S.F. _____ H.F. _____ Section 1. Section 97B.1A, subsection 5, Code 2014, is 1 amended to read as follows: 2 5. “Beneficiary” means the person or persons who are 3 entitled to receive any benefits payable under this chapter 4 at the death of a member, if the person or persons have been 5 designated on a form provided by the system and filed with the 6 system or designated pursuant to a qualified domestic relations 7 order on file with the system . If no such designation is in 8 effect at the time of death of the member or if no person so 9 designated is living at that time, then the beneficiary is the 10 estate of the member. 11 Sec. 2. Section 97B.1A, subsection 8, paragraph b, 12 subparagraph (7), Code 2014, is amended to read as follows: 13 (7) Employees of an area agency on aging , if as of July 14 1, 1994, the agency provides for participation by all of its 15 employees who were participating in an alternative qualified 16 plan pursuant to the requirements of the federal Internal 17 Revenue Code on June 30, 2012, and who by September 1, 2013, 18 filed with the system a valid decision to elect out of coverage 19 under this chapter . 20 Sec. 3. Section 97B.1A, subsection 14A, Code 2014, is 21 amended to read as follows: 22 14A. “Member account” means the account established for each 23 member and includes the member’s accumulated contributions and 24 the member’s share of the accumulated employer contributions as 25 provided in section 97B.53 . “Member account” does not mean the 26 supplemental account for active members. 27 Sec. 4. Section 97B.1A, subsection 22A, Code 2014, is 28 amended by striking the subsection. 29 Sec. 5. Section 97B.7A, subsection 5, Code 2014, is amended 30 to read as follows: 31 5. Travel. In the administration of the investment of 32 moneys in the retirement fund, employees of the system and 33 members of the board may travel outside the state for the 34 purpose of meeting with investment firms and consultants and 35 -1- LSB 5224DP (6) 85 ec/sc 1/ 10

S.F. _____ H.F. _____ attending conferences and meetings to fulfill their fiduciary 1 responsibilities. This travel is not subject to section 2 8A.512, subsection 2 . 3 Sec. 6. Section 97B.40, subsection 2, Code 2014, is amended 4 to read as follows: 5 2. If the system determines that a person may have engaged 6 in a fraudulent practice as described under this section , the 7 system may, in addition to any statutory or equitable remedies 8 provided by law, refuse to approve an application for benefits, 9 suspend or reduce benefits to the person, and refer the matter 10 to the auditor of state and to the appropriate law enforcement 11 authorities for possible investigation and prosecution. 12 Sec. 7. Section 97B.44, Code 2014, is amended to read as 13 follows: 14 97B.44 Beneficiary. 15 1. Each member shall designate , on a form to be furnished 16 by the system or through a qualified domestic relations order 17 on file with the system, designate a beneficiary for death 18 benefits payable under this chapter on the death of the member. 19 The designation may be changed from time to time by the member 20 by filing a new designation with the system. A designation 21 or change in designation made by a member on or after July 22 1, 2000, shall contain the written consent of the member’s 23 spouse, if applicable. The designation of a beneficiary is not 24 applicable if the member receives a refund of all contributions 25 of the member. If a member who has received a refund of 26 contributions returns to employment, the member shall file a 27 new designation with the system. 28 2. If a member has not designated a beneficiary on a form 29 furnished by the system as provided by this section , or if 30 there are no surviving designated beneficiaries of a member, 31 death benefits payable under this chapter shall be paid to the 32 member’s estate. 33 3. However, the The system may accept a married member’s 34 designation or change in designation under this section without 35 -2- LSB 5224DP (6) 85 ec/sc 2/ 10

