Text: SSB01246 Text: SSB01248 Text: SSB01200 - SSB01299 Text: SSB Index Bills and Amendments: General Index Bill History: General Index
PAG LIN 1 1 Section 1. Section 12.8, unnumbered paragraph 3, Code 1 2 2001, is amended to read as follows: 1 3 The treasurer of state, with the approval of the investment 1 4 board of the Iowa public employees' retirement system, may 1 5 conduct a program of lending securities in the Iowa public 1 6 employees' retirement system portfolio. When securities are 1 7 loaned as provided by this paragraph, the treasurer shall act 1 8 in the manner provided for investment of moneys in the Iowa 1 9 public employees' retirement fund under section97B.797B.7A. 1 10 The treasurer of state shall report at least annually to the 1 11 investment board of the Iowa public employees' retirement 1 12 system on the program and shall provide additional information 1 13 on the program upon the request of the investment board or the 1 14 employees of the Iowa public employees' retirement system 1 15 division of the department of personnel. 1 16 Sec. 2. Section 12B.10, subsection 4, paragraph f, Code 1 17 2001, is amended to read as follows: 1 18 f. Investments authorized for the Iowa public employees' 1 19 retirement system in section97B.7, subsection 2, paragraph1 20"b"97B.7A, except that investment in common stocks is not 1 21 permitted. 1 22 Sec. 3. Section 12C.5, Code 2001, is amended to read as 1 23 follows: 1 24 12C.5 REFUSAL OF DEPOSITS – PROCEDURE. 1 25 If the approved depositories will not accept the deposits 1 26 under the conditions prescribed or authorized in this chapter, 1 27 the funds may be deposited, on the same or better terms as 1 28 were offered to the depositories, in one or more approved 1 29 depositories conveniently located within the state. 1 30 The treasurer of state may invest in any of the investments 1 31 authorized for the Iowa public employees' retirement system in 1 32 section97B.7, subsection 2, paragraph "b"97B.7A except that 1 33 investment in common stocks shall not be permitted. 1 34 Sec. 4. Section 12C.10, Code 2001, is amended to read as 1 35 follows: 2 1 12C.10 INVESTMENT OF FUNDS CREATED BY ELECTION. 2 2 The governing council or board, who by law have control of 2 3 any fund created by direct vote of the people, may invest any 2 4 portion of the fund not currently needed, in investments 2 5 authorized in section 12B.10. The treasurer of state may 2 6 invest in any of the investments authorized for the Iowa 2 7 public employees' retirement system in section97B.7,2 8subsection 2, paragraph "b"97B.7A except that investment in 2 9 common stocks shall not be permitted. Interest or earnings on 2 10 such funds shall be credited as provided in section 12C.7, 2 11 subsection 2. 2 12 Sec. 5. Section 19A.1, subsection 3, paragraph b, Code 2 13 2001, is amended to read as follows: 2 14 b. The investment board of the Iowa public employees' 2 15 retirement system created by section97B.897B.8A. 2 16 Sec. 6. Section 97A.7, subsection 2, Code 2001, is amended 2 17 to read as follows: 2 18 2. The several funds created by this chapter may be 2 19 invested in any investments authorized for the Iowa public 2 20 employees' retirement system in section97B.7, subsection 2,2 21paragraph "b"97B.7A. 2 22 Sec. 7. Section 97B.1, Code 2001, is amended to read as 2 23 follows: 2 24 97B.1 SYSTEM CREATED – ORGANIZATIONAL DEFINITIONS. 2 25 1. The "Iowa Public Employees' Retirement System" is 2 26 created. The Iowa public employees' retirement systemis2 27 division, a separate and distinct division within the 2 28 department of personnel, shall administer the system. 2 29 2. As used in this chapter unless the context requires 2 30 otherwise: 2 31 a. "Board" means the investment board created by section 2 3297B.897B.8A. 2 33 b. "Chief executive officer" means the chief executive 2 34 officer of the Iowa public employees' retirement system 2 35 division, notwithstanding section 7E.2, subsection 3, 3 1 paragraph "c", subparagraph (1). 3 2 c. "Committee" means the benefits advisory committee 3 3 created by section 97B.8B. 3 4b.d. "DepartmentDivision" means thedepartment of3 5personnelIowa public employees' retirement system division. 3 6c. "Director" means the director of the department of3 7personnel.3 8d.e. "System" means the Iowa public employees' retirement 3 9 system. 3 10 Sec. 8. NEW SECTION. 97B.3A CHIEF EXECUTIVE OFFICER – 3 11 APPOINTMENT AND QUALIFICATIONS. 3 12 1. The administrator of the division is the chief 3 13 executive officer. The chief executive officer shall be 3 14 appointed by the governor subject to confirmation by the 3 15 senate and shall serve at the pleasure of the governor. 3 16 2. The qualifications for appointment as the chief 3 17 executive officer shall include a demonstrated knowledge of 3 18 and executive-level experience in all aspects of pension fund 3 19 administration, including financial management, investment 3 20 asset management, benefit design and delivery, legal 3 21 administration, and operations administration. The chief 3 22 executive officer shall not be selected on the basis of 3 23 political affiliation, and while employed as the chief 3 24 executive officer, shall not be a member of a political 3 25 committee, participate in a political campaign, or be a 3 26 candidate for a partisan elective office, and shall not 3 27 contribute to a political campaign fund, except that the chief 3 28 executive officer may designate on the checkoff portion of the 3 29 state or federal income tax return, or both, a party or 3 30 parties to which a contribution is made pursuant to the 3 31 checkoff. The chief executive officer shall not hold any 3 32 other office under the laws of the United States or of this or 3 33 any state and shall devote full time to the duties of office. 3 34 Sec. 9. Section 97B.4, Code 2001, is amended by striking 3 35 the section and inserting in lieu thereof the following: 4 1 97B.4 ADMINISTRATION OF SYSTEM – POWERS AND DUTIES OF 4 2 DIVISION – IMMUNITY. 