Bill Text: IA HF2123 | 2023-2024 | 90th General Assembly | Introduced
Bill Title: A bill for an act concerning special service members of the Iowa public employees' retirement system by establishing a deferred retirement option plan.
Spectrum: Partisan Bill (Republican 1-0)
Status: (Introduced - Dead) 2024-01-24 - Introduced, referred to State Government. H.J. 126. [HF2123 Detail]
Download: Iowa-2023-HF2123-Introduced.html
House
File
2123
-
Introduced
HOUSE
FILE
2123
BY
MEGGERS
A
BILL
FOR
An
Act
concerning
special
service
members
of
the
Iowa
public
1
employees’
retirement
system
by
establishing
a
deferred
2
retirement
option
plan.
3
BE
IT
ENACTED
BY
THE
GENERAL
ASSEMBLY
OF
THE
STATE
OF
IOWA:
4
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Section
1.
NEW
SECTION
.
97B.50B
Deferred
retirement
option
1
plan
for
special
service
members.
2
1.
For
purposes
of
this
section,
unless
the
context
3
otherwise
requires:
4
a.
“Applicable
percentage”
means
that
percentage,
not
5
greater
than
one
hundred
percentage
points,
equal
to
fifty-two
6
percentage
points
plus
two
percentage
points
for
each
month
for
7
the
period
between
the
eligible
member’s
plan
eligibility
month
8
and
the
month
the
eligible
member
commences
membership
in
the
9
plan.
10
b.
“Drop
benefit”
means,
for
a
participant,
an
amount
11
credited
to
the
participant’s
account
each
applicable
month
12
equal
to
the
member’s
applicable
percentage
multiplied
by
the
13
member’s
participant
retirement
amount.
14
c.
“Eligible
member”
means
a
member,
as
defined
in
section
15
97B.50A,
who
has
attained
fifty-five
years
of
age
with
at
least
16
twenty-two
years
of
membership
service.
17
d.
“Participant
account”
means
an
administrative
record
18
maintained
by
the
system
reflecting
the
participant’s
19
accumulated
drop
benefit.
20
e.
“Participant
retirement
amount”
means
the
amount
equal
to
21
the
monthly
retirement
allowance
the
eligible
member
would
have
22
received
under
section
97B.49B
or
97B.49C,
as
applicable,
if
23
the
member
retired
on
the
date
the
eligible
member
commenced
24
participation
in
the
plan,
based
on
earnings
through
the
25
previous
full
quarter
of
covered
wages
earned
by
the
member.
26
f.
“Plan”
means
the
deferred
retirement
option
plan
27
established
by
this
section.
28
g.
“Plan
eligibility
month”
means
the
first
full
calendar
29
month
in
which
the
participant
is
an
eligible
member.
30
2.
a.
An
eligible
member
may
elect
to
participate
in
the
31
deferred
retirement
option
plan
as
provided
in
this
section.
32
A
decision
by
an
eligible
member
to
participate
in
the
plan
33
is
irrevocable.
Upon
commencing
membership
in
the
plan,
the
34
member
shall
remain
an
active
member
of
the
system
and
shall
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have
credited
to
a
participant
account
on
behalf
of
the
member
1
from
the
retirement
fund
for
each
month
the
member
participates
2
in
the
plan
the
member’s
drop
benefit.
The
amounts
credited
3
shall
be
invested
by
the
system
in
risk-free
assets
of
a
4
short-term
nature
and
interest
and
earnings
shall
not
be
5
credited
to
the
member’s
participant
account
but
shall
remain
6
with
the
retirement
fund
established
in
section
97B.7.
7
b.
Upon
termination
of
an
eligible
member’s
participation
8
in
the
plan,
the
eligible
member
shall
be
deemed
to
be
retired
9
under
the
system
as
of
that
date
for
purposes
of
the
system
10
and
shall
begin
receiving
a
retirement
allowance
equal
to
11
the
member’s
participant
retirement
amount
or
such
optional
12
retirement
benefits,
based
upon
that
amount,
pursuant
to
13
section
97B.51.
In
addition,
the
eligible
member
shall
receive
14
the
moneys
credited
to
the
member’s
participant
account
while
15
participating
in
the
plan.
The
eligible
member
shall
select,
16
upon
written
application
to
the
system,
whether
to
receive
17
the
amount
in
the
member’s
participant
account
in
the
form
18
of
a
lump
sum
distribution
or
as
a
rollover
to
an
eligible
19
retirement
plan
as
defined
in
section
97B.53B.
20
c.
If
an
eligible
member
terminates
participation
in
the
21
plan
prior
to
the
date
selected
by
the
member
upon
commencing
22
membership
in
the
plan
and
the
termination
is
not
due
to
the
23
death
or
disability
of
the
member
under
this
chapter,
then
24
the
system
shall
assess
a
twenty-five
percent
penalty
on
the
25
amount
credited
to
the
member’s
participant
account
prior
to
26
distributing
the
amount
to
the
member.
The
penalty
amount
27
shall
be
transferred
to
and
remain
with
the
retirement
fund.
28
3.
To
participate
in
the
plan,
an
eligible
member
shall
29
make
written
application
to
the
system.
The
application
shall
30
include
the
following:
31
a.
The
month
the
eligible
member
intends
to
commence
32
participation
in
the
plan.
33
b.
The
eligible
member’s
selection
of
a
plan
termination
34
date.
The
plan
termination
date
shall
be
either
three,
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four,
or
five
years
after
the
date
the
eligible
member
1
commences
membership
in
the
plan.