S.F. _____ H.F. _____ the written consent of the member’s spouse if the member 1 submits a notarized statement indicating that the member has 2 been unable to locate the member’s spouse to obtain the written 3 consent of the spouse after reasonable diligent efforts. The 4 member’s designation or change in designation shall become 5 effective upon filing the necessary forms, including the 6 notarized statement, or orders, with the system. The system 7 shall not be liable to the member, the member’s spouse, or 8 to any other person affected by the member’s designation or 9 change of designation, based upon a designation or change of 10 designation accomplished without the written consent of the 11 member’s spouse. 12 Sec. 8. Section 97B.46, subsection 2, Code 2014, is amended 13 to read as follows: 14 2. A member remaining in service after attaining the age 15 of seventy years is entitled to receive a retirement allowance 16 under sections 97B.49A through 97B.49H 97B.49G , as applicable, 17 without terminating employment. 18 Sec. 9. Section 97B.48, subsection 4, Code 2014, is amended 19 to read as follows: 20 4. Payment of a member’s retirement allowance pursuant to 21 sections 97B.49A through 97B.49H 97B.49G shall commence no 22 later than the required beginning date specified under section 23 401(a)(9) of the federal Internal Revenue Code regardless of 24 whether the member has submitted the appropriate notice to 25 receive an allowance. If the lump sum actuarial equivalent 26 under subsection 1 could have been selected by the member, 27 payments shall be made in a lump sum rather than as a monthly 28 allowance. 29 Sec. 10. Section 97B.49F, subsection 2, Code 2014, is 30 amended by striking the subsection. 31 Sec. 11. Section 97B.50A, subsection 1, paragraph b, Code 32 2014, is amended to read as follows: 33 b. “Net disability retirement allowance” means the amount 34 determined by subtracting the amount paid during the previous 35 -3- LSB 5224DP (6) 85 ec/sc 3/ 10

S.F. _____ H.F. _____ calendar year by the member for health insurance or similar 1 health care coverage for the member and the member’s dependents 2 from the amount of the member’s disability retirement 3 allowance, including any dividends and distributions from 4 supplemental accounts, paid for that year pursuant to this 5 section . 6 Sec. 12. Section 97B.50A, subsection 9, Code 2014, is 7 amended to read as follows: 8 9. Medical board. The system shall designate a medical 9 board to be composed of three a physician or physicians from 10 the university of Iowa hospitals and clinics who shall arrange 11 for and pass upon the medical examinations required under 12 this section and shall report in writing to the system the 13 conclusions and recommendations upon all matters duly referred 14 to the medical board. Each report of a medical examination 15 under this section shall include the medical board’s findings 16 as to the extent of the member’s physical or mental impairment. 17 Except as required by this section , each report shall be 18 confidential and shall be maintained in accordance with the 19 federal Americans With Disabilities Act, and any other state 20 or federal law containing requirements for confidentiality of 21 medical records. 22 Sec. 13. Section 97B.53, Code 2014, is amended by adding the 23 following new subsection: 24 NEW SUBSECTION . 11. A request for a refund under this 25 section made by a member who is married requires the written 26 acknowledgment of the member’s spouse. However, the system 27 may accept a married member’s request for a refund under this 28 section without the written acknowledgment of the member’s 29 spouse if the member submits a statement affirming that after 30 reasonable diligent efforts the member has been unable to 31 locate the member’s spouse to obtain the written acknowledgment 32 of the spouse. A married member’s request for a refund under 33 this section shall become effective upon filing the necessary 34 forms, or including the affirmation if applicable, with the 35 -4- LSB 5224DP (6) 85 ec/sc 4/ 10

S.F. _____ H.F. _____ system. The system shall not be liable to the member, the 1 member’s spouse, nor to any other person affected by the 2 member’s request for a refund based upon a request for a refund 3 accomplished without the written acknowledgment of the member’s 4 spouse. 5 Sec. 14. Section 97B.53A, Code 2014, is amended to read as 6 follows: 7 97B.53A Duty of system. 8 Upon a member’s termination of covered employment prior to 9 the member’s retirement, the system shall send the member by 10 first class mail, to the member’s last known mailing address, 11 a notice setting forth the balance and status of the member’s 12 account and supplemental account and an explanation of the 13 courses of action available to the member under this chapter . 14 Sec. 15. Section 97B.53B, subsection 1, paragraph d, 15 subparagraph (1), subparagraph division (a), Code 2014, is 16 amended to read as follows: 17 (a) All or any portion of a member’s account and 18 supplemental account . 19 Sec. 16. Section 97B.70, subsection 3, Code 2014, is amended 20 to read as follows: 21 3. Interest shall be credited to the accumulated 22 contributions and accumulated employer contributions accounts , 23 and supplemental accounts of active members, inactive vested 24 members, and, effective January 1, 1999, to inactive nonvested 25 members, until the quarter prior to the quarter in which the 26 member’s first retirement allowance is paid or in which the 27 member is issued a refund under section 97B.53 , or in which a 28 death benefit is issued. 29 Sec. 17. Section 97B.80, subsection 1, Code 2014, is amended 30 to read as follows: 31 1. a. For purposes of this subsection, “eligible member” 32 means as follows: 33 (1) For the period beginning July 1, 1992, and ending June 34 30, 2014, a vested or retired member who has one or more full 35 -5- LSB 5224DP (6) 85 ec/sc 5/ 10

