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Senate Study Bill 2180

Conference Committee Text

PAG LIN
  1  1                           DIVISION I
  1  2        IOWA PUBLIC EMPLOYEES' RETIREMENT SYSTEM (IPERS)
  1  3    Section 1.  Section 97B.4, unnumbered paragraph 1, Code
  1  4 1995, is amended to read as follows:
  1  5    The department, through the chief investment officer and
  1  6 chief benefits officer, shall administer this chapter.  The
  1  7 department may adopt, amend, or rescind rules, employ persons,
  1  8 execute contracts with outside parties, make expenditures,
  1  9 require reports, make investigations, and take other action it
  1 10 deems necessary for the administration of the system in
  1 11 conformity with the requirements of this chapter, the
  1 12 applicable provisions of the Internal Revenue Code, and all
  1 13 other applicable federal and state laws.  The rules shall be
  1 14 effective upon compliance with chapter 17A.  Not later than
  1 15 the fifteenth day of December of each year, the department
  1 16 shall submit to the governor a report covering the
  1 17 administration and operation of this chapter during the
  1 18 preceding fiscal year and shall make recommendations for
  1 19 amendments to this chapter.  The report shall include a
  1 20 balance sheet of the moneys in the Iowa public employees'
  1 21 retirement fund.
  1 22    Sec. 2.  Section 97B.7, subsection 2, paragraph b,
  1 23 unnumbered paragraphs 1 through 3, Code 1995, are amended to
  1 24 read as follows:
  1 25    To invest the portion of the retirement fund which in the
  1 26 judgment of the department is not needed for current payment
  1 27 of benefits under this chapter.  The department shall execute
  1 28 the disposition and investment of moneys in the retirement
  1 29 fund in accordance with the investment policy and goal
  1 30 statement established by the investment board.  In
  1 31 establishing the investment policy of the fund and the
  1 32 investment of the fund, the department and investment board
  1 33 shall exercise the judgment and care, under the circumstances
  1 34 then prevailing, which persons of prudence, discretion, and
  1 35 intelligence exercise in the management of their own affairs,
  2  1 not for the purpose of speculation, but with regard to the
  2  2 permanent disposition of the funds, considering the probable
  2  3 income, as well as the probable safety, of their capital.
  2  4 Within the limitations of the standard prescribed in this
  2  5 section, the treasurer of state, the department, and the board
  2  6 may acquire and retain every kind of property and every kind
  2  7 of investment which persons of prudence, discretion, and
  2  8 intelligence acquire or retain for their own account.
  2  9    The department and investment board shall give appropriate
  2 10 consideration to those facts and circumstances that the
  2 11 department and investment board know or should know are
  2 12 relevant to the particular investment or investment policy
  2 13 involved, including the role the investment plays in the total
  2 14 value of the retirement fund.
  2 15    For the purposes of this paragraph, appropriate con-
  2 16 sideration includes, but is not limited to, a determination by
  2 17 the department and investment board that the particular
  2 18 investment or investment policy is reasonably designed to
  2 19 further the purposes of the retirement system, taking into
  2 20 consideration the risk of loss and the opportunity for gain or
  2 21 other return associated with the investment or investment
  2 22 policy and consideration of the following factors as they
  2 23 relate to the retirement fund:
  2 24    Sec. 3.  Section 97B.11, Code 1995, is amended to read as
  2 25 follows:
  2 26    97B.11  CONTRIBUTIONS BY EMPLOYER AND EMPLOYEE.
  2 27    Each employer shall deduct from the wages of each member of
  2 28 the system a contribution in the amount of three and seven-
  2 29 tenths percent of the covered wages paid by the employer,
  2 30 until the member's termination or retirement from employment,
  2 31 whichever is earlier.  The contributions of the employer shall
  2 32 be in the amount of five and seventy-five hundredths percent
  2 33 of the covered wages of the member.
  2 34    If the total of the contributions to be deducted from the
  2 35 wages of a member and contributions picked up and paid by the
  3  1 employer shall not exceed one dollar for any calendar quarter,
  3  2 contributions shall not be deducted or paid concerning that
  3  3 member and the member shall not receive credit for membership
  3  4 service for that quarter.
  3  5    Sec. 4.  Section 97B.14, Code 1995, is amended to read as
  3  6 follows:
  3  7    97B.14  CONTRIBUTIONS FORWARDED.
  3  8    Contributions deducted from the wages of the member or
  3  9 under section 97B.11 prior to January 1, 1995, member
  3 10 contributions picked up by the employer under section 97B.11A
  3 11 beginning January 1, 1995, and the employer's contribution
  3 12 shall be forwarded to the department for recording and
  3 13 deposited with the treasurer of the state to the credit of the
  3 14 Iowa public employees' retirement fund.  Contributions shall
  3 15 be remitted monthly, if total contributions by both employee
  3 16 and employer amount to one hundred dollars or more each month,
  3 17 and shall be otherwise paid in such manner, at such times and
  3 18 under such conditions, either by copies of payrolls or other
  3 19 methods necessary or helpful in securing proper identification
  3 20 of the member, as may be prescribed by the department.
  3 21    Sec. 5.  Section 97B.15, Code 1995, is amended to read as
  3 22 follows:
  3 23    97B.15  RULES, POLICIES, AND PROCEDURES.
  3 24    The department may adopt rules under chapter 17A and
  3 25 establish procedures, not inconsistent with this chapter,
  3 26 which are necessary or appropriate to implement this chapter
  3 27 and shall adopt reasonable and proper rules to regulate and
  3 28 provide for the nature and extent of the proofs and evidence
  3 29 and the method of taking and furnishing the proofs and
  3 30 evidence in order to establish the right to benefits under
  3 31 this chapter.  The department may adopt rules, and take action
  3 32 based on the rules, to conform the requirements for receipt of
  3 33 retirement benefits under this chapter to the mandates of
  3 34 applicable federal statutes and regulations.
  3 35    Prior to the adoption of rules, the department may
  4  1 establish interim written policies and procedures, and take
  4  2 action based on the policies and procedures, to conform the
  4  3 requirements for receipt of retirement benefits under this
  4  4 chapter to the applicable requirements of federal law.
  4  5    Sec. 6.  Section 97B.17, unnumbered paragraph 1, Code 1995,
  4  6 is amended to read as follows:
  4  7    The department shall establish and maintain records of each
  4  8 member, including but not limited to, the amount of wages of
  4  9 each member, the contribution of each member with interest,
  4 10 and interest dividends credited.  The records may be
  4 11 maintained in paper, magnetic, or electronic form, including
  4 12 optical disk storage.  These records are the basis for the
  4 13 compilation of the retirement benefits provided under this
  4 14 chapter.  The following records maintained under this chapter
  4 15 containing personal identifiable information are not public
  4 16 records for the purposes of chapter 22:
  4 17    Sec. 7.  Section 97B.17, Code 1995, is amended by adding
  4 18 the following new unnumbered paragraph:
  4 19    NEW UNNUMBERED PARAGRAPH.  Notwithstanding any provisions
  4 20 of chapter 22 to the contrary, the department's records may be
  4 21 released to any political subdivision, instrumentality, or
  4 22 other agency of the state solely for use in a civil or
  4 23 criminal law enforcement activity pursuant to the requirements
  4 24 of this paragraph.  To obtain the records, the political
  4 25 subdivision, instrumentality, or agency shall, in writing,
  4 26 certify that the activity is authorized by law, provide a
  4 27 written description of the information desired, and describe
  4 28 the law enforcement activity for which the information is
  4 29 sought.  The department shall not be civilly or criminally
  4 30 liable for the release or rerelease of records in accordance
  4 31 with this paragraph.
  4 32    Sec. 8.  Section 97B.25, Code 1995, is amended to read as
  4 33 follows:
  4 34    97B.25  APPLICATIONS FOR BENEFITS.
  4 35    A representative designated by the chief benefits officer
  5  1 and referred to in this chapter as a retirement benefits
  5  2 specialist shall promptly examine applications for retirement
  5  3 benefits and on the basis of facts found shall determine
  5  4 whether or not the claim is valid and if valid, the month with
  5  5 respect to which benefits shall commence, the monthly benefit
  5  6 amount payable, and the maximum duration.  The retirement
  5  7 benefits specialist shall promptly notify the applicant and
  5  8 any other interested party of the decision and the reasons.
  5  9 Unless the applicant or other interested party, within thirty
  5 10 calendar days after the notification was mailed to the
  5 11 applicant's or party's last known address, files an appeal as
  5 12 provided in section 97B.20A, the decision is final and
  5 13 benefits shall be paid or denied in accord with the decision.
  5 14 A retirement application shall not be amended or revoked by
  5 15 the member once the first retirement allowance is paid.  A
  5 16 member's death during the first month of entitlement shall not
  5 17 invalidate an approved application.
  5 18    Sec. 9.  Section 97B.39, Code 1995, is amended to read as
  5 19 follows:
  5 20    97B.39  RIGHTS NOT TRANSFERABLE &endash; NOT OR SUBJECT TO LEGAL
  5 21 PROCESS &endash; EXCEPTIONS.
  5 22    The right of any person to any future payment under this
  5 23 chapter is not transferable or assignable, at law or in
  5 24 equity, and the moneys paid or payable or rights existing
  5 25 under this chapter are not subject to execution, levy,
  5 26 attachment, garnishment, or other legal process, or to the
  5 27 operation of any bankruptcy or insolvency law except for the
  5 28 purposes of enforcing child, spousal, or medical support
  5 29 obligations or marital property orders.  For the purposes of
  5 30 enforcing child, spousal, or medical support obligations or
  5 31 marital property orders, the garnishment or attachment of or
  5 32 the execution against compensation due a person under chapter
  5 33 97B this chapter shall not exceed the amount specified in 15
  5 34 U.S.C. } 1673(b).  A marital property order shall not require
  5 35 the payment of benefits to an alternate payee prior to the
  6  1 member's retirement or require the department or the member to
  6  2 designate a particular person as a designated beneficiary or
  6  3 contingent annuitant, or to select a particular benefit option
  6  4 on behalf of the member.  In addition, a marital property
  6  5 order shall not require payment of benefits to an alternate
  6  6 payee prior to the date the member elects to receive a refund
  6  7 of accumulated contributions pursuant to section 97B.53.
  6  8    Sec. 10.  Section 97B.41, subsection 2, Code Supplement
  6  9 1995, is amended to read as follows:
  6 10    2.  "Accumulated contributions" means the total obtained as
  6 11 of any date, by accumulating each individual contribution by
  6 12 the member at two percent with interest plus interest
  6 13 dividends as provided in section 97B.70, for all completed
  6 14 calendar years and for any completed calendar year for which
  6 15 the interest dividend has not been declared and for completed
  6 16 months of partially completed calendar years at two percent
  6 17 interest plus the interest dividend rate calculated for the
  6 18 previous year, compounded annually, from the end of the
  6 19 calendar year in which such contribution was made to the first
  6 20 day of the month of such date as provided in section 97B.70.
  6 21    Sec. 11.  Section 97B.41, subsection 8, paragraph b,
  6 22 subparagraph (6), Code Supplement 1995, is amended to read as
  6 23 follows:
  6 24    (6)  Employees hired for temporary employment of less than
  6 25 six months or one thousand and forty hours in a calendar year.
  6 26 An employee who works for an employer for six or more months
  6 27 in a calendar year or who works for an employer for more than
  6 28 one thousand forty hours in a calendar year is not a temporary
  6 29 employee under this subparagraph.  Adjunct instructors are
  6 30 temporary employees for the purposes of this chapter.  As used
  6 31 in this section, unless the context otherwise requires,
  6 32 "adjunct instructors" means instructors employed by a
  6 33 community college or a university governed by the state board
  6 34 of regents without a continuing contract, whose teaching load
  6 35 does not exceed one-half time for two full semesters or three
  7  1 full quarters per calendar year.
  7  2    Sec. 12.  Section 97B.41, subsection 8, paragraph b, Code
  7  3 Supplement 1995, is amended by adding the following new
  7  4 subparagraph:
  7  5    NEW SUBPARAGRAPH.  (20)  Persons employed through any
  7  6 program described in section 15.225, subsection 1, and
  7  7 provided by the Iowa conservation corps.
  7  8    Sec. 13.  Section 97B.41, Code Supplement 1995, is amended
  7  9 by adding the following new subsection:
  7 10    NEW SUBSECTION.  10A.  "Internal Revenue Code" means the
  7 11 Internal Revenue Code as defined in section 422.3.
  7 12    Sec. 14.  Section 97B.41, subsection 12, Code Supplement
  7 13 1995, is amended to read as follows:
  7 14    12.  "Membership service" means service rendered by a
  7 15 member after July 4, 1953.  Years of membership service shall
  7 16 be counted to the complete quarter calendar year.  However,
  7 17 membership service for a calendar year shall not include more
  7 18 than four quarters.  In determining a member's period of
  7 19 membership service, the department shall combine all periods
  7 20 of service for which the member has made contributions.  If
  7 21 the department has not maintained the accumulated contribution
  7 22 account of the member for a period of service, as provided
  7 23 pursuant to section 97B.53, subsection 6, the department shall
  7 24 credit the member for the service if the member submits
  7 25 satisfactory proof to the department that the member did make
  7 26 the contributions for the period of service and did not take a
  7 27 refund for the period of service.  However, the department
  7 28 shall not implement the amendments to this subsection, as
  7 29 enacted in 1994 Iowa Acts, chapter 1183, unless and until the
  7 30 department determines that the most recent annual actuarial
  7 31 valuation of the retirement system indicates that the employer
  7 32 and employee contribution rates in effect under section 97B.11
  7 33 can absorb the amendments to this subsection and to section
  7 34 97B.53, subsections 3 and 7, section 97B.53, subsection 6,
  7 35 unnumbered paragraph 1, and section 97B.70, by enacting a new
  8  1 subsection 4, contained in 1994 Iowa Acts, chapter 1183, after
  8  2 meeting the other established priorities of the system.  Until
  8  3 the amendments are implemented, the department shall continue
  8  4 to implement the provisions of section 97B.41, subsection 12,
  8  5 Code Supplement 1993.  As used in this subsection, unless the
  8  6 context otherwise requires, "other established priorities of
  8  7 the system" means that commencing January 1 following the most
  8  8 recent annual actuarial valuation of the system, the
  8  9 department has increased the covered wage limitation from the
  8 10 previous year by three thousand dollars, in accordance with
  8 11 section 97B.41, subsection 20, paragraph "b", subparagraph
  8 12 (11), and that the department has implemented the amendments
  8 13 to section 97B.66, unnumbered paragraphs 1 and 2, section
  8 14 97B.72, unnumbered paragraphs 1 and 2, section 97B.72A,
  8 15 subsection 1, unnumbered paragraph 1, section 97B.73A,
  8 16 unnumbered paragraph 1, and section 97B.74, unnumbered
  8 17 paragraphs 1 and 2, contained in 1994 Iowa Acts, chapter 1183.
  8 18    Sec. 15.  Section 97B.41, Code Supplement 1995, is amended
  8 19 by adding the following new subsection:
  8 20    NEW SUBSECTION.  13A.  "Regular service" means service for
  8 21 an employer other than special service.
  8 22    Sec. 16.  Section 97B.41, Code Supplement 1995, is amended
  8 23 by adding the following new subsection:
  8 24    NEW SUBSECTION.  14A.  "Retirement" means that period of
  8 25 time beginning when a member who has filed an approved
  8 26 application for a retirement allowance has survived into at
  8 27 least the first day of the member's first month of entitlement
  8 28 and ending when the member dies.
  8 29    Sec. 17.  Section 97B.41, subsection 15, paragraphs a and
  8 30 b, Code Supplement 1995, are amended to read as follows:
  8 31    a.  Service in the armed forces of the United States, if
  8 32 the employee was employed by the employer immediately prior to
  8 33 entry into the armed forces, and if the employee was released
  8 34 from service and returns to covered employment with the
  8 35 employer within twelve months of the date on which the
  9  1 employee has the right of release from service or within a
  9  2 longer period as provided required by the applicable laws of
  9  3 the United States.
  9  4    b.  Leave of absence or vacation authorized by the employer
  9  5 for a period not exceeding twelve months.  A leave of absence
  9  6 authorized pursuant to the requirements of the federal Family
  9  7 and Medical Leave Act of 1993 is considered a leave of absence
  9  8 authorized by the employer.
  9  9    Sec. 18.  Section 97B.41, Code Supplement 1995, is amended
  9 10 by adding the following new subsection:
  9 11    NEW SUBSECTION.  16A.  "Special service" means service for
  9 12 an employer while employed in a protection occupation as
  9 13 provided in section 97B.49, subsection 16, paragraph "a", and
  9 14 as a county sheriff, deputy sheriff, or airport fire fighter
  9 15 as provided in section 97B.49, subsection 16, paragraph "b".
  9 16    Sec. 19.  Section 97B.41, subsection 18, Code Supplement
  9 17 1995, is amended to read as follows:
  9 18    18.  a.  "Three-year average covered wage" means a member's
  9 19 covered wages averaged for the highest three years of the
  9 20 member's service, except as otherwise provided in this
  9 21 subsection.  The highest three years of a member's covered
  9 22 wages shall be determined using calendar years.  However, if a
  9 23 member's final quarter of a year of employment does not occur
  9 24 at the end of a calendar year, the department may determine
  9 25 the wages for the third year by computing the average quarter
  9 26 of all quarters from the member's highest calendar year of
  9 27 covered wages not being used in the selection of the two
  9 28 highest years and using the computed average quarter for each
  9 29 quarter in the third year in which no wages have been reported
  9 30 in combination with the final quarter or quarters of the
  9 31 member's service to create a full year.  However, the
  9 32 department shall not use the member's final quarter of wages
  9 33 if using that quarter would reduce the member's three-year
  9 34 average covered wage.  If the three-year average covered wage
  9 35 of a member exceeds the highest maximum covered wages in
 10  1 effect for a calendar year during the member's period of
 10  2 service, the three-year average covered wage of the member
 10  3 shall be reduced to the highest maximum covered wages in
 10  4 effect during the member's period of service.
 10  5    b.  Notwithstanding any other provisions of this subsection
 10  6 to the contrary, the three-year average covered wage shall be
 10  7 computed as follows for the following members:
 10  8    (1)  For a member who retires during the calendar year
 10  9 beginning January 1, 1997, and whose three-year average
 10 10 covered wage at the time of retirement exceeds forty-eight
 10 11 thousand dollars, the member's covered wages averaged for the
 10 12 highest four years of the member's service or forty-eight
 10 13 thousand dollars, whichever is greater.
 10 14    (2)  For a member who retires during the calendar year
 10 15 beginning January 1, 1998, and whose three-year average
 10 16 covered wage at the time of retirement exceeds fifty-two
 10 17 thousand dollars, the member's covered wages averaged for the
 10 18 highest five years of the member's service or fifty-two
 10 19 thousand dollars, whichever is greater.
 10 20    (3)  For a member who retires during the calendar year
 10 21 beginning January 1, 1999, and whose three-year average
 10 22 covered wage at the time of retirement exceeds fifty-five
 10 23 thousand dollars, the member's covered wages averaged for the
 10 24 highest six years of the member's service or fifty-five
 10 25 thousand dollars, whichever is greater.
