CSHB 375(FIN) am: "An Act establishing the teachers' retirement system past service cost liability account in the Department of Revenue; establishing the public employees' retirement system past service cost liability account in the Department of Revenue; and providing for an effective date."
00 CS FOR HOUSE BILL NO. 375(FIN) am 01 "An Act establishing the teachers' retirement system past service cost liability account 02 in the Department of Revenue; establishing the public employees' retirement system 03 past service cost liability account in the Department of Revenue; and providing for an 04 effective date." 05 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF ALASKA: 06 * Section 1. AS 37.10 is amended by adding new sections to read: 07 Article 4A. Teachers' and Public Employees' Retirement System Past Service 08 Cost Liability Accounts. 09 Sec. 37.10.200. Teachers' retirement system past service cost 10 liability account. (a) There is established in the Department of Revenue the 11 teachers' retirement system past service cost liability account, consisting of 12 appropriations to the account. The commissioner of revenue shall develop and adopt 13 regulations necessary to accomplish the requirements of this section and shall manage 14 the account according to the requirements of AS 37.10.071.
01 (b) At the end of each fiscal year, after all distributions under (c) of 02 this section are completed, money appropriated for use in that fiscal year 03 reverts to the general fund and all income earned on the money shall be 04 paid to the general fund. 05 (c) During each fiscal year, the commissioner of revenue shall 06 distribute from the account established in (a) of this section, to each 07 employer other than the state that is a member of the Teachers' 08 Retirement System of Alaska, a payment that the employer shall pay to the 09 state for that fiscal year toward eliminating the employer's past service 10 cost liability to the Teachers' Retirement System of Alaska. 11 (d) A payment to an employer under (c) of this section must be 12 based on 85 percent of the payroll on which employer contributions to the 13 Teachers' Retirement System of Alaska were required and that the 14 employer reported to the Department of Administration for the fiscal year 15 preceding by three fiscal years the fiscal year for which a distribution is 16 made under this section, and the past service cost rate of the system for 17 the fiscal year preceding by three fiscal years the fiscal year for which a 18 distribution is made under this section. 19 (e) For any fiscal year that the money available for distribution 20 from the account is insufficient to pay every eligible employer the amount 21 due under this section, the amount distributed in that fiscal year to every 22 eligible employer shall be decreased pro rata. 23 (f) An employer who receives an overpayment in excess of a 24 distribution authorized by this section or in excess of the employer's past 25 service cost liability shall immediately return the overpayment to the 26 commissioner of revenue, who shall cause it to be returned to the account. 27 Sec. 37.10.202. Public employees' retirement system past 28 service cost liability account. (a) There is established in the Department of 29 Revenue the public employees' retirement system past service cost liability 30 account, consisting of appropriations to the account. The commissioner of revenue
01 shall develop and adopt regulations necessary to accomplish the requirements of this 02 section and shall manage the account according to the requirements of AS 37.10.071. 03 (b) At the end of each fiscal year, after all distributions under (c) 04 and (d) of this section are completed, money appropriated for use in that 05 fiscal year reverts to the general fund and all income earned on the money 06 shall be paid to the general fund. 07 (c) During each fiscal year, the commissioner of revenue shall 08 distribute from the account established in (a) of this section, to each 09 municipal employer or school district employer member of the Public 10 Employees' Retirement System of Alaska, a payment that the employer shall 11 pay to the state for that fiscal year toward eliminating the employer's past 12 service cost liability to the Public Employees' Retirement System of 13 Alaska. 14 (d) A payment to an employer under (c) of this section must be 15 based on the payroll on which employer contributions to the Public 16 Employees' Retirement System of Alaska were required and that the 17 employer reported to the Department of Administration for the fiscal year 18 preceding by three fiscal years the fiscal year for which a distribution is 19 made under (c) of this section and 85 percent of the employer's past service 20 cost rate during the fiscal year that precedes the distribution fiscal year 21 under (c) of this section by three fiscal years. 22 (e) In addition to the distribution under (c) of this section, an 23 employer that paid to the Public Employees' Retirement System of Alaska 24 in excess of the amount the employer was required to pay for the fiscal 25 year preceding by three fiscal years the fiscal year that a distribution is 26 made under this section shall receive, in unrestricted funds, an incentive 27 distribution from the account in an amount equal to 50 percent of the 28 excess. 29 (f) For any fiscal year that the money available for distribution from 30 the account is insufficient to pay every eligible employer the amount due
01 under this section, the amount distributed in that fiscal year to every 02 eligible employer shall be decreased pro rata. 03 (g) An employer who receives an overpayment in excess of a 04 distribution or incentive distribution authorized by this section shall 05 immediately return the overpayment to the commissioner of revenue, who 06 shall cause it to be returned to the account. 07 Sec. 37.10.204. Definitions. In AS 37.10.200 - AS 37.10.204, 08 (1) "average past service cost rate" means the average of the past 09 service cost rate of all employers as reported by the state's actuary for the fiscal year 10 preceding by three fiscal years the fiscal year for which a distribution is made under 11 AS 37.10.200 or AS 37.10.202; 12 (2) "past service cost rate" means the annual payment required to 13 eliminate an employer's unfunded liability over the amortization period, divided by the 14 payroll for which employer contributions are required and that is reported by the 15 employer to the Department of Administration for the fiscal year preceding by three 16 fiscal years the fiscal year that a distribution is made under AS 37.10.200 or 17 AS 37.10.202. 18 * Sec. 2. This Act takes effect July 1, 2006.