4 3 1. CHIEF EXECUTIVE OFFICER. The division, through the 4 4 chief executive officer, shall administer this chapter. The 4 5 chief executive officer shall also be the division's statutory 4 6 designee with respect to the rulemaking power. 4 7 2. GENERAL AUTHORITY. 4 8 a. The division may adopt, amend, waive, or rescind rules, 4 9 employ persons, execute contracts with outside parties, make 4 10 expenditures, require reports, make investigations, and take 4 11 other action it deems necessary for the administration of the 4 12 system in conformity with the requirements of this chapter, 4 13 the applicable provisions of the Internal Revenue Code, and 4 14 all other applicable federal and state laws. The rules shall 4 15 be effective upon compliance with chapter 17A. 4 16 b. The division may delegate to any person such authority 4 17 as it deems reasonable and proper for the effective 4 18 administration of this chapter, and may bond any person 4 19 handling moneys or signing checks under this chapter. 4 20 c. In administering this chapter, the division shall enter 4 21 into a biennial agreement with the department of personnel 4 22 concerning the sharing of resources between the division and 4 23 department which are of benefit to each and which are 4 24 consistent with the mission of the division and the 4 25 department. The budget program for the division shall be 4 26 compiled by the department of personnel in collaboration with 4 27 the division and submitted by the department pursuant to 4 28 section 8.23. 4 29 3. PERSONNEL. 4 30 a. CHIEF INVESTMENT OFFICER. The chief executive officer, 4 31 following consultation with the board, shall employ a chief 4 32 investment officer who shall be appointed pursuant to chapter 4 33 19A and shall be responsible for administering the investment 4 34 program for the retirement fund pursuant to the investment 4 35 policies of the board. 5 1 b. CHIEF BENEFITS OFFICER. The chief executive officer, 5 2 following consultation with the benefits advisory committee, 5 3 shall employ a chief benefits officer who shall be appointed 5 4 pursuant to chapter 19A and shall be responsible for 5 5 administering the benefits and other services provided under 5 6 the system. 5 7 c. ACTUARY. The division shall employ an actuary who 5 8 shall be selected by the board and shall serve at the pleasure 5 9 of the board. The actuary shall be the technical advisor for 5 10 the system on matters regarding the operation of the 5 11 retirement fund. 5 12 d. DIVISION EMPLOYEES. Subject to other provisions of 5 13 this chapter, the division may employ all other personnel as 5 14 necessary for the administration of the system. The maximum 5 15 number of full-time equivalent employees specified by the 5 16 general assembly for the division for administration of the 5 17 system for a fiscal year shall not be reduced by any authority 5 18 other than the general assembly. The personnel of the 5 19 division shall be appointed pursuant to chapter 19A. The 5 20 division shall not appoint or employ a person who is an 5 21 officer or committee member of a political party organization 5 22 or who holds or is a candidate for a partisan elective public 5 23 office. 5 24 e. LEGAL ADVISORS. The division may employ attorneys and 5 25 contract with attorneys and legal firms for the provision of 5 26 legal counsel and advice in the administration of this chapter 5 27 and chapter 97C. 5 28 f. OUTSIDE ADVISORS. The division may execute contracts 5 29 with persons outside state government, including investment 5 30 advisors, consultants, and managers, in the administration of 5 31 this chapter. However, a contract with an investment manager 5 32 or investment consultant shall not be executed by the division 5 33 pursuant to this paragraph without the prior approval by the 5 34 board of the hiring of the investment manager or investment 5 35 consultant. 6 1 4. REPORTS. 6 2 a. ANNUAL REPORT TO GOVERNOR. Not later than the 6 3 fifteenth day of December of each year, the division shall 6 4 submit to the governor a report covering the administration 6 5 and operation of this chapter during the preceding fiscal year 6 6 and shall make recommendations for amendments to this chapter. 6 7 The report shall include a balance sheet of the moneys in the 6 8 retirement fund. The report shall also include information 6 9 concerning the investment management expenses for the 6 10 retirement fund for each fiscal year expressed as a percent of 6 11 the market value of the retirement fund investment assets, 6 12 including the information described in section 97B.7, 6 13 subsection 3, paragraph "d". The information provided under 6 14 this paragraph shall also include information on the 6 15 investment policies and investment performance of the 6 16 retirement fund. In providing this information, to the extent 6 17 possible, the division shall include the total investment 6 18 return for the entire fund, for portions of the fund managed 6 19 by investment managers, and for internally managed portions of 6 20 the fund, and the cost of managing the fund per thousand 6 21 dollars of assets. The performance shall be based upon market 6 22 value, and shall be contrasted with relevant market indices 6 23 and with performances of pension funds of similar asset size. 6 24 b. ANNUAL STATEMENT TO MEMBERS. The division shall 6 25 prepare and distribute to the members, at the expense of the 6 26 retirement fund, an annual statement of the member's account 6 27 and, in such a manner as the division deems appropriate, other 6 28 information concerning the system. 6 29 c. ACTUARIAL INVESTIGATION. During calendar year 2002, 6 30 and every four years thereafter, the division shall cause an 6 31 actuarial investigation to be made of all experience under the 6 32 retirement system. Pursuant to such an investigation, the 6 33 division shall, from time to time, determine upon an actuarial 6 34 basis the condition of the system and shall report to the 6 35 general assembly its findings and recommendations. 