 10 26    (4)  For a member who retires on or after January 1, 2000,
 10 27 but before January 1, 2003, and whose three-year average
 10 28 covered wage at the time of retirement exceeds fifty-five
 10 29 thousand dollars, the member's covered wages averaged for the
 10 30 highest seven years of the member's service or fifty-five
 10 31 thousand dollars, whichever is greater.
 10 32    For purposes of this paragraph, the highest years of the
 10 33 member's service shall be determined using calendar years and
 10 34 may be determined using one computed year calculated in the
 10 35 manner and subject to the restrictions provided in paragraph
 11  1 "a".
 11  2    Sec. 20.  Section 97B.41, subsection 20, paragraph b,
 11  3 subparagraph (11), unnumbered paragraphs 1 and 2, Code
 11  4 Supplement 1995, are amended by striking the unnumbered
 11  5 paragraphs and inserting in lieu thereof the following:
 11  6    (11)  For the calendar year beginning January 1, 1991,
 11  7 wages not in excess of thirty-one thousand dollars.
 11  8    (11A)  For the calendar year beginning January 1, 1992,
 11  9 wages not in excess of thirty-four thousand dollars.
 11 10    (11B)  For the calendar year beginning January 1, 1993,
 11 11 wages not in excess of thirty-five thousand dollars.
 11 12    (11C)  For the calendar year beginning January 1, 1994,
 11 13 wages not in excess of thirty-eight thousand dollars.
 11 14    (11D)  For the calendar year beginning January 1, 1995,
 11 15 wages not in excess of forty-one thousand dollars.
 11 16    (11E)  For the calendar year beginning January 1, 1996,
 11 17 wages not in excess of forty-four thousand dollars.
 11 18    (11F)  Commencing with the calendar year beginning January
 11 19 1, 1997, and for each subsequent calendar year, wages not in
 11 20 excess of the amount permitted for that year under section
 11 21 401(a)(17) of the Internal Revenue Code.
 11 22    Sec. 21.  Section 97B.41, subsection 20, paragraph b,
 11 23 subparagraph (11), unnumbered paragraph 3, Code Supplement
 11 24 1995, is amended to read as follows:
 11 25    Notwithstanding any other provision of this chapter
 11 26 providing for the payment of the benefits provided in section
 11 27 97B.49, subsection 16 or 17, the department shall establish
 11 28 the covered wages limitation which applies to members covered
 11 29 under section 97B.49, subsection 16 or 17, at the same level
 11 30 as is established under this subparagraph for other members of
 11 31 the system.
 11 32    Sec. 22.  Section 97B.42, unnumbered paragraph 1, Code
 11 33 1995, is amended to read as follows:
 11 34    Each employee whose employment commences after July 4,
 11 35 1953, or who has not qualified for credit for prior service
 12  1 rendered prior to July 4, 1953, or any publicly elected
 12  2 official of the state or any of its political subdivisions
 12  3 shall become a member upon the first day in which such
 12  4 employee is employed.  The employee shall continue to be an
 12  5 active member so long as the employee continues in covered
 12  6 employment.  The employee shall cease to be an active member
 12  7 if the employee joins another retirement system in the state
 12  8 which is maintained in whole or in part by public
 12  9 contributions or payments and receives retirement credit for
 12 10 service in that other system for the same position previously
 12 11 covered under this chapter.  If an employee joins another
 12 12 publicly maintained retirement system and ceases to be an
 12 13 active member under this chapter, the employee may elect to
 12 14 leave the employee's accumulated contributions in the
 12 15 retirement fund or receive a refund of the employee's
 12 16 accumulated contributions in the manner provided for members
 12 17 who are terminating covered employment pursuant to section
 12 18 97B.53.  However, if an employee joins another publicly
 12 19 maintained retirement system and leaves the employee's
 12 20 accumulated contributions in the retirement fund, the employee
 12 21 shall not be eligible to receive retirement benefits until the
 12 22 employee has a bona fide retirement from employment with a
 12 23 covered employer as provided in section 97B.52A, or until the
 12 24 employee would otherwise be eligible to receive benefits upon
 12 25 attaining the age of seventy years as provided in section
 12 26 97B.46.
 12 27    Sec. 23.  Section 97B.42, unnumbered paragraph 4, Code
 12 28 1995, is amended to read as follows:
 12 29    Persons who are members of any other retirement system in
 12 30 the state which is maintained in whole or in part by public
 12 31 contributions other than persons who are covered under the
 12 32 provisions of chapter 97, Code 1950, as amended by the Fifty-
 12 33 fourth General Assembly on the date of the repeal of said
 12 34 chapter, under the provisions of sections 97.50 through 97.53
 12 35 shall not become members under this chapter while still
 13  1 actively participating in that other retirement system unless
 13  2 the persons do not receive retirement credit for service in
 13  3 that other system for the position to be covered under this
 13  4 chapter.
 13  5    Sec. 24.  Section 97B.42, unnumbered paragraph 5, Code
 13  6 1995, is amended to read as follows:
 13  7    Nothing herein contained shall be construed to permit any
 13  8 person in public employment to be an active member of employer
 13  9 to make any public contributions or payments on behalf of an
 13 10 employee in the same position for the same period of time to
 13 11 both the Iowa public employees' retirement system and of any
 13 12 other retirement system in the state which is supported in
 13 13 whole or in part by public contributions or payments except as
 13 14 heretofore provided.
 13 15    Sec. 25.  Section 97B.45, unnumbered paragraph 2, Code
 13 16 1995, is amended to read as follows:
 13 17    A member may retire after the member's sixty-fifth birthday
 13 18 except as otherwise provided in section 97B.46.  A member
 13 19 retiring on or after the normal retirement date, as provided
 13 20 in section 97B.46, shall submit a written notice to the
 13 21 department setting forth the date the retirement is to become
 13 22 effective.  The date shall be after the member's last day of
 13 23 service and not before the first day of the sixth calendar
 13 24 month preceding the month in which the notice is filed.
 13 25    Sec. 26.  Section 97B.46, subsection 2, Code 1995, is
 13 26 amended by striking the subsection.
 13 27    Sec. 27.  Section 97B.48, subsection 1, Code 1995, is
 13 28 amended to read as follows:
 13 29    1.  Retirement allowances shall be paid monthly, except
 13 30 that an allowance of less than six hundred dollars a year may,
 13 31 at the member's option, be paid as a lump sum in an actuarial
 13 32 equivalent amount equal to the sum of the member's and
 13 33 employer's accumulated contributions and the retirement
 13 34 dividends standing to the member's credit before December 31,
 13 35 1966.  Receipt of the lump-sum payment by a member shall
 14  1 terminate any and all entitlement for the period of service
 14  2 covered of the member under this chapter.
 14  3    Sec. 28.  Section 97B.48A, subsection 1, Code 1995, is
 14  4 amended to read as follows:
 14  5    1.  If, after the first day of the month in which the
 14  6 member attains the age of fifty-five years and until the
 14  7 member's sixty-fifth birthday, a member who has not reached
 14  8 the member's sixty-fifth birthday and who has a bona fide
 14  9 retirement under this chapter is in regular full-time
 14 10 employment during a calendar year, the member's retirement
 14 11 allowance shall be suspended for as long as the member remains
 14 12 in employment for the remainder of that calendar year reduced
 14 13 by fifty cents for each dollar the member earns over the limit
 14 14 provided in this subsection.  However, effective January 1,
 14 15 1992, employment is not full-time employment until the member
 14 16 receives remuneration in an amount in excess of seven thousand
 14 17 four hundred forty dollars for a calendar year, or an amount
 14 18 equal to the amount of remuneration permitted for a calendar
 14 19 year for persons under sixty-five years of age before a
 14 20 reduction in federal Social Security retirement benefits is
 14 21 required, whichever is higher.  Effective the first of the
 14 22 month in which a member attains the age of sixty-five years, a
 14 23 retired member may receive a retirement allowance without a
 14 24 reduction after return to covered employment regardless of the
 14 25 amount of remuneration received.
 14 26    If a member dies and the full amount of the reduction from
 14 27 retirement allowances required under this subsection has not
 14 28 been paid, the remaining amounts shall be deducted from the
 14 29 payments made, if any, to the member's designated beneficiary
 14 30 or contingent annuitant.  If the member has selected an option
 14 31 under which remaining payments are not required or the
 14 32 remaining payments are insufficient to satisfy the full amount
 14 33 of the reduction from retirement allowances required under
 14 34 this subsection, the amount still unpaid shall be a claim
 14 35 against the member's estate.
 15  1    Sec. 29.  Section 97B.48A, subsection 4, Code 1995, is
 15  2 amended to read as follows:
 15  3    4.  The department shall pay to the member the accumulated
 15  4 contributions of the member and to the employer the employer
 15  5 contributions, plus two percent interest plus interest
 15  6 dividends as provided in section 97B.70, for all completed
 15  7 calendar years, compounded annually as provided in section
 15  8 97B.70, on the covered wages earned by a retired member that
 15  9 are not used in the recalculation of the retirement allowance
 15 10 of a member.
 15 11    Sec. 30.  Section 97B.49, subsection 4, Code Supplement
 15 12 1995, is amended by adding the following new unnumbered
 15 13 paragraph:
 15 14    NEW UNNUMBERED PARAGRAPH.  Effective January 1, 1997, for
 15 15 members who retired on or after July 1, 1953, and before July
 15 16 1, 1990, with at least ten years of membership service, the
 15 17 minimum monthly benefit payable at the normal retirement date
 15 18 for prior and membership service shall be two hundred dollars.
 15 19 The minimum monthly benefit payable shall be increased by ten
 15 20 dollars for each year of membership service beyond ten years,
 15 21 up to a maximum of twenty additional years of membership
 15 22 service.  If benefits commenced on an early retirement date,
 15 23 the amount of the benefit shall be reduced in accordance with
 15 24 section 97B.50.  If an optional allowance was selected under
 15 25 section 97B.51, the amount payable shall be the actuarial
 15 26 equivalent of the minimum benefit.
 15 27    Sec. 31.  Section 97B.49, subsection 5, paragraph b, Code
 15 28 Supplement 1995, is amended to read as follows:
 15 29    b.  For each active or inactive vested member retiring on
 15 30 or after July 1, 1990, with four or more complete years of
 15 31 service, a monthly benefit shall be computed which is equal to
 15 32 one-twelfth of an amount equal to fifty-two percent the
 15 33 applicable percentage multiplier of the three-year average
 15 34 covered wage multiplied by a fraction of years of service.
 15 35 The applicable percentage multiplier shall be the following:
 16  1    (1)  For active or inactive vested members retiring on or
 16  2 after July 1, 1990, but before July 1, 1991, fifty-two
 16  3 percent.
 16  4    (2)  For active or inactive vested members retiring on or
 16  5 after July 1, 1991, but before July 1, 1992, fifty-four
 16  6 percent.
 16  7    (3)  For active or inactive vested members retiring on or
 16  8 after July 1, 1992, but before July 1, 1993, fifty-six
 16  9 percent.
 16 10    (4)  For active or inactive vested members retiring on or
 16 11 after July 1, 1993, but before July 1, 1994, fifty-seven and
 16 12 four-tenths percent.
 16 13    (5)  For active or inactive vested members retiring on or
 16 14 after July 1, 1994, sixty percent.
 16 15    The applicable percentage multiplier shall be subject to
 16 16 adjustments as provided in paragraphs "e" and "f".
 16 17    Commencing July 1, 1991, the department shall increase the
 16 18 percentage multiplier of the three-year average covered wage
 16 19 by an additional two percent each July 1 until reaching sixty
 16 20 percent of the three-year average covered wage if the annual
 16 21 actuarial valuation of the retirement system indicates for
 16 22 that year that the cost of this increase in the percentage of
 16 23 the three-year average covered wage used in computing
 16 24 retirement benefits can be absorbed within the employer and
 16 25 employee contribution rates in effect under section 97B.11.
 16 26 However, commencing July 1, 1994, if the annual actuarial
 16 27 valuation of the retirement system indicates that the employer
 16 28 and employee contribution rates in effect under section 97B.11
 16 29 can absorb an increase in the percentage multiplier in excess
 16 30 of two percent, the department shall increase the percentage
 16 31 multiplier for that year beyond two percent to the extent
 16 32 which the increase can be absorbed by the contribution rates
 16 33 in effect, not to exceed a maximum percentage multiplier of
 16 34 sixty percent.  The increase in the percentage multiplier for
 16 35 a year applies only to the members retiring on or after July 1
 17  1 of the respective year.
 17  2    If the annual actuarial valuation of the retirement system
 17  3 in any year indicates that the full cost of the increase
 17  4 provided under this paragraph cannot be absorbed within the
 17  5 employer and employee contribution rates in effect under
 17  6 section 97B.11, the department shall reduce the increase to a
 17  7 level which the department determines can be so absorbed.
 17  8    Notwithstanding any other provision of this chapter
 17  9 providing for the payment of the benefits provided in
 17 10 subsection 16 or 17, the department shall establish apply the
 17 11 percentage multiplier which applies to members covered under
 17 12 subsection 16 or 17 at the same level as is established under
 17 13 this subsection for other members of the system, including any
 17 14 modification in the percentage multiplier as provided in
 17 15 paragraphs "e" and "f".
 17 16    By November 15, 1995, the department shall set aside from
 17 17 other moneys in the retirement fund three million eight
 17 18 hundred sixty thousand dollars.  The moneys set aside shall be
 17 19 from the funds generated by the employer and employee
 17 20 contributions in effect under section 97B.11 that exceed the
 17 21 amount necessary to fund the system's existing liabilities, as
 17 22 determined in the annual actuarial valuation of the system as
 17 23 of June 30, 1995.  If the annual actuarial valuation indicates
 17 24 that the amount of the employer and employee contributions in
 17 25 excess of the amount necessary to fund existing liabilities is
 17 26 less than three million eight hundred sixty thousand dollars,
 17 27 the department shall set aside all funds that are available.
 17 28 The funds set aside shall not be used in determining the
 17 29 covered wage limitation pursuant to section 97B.41, subsection
 17 30 20, paragraph "b", subparagraph (11), on January 1, 1996.
 17 31 However, any funds set aside which are not specifically
 17 32 dedicated to a purpose by the Seventy-sixth General Assembly
 17 33 shall be used in determining the covered wage limitation
 17 34 thereafter.
 17 35    In accordance with sections 97D.1 and 97D.4, it is the
 18  1 intent of the general assembly that once the goal of sixty
 18  2 percent of the three-year average covered wage is attained for
 18  3 a percentage multiplier, the department shall submit to the
 18  4 public retirement systems committee a plan for future benefit
 18  5 enhancements.  This plan shall include, but is not limited to,
 18  6 continuation in the increase in the covered wage ceiling until
 18  7 reaching fifty-five thousand dollars for a calendar year,
 18  8 providing for annual adjustments in the annual dividends paid
 18  9 to retired members as provided in section 97B.49, subsection
 18 10 13, and providing for the indexing of terminated vested
 18 11 members' earned benefits at a rate of three percent per year
 18 12 calculated from the date of termination from covered
 18 13 employment until the date of retirement.
 18 14    Sec. 32.  Section 97B.49, subsection 5, Code Supplement
 18 15 1995, is amended by adding the following new paragraph:
 18 16    NEW PARAGRAPH.  e.  For each active or inactive vested
 18 17 member retiring on or after July 1, 1996, the percentage
 18 18 multiplier of the three-year average covered wage used under
 18 19 subsections 5, 15, 16, and 17 to calculate the monthly
 18 20 retirement allowance shall be increased by one-fourth of one
 18 21 percentage point for each additional calendar quarter of
 18 22 membership service beyond the applicable years of service, not
 18 23 to exceed a total of six additional percentage points.  For
 18 24 purposes of this paragraph, "the applicable years of service"
 18 25 shall be the following, based upon the service retirement
 18 26 allowance selected:
 18 27    (1)  For members receiving a retirement allowance for
 18 28 regular service under subsection 5 or 15, or receiving a
 18 29 combined retirement allowance under subsection 17, the
 18 30 applicable years of service is thirty.
 18 31    (2)  For members receiving a retirement allowance for
 18 32 service in a protection occupation under subsection 16,
 18 33 paragraph "a", or receiving a retirement allowance for service
 18 34 as a sheriff, deputy sheriff, or airport fire fighter under
 18 35 subsection 16, paragraph "b", subparagraph (3), the applicable
 19  1 years of service is twenty-five.
 19  2    (3)  For members receiving a retirement allowance for
 19  3 service as a sheriff, deputy sheriff, or airport fire fighter
 19  4 under subsection 16, paragraph "b", subparagraph (1) or (2),
 19  5 the applicable years of service is twenty-two.
 19  6    Sec. 33.  Section 97B.49, subsection 5, Code Supplement
 19  7 1995, is amended by adding the following new paragraph:
 19  8    NEW PARAGRAPH.  f.  Notwithstanding any other provisions of
 19  9 this section to the contrary, for members retiring on or after
 19 10 July 1, 1997, and whose three-year average covered wage
 19 11 exceeds fifty-five thousand dollars, the monthly benefit shall
 19 12 be calculated by multiplying the sum of the following amounts
 19 13 by the fractions of years of service for that member.
 19 14    (1)  For the first fifty-five thousand dollars of the
 19 15 member's three-year average covered wage, one-twelfth of an
 19 16 amount equal to the applicable percentage multiplier otherwise
 19 17 provided in this subsection multiplied by fifty-five thousand
 19 18 dollars.
 19 19    (2)  For that portion of a member's three-year average
 19 20 covered wage that exceeds fifty-five thousand dollars but is
 19 21 less than or equal to sixty-five thousand dollars, one-twelfth
 19 22 of an amount equal to the applicable percentage multiplier
 19 23 otherwise provided in this subsection, reduced by ten
 19 24 percentage points, multiplied by that portion.
 19 25    (3)  For that portion of a member's three-year average
 19 26 covered wage that exceeds sixty-five thousand dollars but is
 19 27 less than or equal to seventy-five thousand dollars, one-
 19 28 twelfth of an amount equal to the applicable percentage
 19 29 multiplier otherwise provided in this subsection, reduced by
 19 30 fifteen percentage points, multiplied by that portion.
 19 31    (4)  For that portion of a member's three-year average
 19 32 covered wage that exceeds seventy-five thousand dollars but is
 19 33 less than or equal to eighty-five thousand dollars, one-
 19 34 twelfth of an amount equal to the applicable percentage
 19 35 multiplier otherwise provided in this subsection, reduced by
 20  1 twenty percentage points, multiplied by that portion.
 20  2    (5)  For that portion of a member's three-year average
 20  3 covered wage that exceeds eighty-five thousand dollars but is
 20  4 less than or equal to ninety-five thousand dollars, one-
 20  5 twelfth of an amount equal to the applicable percentage
 20  6 multiplier otherwise provided in this subsection, reduced by
 20  7 thirty percentage points, multiplied by that portion.
 20  8    (6)  For that portion of a member's three-year average
 20  9 covered wage that exceeds ninety-five thousand dollars, one-
 20 10 twelfth of an amount equal to the applicable percentage
 20 11 multiplier otherwise provided in this subsection, reduced by
 20 12 forty percentage points, multiplied by that portion.
