Text: HSB00547 Text: HSB00549 Text: HSB00500 - HSB00599 Text: HSB Index Bills and Amendments: General Index Bill History: General Index
PAG LIN 1 1 Section 1. Section 97B.1A, Code Supplement 2003, is 1 2 amended by adding the following new subsections: 1 3 NEW SUBSECTION. 10A. "Final average salary" means as 1 4 follows: 1 5 a. For a member whose first date of service is before July 1 6 1, 2004, the member's three-year average covered wage. 1 7 b. For a member whose first date of service is on or after 1 8 July 1, 2004, the member's five-year average covered wage. 1 9 NEW SUBSECTION. 10B. "First date of service" means the 1 10 later of the following, if applicable: 1 11 a. The date a person first enters service if no refund of 1 12 contributions for service on that date is made. 1 13 b. The date an inactive nonvested member first reenters 1 14 service if no refund of contributions for service on that date 1 15 is made. 1 16 NEW SUBSECTION. 11A. a. "Five-year average covered wage" 1 17 means, for a member who retires prior to July 1, 2008, a 1 18 member's covered wages averaged for the highest five years of 1 19 the member's service, except as otherwise provided in this 1 20 subsection. The highest five years of a member's covered 1 21 wages shall be determined using calendar years. However, if a 1 22 member's final quarter of a year of employment does not occur 1 23 at the end of a calendar year, the system may determine the 1 24 wages for the fifth year by computing the average quarter of 1 25 all quarters from the member's highest calendar year of 1 26 covered wages not being used in the selection of the four 1 27 highest years and using the computed average quarter for each 1 28 quarter in the fifth year in which no wages have been reported 1 29 in combination with the final quarter or quarters of the 1 30 member's service to create a full year. However, the system 1 31 shall not use the member's final quarter of wages if using 1 32 that quarter would reduce the member's five-year average 1 33 covered wage. Notwithstanding any other provision of this 1 34 paragraph to the contrary, a member's wages for the fifth year 1 35 as computed by this paragraph shall not exceed, by more than 2 1 three percent, the member's highest actual calendar year of 2 2 covered wages. 2 3 b. "Five-year average covered wage" means, for a member 2 4 who retires on or after July 1, 2008, the greater of the 2 5 member's covered wages averaged for a member's highest twenty 2 6 consecutive quarters of service or the member's covered wages 2 7 averaged for a member's highest five calendar years of 2 8 service. The system shall adopt rules to implement this 2 9 paragraph in accordance with the requirements of this chapter 2 10 and the federal Internal Revenue Code. 2 11 Sec. 2. Section 97B.11, Code Supplement 2003, is amended 2 12 to read as follows: 2 13 97B.11 CONTRIBUTIONS BY EMPLOYER AND EMPLOYEE. 2 14 1. Each employer shall deduct from the wages of each 2 15 member of the retirement system a contribution in the amount 2 16 ofthree and seven-tenths percentthe applicable employee 2 17 percentage of the covered wages paid by the employer, until 2 18 the member's termination from employment. The contributions 2 19 of the employer shall be in the amount offive and seventy-2 20five hundredths percentthe applicable employer percentage of 2 21 the covered wages of the member. 2 22 2. For purposes of this section, the "applicable employee 2 23 percentage" is as follows: 2 24 a. Prior to July 1, 2005, three and seven-tenths percent. 2 25 b. Beginning on or after July 1, 2005, but before July 1, 2 26 2006, four and one-tenths percent. 2 27 c. Beginning on or after July 1, 2006, but before July 1, 2 28 2007, four and one-half percent. 2 29 d. Beginning on or after July 1, 2007, but before July 1, 2 30 2008, four and nine-tenths percent. 2 31 e. Beginning on or after July 1, 2008, five and three- 2 32 tenths percent. 2 33 3. For purposes of this section, the "applicable employer 2 34 percentage" is as follows: 2 35 a. Prior to July 1, 2005, five and seventy-five hundredths 3 1 percent. 