomes an active member under a policy adopted in accordance 04 with AS 14.20.135 may, within 30 days of the date of reemployment, elect to 05 continue receiving benefit payments during the period of reemployment by filing 06 a waiver of coverage with the administrator on a form provided by the 07 administrator. An election under this subsection waives coverage for the period 08 of reemployment and is irrevocable during the period of reemployment. 09 Deductions from the member's salary may not be made under AS 14.25.050 10 during the period of reemployment, and the member may not receive credited 11 service for the period of reemployment. A member who participated in a 12 retirement incentive program under ch. 26, SLA 1986; ch. 89, SLA 1989; ch. 65, 13 SLA 1996; ch. 4, FSSLA 1996; or ch. 92, SLA 1997, is not eligible to make an 14 election under this subsection. 15 (c) Upon subsequent retirement, the retired member is entitled to receive an 16 additional benefit based on the credited service and the average base salary during the 17 period of reemployment in accordance with AS 14.25.110. If the initial benefit 18 payments to which the retired member is eligible have been actuarially reduced 19 because the member retired early under AS 14.25.110(b), the member shall also 20 receive an incremental benefit based on the amount of the actuarial reduction imposed 21 by AS 14.25.110(j) on the first benefit and the length of time that the employee was 22 reemployed and not receiving retirement benefits. The amount of the incremental 23 benefit is equal to the difference between the normal retirement benefit to which the 24 member would have been entitled had the member taken a normal retirement and the 25 early retirement benefit that the member has been receiving based on the member's 26 initial period of employment multiplied by the total number of months that the 27 member did not receive retirement benefits because of reemployment and that amount 28 actuarially adjusted to be paid over the expected lifetime of the member. 29 * Sec. 5. AS 14.25.043(a) is amended to read: 30 (a) If a retired member again becomes an active member, benefit payments 31 may not be made during the period of reemployment [UNLESS THE TEACHER
01 MAKES AN ELECTION UNDER (b) OF THIS SECTION]. The retirement benefit 02 must be suspended for the entire school year if the teacher is reemployed as an active 03 teacher for a period equivalent to a year of service. During the period of 04 reemployment, [THE MEMBER IS SUBJECT TO AS 14.25.050 AND] deductions 05 from the member's salary will be made in accordance with AS 14.25.050. 06 * Sec. 6. AS 14.25.168(d) is amended to read: 07 (d) A benefit recipient may elect major medical insurance coverage in 08 accordance with regulations and under the following conditions: 09 (1) a person who has less than 25 years of membership service and 10 who is younger than 60 years of age must pay an amount equal to the full monthly 11 group premium for retiree major medical insurance coverage; 12 (2) [A PERSON WHO IS AT LEAST 60 YEARS OF AGE BUT IS 13 YOUNGER THAN 65 YEARS OF AGE MUST PAY AN AMOUNT EQUAL TO 14 ONE-HALF OF THE FULL MONTHLY GROUP PREMIUM FOR RETIREE 15 MAJOR MEDICAL INSURANCE COVERAGE; 16 (3)] a disabled member, a disabled member who is appointed to 17 normal retirement, [OR] a person 60 [65] years of age or older, or a person who has 18 at least 25 years of membership service is not required to make premium payments. 19 * Sec. 7. AS 39.35.120(b) is amended to read: 20 (b) Inclusion in the system is a condition of employment for an employee 21 except as otherwise provided for an 22 (1) elected official; 23 (2) employee making an election under AS 39.35.150(b); and 24 (3) [FOR AN] employee of the university who has elected to 25 participate in the optional university retirement program under AS 14.40.661 - 26 14.40.799. 27 * Sec. 8. AS 39.35.150 is amended to read: 28 Sec. 39.35.150. Re-employment of retired employees. (a) If a retired 29 employee subsequently becomes an active member, benefit payments may not be 30 made during the period of re-employment unless the member makes an election 31 under (b) of this section. During the period of re-employment, deductions from the
01 employee's salary shall be made in accordance with AS 39.35.160. Upon subsequent 02 retirement, the retired employee is entitled to receive an additional pension based on 03 the credited service and the average monthly compensation earned during the period 04 of re-employment in accordance with AS 39.35.370. 05 (b) A member who retired under AS 39.35.370(a) and subsequently 06 becomes an active member may, within 30 days of the date of reemployment, 07 elect to continue receiving benefit payments during the period of reemployment 08 by filing an election with the administrator on a form provided by the 09 administrator. An election under this subsection waives coverage for the period 10 of reemployment and is irrevocable during the period of reemployment. During 11 the period of reemployment, deductions from the member's salary may not be 12 made under AS 39.35.160 and the member may not receive credited service. A 13 member who participated in a retirement incentive program under ch. 26, SLA 14 1986; ch. 89, SLA 1989; ch. 65, SLA 1996; ch. 4, FSSLA 1996; or ch. 92, SLA 15 1997, is not eligible to make an election under this subsection. 