 20 13    The covered wage categories referred to in subparagraphs
 20 14 (1) through (6) of this paragraph and the fifty-five thousand
 20 15 dollar amount otherwise specified in this paragraph shall be
 20 16 increased by the department for each calendar year, beginning
 20 17 January 1, 1998, by an amount that represents the percentage
 20 18 increase in the consumer price index during the previous
 20 19 calendar year, as published annually in the federal register
 20 20 by the federal department of labor, bureau of labor
 20 21 statistics.
 20 22    Sec. 34.  Section 97B.49, subsection 13, Code Supplement
 20 23 1995, is amended to read as follows:
 20 24    13.  a.  A member who retired from the system between
 20 25 January 1, 1976, and June 30, 1982, or a contingent annuitant
 20 26 or beneficiary of such a member, shall receive with the
 20 27 November 1994 and the November 1995 1996 monthly benefit
 20 28 payments payment a retirement dividend equal to one two
 20 29 hundred eighty-one twenty-three percent of the monthly benefit
 20 30 payment the member received for the preceding June, or the
 20 31 most recently received benefit payment, whichever is greater.
 20 32 The retirement dividend does not affect the amount of a
 20 33 monthly benefit payment.
 20 34    b.  Each member who retired from the system between July 4,
 20 35 1953, and December 31, 1975, or a contingent annuitant or
 21  1 beneficiary of such a member, shall receive with the November
 21  2 1994 and the November 1995 1996 monthly benefit payments
 21  3 payment a retirement dividend equal to two hundred thirty-six
 21  4 ninety-two percent of the monthly benefit payment the member
 21  5 received for the preceding June, or the most recently received
 21  6 benefit payment, whichever is greater.  The retirement
 21  7 dividend does not affect the amount of a monthly benefit
 21  8 payment.
 21  9    c.  Notwithstanding the determination of the amount of a
 21 10 retirement dividend under paragraph "a", "b", "d", or "f", or
 21 11 "g", a retirement dividend shall not be less than twenty-five
 21 12 dollars.
 21 13    d.  A member who retired from the system between July 1,
 21 14 1982, and June 30, 1986, or a contingent annuitant or
 21 15 beneficiary of such a member, shall receive with the November
 21 16 1994 and the November 1995 1996 monthly benefit payments
 21 17 payment a retirement dividend equal to forty-nine seventy-four
 21 18 percent of the monthly benefit payment the member received for
 21 19 the preceding June, or the most recently received benefit
 21 20 payment, whichever is greater.  The retirement dividend does
 21 21 not affect the amount of a monthly benefit payment.
 21 22    e.  If the member dies on or after July 1 of the dividend
 21 23 year but before the payment date, the full amount of the
 21 24 retirement dividend for that year shall be paid to the
 21 25 designated beneficiary to the member's account, upon
 21 26 notification of the member's death.  If there is no
 21 27 beneficiary designated by the member, the department shall pay
 21 28 the dividend to the member's estate.  The beneficiary, or the
 21 29 representative of the member's estate, must apply for the
 21 30 dividend within two years after the dividend is payable or the
 21 31 dividend is forfeited.
 21 32    f.  A member who retired from the system between July 1,
 21 33 1986, and June 30, 1990, or a contingent annuitant or
 21 34 beneficiary of such a member, shall receive with the November
 21 35 1996 and the November 1997 monthly benefit payments payment a
 22  1 retirement dividend in an amount determined by the general
 22  2 assembly equal to twenty-four percent of the monthly benefit
 22  3 payment the member received for the preceding June, or the
 22  4 most recently received benefit payment, whichever is greater.
 22  5 The retirement dividend does not affect the amount of a
 22  6 monthly benefit payment.
 22  7    Sec. 35.  Section 97B.49, subsection 13, Code Supplement
 22  8 1995, is amended by adding the following new paragraph:
 22  9    NEW PARAGRAPH.  g.  Effective July 1, 1997, commencing with
 22 10 dividends payable in November 1997, and for each subsequent
 22 11 year, all members who retired prior to July 1, 1990, shall be
 22 12 eligible for annual dividend payments, payable in November of
 22 13 that year, pursuant to the requirements of this paragraph.
 22 14 The dividend payable in any given year shall be the sum of the
 22 15 dollar amount of the dividend payable in the previous November
 22 16 and the dividend adjustment.
 22 17    The dividend adjustment for a given year shall be
 22 18 calculated by multiplying the total of the retiree's monthly
 22 19 benefit payments and the dividend payable to the retiree in
 22 20 the previous calendar year by the applicable percentage as
 22 21 determined by this paragraph.  The applicable percentage shall
 22 22 be the least of the following percentages:
 22 23    (1)  The percentage representing eighty percent of the
 22 24 percentage increase in the consumer price index published in
 22 25 the federal register by the federal department of labor,
 22 26 bureau of labor statistics, that reflects the percentage
 22 27 increase in the consumer price index for the twelve-month
 22 28 period ending June 30 of the year that the dividend is to be
 22 29 paid.
 22 30    (2)  The percentage representing the percentage amount the
 22 31 actuary has certified, in the annual actuarial valuation of
 22 32 the system as of June 30 of the year in which the dividend is
 22 33 to be paid, that the fund can absorb without requiring an
 22 34 increase in the employer and employee contributions to the
 22 35 fund.
 23  1    (3)  Three percent.
 23  2    The dividend determined pursuant to this paragraph shall
 23  3 not be used to increase the monthly benefit amount payable.
 23  4    Sec. 36.  Section 97B.49, subsection 15, paragraph b, Code
 23  5 Supplement 1995, is amended to read as follows:
 23  6    b.  For each active or inactive vested member retiring on
 23  7 or after July 1, 1990, and before July 1, 1996, who is at
 23  8 least fifty-five years of age and for which the sum of the
 23  9 number of years of membership service and prior service and
 23 10 the member's age in years as of the member's last birthday
 23 11 equals or exceeds ninety-two, a monthly benefit shall be
 23 12 computed which is equal to one-twelfth of the same percentage
 23 13 of the three-year average covered wage of the member as is
 23 14 provided in subsection 5.
 23 15    Sec. 37.  Section 97B.49, subsection 15, Code Supplement
 23 16 1995, is amended by adding the following new paragraph:
 23 17    NEW PARAGRAPH.  c.  For each active or inactive vested
 23 18 member retiring on or after July 1, 1996, who is at least
 23 19 fifty-five years of age and for which the sum of the number of
 23 20 years of membership service and prior service and the member's
 23 21 age in years as of the member's last birthday equals or
 23 22 exceeds eighty-eight, a monthly benefit shall be computed
 23 23 which is equal to one-twelfth of the same percentage of the
 23 24 three-year average covered wage of the member as is provided
 23 25 in subsection 5, multiplied by a fraction of years of service
 23 26 as is provided in subsection 5.
 23 27    Sec. 38.  Section 97B.49, subsection 16, paragraph b, Code
 23 28 Supplement 1995, is amended by adding the following new
 23 29 subparagraph:
 23 30    NEW SUBPARAGRAPH.  (3)  A member who retires from
 23 31 employment as a county sheriff, deputy sheriff, or airport
 23 32 fire fighter, who retires on or after July 1, 1996, and at the
 23 33 time of retirement has completed a total of twenty-five years
 23 34 of membership service with the last twelve years of membership
 23 35 service as a county sheriff, deputy sheriff, or airport fire
 24  1 fighter, may elect to receive in lieu of the receipt of any
 24  2 benefits under subsection 5 or 15, or subparagraphs (1) and
 24  3 (2) of this paragraph, a monthly retirement allowance equal to
 24  4 one-twelfth of the applicable percentage multiplier of the
 24  5 member's three-year average covered wage as is provided in
 24  6 paragraph "a", with benefits payable during the member's
 24  7 lifetime.
 24  8    Sec. 39.  Section 97B.49, subsection 16, paragraph d,
 24  9 subparagraph (9), Code Supplement 1995, is amended to read as
 24 10 follows:
 24 11    (9)  An employee of a judicial district department of
 24 12 correctional services who is employed as a probation officer
 24 13 II or III, or a parole officer II or III, or a residential
 24 14 counselor.
 24 15    Sec. 40.  Section 97B.49, subsection 16, paragraph e, Code
 24 16 Supplement 1995, is amended to read as follows:
 24 17    e.  Annually, the department of personnel shall actuarially
 24 18 determine the cost of the additional benefits provided for
 24 19 members covered under paragraph "a" and the cost of the
 24 20 additional benefits provided for members covered under
 24 21 paragraph "b" as percents of the covered wages of the
 24 22 employees covered by this subsection.  Sixty percent of the
 24 23 cost shall be paid by the employers of employees covered under
 24 24 this subsection and forty percent of the cost shall be paid by
 24 25 the employees.  The employer and employee contributions
 24 26 required under this paragraph are in addition to the
 24 27 contributions paid under section sections 97B.11 and 97B.11A.
 24 28    Sec. 41.  Section 97B.49, subsection 16, Code Supplement
 24 29 1995, is amended by adding the following new paragraph:
 24 30    NEW PARAGRAPH.  m.  For the fiscal year commencing July 1,
 24 31 1992, and each succeeding fiscal year, the department of
 24 32 public safety shall pay to the department of personnel from
 24 33 funds appropriated to the department of public safety, the
 24 34 amount necessary to pay the employer share of the cost of the
 24 35 additional benefits provided to a fire protection inspector
 25  1 peace officer pursuant to paragraph "d", subparagraph (8).
 25  2    Sec. 42.  Section 97B.49, Code Supplement 1995, is amended
 25  3 by adding the following new subsection:
 25  4    NEW SUBSECTION.  17.  a.  An active or inactive vested
 25  5 member, who is or has been employed in both special service
 25  6 and regular service, who retires on or after July 1, 1996,
 25  7 with four or more completed years of service and at the time
 25  8 of retirement is at least fifty-five years of age, may elect
 25  9 to receive, in lieu of the receipt of any other benefits under
 25 10 this section, a combined monthly retirement allowance equal to
 25 11 the sum of the following:
 25 12    (1)  One-twelfth of an amount equal to the applicable
 25 13 percentage multiplier established in subsection 5 of the
 25 14 member's three-year average covered wage multiplied by a
 25 15 fraction of years of service.  The fraction of years of
 25 16 service for purposes of this subparagraph shall be the actual
 25 17 years of service, not to exceed twenty-two, earned in a
 25 18 position described in subsection 16, paragraph "b", for which
 25 19 special service contributions were made, divided by twenty-
 25 20 two.
 25 21    (2)  One-twelfth of an amount equal to the applicable
 25 22 percentage multiplier established in subsection 5 of the
 25 23 member's three-year average covered wage multiplied by a
 25 24 fraction of years of service.  The fraction of years of
 25 25 service for purposes of this subparagraph shall be the actual
 25 26 years of service, not to exceed twenty-five, earned in a
 25 27 position described in subsection 16, paragraph "a", for which
 25 28 special service contributions were made, divided by twenty-
 25 29 five.
 25 30    (3)  One-twelfth of an amount equal to the applicable
 25 31 percentage multiplier established in subsection 5 of the
 25 32 member's three-year average covered wage multiplied by a
 25 33 fraction of years of service.  The fraction of years of
 25 34 service for purposes of this subparagraph shall be the actual
 25 35 years of service, not to exceed thirty, for which regular
 26  1 service contributions were made, divided by thirty.  However,
 26  2 any otherwise applicable age reduction for early retirement
 26  3 shall apply to the calculation under this subparagraph.
 26  4    In calculating the fractions of years of service under
 26  5 subparagraphs (1) and (2), a member shall not receive special
 26  6 service credit for years of service for which the member and
 26  7 the member's employer did not make the required special
 26  8 service contributions to the department.
 26  9    b.  In calculating the combined monthly retirement
 26 10 allowance pursuant to paragraph "a", the sum of the fraction
 26 11 of years of service provided in paragraph "a", subparagraphs
 26 12 (1), (2), and (3), shall not exceed one.  If the sum of the
 26 13 fractions of years of service would exceed one, the department
 26 14 shall deduct years of service first from the calculation under
 26 15 paragraph "a", subparagraph (3), and then from the calculation
 26 16 under paragraph "a", subparagraph (2), if necessary, so that
 26 17 the sum of the fractions of years of service shall equal one.
 26 18    c.  (1)  In calculating the combined monthly retirement
 26 19 allowance pursuant to paragraph "a", and in determining the
 26 20 applicable percentage multiplier established in subsection 5,
 26 21 the member shall be entitled to an addition in the percentage
 26 22 multiplier in accordance with subsection 5, paragraph "e",
 26 23 only for those years of service in excess of thirty years.
 26 24 Any addition in the percentage multiplier shall be included in
 26 25 the calculations required under paragraph "a", subparagraphs
 26 26 (1), (2), and (3) of this subsection.
 26 27    (2)  In calculating the combined monthly retirement
 26 28 allowance pursuant to paragraph "a", for members retiring on
 26 29 or after July 1, 1997, whose three-year average covered wage
 26 30 exceeds fifty-five thousand dollars, each calculation under
 26 31 paragraph "a", subparagraphs (1), (2), and (3) of this
 26 32 subsection shall be subject to reduction, calculated in the
 26 33 manner provided in subsection 5, paragraph "f".
 26 34    Sec. 43.  Section 97B.50, subsection 2, Code 1995, is
 26 35 amended to read as follows:
 27  1    2.  a.  A vested member who retires from the system due to
 27  2 disability and commences receiving disability benefits
 27  3 pursuant to the federal Social Security Act, 42 U.S.C. } 423
 27  4 et seq., and who has not reached the normal retirement date,
 27  5 shall receive benefits under section 97B.49 and shall not have
 27  6 benefits reduced upon retirement as required under subsection
 27  7 1 regardless of whether the member has completed thirty or
 27  8 more years of membership service.  However, the benefits shall
 27  9 be suspended during any period in which the member returns to
 27 10 covered employment.  This section takes effect July 1, 1990,
 27 11 for a member meeting the requirements of this paragraph who
 27 12 retired from the system at any time after July 4, 1953.
 27 13 Eligible members are entitled to the receipt of retroactive
 27 14 adjustment payments back to July 1, 1990, notwithstanding the
 27 15 requirements of subsection 4.
 27 16    b.  A vested member who retires from the system due to
 27 17 disability and commences receiving disability benefits
 27 18 pursuant to the federal Railroad Retirement Act, 45 U.S.C. }
 27 19 231 et seq., and who has not reached the normal retirement
 27 20 date, shall receive benefits under section 97B.49 and shall
 27 21 not have benefits reduced upon retirement as required under
 27 22 subsection 1 regardless of whether the member has completed
 27 23 thirty or more years of membership service.  However, the
 27 24 benefits shall be suspended during any period in which the
 27 25 member returns to covered employment.  This section takes
 27 26 effect July 1, 1990, for a member meeting the requirements of
 27 27 this paragraph who retired from the system at any time since
 27 28 July 4, 1953.  Eligible members are entitled to the receipt of
 27 29 retroactive adjustment payments back to July 1, 1990,
 27 30 notwithstanding the requirements of subsection 4.
 27 31    Sec. 44.  NEW SECTION.  97B.50A  ACCIDENTAL DISABILITY
 27 32 BENEFITS FOR SHERIFFS, DEPUTY SHERIFFS, AIRPORT FIRE FIGHTERS,
 27 33 AND MEMBERS OF A PROTECTION OCCUPATION.
 27 34    1.  DEFINITIONS.  For purposes of this section, unless the
 27 35 context otherwise provides, "member" means a vested member who
 28  1 is classified as a sheriff, deputy sheriff, or airport fire
 28  2 fighter or as a vested member of a protection occupation under
 28  3 section 97B.49, subsection 16, at the time of the alleged
 28  4 disability.
 28  5    2.  ACCIDENTAL DISABILITY RETIREMENT ALLOWANCE.
 28  6    a.  Effective January 1, 1997, a member who is injured in
 28  7 the performance of the member's duties, and otherwise meets
 28  8 the requirements of this section shall receive an accidental
 28  9 disability retirement allowance under the provisions of this
 28 10 section, in lieu of a monthly retirement allowance as provided
 28 11 in section 97B.49 or benefits calculated as provided in
 28 12 section 97B.50, subsection 2.
 28 13    b.  Upon application of a member, a member who has become
 28 14 totally and permanently incapacitated for duty as the natural
 28 15 and proximate result of an injury, disease, or exposure
 28 16 occurring or aggravated while in the actual performance of
 28 17 duty shall be retired by the department, provided that the
 28 18 medical board shall certify that the member is mentally or
 28 19 physically incapacitated for further performance of duty, that
 28 20 the incapacity is likely to be permanent, and that the member
 28 21 should be retired.  The department shall make the final
 28 22 determination, based on the medical evidence received, of a
 28 23 member's total and permanent disability.  However, if a
 28 24 person's membership in the system first commenced on or after
 28 25 January 1, 1997, the member shall not be eligible for benefits
 28 26 with respect to a disability which would not exist, but for a
 28 27 medical condition that was known to exist on the date that
 28 28 membership commenced.
 28 29    c.  Disease under this section shall mean heart disease or
 28 30 any disease of the lungs or respiratory tract and shall be
 28 31 presumed to have been contracted while on active duty as a
 28 32 result of strain, exposure, or the inhalation of noxious
 28 33 fumes, poison, or gases.  However, if a person's membership in
 28 34 the system first commenced on or after January 1, 1997, and
 28 35 the heart disease or disease of the lungs or respiratory tract
 29  1 would not exist, but for a medical condition that was known to
 29  2 exist on the date that membership commenced, the presumption
 29  3 established in this paragraph shall not apply.
 29  4    d.  Any amounts which may be paid or payable by the
 29  5 employer under the provisions of any workers' compensation or
 29  6 other law to a member, or to the dependents of a member on
 29  7 account of any disability, shall not be offset against and
 29  8 payable in lieu of any retirement allowance payable pursuant
 29  9 to this section on account of the same disability.
 29 10    3.  RETIREMENT AFTER ACCIDENT.
 29 11    Upon retirement for an accidental disability as provided by
 29 12 this section, a member shall receive the greater of a monthly
 29 13 accidental disability retirement allowance calculated under
 29 14 this section or a disability retirement allowance calculated
 29 15 under section 97B.50, subsection 2.  The monthly accidental
 29 16 disability allowance calculated under this section shall
 29 17 consist of an allowance equal to one-twelfth of thirty-three
 29 18 and one-third percent of the member's three-year average
 29 19 covered wage at the time of disability.
 29 20    4.  REEXAMINATION &endash; REEMPLOYMENT OF MEMBERS RETIRED ON
 29 21 ACCOUNT OF AN ACCIDENTAL DISABILITY.
 29 22    a.  Once each year during the first five years following
 29 23 the retirement of a member under this section, and once in
 29 24 every three-year period thereafter, the department may, and
 29 25 upon the member's application shall, require any member
 29 26 receiving an accidental disability retirement allowance who
 29 27 has not yet attained the age of fifty-five years to undergo a
 29 28 medical examination as arranged by the medical board.  The
 29 29 examination shall be made by the medical board or by an
 29 30 additional physician or physicians designated by the board.
 29 31 If any member receiving an accidental disability retirement
 29 32 allowance who has not attained the age of fifty-five years
 29 33 refuses to submit to the medical examination, the allowance
 29 34 may be discontinued until the member's withdrawal of the
 29 35 refusal, and should the member's refusal continue for one
 30  1 year, all rights in and to the member's disability retirement
 30  2 allowance shall be revoked by the department.