3 2 b. Beginning on or after July 1, 2005, but before July 1, 3 3 2006, six and thirty-five hundredths percent. 3 4 c. Beginning on or after July 1, 2006, but before July 1, 3 5 2007, six and ninety-five hundredths percent. 3 6 d. Beginning on or after July 1, 2007, but before July 1, 3 7 2008, seven and fifty-five hundredths percent. 3 8 e. Beginning on or after July 1, 2008, eight and fifteen 3 9 hundredths percent. 3 10 Sec. 3. Section 97B.49A, subsection 3, Code Supplement 3 11 2003, is amended to read as follows: 3 12 3. CALCULATION OF MONTHLY ALLOWANCE. For each active or 3 13 inactive vested member retiring on or after July 1, 1994, with 3 14 four or more complete years of service, a monthly benefit 3 15 shall be computed which is equal to one-twelfth of an amount 3 16 equal to the applicable percentage of thethree-year average3 17covered wagemember's final average salary multiplied by a 3 18 fraction of years of service. However, if benefits under this 3 19 section commence on an early retirement date, the amount of 3 20 the benefit shall be reduced in accordance with section 3 21 97B.50. 3 22 Sec. 4. Section 97B.49B, subsections 2 and 4, Code 3 23 Supplement 2003, are amended to read as follows: 3 24 2. CALCULATION OF MONTHLY ALLOWANCE. Notwithstanding 3 25 other provisions of this chapter, a member who is or has been 3 26 employed in a protection occupation who retires on or after 3 27 July 1, 1994, and at the time of retirement is at least fifty- 3 28 five years of age may elect to receive, in lieu of the receipt 3 29 of any benefits as calculated pursuant to section 97B.49A or 3 30 97B.49D, a monthly retirement allowance equal to one-twelfth 3 31 of an amount equal to the applicable percentage of thethree-3 32year average covered wagemember's final average salary as a 3 33 member who has been employed in a protection occupation 3 34 multiplied by a fraction of years of service, with benefits 3 35 payable during the member's lifetime. 4 1 4. Notwithstanding any provision of this chapter to the 4 2 contrary, thethree-year average covered wagefinal average 4 3 salary for a member retiring under this section whose years of 4 4 eligible service equals or exceeds twenty-two years of 4 5 eligible service for that member shall be determined by 4 6 calculating the member's eligible combined wage for each year 4 7 of eligible service. For purposes of this subsection, 4 8 "eligible combined wage" means the wages earned by the member 4 9 for each quarter year period from eligible service and from 4 10 covered employment that is not eligible service if at least 4 11 seventy-five percent of the wages earned was from eligible 4 12 service. 4 13 Sec. 5. Section 97B.49C, subsections 2 and 4, Code 4 14 Supplement 2003, are amended to read as follows: 4 15 2. CALCULATION OF MONTHLY ALLOWANCE. Notwithstanding 4 16 other provisions of this chapter, a member who retires from 4 17 employment as a sheriff, deputy sheriff, or airport fire 4 18 fighter on or after July 1, 1994, and at the time of 4 19 retirement is at least fifty-five years of age may elect to 4 20 receive, in lieu of the receipt of any benefits as calculated 4 21 pursuant to section 97B.49A or 97B.49D, a monthly retirement 4 22 allowance equal to one-twelfth of an amount equal to the 4 23 applicable percentage of thethree-year average covered wage4 24 member's final average salary as a member who has been 4 25 employed in eligible service multiplied by a fraction of years 4 26 of service, with benefits payable during the member's 4 27 lifetime. 4 28 4. Notwithstanding any provision of this chapter to the 4 29 contrary, thethree-year average covered wagefinal average 4 30 salary for a member retiring under this section whose years of 4 31 eligible service equals or exceeds twenty-two years of 4 32 eligible service for that member shall be determined by 4 33 calculating the member's eligible combined wage for each 4 34 quarter year of eligible service. For purposes of this 4 35 subsection, "eligible combined wage" means the wages earned by 5 1 the member for each quarter year period from eligible service 5 2 and from covered employment that is not eligible service if at 5 3 least seventy-five percent of the wages earned was from 5 4 eligible service. 