S.F. _____ H.F. _____ calendar years of covered wages. 1 (2) Beginning on or after July 1, 2014, a member vested by 2 service or a retired member who is vested by service and who 3 is within six months of the retired member’s first month of 4 entitlement. 5 b. Effective July 1, 1992, a vested or retired An eligible 6 member who has one or more full calendar years of covered wages 7 and who at any time served on active duty in the armed forces of 8 the United States, upon submitting verification of the dates 9 of the active duty service, may make contributions to the 10 retirement system for all or a portion of the period of time of 11 the active duty service, in increments of one or more calendar 12 quarters, and receive credit for membership service and prior 13 service for the period of time for which the contributions are 14 made. 15 Sec. 18. Section 97B.80C, subsection 1, Code 2014, is 16 amended by adding the following new paragraph: 17 NEW PARAGRAPH . 0a. “Eligible member” means as follows: 18 (1) Prior to July 1, 2014, a vested or retired member. 19 (2) Beginning on or after July 1, 2014, a member vested by 20 service or a retired member who is vested by service and who 21 is within six months of the retired member’s first month of 22 entitlement. 23 Sec. 19. Section 97B.80C, subsection 2, paragraphs a, b, and 24 c, Code 2014, are amended to read as follows: 25 a. A vested or retired An eligible member may make 26 contributions to the retirement system to purchase up to the 27 maximum amount of permissive service credit for qualified 28 service as determined by the system, pursuant to Internal 29 Revenue Code section 415(n), the requirements of this section , 30 and the system’s administrative rules. 31 b. A vested or retired An eligible member of the retirement 32 system may make contributions to the retirement system to 33 purchase up to a maximum of twenty quarters of permissive 34 service credit for nonqualified service as determined by the 35 -6- LSB 5224DP (6) 85 ec/sc 6/ 10

S.F. _____ H.F. _____ system, pursuant to Internal Revenue Code section 415(n), the 1 requirements of this section , and the system’s administrative 2 rules. A vested or retired An eligible member must have at 3 least twenty quarters of covered wages in order to purchase 4 permissive service credit for nonqualified service. 5 c. A vested or retired An eligible member may convert 6 regular member service credit to special service credit by 7 payment of the amount actuarially determined as necessary to 8 fund the resulting increase in the member’s accrued benefit. 9 The conversion shall be treated as a purchase of qualified 10 service credit subject to the requirements of paragraph “a” 11 if the service credit to be converted was or would have been 12 for qualified service. The conversion shall be treated as 13 a purchase of nonqualified service credit subject to the 14 requirements of paragraph “b” if the service credit to be 15 converted was purchased as nonqualified service credit. 16 Sec. 20. Section 231.33, subsection 21, Code 2014, is 17 amended to read as follows: 18 21. Comply with all applicable requirements of the Iowa 19 public employees’ retirement system established pursuant to 20 chapter 97B . Notwithstanding any provision to the contrary, 21 an employee of an area agency on aging that was enrolled in 22 an alternative qualified plan prior to July 1, 2012, may 23 continue participation in that alternative qualified plan in 24 lieu of mandatory participation in the Iowa public employees’ 25 retirement system. 26 Sec. 21. Section 602.11115, subsection 2, Code 2014, is 27 amended to read as follows: 28 2. To commence coverage under the judicial retirement 29 system pursuant to article 9 , part 1, effective July 1, 1984, 30 but to become an inactive member of the Iowa public employees’ 31 retirement system pursuant to chapter 97B and remain eligible 32 for benefits under sections 97B.49A through 97B.49H 97B.49G for 33 the period of membership service under chapter 97B . 34 Sec. 22. Section 602.11116, subsection 2, Code 2014, is 35 -7- LSB 5224DP (6) 85 ec/sc 7/ 10

