Bill Text: NJ A1606 | 2010-2011 | Regular Session | Introduced
Bill Title: Increases enrollment threshold in PERS and TPAF to $10,000; requires assessment of adding annual minimum hour requirement to qualify for service credit.
Spectrum: Moderate Partisan Bill (Republican 7-1)
Status: (Introduced - Dead) 2010-01-12 - Introduced, Referred to Assembly State Government Committee [A1606 Detail]
Download: New_Jersey-2010-A1606-Introduced.html
STATE OF NEW JERSEY
214th LEGISLATURE
PRE-FILED FOR INTRODUCTION IN THE 2010 SESSION
Sponsored by:
Assemblyman DECLAN J. O'SCANLON, JR.
District 12 (Mercer and Monmouth)
Co-Sponsored by:
Assemblywomen Handlin, Casagrande, Assemblymen Biondi, Wolfe, Holzapfel, Rudder and Assemblywoman Addiego
SYNOPSIS
Increases enrollment threshold in PERS and TPAF to $10,000; requires assessment of adding annual minimum hour requirement to qualify for service credit.
CURRENT VERSION OF TEXT
Introduced Pending Technical Review by Legislative Counsel
An Act concerning the enrollment threshold for the Teachers' Pension and Annuity Fund and the Public Employees' Retirement System, and amending various parts of the statutory law.
Be It Enacted by the Senate and General Assembly of the State of New Jersey:
1. N.J.S.18A:66-4 is amended to read as follows:
18A:66-4. The membership of the retirement system shall consist of:
(a) all members of the teachers' pension and annuity fund enrolled as such as of December 31, 1955;
(b) any person becoming a teacher on or after January 1, 1956, except any person who has attained the age of 60 years prior to becoming a teacher after June 30, 1958 but before July 1, 1968;
(c) every teacher veteran as of January 1, 1956, who is not a member of the "Teachers' Pension and Annuity Fund" as of such date and who shall not have notified the board of trustees within 30 days of such date that he does not desire to become a member;
(d) any teacher employed on January 1, 1956, who is not a member of the Teachers' Pension and Annuity Fund and who elects to become a member under the provisions of section 18A:66-10.
No person in employment, office or position, for which the annual salary or remuneration is fixed at less than $500.00, or less than $10,000 after the effective date of P.L. , c. (pending before the Legislature as this bill), shall be eligible to become a member of the retirement system.
(cf: P.L.1968, c.229, s.1)
2. N.J.S.18A:66-8 is amended to read as follows:
18A:66-8. a. If a teacher:
(1) is dismissed by an employer by reason of reduction in number of teachers employed in the school district, institution or department when in the judgment of the employer it is advisable to abolish any office, position or employment for reasons of a reduction in the number of pupils, economy, a change in the administrative or supervisory organization or other good cause; or becomes unemployed by reason of the creation of a regional school district or a consolidated school district; or has been discontinued from service without personal fault or through leave of absence granted by an employer or permitted by any law of this State; and
(2) has not withdrawn the accumulated member's contributions from the retirement system, the teacher's membership may continue, notwithstanding any provisions of this article, if the member returns to service within a period of 10 years from the date of discontinuance from service. No credit for retirement purposes shall be allowed to the member covering the period of discontinuance, except as provided in this section. In computing the service or in computing final compensation, no time after September 1, 1919, during which a member shall have been employed as a teacher at an annual salary or remuneration fixed at less than $500.00, or less than $10,000 after the effective date of P.L. , c. (pending before the Legislature as this bill), shall be credited, except that in the case of a veteran member credit shall be given for service rendered prior to January 1, 1955, in an employment, office or position if the annual salary or remuneration therefor was fixed at not less than $300.00 and the service consisted of the performance of the full duties of the employment, office or position.
b. A teacher may purchase credit for time during which the teacher shall have been absent on an official leave without pay. The credit shall be purchased for a period of time equal to:
(1) three months or the duration of the leave, whichever is less; or
(2) if the leave was due to the member's personal illness, two years or the duration of the leave, whichever is less; or
(3) the period of leave that is specifically allowed for retirement purposes by the provisions of any law of this State.
The purchase shall be made in the same manner and be subject to the same terms and conditions provided for the purchase of previous membership service by N.J.S.18A:66-9.