5 5 Sec. 6. Section 97B.49D, subsection 1, paragraphs a, b, 5 6 and c, Code Supplement 2003, are amended to read as follows: 5 7 a. One-twelfth of an amount equal to the applicable 5 8 percentage of the member'sthree-year average covered wage5 9 final average salary multiplied by a fraction of years of 5 10 service. The fraction of years of service for purposes of 5 11 this paragraph shall be the actual years of service, not to 5 12 exceed thirty, for which regular service contributions were 5 13 made, divided by thirty. However, any otherwise applicable 5 14 age reduction for early retirement shall apply to the 5 15 calculation under this paragraph. 5 16 b. One-twelfth of an amount equal to the applicable 5 17 percentage of the member'sthree-year average covered wage5 18 final average salary multiplied by a fraction of years of 5 19 service. The fraction of years of service for purposes of 5 20 this paragraph shall be the actual years of service, not to 5 21 exceed the applicable years of service for the member as 5 22 defined in section 97B.49B, earned in a position described in 5 23 section 97B.49B, for which special service contributions were 5 24 made, divided by the applicable years of service for the 5 25 member as defined in section 97B.49B. In calculating the 5 26 fractions of years of service under the paragraph, a member 5 27 shall not receive special service credit for years of service 5 28 for which the member and the member's employer did not make 5 29 the required special service contributions to the system. 5 30 c. One-twelfth of an amount equal to the applicable 5 31 percentage of the member'sthree-year average covered wage5 32 final average salary multiplied by a fraction of years of 5 33 service. The fraction of years of service for purposes of 5 34 this paragraph shall be the actual years of service, not to 5 35 exceed twenty-two, earned in a position described in section 6 1 97B.49C, for which special service contributions were made, 6 2 divided by twenty-two. In calculating the fractions of years 6 3 of service under this paragraph, a member shall not receive 6 4 special service credit for years of service for which the 6 5 member and the member's employer did not make the required 6 6 special service contributions to the system. 6 7 Sec. 7. Section 97B.50, subsection 1, paragraph a, Code 6 8 Supplement 2003, is amended to read as follows: 6 9 a. For a memberwho is less than sixty-two years of age6 10 whose first date of service is before July 1, 2004, by twenty- 6 11 five hundredths of one percent per month for each month that 6 12 the early retirement date precedes the normal retirement date. 6 13 Sec. 8. Section 97B.50, subsection 1, paragraph b, Code 6 14 Supplement 2003, is amended by striking the paragraph and 6 15 inserting in lieu thereof the following: 6 16 b. For a member whose first date of service is on or after 6 17 July 1, 2004, by the actuarial cost to the system for each 6 18 month that the early retirement date precedes the normal 6 19 retirement date. 6 20 Sec. 9. Section 97B.50A, subsection 1, paragraph c, Code 6 21 Supplement 2003, is amended to read as follows: 6 22 c. "Reemployment comparison amount" means an amount equal 6 23 to the current covered wages of an active special service 6 24 member at the same position on the salary scale within the 6 25 rank or position the member held at the time the member 6 26 received a disability retirement allowance pursuant to this 6 27 section. If the rank or position held by the member at the 6 28 time of retirement pursuant to this section is abolished, the 6 29 amount shall be computed by the system as though the rank or 6 30 position had not been abolished and salary increases had been 6 31 granted on the same basis as granted to other ranks or 6 32 positions by the former employer of the member. The 6 33 reemployment comparison amount shall not be less than the 6 34three-year average covered wagefinal average salary of the 6 35 member, based on all regular and special service covered under 7 1 this chapter. 