SB 1557 — Modifies provisions relating to retirement, including Tier 2011 and deferred compensation

SECOND6554S.03C REGULARSENATE SESSIONCOMMITTEE SUBSTITUTE FOR SENATE BILLNO.BILLS NOS.

1557 103RD& GENERALASSEMBLY1054 INTRODUCEDAN BYACT SENATORTo HENDERSON.repeal sections 104.1091 and 105.915, RSMo, and to enact in lieu thereof two new sections relating to retirement.

6554S.01I KRISTINAMARTIN, Secretary ANACT To repeal section 104.1091, RSMo, and to enact in lieu thereof one new section relating to refunds of retirement contributions.

SectionSections 104.1091,104.1091 and 105.915, RSMo, isare repealed and onetwo new sectionsections enacted in lieu thereof, to be known as sectionsections 104.1091,104.1091 and 105.915, to read as follows:

EXPLANATION-Matter(2) enclosedFor inmembers bold-facedof bracketsthe [thus]general inassembly, thisthe billmember's isattainment notof enactedat least age sixty-two and isthe intendedcompletion toof beat omittedleast inthree thefull law.biennial assemblies;

SB 1557 2 (2) For members of the general assembly, the member's attainment of at least age sixty-two and the completion of at least three full biennial assemblies;

A vested former member who terminated employment prior to the attainment of early SB 1557 3 retirement eligibility shall not be eligible for early retirement.

This deduction, however, shall not reduce the member's pay for purposes of SB 1557 4 computing benefits under the retirement system pursuant to this chapter;

Such SB 1557 5 member is not eligible to request a refund if such member's retirement benefit is subject to a division of benefit order pursuant to section 104.1051.

[Such refund] (b) For a former member who is not vested, the system shall refund the former member's contributions and interest credited thereon if the total amount thereof is one thousand dollars or less, or such other amount as may be permitted under applicable federal law,law. provided that:

The system'ssystem proceduresand inthe effecttreasurer fromare timeauthorized to timeshare toinformation locate such member shall be considered reasonable and necessary diligence consistent with goodsection business447.560 practice,for such that if after the applicationpurpose of suchthe proceduressystem's suchrefunding refund is returned to the system,former themember's refundcontributions shalland becredited presumedinterest todirectly be abandoned property under sections 447.500 to 447.585the notwithstandingformer anymember provisionsor ofthe thoseformer sectionsmember's whichsurvivor require a specific abandonment or dormancybeneficiary. period;

and b.

SubsectionThe 2availability of sectionthe 104.620shared information for public inspection shall notbe applyconsistent towith suchsection refunds.447.560.

c.

The system's procedures in effect from time to time to locate such former member, survivor, or beneficiary shall be considered reasonable and necessary diligence consistent with good business practice and in compliance with federal law.

provided that any member or vested former member receiving disability benefits shall not SB 1557 6 be eligible for a refund.

SB 1557 7 A retiree's life annuity shall be reduced to a certain percent of the annuity otherwise payable.

if the retiree's age on the annuity starting date is younger than sixty-seven years, an increase of three-tenthsthree- tenths of one percent for each year the retiree's age is younger than age sixty-seven years;

and if the SB 1557 8 beneficiary's age is younger than the retiree's age on the annuity starting date, a decrease of five-tenths of one percent for each year of age difference;

A retiree's life annuity shall be reduced to ninety-threeninety- three percent of the annuity otherwise payable.

SB 1557 9 Option 4.

or in the case of a member who is serving as a uniformed member of the highway patrol and subject to the mandatory retirement provisions of section 104.081, such member's attainment of at least age sixty or the attainment SB 1557 10 of at least age fifty-five with five years of credited service;

(6) The survivor annuity payable under section 104.1030 for vested former members who terminated employment SB 1557 11 prior to the attainment of early retirement eligibility and who are covered by this section shall not be payable until the deceased member would have reached his or her normal retirement eligibility under this subsection;

105.915.

1.

The board of trustees of the Missouri state employees' retirement system shall administer the deferred compensation fund for the employees of the state of Missouri that was previously administered by the deferred compensation commission, as established in section 105.910, prior to August 28, 2007.

The board shall be vested with the same powers that it has under chapter 104 to enable it and its officers, employees, and agents to administer the fund under sections 105.900 to 105.927.

2.

Except as provided in this subsection, participation in such plan shall be by a specific written agreement between state employees and the state, which shall provide for the deferral of such amounts of compensation as requested by the employee subject to any limitations imposed under federal law.

Participating employees must authorize that such deferrals be made from their wages for the purpose of participation in such program.

An election to defer compensation shall be made before the beginning of the [month in] payroll period for which the compensation is paid.

Contributions shall be made for payroll periods [occurring on or after the first day of the month] beginning after the election is made.

3.

Each employee eligible to participate in the plan hired or rehired on or after July 1, 2012, shall be enrolled in the plan automatically and his or her employer shall, in accordance with the plan document, withhold and contribute to the plan an amount equal to one percent of eligible compensation received on and after the date of hire, unless the employee elects not to participate in the plan within the first thirty days of employment, and in that event, any amounts contributed and earnings thereon will be refunded by the plan to the employee pursuant to the procedure contained in the plan documents.

Employees who are employed by a state college or university shall not be automatically enrolled but may elect to participate in the plan and make contributions in accordance with the terms of the plan.

4.

Effective July 1, 2027:

(1) The plan document shall provide for automatic increases in the deferral amount contributed by a participating employee commencing with the first payroll period following the employee's one-year anniversary date of employment or reemployment, whichever is later.

The deferral amount shall increase annually by one-half of one percent until the amount reaches ten percent of the employee's eligible compensation or the limitation imposed under federal law, whichever is less.

(2) Each employee eligible to participate in the plan who was last hired or rehired on or after July 1, 2012, and before July 1, 2027, who was automatically enrolled in the plan pursuant to subsection 3 of this section, and whose contribution is equal to one percent of eligible compensation on the effective date, shall be enrolled in such automatic increases.