 30  3    b.  If a member receiving a disability retirement allowance
 30  4 is returned to covered employment, the member's disability
 30  5 retirement allowance shall cease, the member shall again
 30  6 become an active member, and shall contribute thereafter at
 30  7 the same rate payable by similarly classified members.  Upon
 30  8 subsequent retirement, the member's retirement allowance shall
 30  9 be calculated as provided in section 97B.48A.
 30 10    5.  DEATH BENEFITS.  A member who is receiving an
 30 11 accidental disability retirement allowance under this section
 30 12 shall be treated as having elected a lifetime monthly
 30 13 retirement allowance with no death benefit unless the member
 30 14 elects an optional form of benefit provided under section
 30 15 97B.51, which shall be actuarially equivalent to the lifetime
 30 16 monthly retirement allowance provided under subsection 3.
 30 17    6.  MEDICAL BOARD.  The system shall designate a medical
 30 18 board to be composed of three physicians who shall arrange for
 30 19 and pass upon the medical examinations required under the
 30 20 provisions of this section and shall report in writing to the
 30 21 department the conclusions and recommendations upon all
 30 22 matters duly referred to the medical board.  Each report of a
 30 23 medical examination under this section shall include the
 30 24 medical board's findings as to the extent of the member's
 30 25 physical impairment.
 30 26    7.  RULES.  The department shall adopt rules pursuant to
 30 27 chapter 17A specifying the application procedure for members
 30 28 pursuant to this section.
 30 29    Sec. 45.  Section 97B.51, subsection 3, Code Supplement
 30 30 1995, is amended to read as follows:
 30 31    3.  A member who had elected to take the option stated in
 30 32 subsection 1 of this section may, at any time prior to
 30 33 retirement, revoke such an election by written notice to the
 30 34 department.  A member shall not change or revoke an election
 30 35 once the first retirement allowance is paid.
 31  1    Sec. 46.  Section 97B.51, subsection 5, Code Supplement
 31  2 1995, is amended to read as follows:
 31  3    5.  At retirement, a member may designate that upon the
 31  4 member's death, a specified amount of money shall be paid to a
 31  5 named beneficiary, and the member's monthly retirement
 31  6 allowance shall be reduced by an actuarially determined amount
 31  7 to provide for the lump sum payment.  The amount designated by
 31  8 the member must be in thousand dollar increments, and the and
 31  9 shall be limited to the amount of the member's accumulated
 31 10 contributions.  The amount designated shall not lower the
 31 11 monthly retirement allowance of the member by more than one-
 31 12 half the amount payable under section 97B.49, subsection 1 or
 31 13 5.  A member may designate a different beneficiary if the
 31 14 original named beneficiary predeceases the member.
 31 15    Sec. 47.  Section 97B.51, subsection 6, Code Supplement
 31 16 1995, is amended to read as follows:
 31 17    6.  A member may elect to receive a decreased retirement
 31 18 allowance during the member's lifetime with provision that in
 31 19 event of the member's death during the first one hundred
 31 20 twenty months of retirement, monthly payments of the member's
 31 21 decreased retirement allowance shall be made to the member's
 31 22 beneficiary until a combined total of one hundred twenty
 31 23 monthly payments have been made to the member and the member's
 31 24 beneficiary.  When the member designates multiple
 31 25 beneficiaries, the present value of the remaining payments
 31 26 shall be paid in a lump sum to each beneficiary, either in
 31 27 equal shares to the beneficiaries, or if the member specifies
 31 28 otherwise in a written request, in the specified proportion.
 31 29 A member may designate a different beneficiary if the original
 31 30 named beneficiary predeceases the member.
 31 31    Sec. 48.  Section 97B.52, subsection 1, Code Supplement
 31 32 1995, is amended to read as follows:
 31 33    1.  If a member dies prior to the member's first month of
 31 34 entitlement, the accumulated contributions of the member at
 31 35 the date of death plus the product of an amount equal to the
 32  1 highest year of covered wages of the deceased member and the
 32  2 number of years of membership service divided by thirty the
 32  3 applicable denominator shall be paid to the member's
 32  4 beneficiary in a lump sum payment.  However, a lump sum
 32  5 payment made to a beneficiary under this subsection due to the
 32  6 death of a member shall not be less than the amount that would
 32  7 have been payable on the death of the member on June 30, 1984,
 32  8 under this subsection as it appeared in the 1983 Code.
 32  9    As used in this subsection, "applicable denominator" means
 32 10 the following, based upon the type of membership service in
 32 11 which the member served either on the date of death, or if the
 32 12 member died after terminating service, on the date of the
 32 13 member's last termination of service:
 32 14    a.  For regular service, the applicable denominator is
 32 15 thirty.
 32 16    b.  For service in a protection occupation, as defined in
 32 17 section 97B.49, subsection 16, paragraph "d", the applicable
 32 18 denominator is twenty-five.
 32 19    c.  For service as a sheriff, deputy sheriff, or airport
 32 20 fire fighter, as provided in section 97B.49, subsection 16,
 32 21 paragraph "b", the applicable denominator is twenty-two.
 32 22    Effective July 1, 1978, a method of payment under this
 32 23 subsection filed with the department by a member does not
 32 24 apply.
 32 25    Sec. 49.  Section 97B.52, subsection 3, paragraph b, Code
 32 26 Supplement 1995, is amended to read as follows:
 32 27    b.  If a death benefit is due and payable, interest shall
 32 28 continue to accumulate through the month preceding the month
 32 29 in which payment is made to the designated beneficiary, heirs
 32 30 at law, or the estate unless the payment of the death benefit
 32 31 is delayed because of a dispute between alleged heirs, in
 32 32 which case the benefit due and payable shall be placed in a
 32 33 noninterest bearing escrow account until the beneficiary is
 32 34 determined in accordance with this section.  In order to
 32 35 receive the death benefit, the beneficiary, heirs at law, or
 33  1 the estate, or any other third-party payee, must apply to the
 33  2 department within two five years of the member's death.
 33  3    The department shall reinstate a designated beneficiary's
 33  4 right to receive a death benefit beyond the five-year
 33  5 limitation if the designated beneficiary was the member's
 33  6 spouse at the time of the member's death and the distribution
 33  7 is required or permitted pursuant to Internal Revenue Code
 33  8 section 401(a)(9) and the applicable treasury regulations.
 33  9    Sec. 50.  Section 97B.52, subsection 5, Code Supplement
 33 10 1995, is amended to read as follows:
 33 11    5.  Following written notification to the department, a
 33 12 beneficiary of a deceased member may waive current and future
 33 13 rights to payments to which the beneficiary would otherwise be
 33 14 entitled under sections 97B.51 and this section.  Upon receipt
 33 15 of the waiver, the department shall pay to the estate of the
 33 16 deceased member the amount designated to be received by the
 33 17 that beneficiary to the member's other surviving beneficiary
 33 18 or beneficiaries or to the estate of the deceased member, as
 33 19 elected by the beneficiary in the waiver.  If the payments
 33 20 being waived are payable to the member's estate and an estate
 33 21 is not probated, the payments shall be paid to the deceased
 33 22 member's surviving spouse, or if there is no surviving spouse,
 33 23 to the member's heirs other than the beneficiary who waived
 33 24 the payments.
 33 25    Sec. 51.  Section 97B.52A, Code Supplement 1995, is amended
 33 26 by adding the following new subsection:
 33 27    NEW SUBSECTION.  3.  A member who terminates covered
 33 28 employment but maintains an employment relationship with an
 33 29 employer that made contributions to the system on the member's
 33 30 behalf does not have a bona fide retirement until all
 33 31 employment, including employment which is not covered by this
 33 32 chapter, with such employer is terminated for at least thirty
 33 33 days.  In order to receive retirement benefits, the member
 33 34 must file a completed application for benefits form with the
 33 35 department before returning to any employment with the same
 34  1 employer.
 34  2    Sec. 52.  Section 97B.53, subsection 3, Code Supplement
 34  3 1995, is amended to read as follows:
 34  4    3.  The accumulated contributions of a terminated, vested
 34  5 member shall be credited with interest, including interest
 34  6 dividends, in the manner provided in section 97B.70.  Interest
 34  7 and interest dividends shall be credited to the accumulated
 34  8 contributions of members who terminate service and
 34  9 subsequently become vested in accordance with section 97B.70.
 34 10 However, the department shall not implement the amendments to
 34 11 this subsection or to subsection 6, unnumbered paragraph 1, or
 34 12 to subsection 7, as enacted in 1994 Iowa Acts, chapter 1183,
 34 13 unless and until the department determines that the most
 34 14 recent annual actuarial valuation of the retirement system
 34 15 indicates that the employer and employee contribution rates in
 34 16 effect under section 97B.11 can absorb the amendments to these
 34 17 provisions of this section and the amendments to section
 34 18 97B.41, subsection 12, and section 97B.70, by enacting a new
 34 19 subsection 4, contained in 1994 Iowa Acts, chapter 1183, after
 34 20 meeting the other established priorities of the system, as
 34 21 defined in section 97B.41, subsection 12.  Until the
 34 22 amendments are implemented, the department shall continue to
 34 23 implement the provisions of section 97B.53, subsections 3 and
 34 24 7, and section 97B.53, subsection 6, unnumbered paragraph 1,
 34 25 1993 Code of Iowa.
 34 26    Sec. 53.  Section 97B.53B, subsection 1, paragraph c,
 34 27 subparagraph (4), Code 1995, is amended to read as follows:
 34 28    (4)  A distribution Annual distributions of less than two
 34 29 hundred dollars of taxable income.
 34 30    Sec. 54.  Section 97B.66, unnumbered paragraph 1, Code
 34 31 Supplement 1995, is amended to read as follows:
 34 32    A vested or retired member who was a member of the teachers
 34 33 insurance and annuity association-college retirement equity
 34 34 fund at any time between July 1, 1967 and June 30, 1971 and
 34 35 who became a member of the system on July 1, 1971, upon
 35  1 submitting verification of service and wages earned during the
 35  2 applicable period of service under the teachers insurance and
 35  3 annuity association-college retirement equity fund, may make
 35  4 employer and employee contributions to the system based upon
 35  5 the covered wages of the member and the covered wages and the
 35  6 contribution rates in effect for all or a portion of that
 35  7 period of service and receive credit for membership service
 35  8 under this system equivalent to the applicable period of
 35  9 membership service in the teachers insurance and annuity
 35 10 association-college retirement equity fund for which the
 35 11 contributions have been made.  In addition, a member making
 35 12 employer and employee contributions because of membership in
 35 13 the teachers insurance and annuity association-college
 35 14 retirement equity fund under this section who was a member of
 35 15 the system on June 30, 1967 and withdrew the member's
 35 16 accumulated contributions because of membership on July 1,
 35 17 1967 in the teachers insurance and annuity association-college
 35 18 retirement equity fund, may make employee contributions to the
 35 19 system for all or a portion of the period of service under the
 35 20 system prior to July 1, 1967.  A member making contributions
 35 21 pursuant to this section may make the contributions either for
 35 22 the entire applicable period of service, or, effective upon
 35 23 the date that the department determines that the amendments to
 35 24 this paragraph and unnumbered paragraph 2 contained in 1994
 35 25 Iowa Acts, chapter 1183, shall be implemented, for portions of
 35 26 the period of service, and if contributions are made for
 35 27 portions of the period of service, the contributions shall be
 35 28 in increments of one or more years, as long as the increments
 35 29 represent full years and not a portion of a year calendar
 35 30 quarters.  However, the department shall not implement the
 35 31 amendments to this paragraph or unnumbered paragraph 2, as
 35 32 enacted in 1994 Iowa Acts, chapter 1183, unless and until the
 35 33 department determines that the most recent annual actuarial
 35 34 valuation of the retirement system indicates that the employer
 35 35 and employee contribution rates in effect under section 97B.11
 36  1 can absorb the amendments to this paragraph and unnumbered
 36  2 paragraph 2 and to section 97B.72, unnumbered paragraphs 1 and
 36  3 2, section 97B.72A, subsection 1, unnumbered paragraph 1,
 36  4 section 97B.73A, unnumbered paragraph 1, and section 97B.74,
 36  5 unnumbered paragraphs 1 and 2, contained in 1994 Iowa Acts,
 36  6 chapter 1183, after meeting the other established priority of
 36  7 the system.  Until the amendments are implemented, the
 36  8 department shall continue to implement the provisions of
 36  9 section 97B.66, unnumbered paragraphs 1 and 2, Code Supplement
 36 10 1993.  As used in this section, unless the context otherwise
 36 11 requires, "other established priority of the system" means
 36 12 that commencing January 1 following the most recent annual
 36 13 actuarial valuation of the system, the department has
 36 14 increased the covered wage limitation from the previous year
 36 15 by three thousand dollars, in accordance with section 97B.41,
 36 16 subsection 20, paragraph "b", subparagraph (11).
 36 17    Sec. 55.  Section 97B.66, unnumbered paragraph 2, Code
 36 18 Supplement 1995, is amended to read as follows:
 36 19    The contributions paid by the vested or retired member
 36 20 shall be equal to the accumulated contributions as defined in
 36 21 section 97B.41, subsection 2, by the member for the applicable
 36 22 period of service, and the employer contribution for the
 36 23 applicable period of service under the teachers insurance and
 36 24 annuity association-college retirement equity fund, that would
 36 25 have been or had been contributed by the vested or retired
 36 26 member and the employer, if applicable, plus interest on the
 36 27 contributions that would have accrued for the applicable
 36 28 period from the date the previous applicable period of service
 36 29 commenced under this system or from the date the service of
 36 30 the member in the teachers insurance and annuity association-
 36 31 college retirement equity fund commenced to the date of
 36 32 payment of the contributions by the member equal to two
 36 33 percent plus the interest dividend rate applicable for each
 36 34 year as provided in section 97B.70.
 36 35    Sec. 56.  Section 97B.68, subsection 1, Code 1995, is
 37  1 amended to read as follows:
 37  2    1.  Effective July 1, 1988 1996, a person who is a member
 37  3 of the federal civil service retirement program or the federal
 37  4 employee's retirement system is not eligible for membership in
 37  5 the Iowa public employees' retirement system for the same
 37  6 position, and this chapter does not apply to that employee.
 37  7 An employee whose membership in the federal civil service
 37  8 retirement program or the federal employee's retirement system
 37  9 is subsequently terminated shall immediately notify the
 37 10 employee's employer and the department of personnel of that
 37 11 fact, and the employee shall become subject to this chapter on
 37 12 the date the notification is received by the department.
 37 13    Sec. 57.  Section 97B.68, Code 1995, is amended by adding
 37 14 the following new subsection:
 37 15    NEW SUBSECTION.  3.  Effective July 1, 1996, an employee
 37 16 who participates in the federal civil service retirement
 37 17 program or the federal employee's retirement system may be
 37 18 covered under this chapter if otherwise eligible.  The
 37 19 employee shall not be covered under this chapter, however,
 37 20 unless the employee is not credited for service in the federal
 37 21 civil service retirement system or the federal employee's
 37 22 retirement system for the position to be covered under this
 37 23 chapter.  This subsection shall not be construed to permit any
 37 24 employer to contribute on behalf of an employee for the same
 37 25 position for and the same period of service to both the Iowa
 37 26 public employees' retirement system and either the federal
 37 27 civil service retirement program or the federal employee's
 37 28 retirement system.
 37 29    Sec. 58.  Section 97B.70, Code Supplement 1995, is amended
 37 30 to read as follows:
 37 31    97B.70  INTEREST AND DIVIDENDS TO MEMBERS.
 37 32    1.  Interest For calendar years prior to January 1, 1997,
 37 33 interest at two percent per annum and interest dividends
 37 34 declared by the department shall be credited to the member's
 37 35 contributions and the employer's contributions to become part
 38  1 of the accumulated contributions thereby.
 38  2    1. a.  The average rate of interest earned shall be
 38  3 determined upon the following basis:
 38  4    a. (1)  Investment income shall include interest and cash
 38  5 dividends on stock.
 38  6    b. (2)  Investment income shall be accounted for on an
 38  7 accrual basis.
 38  8    c. (3)  Capital gains and losses, realized or unrealized,
 38  9 shall not be included in investment income.
 38 10    d. (4)  Mean assets shall include fixed income investments
 38 11 valued at cost or on an amortized basis, and common stocks at
 38 12 market values or cost, whichever is lower.
 38 13    e. (5)  The average rate of earned interest shall be the
 38 14 quotient of the investment income and the mean assets of the
 38 15 retirement fund.
 38 16    2. b.  The interest dividend shall be determined within
 38 17 sixty days after the end of each calendar year as follows:
 38 18    The dividend rate for a calendar year shall be the excess
 38 19 of the average rate of interest earned for the year over the
 38 20 statutory two percent rate plus twenty-five hundredths of one
 38 21 percent.  The average rate of interest earned and the interest
 38 22 dividend rate in percent shall be calculated to the nearest
 38 23 one hundredth, that is, to two decimal places.  Interest and
 38 24 interest dividends calculated pursuant to this subsection
 38 25 shall be compounded annually.
 38 26    2.  For calendar years beginning January 1, 1997, a per
 38 27 annum interest rate at one percent above the interest rate on
 38 28 one-year certificates of deposit shall be credited to the
 38 29 member's contributions and the employer's contributions to
 38 30 become part of the accumulated contributions.  For purposes of
 38 31 this subsection, the interest rate on one-year certificates of
 38 32 deposit shall be determined by the department based on the
 38 33 average rate for such certificates of deposit as of January 10
 38 34 of each year as published in a publication of general
 38 35 acceptance in the business community.  The per annum interest
 39  1 rate shall be credited on a quarterly basis by applying one-
 39  2 quarter of the annual interest rate to the sum of the
 39  3 accumulated contributions as of the end of the previous
 39  4 calendar quarter.
 39  5    3.  Interest and interest dividends shall be credited to
 39  6 the contributions of active members and inactive vested
 39  7 members until the first of the month coinciding with or next
 39  8 following the member's retirement date.
 39  9    4.  Effective upon the date that the department determines
 39 10 that this subsection shall be implemented, interest Interest
 39 11 and interest dividends shall be credited to the contributions
 39 12 of a person who leaves the contributions in the retirement
 39 13 fund upon termination from covered employment prior to
 39 14 achieving vested status, but who subsequently achieves vested
 39 15 status.  The interest and interest dividends shall be credited
 39 16 to the contributions commencing either upon the date that the
 39 17 department determines that this subsection shall be
 39 18 implemented, or the date on which the person becomes a vested
 39 19 member, whichever is later.  Interest and interest dividends
 39 20 shall cease upon the first of the month coinciding with or
 39 21 next following the person's retirement date.  If the
 39 22 department no longer maintains the accumulated contribution
 39 23 account of the person pursuant to section 97B.53, but the
 39 24 person submits satisfactory proof to the department that the
 39 25 person did make the contributions, the department shall credit
 39 26 interest and interest dividends in the manner provided in this
 39 27 subsection.  However, the department shall not implement this
 39 28 subsection, unless and until the department determines that
 39 29 the most recent annual actuarial valuation of the retirement
 39 30 system indicates that the employer and employee contribution
 39 31 rates in effect under section 97B.11 can absorb the enactment
 39 32 of this subsection and the amendments to section 97B.41,
 39 33 subsection 12, section 97B.53, subsections 3 and 7, and
 39 34 section 97B.53, subsection 6, unnumbered paragraph 1,
 39 35 contained in 1994 Iowa Acts, chapter 1183, after meeting the
 40  1 other established priorities of the system, as defined in
 40  2 section 97B.41, subsection 12.