16 (c) A member who has not made an election under (b) of this section is 17 subject to AS 39.35.120 and 39.35.160. 18 (d) If the initial benefit payments to which the retired member is eligible have 19 been reduced because the member retired early under AS 39.35.370(b) or increased 20 because the member elected to receive a level income option benefit under former 21 AS 39.35.460, the member shall also receive an incremental benefit based on the 22 amount of the reduction imposed by AS 39.35.370(b) or the increase under former 23 AS 39.35.460 on the first benefit and the length of time that the employee was 24 reemployed and not receiving retirement benefits. The amount of the incremental 25 benefit is equal to the difference between the normal retirement benefit to which the 26 member would have been entitled had the member taken a normal retirement and the 27 early retirement benefit or benefit under the level income option that the member has 28 been receiving based on the member's initial period of employment multiplied by the 29 total number of months that the member did not receive retirement benefits because of 30 reemployment and that amount actuarially adjusted to be paid over the expected 31 lifetime of the member. In the case of a member who selected benefits under the level
01 income option, the total number of months may not include any month in which the 02 member was 65 years of age or older. 03 * Sec. 9. AS 39.35.150(a) is amended to read: 04 (a) If a retired employee subsequently becomes an active member, benefit 05 payments may not be made during the period of re-employment [UNLESS THE 06 MEMBER MAKES AN ELECTION UNDER (b) OF THIS SECTION]. During the 07 period of re-employment, deductions from the employee's salary shall be made in 08 accordance with AS 39.35.160. Upon subsequent retirement, the retired employee is 09 entitled to receive an additional pension based on the credited service and the average 10 monthly compensation earned during the period of re-employment in accordance with 11 AS 39.35.370. 12 * Sec. 10. AS 39.35.535(c) is repealed and reenacted to read: 13 (c) A benefit recipient may elect major medical insurance coverage in 14 accordance with regulations and under the following conditions: 15 (1) a person, other than a disabled member or a disabled member who 16 is appointed to normal retirement, must pay an amount equal to the full monthly group 17 premium for retiree major medical insurance coverage if the person is 18 (A) younger than 60 years of age and has less than 19 (i) 25 years of credited service as a peace officer under 20 AS 39.35.360 and 39.35.370; or 21 (ii) 30 years of credited service under AS 39.35.360 and 22 39.35.370 that is not service as a peace officer; or 23 (B) of any age and has less than 10 years of credited service; 24 (2) a person is not required to make premium payments for retiree 25 major medical coverage if the person 26 (A) is a disabled member; 27 (B) is a disabled member who is appointed to normal 28 retirement; 29 (C) is 60 years of age or older and has at least 10 years of 30 credited service; or 31 (D) has at least
01 (i) 25 years of credited service as a peace officer under 02 AS 39.35.360 and 39.35.370; or 03 (ii) 30 years of credited service under AS 39.35.360 and 04 39.35.370 not as a peace officer. 05 * Sec. 11. AS 39.35.675(b) is amended to read: 06 (b) The amount of a cost-of-living differential may not be included in the 07 employee's compensation for purposes of calculating benefits paid under this chapter 08 unless the employee has received a cost-of-living differential [IN A COMPARABLE 09 AMOUNT OR OF AT LEAST THAT MANY STEPS] for at least 50 percent of the 10 employee's credited service. 11 * Sec. 12. AS 14.20.135; AS 14.25.043(b); AS 39.35.120(b)(2), 39.35.150(b), and 12 39.35.150(c) are repealed July 1, 2005. 13 * Sec. 13. The uncodified law of the State of Alaska is amended by adding a new section to 14 read: 15 REPORT TO LEGISLATURE. Annually, beginning in 2002 and ending in 2006, the 16 administrator of the teachers' retirement system shall report to the legislature by the 30th day 17 of the regular legislative session concerning the effect of this Act on the retirement system. 18 * Sec. 14. The uncodified law of the State of Alaska is amended by adding a new section to 19 read: 20 TRANSITION: REGULATIONS. (a) Notwithstanding sec. 17 of this Act, the 21 Alaska Teachers' Retirement Board may immediately proceed to adopt regulations necessary 22 to implement changes made by secs. 2, 4, and 6 of this Act. The regulations take effect under 23 AS 14.25.022, but not before July 1, 2001. 24 (b) Notwithstanding sec. 17 of this Act, the Public Employees' Retirement Board may 25 immediately proceed to adopt regulations necessary to implement changes made by secs. 7, 8, 26 10, and 11 of this Act. The regulations take effect under AS 39.35.042, but not before July 1, 27 2001. 28 * Sec. 15. Sections 3, 5, 9, and 12 of this Act take effect July 1, 2005. 29 * Sec. 16. Section 14 of this Act takes effect immediately under AS 01.10.070(c). 30 * Sec. 17. Except as provided in secs. 15 and 16 of this Act, this Act takes effect July 1, 31 2001.