However,
for
the
two-year
2
period
beginning
with
the
first
of
the
month
following
the
3
implementation
date
of
this
section,
an
eligible
member
between
4
sixty-two
and
sixty-four
years
of
age
may
also
select
a
plan
5
termination
date
that
is
one
or
two
years
after
the
date
the
6
eligible
member
commences
membership
in
the
plan.
7
4.
Upon
participation
in
the
plan
by
an
eligible
member,
if
8
the
eligible
member
is
a
manager
or
supervisor,
the
eligible
9
member
shall
return
to
the
highest
rank
or
position
the
manager
10
or
supervisor
held
prior
to
becoming
a
manager
or
supervisor.
11
5.
Participation
in
the
plan
by
an
eligible
member
does
not
12
guarantee
continued
employment.
Contributions
required
from
13
members
and
participating
cities
shall
continue
based
on
the
14
earnable
compensation
of
an
eligible
member
participating
in
15
the
plan.
However,
contributions
made
while
an
eligible
member
16
participates
in
the
plan
shall
remain
with
the
retirement
fund
17
and
shall
not
be
subject
to
a
refund
of
contributions
under
18
section
97B.53.
19
6.
The
system’s
actuary,
while
making
the
annual
valuation
20
of
the
assets
and
liabilities
of
the
retirement
system,
shall
21
determine
whether
establishment
and
operation
of
the
plan
22
created
in
this
section
has
resulted
in
an
increased
actuarial
23
cost
to
the
system.
If
the
actuary
determines
that
the
plan
24
has
resulted
in
an
increased
actuarial
cost
to
the
system,
25
then,
notwithstanding
any
provision
of
section
97B.11
to
the
26
contrary,
the
system
shall
increase
the
members’
contribution
27
rate
as
necessary
to
cover
the
increased
cost
of
the
plan
28
created
in
this
section.
29
EXPLANATION
30
The
inclusion
of
this
explanation
does
not
constitute
agreement
with
31
the
explanation’s
substance
by
the
members
of
the
general
assembly.
32
This
bill
concerns
special
service
members
of
the
Iowa
33
public
employees’
retirement
system
(IPERS)
created
in
Code
34
chapter
97B.
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New
Code
section
97B.50B
establishes
a
deferred
retirement
1
option
plan
(DROP)
for
special
service
members
of
IPERS.
2
The
new
Code
section
provides
that
special
service
members
3
of
IPERS
who
are
at
least
55
years
of
age
and
have
at
least
4
22
years
of
service
are
eligible
to
participate
in
the
DROP
5
plan.
The
DROP
plan
provides
that
an
eligible
member
can
delay
6
retirement,
continue
working
for
a
set
number
of
additional
7
years,
and
have
a
portion
of
the
retirement
allowance
they
8
otherwise
would
have
received
if
they
had
retired
instead
of
9
participating
in
the
DROP
plan
deposited
in
an
account
that
is
10
then
distributed
to
them
when
they
eventually
retire.
However,
11
the
member’s
retirement
allowance
is
set
at
the
time
the
member
12
enters
the
DROP
plan.
13
Prior
to
participating
in
the
DROP
plan,
a
member
shall
14
submit
an
application
to
the
system
indicating
when
they
intend
15
to
start
participation
in
the
DROP
plan
and
when
they
intend
16
to
terminate
their
participation
in
the
plan
and
retire.
The
17
bill
permits
an
eligible
member
to
elect
to
participate
in
the
18
DROP
plan
for
three,
four,
or
five
years.
However,
for
the
19
two-year
period
beginning
on
the
implementation
date
of
this
20
Code
section,
an
eligible
member
between
the
ages
of
62
and
64
21
can
elect
to
participate
in
the
DROP
plan
and
terminate
their
22
participation
in
one
or
two
years.
23
If
an
eligible
person
who
participates
in
the
DROP
plan
24
is
a
manager
or
supervisor,
the
bill
requires
the
manager
25
or
supervisor
to
return
to
the
highest
rank
or
position
the
26
manager
or
supervisor
held
prior
to
becoming
a
manager
or
27
supervisor.
28
Upon
electing
to
participate
in
the
DROP
plan,
the
eligible
29
member
continues
to
work
but
has
a
portion
of
the
retirement
30
allowance
they
would
have
received
if
they
had
decided
to
31
retire
credited
to
an
account.
The
amount
credited
is
equal
32
to
a
percentage
of
the
retirement
allowance
they
would
have
33
received.
The
percentage
rate
is
determined
by
starting
with
34
52
percent
and
adding
2
percent
per
month,
up
to
a
maximum
of
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100
percent,
based
upon
the
number
of
months
between
the
month
1
the
member
first
became
eligible
to
participate
in
the
DROP
2
plan
and
the
month
the
member
actually
participates.
The
bill
3
provides
that
the
amount
deposited
in
the
member’s
account
does
4
not
accrue
interest
or
dividends.
Upon
termination
from
the
5
DROP
plan,
the
eligible
member
begins
to
receive
a
retirement
6
allowance
based
upon
the
amount
the
member
would
have
received
7
when
the
member
commenced
participation
in
the
DROP
plan
plus
8
the
amount
in
the
member’s
account.
If
the
member
terminates
9
participation
in
the
plan
prior
to
the
date
set
by
the
member
10
and
the
termination
is
not
due
to
the
member’s
death
or
11
disability,
IPERS
shall
withhold
25
percent
of
the
amount
in
12
the
account
as
a
penalty.
The
bill
provides
that
participation
13
in
the
DROP
plan
does
not
guarantee
continued
employment.
14
The
new
Code
section
also
provides
that
if
the
IPERS
actuary
15
determines
that
the
DROP
plan
has
increased
the
actuarial
cost
16
of
the
system,
the
contribution
rate
paid
by
special
service
17
members
shall
be
increased
to
cover
this
increased
cost.
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