(cf: P.L.1991, c.138, s.1)
3. Section 7 of P.L.1954, c.84 (C.43:15A-7) is amended to read as follows:
7. There is hereby established the Public Employees' Retirement System of New Jersey in the Division of Pensions and Benefits of the Department of the Treasury. The membership of the retirement system shall include:
a. The members of the former "State Employees' Retirement System of New Jersey" enrolled as such as of December 30, 1954, who shall not have claimed for refund their accumulated deductions in said system as provided in this section;
b. Any person becoming an employee of the State or other employer after January 2, 1955 and every veteran, other than a retired member who returns to service pursuant to subsection b. of section 27 of P.L.1966, c.217 (C.43:15A-57.2) and other than those whose appointments are seasonal, becoming an employee of the State or other employer after such date, including a temporary employee with at least one year's continuous service; and
c. Every employee veteran in the employ of the State or other employer on January 2, 1955, who is not a member of any retirement system supported wholly or partly by the State.
d. Membership in the retirement system shall be optional for elected officials other than veterans, and for school crossing guards, who having become eligible for benefits under other pension systems are so employed on a part-time basis. Any such part-time school crossing guard who is eligible for benefits under any other pension system and who was hired as a part-time school crossing guard prior to March 4, 1976, may at any time terminate his membership in the retirement system by making an application in writing to the board of trustees of the retirement system. Upon receiving such application, the board of trustees shall terminate his enrollment in the system and direct the employer to cease accepting contributions from the member or deducting from the compensation paid to the member. State employees who become members of any other retirement system supported wholly or partly by the State as a condition of employment shall not be eligible for membership in this retirement system. Notwithstanding any other law to the contrary, all other persons accepting employment in the service of the State shall be required to enroll in the retirement system as a condition of their employment, regardless of age. No person in employment, office or position, for which the annual salary or remuneration is fixed at less than $1,500.00, or less than $10,000 after the effective date of P.L. , c. (pending before the Legislature as this bill), shall be eligible to become a member of the retirement system.
e. Membership of any person in the retirement system shall cease if he shall discontinue his service for more than two consecutive years.
f. The accumulated deductions of the members of the former "State Employees' Retirement System" which have been set aside in a trust fund designated as Fund A as provided in section 5 of this act and which have not been claimed for refund prior to February 1, 1955 shall be transferred from said Fund A to the Annuity Savings Fund of the Retirement System, provided for in section 25 of this act. Each member whose accumulated deductions are so transferred shall receive the same prior service credit, pension credit, and membership credit in the retirement system as he previously had in the former "State Employees' Retirement System" and shall have such accumulated deductions credited to his individual account in the Annuity Savings Fund. Any outstanding obligations of such member shall be continued.
g. Any school crossing guard electing to terminate his membership in the retirement system pursuant to subsection d. of this section shall, upon his request, receive a refund of his accumulated deductions as of the date of his appointment to the position of school crossing guard. Such refund of contributions shall serve as a waiver of all benefits payable to the employee, to his dependent or dependents, or to any of his beneficiaries under the retirement system.
h. A temporary employee who is employed under the federal Job Training Partnership Act, Pub.L.97-300 (29U.S.C. s.1501) shall not be eligible for membership in the system. Membership for temporary employees employed under the federal Job Training Partnership Act, Pub.L.97-300 (29U.S.C. s.1501) who are in the system on September 19, 1986 shall be terminated, and affected employees shall receive a refund of their accumulated deductions as of the date of commencement of employment in a federal Job Training Partnership Act program. Such refund of contributions shall serve as a waiver of all benefits payable to the employee, to his dependent or dependents, or to any of his beneficiaries under the retirement system.
i. Membership in the retirement system shall be optional for a special service employee who is employed under the federal Older American Community Service Employment Act, Pub.L.94-135 (42 U.S.C.s.3056). Any special service employee employed under the federal Older American Community Service Employment Act, Pub.L.94-135 (42 U.S.C.s.3056), who is in the retirement system on the effective date of P.L.1996, c.139 may terminate membership in the retirement system by making an application in writing to the board of trustees of the retirement system. Upon receiving the application, the board shall terminate enrollment in the system and the member shall receive a refund of accumulated deductions as of the date of commencement of employment in a federal Older American Community Service Employment Act program. This refund of contributions shall serve as a waiver of all benefits payable to the employee, to any dependent or dependents, or to any beneficiary under the retirement system.
j. An employee of the South Jersey Port Corporation who was employed by the South Jersey Port Corporation as of the effective date of P.L.1997, c.150 (C.34:1B-144 et al.) and who shall be re-employed within 365 days of such effective date by a subsidiary corporation or other corporation, which has been established by the Delaware River Port Authority pursuant to subdivision (m) of Article I of the compact creating the Delaware River Port Authority (R.S.32:3-2), as defined in section 3 of P.L.1997, c.150 (C.34:1B-146), shall be eligible to continue membership while an employee of such subsidiary or other corporation.