 40  3    Sec. 59.  Section 97B.72, unnumbered paragraphs 1 and 2,
 40  4 Code Supplement 1995, are amended to read as follows:
 40  5    Persons who are members of the Seventy-first General
 40  6 Assembly or a succeeding general assembly who submit proof to
 40  7 the department of membership in the general assembly during
 40  8 any period beginning July 4, 1953, may make contributions to
 40  9 the system for all or a portion of the period of service in
 40 10 the general assembly, and receive credit for the applicable
 40 11 period for which contributions are made.  The contributions
 40 12 made by the member shall be equal to the accumulated
 40 13 contributions as defined in section 97B.41, subsection 2,
 40 14 which would have been made if the member of the general
 40 15 assembly had been a member of the system during the applicable
 40 16 period.  The proof of membership in the general assembly and
 40 17 payment of accumulated contributions shall be transmitted to
 40 18 the department.  A member making contributions pursuant to
 40 19 this section may make the contributions either for the entire
 40 20 applicable period of service, or, effective upon the date that
 40 21 the department determines that the amendments to this
 40 22 paragraph and unnumbered paragraph 2 contained in 1994 Iowa
 40 23 Acts, chapter 1183, shall be implemented, for portions of the
 40 24 period of service, and if contributions are made for portions
 40 25 of the period of service, the contributions shall be in
 40 26 increments of one or more years, as long as the increments
 40 27 represent full years and not a portion of a year calendar
 40 28 quarters.  However, the department shall not implement the
 40 29 amendments to this paragraph or unnumbered paragraph 2, as
 40 30 enacted in 1994 Iowa Acts, chapter 1183, unless and until the
 40 31 department determines that the most recent annual actuarial
 40 32 valuation of the retirement system indicates that the employer
 40 33 and employee contribution rates in effect under section 97B.11
 40 34 can absorb the amendments to this paragraph and unnumbered
 40 35 paragraph 2 and to section 97B.66, unnumbered paragraphs 1 and
 41  1 2, section 97B.72A, subsection 1, unnumbered paragraph 1,
 41  2 section 97B.73A, unnumbered paragraph 1, and section 97B.74,
 41  3 unnumbered paragraphs 1 and 2, contained in 1994 Iowa Acts,
 41  4 chapter 1183, after meeting the other established priority of
 41  5 the system, as defined in section 97B.66.  Until the
 41  6 amendments are implemented, the department shall continue to
 41  7 implement the provisions of section 97B.72, unnumbered
 41  8 paragraphs 1 and 2, Code Supplement 1993.
 41  9    There is appropriated from moneys available to the general
 41 10 assembly under section 2.12 an amount sufficient to pay the
 41 11 contributions of the employer based on the period of service
 41 12 for which the members have paid accumulated contributions in
 41 13 an amount equal to the contributions which would have been
 41 14 made if the members of the general assembly who made employee
 41 15 contributions had been members of the system during the
 41 16 applicable period of service in the general assembly plus two
 41 17 percent interest plus and interest dividends at the rate
 41 18 provided in section 97B.70 for all completed calendar years,
 41 19 and for any completed calendar year for which the interest
 41 20 dividend has not been declared and for completed months of
 41 21 partially completed calendar years at two percent interest
 41 22 plus the interest dividend rate calculated for the previous
 41 23 year, compounded annually, from the end of the calendar year
 41 24 in which contribution was made to the first day of the month
 41 25 of such date as provided in section 97B.70.
 41 26    Sec. 60.  Section 97B.72A, subsection 1, Code Supplement
 41 27 1995, is amended to read as follows:
 41 28    1.  An active or A vested or retired member of the system
 41 29 who was a member of the general assembly prior to July 1,
 41 30 1988, may make contributions to the system for all or a
 41 31 portion of the period of service in the general assembly.  The
 41 32 contributions made by the member shall be equal to the
 41 33 accumulated contributions as defined in section 97B.41,
 41 34 subsection 2, which would have been made if the member of the
 41 35 general assembly had been a member of the system during the
 42  1 applicable period of service in the general assembly.  A
 42  2 member making contributions pursuant to this section may make
 42  3 the contributions either for the entire applicable period of
 42  4 service, or for portions of the period of service, and,
 42  5 effective upon the date that the department determines that
 42  6 the amendments to this paragraph contained in 1994 Iowa Acts,
 42  7 chapter 1183, shall be implemented, if contributions are made
 42  8 for portions of the period of service, the contributions shall
 42  9 be in increments of one or more years, as long as the
 42 10 increments represent full years and not a portion of a year
 42 11 calendar quarters.  The member of the system shall submit
 42 12 proof to the department of membership in the general assembly.
 42 13 The department shall credit the member with the period of
 42 14 membership service for which contributions are made.  However,
 42 15 the department shall not implement the amendments to this
 42 16 paragraph, as enacted in 1994 Iowa Acts, chapter 1183, unless
 42 17 and until the department determines that the most recent
 42 18 annual actuarial valuation of the retirement system indicates
 42 19 that the employer and employee contribution rates in effect
 42 20 under section 97B.11 can absorb the amendments to this
 42 21 paragraph and to section 97B.66, unnumbered paragraphs 1 and
 42 22 2, section 97B.72, unnumbered paragraphs 1 and 2, section
 42 23 97B.73A, unnumbered paragraph 1, and section 97B.74,
 42 24 unnumbered paragraphs 1 and 2, contained in 1994 Iowa Acts,
 42 25 chapter 1183, after meeting the other established priority of
 42 26 the system, as defined in section 97B.66.  Until the
 42 27 amendments are implemented, the department shall continue to
 42 28 implement the provisions of section 97B.72A, subsection 1,
 42 29 unnumbered paragraph 1, Code Supplement 1993.
 42 30    There is appropriated from the general fund of the state to
 42 31 the department an amount sufficient to pay the contributions
 42 32 of the employer based on the period of service of members of
 42 33 the general assembly for which the member paid accumulated
 42 34 contributions under this section.  The amount appropriated is
 42 35 equal to the employer contributions which would have been made
 43  1 if the members of the system who made employee contributions
 43  2 had been members of the system during the period for which
 43  3 they made employee contributions plus two percent interest
 43  4 plus the interest dividend rate applicable at the rate
 43  5 provided in section 97B.70 for each year compounded annually
 43  6 as provided in section 97B.70.
 43  7    Sec. 61.  Section 97B.73, unnumbered paragraph 1, Code
 43  8 1995, is amended to read as follows:
 43  9    A vested or retired member who was in public employment
 43 10 comparable to employment covered under this chapter in another
 43 11 state or in the federal government, or who was a member of
 43 12 another public retirement system in this state, including but
 43 13 not limited to the teachers insurance annuity association-
 43 14 college retirement equities fund, but who was not retired
 43 15 under that system, upon submitting verification of membership
 43 16 and service in the other public system to the department,
 43 17 including proof that the member has no further claim upon a
 43 18 retirement benefit from that other public system, may make
 43 19 employer and employee contributions to the system either for
 43 20 the entire period of service in the other public system, or
 43 21 for partial service in the other public system in increments
 43 22 of one or more years, as long as the increments represent full
 43 23 years and not a portion of a year calendar quarters.  The
 43 24 member may also make one lump sum contribution to the system
 43 25 which represents the entire period of service in the other
 43 26 public system, even if the period of time exceeds one year or
 43 27 includes a portion of a year.  If the member wishes to
 43 28 transfer only a portion of the service value of another public
 43 29 system to this system and the other public system allows a
 43 30 partial withdrawal of a member's system credits, the member
 43 31 shall receive credit for membership service in this system
 43 32 equivalent to the number of years period of service
 43 33 transferred from the other public system.  The contribution
 43 34 payable shall be based upon the member's covered wages for the
 43 35 most recent full calendar year at the applicable rates in
 44  1 effect for that calendar year under sections 97B.11 and 97B.49
 44  2 and multiplied by the member's years of service in other
 44  3 public employment.  If the member's most recent covered wages
 44  4 were earned prior to the most recent calendar year, the
 44  5 member's covered wages shall be adjusted by the department by
 44  6 an inflation factor to reflect changes in the economy since
 44  7 the covered wages were earned.
 44  8    Sec. 62.  Section 97B.73A, unnumbered paragraph 1, Code
 44  9 Supplement 1995, is amended to read as follows:
 44 10    A part-time county attorney may elect in writing to the
 44 11 department to make employee contributions to the system for
 44 12 the county attorney's previous service as a county attorney
 44 13 and receive credit for membership service in the system for
 44 14 the applicable period of service as a part-time county
 44 15 attorney for which employee contributions are made.  The
 44 16 contributions paid by the member shall be equal to the
 44 17 accumulated contributions, as defined in section 97B.41,
 44 18 subsection 2, for the applicable period of membership service.
 44 19 A member making contributions pursuant to this section may
 44 20 make the contributions either for the entire applicable period
 44 21 of service, or, effective upon the date that the department
 44 22 determines that the amendments to this paragraph contained in
 44 23 1994 Iowa Acts, chapter 1183, shall be implemented, for
 44 24 portions of the period of service, and if contributions are
 44 25 made for portions of the period of service, the contributions
 44 26 shall be in increments of one or more years, as long as the
 44 27 increments represent full years and not a portion of a year
 44 28 calendar quarters.  A member who elects to make contributions
 44 29 under this section shall notify the applicable county board of
 44 30 supervisors of the member's election, and the county board of
 44 31 supervisors shall pay to the department the employer
 44 32 contributions that would have been contributed by the employer
 44 33 under section 97B.11 plus interest on the contributions that
 44 34 would have accrued if the county attorney had been a member of
 44 35 the system for the applicable period of service.  However, the
 45  1 department shall not implement the amendments to this
 45  2 paragraph, as enacted in 1994 Iowa Acts, chapter 1183, unless
 45  3 and until the department determines that the most recent
 45  4 annual actuarial valuation of the retirement system indicates
 45  5 that the employer and employee contribution rates in effect
 45  6 under section 97B.11 can absorb the amendments to this
 45  7 paragraph and to section 97B.66, unnumbered paragraphs 1 and
 45  8 2, section 97B.72, unnumbered paragraphs 1 and 2, section
 45  9 97B.72A, subsection 1, unnumbered paragraph 1, and section
 45 10 97B.74, unnumbered paragraphs 1 and 2, contained in 1994 Iowa
 45 11 Acts, chapter 1183, after meeting the other established
 45 12 priority of the system, as defined in section 97B.66.  Until
 45 13 the amendments are implemented, the department shall continue
 45 14 to implement the provisions of section 97B.73A, unnumbered
 45 15 paragraph 1, Code Supplement 1993.
 45 16    Sec. 63.  Section 97B.74, unnumbered paragraphs 1 and 2,
 45 17 Code Supplement 1995, are amended to read as follows:
 45 18    An active, A vested, or retired member who was a member of
 45 19 the system at any time on or after July 4, 1953, and who
 45 20 received a refund of the member's contributions for that
 45 21 period of membership service, may elect in writing to the
 45 22 department to make contributions to the system for all or a
 45 23 portion of the period of membership service for which a refund
 45 24 of contributions was made, and receive credit for the period
 45 25 of membership service for which contributions are made.  The
 45 26 contributions repaid by the member for such service shall be
 45 27 equal to the accumulated contributions, as defined in section
 45 28 97B.41, subsection 2, received by the member for the
 45 29 applicable period of membership service plus interest on the
 45 30 accumulated contributions for the applicable period from the
 45 31 date of receipt by the member to the date of repayment equal
 45 32 to two percent plus at the interest dividend rate provided in
 45 33 section 97B.70 applicable for each year compounded annually as
 45 34 provided in section 97B.70.
 45 35    An active member must have at least one quarter's
 46  1 reportable wages on file and have membership service,
 46  2 including that period of membership service for which a refund
 46  3 of contributions was made, sufficient to give the member
 46  4 vested status.  A member making contributions pursuant to this
 46  5 section may make the contributions either for the entire
 46  6 applicable period of service, or, effective upon the date that
 46  7 the department determines that the amendments to this
 46  8 paragraph and unnumbered paragraph 1 contained in 1994 Iowa
 46  9 Acts, chapter 1183, shall be implemented, for portions of the
 46 10 period of service, and if contributions are made for portions
 46 11 of the period of service, the contributions shall be in
 46 12 increments of one or more years, as long as the increments
 46 13 represent full years and not a portion of a year calendar
 46 14 quarters.  However, the department shall not implement the
 46 15 amendments to this paragraph or unnumbered paragraph 1, as
 46 16 enacted in 1994 Iowa Acts, chapter 1183, unless and until the
 46 17 department determines that the most recent annual actuarial
 46 18 valuation of the retirement system indicates that the employer
 46 19 and employee contribution rates in effect under section 97B.11
 46 20 can absorb the amendments to this paragraph and to unnumbered
 46 21 paragraph 1 and to section 97B.66, unnumbered paragraphs 1 and
 46 22 2, section 97B.72, unnumbered paragraphs 1 and 2, section
 46 23 97B.72A, subsection 1, unnumbered paragraph 1, and section
 46 24 97B.73A, unnumbered paragraph 1, contained in 1994 Iowa Acts,
 46 25 chapter 1183, after meeting the other established priority of
 46 26 the system, as defined in section 97B.66.  Until the
 46 27 amendments are implemented, the department shall continue to
 46 28 implement the provisions of section 97B.74, unnumbered
 46 29 paragraphs 1 and 2, Code Supplement 1993.
 46 30    Sec. 64.  Section 97B.80, unnumbered paragraph 1, Code
 46 31 1995, is amended to read as follows:
 46 32    Effective July 1, 1992, a vested or retired member, who at
 46 33 any time served on active duty in the armed forces of the
 46 34 United States, upon submitting verification of the dates of
 46 35 the active duty service, may make employer and employee
 47  1 contributions to the system based upon the member's covered
 47  2 wages for the most recent full calendar year in which the
 47  3 member had reportable wages at the applicable rates in effect
 47  4 for that year under sections 97B.11 and 97B.49, for all or a
 47  5 portion of the period of time of the active duty service, in
 47  6 increments of no greater than one year and not less than one
 47  7 or more calendar quarter quarters, and receive credit for
 47  8 membership service and prior service for the period of time
 47  9 for which the contributions are made.  However, the member may
 47 10 not make contributions in an increment of less than one year
 47 11 more than once.  The member may also make one lump sum
 47 12 contribution to the system which represents the period of time
 47 13 of the active duty service, even if the period of time exceeds
 47 14 one year.  If the member's most recent covered wages were
 47 15 earned prior to the most recent calendar year, the member's
 47 16 covered wages shall be adjusted by the department by an
 47 17 inflation factor to reflect changes in the economy.  The
 47 18 department shall adjust benefits for a six-month period prior
 47 19 to the date the member pays contributions under this section
 47 20 if the member is receiving a retirement allowance at the time
 47 21 the contribution payment is made.  Verification of active duty
 47 22 service and payment of contributions shall be made to the
 47 23 department.  However, a member is not eligible to make
 47 24 contributions under this section if the member is receiving,
 47 25 is eligible to receive, or may in the future be eligible to
 47 26 receive retirement pay from the United States government for
 47 27 active duty in the armed forces, except for retirement pay
 47 28 granted by the United States government under retired pay for
 47 29 nonregular service (10 U.S.C. } 1331, et seq.).  A member
 47 30 receiving retired pay for nonregular service who makes
 47 31 contributions under this section shall provide information
 47 32 required by the department documenting time periods covered
 47 33 under retired pay for nonregular service.  
 47 34                           DIVISION II
 47 35            PUBLIC SAFETY PEACE OFFICERS' RETIREMENT,
 48  1                 ACCIDENT, AND DISABILITY SYSTEM
 48  2    Sec. 65.  Section 97A.5, subsection 9, Code 1995, is
 48  3 amended to read as follows:
 48  4    9.  DUTIES OF COMMISSIONER OF INSURANCE ACTUARY.  The state
 48  5 commissioner of insurance actuary hired by the board of
 48  6 trustees shall be the technical advisor of the board of
 48  7 trustees on matters regarding the operation of the funds
 48  8 created by the provisions of this chapter and shall perform
 48  9 such other duties as are required in connection therewith.
 48 10    Sec. 66.  Section 97A.5, subsections 10 through 12, Code
 48 11 1995, are amended to read as follows:
 48 12    10.  TABLES &endash; RATES.  Immediately after the establishment
 48 13 of this system, the state commissioner of insurance The
 48 14 actuary hired by the board of trustees shall make such
 48 15 investigation of anticipated interest earnings and of the
 48 16 mortality, service, and compensation experience of the members
 48 17 of the system as the actuary shall recommend and the board of
 48 18 trustees shall authorize recommends, and on the basis of such
 48 19 the investigation, the actuary shall recommend for adoption by
 48 20 the board of trustees such shall adopt the tables and such the
 48 21 rates as are required in subsection 11 of this section.  The
 48 22 board of trustees shall adopt the rate of interest and tables,
 48 23 and certify rates of contributions to be used by the system.
 48 24    11.  ACTUARIAL INVESTIGATION.  In the year 1952, and at At
 48 25 least once in each two-year period thereafter, the state
 48 26 commissioner of insurance the actuary hired by the board of
 48 27 trustees shall make an actuarial investigation in the
 48 28 mortality, service, and compensation experience of the members
 48 29 and beneficiaries of the system, and the interest and other
 48 30 earnings on the moneys and other assets of the system, and
 48 31 shall make a valuation of the assets and liabilities of the
 48 32 funds of the system, and taking into account the results of
 48 33 such the investigation and valuation, the board of trustees
 48 34 shall:
 48 35    a.  Adopt for the system such interest rate, mortality and
 49  1 other tables as shall be deemed necessary;
 49  2    b.  Certify the rates of contribution payable by the state
 49  3 of Iowa in accordance with section 97A.8.
 49  4    12.  VALUATION.  On the basis of such the rate of interest
 49  5 and such tables as adopted by the board of trustees shall
 49  6 adopt, the state commissioner of insurance the actuary hired
 49  7 by the board of trustees shall make an annual valuation of the
 49  8 assets and liabilities of the funds of the system created by
 49  9 this chapter.
 49 10    Sec. 67.  Section 97A.5, Code 1995, is amended by adding
 49 11 the following new subsections:
 49 12    NEW SUBSECTION.  14.  INVESTMENT CONTRACTS.  The board of
 49 13 trustees may execute contracts and agreements with investment
 49 14 advisors, consultants, and investment management and benefit
 49 15 consultant firms in the administration of the funds
 49 16 established in section 97A.8.
 49 17    NEW SUBSECTION.  15.  LIABILITY.  The department, the board
 49 18 of trustees, and the treasurer of state are not personally
 49 19 liable for claims based upon an act or omission of the person
 49 20 performed in the discharge of the person's duties under this
 49 21 chapter, even if those actions or omissions violate the
 49 22 standards established in section 97A.7, except for acts or
 49 23 omissions which involve malicious or wanton misconduct.