7 1 d. ANNUAL VALUATION OF ASSETS. The division shall cause 7 2 an annual actuarial valuation to be made of the assets and 7 3 liabilities of the system and shall prepare an annual 7 4 statement of the amounts to be contributed under this chapter, 7 5 and shall publish annually such valuation of the assets and 7 6 liabilities and the statement of receipts and disbursements of 7 7 the system. Based upon the actuarial methods and assumptions 7 8 adopted by the board for the annual valuation, the division 7 9 shall certify to the governor the contribution rates 7 10 determined thereby as the rates necessary and sufficient for 7 11 members and employers to fully fund the benefits and 7 12 retirement allowances being credited. 7 13 5. INVESTMENTS. The division, through the chief 7 14 investment officer, shall invest, in accordance with the 7 15 investment policy and goal statement established by the board, 7 16 the portion of the retirement fund which, in the judgment of 7 17 the division, is not needed for current payment of benefits 7 18 under this chapter subject to the requirements of section 7 19 97B.7A. 7 20 6. OLD RECORDS. The division may destroy or dispose of 7 21 such original reports or records as have been properly 7 22 recorded or summarized in the permanent records of the 7 23 division and are deemed by the chief executive officer to be 7 24 no longer necessary to the proper administration of this 7 25 chapter. The destruction or disposition shall be made only by 7 26 order of the chief executive officer. Records of deceased 7 27 members of the system may be destroyed ten years after the 7 28 later of the final payment made to a third party on behalf of 7 29 the member or the death of the member. Any moneys received 7 30 from the disposition of these records shall be deposited to 7 31 the credit of the retirement fund subject to rules adopted by 7 32 the division. 7 33 7. IMMUNITY. The division, employees of the division, the 7 34 board, the members of the board, and the treasurer of state 7 35 are not personally liable for actions or omissions under this 8 1 chapter that do not involve malicious or wanton misconduct 8 2 even if those actions or omissions violate the standards 8 3 established in section 97B.7A. 8 4 Sec. 10. Section 97B.7, Code 2001, is amended by striking 8 5 the section and inserting in lieu thereof the following: 8 6 97B.7 FUND CREATED – EXCLUSIVE BENEFIT – STANDING 8 7 APPROPRIATIONS. 8 8 1. There is hereby created as a special fund, separate and 8 9 apart from all other public moneys or funds of this state, the 8 10 "Iowa Public Employees' Retirement Fund", hereafter called the 8 11 "retirement fund". The retirement fund shall consist of all 8 12 moneys collected under this chapter, together with all 8 13 interest, dividends, and rents thereon, and shall also include 8 14 all securities or investment income and other assets acquired 8 15 by and through the use of the moneys belonging to the 8 16 retirement fund and any other moneys that have been paid into 8 17 the retirement fund. 8 18 2. The treasurer of the state of Iowa is hereby made the 8 19 custodian of the retirement fund and shall hold and disburse 8 20 the retirement fund in accordance with the requirements of 8 21 this chapter. As custodian, the treasurer shall be authorized 8 22 to disburse moneys in the retirement fund upon warrants drawn 8 23 by the director of revenue and finance pursuant to the order 8 24 of the division. 8 25 3. All moneys which are paid or deposited into the fund 8 26 are appropriated and made available to the division to be used 8 27 for the exclusive benefit of the members and their 8 28 beneficiaries or contingent annuitants as provided in this 8 29 chapter: 8 30 a. To be used by the division for the payment of claims 8 31 for benefits under this chapter. 8 32 b. To be used by the division to pay refunds provided for 8 33 in this chapter. 8 34 c. To be used for the costs of administering the system, 8 35 including up to $50,000 per fiscal year for actual and 9 1 necessary expenses of the benefits advisory committee. If as 9 2 a result of action under section 8.31, the governor has 9 3 reduced the moneys appropriated from the retirement fund to 9 4 the division for salaries, support, maintenance, and other 9 5 operational purposes to pay the costs of the system for a 9 6 fiscal year, it is the intent of the general assembly that the 9 7 amount by which the appropriation has been reduced should be 9 8 transferred from the retirement fund to the division for 9 9 salaries, support, maintenance, and other operational purposes 9 10 to pay the costs of the system for that fiscal year. 9 11 d. To be used to pay for investment management expenses 9 12 incurred in the management of the retirement fund. Expenses 9 13 incurred pursuant to this paragraph shall be charged to the 9 14 investment income of the retirement fund. However, the amount 9 15 appropriated for a fiscal year under this paragraph shall not 9 16 exceed four-tenths of one percent of the market value of the 9 17 retirement fund. 9 18 Sec. 11. NEW SECTION. 97B.7A INVESTMENT AND MANAGEMENT 9 19 OF RETIREMENT FUND – STANDARDS – IMMUNITY. 9 20 1. INVESTMENT AND INVESTMENT POLICY STANDARDS. In 9 21 establishing the investment policy of the retirement fund and 9 22 providing for the investment of the retirement fund, the 9 23 division and board shall do the following: 9 24 a. Exercise the judgment and care, under the circumstances 9 25 then prevailing, which persons of prudence, discretion, and 9 26 intelligence exercise in the management of their own affairs, 9 27 not for the purpose of speculation, but with regard to the 9 28 permanent disposition of the funds, considering the probable 9 29 income, as well as the probable safety, of their capital. 9 30 b. Give appropriate consideration to those facts and 9 31 circumstances that the division and board know or should know 9 32 are relevant to the particular investment or investment policy 9 33 involved, including the role the investment plays in the total 9 34 value of the retirement fund. 9 35 c. For the purposes of this subsection, appropriate 10 1 consideration includes, but is not limited to, a determination 10 2 that the particular investment or investment policy is 10 3 reasonably designed to further the purposes of the system, 10 4 taking into consideration the risk of loss and the opportunity 10 5 for gain or income associated with the investment or 10 6 investment policy and consideration of the following factors 10 7 as they relate to the retirement fund: 10 8 (1) The composition of the retirement fund with regard to 10 9 diversification. 