S.F. _____ H.F. _____ amended to read as follows: 1 2. To commence membership under the judicial retirement 2 system pursuant to article 9 , part 1, effective July 1, 1998, 3 but to become an inactive member of the Iowa public employees’ 4 retirement system pursuant to chapter 97B and remain eligible 5 for benefits under sections 97B.49A through 97B.49H 97B.49G , as 6 applicable, for the period of membership service under chapter 7 97B . 8 Sec. 23. REPEAL. Sections 97B.49H and 97B.49I, Code 2014, 9 are repealed. 10 Sec. 24. EFFECTIVE UPON ENACTMENT. The following 11 provision or provisions of this Act, being deemed of immediate 12 importance, take effect upon enactment: 13 1. The section of this Act amending section 97B.1A, 14 subsection 8, paragraph b, subparagraph (7). 15 Sec. 25. RETROACTIVE APPLICABILITY. The following 16 provision or provisions of this Act apply retroactively to June 17 30, 2012: 18 1. The section of this Act amending section 97B.1A, 19 subsection 8, paragraph b, subparagraph (7). 20 2. The section of this Act amending section 231.33, 21 subsection 21. 22 EXPLANATION 23 The inclusion of this explanation does not constitute agreement with 24 the explanation’s substance by the members of the general assembly. 25 This bill concerns the Iowa Public Employees’ Retirement 26 System (IPERS). 27 Code sections 97B.1A(5) and 97B.44, concerning beneficiaries 28 under IPERS, are amended to provide that beneficiaries can be 29 designated through a qualified domestic relations order. 30 Code section 97B.1A(8)(b), defining employees who are not 31 covered under IPERS, is amended to provide that employees of an 32 area agency on aging who were participating in an alternative 33 retirement plan on June 30, 2012, and who elected out of IPERS 34 coverage by September 1, 2013, are excluded from coverage under 35 -8- LSB 5224DP (6) 85 ec/sc 8/ 10

S.F. _____ H.F. _____ IPERS. A corresponding amendment is made to Code section 1 231.33, concerning area agencies on aging. These provisions 2 take effect upon enactment and apply retroactively to June 30, 3 2012. 4 Code section 97B.40, concerning fraudulent practices under 5 IPERS, is amended. The bill authorizes IPERS to refuse to 6 approve an application for benefits or to suspend or reduce 7 benefits to a person if the IPERS system determines the person 8 may have engaged in a fraudulent practice. 9 Code section 97B.49F(2), establishing the favorable 10 experience dividend program for IPERS members who retired on or 11 after July 1, 1990, is stricken. 12 Code section 97B.49H, establishing active member 13 supplemental accounts, is repealed. The bill includes 14 corresponding amendments related to the repeal. 15 Code section 97B.49I, providing for a qualified benefits 16 arrangement, is repealed. 17 Code section 97B.50A(9), concerning the medical board 18 used for purposes of disability benefits for special service 19 IPERS members, is amended to allow IPERS to use one or more 20 physicians from the University of Iowa as the medical board. 21 Current law requires that the medical board consist of three 22 physicians from the University of Iowa. 23 Code section 97B.53, concerning refunds, is amended to 24 require a married IPERS member seeking a refund to submit 25 a written acknowledgment of the member’s spouse to IPERS. 26 The bill provides that a married member may still receive 27 a refund if the member is unable to locate the spouse and 28 IPERS shall not be liable based upon a refund made without the 29 acknowledgment of the member’s spouse. 30 Code section 97B.80, concerning the purchase of IPERS 31 service for military service, is amended to provide that only a 32 member vested by service or a retired member who is vested by 33 service and is within six months of the member’s first month 34 of entitlement may make a service purchase under this Code 35 -9- LSB 5224DP (6) 85 ec/sc 9/ 10

S.F. _____ H.F. _____ section. Currently, any vested or retired member, regardless 1 of how the member became vested, who has at least one year of 2 IPERS wages may make a service purchase at any time. 3 Code section 97B.80C, concerning purchases of permissive 4 service credit, is amended to provide that only a member 5 vested by service or a retired member who is vested by 6 service and is within six months of the member’s first month 7 of entitlement may make a service purchase under this Code 8 section. Currently, any vested or retired member, regardless 9 of how the member became vested, may make a service purchase 10 under this Code section at any time. 11 -10- LSB 5224DP (6) 85 ec/sc 10/ 10