 49 24    Sec. 68.  Section 97A.6, subsection 1, paragraph a, Code
 49 25 1995, is amended to read as follows:
 49 26    a.  Any member in service may retire upon the member's
 49 27 written application to the board of trustees, setting forth at
 49 28 what time, not less than thirty nor more than ninety days
 49 29 subsequent to the execution and filing therefor, the member
 49 30 desires to be retired, provided, that the said member at the
 49 31 time so specified for retirement shall have attained the age
 49 32 of fifty-five and shall have completed twenty-two years or
 49 33 more of creditable service, and notwithstanding that, during
 49 34 such period of notification, the member may have separated
 49 35 from the service.  However, a member may retire at fifty years
 50  1 of age and receive a reduced retirement allowance pursuant to
 50  2 subsection 2A.
 50  3    Sec. 69.  Section 97A.6, subsection 2, paragraph d,
 50  4 subparagraph (3), Code 1995, is amended to read as follows:
 50  5    (3)  For a member who terminates service, other than by
 50  6 death or disability, on or after October 16, 1992, but before
 50  7 July 1, 1996, and who does not withdraw the member's
 50  8 contributions pursuant to section 97A.16, upon the member's
 50  9 retirement there shall be added six-tenths percent of the
 50 10 member's average final compensation for each year of service
 50 11 over twenty-two years.  However, this subparagraph does not
 50 12 apply to more than eight additional years of service.
 50 13    Sec. 70.  Section 97A.6, subsection 2, paragraph d, Code
 50 14 1995, is amended by adding the following new subparagraph:
 50 15    NEW SUBPARAGRAPH.  (4)  For a member who terminates
 50 16 service, other than by death or disability, on or after July
 50 17 1, 1996, and who does not withdraw the member's contributions
 50 18 pursuant to section 97A.16, upon the member's retirement there
 50 19 shall be added one and one-half percent of the member's
 50 20 average final compensation for each year of service over
 50 21 twenty-two years.  However, this subparagraph does not apply
 50 22 to more than eight additional years of service.
 50 23    Sec. 71.  Section 97A.6, subsection 10, Code 1995, is
 50 24 amended to read as follows:
 50 25    10.  OPTIONAL ALLOWANCE.  With the provision that no
 50 26 optional selection shall be effective in case a beneficiary
 50 27 dies within thirty days after retirement, in which event such
 50 28 a beneficiary shall be considered as an active member at the
 50 29 time of death, until the first payment on account of any
 50 30 benefit becomes normally due, any beneficiary may elect to
 50 31 receive the beneficiary's benefit in a retirement allowance
 50 32 payable throughout life, or may elect to receive the actuarial
 50 33 equivalent at that time of the beneficiary's retirement
 50 34 allowance in a lesser retirement allowance payable throughout
 50 35 life with the provision that an amount in money not exceeding
 51  1 the amount of the beneficiary's accumulated contributions
 51  2 shall be immediately paid in cash to such member or some other
 51  3 benefit or benefits shall be paid either to the member or to
 51  4 such person or persons as the member shall nominate, provided
 51  5 such cash payment or other benefit or benefits, together with
 51  6 the lesser retirement allowance, shall be certified by the
 51  7 state commissioner of insurance actuary to be of equivalent
 51  8 actuarial value to the member's retirement allowance and shall
 51  9 be approved by the board of trustees; provided, that a cash
 51 10 payment to such member or beneficiary at the time of
 51 11 retirement of an amount not exceeding fifty percent of the
 51 12 member's or beneficiary's accumulated contributions shall be
 51 13 made by the board of trustees upon said member's or
 51 14 beneficiary's election.
 51 15    Sec. 72.  Section 97A.6, subsection 12, unnumbered
 51 16 paragraph 1, Code 1995, is amended to read as follows:
 51 17    Pension to surviving spouse and children of deceased
 51 18 pensioned members.  In the event of the death of any member
 51 19 receiving a retirement allowance under the provisions of
 51 20 subsections 2, 2A, 4, or 6 of this section there shall be paid
 51 21 a pension:
 51 22    Sec. 73.  Section 97A.6, subsection 12, paragraph a, Code
 51 23 1995, is amended to read as follows:
 51 24    a.  To the member's surviving spouse, equal to one-half the
 51 25 amount received by the deceased beneficiary, but in no
 51 26 instance less than an amount equal to twenty twenty-five
 51 27 percent of the monthly earnable compensation paid to an active
 51 28 member having the rank of senior patrol officer of the Iowa
 51 29 highway safety patrol, and in addition a monthly pension equal
 51 30 to the monthly pension payable under subsection 9, paragraph
 51 31 "c," of this section for each child under eighteen years of
 51 32 age or twenty-two years of age if applicable; or
 51 33    Sec. 74.  Section 97A.6, subsection 14, paragraph a,
 51 34 subparagraphs (1), (2), and (3), Code 1995, are amended to
 51 35 read as follows:
 52  1    (1)  Twenty-five Thirty percent for members receiving a
 52  2 service retirement allowance and for beneficiaries receiving a
 52  3 pension under subsection 9 of this section.  However,
 52  4 effective July 1, 1990, for members who retired before that
 52  5 date, thirty percent shall be the applicable percentage for
 52  6 members and beneficiaries under this subparagraph.
 52  7    (2)  Twenty-five Thirty percent for members with five or
 52  8 more years of membership service who are receiving an ordinary
 52  9 disability retirement allowance.  However, effective July 1,
 52 10 1990, for members who retired before that date, thirty percent
 52 11 shall be the applicable percentage for members under this
 52 12 subparagraph.
 52 13    (3)  Twelve and one-half Fifteen percent for members with
 52 14 less than five years of membership service who are receiving
 52 15 an ordinary disability retirement allowance, and for
 52 16 beneficiaries receiving a pension under subsection 8 of this
 52 17 section.  However, effective July 1, 1990, for members who
 52 18 retired before that date, fifteen percent shall be the
 52 19 applicable percentage for members and beneficiaries under this
 52 20 subparagraph.
 52 21    Sec. 75.  Section 97A.6, subsection 14, paragraph d, Code
 52 22 1995, is amended to read as follows:
 52 23    d.  A retired member eligible for benefits under the
 52 24 provisions of subsection 1 is not eligible for the annual
 52 25 readjustment of pensions provided in this subsection unless
 52 26 the member served at least twenty-two years and attained the
 52 27 age of fifty-five years prior to the member's termination of
 52 28 employment.
 52 29    Sec. 76.  Section 97A.6, Code 1995, is amended by adding
 52 30 the following new subsection:
 52 31    NEW SUBSECTION.  2A.  EARLY RETIREMENT BENEFITS.
 52 32    a.  Notwithstanding the calculation of the service
 52 33 retirement allowance under subsection 2, beginning July 1,
 52 34 1996, a member who has completed twenty-two years or more of
 52 35 creditable service and is at least fifty years of age, but
 53  1 less than fifty-five years of age, who has otherwise completed
 53  2 the requirements for retirement under subsection 1, may retire
 53  3 and receive a reduced service retirement allowance pursuant to
 53  4 this subsection.  The service retirement allowance for a
 53  5 member less than fifty-five years of age shall be calculated
 53  6 in the manner prescribed in subsection 2, except that the
 53  7 percentage multiplier of the member's average final
 53  8 compensation used in the determination of the service
 53  9 retirement allowance shall be reduced by the board of trustees
 53 10 pursuant to paragraph "b".
 53 11    b.  On July 1, 1996, and on each July 1 thereafter, the
 53 12 board of trustees shall determine for the respective fiscal
 53 13 year the percent by which the percentage multiplier under
 53 14 subsection 2 shall be reduced for each month that a member's
 53 15 retirement date precedes the member's fifty-fifth birthday.
 53 16 The board of trustees shall make this determination based upon
 53 17 the most recent actuarial valuation of the system, the
 53 18 calculation of the acturial cost for each month of retirement
 53 19 of a member prior to age fifty-five, and the premise that the
 53 20 provision of a service retirement allowance to a member who is
 53 21 less than fifty-five years of age will not result in any
 53 22 increase in cost to the system.
 53 23    Sec. 77.  Section 97A.7, subsection 2, Code 1995, is
 53 24 amended to read as follows:
 53 25    2.  The several funds created by this chapter may be
 53 26 invested in:
 53 27    a.  Bonds or other evidences of indebtedness issued,
 53 28 assumed, or guaranteed by the United States of America, or by
 53 29 any agency or instrumentality thereof.
 53 30    b.  In savings accounts or time deposits in Iowa banks
 53 31 approved as depositories by the executive council.
 53 32    c.  In any investments authorized for the Iowa public
 53 33 employees' retirement system in section 97B.7, subsection 2,
 53 34 paragraph "b".
 53 35    Sec. 78.  Section 97A.8, subsection 1, paragraph b, Code
 54  1 1995, is amended to read as follows:
 54  2    b.  On the basis of the rate of interest and of the
 54  3 mortality, interest, and other tables adopted by the board of
 54  4 trustees, the state commissioner of insurance board of
 54  5 trustees, upon the advice of the actuary hired by the board
 54  6 for that purpose, shall make each valuation required by this
 54  7 chapter and shall immediately after making such valuation,
 54  8 determine the "normal contribution rate".  The normal
 54  9 contribution rate shall be the rate percent of the earnable
 54 10 compensation of all members obtained by deducting from the
 54 11 total liabilities of the fund the sum of the amount of the
 54 12 funds in hand to the credit of the fund and dividing the
 54 13 remainder by one percent of the present value of the
 54 14 prospective future compensation of all members as computed on
 54 15 the basis of the rate of interest and of mortality and service
 54 16 tables adopted by the board of trustees, all reduced by the
 54 17 employee contribution made pursuant to this subsection.
 54 18 However, the normal rate of contribution shall not be less
 54 19 than seventeen percent.  The normal rate of contribution shall
 54 20 be determined by the state commissioner of insurance board of
 54 21 trustees after each valuation.
 54 22    Sec. 79.  Section 97A.8, subsection 1, paragraph c,
 54 23 unnumbered paragraph 3, Code 1995, is amended by striking the
 54 24 unnumbered paragraph.
 54 25    Sec. 80.  Section 97A.8, subsection 1, paragraph f,
 54 26 subparagraph (8), Code 1995, is amended to read as follows:
 54 27    (8)  Notwithstanding any other provision of this chapter,
 54 28 beginning July 1, 1996, and each fiscal year thereafter, the
 54 29 member's contribution rate shall be equivalent to the member's
 54 30 contribution rate provided under section 411.8, subsection 1,
 54 31 paragraph "f", for the statewide fire and police retirement
 54 32 system for the applicable fiscal year an amount equal to the
 54 33 member's contribution rate times each member's compensation
 54 34 shall be paid to the pension accumulation fund from the
 54 35 earnable compensation of the member.  For the purposes of this
 55  1 subparagraph, the member's contribution rate shall be nine and
 55  2 thirty-five hundredths percent.  However, the system shall
 55  3 increase the member's contribution rate as necessary to cover
 55  4 any increase in cost to the system resulting from statutory
 55  5 changes which are enacted by any session of the general
 55  6 assembly meeting after January 1, 1995, if the increase cannot
 55  7 be absorbed within the contribution rates otherwise
 55  8 established pursuant to this paragraph, but subject to a
 55  9 maximum employee contribution rate of eleven and three-tenths
 55 10 percent.  After the employee contribution reaches eleven and
 55 11 three-tenths percent, sixty percent of the additional cost of
 55 12 such statutory changes shall be paid by the employer under
 55 13 paragraph "c" and forty percent of the additional cost shall
 55 14 be paid by employees under this paragraph.
 55 15    Sec. 81.  Section 97A.8, subsection 3, Code 1995, is
 55 16 amended to read as follows:
 55 17    3.  EXPENSE FUND.  The expense fund shall be the fund to
 55 18 which shall be credited all money provided by the state of
 55 19 Iowa to pay the administration expenses of the system and from
 55 20 which shall be paid all the expenses necessary in connection
 55 21 with the administration and operation of the system.
 55 22 Biennially the board of trustees shall estimate the amount of
 55 23 money necessary to be paid into the expense fund during the
 55 24 ensuing biennium to provide for the expense of operation of
 55 25 the system.  Investment management expenses shall be charged
 55 26 to the investment income of the system and there is
 55 27 appropriated from the system an amount required for the
 55 28 investment management expenses.  The board of trustees shall
 55 29 report the investment management expenses for the fiscal year
 55 30 as a percent of the market value of the system.
 55 31    For purposes of this subsection, investment management
 55 32 expenses are limited to the following:
 55 33    a.  Fees for investment advisors, consultants, and
 55 34 investment management and benefit consultant firms hired by
 55 35 the board of trustees in administering this chapter.
 56  1    b.  Fees and costs for safekeeping fund assets.
 56  2    c.  Costs for performance and compliance monitoring, and
 56  3 accounting for fund investments.
 56  4    d.  Any other costs necessary to prudently invest or
 56  5 protect the assets of the fund.
 56  6    Sec. 82.  Section 97A.12, Code 1995, is amended to read as
 56  7 follows:
 56  8    97A.12  EXEMPTION FROM EXECUTION AND OTHER PROCESS OR
 56  9 ASSIGNMENT.
 56 10    The right of any person to a pension, annuity, or
 56 11 retirement allowance, to the return of contributions, the
 56 12 pension, annuity, or retirement allowance itself, any optional
 56 13 benefit or death benefit, any other right accrued or accruing
 56 14 to any person under this chapter, and the moneys in the
 56 15 various funds created under this chapter, are not subject to
 56 16 execution, garnishment, attachment, or any other process
 56 17 whatsoever, and are unassignable except for the purposes of
 56 18 enforcing child, spousal, or medical support obligations or
 56 19 marital property orders, or as in this chapter otherwise
 56 20 specifically provided in this chapter.  For the purposes of
 56 21 enforcing child, spousal, or medical support obligations or
 56 22 marital property orders, the garnishment or attachment of or
 56 23 the execution against compensation due a person under this
 56 24 chapter shall not exceed the amount specified in 15 U.S.C. }
 56 25 1673(b).
 56 26    Sec. 83.  NEW SECTION.  97A.17  OPTIONAL TRANSFERS WITH
 56 27 CHAPTER 411.
 56 28    1.  For purposes of this section unless the context
 56 29 otherwise requires:
 56 30    a.  "Average accrued benefit" means the average of the
 56 31 amounts representing the present value of the accrued benefit
 56 32 earned by the member determined by the former system and the
 56 33 present value of the accrued benefit earned by the member
 56 34 determined by the current system.
 56 35    b.  "Current system" means the eligible retirement system
 57  1 in which a person has commenced employment covered by the
 57  2 system after having terminated employment covered by the
 57  3 former system.
 57  4    c.  "Eligible retirement system" means the system created
 57  5 under this chapter and the statewide fire and police
 57  6 retirement system established in chapter 411.
 57  7    d.  "Former system" means the eligible retirement system in
 57  8 which a person has terminated employment covered by the system
 57  9 prior to commencing employment covered by the current system.
 57 10    2.  Commencing July 1, 1996, a vested member of an eligible
 57 11 retirement system who terminates employment covered by one
 57 12 eligible retirement system and, within sixty days, commences
 57 13 employment covered by the other eligible retirement system may
 57 14 elect to transfer the average accrued benefit earned from the
 57 15 former system to the current system.  The member shall file an
 57 16 application with the current system for transfer of the
 57 17 average accrued benefit within ninety days of the commencement
 57 18 of employment with the current system.
 57 19    3.  Notwithstanding subsection 2, a vested member whose
 57 20 employment with the current system commenced prior to July 1,
 57 21 1996, may elect to transfer the average accrued benefit earned
 57 22 under the former system to the current system by filing an
 57 23 application with the current system for transfer of the
 57 24 average accrued benefit on or before July 1, 1997.
 57 25    4.  Upon receipt of an application for transfer of the
 57 26 average accrued benefit, the current system shall calculate
 57 27 the average accrued benefit and the former system shall
 57 28 transfer to the current system assets in an amount equal to
 57 29 the average accrued benefit.  Once the transfer of the average
 57 30 accrued benefit is completed, the member's service under the
 57 31 former system shall be treated as membership service under the
 57 32 current system for purposes of this chapter and chapter 411.  
 57 33                          DIVISION III
 57 34           STATEWIDE FIRE AND POLICE RETIREMENT SYSTEM
 57 35    Sec. 84.  Section 400.8, subsection 1, Code 1995, is
 58  1 amended to read as follows:
 58  2    1.  The commission, when necessary under the rules,
 58  3 including minimum and maximum age limits, which shall be
 58  4 prescribed and published in advance by the commission and
 58  5 posted in the city hall, shall hold examinations for the
 58  6 purpose of determining the qualifications of applicants for
 58  7 positions under civil service, other than promotions, which
 58  8 examinations shall be practical in character and shall relate
 58  9 to matters which will fairly test the mental and physical
 58 10 ability of the applicant to discharge the duties of the
 58 11 position to which the applicant seeks appointment.  The
 58 12 physical examination of applicants for appointment to the
 58 13 positions of police officer, police matron, or fire fighter
 58 14 shall be held in accordance with medical protocols established
 58 15 by the board of trustees of the fire and police retirement
 58 16 system established by section 411.5.  The board of trustees
 58 17 may change the medical protocols at any time the board so
 58 18 determines.  The commission shall conduct a medical
 58 19 examination of an applicant for the position of police
 58 20 officer, police matron, or fire fighter after a conditional
 58 21 offer of employment has been made to the applicant.  An
 58 22 applicant shall not be discriminated against on the basis of
 58 23 height, weight, sex, or race in determining physical or mental
 58 24 ability of the applicant.  Reasonable rules relating to
 58 25 strength, agility, and general health of applicants shall be
 58 26 prescribed.  The costs of the physical examination required
 58 27 under this subsection shall be paid from the trust and agency
 58 28 fund of the city.
 58 29    Sec. 85.  Section 411.5, Code 1995, is amended by adding
 58 30 the following new subsection:
 58 31    NEW SUBSECTION.  13.  VOLUNTARY BENEFIT PROGRAMS.  The
 58 32 board of trustees shall be responsible for the administration
 58 33 of the voluntary benefit programs established under section
 58 34 411.40.  The board may take any necessary action, including
 58 35 the adoption of rules, for purposes of administering the
 59  1 programs.