10 10 (2) The liquidity and current return of the investments in 10 11 the retirement fund relative to the anticipated cash flow 10 12 requirements of the system. 10 13 (3) The projected return of the investments relative to 10 14 the funding objectives of the retirement system. 10 15 2. INVESTMENT ACQUISITIONS. Within the limitations of the 10 16 investment standards prescribed in this section, the system 10 17 may acquire and retain every kind of property and every kind 10 18 of investment which persons of prudence, discretion, and 10 19 intelligence acquire or retain for their own account. 10 20 Consistent with this section, investments shall be made in a 10 21 manner that will enhance the economy of this state, and in 10 22 particular, will result in increased employment of the 10 23 residents of this state. Investments of moneys in the 10 24 retirement fund are not subject to sections 73.15 through 10 25 73.21. 10 26 3. LIABILITY – REIMBURSEMENT. Except as provided in 10 27 section 97B.4, subsection 7, if there is loss to the 10 28 retirement fund, the treasurer of state, the division, the 10 29 employees of the division, the members of the board severally, 10 30 and the board are not personally liable, and the loss shall be 10 31 charged against the retirement fund. There is appropriated 10 32 from the retirement fund, the amount required to cover a loss. 10 33 4. INVESTMENT PROCEDURES. In managing the investment of 10 34 the retirement fund, the division, in accordance with the 10 35 investment policy established by the board, is authorized to 11 1 do the following: 11 2 a. To sell any securities or other property in the 11 3 retirement fund and reinvest the proceeds when such action may 11 4 be deemed advisable by the division for the protection of the 11 5 retirement fund or the preservation of the value of the 11 6 investment. Such sale of securities or other property of the 11 7 retirement fund and reinvestment shall only be made in 11 8 accordance with policies of the board in the manner and to the 11 9 extent provided in this chapter. 11 10 b. To subscribe for the purchase of securities for future 11 11 delivery in anticipation of future income. The securities 11 12 shall be paid for by anticipated income or from funds from the 11 13 sale of securities or other property held by the retirement 11 14 fund. 11 15 c. To pay for securities directed to be purchased upon the 11 16 receipt of the purchasing bank's paid statement or paid 11 17 confirmation of purchase. 11 18 5. TRAVEL. In the administration of the investment of 11 19 moneys in the retirement fund, employees of the division and 11 20 members of the board may travel outside the state for the 11 21 purpose of meeting with investment firms and consultants and 11 22 attending conferences and meetings to fulfill their fiduciary 11 23 responsibilities. This travel is not subject to section 11 24 421.38, subsection 2. 11 25 Sec. 12. NEW SECTION. 97B.8A INVESTMENT BOARD. 11 26 1. BOARD ESTABLISHED. A board is established to be known 11 27 as the "Investment Board of the Iowa Public Employees' 11 28 Retirement System", referred to in this chapter as the 11 29 "board". The duties of the board are to establish policy, and 11 30 review its implementation, in matters relating to the 11 31 investment of the retirement fund. The board shall be the 11 32 trustee of the retirement fund. 11 33 2. INVESTMENT REVIEW. a. At least annually the board 11 34 shall review the investment policies and procedures used by 11 35 the board and division, and shall hold a public meeting on the 12 1 investment policies and investment performance of the 12 2 retirement fund. Following its review and the public meeting, 12 3 the board shall, pursuant to the requirements of section 12 4 97B.7A, and in consultation with the chief investment officer 12 5 and other relevant personnel of the division, establish an 12 6 investment policy and goal statement that shall direct the 12 7 investment activities concerning the retirement fund. 12 8 b. The board shall review and approve, prior to the 12 9 execution of a contract with the division, the hiring of each 12 10 investment manager and investment consultant outside of state 12 11 government. 12 12 c. The board shall be involved in the performance 12 13 evaluation of the chief investment officer. 12 14 3. ACTUARIAL RESPONSIBILITIES. 12 15 a. The board shall select the actuary to be employed by 12 16 the system as provided in section 97B.4. 12 17 b. The board shall, in consultation with the chief 12 18 executive officer, the actuary, and other relevant personnel 12 19 of the division, adopt from time to time mortality tables and 12 20 all other necessary factors for use in actuarial calculations 12 21 required in connection with the system. The board shall also 12 22 adopt the actuarial methods and assumptions to be used by the 12 23 actuary for the annual valuation of assets as required by 12 24 section 97B.4. 12 25 4. MEMBERSHIP. 12 26 a. The board shall consist of nine members, including 12 27 seven voting members and two nonvoting members. The voting 12 28 members shall be as follows: 12 29 (1) Three public members, appointed by the governor, who 12 30 are not members of the system and who each have substantial 12 31 institutional investment experience or substantial 12 32 institutional financial experience. 12 33 (2) Three members, appointed by the governor, who are 12 34 members of the system. Of the three members appointed, one 12 35 shall be an active member who is an employee of a school 13 1 district, area education agency, or merged area; one shall be 13 2 an active member who is not an employee of a school district, 13 3 area education agency, or merged area; and one shall be a 13 4 retired member of the system. 