HF 749 (LSB 1102YH (2) 91)

HOUSE FILE 749

BY  JONES

A BILL FOR

An Act providing an early retirement option under the municipal fire and police retirement system.
BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA:

    Section 1.  Section 411.6, subsection 1, paragraph a, Code 2025, is amended to read as follows:
   a.  Any member in service may retire upon written application to the system, setting forth at what time, not less than thirty nor more than ninety days subsequent to the execution and filing of the application, the member desires to be retired. However, the member at the time specified for retirement shall have attained the age of fifty-five and shall have served twenty-two years or more, and notwithstanding that, during the period of notification, the member may have separated from the service.  However, a member may retire at fifty years of age and receive a reduced retirement allowance pursuant to subsection 2A.
    Sec. 2.  Section 411.6, Code 2025, is amended by adding the following new subsection:
   NEW SUBSECTION.  2A.  Early retirement benefits.
   a.  Notwithstanding the calculation of the service retirement allowance under subsection 2, beginning July 1, 2025, a member who has completed twenty-two years or more of creditable service and is at least fifty years of age, but less than fifty-five years of age, who has otherwise completed the requirements for retirement under subsection 1, may retire and receive a reduced service retirement allowance pursuant to this subsection. The service retirement allowance for a member less than fifty-five years of age shall be calculated in the manner prescribed in subsection 2, except that the percentage multiplier of the member’s average final compensation used in the determination of the service retirement allowance shall be reduced by the board of trustees pursuant to paragraph “b”.
   b.  On July 1, 2025, and on each July 1 thereafter, the board of trustees shall determine for the respective fiscal year the percent by which the percentage multiplier under subsection 2 shall be reduced for each month that a member’s retirement date precedes the member’s fifty-fifth birthday. The board of trustees shall make this determination based upon the most recent actuarial valuation of the system, the calculation of the actuarial cost for each month of retirement of a member prior to age fifty-five, and the premise that the provision of a service retirement allowance to a member who is less than fifty-five years of age will not result in any increase in cost to the system.
    Sec. 3.  Section 411.6, subsection 11, unnumbered paragraph 1, Code 2025, is amended to read as follows:
   In the event of the death of any member receiving a retirement allowance under the provisions of subsection 2, 2A, 4, or 6 of this section there shall be paid a pension:
EXPLANATION
The inclusion of this explanation does not constitute agreement with
the explanation’s substance by the members of the general assembly.
   This bill provides that a member of the municipal fire and police retirement system may elect to retire at 50 years of age with 22 years of service and receive a reduced service retirement allowance, rather than retire at age 55. Similar provisions exist under current law for the peace officers’ retirement, accident, and disability system (Code section 97A.6(2A)).