 59  2    Sec. 86.  Section 411.6, subsection 7, paragraph a,
 59  3 unnumbered paragraph 1, Code 1995, is amended to read as
 59  4 follows:
 59  5    Should any beneficiary for either ordinary or accidental
 59  6 disability, except a beneficiary who is fifty-five years of
 59  7 age or over and would have completed twenty-two years of
 59  8 service if the beneficiary had remained in active service, be
 59  9 engaged in a gainful occupation paying more than the
 59 10 difference between the member's retirement allowance and one
 59 11 and one-half times the earnable compensation of an active
 59 12 member at the same position on the salary scale within the
 59 13 member's rank as the member held at retirement, then the
 59 14 amount of the member's retirement allowance shall be reduced
 59 15 to an amount which together with the amount earned by the
 59 16 member shall equal one and one-half times the amount of the
 59 17 current earnable compensation of an active member at the same
 59 18 position on the salary scale within the member's rank as the
 59 19 member held at retirement.  Should the member's earning
 59 20 capacity be later changed, the amount of the member's
 59 21 retirement allowance may be further modified, provided, that
 59 22 the new retirement allowance shall not exceed the amount of
 59 23 the retirement allowance adjusted by annual readjustments of
 59 24 pensions pursuant to subsection 12 of this section nor an
 59 25 amount which, when added to the amount earned by the
 59 26 beneficiary, equals one and one-half times the amount of the
 59 27 earnable compensation of an active member at the same position
 59 28 on the salary scale within the member's rank as the member
 59 29 held at retirement.  A beneficiary restored to active service
 59 30 at a salary less than the average final compensation upon the
 59 31 basis of which the member was retired at age fifty-five or
 59 32 greater, shall not again become a member of the retirement
 59 33 system and shall have the member's retirement allowance
 59 34 suspended while in active service.  If the rank or position
 59 35 held by the retired member is subsequently abolished,
 60  1 adjustments to the allowable limit on the amount of income
 60  2 which can be earned in a gainful occupation shall be computed
 60  3 in the same manner as provided in subsection 12, paragraph
 60  4 "c", of this section for readjustment of pensions when a rank
 60  5 or position has been abolished by the board of trustees as
 60  6 through such rank or position had not been abolished and
 60  7 salary increases had been granted to such rank or position on
 60  8 the same basis as increases granted to other ranks and
 60  9 positions in the department.
 60 10    Sec. 87.  Section 411.6, subsection 12, paragraphs a
 60 11 through c, Code 1995, are amended by striking the paragraphs
 60 12 and inserting in lieu thereof the following:
 60 13    a.  On each July 1, the monthly pensions authorized in this
 60 14 section payable to retired members and to beneficiaries shall
 60 15 be adjusted as provided in this subsection.  An amount equal
 60 16 to the sum of one and one-half percent of the monthly pension
 60 17 of each retired member and beneficiary and the applicable
 60 18 incremental amount shall be added to the monthly pension of
 60 19 each retired member and beneficiary.  The board of trustees
 60 20 shall report to the general assembly every six years, by
 60 21 September 15 of that year, beginning with September 15, 2001,
 60 22 on whether the provisions of this subsection continue to pro-
 60 23 vide an equitable method for the annual readjustment of
 60 24 pensions payable under this chapter.
 60 25    b.  For purposes of this subsection, "applicable
 60 26 incremental amount" means the following amount for members
 60 27 receiving a pension under subsection 2, 4, or 6 and for
 60 28 beneficiaries receiving a pension under subsection 11:
 60 29    (1)  Fifteen dollars where the member's retirement date was
 60 30 less than five years prior to the effective date of the
 60 31 increase.
 60 32    (2)  Twenty dollars where the member's retirement date was
 60 33 at least five years, but less than ten years, prior to the
 60 34 effective date of the increase.
 60 35    (3)  Twenty-five dollars where the member's retirement date
 61  1 was at least ten years, but less than fifteen years, prior to
 61  2 the effective date of the increase.
 61  3    (4)  Thirty dollars where the member's retirement date was
 61  4 at least fifteen years, but less than twenty years, prior to
 61  5 the effective date of the increase.
 61  6    (5)  Thirty-five dollars where the member's retirement date
 61  7 was at least twenty years prior to the effective date of the
 61  8 increase.
 61  9    c.  For beneficiaries receiving a pension under subsection
 61 10 8 or 9, the applicable incremental amount shall be determined
 61 11 as set forth in paragraph "b", except that the date of the
 61 12 member's death shall be substituted for the member's
 61 13 retirement date.
 61 14    Sec. 88.  Section 411.6, subsection 12, Code 1995, is
 61 15 amended by adding the following new paragraph:
 61 16    NEW PARAGRAPH.  e.  A retired member eligible for benefits
 61 17 under this section and otherwise eligible for the readjustment
 61 18 of benefits provided in this subsection is not eligible for
 61 19 the readjustment unless the member was retired on or before
 61 20 the effective date of the readjustment.
 61 21    Sec. 89.  Section 411.13, Code 1995, is amended to read as
 61 22 follows:
 61 23    411.13  EXEMPTION FROM EXECUTION AND OTHER PROCESS, OR
 61 24 ASSIGNMENT &endash; EXCEPTIONS.
 61 25    The right of any person to a pension, annuity, or
 61 26 retirement allowance, to the return of contributions, the
 61 27 pension, annuity, or retirement allowance itself, any optional
 61 28 benefit or death benefit, any other right accrued or accruing
 61 29 to any person under this chapter, and the moneys in the fire
 61 30 and police retirement fund created under this chapter, are not
 61 31 subject to execution, garnishment, attachment, or any other
 61 32 process whatsoever, and are unassignable except for the
 61 33 purposes of enforcing child, spousal, or medical support obli-
 61 34 gations or marital property orders, or as in this chapter
 61 35 otherwise specifically provided in this chapter.  For the
 62  1 purposes of enforcing child, spousal, or medical support
 62  2 obligations or marital property orders, the garnishment or
 62  3 attachment of or the execution against compensation due a
 62  4 person under this chapter shall not exceed the amount
 62  5 specified in 15 U.S.C. } 1673(b).
 62  6    Sec. 90.  NEW SECTION.  411.31  OPTIONAL TRANSFERS WITH
 62  7 CHAPTER 97A.
 62  8    1.  For purposes of this section, unless the context
 62  9 otherwise requires:
 62 10    a.  "Average accrued benefit" means the average of the
 62 11 amounts representing the present value of the accrued benefit
 62 12 earned by the member determined by the former system and the
 62 13 present value of the accrued benefit earned by the member
 62 14 determined by the current system.
 62 15    b.  "Current system" means the eligible retirement system
 62 16 in which a person has commenced employment covered by the
 62 17 system after having terminated employment covered by the
 62 18 former system.
 62 19    c.  "Eligible retirement system" means the system created
 62 20 under this chapter and the Iowa department of public safety
 62 21 peace officers' retirement, accident, and disability system
 62 22 established in chapter 97A.
 62 23    d.  "Former system" means the eligible retirement system in
 62 24 which a person has terminated employment covered by the system
 62 25 prior to commencing employment covered by the current system.
 62 26    2.  Commencing July 1, 1996, a vested member of an eligible
 62 27 retirement system who terminates employment covered by one
 62 28 eligible retirement system and, within sixty days, commences
 62 29 employment covered by the other eligible retirement system may
 62 30 elect to transfer the average accrued benefit earned from the
 62 31 former system to the current system.  The member shall file an
 62 32 application with the current system for transfer of the
 62 33 average accrued benefit within ninety days of the commencement
 62 34 of employment with the current system.
 62 35    3.  Notwithstanding subsection 2, a vested member whose
 63  1 employment with the current system commenced prior to July 1,
 63  2 1996, may elect to transfer the average accrued benefit earned
 63  3 under the former system to the current system by filing an
 63  4 application with the current system for transfer of the
 63  5 average accrued benefit on or before July 1, 1997.
 63  6    4.  Upon receipt of an application for transfer of the
 63  7 average accrued benefit, the current system shall calculate
 63  8 the average accrued benefit and the former system shall
 63  9 transfer to the current system assets in an amount equal to
 63 10 the average accrued benefit.  Once the transfer of the average
 63 11 accrued benefit is completed, the member's service under the
 63 12 former system shall be treated as membership service under the
 63 13 current system for purposes of this chapter and chapter 97A.
 63 14    Sec. 91.  Section 411.37, subsection 2, Code 1995, is
 63 15 amended to read as follows:
 63 16    2.  The board shall include in the transition plan or other
 63 17 transition documents, provisions to facilitate continuity
 63 18 under sections 411.20, 411.21, and 411.30 and a recommendation
 63 19 for an equitable process for determining earnable compensation
 63 20 changes when calculating adjustments to pensions under section
 63 21 411.6, subsection 12, to be submitted to the general assembly
 63 22 meeting in 1991.
 63 23    Sec. 92.  Section 411.38, subsection 1, paragraph b,
 63 24 unnumbered paragraph 1, Code 1995, is amended to read as
 63 25 follows:
 63 26    Transfer from each terminated city fire or police
 63 27 retirement system to the statewide system amounts sufficient
 63 28 to cover the accrued liabilities of that terminated system as
 63 29 determined by the actuary of the statewide system.  The
 63 30 actuary of the statewide system shall redetermine the accrued
 63 31 liabilities of the terminated systems as necessary to take
 63 32 into account additional amounts payable by the city which are
 63 33 attributable to errors or omissions which occurred prior to
 63 34 January 1, 1992, or to matters pending as of January 1, 1992.
 63 35 If the actuary of the statewide system determines that the
 64  1 assets transferred by a terminated system are insufficient to
 64  2 fully fund the accrued liabilities of the terminated system as
 64  3 determined by the actuary as of January 1, 1992, the
 64  4 participating city shall pay to the statewide system an amount
 64  5 equal to the unfunded liability plus interest for the period
 64  6 beginning January 1, 1992, and ending with the date of payment
 64  7 or the date of entry into an amortization agreement pursuant
 64  8 to this section.  Interest on the unfunded liability shall be
 64  9 computed at a rate equal to the greater of the actuarial
 64 10 interest rate assumption on investments of the moneys in the
 64 11 fund or the actual investment earnings of the fund for the
 64 12 applicable calendar year.  The participating city may enter
 64 13 into an agreement with the statewide system to make additional
 64 14 annual contributions sufficient to amortize the unfunded
 64 15 accrued liability of the terminated system.  The terms of an
 64 16 amortization agreement shall be based upon the recommendation
 64 17 of the actuary of the statewide system, and the agreement
 64 18 shall do each of the following:
 64 19    Sec. 93.  NEW SECTION.  411.40  VOLUNTARY BENEFIT PROGRAMS.
 64 20    The board of trustees may establish voluntary benefit
 64 21 programs for members subject to the following conditions:
 64 22    1.  The voluntary benefit programs may provide benefits
 64 23 including, but not limited to, retiree health benefits, long-
 64 24 term care, and life insurance.
 64 25    2.  Participation in the voluntary benefit programs by
 64 26 members shall be voluntary.
 64 27    3.  Contributions to the voluntary benefit programs shall
 64 28 be paid entirely by each participating member by means of
 64 29 payroll deduction.  Cities employing members participating in
 64 30 voluntary benefit programs shall forward the amounts deducted
 64 31 to the board of trustees for deposit in the voluntary benefit
 64 32 fund.
 64 33    4.  The voluntary benefit programs and the voluntary
 64 34 benefit fund shall be administered under the direction of the
 64 35 board of trustees for the exclusive benefit of members paying
 65  1 contributions as provided in subsection 3.
 65  2    5.  The assets of the voluntary benefit programs shall be
 65  3 credited to the voluntary benefit fund, which is hereby
 65  4 created.  The voluntary benefit fund shall include
 65  5 contributions deposited in accordance with subsection 3, and
 65  6 any interest and earnings on the contributions.  The board of
 65  7 trustees shall annually establish an investment policy to
 65  8 govern the investment and reinvestment of the assets in the
 65  9 voluntary benefit fund.  The voluntary benefit fund created
 65 10 under this section and the fire and police retirement fund
 65 11 created under section 411.8 shall not be used to subsidize any
 65 12 portion of the liabilities of the other fund.
 65 13    6.  The board of trustees shall include in its annual
 65 14 budget the amount of money necessary during the following year
 65 15 to provide for the expense of operation of the voluntary
 65 16 benefit programs.  The operating expenses shall be paid from
 65 17 the voluntary benefit fund under the direction of the board of
 65 18 trustees.  
 65 19                           DIVISION IV
 65 20                   JUDICIAL RETIREMENT SYSTEM
 65 21    Sec. 94.  Section 602.9111, Code 1995, is amended to read
 65 22 as follows:
 65 23    602.9111  INVESTMENT OF FUND.
 65 24    So much of the judicial retirement fund as may not be
 65 25 necessary to be kept on hand for the making of disbursements
 65 26 under this article shall be invested by the treasurer of state
 65 27 in bonds or other evidences of indebtedness issued, assumed,
 65 28 or guaranteed by the United States of America, or by any
 65 29 agency or instrumentality thereof or in any investments
 65 30 authorized for the Iowa public employees' retirement system in
 65 31 section 97B.7, subsection 2, paragraph "b", and the earnings
 65 32 therefrom shall be credited to said the fund.  The treasurer
 65 33 of state may execute contracts and agreements with investment
 65 34 advisors, consultants, and investment management and benefit
 65 35 consultant firms in the administration of the judicial
 66  1 retirement fund.
 66  2    Investment management expenses shall be charged to the
 66  3 investment income of the fund and there is appropriated from
 66  4 the fund an amount required for the investment management
 66  5 expenses.  The court administrator shall report the investment
 66  6 management expenses for the fiscal year as a percent of the
 66  7 market value of the system.
 66  8    For purposes of this section, investment management
 66  9 expenses are limited to the following:
 66 10    a.  Fees for investment advisors, consultants, and
 66 11 investment management and benefit consultant firms hired by
 66 12 the treasurer of state in administering the fund.
 66 13    b.  Fees and costs for safekeeping fund assets.
 66 14    c.  Costs for performance and compliance monitoring, and
 66 15 accounting for fund investments.
 66 16    d.  Any other costs necessary to prudently invest or
 66 17 protect the assets of the fund.  The state court administrator
 66 18 and the treasurer of state, and their employees, are not
 66 19 personally liable for claims based upon an act or omission of
 66 20 the person performed in the discharge of the person's duties
 66 21 concerning the judicial retirement fund, except for acts or
 66 22 omissions which involve malicious or wanton misconduct.  
 66 23                           DIVISION V
 66 24             EFFECTIVE AND APPLICABILITY PROVISIONS
 66 25    Sec. 95.  EFFECTIVE AND RETROACTIVE APPLICABILITY DATES.
 66 26    1.  The section of this Act which amends section 97B.49,
 66 27 subsection 16, by enacting a new paragraph "m", being deemed
 66 28 of immediate importance, takes effect upon enactment and
 66 29 applies retroactively to July 1, 1992.
 66 30    2.  The section of this Act which amends section 411.6,
 66 31 subsection 12, paragraphs "a" through "c", takes effect July
 66 32 1, 1997.  
 66 33                           EXPLANATION
 66 34    This bill provides numerous changes to public retirement
 66 35 systems.  This bill may include a state mandate as defined in
 67  1 section 25B.3.  The state mandate funding requirement in
 67  2 section 25B.2, however, does not apply to public employee
 67  3 retirement systems.
 67  4    The changes to each public retirement system are as
 67  5 follows:  
 67  6        IOWA PUBLIC EMPLOYEES' RETIREMENT SYSTEM (IPERS)
 67  7    Section 97B.4 is amended to state that the department of
 67  8 personnel shall comply with applicable federal and state laws.
 67  9    Section 97B.7 is amended to provide that the department
 67 10 follow the same standards in establishing investment policy as
 67 11 are required in making particular investments for the fund.
 67 12    Section 97B.11 is amended to provide that no contributions
 67 13 shall be deducted from wages, and no membership service
 67 14 credited, from a member whose contributions for any calendar
 67 15 quarter would amount to one dollar or less.
 67 16    Section 97B.14 is amended concerning which contributions
 67 17 are forwarded to the department.  The change references the
 67 18 date established in section 97B.11A concerning the employer
 67 19 pickup of employee contributions.
 67 20    Section 97B.15 is amended to provide that the department
 67 21 may adopt interim written policies and procedures to conform
 67 22 the requirements of the retirement system with federal law
 67 23 without complying with the rulemaking requirements of chapter
 67 24 17A.
 67 25    Section 97B.17 is amended to provide that the records
 67 26 maintained by the department concerning IPERS members may be
 67 27 stored on paper, in a magnetic format, or in electronic form,
 67 28 including optical disk storage.
 67 29    The section is also amended by adding a new paragraph
 67 30 authorizing the department to release records to a
 67 31 governmental entity for the purposes of civil or criminal law
 67 32 enforcement activity.  The section further provides that the
 67 33 department is not liable for the release of records pursuant
 67 34 to this new paragraph.
 67 35    Section 97B.25 is amended to provide that a retirement
 68  1 application shall not be amended or revoked by the member once
 68  2 the first retirement allowance is paid and a member's death
 68  3 during the member's first month of entitlement shall not
 68  4 invalidate an approved application.
 68  5    Section 97B.39 is amended to provide that a member's right
 68  6 to payments under IPERS is subject to marital property orders.
 68  7 This amendment further provides that a marital property order
 68  8 shall not attempt to require payment prior to retirement or
 68  9 mandate a member's right to select certain options upon
 68 10 retirement.
 68 11    Section 97B.41, concerning definitions, is amended.
 68 12    Subsection 8, concerning the definition of employees under
 68 13 IPERS, is amended to provide that certain university
 68 14 instructors governed by the board of regents who work less
 68 15 than half-time for a school year are considered temporary
 68 16 employees and not covered by IPERS.  Currently, this reference
 68 17 applies to half-time community college instructors.
 68 18    In addition, subsection 8 is amended to provide that
 68 19 persons employed through programs provided through the Iowa
 68 20 conservation corps under chapter 15 are not employees for
 68 21 purposes of IPERS.
 68 22    New subsection 10A provides that reference to the Internal
 68 23 Revenue Code means the Internal Revenue Code as defined in
 68 24 section 422.3.
 68 25    Subsection 12, concerning the definition of membership
 68 26 service is amended to eliminate contingent language concerning
 68 27 the implementation of certain amendments to this subsection.
 68 28    New subsections 13A and 16A add two definitions concerning
 68 29 regular and special service.  Special service is defined as
 68 30 service as a member of a protected occupation,  and service as
 68 31 a county sheriff, deputy sheriff, or airport fire fighter, all
 68 32 as described in section 97B.49, subsection 16.  Regular
 68 33 service is defined as service other than special service.
 68 34    New subsection 14A defines retirement as the period of time
 68 35 from when a member has survived into the first day of the
 69  1 member's first month of entitlement until the member dies.
 69  2    Subsection 15, concerning the definition of service, is
 69  3 amended to provide that a leave of absence authorized pursuant
 69  4 to the federal Family and Medical Leave Act is deemed to be a
 69  5 leave authorized by the person's employer.
 69  6    Subsection 18, concerning the definition of three-year
 69  7 average covered wage is amended to provide that, for certain
 69  8 members who retire between January 1, 1997, and December 31,
 69  9 2003, the member's three-year average covered wage shall be
 69 10 determined on the member's wages from four to seven years if
 69 11 the member's three-year average covered wage exceeds a certain
 69 12 dollar amount for the year the member decides to retire.
 69 13    Subsection 20, concerning the definition of covered wages,
 69 14 provides that, beginning January 1, 1997, the covered wage
 69 15 limitation is eliminated subject to the amount permitted under
 69 16 the Internal Revenue Code.  Currently, the covered wage
 69 17 limitation for 1996 is $44,000 and current law provides that
 69 18 this amount will increase by $3,000 a year up to a maximum of
 69 19 $55,000, provided that the actuarial valuation of the system
 69 20 indicates that the increase can be absorbed within existing
 69 21 contribution rates.