13 5 (3) The treasurer of state. 13 6 The nonvoting members of the board shall be one state 13 7 representative, appointed by the speaker of the house of 13 8 representatives, and one state senator, appointed by the 13 9 president of the senate, after consultation with the majority 13 10 leader and the minority leader of the senate. 13 11 b. Four voting members of the board shall constitute a 13 12 quorum. 13 13 c. The three members who have substantial institutional 13 14 investment experience or substantial institutional financial 13 15 experience, and the member who is a retired member of the 13 16 system, shall be paid their actual expenses incurred in the 13 17 performance of their duties and shall receive a per diem as 13 18 specified in section 7E.6 for each day of service not 13 19 exceeding forty days per year. Legislative members shall be 13 20 paid the per diem and expenses specified in section 2.10, for 13 21 each day of service. The per diem and expenses of the 13 22 legislative members shall be paid from funds appropriated 13 23 under section 2.12. The members who are active members of the 13 24 system and the treasurer of state shall be paid their actual 13 25 expenses incurred in the performance of their duties as 13 26 members of the board and the performance of their duties as 13 27 members of the board shall not affect their salaries, 13 28 vacations, or leaves of absence for sickness or injury. 13 29 d. The appointive terms of the members appointed by the 13 30 governor are for a period of six years beginning and ending as 13 31 provided in section 69.19. If there is a vacancy in the 13 32 membership of the board for one of the members appointed by 13 33 the governor, the governor has the power of appointment. 13 34 Gubernatorial appointees to this board are subject to 13 35 confirmation by the senate. 14 1 5. CLOSED SESSIONS. In addition to the reasons provided 14 2 in section 21.5, subsection 1, the board may hold a closed 14 3 session pursuant to the requirements of section 21.5 of that 14 4 portion of a board meeting in which financial or commercial 14 5 information is provided to or discussed by the board if the 14 6 board determines that disclosure of such information could 14 7 result in a loss to the system or to the provider of the 14 8 information. 14 9 Sec. 13. NEW SECTION. 97B.8B BENEFITS ADVISORY 14 10 COMMITTEE. 14 11 1. COMMITTEE ESTABLISHED. A benefits advisory committee 14 12 shall be established whose duty is to consider and make 14 13 recommendations to the division and the general assembly 14 14 concerning the provision of benefits to members of the system. 14 15 2. MEMBERSHIP. The benefits advisory committee shall be 14 16 comprised of representatives of constituent groups concerned 14 17 with the system, and shall include representatives of 14 18 employers, active members, and retired members. In addition, 14 19 the director of the department of personnel and a member of 14 20 the public selected by the voting members of the committee 14 21 shall serve as members of the committee. The division shall 14 22 adopt rules under chapter 17A to provide for the selection of 14 23 members to the committee and the election of the voting 14 24 members of the committee. 14 25 3. VOTING MEMBERS. Of the members who comprise the 14 26 committee, nine members shall be voting members. Except as 14 27 otherwise provided by this subsection, the voting members 14 28 shall be elected by the members of the committee from the 14 29 membership of the committee. Of the nine voting members of 14 30 the committee, four shall represent covered employers, and 14 31 four shall represent the members of the system. Of the four 14 32 voting members representing employers, one shall be the 14 33 director of the department of personnel, one shall be a member 14 34 of a constituent group that represents cities, one shall be a 14 35 member of a constituent group that represents counties, and 15 1 one shall be a member of a constituent group that represents 15 2 local school districts. Of the four voting members who 15 3 represent members of the system, one shall be a member of a 15 4 constituent group that represents teachers. The ninth voting 15 5 member of the committee shall be a citizen who is not a member 15 6 of the system and who is elected by the other voting members 15 7 of the committee. 15 8 4. DUTIES. 15 9 a. At least every two years, the benefits advisory 15 10 committee shall review the benefits and services provided to 15 11 members under this chapter, and the voting members of the 15 12 committee shall make recommendations to the division and the 15 13 general assembly concerning the benefits, benefits policy, and 15 14 benefit goals, provided under this chapter. 15 15 b. The benefits advisory committee shall be involved in 15 16 the performance evaluation of the chief benefits officer. 15 17 5. TERMS OF VOTING MEMBERS. Except for the director of 15 18 the department of personnel and as otherwise provided in the 15 19 rules for the initial selection of voting members of the 15 20 committee, each member selected to be a voting member shall 15 21 serve as a voting member for three years. Terms for voting 15 22 members begin on May 1 in the year of selection and expire on 15 23 April 30 in the year of expiration. Vacancies shall be filled 15 24 in the same manner as the original selections. A vacancy 15 25 shall be filled for the unexpired term. 15 26 6. EXPENSES. The members who are not active members of 15 27 the system shall be paid their actual expenses incurred in the 15 28 performance of their duties and shall receive a per diem as 15 29 specified in section 7E.6 for each day of service not 15 30 exceeding forty days per year. The members who are active 15 31 members of the system and the director of the department of 15 32 personnel shall be paid their actual expenses incurred in the 15 33 performance of their duties as members of the committee and 15 34 the performance of their duties as members of the committee 15 35 shall not affect their salaries, vacations, or leaves of 16 1 absence for sickness or injury. 