7 2 Sec. 10. Section 97B.50A, subsection 2, paragraph d, Code 7 3 Supplement 2003, is amended to read as follows: 7 4 d. Upon retirement for an in-service disability as 7 5 provided by this subsection, a member shall have the option to 7 6 receive a monthly in-service disability retirement allowance 7 7 calculated under this subsection or a monthly retirement 7 8 allowance as provided in section 97B.49A, 97B.49B, 97B.49C, 7 9 97B.49D, or 97B.49G, as applicable, that the member would 7 10 receive if the member had attained fifty-five years of age. 7 11 The monthly in-service disability allowance calculated under 7 12 this subsection shall consist of an allowance equal to one- 7 13 twelfth of sixty percent of the member'sthree-year average7 14covered wagefinal average salary or its actuarial equivalent 7 15 as provided under section 97B.51. 7 16 Sec. 11. Section 97B.50A, subsection 3, paragraph c, Code 7 17 Supplement 2003, is amended to read as follows: 7 18 c. Upon retirement for an ordinary disability as provided 7 19 by this subsection, a member shall receive the greater of a 7 20 monthly ordinary disability retirement allowance calculated 7 21 under this subsection or a monthly retirement allowance as 7 22 provided in section 97B.49A, 97B.49B, 97B.49C, 97B.49D, or 7 23 97B.49G, as applicable. The monthly ordinary disability 7 24 allowance calculated under this subsection shall consist of an 7 25 allowance equal to one-twelfth of fifty percent of the 7 26 member'sthree-year average covered wagefinal average salary 7 27 or its actuarial equivalent as provided under section 97B.51. 7 28 EXPLANATION 7 29 This bill makes changes to the Iowa public employees' 7 30 retirement system (IPERS) relating to contributions made to 7 31 the system by employers and employees and the calculation of a 7 32 pension for normal and early retirement. 7 33 Code section 97B.1A is amended to add a definition for a 7 34 member's first date of service which is the later of the date 7 35 a person is first paid covered wages as an employee covered by 8 1 IPERS if no refund of contributions is made or the date an 8 2 inactive nonvested member first reenters employment under 8 3 IPERS if no refund of contributions for service on that date 8 4 is made. 8 5 The bill amends Code chapter 97B to provide that a member 8 6 whose first date of service under IPERS is on or after July 1, 8 7 2004, shall have their retirement allowance calculated based 8 8 upon the member's five-year average covered wage instead of 8 9 the member's three-year average covered wage. 8 10 Code section 97B.11 is amended to increase, over a four- 8 11 year period beginning July 1, 2005, contributions to the 8 12 system from the employer and employee. Currently, the 8 13 employer rate is 5.75 percent and the employee rate is 3.7 8 14 percent of a member's covered wages. The bill increases the 8 15 employer rate by .6 percent each fiscal year beginning July 1, 8 16 2005, until the rate reaches 8.15 percent beginning July 1, 8 17 2008. The bill increases the employee percentage by .4 8 18 percent each fiscal year beginning July 1, 2005, until the 8 19 rate reaches 5.3 percent beginning July 1, 2008. 8 20 Code section 97B.50, concerning the calculation of a 8 21 member's retirement allowance for an early retirement, is also 8 22 amended. Currently, a member's retirement allowance is 8 23 reduced by .25 percent for each month the member retires prior 8 24 to the member's normal retirement date. The bill provides 8 25 that a member whose first date of service is on or after July 8 26 1, 2004, shall have their retirement allowance reduced by the 8 27 actuarial cost to the system for each month that the early 8 28 retirement date precedes the member's normal retirement date. 8 29 LSB 5452XL 80 8 30 ec/sh/8
Text: HSB00547 Text: HSB00549 Text: HSB00500 - HSB00599 Text: HSB Index Bills and Amendments: General Index Bill History: General Index
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