(cf: P.L.1997, c.150, s.23)
4. Section 39 of P.L.1954, c.84 (C.43:15A-39) is amended to read as follows:
39. In computing for retirement purposes the total service of a member about to be retired, the retirement system shall credit the member with the time of all service rendered by the member since that member's last enrollment, and in addition with all the service to which the member is entitled and with no other service. Except as otherwise provided in this act, this service credit shall be final and conclusive for retirement purposes unless the member shall discontinue service for more than two consecutive years.
For the purpose of computing service for retirement purposes, the board shall fix and determine by appropriate rules and regulations how much service in any year shall equal a year of service and a part of a year of service. Not more than one year shall be credited for all service in a calendar year. A member may purchase credit for time during which the member shall have been absent on an official leave without pay. The credit shall be purchased for a period of time equal to:
(1) three months or the duration of the leave, whichever is less; or
(2) if the leave was due to the member's personal illness, two years or the duration of the leave, whichever is less; or
(3) the period of leave that is specifically allowed for retirement purposes by the provisions of any law of this State.
The purchase shall be made in the same manner and be subject to the same terms and conditions provided for the purchase of previous membership service credit by section 8 of P.L.1954, c.54 (C.43:15A-8). In computing the service or in computing final compensation, no time during which a member was in employment, office, or position for which the annual salary or remuneration was fixed at less than $500.00 in the case of service rendered prior to November 6, 1986, or less than $1,500.00 in the case of service rendered on or after that date, or less than $10,000 after the effective date of P.L. , c. (pending before the Legislature as this bill), shall be credited, except that in the case of a veteran member credit shall be given for service rendered prior to January 2, 1955, in an employment, office or position if the annual salary or remuneration therefor was fixed at not less than $300.00 and such service consisted of the performance of the full duties of the employment, office or position.
(cf: P.L.1991, c.138, s.10)
5. Section 65 of P.L.1954, c.84 (C.43:15A-65) is amended to read as follows:
65. (a) All employees of any public agency or organization of this State, which employs persons engaged in service to the public, shall be eligible to participate in the Public Employees' Retirement System; provided the employer consents thereto by resolution and files a certified copy of such resolution with the board of trustees of the Public Employees' Retirement System and the board of trustees approves thereof by resolution. Such organization shall be referred to in this act as the employer. If the participation of such employees is so approved then the employer shall contribute to the contingent reserve fund on account of its members at the same rate per centum as would be paid by employers other than the State.
(b) Notwithstanding the provisions of subsection (a) of this section, every person becoming an employee of a public agency or organization of this State, which employs persons engaged in service to the public, after June 30, 1966, who is not eligible to become a member of any other retirement system, shall be required to participate in the Public Employees' Retirement System. Notwithstanding the provisions of subsection (a) of this section, membership in the Public Employees' Retirement System shall be optional with any person in the employ of any such public agency or organization on June 30, 1966, provided such person is not required to be a member pursuant to another provision of this act, and provided further that such person is not eligible to be a member of any other retirement system. The provisions of this subsection shall not apply to any person whose position is temporary or seasonal, nor to any person in office, position or employment for which the annual salary or remuneration is fixed at less than $1,500.00, or less than $10,000 after the effective date of P.L. , c. (pending before the Legislature as this bill), nor to any person whose position is not covered by the old-age and survivors' insurance provisions of the federal Social Security Act. The public agency or organization employing any such person who becomes a member of the retirement system pursuant to this subsection shall contribute to the contingent reserve fund on account of such employees at the same rate per centum as would be paid by employers other than the State.