16 2 Sec. 14. Section 97B.20A, Code 2001, is amended to read as 16 3 follows: 16 4 97B.20A APPEAL PROCEDURE. 16 5 Members and third-party payees may appeal any decision made 16 6 by thedepartmentdivision that affects their rights under 16 7 this chapter. The appeal shall be filed with thedepartment16 8 division within thirty days after the notification of the 16 9 decision was mailed to the party's last known mailing address, 16 10 or the decision of thedepartmentdivision is final. If the 16 11 party appeals the decision of thedepartmentdivision, the 16 12departmentdivision shall conduct an internal review of the 16 13 decision and the chiefbenefitsexecutive officer shall notify 16 14 the individual who has filed the appeal in writing of the 16 15department'sdivision's decision. The individual who has 16 16 filed the appeal may file an appeal of thedepartment's16 17 division's final decision with thedepartmentdivision under 16 18 chapter 17A by notifying thedepartmentdivision of the appeal 16 19 in writing within thirty days after the notification of its 16 20 final decision was mailed to the party's last known mailing 16 21 address. Once notified, thedepartmentdivision shall forward 16 22 the appeal to the department of inspections and appeals. 16 23 Sec. 15. Section 97B.25, Code 2001, is amended to read as 16 24 follows: 16 25 97B.25 APPLICATIONS FOR BENEFITS. 16 26 A representative designated by the chiefbenefitsexecutive 16 27 officer and referred to in this chapter as a retirement 16 28 benefits officer shall promptly examine applications for 16 29 retirement benefits and on the basis of facts found shall 16 30 determine whether or not the claim is valid. If the claim is 16 31 valid, the retirement benefits officer shall send a 16 32 notification to the member stating the option the member has 16 33 selected pursuant to section 97B.51, the month with respect to 16 34 which benefits shall commence, and the monthly benefit amount 16 35 payable. If the claim is invalid, the retirement benefits 17 1 officer shall promptly notify the applicant and any other 17 2 interested party of the decision and the reasons. A 17 3 retirement application shall not be amended or revoked by the 17 4 member once the first retirement allowance is paid. A 17 5 member's death during the first month of entitlement shall not 17 6 invalidate an approved application. 17 7 Sec. 16. Section 257B.20, subsection 4, Code 2001, is 17 8 amended to read as follows: 17 9 4. In any investments authorized for the Iowa public 17 10 employees' retirement system in section97B.7, subsection 2,17 11paragraph "b"97B.7A, except that investment in common stocks 17 12 shall not be permitted. 17 13 Sec. 17. Section 411.7, subsection 2, Code 2001, is 17 14 amended to read as follows: 17 15 2. The secretary of the board of trustees shall invest, in 17 16 accordance with the investment policy established by the board 17 17 of trustees, the portion of the fund established in section 17 18 411.8 which in the judgment of the board is not needed for 17 19 current payment of benefits under this chapter in investments 17 20 authorized in section97B.7, subsection 2, paragraph "b"17 21 97B.7A, for moneys in the Iowa public employees' retirement 17 22 fund. 17 23 Sec. 18. Section 602.9111, subsection 1, Code 2001, is 17 24 amended to read as follows: 17 25 1. So much of the judicial retirement fund as may not be 17 26 necessary to be kept on hand for the making of disbursements 17 27 under this article shall be invested by the treasurer of state 17 28 in any investments authorized for the Iowa public employees' 17 29 retirement system in section97B.7, subsection 2, paragraph17 30"b"97B.7A, and the earnings therefrom shall be credited to 17 31 the fund. The treasurer of state may execute contracts and 17 32 agreements with investment advisors, consultants, and 17 33 investment management and benefit consultant firms in the 17 34 administration of the judicial retirement fund. 17 35 Sec. 19. INVESTMENT BOARD TRANSITION. 18 1 1. Notwithstanding provisions of section 97B.8A, as 18 2 enacted in this Act, to the contrary, the new investment board 18 3 of the Iowa public employees' retirement system shall, on July 18 4 1, 2002, consist of the following members, who shall serve the 18 5 following terms: 18 6 a. The members of the investment board established under 18 7 section 97B.8, Code 2001, who are an active member who is an 18 8 employee of a school district, area education agency, or 18 9 merged area; an active member who is not an employee of a 18 10 school district, area education agency, or merged area; and a 18 11 retired member, shall cease membership on the investment board 18 12 and commence membership on the new investment board 18 13 established under section 97B.8A on July 1, 2002. The terms 18 14 of these members on the investment board established under 18 15 section 97B.8A shall expire on the same date as their terms 18 16 would have expired on the investment board in accordance with 18 17 section 97B.8, Code 2001. 18 18 b. The members of the investment board established under 18 19 section 97B.8, Code 2001, who are an executive of a domestic 18 20 life insurance company, an executive of a state or national 18 21 bank, and an executive of an industrial corporation located 18 22 within the state of Iowa, shall cease membership on the 18 23 investment board and commence membership on the new investment 18 24 board established under section 97B.8A on July 1, 2002. The 18 25 terms of these members on the new investment board established 18 26 under section 97B.8A shall expire on the same date as their 18 27 terms would have expired on the investment board in accordance 18 28 with section 97B.8, Code 2001. Upon expiration of each of 18 29 these member's term of office, the governor shall appoint a 18 30 member to the board consistent with the requirements of 18 31 section 97B.8A, subsection 4, paragraph "a", subparagraph (1). 