Bill Text: NH SB368 | 2024 | Regular Session | Introduced
Bill Title: Relative to service retirement allowances for teachers and other group I retirement system members.
Spectrum: Strong Partisan Bill (Democrat 11-1)
Status: (Introduced - Dead) 2024-03-21 - Refer to Interim Study, Motion Adopted, Voice Vote; 03/21/2024; Senate Journal 7 [SB368 Detail]
Download: New_Hampshire-2024-SB368-Introduced.html
SB 368-FN - AS INTRODUCED
2024 SESSION
24-2955
05/10
SENATE BILL 368-FN
AN ACT relative to service retirement allowances for teachers and other group I retirement system members.
SPONSORS: Sen. Fenton, Dist 10; Sen. Innis, Dist 7; Sen. Whitley, Dist 15; Sen. D'Allesandro, Dist 20; Sen. Prentiss, Dist 5; Sen. Rosenwald, Dist 13; Sen. Soucy, Dist 18; Sen. Perkins Kwoka, Dist 21; Sen. Watters, Dist 4; Sen. Altschiller, Dist 24; Sen. Chandley, Dist 11; Rep. Myler, Merr. 9
COMMITTEE: Executive Departments and Administration
─────────────────────────────────────────────────────────────────
ANALYSIS
This bill revises the application of the reduction in a service retirement allowance for teachers and other group I member employees at full retirement age.
- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -
Explanation: Matter added to current law appears in bold italics.
Matter removed from current law appears [in brackets and struckthrough.]
Matter which is either (a) all new or (b) repealed and reenacted appears in regular type.
24-2955
05/10
STATE OF NEW HAMPSHIRE
In the Year of Our Lord Two Thousand Twenty Four
AN ACT relative to service retirement allowances for teachers and other group I retirement system members.
Be it Enacted by the Senate and House of Representatives in General Court convened:
1 Service Retirement Allowances for Teachers and Other Group I Member Employees; Application of Benefit. RSA 100-A:5, I(b); 100-A:6, I(b)(1)(A) and (B); and 100-A:6, I(d)(1)(A) and (B), as amended by 2023, 79:459, relative to the reduction of a retiree's annuity at the member's full retirement age under the federal Social Security system, shall apply to any retired employee member or retired teacher member of group I who retired prior to July 1, 2023, and who has not attained age 65 prior to July 1, 2024.
2 Effective Date. This act shall take effect July 1, 2024.
24-2955
Revised 12/29/23
SB 368-FN- FISCAL NOTE
AS INTRODUCED
AN ACT relative to service retirement allowances for teachers and other group I retirement system members.
FISCAL IMPACT: [ X ] State [ X ] County [ X ] Local [ ] None
|
| |||||
Estimated State Impact - Increase / (Decrease) | ||||||
| FY 2024 | FY 2025 | FY 2026 | FY 2027 | ||
Revenue | $0 | $0 | $0 | $0 | ||
Revenue Fund(s) | None | |||||
Expenditures | $0 | Indeterminable | $200,000 | $210,000 | ||
Funding Source(s) | General Fund and Highway Fund Various Agency Funds | |||||
Appropriations | $0 | $0 | $0 | $0 | ||
Funding Source(s) | None | |||||
• Does this bill provide sufficient funding to cover estimated expenditures? [X] N/A • Does this bill authorize new positions to implement this bill? [X] N/A | ||||||
| ||||||
Estimated Political Subdivision Impact - Increase / (Decrease) | ||||||
| FY 2024 | FY 2025 | FY 2026 | FY 2027 | ||
Revenue | $0 | $0 | $0 | $0 | ||
Expenditures | $0 | $0 | $520,000 | $520,000 | ||
*The New Hampshire Retirement System states it is not able to separate the fiscal impact of this legislation between county and local government, therefore the fiscal impact is shown together as political subdivisions.
METHODOLOGY:
This bill amends RSA 100-A:5, I(b); 100-A:6, I(b)(1)(A) and (B); and 100-A:6, I(d)(1)(A) and (B), as amended by 2023, 79:459. The chapter law is relative to how a retiree's annuity is reduced at their full retirement age within the federal Social Security system. This bill modifies it to be applicable to any retired Group I (employee and teacher) member who retired before July 1, 2023, and hasn't reached the age of 65 before July 1, 2024.
The New Hampshire Retirement System (NHRS) states their actuary utilized payee census data from June 30, 2023, to assess the impact of the bill, which is estimated to affect around 3,000 payees. Additional, the NHRS states there will be an indeterminable increase in expenditures in FY 2025 due to administrative costs relating to the reprogramming of the pension administrative system.
The NHRS's actuary has confirmed that contributions for fiscal years 2024 and 2025 are certified and will remain unchanged. However, the potential impact on fiscal years 2026 and 2027 is solely attributable to this proposed bill. It is anticipated that future employer contributions will increase in alignment with wage inflation.
The actuary's valuations, based on data from the annual actuarial valuation as of June 30, 2021, assume an annual interest rate of 6.75 percent, wage inflation set at 2.75 percent per year, and the utilization of the entry-age actuarial cost valuation method.
It's important to note that actual employer rates for fiscal years 2026-2027 will be determined based on the June 30, 2023 actuarial valuation and may vary from the estimates provided. The estimated allocation of this benefit is as follows:
Estimate State Impact
Increase (Decrease) in Employer Pension Rates as a Percent of Payroll | |
| Net Impact of Proposal |
Employees | 0.03% |
Police | 0.00% |
Fire | 0.00% |
Expected Employer Dollar Increase (Decrease) Due to Proposal | ||||
| FY 2024 | FY 2025 | FY 2026 | FY 2027 |
Employees | - | - | $200,000 | $210,000 |
Police | - | - | $0 | $0 |
Fire | - | - | $0 | $0 |
TOTAL | $0 | $0 | $200,000 | $210,000 |
Estimated Political Subdivision Impact
Increase (Decrease) in Employer Pension Rates as a Percent of Payroll | |
| Net Impact of Proposal |
Employees | 0.03% |
Teachers | 0.02% |
Police | 0.00% |
Fire | 0.00% |
Expected Employer Dollar Increase (Decrease) Due to Proposal | ||||
| FY 2024 | FY 2025 | FY 2026 | FY 2027 |
Employees | - | - | $250,000 | $250,000 |
Teachers | - | - | $270,000 | $270,000 |
Police | - | - | $0 | $0 |
Fire | - | - | $0 | $0 |
TOTAL | $0 | $0 | $520,000 | $520,000 |
The NHRS actuary projects an increase in the actuarial accrued liability of $11.1 million based on the provisions in the bill which will be amortized over a fixed period of no longer than 20-years.
AGENCIES CONTACTED:
New Hampshire Retirement System