(cf: P.L.1986, c.139, s.3)
6. Section 75 of P.L.1954, c.84 (C.43:15A-75) is amended to read as follows:
75. (a) If this act is so adopted it shall become effective in the county or municipality adopting it on June 30 of the following year. Membership in the Public Employees' Retirement System shall be optional with the employees of the county, board of education or municipality in the service on the day the act becomes effective or on June 30, 1966, whichever is earlier, in such county, board of education or municipality except in the case of public employee veterans who on such date are members. An employee who elects to become a member within one year after this act so takes effect shall be entitled to prior service covering service rendered to the county, board of education or municipality prior to July 1, 1966 or prior to the date this act so becomes effective, whichever is earlier. Membership shall be compulsory for all employees entering the service of the county, board of education or municipality on July 1, 1966 or after the date this act becomes effective, whichever is earlier. Where any such employee entering the service of the county, board of education of education or municipality after the date this act so becomes effective has had prior service for which evidence satisfactory to the retirement system is presented, as an employee in such county, board of education or municipality before the date upon which this act so becomes effective, or July 1, 1966, whichever is earlier, such employee shall be entitled to prior service covering service rendered to the county, board of education or municipality prior to the date this act so becomes effective, or July 1, 1966, whichever is earlier.
(b) Notwithstanding the provisions of section 74 of this act and subsection (a) of this section, every person, other than a non-veteran elected official, becoming an employee of a county, board of education, municipality or school district after June 30, 1966, who is not eligible to become a member of another retirement system, shall be required to become a member of the Public Employees' Retirement System. Notwithstanding the provisions of section 74 of this act and subsection (a) of this section, membership in the retirement system shall be optional with any elected official who is not a veteran, regardless of the date he assumes office, and with any other person in the employ of any county, board of education, municipality or school district on June 30, 1966, provided such elected official or other person is not then a member and is not required to be a member of the retirement system pursuant to another provision of this act, and provided further that such person is not eligible to be a member of another retirement system. The provisions of this subsection shall not apply to any person whose position is temporary or seasonal, nor to any person in office, position or employment for which the annual salary or remuneration is fixed at less than $1,500.00, or less than $10,000 after the effective date of P.L. , c. (pending before the Legislature as this bill), nor to any person whose position is not covered by the old age and survivors' insurance provisions of the federal Social Security Act. No credit shall be allowed to any person becoming a member of the retirement system pursuant to this subsection for service rendered to the employer prior to July 1, 1966, until the provisions of section 74 of this act have been complied with, in which event such credit shall be allowed in accordance with the provisions of subsection (a) of this section; except that the governing body of any county, board of education or municipality may, by resolution, consent to the allowance of such credit and file a certified copy of such resolution with the board of trustees of the Public Employees' Retirement System.
(cf: P.L.1986, c.139, s.4)
7. The Director of the Division of Pensions and Benefits shall undertake a study, to be completed within 180 days after the effective date of P.L. , c. (pending before the Legislature as this bill) and transmitted to the President of the Senate, the Minority Leader of the Senate, the Speaker of the General Assembly, and the Minority Leader of the General Assembly, that assesses and offers recommendations on the advisability of adding an annual minimum hour requirement for a public employee who is a member of a retirement system to qualify for service credit in that year. The director shall also assess and offer recommendations as to how such a requirement could be structured.
8. This act shall take effect immediately.
STATEMENT
This bill increases the threshold amount of compensation required for enrollment in the Public Employees' Retirement System (PERS) and the Teachers' Pension and Annuity Fund (TPAF) for current and future employees after the date on which the bill is enacted into law.
For PERS, the threshold amount is increased from $1,500 to $10,000 and for TPAF, the threshold amount is increased from $500 to $10,000. The PERS amount was last increased from $500 in 1986; the TPAF amount has not been increased since the fund's inception in the 1950's.
The bill also provides that the Director of the Division of Pensions and Benefits is to undertake a study, to be completed within 180 days after the effective date of the bill and transmitted to the President of the Senate, the Minority Leader of the Senate, the Speaker of the General Assembly, and the Minority Leader of the General Assembly, that assesses and offers recommendations on the advisability of adding an annual minimum hour requirement for a public employee who is a member of a retirement system to qualify for service credit in that year. The director would also assess and offer recommendations as to how such a requirement could be structured.
The bill's provisions are based on testimony and other information received by the sponsor in his capacity as a member of the Joint Legislative Committee on Public Employee Benefits Reform.