18 32 c. The members of the investment board established under 18 33 section 97B.8, Code 2001, who are legislative members shall 18 34 cease membership on the investment board and commence 18 35 membership on the new investment board established under 19 1 section 97B.8A on July 1, 2002. The terms of these members 19 2 shall expire at the pleasure of the appointing authorities as 19 3 provided in section 97B.8A, as enacted in this Act. 19 4 d. The director of the department of personnel shall cease 19 5 membership on the investment board established under section 19 6 97B.8, Code 2001, on July 1, 2002. The treasurer of state 19 7 shall commence membership on the new investment board 19 8 established under section 97B.8A, and shall serve on the board 19 9 as provided in section 97B.8A, as enacted in this Act. 19 10 2. Initial appointments by the governor under this section 19 11 are subject to confirmation by the senate. If a vacancy 19 12 occurs as to a member of the investment board established 19 13 under section 97B.8A who is appointed by the governor prior to 19 14 the expiration of a term as provided in this section, the 19 15 governor shall appoint a member to serve the remainder of the 19 16 term so that the membership requirements of section 97B.8A, as 19 17 enacted in this Act, are fulfilled, and the appointment shall 19 18 be subject to confirmation by the senate. Upon the expiration 19 19 of a term established in this section, a member shall be 19 20 appointed in the manner and for a term of service as specified 19 21 in section 97B.8A, as enacted in this Act. Except as 19 22 otherwise provided in this section, the investment board 19 23 established under this section shall be subject to the 19 24 requirements of section 97B.8A, as enacted in this Act. 19 25 Sec. 20. BENEFITS ADVISORY COMMITTEE TRANSITION. 19 26 1. Effective July 1, 2001, and notwithstanding provisions 19 27 of section 97B.8B, as enacted in this Act, to the contrary, a 19 28 transition benefits advisory committee shall be created and 19 29 shall consist of the following voting members: 19 30 a. A member representing the Iowa state education 19 31 association. 19 32 b. A member representing the Iowa association of community 19 33 college trustees. 19 34 c. A member representing the school administrators of 19 35 Iowa. 20 1 d. A member representing the Iowa association of school 20 2 boards. 20 3 e. A member representing the retired school personnel 20 4 association. 20 5 f. A member representing the state police officers 20 6 council. 20 7 g. The director of the department of personnel. 20 8 h. A member representing the IPERS' improvement 20 9 association. 20 10 i. A member representing the American federation of state, 20 11 county, and municipal employees. 20 12 j. A member representing the Iowa state sheriffs' and 20 13 deputies' association. 20 14 k. A member representing the Iowa state association of 20 15 counties. 20 16 l. A member representing the Iowa league of cities. 20 17 m. A member representing the Iowa association of chiefs of 20 18 police and peace officers. 20 19 n. A member of the public with substantial pension 20 20 benefits experience as selected by the chief benefits officer 20 21 of the Iowa public employees' retirement system. 20 22 o. A member representing the department of management. 20 23 2. By July 1, 2002, the transition benefits advisory 20 24 committee shall issue a report to the Iowa public employees' 20 25 retirement system division concerning the rules to be adopted 20 26 by the division governing the benefits advisory committee as 20 27 provided in section 97B.8B, as enacted in this Act. The rules 20 28 should include provisions governing the selection of members 20 29 of the committee, the selection of voting members of the 20 30 committee, and any other provisions deemed necessary for 20 31 establishing the benefits advisory committee consistent with 20 32 the requirements of section 97B.8B. 20 33 3. The transition benefits advisory committee shall be 20 34 dissolved by July 31, 2002. 20 35 Sec. 21. AMENDMENTS CHANGING TERMINOLOGY – DIRECTIVES TO 21 1 CODE EDITOR. Except as otherwise provided in this Act, the 21 2 Iowa Code editor is directed to strike the words "department", 21 3 "department of personnel", and "department's" and insert the 21 4 words "division" and "division's" wherever the word 21 5 "department", "department of personnel", or "department's" 21 6 appears in chapter 97B of the Iowa Code and the reference to 21 7 "department", "department of personnel", or "department's" 21 8 means the department of personnel unless a contrary intent is 21 9 clearly evident. 21 10 Sec. 22. ADMINISTRATIVE RULES. To the extent not 21 11 inconsistent with this Act, the administrative rules 21 12 promulgated and adopted by the department of personnel 21 13 concerning the Iowa public employees' retirement system prior 21 14 to July 1, 2002, shall be the rules of the Iowa public 21 15 employees' retirement system division and shall remain in 21 16 effect on and after July 1, 2002, subject to the authority of 21 17 the division to modify or change the rules pursuant to Iowa 21 18 Code chapter 17A. 21 19 Sec. 23. Sections 97B.5, 97B.6, 97B.8, 97B.57, 97B.59, 21 20 97B.60, 97B.61, Code 2001, are repealed. 21 21 Sec. 24. EFFECTIVE DATE. This Act takes effect July 1, 21 22 2002. However, section 21 of this Act, establishing a 21 23 benefits advisory committee transition, takes effect July 1, 21 24 2001. 