 69 22    Section 97B.42 is amended to provide that an employee
 69 23 ceases to be an active member of IPERS if the employee
 69 24 receives service credit for service in another public
 69 25 retirement system for the same position previously covered
 69 26 under IPERS.  Current law provides that an employee shall
 69 27 cease to be an active member of IPERS upon joining another
 69 28 public retirement system maintained by public contributions.
 69 29 The bill adds similar language to a provision which currently
 69 30 prohibits a person from being a member of another public
 69 31 retirement system in the state and a member under IPERS.
 69 32    Section 97B.42 is further amended to state that an employer
 69 33 shall not make contributions on behalf of an employee to both
 69 34 IPERS and any other public retirement system in the state
 69 35 which is supported by public contributions.  Current law
 70  1 provides that a person in public employment shall not be an
 70  2 active member of both IPERS and any other public retirement
 70  3 system in the state which is supported by public
 70  4 contributions.
 70  5    Sections 97B.45 and 97B.46 are amended by striking the
 70  6 provision that a member shall not be employed as a peace
 70  7 officer or fire fighter after attaining 65 years of age.
 70  8    Section 97B.48, subsection 1, is amended to provide that a
 70  9 member who would have received a retirement allowance of less
 70 10 than $600 a year may elect to receive a lump sum equal to the
 70 11 member's and the employer's accumulated contributions and any
 70 12 retirement dividends credited before December 31, 1966.
 70 13 Current law provides that the lump sum received shall be an
 70 14 actuarial equivalent amount, defined as a benefit of equal
 70 15 value when computed pursuant to actuarial tables.
 70 16    Section 97B.48A, concerning reemployment, is amended to
 70 17 provide that for members under 65 years of age, a member's
 70 18 retirement allowance shall be reduced by 50 cents for each
 70 19 dollar the member earns over the limit for extra income
 70 20 provided in section 97B.48A.  This section of the bill also
 70 21 provides that the earned income limit is the greater of $7,440
 70 22 or the amount of income permitted under Social Security.
 70 23 Current law provides for a suspension of the retirement
 70 24 allowance for earnings over $7,440.  The section provides for
 70 25 recouping these reductions from beneficiaries of the member if
 70 26 the member dies prior to IPERS recovering the full amount of
 70 27 the reductions.
 70 28    Section 97B.49, subsection 4, is amended to provide,
 70 29 beginning January 1, 1997, that the minimum monthly benefit
 70 30 for members who retired between July 1, 1953, and July 1,
 70 31 1990, with at least 10 years of service is $200.  For each
 70 32 year of service from 10 to 30 years of total service, the
 70 33 minimum benefit shall increase by $10 per year of additional
 70 34 service.
 70 35    Section 97B.49, subsection 5, paragraph "b", is amended to
 71  1 reflect the history of the increase in the percentage
 71  2 multiplier up to the current 60 percent.  The section reflects
 71  3 that vested members retiring on or after July 1, 1994, get a
 71  4 monthly retirement allowance based on 60 percent of the
 71  5 member's three-year average covered wage.  The paragraph is
 71  6 also amended to provide that the increase in the percentage
 71  7 multiplier for years of service as provided in section 97B.49,
 71  8 subsection 5, new paragraph "e", in this bill applies to
 71  9 members covered under subsection 16 or 17 which apply to
 71 10 protection occupations, sheriffs, deputies, and airport fire
 71 11 fighters and that these members are also subject to the
 71 12 reduction in the percentage multiplier if the member's three-
 71 13 year average covered wage exceeds certain income levels.
 71 14    Section 97B.49, subsection 5 is amended by adding new
 71 15 paragraph "e" which provides that a member retiring after July
 71 16 1, 1996, gets an additional one-fourth of one percent added to
 71 17 the applicable percentage multiplier for each quarter year of
 71 18 service in addition to the number of years of service required
 71 19 for a member to receive the maximum percentage multiplier, up
 71 20 to a maximum of an additional 6 percentage points.  This
 71 21 additional percentage applies to all members under IPERS.
 71 22    Section 97B.49, subsection 13, concerning retirement
 71 23 dividends, is amended to provide for the payment of a
 71 24 retirement dividend based on a percentage of a member's
 71 25 monthly retirement allowance for certain retirees in November
 71 26 1996.  Members who retired between July 4, 1953, and December
 71 27 31, 1975, receive a dividend of 292 percent of the monthly
 71 28 benefit, members who retired between January 1, 1976, and June
 71 29 30, 1982, receive a dividend of 223 percent of the monthly
 71 30 benefit, members who retired between July 1, 1982, and June
 71 31 30, 1986, receive a dividend of 74 percent of the monthly
 71 32 benefit, and members who retired between July 1, 1986, and
 71 33 June 30, 1990, receive a dividend of 24 percent of the monthly
 71 34 benefit.
 71 35    Section 97B.49, subsection 13, concerning retirement
 72  1 dividends, is further amended by adding a new paragraph "g" to
 72  2 provide for the payment of a retirement dividend every
 72  3 November, beginning in November 1997, for members who retired
 72  4 before July 1, 1990.  The percentage applied to calculate the
 72  5 adjustment of the dividend is the lesser of 80 percent of the
 72  6 increase in the federal consumer price index, the amount the
 72  7 actuary determines the system can afford without an increase
 72  8 in contribution rates, or 3 percent.
 72  9    Section 97B.49, subsection 15, is amended to provide that a
 72 10 member retiring on or after July 1, 1996, is eligible for
 72 11 normal retirement without penalty based upon a rule of 88
 72 12 where the combination of a member's age and years of service
 72 13 equals or exceeds 88, and the member is at least 55 years of
 72 14 age.  Currently, the law provides for a rule of 92.
 72 15    Section 97B.49, subsection 16, is amended to provide that
 72 16 for members retiring on or after July 1, 1996, a county
 72 17 sheriff, deputy sheriff, or airport fire fighter may elect to
 72 18 retire at any age without a penalty after 25 years of service,
 72 19 so long as the last 12 years of service were as a sheriff,
 72 20 deputy, or fire fighter.  A sheriff, deputy, or fire fighter
 72 21 may still elect, as is provided under current law, to obtain
 72 22 full retirement at 55 years of age with 22 years of service.
 72 23    Section 97B.49, subsection 16, paragraph "d", is amended to
 72 24 add probation officer II, parole officer II, and residential
 72 25 counselor to the classifications of employees of a judicial
 72 26 district department of correctional services who are included
 72 27 within the definition of a member of a protection occupation.
 72 28    Section 97B.49, subsection 16, is amended by adding a new
 72 29 paragraph "m" requiring that the department of public safety
 72 30 shall pay the department of personnel the costs of additional
 72 31 benefits provided a fire protection inspector peace officer.
 72 32 This provision is immediately effective and retroactive to
 72 33 July 1, 1992.
 72 34    Section 97B.49 is amended to add a new subsection 17 that
 72 35 establishes a hybrid retirement formula to be used in
 73  1 computing the retirement allowance for members who earned
 73  2 service as a regular IPERS member and who earned service as a
 73  3 member of a protection occupation or a county sheriff, deputy
 73  4 sheriff, or airport fire fighter.
 73  5    New section 97B.50A is added to provide for a disability
 73  6 retirement allowance for members of a protection occupation or
 73  7 a county sheriff, deputy sheriff, or airport fire fighter,
 73  8 effective January 1, 1997.  The section provides for a monthly
 73  9 accidental disability benefit equal to 1/12 of 33 1/3 percent
 73 10 of the member's three-year average covered wage.  Accidental
 73 11 disability is based on job-related injury or disease.  The
 73 12 section provides that certain heart and lung diseases qualify
 73 13 an eligible member for an accidental disability.  The section
 73 14 also establishes a medical board and provides for the medical
 73 15 reexamination of certain disabled retirees.
 73 16    Section 97B.51 is amended to provide that a member shall
 73 17 not change an election of an optional retirement allowance
 73 18 once the first retirement allowance is paid.
 73 19    Section 97B.51, subsection 5, provides that a member may
 73 20 elect, at retirement, to provide a lump sum payment to a
 73 21 beneficiary on the member's death.  This section of the bill
 73 22 provides that the lump sum payment shall not exceed the
 73 23 member's accumulated contributions.  Current law does not
 73 24 specify that the lump sum payment cannot exceed the member's
 73 25 accumulated contributions.
 73 26    Section 97B.51, subsection 6, is amended to provide for an
 73 27 equal distribution of a member's reduced retirement allowance
 73 28 payments upon the member's death if multiple beneficiaries are
 73 29 designated unless the member provides in writing for a
 73 30 different distribution.
 73 31    Section 97B.52 is amended to provide that payment to a
 73 32 member's beneficiary, if the member dies prior to the member's
 73 33 first month of entitlement, is calculated based on years of
 73 34 service divided by 22, 25, or 30, depending upon the member's
 73 35 last membership service.
 74  1    Section 97B.52, subsection 3, is amended to provide that a
 74  2 beneficiary, heirs, or the estate, have five years, and not
 74  3 two years, after the member's death to apply to the department
 74  4 to receive the member's death benefit.  The section of the
 74  5 bill also requires the department to reinstate a surviving
 74  6 spouse's right to receive a death benefit after five years if
 74  7 required or permitted pursuant to the Internal Revenue Code.
 74  8    Section 97B.52, subsection 5, is amended to provide for the
 74  9 payment of benefits that are waived by the eligible
 74 10 beneficiary.
 74 11    Section 97B.52A is amended to provide that a member does
 74 12 not have a bona fide retirement until all employment with the
 74 13 employer, even noncovered employment, is terminated for at
 74 14 least 30 days.
 74 15    Section 97B.53 is amended to eliminate contingent language
 74 16 concerning the implementation of amendments to this section.
 74 17    Section 97B.53B is amended to provide that annual
 74 18 distributions of less than $200 of taxable income are not
 74 19 considered an eligible rollover distribution.  Current law
 74 20 refers to a distribution of less than $200 of taxable income.
 74 21    Section 97B.66 is amended to provide that members may make
 74 22 contributions as "buy-backs" in increments of calendar
 74 23 quarters rather than full years concerning former service in
 74 24 the teachers insurance and annuity association-college
 74 25 retirement equity fund (TIAA-CREF).  This section also
 74 26 eliminates contingency language concerning the implementation
 74 27 of partial "buy-backs", and contains a conforming change
 74 28 pertaining to interest accrual under section 97B.70.
 74 29    Section 97B.68 is amended to provide that a member of a
 74 30 federal retirement system is not eligible for membership in
 74 31 IPERS for the same position.  Current law prohibits membership
 74 32 in both systems regardless of the position.
 74 33    Section 97B.68 is amended by adding a new subsection 3 to
 74 34 provide that effective July 1, 1996, employees under the
 74 35 federal retirement system may be covered under IPERS if
 75  1 service under IPERS is not counted for their federal system
 75  2 retirement.
 75  3    Section 97B.70 is amended to provide that, effective for
 75  4 years beginning January 1997, the interest credited to the
 75  5 member's and the employer's contributions for purposes of
 75  6 determining the accumulated contributions shall be equal to 1
 75  7 percent higher than the interest rate for one year
 75  8 certificates of deposit as of January of each year.  This
 75  9 section also provides that interest shall be credited on a
 75 10 quarterly basis, and removes contingency language.
 75 11    Sections 97B.72, concerning members of the general assembly
 75 12 or after the 71st General Assembly, 97B.72A, concerning
 75 13 members of the general assembly before July 1, 1988, 97B.73,
 75 14 for members of other public retirement systems, and 97B.73A,
 75 15 concerning part-time county attorneys, are amended to provide
 75 16 that members may make contributions in increments of calendar
 75 17 quarters rather than full years concerning former service.
 75 18 The sections also eliminate contingency language concerning
 75 19 the implementation of partial "buy-ins", or "buy-backs", as
 75 20 applicable, and contain conforming change pertaining to
 75 21 interest accrual under section 97B.70.  Section 97B.72A is
 75 22 also amended to provide that only vested or retired members,
 75 23 and not active members, may make contributions.
 75 24    Section 97B.74 is amended to provide that members may make
 75 25 contributions as "buy-backs" in increments of calendar
 75 26 quarters rather than full years concerning members seeking
 75 27 reinstatement as a vested member.  The section also provides
 75 28 that only former vested or retired members, and not former
 75 29 active members who were not vested, can buy back refunds
 75 30 received.  The section also eliminates contingent language
 75 31 concerning the implementation of amendments to this Code
 75 32 section.
 75 33    Section 97B.80 is amended to provide that members may make
 75 34 contributions as "buy-ins" in increments of one or more
 75 35 calendar quarters rather than full years for active duty
 76  1 service in the armed forces.  The section eliminates the
 76  2 restriction on making contributions in increments of less than
 76  3 one year only once.  
 76  4            PUBLIC SAFETY PEACE OFFICERS' RETIREMENT,
 76  5                 ACCIDENT, AND DISABILITY SYSTEM
 76  6    Sections 97A.5, 97A.6, and 97A.8 are amended to provide
 76  7 that the board of trustees shall, upon the advice of an
 76  8 actuary hired by the board, make the necessary valuations for
 76  9 determining the contribution rate into the fund.  Currently,
 76 10 the commissioner of insurance is given the responsibility to
 76 11 perform these functions.
 76 12    Section 97A.5 is further amended to provide that the board
 76 13 of trustees may hire investment and benefit advisors and
 76 14 consultants in order to administer the system.  The section is
 76 15 also amended to provide that the department of public safety,
 76 16 the board of trustees, and the treasurer of state shall not be
 76 17 liable for their actions that do not constitute malicious or
 76 18 wanton misconduct, even if the actions violate standards
 76 19 established in section 97A.7.
 76 20    Section 97A.6, subsection 2, is amended to increase, from
 76 21 .6 percent to 1.5 percent the additional benefit for members
 76 22 for each additional year of service in the system from 22 to
 76 23 30 years of service for members terminating service on or
 76 24 after July 1, 1996.
 76 25    Section 97A.6, subsection 12, is amended to increase the
 76 26 minimum benefit for surviving spouses of members from 20
 76 27 percent to 25 percent of the compensation for a senior patrol
 76 28 officer.
 76 29    Section 97A.6, subsection 14, is amended to provide for an
 76 30 increase in the percentages used to provide an annual
 76 31 readjustment of the pension payable from the current 12.5
 76 32 percent and 25 percent to 15 percent and 30 percent,
 76 33 respectively.  Currently, only those members who retired prior
 76 34 to July 1, 1990, get the higher percentage readjustment.  The
 76 35 bill also provides that a retired member is eligible for this
 77  1 readjustment if the member served 22 years.  Currently, a
 77  2 member must serve 22 years and attain the age of 55 years
 77  3 before retirement in order to be eligible for the
 77  4 readjustment.
 77  5    Section 97A.6 is amended by adding a new subsection
 77  6 providing for early retirement benefits for members who retire
 77  7 between the ages of 50 and 55 years but who have 22 years of
 77  8 service.  The member's benefit will be reduced by an amount
 77  9 for each month of early retirement to reflect the actuarial
 77 10 cost, so that the early retirement does not result in any
 77 11 increase in cost to the system.
 77 12    Section 97A.8, subsection 1, is amended to eliminate the
 77 13 requirement that, beginning July 1, 1996, the normal
 77 14 contribution rate and the members contribution rate be
 77 15 equivalent to the respective rates provided under the
 77 16 statewide fire and police retirement system.  Instead, these
 77 17 sections provide for establishing both rates based on the
 77 18 costs associated with the peace officers' retirement system,
 77 19 subject to certain existing limitations.
 77 20    Section 97A.8, subsection 3, is amended to specify which
 77 21 investment management expenses may be paid for by the expense
 77 22 fund established for the system.
 77 23    Section 97A.12 is amended to provide that a member's
 77 24 pension under the system is subject to assignment based on a
 77 25 marital property order or a child, spousal, or medical support
 77 26 order.
 77 27    New section 97A.17 establishes a mechanism for allowing
 77 28 vested members of the system and vested members of the
 77 29 statewide fire and police retirement system established in
 77 30 chapter 411 to transfer to the other system with credit for
 77 31 the period of service in the former system.  The section
 77 32 permits a member who transferred to the other system before
 77 33 the effective date of this section to transfer credit from the
 77 34 former system to the current system within one year from the
 77 35 effective date of this section.  
 78  1           STATEWIDE FIRE AND POLICE RETIREMENT SYSTEM
 78  2    Section 400.8 is amended to authorize the board of trustees
 78  3 of the statewide fire and police retirement system to update
 78  4 the medical protocols used for examining applicants for
 78  5 employment as a police officer or fire fighter.
 78  6    Section 411.5 is amended to provide that the board of
 78  7 trustees is given the authority to take any necessary action
 78  8 to administer the voluntary benefit programs established in
 78  9 new section 411.40.
 78 10    Section 411.6, subsection 12, is amended to replace the
 78 11 current method for annually readjusting the pensions of
 78 12 members of the system effective July 1, 1997.  The bill
 78 13 provides that the monthly pensions of members shall be
 78 14 adjusted each July 1 by adding an amount to the pension that
 78 15 represents an increase of 1.5 percent over the previous year's
 78 16 monthly pension plus a set dollar amount based on the number
 78 17 of years the member has been retired.  This section provides
 78 18 that a retired member must be retired on or before the
 78 19 effective date of the pension readjustment to be eligible for
 78 20 the readjustment.
 78 21    Section 411.31 is amended to provide that a member's
 78 22 pension under the system is subject to assignment based on a
 78 23 marital property order or a child, spousal, or medical support
 78 24 order.
 78 25    New section 411.31 establishes a mechanism for allowing
 78 26 vested members of the system and vested members of the public
 78 27 safety peace officers', accident and disability system in
 78 28 chapter 97A to transfer to the other system with credit for
 78 29 the period of service in the former system.  The section
 78 30 permits a member who transferred to the other system before
 78 31 the effective date of this section to transfer credit from the
 78 32 former system to the current system within one year from the
 78 33 effective date of this section.
 78 34    Section 411.38 is amended to establish a mechanism to
 78 35 charge participating cities in the system with the unfunded
 79  1 liability of that city along with interest calculated based on
 79  2 the investment performance or actuarial assumptions of the
 79  3 system.
 79  4    New section 411.40 establishes voluntary benefit programs
 79  5 for members of the system.  The board of trustees is
 79  6 authorized to establish programs for the benefit of members,
 79  7 to include retiree health, long-term care, and life insurance.
 79  8 The section establishes a voluntary benefit fund for the
 79  9 purpose of investing assets transferred to the fund from
 79 10 employee contributions.  Participation in the program by
 79 11 members is voluntary.  
 79 12                   JUDICIAL RETIREMENT SYSTEM
 79 13    Section 602.9111 is amended to provide that the state
 79 14 treasurer may hire investment and benefit advisors and
 79 15 consultants in order to administer the system and is amended
 79 16 to provide for what investment management expenses may be paid
 79 17 for from the judicial retirement fund.  The bill provides that
 79 18 the state court administrator and the treasurer of state shall
 79 19 not be liable for their actions concerning the fund that do
 79 20 not constitute malicious or wanton misconduct even if the
 79 21 actions violate standards established for the fund.  
 79 22 LSB 3538SC 76
 79 23 ec/cf/24.1
     

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