HF 967 (LSB 2794HV (2) 91)

HOUSE FILE 967

BY  COMMITTEE ON STATE GOVERNMENT

(SUCCESSOR TO HSB 265)

A BILL FOR

An Act relating to benefits and contributions for members of the Iowa public employees’ retirement system who are employed in a protection occupation.
BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA:

    Section 1.  Section 97B.11, subsection 3, unnumbered paragraph 1, Code 2025, is amended to read as follows:
   On and after From July 1, 2011, until June 30, 2025, for purposes of this section, unless the context otherwise requires:
    Sec. 2.  Section 97B.11, Code 2025, is amended by adding the following new subsection:
   NEW SUBSECTION.  4.  On and after July 1, 2025, for purposes of this section, unless the context otherwise requires:
   a.  For members in regular service:
   (1)  “Applicable employee percentage” means the percentage rate equal to forty percent of the required contribution rate for members in regular service.
   (2)  “Applicable employer percentage” means the percentage rate equal to sixty percent of the required contribution rate for members in regular service.
   b.  For members in special service in a protection occupation as described in section 97B.49B:
   (1)  “Applicable employee percentage” means the percentage rate equal to fifty percent of the required contribution rate for members described in section 97B.49B.
   (2)  “Applicable employer percentage” means the percentage rate equal to fifty percent of the required contribution rate for members described in section 97B.49B. 
   c.  For members in special service as a county sheriff or deputy sheriff as described in section 97B.49C:
   (1)  “Applicable employee percentage” means the percentage rate equal to fifty percent of the required contribution rate for members described in section 97B.49C.
   (2)  “Applicable employer percentage” means the percentage rate equal to fifty percent of the required contribution rate for members described in section 97B.49C.
   d.  “Required contribution rate” means the same as defined in subsection 3.
    Sec. 3.  Section 97B.49B, subsection 1, paragraph a, subparagraph (6), Code 2025, is amended to read as follows:
   (6)  For each active or inactive vested member retiring on or after July 1, 2003, and before July 1, 2025, sixty percent plus, if applicable, an additional three-eighths of one percentage point for each additional calendar quarter of eligible service beyond twenty-two years of service for the member, not to exceed a total of twelve additional percentage points.
    Sec. 4.  Section 97B.49B, subsection 1, paragraph a, Code 2025, is amended by adding the following new subparagraph:
   NEW SUBPARAGRAPH.  (7)  For each active or inactive vested member retiring on or after July 1, 2025, sixty percent plus, if applicable, an additional five-eighths of one percentage point for each additional calendar quarter of eligible service beyond twenty-two years of service, not to exceed a total of twenty additional percentage points.
    Sec. 5.  Section 97B.49B, subsection 2, Code 2025, is amended to read as follows:
   2.  Calculation of monthly allowance.
   a.  Notwithstanding other provisions of this chapter, a member who is or has been employed in a protection occupation who retires on or after July 1, 1994, but before July 1, 2025, and at the time of retirement is at least fifty-five years of age may elect to receive, in lieu of the receipt of any benefits as calculated pursuant to section 97B.49A or 97B.49D, a monthly retirement allowance equal to one-twelfth of an amount equal to the applicable percentage of the three-year average covered wage as a member who has been employed in a protection occupation multiplied by a fraction of years of service, with benefits payable during the member’s lifetime.
   b.  Notwithstanding other provisions of this chapter, a member who is or has been employed in a protection occupation who retires on or after July 1, 2025, and at the time of retirement is at least fifty-five years of age, or is at least fifty years of age with at least twenty-two years of eligible service, may elect to receive, in lieu of the receipt of any benefits as calculated pursuant to section 97B.49A or 97B.49D, a monthly retirement allowance equal to one-twelfth of an amount equal to the applicable percentage of the three-year average covered wage as a member who has been employed in a protection occupation multiplied by a fraction of years of service, with benefits payable during the member’s lifetime.
    Sec. 6.  Section 97B.49B, Code 2025, is amended by adding the following new subsection:
   NEW SUBSECTION.  5.  Annual adjustment of allowance.  A member who retires from employment in a protection occupation on or after July 1, 2025, and who receives a monthly retirement allowance under this section, shall have the monthly retirement allowance adjusted as follows:
   a.  On each July 1, the monthly retirement allowance authorized in this section and payable to a member retired prior to that date, and to a beneficiary or contingent annuitant entitled to a monthly retirement allowance prior to that date, shall be adjusted by adding to the monthly retirement allowance payable on that date an amount equal to the sum of one and one-half percent of the monthly retirement allowance payable on that date.
   b.  A retired member, beneficiary, or contingent annuitant shall not be eligible for an annual readjustment of allowance provided in this subsection unless the member has twenty-two years of eligible service and attained the age of fifty years prior to the member’s termination of employment.
   c.  A retired member, beneficiary, or contingent annuitant that receives an annual adjustment of allowance provided in this subsection shall not be eligible for the retirement dividends under section 97B.49F.
EXPLANATION
The inclusion of this explanation does not constitute agreement with
the explanation’s substance by the members of the general assembly.
   This bill modifies the Iowa public employees’ retirement system (IPERS) benefits and contributions for members employed in a protection occupation.
   The bill increases the amount a member of IPERS who is employed in a protection occupation is required to contribute to IPERS from 40 percent to 50 percent of the required contribution rate and decreases the applicable employer percentage for an employer of an IPERS member who is employed in a protection occupation from 60 percent to 50 percent of the required contribution rate.
   The monthly retirement benefit under IPERS for a member of a protection occupation is calculated by multiplying the retiree’s applicable covered wage by a percentage. Under current law, the applicable percentage is increased by 0.375 percent up to a maximum of 12 additional percentage points for calendar quarters of service beyond 22 years of service. The bill increases, for protection occupation members retiring on or after July 1, 2025, the applicable percentage used to calculate the retiree’s monthly retirement benefit to 0.625 percent for each calendar quarter of service beyond 22 years of service up to a maximum of 20 additional percentage points.
   The bill provides that a member of a protection occupation may elect to retire at 50 years of age with 22 years of service and receive the monthly retirement allowance under current law, rather than at age 55.
   The bill establishes a cost-of-living adjustment (COLA) to the monthly retirement allowance for active and inactive members and to beneficiaries and contingent annuitants for retirements occurring on or after July 1, 2025. Beginning July 1, 2025, and on each July 1 thereafter, the monthly retirement allowance of such a member, beneficiary, or contingent annuitant shall be adjusted by adding to the monthly retirement allowance an amount equal to 1.5 percent of the monthly retirement allowance payable on that date. Such a member, beneficiary, or contingent annuitant is not eligible for the COLA increase unless the member has 22 years of eligible service and attained 50 years of age prior to the retirement date of the member. A retired member, beneficiary, or contingent annuitant that receives the COLA is not eligible for the retirement dividends under Code section 97B.49F.