21 25 EXPLANATION 21 26 This bill modifies the governance and structure of the Iowa 21 27 public employees' retirement system (IPERS). Under current 21 28 law, IPERS is administered by the department of personnel 21 29 through the chief benefits officer and the chief investment 21 30 officer, both of whom are selected by the department. The 21 31 treasurer of state is the trustee of the IPERS retirement 21 32 fund, and the IPERS investment board is statutorily required 21 33 to advise the department in the formulation of the investment 21 34 policy for the fund. 21 35 Under the bill, IPERS remains within the department of 22 1 personnel. However, the management of IPERS is made the 22 2 direct responsibility of the newly created IPERS division 22 3 within the department, and all powers and duties currently 22 4 given to the department of personnel to manage and operate 22 5 IPERS are given to the division. A chief executive officer, 22 6 who shall manage the division, shall be appointed by the 22 7 governor and be subject to confirmation by the senate. The 22 8 bill requires that the chief executive officer have 22 9 demonstrated knowledge of and executive-level experience in 22 10 all aspects of pension fund administration. The bill also 22 11 requires the chief executive officer to employ a chief 22 12 investment officer who shall be selected following 22 13 consultation with the investment board and a chief benefits 22 14 officer who shall be selected following consultation with the 22 15 benefits advisory committee. 22 16 The current IPERS investment board is modified under the 22 17 bill in both structure and duties. 22 18 Under the bill, the investment board is made the trustee of 22 19 the IPERS retirement fund. The board is given the explicit 22 20 authority, in consultation with the chief investment officer 22 21 and other personnel of the division, to develop the investment 22 22 policy and goal statement that will direct the investment 22 23 activities concerning the fund. The actual investment of the 22 24 fund remains the responsibility of the division subject to the 22 25 investment policy established by the board. In addition, the 22 26 investment board is given the authority to hire and fire the 22 27 actuary to be used as the technical advisor of the system. 22 28 The board is also given the responsibility of adopting the 22 29 actuarial assumptions to be used by the actuary in determining 22 30 the condition of the retirement fund. The board is required 22 31 to consult with the chief executive officer, the actuary, and 22 32 other relevant division personnel in the development of the 22 33 actuarial assumptions. 22 34 The membership of the board is also modified under the 22 35 bill. Under the bill, the director of the department of 23 1 personnel is replaced with the treasurer of state, and the 23 2 treasurer is made a voting member of the board. In addition, 23 3 the three current members who must be an executive of a 23 4 domestic life insurance company, an executive of a state or 23 5 national bank operating within the state of Iowa, and an 23 6 executive of an industrial corporation located within the 23 7 state of Iowa, are replaced with three members who must have 23 8 substantial institutional investment experience or financial 23 9 experience. In addition, the three current members of the 23 10 board who are members of the system remain. The two 23 11 legislative members of the board also remain but are made 23 12 nonvoting members of the new board. The bill also establishes 23 13 a mechanism for transitioning from the current board 23 14 membership to the new board membership. 23 15 The bill also establishes a new benefits advisory 23 16 committee. The duties of the committee are to review and make 23 17 recommendations to the division and the general assembly 23 18 concerning the provision of benefits to members of the system. 23 19 The bill provides that the members of this board shall be 23 20 comprised of representatives of constituent groups concerned 23 21 with the system, including representatives of employers, 23 22 active members, and retired members. The election of these 23 23 members shall be done pursuant to rules adopted by the 23 24 division. The director of the department of personnel and a 23 25 person to be selected by the voting members of the committee 23 26 are also specifically included as voting members of the 23 27 committee. The bill provides that of the members of the 23 28 committee, nine shall be voting members who shall serve as 23 29 voting members for three-year terms. Of the nine voting 23 30 members, four shall represent employers, and four shall 23 31 represent employees. The ninth member shall be a member of 23 32 the public and shall be chosen by the other eight voting 23 33 members of the committee. Of the employer representatives, 23 34 one shall be the director of the department of personnel, one 23 35 shall represent a constituent group that represents the 24 1 cities, one shall represent a constituent group that 24 2 represents the counties, and one shall represent local school 24 3 districts. Of the employee representatives, one shall be from 24 4 a group that represents teachers. Expenses for members of the 24 5 committee shall be paid in the same manner and amount as they 24 6 are paid for the current members of the investment board. The 24 7 bill also provides for the establishment of a transition 24 8 benefits advisory committee on July 1, 2001. The bill 24 9 establishes the exact membership of this transition committee 24 10 and provides that it shall be dissolved by July 31, 2002. The 24 11 transition committee is given the task of making 24 12 recommendations in a report to the IPERS division no later 24 13 than July 1, 2002, concerning the rules to adopt in governing 24 14 the new benefits advisory committee. The proposed rules in 24 15 the report shall include, at a minimum, provisions governing 24 16 the selection of members to the committee and the selection of 24 17 voting members of the committee. 24 18 The bill provides that the administrative rules adopted by 24 19 the department of personnel concerning IPERS shall, consistent 24 20 with this bill, remain in effect after the effective date of 24 21 this bill. 24 22 Except for the section of the bill concerning the benefits 24 23 advisory committee transition which takes effect July 1, 2001, 24 24 the bill takes effect July 1, 2002. 24 25 LSB 1627XL 79 24 26 ec/cf/24.1
Text: SSB01246 Text: SSB01248 Text: SSB01200 - SSB01299 Text: SSB Index Bills and Amendments: General Index Bill History: General Index
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